AccelRate Power Systems Inc.
TSX VENTURE : APS
FRANKFURT : KCG

AccelRate Power Systems Inc.

May 12, 2006 09:40 ET

AccelRate Reports First Quarter 2006 Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 12, 2006) - AccelRate Power Systems (TSX VENTURE:APS)(FWB:KCG), the leader in "high-speed" battery charging technology, today announced its financial results for the quarter ended March 31, 2006.

During the three months ended March 31, 2006, AccelRate recognized total revenues of $114,476 from licenses, royalties and sales of battery chargers incorporating AccelRate "high-speed" battery charging technology, compared to nil for the same quarter in 2005. Operating expenses of $292,790 were higher than the previous quarter of $186,442 due to the commencement of commercial production, expanded operations, and general increases in operating costs. Non-cash costs of $211,814 were higher than the prior quarter of $87,080 primarily due to an increase of $137,250 in stock-based compensation due to the vesting of more options granted in 2005 than prior years. The net loss for the three months ended March 31, 2006 was $462,201 compared to $273,522 for the comparative three-month period.

During the quarter, AccelRate expanded the territories for sale of industrial chargers incorporating its charging technology by signing an agreement with EnerSys, the world's largest manufacturer of industrial batteries. Under this agreement, industrial chargers using AccelRate technology are now being marketed for sale in Europe, the largest users of electric forklifts worldwide. Hawker Powersource, an EnerSys division, previously licensed AccelRate's technology for the North American motive power market in April 2005.

Also in the quarter, AccelRate commenced legal action in response to letters received from an individual demanding an unspecified amount of money on the theory that the Company's patented technology contains elements which are the subject of technology developed by them and patented in Yugoslavia. The Company has independently investigated the Defendants' claims and has concluded that they have no merit and that their motivation was for the express purpose of extracting a quick monetary settlement from the Company. The Company has no intention of acceding to any such threats and has commenced its lawsuit seeking damages and an injunction prohibiting the Defendants from interfering with its economic interests and commercial relations. The outcome of this lawsuit is currently not determinable.

"We are satisfied with our revenue performance given that industrial product sales began only two quarters earlier and that production capability has yet to fully ramp up, which has delayed AccelRate's signing of new distributors," said Reimar Koch, President and CEO of AccelRate Power Systems. "As such, we do not expect this quarter to be representative of the production and sales that we are anticipating later in the year. We foresee the majority of our 2006 sales will be weighted to the last half of the year once production cycles are established, once current end-use customers have fully evaluated the AccelRate chargers operating in their facilities, when additional distributors are added, and once the European product launch has been initiated. While costs and expenses are higher than in the previous year due to the commencement of commercialization, the company is closely managing all of its expenditures."

AccelRate's complete financial statements may be reviewed at www.sedar.com.

About AccelRate:

AccelRate's proprietary charging technology functions effectively with batteries of all conventional chemistries and sizes in industrial, portable, power tool, military and transportation applications. AccelRate's technology provides customers with up to 80% decreased charging time, increased battery lifetime due to improved heat management, and decreased energy use.

Chargers incorporating AccelRate's "High-Speed" battery charging technology are currently available in North America through Hawker Powersource at www.hawkerpowersource.com or through AccelRate Power Systems at www.accelrate.com. Interested European customers may contact EnerSys Europe at www.enersys-hawker.com.

AccelRate Power Systems is headquartered in Vancouver, BC. AccelRate's shares trade on the TSX Venture Exchange (symbol APS), and on the Frankfurt Exchange (symbol KCG).

ACCELRATE POWER SYSTEMS INC.

Reimar Koch, President and CEO

This new release may contain forward-looking statements. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially because of factors discussed in the management discussion and analysis section of our interim and most recent annual financial statement or other reports and filings with the TSX Venture Exchange and applicable Canadian securities regulations. We do not undertake any duty to update any forward-looking statements.


The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • AccelRate Power Systems Inc.
    Debby Harris
    (604) 688-8656
    or
    AccelRate Power Systems Inc.
    Reimar Koch
    President and CEO
    (604) 688-8656
    (604) 688-8654 (FAX)
    info@accelrate.com
    www.accelrate.com