American Superconductor (US:AMSC)2022-11-01 20:08Financial Performance - Total revenues for the three months ended September 30, 2022, were $27,680,000, a decrease of 0.8% compared to $27,908,000 for the same period in 2021[17]. - Gross margin for the three months ended September 30, 2022, was $1,970,000, representing a decline of 39.4% from $3,261,000 in the prior year[17]. - Operating loss for the three months ended September 30, 2022, was $(8,092,000), compared to $(4,302,000) for the same period in 2021, indicating a 88.5% increase in losses[17]. - Net loss for the three months ended September 30, 2022, was $(9,881,000), compared to $(4,434,000) in the same period of 2021, reflecting a 22.7% increase in net losses[17]. - The company reported a comprehensive loss of $(7,855,000) for the three months ended September 30, 2022, compared to $(4,410,000) for the same period in 2021[19]. - The net loss for the six months ended September 30, 2022, was $18.59 million, compared to a net loss of $9.84 million for the same period in 2021, indicating a significant increase in losses[26]. - Total revenues for the Company in the six months ended September 30, 2022, were $50.4 million, down 5.5% from $53.3 million in the same period in 2021[132]. - Net loss increased to $9.9 million and $18.6 million for the three and six months ended September 30, 2022, compared to $4.4 million and $9.8 million for the same periods in 2021, primarily due to lower revenues and gross margins[172]. - Non-GAAP net loss was $6.5 million and $13.3 million for the three and six months ended September 30, 2022, compared to $5.1 million and $7.8 million for the same periods in 2021, reflecting a higher operating loss[176]. Assets and Liabilities - Total current assets as of September 30, 2022, were $94,979,000, slightly up from $94,336,000 as of March 31, 2022[13]. - Total current liabilities increased to $66,880,000 as of September 30, 2022, from $53,964,000 as of March 31, 2022, marking a 23.9% rise[14]. - Cash and cash equivalents decreased to $27,811,000 as of September 30, 2022, down from $40,584,000 as of March 31, 2022, a decline of 31.5%[13]. - Total stockholders' equity as of September 30, 2022, was $95.38 million, down from $116.10 million as of September 30, 2021, reflecting a decrease of approximately 17.8%[23]. - Cash, cash equivalents, and restricted cash at the end of the period were $37.35 million, a decrease from $56.99 million at the end of the previous year, representing a decline of about 34.8%[26]. - As of September 30, 2022, the Company had an accumulated deficit of $1,039 million and cash and cash equivalents of $27.8 million, with cash used in operations amounting to $11.6 million for the six months ended September 30, 2022[31][34]. - The Company has filed a shelf registration statement allowing it to offer and sell up to $250 million of common stock, debt securities, or other units to fund future capital needs[32]. Expenses - Research and development expenses for the three months ended September 30, 2022, were $2,314,000, down from $2,669,000 in the same period of 2021, a decrease of 13.3%[17]. - Selling, general and administrative expenses rose to $7,350,000 for the three months ended September 30, 2022, compared to $6,697,000 in the prior year, an increase of 9.7%[17]. - Stock-based compensation expense for the six months ended September 30, 2022, was $2.05 million, down from $2.39 million in the prior year, indicating a reduction of approximately 15.4%[26]. - The Company incurred a provision for excess and obsolete inventory of $1.02 million for the six months ended September 30, 2022, compared to $1.20 million in the same period of 2021[26]. - The Company recorded amortization expenses of $0.7 million and $1.4 million for the three and six months ended September 30, 2022, respectively, due to the acquisition of Neeltran[164]. - The Company recorded depreciation expenses of $0.7 million for the three months ended September 30, 2022, consistent with the same period in 2021[104]. Revenue Segments - In the three months ended September 30, 2022, total revenue was $25.7 million, with $24.1 million from the Grid segment and $1.3 million from Wind[67]. - For the six months ended September 30, 2022, total revenue reached $45.5 million, with $42.2 million from the Grid segment and $3.3 million from Wind[67]. - In the Americas region, revenue for the three months ended September 30, 2022, was $18.0 million, and for the six months, it was $34.9 million[67]. - The Grid business unit accounted for 93% of total revenues for the three months ended September 30, 2022, with revenues increasing 4% to $25.7 million, while the Wind business unit revenues decreased 40% to $2.0 million[159][160]. - Total revenues for the Grid segment in September 2022 were $25.7 million, a 4.4% increase from $24.6 million in September 2021; Wind segment revenues decreased by 39.7% to $1.98 million from $3.29 million[132]. Acquisitions - The total purchase price for the Neeltran Acquisition was $16.4 million, which included cash payments of $4.4 million and debt payments of $7.6 million[38]. - The NEPSI Acquisition had a total purchase price of approximately $42.4 million, consisting of $26.0 million in cash and $12.4 million in common stock issued[50]. - Goodwill recognized from the Neeltran Acquisition amounted to $8.8 million, reflecting the value associated with the acquired workforce and expected synergies[43]. - Goodwill recognized from the NEPSI Acquisition amounted to $32.9 million, assigned to the Grid business segment[56]. - The total purchase consideration for the NEPSI Acquisition was $42.4 million[54]. - The Company evaluated the NEPSI Acquisition earnout payment and determined the contingent consideration qualified for liability classification, resulting in a net gain of $0.3 million for the three months ended September 30, 2022[113]. Operational Challenges - The Company experienced substantial inflationary pressure in its supply chain, which increased costs and decreased gross margin[33]. - The Company has a history of operating losses and negative operating cash flows, which may continue in the future[143]. - The Company relies on third-party suppliers for components, making it vulnerable to supply shortages and price fluctuations, which could harm its business[143]. - The decrease in Wind business unit revenues was driven by fewer royalty collections and shipments of electrical control systems[160]. Compliance and Controls - As of September 30, 2022, the company's disclosure controls and procedures were evaluated as effective at the reasonable assurance level by the Chief Executive Officer and Chief Financial Officer[193]. - There were no changes to the internal control over financial reporting during the quarter ended September 30, 2022, that materially affected the internal control[194]. - There were no material changes to the risk factors described in the Annual Report for the fiscal year ended March 31, 2022[196]. - The Company did not identify any uncertain tax positions or gross unrecognized tax benefits as of September 30, 2022[112].