Comverge Reports Second Quarter 2009 Financial Results
Quarterly Revenue Increases 39%
EAST HANOVER, N.J., Aug 06, 2009 /PRNewswire-FirstCall via COMTEX News Network/ -- Comverge, Inc. (Nasdaq: COMV), a leading provider of comprehensive smart grid, demand management, and energy efficiency solutions, today announced second quarter financial and operating results for 2009.
"Our second quarter performance kept us firmly on track to meet or exceed our targets for annual megawatt growth and future contracted revenue," said Michael D. Picchi, Interim President and CEO of Comverge. "We obtained regulatory approval of our Arizona Public Service VPC contract, the largest C&I VPC contract to date in the industry, and we secured more than 680 megawatts in the 2012/2013 PJM base residual capacity auction."
Picchi continued, "Our operational execution was solid as we realized 39% year-over-year revenue growth, built out 49 megawatts of capacity in our VPC programs and generated record cash from operations during the second quarter. We remain confident about the outlook for our performance in the remainder of this year."
Second quarter revenues for 2009 were $13.3 million compared to $9.5 million in the second quarter of 2008, a 39% increase. Revenues for both periods exclude revenues from residential VPC contracts, which are deferred and recognized in the fourth quarter. Deferred revenue on the balance sheet from the VPC contracts was $20.2 million as of June 30, 2009 compared to $4.3 million at year-end 2008, an increase of $15.9 million during the first half of 2009. The $15.9 million increase during the first half of 2009 is compared to a $10.8 million increase in VPC deferred revenue during the first half of 2008, a 47% increase.
Adjusted EBITDA for the second quarter of 2009 was a negative $6.3 million compared to a negative $6.8 million for the second quarter of 2008. Adjusted EBITDA is earnings before interest, taxes, depreciation, amortization and non-cash stock compensation expense (see Schedule 5 - Reconciliation of Non-GAAP Financial Measure to the Most Directly Comparable GAAP Financial Measure).
Net loss for the second quarter of 2009 was $9.1 million, or $0.43 per share basic and diluted, compared to a net loss of $9.6 million, or $0.45 per share basic and diluted for the second quarter of 2008.
Comverge second quarter 2009 business highlights include:
- Received regulatory approval of the Arizona Public Service contract, marking the largest commercial and industrial (C&I) Virtual Peaking Capacity(R) (VPC) demand response contract in the industry to date;
- Secured more than 680 megawatts of demand response capacity in the PJM Interconnection (PJM) market as a result of the 2012/13 Economic Load Response Program Base Residual Auction; and
- Increased total megawatts under management by 192 megawatts during the second quarter of 2009. As of June 30, 2009 total megawatts under management were:
- Megawatts under long-term contracts, with regulatory approval: 879
- Megawatts under open market programs: 1158
- Megawatts to be provided under turnkey programs: 320
- Megawatts managed for a fee: 437
Recent Developments and Current Outlook
Comverge entered into a 5-year agreement with a major Virginia-based energy provider to provide 117 megawatts of contracted demand side management capacity from commercial and industrial consumers, supply more than 150,000 advanced metering infrastructure compatible energy management devices for residential customers and provide our Apollo((R)) Demand Response Management System software.
Comverge's management and Board of Directors use three metrics to measure the company's operational progress: (i) megawatts owned under long-term contracts, (ii) megawatts managed under open market programs, and (iii) estimated future revenues from long-term contracts. We believe these metrics are the most important to the growth and long-term success of the company.
Our 2009 targets for growth in these metrics and our progress towards these metrics in the first half of 2009 are:
- Add a net 275 megawatts of capacity under long-term contracts. 178 megawatts of capacity under long-term contracts were added during the first half of 2009;
- Add a net 225 megawatts in open market programs. 264 megawatts were added in open market programs during the first half of 2009; and
- Add a net $150 million increase in the amount of estimated future revenues from long-term contracts. A net $177 million in estimated future revenues were added in the first half of 2009.
As of the date of this release, we have 1036 megawatts under long-term capacity contracts which represents approximately $570 million of contracted future revenues. Of these amounts, 157 megawatts of capacity under long-term contracts representing an expected $46 million in contracted future revenues, are still awaiting regulatory approval. Furthermore, we have been awarded 683 megawatts of capacity in the 2012 - 2013 PJM Economic Load Response Program, or ELRP. In the event we receive regulatory approval on these 157 megawatts and we secure adequate load capacity to meet our obligations under the 2012-2013 PJM ELRP, we will exceed 3,300 in total megawatts managed.
The above statements are based on current expectations. These statements are forward-looking and actual results may differ materially. The Company assumes no obligation to publicly update or revise its outlook. Investors are reminded that actual results may differ from these estimates for the reasons described below under the caption "Caution Regarding Forward Looking Statements" and in our filings with the Securities and Exchange Commission.
Comverge will discuss these results for the second quarter as well as its expectations for the future in a conference call scheduled today at 4:30 p.m. EDT. To participate in the call, dial 800-239-9838 or 913-312-1270 for international participants.
An audio replay of the call will be available beginning August 6, 2009 at 8:00 p.m. and will be available until August 13, 2009 12:00 a.m. EDT, (midnight) by dialing in 888-203-1112 (719-457-0820 for international participants) and using conference code number 2884208.
Additionally, the results will be reported by webcast and available online in the Comverge investor relations section at http://ir.comverge.com. This webcast will be available online and archived on Comverge's website until November 5, 2009 12:00 a.m. EDT.
Additional financial information can be found in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2009, which has been filed today with the Securities and Exchange Commission.
Comverge, with over 3300 megawatts of clean energy capacity under management, is a leading provider of clean energy solutions that improve grid reliability and supply electric capacity on a more cost effective basis than conventional alternatives by reducing base load and peak load energy consumption. For more information, visit www.comverge.com. Virtual Peaking Capacity is a registered trademark of Comverge, Inc. Apollo is a trademark of Comverge, Inc.
Caution Regarding Forward Looking Statements
This release contains forward-looking statements that are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements in this release are not and do not constitute historical facts, do not constitute guarantees of future performance and are based on numerous assumptions which, while believed to be reasonable, may not prove to be accurate. These forward looking statements include projected revenue guidance, projected contracted revenues, projected regulatory changes or approvals, the amount of revenue and megawatts that will be generated by long-term contracts or open market programs and certain assumptions upon which such forward-looking statements are based. The forward-looking statements in this release do not constitute guarantees of future performance and involve a number of factors that could cause actual results to differ materially, including risks associated with Comverge's business involving our products, the development and distribution of our products and related services, regulatory changes or grid operator rule changes, regulatory approval of our contracts, economic and competitive factors, our key strategic relationships, and other risks more fully described in our most recently filed Quarterly Report on Form 10-Q and Annual Report on Form 10-K. Comverge assumes no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein.
Regulation G Disclosure - Non-GAAP Financial Information
Non-GAAP financial measures are based upon our unaudited consolidated statements of operations for the periods shown, giving effect to the adjustments shown in the reconciliations set forth below. This presentation is not in accordance with, or an alternative for, U.S. generally accepted accounting principles (GAAP). The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. However, Comverge believes that non-GAAP reporting, giving effect to the adjustments shown in the reconciliation below, provides meaningful information and therefore uses it to supplement its GAAP reporting and internally in evaluating operations, managing and benchmarking performance. The Company has chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the reconciliations below, and to provide an additional measure of performance.
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