American DG Energy Reports Third Quarter 2015 Financial Performance

North American operations improves Non-GAAP EBITDA cash outflows to $51,018

Nov 11, 2015, 09:00 ET from American DG Energy Inc.

WALTHAM, Mass., Nov. 11, 2015 /PRNewswire/ -- American DG Energy Inc. (NYSE MKT: ADGE), On-Site Utility™, offering clean electricity, heat, hot water and cooling solutions to hospitality, healthcare, housing and fitness facilities, reported total revenues of $1,956,544 in the third quarter of 2015, compared to $1,886,693 for the same period in 2014. Loss per share (EPS) was $(0.02) in the third quarter of 2015, compared with a loss per share of $(0.02) for the same period in 2014. Reflecting the Company's ongoing efforts to optimize its On-Site Utility production, gross margin without depreciation improved in the third quarter of 2015 to 37.5% from 35.3% in the same period a year ago.

Major Highlights:

Financials

  • Consolidated revenues increased by 3.7% for the third quarter of 2015 as compared to the third quarter of 2014.
  • As a result of our efforts to improve operations and efficiencies, general and administrative expenses have decreased to $558,821 for the third quarter of 2015 versus $780,744 for the same period in 2014, a 28.4% improvement. Overall operating expenses improved 8.3% with a reduction of $102,481.
  • Gross margin without depreciation improved by 2.3%, hitting 38.6% for the third quarter of 2015 versus 36.3% for the same period in 2014.
  • Consolidated EBITDA cash outflows improved by $21,277, reaching $397,186 in the third quarter of 2015, versus outflows of $418,463 in the third quarter of 2014.
  • As a result of our focused efforts to improve fleet operations, parent company American DG Energy's business in North America had Non-GAAP EBITDA cash outflows for the three months ended September 30, 2015 of $51,018 versus outflows of $168,152 in the third quarter of 2014, an improvement of over $117,134. See reconciliation of Non-GAAP EBITDA below.

Operations

  • Management appointed Bonnie Brown as Chief Financial Officer and Robert Panora as Acting Director of Operations.
  • Certain of the Company's directors and members of management have adopted SEC Rule 10b5-1 plans to purchase ADGE stock in the open market; the plans are active and ongoing.
  • As of September 30, 2015 we operated 120 energy systems and our current backlog consists of 19 energy systems.
  • Third quarter revenue was attributable to the following core markets:




Hospitality

24


%

Fitness

22


%

Housing

15


%

Health Care

9


%

Education

24


%

Other

6


%

TOTAL

100


%





  • The total number of systems now under contract is 139, totaling 9,988kW and 4,855 tons of cooling
  • In total, as of September 30, 2015, we operated 121 systems totaling 8,323kW of installed capacity with a total contract value of $261.1 million.

American DG Energy will hold its earnings conference call today, November 11, 2015 at 11:00 a.m. Eastern Time. To listen, call (866) 364-3819 within the U.S., (855) 669-9657 from Canada, or (412) 902-4209 from other international locations.  Participants should reference American DG Energy to access the call.  Please begin dialing at least 10 minutes before the scheduled starting time.  The earnings press release will be available on the Company web site at www.americandg.com in the "Investors" section under "News Releases."

The earnings conference call will be recorded and available for playback one hour after the end of the call through Thursday November 19, 2015.  To listen to the playback, call (877) 344-7529 within the U.S. (855) 669-9658 from Canada, or +1 (412)317-0088 from other international locations and reference Replay Access Code 10075343. Following the call, the webcast will be archived for 30 days.

About American DG Energy
American DG Energy supplies low-cost energy to its customers through distributed power generating systems. We are committed to providing institutional, commercial and small industrial facilities with clean, reliable power, cooling, heat and hot water at lower costs than charged by local utilities - without any capital or start-up costs to the energy user - through our On-Site Utility energy solutions. American DG Energy is headquartered in Waltham, Massachusetts. Learn more about how American DG Energy reduces energy costs at www.americandg.com or follow us on Facebook and Twitter.

FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties. Important factors could cause actual results to differ materially from those indicated by such forward-looking statements, as disclosed on the Company's website and in Securities and Exchange Commission filings. This press release does not constitute an offer to buy or sell securities by the Company, its subsidiaries or any associated party and is meant purely for informational purposes. The statements in this press release are made as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.

       

AMERICAN DG ENERGY INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)



September 30,
 2015


December 31,
 2014

ASSETS




Current assets:




Cash and cash equivalents

$

6,836,273



$

11,825,915


Accounts receivable, net

1,028,910



1,140,811


Unbilled revenue

13,652



12,533


Due from related party

53,159



39,682


Inventory finished goods

1,088,097



1,153,927


Prepaid and other current assets

571,441



852,069


Total current assets

9,591,532



15,024,937


Property, plant and equipment, net

26,187,009



24,885,155


Accounts receivable, long-term



3,600


Other assets, long-term

63,609



92,148


TOTAL ASSETS

$

35,842,150



$

40,005,840






LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




Accounts payable

$

757,666



$

605,530


Accrued expenses and other current liabilities

508,900



485,570


Due to related party

986,072



630,805


Note payable related party

2,000,000




Total current liabilities

4,252,638



1,721,905


Long-term liabilities:




Convertible debentures

1,600,309



1,645,444


Convertible debentures due related parties

16,729,795



15,864,215


Note payable related party



3,000,000


Warrant liability

2



6,780


Other long-term liabilities



2,227


Total liabilities

22,582,744



22,240,571


Commitments and contingencies (Note 8)




Stockholders' Equity:




American DG Energy Inc. stockholders' equity:




Common stock, $0.001 par value; 100,000,000 shares authorized; 50,684,095 and
52,140,001 issued and outstanding at September 30, 2015 and December 31, 2014,
respectively.

50,684



52,140


Additional paid-in capital

49,636,284



49,854,998


Accumulated deficit

(38,639,539)



(35,232,411)


Total American DG Energy Inc. stockholders' equity

11,047,429



14,674,727


Noncontrolling interest

2,211,977



3,090,542


Total stockholders' equity

13,259,406



17,765,269


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

35,842,150



$

40,005,840


      

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



Three Months Ended


September 30,
 2015


September 30,
 2014

Revenues




Energy revenues

$

1,750,682



$

1,697,723


Turnkey & other revenues

205,862



188,970



1,956,544



1,886,693


Cost of sales




Fuel, maintenance and installation

1,202,289



1,201,003


Depreciation expense

521,276



464,296



1,723,565



1,665,299


Gross profit

232,979



221,394


Operating expenses




General and administrative

558,821



780,744


Selling

250,792



291,984


Engineering

327,712



167,078



1,137,325



1,239,806


Loss from operations

(904,346)



(1,018,412)






Other income (expense), net




Interest and other income

6,641



35,592


Interest expense

(320,337)



(350,892)


 Change in fair value of warrant liability

299



110,897



(313,397)



(204,403)






Loss before benefit (provision) for income taxes

(1,217,743)



(1,222,815)


Benefit (provision) for income taxes

(8,797)



(22,814)


Consolidated net loss

(1,226,540)



(1,245,629)


(Loss) income attributable to noncontrolling interest

207,907



75,977


Net loss attributable to American DG Energy Inc.

$

(1,018,633)



$

(1,169,652)






Net loss per share - basic and diluted

$

(0.02)



$

(0.02)


Weighted average shares outstanding - basic and diluted

50,687,355



51,690,714






Non-GAAP financial disclosure




Loss from operations

$

(904,346)



$

(1,018,412)


Depreciation expense

534,236



469,636


Stock based compensation

(27,076)



130,313


Adjusted EBITDA

(397,186)



(418,463)


Grants from rebates and incentives (reduction in basis of property)




Total cash outflows*

$

(397,186)



$

(418,463)




*    Non-GAAP EBITDA cash outflows for the third quarter of 2015 and 2014 were $51,018 and $168,152, respectively, for American DG Energy in North America and EBITDA outflows of EuroSite were $346,168 and $250,311 respectively.

     

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



Nine Months Ended


September 30,
 2015


September 30,
 2014

Revenues




Energy revenues

$

6,012,139



$

5,846,521


Turnkey & other revenues

539,272



639,194



6,551,411



6,485,715


Cost of sales




Fuel, maintenance and installation

4,297,426



4,394,238


Depreciation expense

1,549,591



1,358,173



5,847,017



5,752,411


Gross profit

704,394



733,304


Operating expenses




General and administrative

2,065,250



2,330,702


Selling

899,913



800,458


Engineering

713,159



629,526



3,678,322



3,760,686


Loss from operations

(2,973,928)



(3,027,382)






Other income (expense), net




Interest and other income

193,074



57,940


Interest expense

(950,443)



(1,084,215)


Loss on extinguishment of debt



(533,177)


Change in fair value of warrant liability

6,778



101,885



(750,591)



(1,457,567)






Loss before provision for income taxes

(3,724,519)



(4,484,949)


Provision for income taxes

(13,965)



(32,694)


Consolidated net loss

(3,738,484)



(4,517,643)


Loss attributable to noncontrolling interest

331,356



406,483


Net loss attributable to American DG Energy Inc.

$

(3,407,128)



$

(4,111,160)






Net loss per share - basic and diluted

$

(0.07)



$

(0.08)


Weighted average shares outstanding - basic and diluted

50,691,472



50,484,304






Non-GAAP financial disclosure

$

(2,973,928)



$

(3,027,382)


Loss from operations

1,586,410



1,394,201


Depreciation expense

253,813



$

338,790


Stock based compensation

$

(1,133,705)



$

(1,294,391)


Adjusted EBITDA

$

668,859



$

0


Grants from rebates and incentives (reduction in basis of property)

$

(464,846)



$

(1,294,391)


Total cash outflows




       

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


(Unaudited)

Nine Months Ended


September 30,
 2015


September 30,
 2014





CASH FLOWS FROM OPERATING ACTIVITIES:




Net loss attributable to American DG Energy, Inc.

$

(3,407,128)



$

(4,111,160)


Loss attributable to noncontrolling interest

(331,356)



(406,483)


Adjustments to reconcile net loss to net cash (used in) provided by operating activities:




Depreciation and amortization

1,586,410



1,394,201


    Gain attributable to distribution of nonmonetary assets to noncontrolling interest

(157,870)




Loss on extinguishment of debt



533,177


Amortization of deferred financing costs

40,096



2,567


Amortization of convertible debt premium

(72,216)



9,997


Increase (decrease) in fair value of warrant liability

(6,778)



(101,885)


Non-cash interest expense

867,329



624,368


Stock-based compensation

253,813



338,790


Changes in operating assets and liabilities:




(Increase) decrease in:




Accounts receivable and unbilled revenue

114,382



(231,417)


Due from related party

(13,378)



283,356


Inventory

65,830



544,159


Prepaid and other current assets

269,071



(326,378)


Increase (decrease) in:




Accounts payable

152,136



215,103


Accrued expenses and other current liabilities

48,662



348,066


Due to related party

355,267



(34,843)


Other long-term liabilities

(2,227)



(10,206)


Net cash used in operating activities

(237,957)



(902,501)






CASH FLOWS FROM INVESTING ACTIVITIES:




Purchases of property and equipment

(3,312,452)



(3,899,360)


Partial purchase of noncontrolling interest

(100,000)




Net cash used in investing activities

(3,412,452)



(3,899,360)






CASH FLOWS FROM FINANCING ACTIVITIES:




Proceeds from issuance of convertible debentures



1,450,000


Proceeds from sale of common stock, net of costs



3,242,957


Purchases of common stock, net of costs

(152,377)




Payment on related party note payable

(1,000,000)



3,000,000


Distributions to noncontrolling interest

(186,856)



(168,546)


Net cash (used in) provided by financing activities

(1,339,233)



7,524,411






Net decrease in cash and cash equivalents

(4,989,642)



2,722,550


Cash and cash equivalents, beginning of the period

11,825,915



9,804,291


Cash and cash equivalents, end of the period

$

6,836,273



$

12,526,841






Supplemental disclosures of cash flows information:




Cash paid during the period for:




Interest

$

90,871



$

80,000


Income taxes

$

35,838



$

54,974


Non-cash investing and financing activities:




Distribution of nonmonetary assets

$

340,069




      

SOURCE American DG Energy Inc.



RELATED LINKS

http://www.americandg.com