Exhibit 99.1
Capstone Turbine Reports 3rd Quarter
Revenue Up 23% Over 2nd Quarter
CHATSWORTH, Calif.--(BUSINESS WIRE)--Feb. 9, 2006--Capstone
Turbine Corporation(R) (Nasdaq:CPST) (www.microturbine.com) reported
results for the third quarter of fiscal year 2006 on Form 10-Q filed
with the Securities and Exchange Commission on February 9, 2006.
Revenues increased to $7.0 million for the third quarter, up over
50% from the prior year comparable quarter, with backlog increasing
over 60%.
Financial Summary
Capstone's revenues increased to $7.0 million for the third
quarter, up over 50% from the prior year comparable quarter, and up
23% from the second quarter. The increase indicates growing market
acceptance and increased adoption rate. Backlog at the end of the
third quarter was $10.1 million, an increase of over 60% from the
prior year comparable quarter, down sequentially 20% from the second
quarter. The decrease was a reflection of the delay in the New York
City Department of Buildings' Materials Equipment Acceptance
application approval that was expected to be finalized in the quarter.
The reported gross loss was $2.8 million, or 39% of revenue, for
the third quarter of fiscal 2006, compared to $2.1 million, or 46% of
revenue, for the third quarter of fiscal 2005. The gross loss
increased $1.7 million from the $1.1 million loss reported for the
second quarter of fiscal 2006. The benefit of increased revenues in
the quarter was offset by changes in product enhancement program
reserves and inventory valuation charges.
Research and development costs were $3.1 million for the third
quarter, up $0.4 million from the prior quarter. The increase is
attributable to spending related to work on government cost sharing
programs.
Selling, general and administrative costs were $9.0 million for
the third quarter and include a $2.0 million charge related to the
settlement agreement with Interstate Companies. Excluding the
settlement charge, this was an increase of approximately $0.2 million
from the second quarter.
Capstone's net loss was $14.2 million, or $0.14 per share, for the
third quarter of fiscal 2006, an increase of $4.0 million from the
$10.2 million loss, or $0.12 per share, reported for the second
quarter of fiscal 2006. Included in the $0.14 per share net loss was
the $2.0 million settlement charge.
Cash balances increased $22.1 million in the third quarter from
the $44.1 million balance at the end of the prior quarter. The
increased cash balance is a result of the registered direct offering
of the Company's common stock completed in October 2005, resulting in
net proceeds of approximately $39.1 million.
Cash and cash equivalents at the end of the quarter were $66.2
million.
Business Summary
John Tucker, Capstone's President and CEO, said "Our team is
continuing to move forward on our mission to becoming the world leader
in distributed power generation. I am pleased with our most recent
accomplishments and their importance in moving us closer to achieving
our mission."
Listed below is a brief summary of our recent operating
accomplishments:
Negotiated and signed a Memorandum of Understanding (MOU) with
Broad USA, Inc. to jointly develop fully integrated cogeneration
(CCHP) systems. Broad specializes in the design and manufacture of
absorption chillers powered by clean and recyclable energies. Broad is
headquartered in Beijing, China with its U.S. headquarters located in
Hackensack, New Jersey. Their products are sold in over 30 countries,
hold a greater than 50% market share in China, and are market leaders
in absorption chilling in the United States and Europe. (Jan. 31,
2006.)
Increased strength of New York sales force by naming Bruce
Beckwith as Regional Vice-President of Sales. Beckwith will be
responsible for Capstone's sales and service activities for the
Northeast region of the U.S. Beckwith joins the Capstone team from
WESCO (Liberty Electric), where he was their Maspeth, Queens Branch
Manager of Major Projects. Prior to joining WESCO, Beckwith worked for
over 30 years in the New York electrical contracting industry. (Jan.
25, 2006.)
Capstone-branded products have been approved by the General
Services Administration (GSA) and are now on the GSA Schedule. The GSA
approval provides the opportunity for federal end-user customers to
negotiate and acquire products and services from commercial suppliers.
Capstone has been approved on the GSA Schedule for five (5) years,
from January 1, 2006, through January 1, 2011. (Jan. 24, 2006.)
Richard Atkinson was appointed to Capstone's Board of Directors.
Atkinson is Vice-President, CFO and Corporate Secretary of Pope &
Talbot, a wood and pulp products business headquartered in Portland,
Oregon. Before joining Pope & Talbot two years ago, Atkinson was with
Sierra Pacific Resources for more than 20 years, most recently as its
Vice-President, CFO and Treasurer. Sierra Pacific Resources is the
holding company for Nevada Power and Sierra Pacific Power, which
provide electric service to most of the state of Nevada and portions
of eastern California. Sierra Pacific Power is also an interstate
natural gas transmission line originating in Oregon and is a supplier
of natural gas to the Reno-Sparks region. (Dec. 9, 2005.)
Announced at the Power-Gen International trade show that the
Company will begin shipping an enhanced line of 65-kilowatt
microturbine models. The new natural gas fueled C65 and C65-ICHP (with
factory-integrated heat recovery) will deliver higher electrical and
thermal output without any change to the product's weight and
dimensions, which are much lighter and more compact than similar
capacity generators. This reduces footprint requirements and enables
greater flexibility in indoor, outdoor and rooftop siting. (Dec. 6,
2005.)
Conference Call
The Company will host a conference call today, Thursday, February
9, at 1:45 p.m. Pacific Time. Access to the live broadcast and a
replay of the webcast will be available for 90 days through the
Company's website: www.microturbine.com/ir.
About Capstone Turbine
Capstone Turbine Corporation (www.microturbine.com) (NASDAQ:CPST)
is the world's leading producer of low-emission microturbine systems,
and was the first to market commercially viable microturbine energy
products. Capstone Turbine has shipped more than 3,200 Capstone
MicroTurbine systems to customers worldwide. These award-winning
systems have logged more than 10 million documented runtime operating
hours. Capstone Turbine is a member of the U.S. Environmental
Protection Agency's Combined Heat and Power Partnership, which is
committed to improving the efficiency of the nation's energy
infrastructure and reducing emissions of pollutants and greenhouse
gases. A UL-Certified ISO 9001:2000 certified company, Capstone
Turbine is headquartered in the Los Angeles area with sales and/or
service centers in New York, Mexico City, Milan, Shanghai and Tokyo.
"Capstone Turbine Corporation" and "Capstone MicroTurbine" are
registered trademarks of Capstone Turbine Corporation. All other
trademarks mentioned are the property of their respective owners.
This press release contains "forward-looking statements," as that
term is used in the federal securities laws, with regard to business
growth generally, as well as the operating characteristics of the C65
models. Forward-looking statements may be identified by words such as
"expects," "objective," "intend," "targeted," "plan," "driving to" and
similar phrases. These forward-looking statements are subject to
numerous assumptions, risks and uncertainties, including the fact that
the Broad USA, Inc. MOU is subject to a definitive agreement and other
factors described in Capstone's filings with the Securities and
Exchange Commission that may cause Capstone's actual results to be
materially different from any future results expressed or implied in
such statements. Capstone cautions readers not to place undue reliance
on these forward-looking statements, which speak only as of the date
of this release. Capstone undertakes no obligation, and specifically
disclaims any obligation, to release any revisions to any
forward-looking statements to reflect events or circumstances after
the date of this release or to reflect the occurrence of unanticipated
events.
CAPSTONE TURBINE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
December 31, March 31,
2005 2005
------------ -----------
(Unaudited)
Assets
Current Assets:
Cash and cash equivalents $66,190 $63,593
Accounts receivable, net of allowance for
doubtful accounts and sales returns of
$779 at December 31, 2005 and $536 at
March 31, 2005 5,949 3,150
Inventories 14,702 11,273
Prepaid expenses and other current assets 932 992
Total current assets 87,773 79,008
Equipment and Leasehold Improvements, net 8,519 10,529
Non-Current Portion of Inventories 2,939 3,990
Intangible Asset, net and Other Long-Term Assets 1,469 1,663
Total $100,700 $95,190
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable and accrued expenses $6,835 $5,796
Accrued salaries and wages 1,109 1,442
Accrued warranty reserve 7,984 8,667
Deferred revenue 1,419 1,522
Current portion of notes payable and
capital lease obligations 19 19
Total current liabilities 17,366 17,446
Long-Term Portion of Notes Payable and Capital
Lease Obligations 50 64
Other Long-Term Liabilities 690 1,002
Stockholders' Equity:
Preferred stock, $.001 par value;
10,000,000 shares authorized; none issued -- --
Common stock, $.001 par value; 415,000,000
shares authorized; 103,252,461 shares
issued and 102,701,253 shares outstanding
at December 31, 2005; 85,379,446 shares
issued and 84,828,238 shares outstanding
at March 31, 2005 103 85
Additional paid-in capital 571,963 530,931
Accumulated deficit (488,714) (453,469)
Deferred stock compensation (245) (356)
Treasury stock, at cost; 551,208 shares (513) (513)
Total stockholders' equity 82,594 76,678
Total $100,700 $95,190
CAPSTONE TURBINE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Nine
Months Ended Months Ended
December 31, December 31,
2005 2004 2005 2004
(Unaudited)
Revenue $ 7,040 $ 4,683 $ 16,552 $ 11,563
Cost of Goods Sold 9,793 6,829 23,785 18,299
Gross Loss (2,753) (2,146) (7,233) (6,736)
Operating Expenses:
Research and development 3,093 2,793 7,926 9,126
Selling, general and
administrative 9,045 5,210 21,570 14,856
Total operating expenses 12,138 8,003 29,496 23,982
Loss from Operations (14,891) (10,149) (36,729) (30,718)
Interest income 708 378 1,481 937
Interest expense (1) (2) (22) (37)
Other Income 3 3 27 369
Loss Before Income Taxes (14,181) (9,770) (35,243) (29,449)
Provision for Income Taxes -- -- 2 2
Net Loss $ (14,181) $(9,770) $(35,245) $(29,451)
Net Loss Per Share of Common
Stock - Basic and Diluted $ (0.14) $ (0.12) $ (0.39) $ (0.35)
Weighted Average Shares Used
to Calculate Basic and
Diluted Net Loss Per Share 102,341 84,412 90,624 84,337
CONTACT: Capstone Turbine Corporation
Investor and investment media inquiries:
Alice Barsoomian, 818-407-3628