AETI American Electric Technologies Inc

American Electric Technologies, Inc. (NASDAQ:AETI), a leading supplier of power delivery solutions for the global energy industry, today announced its first quarter 2017 financial results.

The company reported quarter ending backlog of $26.6 million, the company’s second highest backlog ever reported and the highest since Q3 2014.  

For the quarter, the company reported revenue of $8.0 million, down 14% from Q4 and 3% from the $8.3 million revenue reported in Q1 2016.  The revenue decrease was primarily related to the general oil & gas market conditions combined with the seasonality of our services business and the impact of the significant backlog growth reported was not reflected in revenues in Q1.

Based on the reduced revenue level, the Company reported an EBITDA loss (a non-U.S. GAAP measure) of $2.2 million for the quarter, compared with an EBITDA loss of $1.4 million in Q4 2016 and improved from the EBITDA loss of $2.7 million in Q1 of 2016.

“We were pleased with the strong increased bookings and the refinancing of our credit facility in Q1. However, our markets continue to be very challenging and liquidity remains tight,” said Charles Dauber, AETI president and chief executive officer. “Although our Q1 revenues were below our break-even level, the projects that comprise our backlog will commence being recognized for revenue starting in Q2.”

The 97% backlog growth compared with Q4 2016 ending backlog was primarily driven by orders in the midstream and downstream oil & gas and power generation markets. The Company previously announced project awards in the quarter including a $5M break-in win at a top 5 largest Engineering, Procurement and Construction firm for a new chemical plant project, and a $6M contract with a leading midstream operator to enhance electrical safety for their Permian Crude Pipeline and Terminal projects using the company’s IntelliSafe™ arc-resistant switchgear.

On March 27th, the company announced it has closed on a new $7.0M credit facility with Hunting Dog Capital of San Francisco. This new credit facility will be used to refinance existing debt and for general corporate purposes.

Conference Call AETI will conduct a conference call at 11 a.m. EDT on May 15, 2017 to discuss the results with analysts, investors and other interested parties. Individuals who wish to participate in the conference call should dial 866-454-4207 passcode 934089, in the United States and Canada.  International callers should dial +1 913-312-9312 passcode 934089.

American Electric Technologies, Inc. (NASDAQ:AETI) is a leading provider of power delivery solutions to the global energy industry. AETI offers M&I Electric™ power distribution and control products, electrical services, and construction services.

AETI is headquartered in Houston and has global sales, support and manufacturing operations in Beaumont, Texas and Houma, Louisiana; and Rio de Janeiro, Macaé and Belo Horizonte, Brazil.  In addition, AETI has minority interests in two joint ventures, which have facilities located in Xian, China and Singapore. AETI's SEC filings, news and product/service information are available at www.aeti.com.

Forward Looking StatementsThis press release contains forward-looking statements, as defined in Section 27A of the Securities Exchange Act of 1934, concerning anticipated future domestic and international demand for our products, and other future plans and objectives. While the Company believes that such forward-looking statements are based on reasonable assumptions, there can be no assurance that such future revenues, profits, plans and objectives will be achieved on schedule or in the amounts indicated. Investors are cautioned that these forward-looking statements are not guarantees of future performance. Actual events or results may differ from the Company’s expectations, and are subject to various risks and uncertainties, including those listed in Item 1A of the Form 10-K filed with the Securities and Exchange Commission on March 30, 2017. The Company assumes no obligation to publicly update or revise its forward-looking statements even if experience or future events make it clear that any of the projected results expressed or implied herein will not be realized.

American Electric Technologies, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
	March 31, 2017				December 31,
	(unaudited)					2016
Assets
Current assets:
Cash and cash equivalents	$	1,559			$	1,618
Restricted short-term investments		507				507
Accounts receivable-trade, net of allowance of $ and $204 at March 31, 2017 and December 31, 2016		5,110				6,717
Inventories, net of allowance of $134 and $60 at March 31, 2017 and December 31, 2016		958				1,181
Cost and estimated earnings in excess of billings on uncompleted contracts		6,170				5,829
Prepaid expenses and other current assets		422				349
Total current assets		14,726				16,201
Property, plant and equipment, net		7,187				7,298
Advances to and investments in foreign joint ventures		10,730				10,663
Retainage receivable		649				649
Intangibles		510				527
Other assets		74				46
Total assets	$	33,876			$	35,384
Liabilities, Convertible Preferred Stock and Stockholders’ Equity
Current liabilities:
Revolving line of credit	$	-			$	1,500
Current portion of long-term note payable		500				300
Accounts payable and other accrued expenses		9,001				9,798
Accrued payroll and benefits		1,018				1,093
Billings in excess of costs and estimated earnings on uncompleted contracts		716				208
Total current liabilities		11,235				12,899
Long-term note payable		6,166				3,900
Deferred compensation		248				260
Deferred income taxes		2,864				2,824
Total liabilities		20,513				19,883
Convertible preferred stock:
Redeemable convertible preferred stock, Series A, net of discount of $631 at March 31, 2017 and $671 at December 31, 2016; $0.001 par value, 1,000,000 shares authorized, issued and outstanding at March 31, 2017 and December 31, 2016		4,396				4,383
Stockholders’ equity:
Common stock; $0.001 par value, 50,000,000 shares authorized, 8,480,118 and 8,499,508 shares issued and 8,292,753 and 8,335,968 shares outstanding at March 31, 2017 and December 31, 2016		8				8
Treasury stock, at cost 145,877 shares at March 31, 2017 and 131,928 shares at December 31, 2016		(863	)			(863	)
Additional paid-in capital		13,005				12,613
Accumulated other comprehensive income		39				(2	)
Retained earnings; including accumulated statutory reserves in equity method investments of $2,809 and $2,887 at March 31, 2017 and December 31, 2016		(3,222	)			(638	)
Total stockholders’ equity		8,967				11,118
Total liabilities, convertible preferred stock and stockholders’ equity	$	33,876			$	35,384

American Electric Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
Unaudited
(in thousands, except share and per share data)
	Three Months Ended March 31,
		2017				2016
Net sales	$	8,030			$	8,298
Cost of sales		8,586				8,207
Gross margin		(556	)			91
Operating expenses:
Research and development		104				523
Selling and marketing		611				876
General and administrative		1,094				1,346
Total operating expenses		1,809				2,745
Income (loss) from operations		(2,365	)			(2,654	)
Net equity income (loss) from foreign joint ventures’ operations:
Equity income (loss) from foreign joint ventures’ operations		52				(195	)
Foreign joint ventures’ operations related expenses		(64	)			(51	)
Net equity loss from foreign joint ventures’ operations		(12	)			(246	)
Loss from operations and net equity income from foreign joint ventures’ operations		(2,377	)			(2,900	)
Other income (expense):
Interest expense and other, net		(100	)			(39	)
Loss before income taxes		(2,477	)			(2,939	)
Provision for (benefit from) income taxes		18				(56	)
Net loss before dividends on redeemable convertible preferred stock		(2,495	)			(2,883	)
Dividends on redeemable convertible preferred stock		(89	)			(88	)
Net loss attributable to common stockholders	$	(2,584	)		$	(2,971	)
Earnings (loss) per common share:
Basic	$	(0.31	)		$	(0.36	)
Diluted	$	(0.31	)		$	(0.36	)
Weighted - average number of common shares outstanding:
Basic		8,337,119				8,263,223
Diluted		8,337,119				8,263,223

  

American Electric Technologies, Inc. and Subsidiaries
Non-GAAP Financial Measures and Reconciliations
Computation of Earnings on Continuing Operations, Including Net Equity Income from Foreign Joint Ventures, Before Interest,
Dividends, Taxes, Depreciation and Amortization ("EBITDA")
Unaudited
(in thousands)
	Three Months Ended March 31,
		2017				2016
Net income (loss) attributable to common stockholders	$	(2,584	)		$	(2,971	)
Add: Depreciation and amortization		218				221
Interest expense		100				45
Provision for (benefit from) income taxes		18				(56	)
Dividend on redeemable preferred stock		89				88
EBITDA	$	(2,159	)		$	(2,673	)
The Company is disclosing EBITDA, which is a non-GAAP measure, because it is used by management and provided to investors to provide comparability of underlying operational results. For more discussion of the use and limitations of EBITDA, see the 2016 10-K which was filed on March 30, 2017.

 

Investor Contact: 
American Electric Technologies, Inc. 
Bill Brod
713-644-8182 
investorrelations@aeti.com