SOURCE: Altair Nanotechnologies Inc.

Altair Nanotechnologies Inc.

August 02, 2011 08:00 ET

Altair Nanotechnologies Reports Second Quarter 2011 Financial Results

RENO, NV--(Marketwire - Aug 2, 2011) - Altair Nanotechnologies Inc. (Altairnano) (NASDAQ: ALTI), a provider of advanced lithium-ion battery technologies and systems, today reported financial results for the second quarter ended June 30, 2011.

Financial Highlights for the second quarter of 2011 compared to 2010

  • Revenues decreased to $0.5 million from $1.5 million.
  • Gross margin of $(0.2) million compared to $0.4 million.
  • Operating expenses of $3.8 million compared to $5.5 million.
  • Net loss of $3.0 million compared to $4.9 million.
  • Year-to-date cash burn excluding financing activities of $9.1 million compared to $9.7 million.

Recent Highlights

  • On July 22, 2011 Altair closed its pending Canon investment transaction for $57.5 million.
  • On June 13, 2011, Proterra announced that it had resolved its financing difficulties with the receipt of a new investment of $30 million. Altairnano has resumed discussions with them on the delivery of the remaining battery modules from their 2010 order and the placement of a new order for continuing business as they ramp back up their production.
  • On June 2, 2011 we announced the award of a 3-year lease for our new ALTI-ESS Advantage 1.8 MW/ 300 kWh energy storage system by Energy Storage Holdings, LLC, a unit of a major U.S.-based energy company.
  • On February 9, 2011, we signed a contract for delivery of a turn-key 10 Megawatt ALTI-ESS advanced battery system for frequency control with Inversiones Energéticas, S.A. de C.V. (INE), one of El Salvador's largest electric generation utilities. Subsequently, on April 15, 2011, INE informed us that due to unresolved regulatory issues they were cancelling that contract. However, on June 7, 2011, we agreed to a request from INE to extend the contract for a 90-day period to allow additional time to resolve the regulatory issues.

Of these recent highlights, the most significant by far was the closing of the Canon investment. This transaction has been anticipated since early first quarter and with its close now provides Altairnano with a significantly stronger balance sheet. Under the terms of this investment Canon purchased newly issued common shares of Altairnano resulting in its owning 53.3% of the company's outstanding shares, 49.8% on a fully diluted basis, immediately following the close.

For the 2011 second quarter, Altairnano reported revenues to $0.5 million, down from $1.5 million in the second quarter of 2010. The overwhelming driver for this reduction was the termination of our military business at the end of 2010 in order to close the Canon transaction. In addition, YTE, the operating entity of Canon, has not yet resumed acceptance of LTO shipments from Altairnano in accordance with the Conditional Supply and Technology Licensing Agreement we signed with them in September 2010.

The net loss was $3.0 million, or $0.10 per share, compared to a net loss of $4.9 million, or $0.19 per share, for the second quarter of 2010. The basic and diluted weighted average shares outstanding for the quarter were 30.4 million, compared to 26.3 million for the same period in 2010.

"The second quarter was a very challenging period because of our severe cash constraints resulting from the delays in the Canon investment close; however, we did make progress in some key areas," said Dr. Terry Copeland, Altairnano's president and chief executive officer. "We announced a three-year lease of our new 1.8 MW/ 300 kWh ALTI-ESS Advantage product, have made significant progress in getting the 10 MW INE frequency regulation project back on track and continue to make inroads in the various OEM industrial markets we have targeted."

For the quarter, gross profit declined by $0.6 million and operating expenses were lower by 31 percent, falling from $5.5 million in the second quarter of 2010 to $3.8 million for the same period this year. The primary driver for the reduced gross profit was the lower contribution from early stage products and the elimination of our military sales in 2011, while the primary drivers to the lower operating expenses were the deferral of all development and non-critical customer work due to the severe cash constraints caused by the Canon close delay.

Altairnano's cash and cash equivalents decreased by $2.1 million, from $4.7 million at December 31, 2010 to $2.6 million at June 30, 2011. This is primarily due to net cash used in operations of approximately $8.8 million, partially offset by the sale of additional common stock for a net amount of $5.7 million and a mortgage on our Reno property of $1.5 million. The bulk of the cash used in operations went to cover normal compensation and non-labor expenses. Significant additional items adding to our cash balance from operations were a decrease of $0.8 million in product inventories and a decrease of $0.4 million in accounts receivable, largely offset by a decrease of $1.0 million in accounts payable and a decrease of $0.9 million in deferred revenue. Investing activities consisted of the purchase of fixed assets of approximately $0.3 million. Financing activities of $7.0 million is a result of the money raised from the Company's March registered direct financing of $5.7 million and the mortgage of our Reno property for $1.5 million offset by leasing payments of $0.2 million.

Second Quarter 2011 Conference Call
Altairnano will hold a conference call to discuss its second quarter 2011 results on Tuesday, August 2, 2011 at 11:00 a.m. Eastern Daylight Time (EDT). Shareholders and members of the investment community are invited to participate in the conference call. The dial-in number for both U.S. and international callers is +1 678-224-7719. Please dial in to the conference five minutes before the call is scheduled to begin. Ask the operator for the Altair Nanotechnologies call.

Post call, a phone-based audio replay will be available from 2:00 p.m. EDT, Tuesday, August 2, 2011 until Midnight EDT, August 8, 2011. It can be accessed by dialing +1 404-537-3406 and entering the conference number 87172127. Additionally, the conference call and replay will be available online, and can be accessed by visiting Altairnano's web site,

About Altair Nanotechnologies Inc.
Headquartered in Reno, Nevada with engineering and manufacturing operations in Anderson, Indiana, Altairnano is a leading provider of energy storage systems for clean, efficient power and energy management. Altairnano's Lithium-Titanate based battery systems are among the highest performing and most scalable, with applications that include complete energy storage systems for use in providing frequency regulation and renewables integration for the electric grid, and battery modules and cells for transportation and industrial applications. For more information please visit Altairnano at

Forward-Looking Statements
This release may contain forward-looking statements as well as historical information. Forward-looking statements, which are included in accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, may involve risks, uncertainties and other factors that may cause Altairnano's actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this release. These risks and uncertainties include, without limitation, the risks that development of any the early-stage products of the Company will not be completed for technical, business or other reasons; that any products under development or in the early commercial stages will not perform as expected in future testing or commercial applications; that customers or prospective customers will not use or purchase products as represented to us or otherwise expected for various reasons, including a buyer's purchasing of a competing product or a buyer's absence of capital to purchase products; that one or more of the joint development partners or customers may proceed slowly with, or abandon, development or commercialization efforts for any of various reasons, including concerns with the feasibility of the product, regulatory restrictions or the financial viability of continuing with our products or their product; that sales of commercialized Altairnano products may not reach expected levels for one or more reasons, including the failure of end products to perform as expected or the introduction of a superior product; that costs associated with the proposed products may exceed revenues; and that, due to unexpected expenses not accompanied by offsetting revenue, the Company's use of cash in its operations may exceed budgeted levels. In general, Altairnano is, and expects to be in the immediate future, dependent upon funds generated from sales of products, securities, testing agreements, and licensing agreements to fund its testing, development and ongoing operations. These risks and uncertainties include, without limitation, that significant cultural and business differences with Canon may make it difficult to realize the anticipated benefits from that investment. In addition, other risks are identified in the Company's most recent Annual Report on Form 10-K filed with the SEC. Such forward-looking statements speak only as of the date of this release. The Company expressly disclaims any obligation to update or revise any forward-looking statements found herein to reflect any changes in Company expectations or results or any change in events.

Tables Follow

(Expressed in thousands of United States Dollars, except shares)
June 30, December 31,
2011 2010
Current assets
Cash and cash equivalents $ 2,577 $ 4,695
Accounts receivable, net 909 1,318
Product inventories 6,205 6,825
Prepaid expenses and other current assets 2,288 2,269
Total current assets 11,979 15,107
Property, plant and equipment, net 8,116 8,727
Patents, net 388 426
Total Assets $ 20,483 $ 24,260
Current Liabilities
Trade accounts payable $ 1,889 $ 2,873
Accrued salaries and benefits 1,285 743
Accrued warranty 239 211
Accrued liabilities 467 387
Deferred revenues 1,651 2,516
Warrant liabilities 906 -
Short-term debt 1,519 216
Total current liabilities 7,956 6,946
Long Term Liabilities
Long-term debt, less current portion 7 16
Total long term liabilities 7 16
Total Liabilities 7,963 6,962
Stockholders' equity
Common stock, no par value, unlimited shares authorized; 30,615,680 and 27,015,680 shares issued and outstanding at June 30, 2011 and December 31, 2010
193,436 189,491
Additional paid in capital 12,510 12,297
Accumulated deficit (193,426 ) (184,490 )
Total Stockholders' Equity 12,520 17,298
Total Liabilities and Stockholders' Equity $ 20,483 $ 24,260
(Expressed in thousands of United States Dollars, except shares and per share amounts)
Three Months Ended June 30,
2011 2010
Product sales $ 174 $ 57
License fees 60 -
Commercial collaborations 7 8 26
Contracts and grants 164 1,417
Total revenues 476 1,500
Cost of goods sold
Product 314 7
Commercial collaborations 197 12
Contracts and grants 168 984
Warranty and inventory reserves 12 75
Total cost of goods sold 691 1,078
Gross (loss) profit (215 ) 422
Operating expenses
Research and development 1,284 1,715
Sales and marketing 913 1,146
General and administrative 1,204 2,142
Depreciation and amortization 379 460
Loss on disposal of assets - 39
Total operating expenses 3,780 5,502
Loss from operations (3,995 ) (5,080 )
Other (expense) income
Interest expense (52 ) (3 )
Interest income - 27
Change in market value of warrants 1,022 -
Gain/(loss) on foreign exchange - 2
Total other income, net 970 26
Loss from continuing operations (3,025 ) (5,054 )
Gain from discontinued operations - 124
Net loss (3,025 ) (4,930 )
Less: Net loss attributable to non-controlling interest - 5
Net loss attributable to Altair Nanotechnologies Inc. $ (3,025 ) $ (4,925 )
Net loss attributable to Altair Nanotechnologies Inc. shareholders:
Loss from continuing operations $ (3,025 ) $ (5,054 )
Gain from discontinued operations - 129
Net loss $ (3,025 ) $ (4,925 )
Earnings per share attributable to Altair Nanotechnologies Inc. shareholders:
Basic and diluted:
Loss from continuing operations $ (0.10 ) $ (0.19 )
Gain from discontinued operations $ - $ -
Loss per common share - basic and diluted $ (0.10 ) $ (0.19 )
Weighted average shares - basic and diluted 30,424,730 26,313,871

Contact Information

  • For Additional Information:

    Casey Stegman
    Stonegate Securities, Inc.
    (214) 987-4121
    (972) 850-2001