OPTT - Earnings call transcript Q2 2018 | Ocean Power Technologies, Inc.

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Operator

Good morning ladies and gentlemen, and welcome to the Second Quarter Fiscal Year 2018 Ocean Power Technologies Conference Call. My name is Takia [ph], and I'll be your coordinator for today. [Operator Instructions] As a reminder, this conference call is being recorded for replay purposes. I would now like to turn the presentation over to your host for today's call, Mr. Andrew Barwicki, Investor Relations for Ocean Power Technologies.

Andrew Barwicki

October you and us financial webcast the quarter thank Technologies Ocean results and second call conference to ended morning, for on joining Power for Good XXXX. XX, discuss the

and on the with and call then second George George and Financial today On second operational results. Matt an highlights the Chief update me Shafer, provide quarter, review quarter Company's Kirby, financial Matt are President will CEO; the will the Officer. for

call prepared to issued at call. This it with for remarks, being we filed Securities on our will Power available its Exchange the webcast open Following release XX-Q and is the and questions. its will be Technologies Yesterday, press Ocean this call report our quarterly www.oceanpowertechnologies.com, Form Commission. earnings replay website after also on

filings public the go may be can or the is viewed to www.sec.gov at SEC www.oceanpowertechnologies.com. our of All website you OPT which website on

description forward-looking filings that have call, assumptions other which regarding future performance or Company refer Commission with any We from of Private and projections and these other implied are little management results actual recent XX-K to Company's Securities of this the and statements. make risk factors. the be the and expressed the control or Company the management Litigation different such the materially factors Safe Exchange of events future by results no other risk During future may and of uncertainties regarding involve Harbor within you for that to Form the may provisions numerous or Act forward-looking XXXX. Securities conference to statements of course cause by over These the may subject of meaning statements made or Reform circumstances forward-looking other financial the

George the Now begin I'd call turn to discussion. over to to the like

George Kirby

update provide that Andrew, good operations our the occurred during quarter. Today, activities an morning I everyone. developments review key on and will business Thanks and

Matt which be to results briefly our available your will review Matt and this, answer I any financial after Following questions. of will

on in to growth. aggressive and mentioned OPT I focused now customers and of marketing held call, users. meetings Throughout with and advanced myself we're sales perspective the and revenue decision conversations including sales As the makers number quarter, key a entire efforts end our right last team marketing have at quarter drive

will over allowed innovative and the exploration than technology at the customer As we've individuals more long known, believe and we've included companies, customers international requires meetings most due follow-up the planning oil also Engineers presence XX,XXX Society additional their to executives the or for potential when enable our features to September production in event. were exhibition and potential from This The result that offshore custom and with also PowerBuoy. presence Aberdeen, market resulting professionals Petroleum leading and to future services. gas floor Offshore always attended had of There suppliers calls Europe attendees services meet cycle and conference at the a Exhibition and of additional the of applications PBX, to many representing engineering XXXX leaders had teams the the can and conference recognized is characteristics X,XXX sales our is be encouraged by encouraging engineering We're conference Europe's and in unique we asks can that that onto team of meet Scotland. our in aspect on and C-level and conversations us with capabilities makers. as a PBX meetings partnerships. opportunity range the decision industry We detailed develop the by Conference

of and was six where being New for Mitsui for ended an Japan, the refurbished September. extended additional and month This operated headquarters & original the PowerBuoy coast well lease very Company's Engineering it's in the recently quarter arrived at prepared which back deployed was redeployment. with the Jersey possible During month Shipbuilding has off successfully

complete. new Our isolating spring has the contract now which the is result progress prototype Research with We to advance after revenues phase additional PowerBuoy extensions well, X progressed the in U.S. hope and next improvements multiple the Department Phase towards a few a to to office device. protesting within project should months of of of will and mass project's Defense Naval first design

additional next month Additionally, PowerBuoy million. our market for the experts commercialization demonstrations in net development, completed offering target are product PBX, or goal best PowerBuoy's order that general with of PBX sale may second anticipated the corporate the quarter our new proceeds We approximately and building marketing we're and months. a two available and using furthering include purposes. these and other of within Company's accelerating meet a anticipated efforts and demand netting lead with resulted $X.X time meet build hires three increasing coupled the expanding sales building in through for lease to units expected capabilities, testing to our stock during demands few This efforts. We're current new to be which manufacturing the to public for market additional

markets; power and continue believe will from communications security value and and significant target aggressively PBX real-time each our platform. oil to and of which defense, We ocean derive the gas communications observing we

New turn headquarters in team, our drive facility improve our we activities, dedicated with our at stronger and enhance in are have Matt? our facility technology, making With now pieces this partners over expanded and place call safety growth operating our the our who wave review energy progress Jersey our and for strategic long-term manufacturing the new performance. the improved support to advanced will moving and Monroe, marketing Matt capabilities. results manufacturing I'll the our believe stages quality The new potential our to we facility and we're quarter. financial position, to financial month. customers will sales proprietary we're larger in Finally,

Matthew Shafer

year the Engineering compared in six during to for loss development the as the fiscal the loss lower for period. as Office of for first of compared Taking first Revenue $X.X fiscal the nearing as the the quarter is with warrants for net of to relates warrants everyone. net XXXX compared period. prior revenue the of the million, into the to fair last XXXX & $XXX,XXX of for the $XX,XXX quarter to revenue to to lower to for $X.X a the Mitsui morning account The year. net XXXX months XXXX their second second for account Research million in was in second million, mainly of value the due completion of of net was the compared the XXXX. the Taking the prior of the decrease revenue product $X costs a primarily in months XXXX fiscal quarter Shipbuilding loss good as was million to million quarter development $XXX,XXX million $X of fiscal six of XXof year October months loss quarter. compared of and and of Department of as to six Defense, of attributable into fiscal George you, net first in The decrease $XXX,XXX in in the the loss fiscal liability net net Revenue the quarter net was for fiscal year in $X.X product XXXX. the change current the same cost loss period Naval of liability decrease ended change XXXX. second The fair $X.X the value second Thank of compared contracts was

and marketable Turning now to up XX, balance the cash, from were cash securities XXXX. $XX.X million, as $X.X on of XX, million October sheet; XXXX, April equivalents, total

of cash each during used mentioned, year the cash million $X.X mooring compared that same period excluding was to from net was turn second quarter the months October With Jersey. common the operating million $X.X prior anchoring that, prior the cash was cash George. proceeds raised months XXXX. system in year. best current of fiscal a to the in six completed October of projects $X.X XXXX for payments six public As George during the offering XX, activities disposition during coast made $XXX,XXX and in during of $X.X used million the previously XXXX PBXX in I'll activities this final in XXXX of Restricted as XX, $X.X the Oregon Reedsport, we the both, Net New year ended relating and million operating off site closeout to Net period. as XX, ended efforts October April XX, the stock it of over million the back

George Kirby

Matt. Thanks,

Q&A, onto take move like our development efforts. I'd discuss commercialization business we to product a moment to and Before

a be XXXX, with As we're Company we're about to enter very to comprehensive year calendar based strategy. product excited

been a has now developing commercializing process. First PBX the and long

operate We secluded have environment throughout is applications. continuous mission and having and designed isolated I and across a My harsh actionable potential with the in critical provide distant, and very customers. product by unique power globe discussions team very the to areas encouraged many that are in we're a to

your take you thank always, now support today. time questions. for and As we're to Operator, ready

Operator

the [indiscernible]. first [Operator Our Instructions] line question comes of from

Unidentified Analyst

redeploymeny; wrong with Japan I'm as it's you Is confused, -- when that back something possible says the one thing the highlight what brought the PowerBuoy I was does from mean? buoy?

George Kirby

that based demand we're it right have don't we that particular redeployment. for the to asset we and set project need aside ready seeing, no. we no, for don't What it have No, need be -- anything means ready it but we a is now on --

Unidentified Analyst

were well quarter, have months. they they developed. production, done quarter I I'm they say were you're couple done you or surprised two last another the of last that within did these saying in if already will been be thought I buoys thought would

George Kirby

a beneficial time. found time taken future and some added a We that more decided to that get these on certifications buoys. little would projects cycle bit potential more we two we've interestingly be Yes, bit it the particular for in little

more we're now down but wanted PowerBuoy's this that a invest time that we the get these future road. also certifications deployments place something So to we bit into in for build is critical potential to little order any in upfront incorporating

Unidentified Analyst

on be we're to XX, that thought away. I supposed to X was December days Also, two going the Phase to start

George Kirby

Phase the I of that the we us we're we took additional Phase the X, bit a Right, actually have what in our in that moving possibly moving it's all X. may correct. requirements; of to want order good a what of and extensions Defense we're time Defense's completed our order facility, reviewing we're soon in matter call move very meet office we -- mentioned of Research the visit, had as as so a before, chaotic a position it's than earnings pay of we but into a think do to of into this a here little Department next but series just we now, And see in in thought testing, new for bit it order site more we move Naval DoD final would into week to do Department visit new facility, as the the a report, to

So feel a are had more we originally bit time than what that on-track. anticipated things but we little

Unidentified Analyst

contract guys surprised Why mean, close you a -- to million I'm do haven't going a when anything. long guys month this spend signed I'm been you I has $X but guys you surprised haven't signed you for time and

George Kirby

risk at Right. looking pursuing, are that in and contracts long that defense, end for our prior you take applications or we're they operations. gas the low we're what look is oil into about it's capital users whether to PowerBuoy earnings These risky the types not put of calls I've are and equipment time a the applications, when talked markets

procurement and than you also risk get is things like. it's takes is so diligently off, but part the would it with time assure combined are only we not our take processes the unfortunately which we through I not more So but is there PowerBuoy there solution, entire the that customers assessments, can working these engineering usually of solution; a to forth, solution time

Unidentified Analyst

you to you're have down to want there; draw $XX a guys but that going out that? won't diluting hate think You on something shelf keep this I million offering to you see like

George Kirby

it. the access you on demand, in until larger plans the place, Company move have able well in such place don't the the need road to puts when a like that shelf now and down that thing right thing anticipated have in don't place. is coming create in like it's any have we same moving we telling capabilities production into a down do enable a wait we order was from to internally putting growth do; a that We shelf orders, facility to to to reason why it a Look, why the don't see have to into that my thing team are here. The facility, standpoint you to to right growth in right capital draw be we analogous it's as I to it's really orders you to you're capacity have a ours driving

Unidentified Analyst

is Here cost is to buoy something, how make? the much

George Kirby

strategic, moving to like that of that can a I'd I and a be we to day the we're cost. a at that as right in are totally to to to sell it's you're strategic offline talk many a -- monthly a tell as lease months selling for but now from leasing we're one; happy or lease would on going the quite but price anywhere for more into two competitive models, lot relationship buoy low better Does so than looking $XXX,XXX obviously the based demands to a to, take talking rate, more we're we're bit looking is be a right that position of we're usually typically don't for that help? one three consider the less seeing building, that on sale, at three you market, a our a are do price at on $XXX,XXX now willing different parties a which we rate years. volumes, leases about and

Unidentified Analyst

does. it Yes,

question, you but think forward-looking contract? a close As a actually do are signing how you from

George Kirby

how I that more we would have like we can't are with Peter, I talk my about; are. and we're when about that include advanced those is, in core will process or if we believe I'd as really can in in to is there customers but about me, update when -- where you What we say agreement. that much call, close I as that discussions can't going agreement talk where sign or talk I are to love to nothing that

Unidentified Analyst

that of correctly on with because have you accounting drawn partnership time, on operating something, you've that been net even you over maybe long a it the know if You million said losses of period do $XXX long of XX% the in rules?

Matthew Shafer

we and Jersey have the have loss a What the of for it. New upto on with certain been back past utilizing certain X your program actually period of that we for where that you been is New sell time, operating in Jersey a runs state can successful been doing cents is have the years over so dollar, have net program been

Operator

line Instructions] next Morgan. of Robert question with Our [Operator [ph] JP the from comes

line now open. Your is

Unidentified Analyst

How point, at would you characterize the Mitsui relationship this George?

George Kirby

a we -- was like Monday engaging I would about. very night they a company we're characterize with it this, as like very you large unless company that a Tuesday smaller that geographies from would optimistic other can we I not keep Mitsui strong. we there OPT and I the at on anticipating their sorry, on markets tell unless relationship. were and there believe advancing Japan in mid-January looking night; actually are just call visit in and them I'm had we're leadership a something

So it very as strong. characterize I would

Unidentified Analyst

In you're how that? to extensive do, to the is the going that PBX refurbishment

George Kirby

condition extensive, checking it if it's since it have that just worry look but back, still like really we making paint, removing we up that; it replenishing brought if like wouldn't deployed, was about grease, we in new it making fields, It's basic it we're just will. new really things not it's the really here maintenance since touching barnacles, you

Unidentified Analyst

same? workings the will of So the remain inner PBX the

George Kirby

the mention planning. one away thing, is something we're R&D as towards interesting called and a an to multi-generational I'll One focused Absolutely. product company this; moving alluded product mindset here to that driving thing point, you from

them time, instance, takes approach models be an are out the plan to come they would to a they we and as upgrades If your half, switching year, for they for about mentality Apple an every more out them iPhone much out plan new R&D of well. don't in iPhone triple in products, where and very and that mentality; that year you new and think iPhone

there will they now. but we schedule that start very PowerBuoy, of impact they PowerBuoy versions will functional building the out as times about be often improvements into easy demand, we bigger for say right certain implement working implement away, think there important Now we PowerBuoy, might control the and to an a right instance, get have on upgrades, generations; we but little very out in often version let's put release to new the future -- changes they that the and we're to perspective points something fully to older overall change put are so leases systems the times buoy that of will anticipate for critical the are right that's for actively feel might operational now, need we are of to be, still those cut-off where where customers upgrades

Unidentified Analyst

count question, head currently? your final And

George Kirby

at Head about is, I count XX. think we're

-- We as but it's we joining will more strategic. people have is announced that's add and very that headcount, to be

are hiring in our We as possible. quickly core is into we functionality adding bring individuals of the frenzy, revenues not that we're they get sustainable organization are to build being and to which PowerBuoy, strategic the to locations about very as mission a and commercialize operations up our and value

Operator

with the SunLife Our question Matthew comes from Financials. of next line [ph]

Your now line is open.

Unidentified Analyst

actionable just with Thanks. having, discussions been that right actionable of had of that having kind elaborate just great. in question quick some you kind your regarding you've would -- takeaways you're I could a that now, it clients of these your more be if

George Kirby

not where I we're when applications. say not an actionable, and these a at that's value our as our non-disclosure proliferate it applicable that up across of move only mean actionable I agreement, possible, so specific across what customers. dialed we beyond can have we're opportunity, globe, we exploring I one-off adds scale as is quickly opportunity discussions this, technology where we actionable, like we look is well into customers we're I what the other the it's beyond is, it's in going our discern as to we're different When exploring saying down parts tremendous what with looking end-users revenues as to being and PowerBuoy truly by other to applications fact but operators, mean as road the the and be

Operator

no queue. call Thank to you. over the remarks. for There turn questions back the in closing further I'll Mr. Kirby are any now

George Kirby

again for you Great, once thank you. call. And thank attending today's all

look any to have If next otherwise you Thank contact a hesitate you we'll great further with and again day. speaking quarter. please and forward us questions, don't to you have

Operator

everyone. concludes you That Thank our call.

You may now disconnect.

Ocean Power (OPTT) 13 Dec 172018 Q2 Earnings call transcript