November 26, 2022

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AMSC Reports Third Quarter Fiscal Year 2020 Financial Results and Provides Business Outlook

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AYER, Mass., Feb 03, 2021 (GLOBE NEWSWIRE via COMTEX) —
AYER, Mass., Feb. 03, 2021 (GLOBE NEWSWIRE) — AMSC (Nasdaq: AMSC), a leading system provider of megawatt-scale power resiliency solutions that orchestrate the rhythm and harmony of power on the grid(TM), and protect and expand the capability and resiliency of our Navy’s fleet, today reported financial results for its third quarter of fiscal year 2020 ended December 31, 2020.

Revenues for the third quarter of fiscal 2020 were $23.6 million compared with $17.9 million for the same period of fiscal 2019. The year-over-year increase was a result of higher Grid and Wind segment revenues versus the year ago period. The higher Grid segment revenues were primarily due to revenues generated from our recent acquisition of Northeast Power Systems, Inc. The higher Wind segment revenues were a result of higher shipments of electrical control systems to Inox Wind.

AMSC’s net loss for the third quarter of fiscal 2020 was $7.9 million, or $0.31 per share, compared to a net loss of $6.8 million, or $0.32 per share, for the same period of fiscal 2019. The Company’s non-GAAP net loss for the third quarter of fiscal 2020 was $3.4 million, or $0.13 per share, compared with a non-GAAP net loss of $6.7 million, or $0.32 per share, in the same period of fiscal 2019. Please refer to the financial table below for a reconciliation of GAAP to non-GAAP results.

Cash, cash equivalents, marketable securities and restricted cash on December 31, 2020 totaled $84.4 million, compared with $57.7 million at September 30, 2020.

“Grid is driving revenue growth for the Company,” said Daniel P. McGahn, Chairman, President and CEO, AMSC. “We generated $1.7 million of positive operating cash flow in the third quarter of fiscal 2020, and ended the quarter with a strong balance sheet and an expanded portfolio of new energy power systems solutions expected to support growth.”

Business Outlook
For the fourth quarter ending March 31, 2021, AMSC expects that its revenues will be in the range of $18 million to $22 million. The Company’s net loss for the fourth quarter of fiscal 2020 is expected not to exceed $8.0 million, or $0.31 per share. The Company’s non-GAAP net loss (as defined below) is expected not to exceed $6.5 million, or $0.25 per share, excluding the impact from any changes in contingent consideration. The Company expects operating cash flow to be a burn of $2 million to $4 million in the fourth quarter of fiscal 2020. The Company expects cash, cash equivalents, marketable securities and restricted cash on March 31, 2021, to be no less than $80 million.

Conference Call Reminder
In conjunction with this announcement, AMSC management will participate in a conference call with investors beginning at 10:00 a.m. Eastern Time on Thursday, February 4, 2021, to discuss the Company’s financial results and business outlook. Those who wish to listen to the live or archived conference call webcast should visit the “Investors” section of the Company’s website at https://ir.amsc.com. The live call can also be accessed by dialing 866-269-4261 or 323-289-6576 and using conference ID 1666219. A replay of the call may be accessed 2 hours following the call by dialing 888-203-1112 or 719-457-0820 and using conference passcode 1666219.

About AMSC (Nasdaq: AMSC)
AMSC generates the ideas, technologies and solutions that meet the world’s demand for smarter, cleaner … better energy(TM). Through its Gridtec(TM) Solutions, AMSC provides the engineering planning services and advanced grid systems that optimize network reliability, efficiency and performance. Through its Marinetec(TM) Solutions, AMSC provides ship protection systems and is developing propulsion and power management solutions designed to help fleets increase system efficiencies, enhance power quality and boost operational safety. Through its Windtec(TM) Solutions, AMSC provides wind turbine electronic controls and systems, designs and engineering services that reduce the cost of wind energy. The Company’s solutions are enhancing the performance and reliability of power networks, increasing the operational safety of navy fleets, and powering gigawatts of renewable energy globally. Founded in 1987, AMSC is headquartered near Boston, Massachusetts with operations in Asia, Australia, Europe and North America. For more information, please visit www.amsc.com.

AMSC, American Superconductor, D-VAR, D-VAR VVO, Gridtec, Marinetec, Windtec, Smarter, Cleaner … Better Energy, and Orchestrate the Rhythm and Harmony of Power on the Grid are trademarks or registered trademarks of American Superconductor Corporation. All other brand names, product names, trademarks or service marks belong to their respective holders.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any statements in this release regarding our goals and strategies; our expected GAAP and non-GAAP financial results for the quarter ending March 31, 2021, our expected cash burn during the quarter ending March 31, 2021, our expected cash, cash equivalents, marketable securities and restricted cash balance on March 31, 2021, the benefits of the NEPSI acquisition, and other statements containing the words “believes,” “anticipates,” “plans,” “expects,” “will” and similar expressions, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements represent management’s current expectations and are inherently uncertain. There are a number of important factors that could materially impact the value of our common stock or cause actual results to differ materially from those indicated by such forward-looking statements. These important factors include, but are not limited to: We have a history of operating losses, which may continue in the future. Our operating results may fluctuate significantly from quarter to quarter and may fall below expectations in any particular fiscal quarter; We have a history of negative operating cash flows, and we may require additional financing in the future, which may not be available to us; We may be required to issue performance bonds or provide letters of credit, which restricts our ability to access any cash used as collateral for the bonds or letters of credit; Changes in exchange rates could adversely affect our results of operations; If we fail to maintain proper and effective internal control over financial reporting, or if we fail to remediate our current material weakness in our internal control over financial reporting our ability to produce accurate and timely financial statements could be impaired and may lead investors and other users to lose confidence in our financial data; We may not realize all of the sales expected from our backlog of orders and contracts; Our contracts with the U.S. government are subject to audit, modification or termination by the U.S. government and include certain other provisions in favor of the government. The continued funding of such contracts remains subject to annual congressional appropriation, which, if not approved, could reduce our revenue and lower or eliminate our profit; Our financial condition may have an adverse effect on our customer and supplier relationships; The novel coronavirus (COVID-19) pandemic could adversely impact our business, financial condition and results of operations;We may experience difficulties re-establishing our HTS wire production capability in our Ayer, Massachusetts facility; Our success is dependent upon attracting and retaining qualified personnel and our inability to do so could significantly damage our business and prospects; Historically, a significant portion of our revenues have been derived from a single customer and if this customer’s business is negatively affected, it could adversely impact our business; Our success in addressing the wind energy market is dependent on the manufacturers that license our designs;Our business and operations would be adversely impacted in the event of a failure or security breach of our information technology infrastructure; Failure to comply with evolving data privacy and data protection laws and regulations or to otherwise protect personal data, may adversely impact our business and financial results; We rely upon third-party suppliers for the components and subassemblies of many of our Grid and Wind products, making us vulnerable to supply shortages and price fluctuations, which could harm our business; Many of our revenue opportunities are dependent upon subcontractors and other business collaborators; If we fail to implement our business strategy successfully, our financial performance could be harmed; Problems with product quality or product performance may cause us to incur warranty expenses and may damage our market reputation and prevent us from achieving increased sales and market share; Many of our customers outside of the United States may be either directly or indirectly related to governmental entities, and we could be adversely affected by violations of the United States Foreign Corrupt Practices Act and similar worldwide anti-bribery laws outside the United States; We have had limited success marketing and selling our superconductor products and system-level solutions, and our failure to more broadly market and sell our products and solutions could lower our revenue and cash flow;We may acquire additional complementary businesses or technologies, which may require us to incur substantial costs for which we may never realize the anticipated benefits; Our success depends upon the commercial adoption of the REG system, which is currently limited, and a widespread commercial market for our products may not develop; Adverse changes in domestic and global economic conditions could adversely affect our operating results; We have operations in, and depend on sales in, emerging markets, including India, and global conditions could negatively affect our operating results or limit our ability to expand our operations outside of these markets. Changes in India’s political, social, regulatory and economic environment may affect our financial performance; Our products face competition, which could limit our ability to acquire or retain customers; Our international operations are subject to risks that we do not face in the United States, which could have an adverse effect on our operating results; Growth of the wind energy market depends largely on the availability and size of government subsidies, economic incentives and legislative programs designed to support the growth of wind energy; Lower prices for other fuel sources may reduce the demand for wind energy development, which could have a material adverse effect on our ability to grow our Wind business; Unfavorable results of legal proceedings could have a material adverse effect on our business, operating results and financial condition; We may be unable to adequately prevent disclosure of trade secrets and other proprietary information;Our patents may not provide meaningful protection for our technology, which could result in us losing some or all of our market position; We face risks related to our intellectual property; We face risks related to our technologies; We face risks related to our legal proceedings; We face risks related to our common stock; and the important factors discussed under the caption “Risk Factors” in Part 1. Item 1A of our Form 10-K for the fiscal year ended March 31, 2020, as updated in our Form 10-Q for the period ended December 31, 2020, and our other reports filed with the SEC. These important factors, among others, could cause actual results to differ materially from those indicated by forward-looking statements made herein and presented elsewhere by management from time to time. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)

Three Months Ended

Nine Months Ended

December 31,

December 31,

2020

2019

2020

2019

Revenues

Grid

$

17,086

$

15,232

$

51,149

$

36,577

Wind

6,546

2,683

14,812

9,120

Total revenues

23,632

17,915

65,961

45,697

Cost of revenues

19,676

16,329

51,444

38,770

Gross margin

3,956

1,586

14,517

6,927

Operating expenses:

Research and development

3,029

2,049

8,248

6,920

Selling, general and administrative

7,085

6,071

18,609

16,726

Amortization of acquisition-related intangibles

360

85

601

255

Change in fair value of contingent consideration

2,740

2,740

Total operating expenses

13,214

8,205

30,198

23,901

Operating loss

(9,258

)

(6,619

)

(15,681

)

(16,974

)

Change in fair value of warrants

556

4,648

Interest income, net

53

262

373

1,101

Other (expense)/income, net

(274

)

(932

)

(920

)

45

Loss before income tax expense (benefit)

(9,479

)

(6,733

)

(16,228

)

(11,180

)

Income tax expense (benefit)

(1,546

)

112

(1,166

)

29

Net loss

$

(7,933

)

$

(6,845

)

$

(15,062

)

$

(11,209

)

Net loss per common share

Basic

$

(0.31

)

$

(0.32

)

$

(0.65

)

$

(0.54

)

Diluted

$

(0.31

)

$

(0.35

)

$

(0.65

)

$

(0.75

)

Weighted average number of common shares outstanding

Basic

25,470

21,185

23,011

20,786

Diluted

25,470

21,203

23,011

20,894

UNAUDITED CONSOLIDATED BALANCE SHEET
(In thousands, except per share data)

December 31, 2020

March 31, 2020

ASSETS

Current assets:

Cash and cash equivalents

$

67,909

$

24,699

Marketable securities

10,239

30,149

Accounts receivable, net

12,083

16,987

Inventory, net

14,176

18,975

Prepaid expenses and other current assets

4,634

2,959

Restricted cash

629

508

Total current assets

109,670

94,277

Marketable securities

5,046

Property, plant and equipment, net

9,547

8,565

Intangibles, net

9,964

3,550

Right-of-use assets

3,806

3,359

Goodwill

34,659

1,719

Restricted cash

5,604

5,657

Deferred tax assets

1,386

1,551

Other assets

411

385

Total assets

$

175,047

$

124,109

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable and accrued expenses

$

17,015

$

22,091

Lease liability, current portion

581

439

Derivative liabilities

6,730

Deferred revenue, current portion

15,683

18,430

Total current liabilities

40,009

40,960

Deferred revenue, long term portion

8,695

7,712

Lease liability, long term portion

3,329

3,000

Deferred tax liabilities

70

180

Other liabilities

26

38

Total liabilities

52,129

51,890

Stockholders’ equity:

Common stock

280

229

Additional paid-in capital

1,120,333

1,053,507

Treasury stock

(3,593

)

(2,666

)

Accumulated other comprehensive loss

(405

)

(216

)

Accumulated deficit

(993,697

)

(978,635

)

Total stockholders’ equity

122,918

72,219

Total liabilities and stockholders’ equity

$

175,047

$

124,109

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

Nine Months Ended December 31,

2020

2019

Cash flows from operating activities:

Net loss

$

(15,062

)

$

(11,209

)

Adjustments to reconcile net loss to net cash used in operations:

Depreciation and amortization

3,811

3,312

Stock-based compensation expense

2,597

1,236

Provision for excess and obsolete inventory

1,610

491

Deferred income taxes

(1,828

)

(1,069

)

Change in fair value of contingent consideration

2,740

Change in fair value of warrants

(4,648

)

Non-cash interest income

(48

)

Other non-cash items

291

(22

)

Unrealized foreign exchange loss/(gain) on cash and cash equivalents

366

(209

)

Changes in operating asset and liability accounts:

Accounts receivable

6,376

(8,661

)

Inventory

7,419

(6,968

)

Prepaid expenses and other assets

6

(332

)

Accounts payable and accrued expenses

(7,894

)

2,648

Deferred revenue

(5,255

)

7,652

Net cash used in operating activities

(4,871

)

(17,779

)

Cash flows from investing activities:

Purchase of property, plant and equipment

(1,574

)

(2,926

)

Proceeds from the sale of property, plant and equipment

1

3,001

Purchase of marketable securities

(35,000

)

Sale of marketable securities

25,006

Cash paid for acquisition

(26,000

)

Change in other assets

(6

)

37

Net cash used in investing activities

(2,573

)

(34,888

)

Cash flows from financing activities:

Employee taxes paid related to net settlement of equity awards

(927

)

(565

)

Proceeds from exercise of warrants

6,139

Proceeds from public equity offering, net

51,477

Proceeds from exercise of employee stock options and ESPP

99

100

Net cash provided by financing activities

50,649

5,674

Effect of exchange rate changes on cash

73

30

Net increase/(decrease) in cash, cash equivalents and restricted cash

43,278

(46,963

)

Cash, cash equivalents and restricted cash at beginning of period

30,864

78,198

Cash, cash equivalents and restricted cash at end of period

$

74,142

$

31,235


RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET LOSS

(In thousands, except per share data)

Three Months Ended December 31,

Nine Months Ended December 31,

2020

2019

2020

2019

Net loss

$

(7,933

)

$

(6,845

)

$

(15,062

)

$

(11,209

)

Stock-based compensation

839

590

2,597

1,236

Amortization of acquisition-related intangibles

645

85

886

255

Acquisition costs

313

313

Change in fair value of contingent consideration and warrants

2,740

(556

)

2,740

(4,648

)

Non-GAAP net loss

$

(3,395

)

$

(6,726

)

$

(8,526

)

$

(14,366

)

Non-GAAP net loss per share – basic

$

(0.13

)

$

(0.32

)

$

(0.37

)

$

(0.69

)

Weighted average shares outstanding – basic

25,470

21,185

23,011

20,786

RECONCILIATION OF GAAP OPERATING CASH FLOW TO NON-GAAP OPERATING CASH FLOW
(In thousands)

Nine months ended

December 31, 2020

December 31, 2019

Operating cash flow

$

(4,871

)

$

(17,779

)

Sinovel settlement (net of legal fees and expenses)

1,000

Tax effect of adjustments

2,724

Non-GAAP operating cash flow

$

(4,871

)

$

(14,055

)

Reconciliation of Forecast GAAP Net Loss to Non-GAAP Net Loss
(In millions, except per share data)

Three months
ending

March 31, 2021

Net loss

$

8.0

Stock-based compensation

0.9

Amortization of acquisition-related intangibles

0.6

Non-GAAP net loss

$

6.5

Non-GAAP net loss per share

$

(0.25

)

Shares outstanding

25.7

Note: Non-GAAP net loss is defined by the Company as net income (loss) before: stock-based compensation; amortization of acquisition-related intangibles; acquisition costs; changes in fair value of contingent consideration and warrants; other non-cash or unusual charges, and the tax effect of adjustments calculated at the relevant rate for our non-GAAP metric. The Company believes non-GAAP net loss assists management and investors in comparing the Company’s performance across reporting periods on a consistent basis by excluding these non-cash, non-recurring or other charges that it does not believe are indicative of its core operating performance. The Company is not able to provide the change in fair value of contingent consideration on a forward-looking basis without unreasonable efforts because the calculation for that change is primarily driven by the closing price and volatility of the Company’s stock at the end of each fiscal quarter, which cannot be reasonably estimated at this time. The Company no longer has any warrants outstanding,therefore the Company’s non-GAAP net loss guidance does not include the impact from this adjustment. Actual GAAP and non-GAAP net loss for the fiscal quarter ending March 31, 2021, including the above adjustments, may differ materially from those forecasted in the table above, including as a result of the inclusion of the change in fair value of contingent consideration.

Non-GAAP operating cash flow is defined by the Company as operating cash flow before: Sinovel settlement (net of legal fees and expenses); and other unusual cash flows or items. The Company believes non-GAAP operating cash flow assists management and investors in comparing the Company’s operating cash flow across reporting periods on a consistent basis by excluding these non-recurring cash items that it does not believe are indicative of its core operating cash flow.

Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flow that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. The non-GAAP measures included in this release, however, should be considered in addition to, and not as a substitute for or superior to, operating income, cash flows, or other measures of financial performance prepared in accordance with GAAP. A reconciliation of GAAP to non-GAAP net loss is set forth in the table above.

AMSC Contacts

Investor Relations Contact:
LHA Investor Relations
Carolyn Capaccio
212-838-3777
[email protected]

Public Relations Contact:
RooneyPartners
Jeffrey Freedman
646-432-0191
[email protected]

AMSC Communications Manager:
Nicol Golez
978-399-8344
[email protected]

COMTEX_380145143/2471/2021-02-03T16:05:18

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