Ideal Power Reports Third Quarter 2019 Financial Results
November 13 2019 - 4:01PM
Ideal Power Inc. (NASDAQ: IPWR), pioneering the development
and commercialization of highly efficient and broadly patented
B-TRAN™ bi-directional power switches, reported results for its
third quarter ended September 30, 2019.
Key Third Quarter 2019 and Subsequent B-TRAN™ Division
Highlights:
- Sold our Power Conversion Systems
(PCS) business and Power Packet Switching Architecture (PPSA™)
technology to CE+T Energy Solutions.
-
- Received a combination of cash,
CE+T Energy Solutions equity and the assumption of certain
liabilities; and
-
- Reduced cash burn to approximately
$700,000 per quarter, an approximately 60% reduction from our
average quarterly cash burn in 2018.
- Strengthened balance sheet through
the completion of a $3.5 million private placement subsequent to
the close of the third quarter 2019. We are now solely
focused on B-TRAN™ solid state switch commercialization.
- Completed testing of double-sided B-TRAN™ dies.
- Demonstrated bi-directional
operation with symmetrical performance in both directions;
- Measured forward voltage drop of
0.2V, consistent with our simulations. This value is substantially
lower than the corresponding junction voltage drop of approximately
1.75V for an IGBT switch;
and
- Measured breakdown voltages of up
to 1200V, a characteristic required for commercial, industrial and
military applications such as data centers, battery storage,
renewable energy and traction
drives.
- B-TRAN™ dies are being packaged for
use with a bi-directional driver to characterize switching
performance.
- Design basis and test results of
initial B-TRAN™ devices meet the criteria for our engineering
prototype sampling
program.
- B-TRAN™ Patent Estate: Currently
have 47 issued B-TRAN™ patents with 12 of those patents issued
outside North America. Significantly, our geographic coverage now
includes China, Japan and Europe. Our B-TRAN™ patent portfolio of
approximately 36 patent filings includes pending applications that
will enhance our coverage in the US, China, Japan and Europe and
potentially expand our coverage to include Korea and India.
Management Commentary
“The third quarter of 2019 was highlighted by
the completion of our PCS disposition allowing us to focus solely
on our proprietary B-TRAN™ power switch technology
commercialization,” said Dr. Lon Bell, Chief Executive Officer of
Ideal Power. “During the quarter we collaborated extensively with
semiconductor fabrication partners to manufacture B-TRAN™ wafers
for packaging and bench testing.
“Subsequent to the closing of the third quarter
and in conjunction with the recent B-TRAN progress, the Company was
able to fortify the balance sheet with $3.5 million in gross
proceeds from institutional investors and company management. I
personally contributed $500,000 to the offering, demonstrating my
confidence in the immense opportunity for our repositioned Company.
We look forward to sharing more on our commercial progress on our
year-end earnings call and upcoming investor conferences,”
concluded Bell.
Third Quarter 2019 Financial Results
- The company had no revenues from
continuing operations in the third quarter of 2019.
- Q3 2019 operating expenses were
$0.7 million compared to $1.2 million in Q3 2018. The decrease in
operating expense was primarily due to a decrease in our general
and administrative expenses impacted by our cost reduction plan,
inclusive of reduced headcount, and disposition of PCS
business.
- Q3 2019 net loss was $0.8 million,
compared to $2.2 million in Q3 2018.
- Q3 2019 cash used in operating
activities in Q3 2019 was $0.7 million compared to $1.4 million in
Q3 2018. Year-to-date Q3 2019 cash used in operating activities was
$2.4 million compared to $4.3 million in year-to-date Q3 2018.
- Cash and cash equivalents totaled
$0.8 million as of September 30, 2019, with no long-term debt
outstanding.
- Subsequent to the close of the
third quarter, the company entered into definitive agreements with
certain institutional and accredited investors, including Dr. Lon
E. Bell, Chief Executive Officer and Chairman of the Board of Ideal
Power, for a private placement of Ideal Power’s common stock (or
common stock equivalents) and warrants to purchase common stock for
aggregate gross proceeds of $3.5 million.
Conference Call Details
Ideal Power Chairman, CEO and President Dr. Lon
Bell, CFO Tim Burns and B-TRAN™ Chief Commercial Officer Dan Brdar
will host the conference call, which will be accompanied by a
presentation and followed by a question and answer period.
To access the call, please use the following
information:
Date: |
Wednesday, November 13, 2019 |
Time: |
4:30 p.m. ET, 1:30 p.m. PT |
Toll-free dial-in number: |
1-800-458-4148 |
International dial-in number:
|
1-323-794-2597 |
Conference ID: |
7385903 |
Presentation: |
Events Section of IR website here |
Please call the conference telephone number 5-10
minutes prior to the start time. An operator will register your
name and organization. If you have any difficulty connecting with
the conference call, please contact MZ Group at 1-949-491-8235.
The conference call will be broadcast live and
available for replay
at http://public.viavid.com/index.php?id=136767 and via
the investor relations section of the Company’s website
at www.IdealPower.com.
A replay of the conference call will be
available after 7:30 p.m. Eastern time through December 13,
2019.
Toll Free Replay Number: |
1-844-512-2921 |
International Replay Number: |
1-412-317-6671 |
Replay ID: |
7385903 |
About Ideal Power Inc. Ideal
Power (NASDAQ: IPWR) is pioneering the development of its broadly
patented bi-directional power switches, creating highly efficient
and ecofriendly energy control solutions for industrial,
alternative energy, military and automotive applications. The
company is focused on its patented Bi-directional, Bi-polar
Junction Transistor (B-TRAN™) semiconductor technology. B-TRAN™ is
a unique double-sided bi-directional AC switch able to deliver
substantial performance improvements over today's conventional
power semiconductors. Ideal Power believes B-TRAN™ modules will
reduce conduction and switching losses, complexity of thermal
management and operating cost in medium voltage AC power switching
and control circuitry. For more information,
visit www.IdealPower.com.
Safe Harbor Statement All
statements in this release that are not based on historical fact
are "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and the provisions of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. While Ideal
Power’s management has based any forward-looking statements
included in this release on its current expectations, the
information on which such expectations were based may change. These
forward-looking statements rely on a number of assumptions
concerning future events and are subject to a number of risks,
uncertainties and other factors, many of which are outside of our
control that could cause actual results to materially differ from
such statements. Such risks, uncertainties, and other factors
include, but are not limited to, the success of our B-TRAN™
technology, whether the patents for our technology provide adequate
protection and whether we can be successful in maintaining,
enforcing and defending our patents, our inability to predict with
precision or certainty the pace of development and
commercialization of our B-TRAN™ technology and uncertainties set
forth in our quarterly, annual and other reports filed with the
Securities and Exchange Commission. Furthermore, we operate in a
highly competitive and rapidly changing environment where new and
unanticipated risks may arise. Accordingly, investors should not
place any reliance on forward-looking statements as a prediction of
actual results. We disclaim any intention to, and undertake no
obligation to, update or revise forward-looking
statements. Ideal Power Investor
Relations Contact: MZ North America Chris
Tyson 949-491-8235 IPWR@mzgroup.us www.mzgroup.us
IDEAL POWER INC. Balance
Sheets
|
|
September 30, 2019 |
|
|
December 31, 2018 |
|
|
|
(unaudited) |
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
769,833 |
|
|
$ |
3,258,077 |
|
Prepayments and other current assets |
|
|
129,347 |
|
|
|
333,877 |
|
Current assets of discontinued operations held for sale |
|
|
– |
|
|
|
1,096,323 |
|
Total current assets |
|
|
899,180 |
|
|
|
4,688,277 |
|
|
|
|
|
|
|
|
|
|
Property and equipment,
net |
|
|
52,879 |
|
|
|
63,214 |
|
Intangible assets, net |
|
|
1,645,555 |
|
|
|
1,396,409 |
|
Right of use asset |
|
|
303,246 |
|
|
|
– |
|
Other assets |
|
|
17,920 |
|
|
|
17,920 |
|
Total assets |
|
$ |
2,918,780 |
|
|
$ |
6,165,820 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
195,540 |
|
|
$ |
94,203 |
|
Accrued expenses |
|
|
178,720 |
|
|
|
167,755 |
|
Current portion of lease liability |
|
|
177,669 |
|
|
|
– |
|
Current liabilities of discontinued operations held for sale |
|
|
– |
|
|
|
877,755 |
|
Total current liabilities |
|
|
551,929 |
|
|
|
1,139,713 |
|
|
|
|
|
|
|
|
|
|
Long-term lease liability |
|
|
129,995 |
|
|
|
– |
|
Other long-term
liabilities |
|
|
651,483 |
|
|
|
428,163 |
|
Total liabilities |
|
|
1,333,407 |
|
|
|
1,567,876 |
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
Preferred stock, $0.001 par value; 10,000,000 shares
authorized;810,000 shares issued and outstanding at September
30, 2019 and 1,518,430 shares issued and outstanding at December
31, 2018, respectively |
|
|
810 |
|
|
|
1,518 |
|
Common stock, $0.001 par value; 50,000,000 shares authorized;
1,475,322 shares issued and 1,474,001 shares outstanding at
September 30 30, 2019 and 1,404,479 shares issued and 1,403,158
shares outstanding at December 31, 2018, respectively |
|
|
1,475 |
|
|
|
1,404 |
|
Additional paid-in capital |
|
|
68,115,842 |
|
|
|
68,022,484 |
|
Treasury stock, at cost, 1,321 shares at September 30, 2019 and
December 31, 2018, respectively |
|
|
(13,210 |
) |
|
|
(13,210 |
) |
Accumulated deficit |
|
|
(66,519,544 |
) |
|
|
(63,414,252 |
) |
Total stockholders’ equity |
|
|
1,585,373 |
|
|
|
4,597,944 |
|
Total liabilities and stockholders’ equity |
|
$ |
2,918,780 |
|
|
$ |
6,165,820 |
|
IDEAL POWER INC.
Statements of Operations
(unaudited)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Product revenue |
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
Cost of product revenue |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
Gross profit |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
250,773 |
|
|
|
326,733 |
|
|
|
804,741 |
|
|
|
743,495 |
|
General and administrative |
|
|
471,272 |
|
|
|
911,763 |
|
|
|
1,520,325 |
|
|
|
2,597,174 |
|
Total operating expenses |
|
|
722,045 |
|
|
|
1,238,496 |
|
|
|
2,325,066 |
|
|
|
3,340,669 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing
operations before interest |
|
|
(722,045 |
) |
|
|
(1,238,496 |
) |
|
|
(2,325,066 |
) |
|
|
(3,340,669 |
) |
Interest (income) expense,
net |
|
|
2,763 |
|
|
|
112 |
|
|
|
3,072 |
|
|
|
(36,817 |
) |
Loss from continuing
operations |
|
|
(724,808 |
) |
|
|
(1,238,608 |
) |
|
|
(2,328,138 |
) |
|
|
(3,303,852 |
) |
Loss from discontinued
operations |
|
|
(78,796 |
) |
|
|
(1,011,315 |
) |
|
|
(768,047 |
) |
|
|
(2,724,679 |
) |
Loss on sale of discontinued
operations |
|
|
(9,107 |
) |
|
|
– |
|
|
|
(9,107 |
) |
|
|
– |
|
Net loss |
|
$ |
(812,711 |
) |
|
$ |
(2,249,923 |
) |
|
$ |
(3,105,292 |
) |
|
$ |
(6,028,531 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing
operations per share – basic and fully diluted |
|
$ |
(0.49 |
) |
|
$ |
(0.88 |
) |
|
$ |
(1.60 |
) |
|
$ |
(2.36 |
) |
Loss from discontinued
operations per share – basic and fully diluted |
|
|
(0.06 |
) |
|
|
(0.73 |
) |
|
|
(0.53 |
) |
|
|
(1.94 |
) |
Net loss per share – basic and
fully diluted |
|
$ |
(0.55 |
) |
|
$ |
(1.61 |
) |
|
$ |
(2.13 |
) |
|
$ |
(4.30 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of
shares outstanding – basic and fully diluted |
|
|
1,474,001 |
|
|
|
1,401,348 |
|
|
|
1,460,507 |
|
|
|
1,401,060 |
|
IDEAL POWER INC. Statements of Cash Flows
(unaudited)
|
|
Nine Months Ended September 30, |
|
|
|
2019 |
|
|
2018 |
|
Cash flows from operating
activities: |
|
|
|
|
|
|
|
|
Loss from continuing operations |
|
$ |
(2,328,138 |
) |
|
$ |
(3,303,852 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
82,913 |
|
|
|
109,845 |
|
Write-off of capitalized patents |
|
|
– |
|
|
|
10,873 |
|
Stock-based compensation |
|
|
156,882 |
|
|
|
645,349 |
|
Decrease in operating assets: |
|
|
|
|
|
|
|
|
Prepayments and other current assets |
|
|
204,530 |
|
|
|
186,764 |
|
Increase (decrease) in operating liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
|
1,337 |
|
|
|
192,352 |
|
Accrued expenses |
|
|
6,336 |
|
|
|
(108,489 |
) |
Net cash used in operating activities |
|
|
(1,876,140 |
) |
|
|
(2,267,158 |
) |
Net cash used in operating activities – discontinued
operations |
|
|
(557,096 |
) |
|
|
(2,076,842 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from investing
activities: |
|
|
|
|
|
|
|
|
Purchase of property and equipment |
|
|
(4,253 |
) |
|
|
(1,088 |
) |
Acquisition of intangible assets |
|
|
(74,342 |
) |
|
|
(85,913 |
) |
Net cash used in investing activities |
|
|
(78,595 |
) |
|
|
(87,001 |
) |
Net cash provided by (used in) investing activities – discontinued
operations |
|
|
23,587 |
|
|
|
(49,865 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from financing
activities: |
|
|
|
|
|
|
|
|
Payment of taxes related to restricted stock vesting |
|
|
– |
|
|
|
(2,616 |
) |
Net cash used in financing activities |
|
|
– |
|
|
|
(2,616 |
) |
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash
equivalents – continuing operations |
|
|
(1,954,735 |
) |
|
|
(2,356,775 |
) |
Net decrease in cash and cash
equivalents – discontinued operations |
|
|
(533,509 |
) |
|
|
(2,126,707 |
) |
Cash and cash equivalents at
beginning of period |
|
|
3,258,077 |
|
|
|
10,022,247 |
|
Cash and cash equivalents at
end of period |
|
$ |
769,833 |
|
|
$ |
5,538,765 |
|
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