Comverge 8-K Comverge Reports Third Quarter 2009 Financial Results

 Exhibit 99.1

FOR IMMEDIATE RELEASE

Comverge Reports Third Quarter 2009 Financial Results

Quarterly Revenue Increases 37%

East Hanover, N.J., November 9, 2009 – Comverge, Inc. (NASDAQ: COMV), a leading provider of comprehensive smart grid, demand management, and energy efficiency solutions, today announced third quarter financial and operating results for 2009.

“Our third quarter performance kept us firmly on track to meet or exceed our targets for annual growth in megawatts under management and estimated future contract revenue,” said Michael D. Picchi, Interim President and CEO of Comverge.  “Our operational execution remained solid as we realized 37% year-over-year revenue growth, grew our Virtual Peaking Capacity deferred revenues 36%, and built out 18 megawatts of capacity in these programs.  We remain confident about the outlook for our performance in the remainder of this year.”

Picchi continued, “The awarding of $3.4 billion in stimulus funds by the Department of Energy to support smart grid projects that modernize the U.S. electricity grid under the American Recovery and Reinvestment Act is an exciting and unique opportunity. A number of our utility customers will be recipients of stimulus funds and Comverge expects our leading demand management solutions to be part of a number of these smart grid projects.”

Financial Summary

Third quarter revenues for 2009 were $33.2 million compared to $24.3 million in the third quarter of 2008, a 37% increase.  Revenues for both periods exclude revenues from residential Virtual Peaking Capacity (VPC) contracts, which are deferred and recognized in the fourth quarter.  Deferred revenue on the balance sheet from the VPC contracts was $25.0 million as of September 30, 2009 compared to $4.3 million at year-end 2008, an increase of $20.7 million during the first nine months of 2009.  The $20.7 million increase during the first nine months of 2009 is compared to a $15.2 million increase in VPC deferred revenue during the first nine months of 2008, a 36% increase.

Adjusted EBITDA for the third quarter of 2009 was a negative $3.9 million compared to a negative $4.7 million for the third 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 third quarter of 2009 was $9.4 million, or $0.44 per share basic and diluted, compared to a net loss of $81.8 million, or $3.85 per share basic and diluted for the third quarter of 2008. Net loss for the third quarter of 2009 included a one time expense of $4.3 million, or $0.20 per share basic and diluted, related to the retirement of Robert M. Chiste, the company’s former President and CEO.  Net loss for the third quarter of 2008 included a non-cash impairment charge for goodwill and certain intangible assets of $75.4 million. Net of a $1.0 million tax benefit, the net non-cash impairment charge of $74.4 million was a loss of $3.49 per share in the third quarter of 2008.

Business Highlights

Comverge third quarter 2009 business highlights include:

·   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® Demand Response Management System software.

·   Announced that our 4-year, 40 megawatt VPC contract with Southern California Edison (SCE) had received regulatory approval.

·   Increased total megawatts under management by 63 megawatts during the third quarter of 2009. As of September 30, 2009 total megawatts under management were:

-   Megawatts under long-term contracts, with regulatory approval                                                             919                                                              

-   Megawatts under open market programs                                                                                                     1181       

-   Megawatts to be provided under turnkey programs                                                                                   320                             

-   Megawatts managed for a fee                                                                                                                         437

-   Total megawatts                                                                                                                              2857

Recent Developments and Current Outlook

Comverge announced the appointment of A. Laurence Jones, Joseph M. O'Donnell and Scott B. Ungerer to its Board of Directors effective October 26, 2009.

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 nine months of 2009 are:

-- Add a net 275 megawatts of capacity under long-term contracts.  218 megawatts of capacity under long-term contracts were added during the first nine months of 2009;

-- Add a net 225 megawatts in open market programs.  287 megawatts were added in open market programs during the first nine months of 2009; and

-- Add a net $150 million increase in the amount of estimated future revenues from long-term contracts.  A net $169 million in estimated future revenues were added in the first nine months of 2009.

As of the date of this release, we have 1015 megawatts under long-term capacity contracts which represents approximately $527 million of estimated future contract revenues.  Of these amounts, 117 megawatts of capacity under long-term contracts representing an expected $32 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 117 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.

Additional Information

Comverge will discuss these results for the third quarter as well as its expectations for the future in a conference call scheduled today at 10:00 a.m. EDT.  To participate in the call, dial 888-713-4541 or 913-312-1502 for international participants.

An audio replay of the call will be available beginning November 9, 2009 at 1:00 p.m. and available until November 16, 2009 12:00 a.m. EST, (midnight) by dialing in 888-203-1112 (719-457-0820 for international participants) and using conference code number 9490642.  Additionally, the results will be reported in the Investor Relations section on Comverge's website at http://ir.comverge.com.

Additional financial information can be found in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2009, which has been filed today with the Securities and Exchange Commission.

About Comverge

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, potential incremental revenue from stimulus funding, 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 distributio

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.

Contact:

Investor Relations                                                                         Media Relations

Dan Pfeffer                                                                           Kristin Mastrandrea

VP, Treasurer-Investor Relations                                                                                            Communications Manager

678-802-8302, invest@comverge.com                                                                                     973-434-7157, pr@comverge.com

SCHEDULE 1
COMVERGE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2009			2008			2009			2008
Revenue
Product	$	6,263		$	4,796		$	16,176		$	12,247
Service		26,932			19,489			41,864			32,012
Total revenue		33,195			24,285			58,040			44,259
Cost of revenue
Product		3,793			2,973			9,879			7,672
Service		19,948			14,060			28,451			21,102
Total cost of revenue		23,741			17,033			38,330			28,774
Gross profit		9,454			7,252			19,710			15,485
Operating expenses
General and administrative expenses		12,419			9,507			28,409			26,423
Marketing and selling expenses		4,340			4,314			12,782			12,194
Research and development expenses		1,158			140			3,483			676
Amortization of intangible assets		553			610			1,657			1,922
Impairment charges		-			75,432			-			75,432
Operating loss		(9,016	)		(82,751	)		(26,621	)		(101,162	)
Interest and other expense, net		376			158			940			14
Loss before income taxes		(9,392	)		(82,909	)		(27,561	)		(101,176	)
Provision (benefit) for income taxes		52			(1,140	)		159			(970	)
Net loss	$	(9,444	)	$	(81,769	)	$	(27,720	)	$	(100,206	)
Net loss per share
Basic and diluted	$	(0.44	)	$	(3.85	)	$	(1.29	)	$	(4.75	)
Weighted average shares used in computation		21,551,171			21,258,430			21,442,715			21,101,887

SCHEDULE 2
COMVERGE, INC.
SEGMENT INFORMATION
(In thousands)
(Unaudited)
	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2009		2008		2009		2008
Revenue:
Utility Products & Services	$	9,185	$	6,042	$	23,785	$	15,507
Residential Business		2,285		5,577		9,256		10,680
Commercial & Industrial Business		21,725		12,666		24,999		18,072
Total Revenue	$	33,195	$	24,285	$	58,040	$	44,259
Cost of Revenue:
Utility Products & Services	$	5,506	$	3,459	$	13,745	$	8,877
Residential Business		1,272		3,165		5,605		5,784
Commercial & Industrial Business		16,963		10,409		18,980		14,113
Total Cost of Revenue	$	23,741	$	17,033	$	38,330	$	28,774
Gross Profit:
Utility Products & Services	$	3,679	$	2,583	$	10,040	$	6,630
Residential Business		1,013		2,412		3,651		4,896
Commercial & Industrial Business		4,762		2,257		6,019		3,959
Total Gross Profit	$	9,454	$	7,252	$	19,710	$	15,485

SCHEDULE 3
COMVERGE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
	September 30,			December 31,
	2009			2008
Assets
Cash and cash equivalents	$	22,799		$	19,571
Restricted cash		1,000			1,968
Marketable securities		27,170			28,276
Accounts receivable, net		11,963			18,877
Billed accounts receivable, net		18,963			5,908
Unbilled accounts receivable		6,123			4,960
Deferred costs		12,794			2,197
Other current assets		1,315			1,273
Total current assets		102,127			83,030
Restricted cash		3,096			2,089
Property and equipment, net		22,215			20,572
Intangible assets, net		9,488			10,251
Goodwill		8,179			8,179
Other assets		848			1,036
Total assets	$	145,953		$	125,157
Liabilities and Shareholders' Equity
Accounts payable		6,511			7,672
Accrued expenses		16,343			8,006
Deferred revenue		27,327			6,694
Current portion of long-term debt		4,012			3,226
Other current liabilities		6,778			2,400
Total current liabilities		60,971			27,998
Deferred revenue		2,525			2,220
Long-term debt		32,654			24,888
Other liabilities		2,877			2,391
Total long-term liabilities		38,056			29,499
Common stock		22			22
Additional paid-in capital		227,700			220,638
Common stock held in treasury		(211	)		(119	)
Accumulated deficit		(180,650	)		(152,930	)
Accumulated other comprehensive income		65			49
Total shareholders' equity		46,926			67,660
Total liabilities and shareholders' equity	$	145,953		$	125,157

SCHEDULE 4
COMVERGE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2009			2008			2009			2008
Cash flows from operating activities
Net loss	$	(9,444	)	$	(81,769	)	$	(27,720	)	$	(100,206	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities
Depreciation		298			289			810			664
Amortization of intangible assets		724			610			2,089			1,922
Stock-based compensation		3,986			1,664			6,803			5,416
Impairment charges		-			75,432			-			75,432
Other		136			(725	)		780			(693	)
Changes in working capital		1,512			8,571			23,860			6,846
Net cash provided by (used in) operating activities		(2,788	)		4,072			6,622			(10,619	)
Cash flows from investing activities
Changes in restricted cash		(928	)		1,790			(39	)		(722	)
Purchases of marketable securities		(10,296	)		(8,797	)		(24,777	)		(31,642	)
Maturities of marketable securities		4,500			6,346			25,750			35,826
Purchases of property and equipment		(4,425	)		(4,761	)		(13,011	)		(9,193	)
Cash paid for acquisitions, net		-			(48	)		-			(48	)
Net cash used in investing activities		(11,149	)		(5,470	)		(12,077	)		(5,779	)
Cash flows from financing activities
Borrowings under debt facilities, net		2,803			1,904			8,552			5,598
Other		128			95			131			(300	)
Net cash provided by financing activities		2,931			1,999			8,683			5,298
Net change in cash and cash equivalents		(11,006	)		601			3,228			(11,100	)
Cash and cash equivalents at beginning of period		33,805			28,054			19,571			39,755
Cash and cash equivalents at end of period	$	22,799		$	28,655		$	22,799		$	28,655

SCHEDULE 5
COMVERGE, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE TO THE
MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASURE
(In thousands)
(Unaudited)
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2009			2008			2009			2008
Net loss	$	(9,444	)	$	(81,769	)	$	(27,720	)	$	(100,206	)
Depreciation and amortization		1,022			899			2,899			2,586
Interest expense (income), net		459			171			1,007			(30	)
Provision (benefit) for income taxes,net		52			(1,140	)		159			(970	)
EBITDA		(7,911	)		(81,839	)		(23,655	)		(98,620	)
Non-cash stock compensation expense		3,986			1,664			6,803			5,416
Non-cash impairment charge		-			75,432			-			75,432
Adjusted EBITDA	$	(3,925	)	$	(4,743	)	$	(16,852	)	$	(17,772	)
See "Non-GAAP Financial Information" above in this earnings press release for information on the use of this Non-GAAP financial measure