American DG Energy Reports Fourth Quarter 2012 Financial Performance

Current backlog increases to 40 energy systems compared to 20 systems a year ago

News provided by

American DG Energy Inc.

Mar 12, 2013, 09:00 ET

WALTHAM, Mass., March 12, 2013 /PRNewswire/ -- American DG Energy Inc. (NYSE MKT: ADGE), a leading On-Site Utility, offering clean electricity, heat, hot water and cooling solutions to hospitality, healthcare, housing and athletic facilities, reported revenues of $1,549,580 in the fourth quarter of 2012, compared to $1,469,276 for the same period in 2011, an increase of 5.5%. Total revenues were $5,645,194 in 2012, compared to $6,022,868 in 2011.

GAAP diluted loss per share (EPS) was $(0.03) in the fourth quarter of 2012, compared with $(0.04) for the same period in 2011 and GAAP diluted loss per share (EPS) was $(0.14) in 2012, compared to $(0.08) in 2011.

Major Highlights:

Operations

  • We currently operate 92 energy systems.
  • Our current backlog consists of 40 energy systems compared to 20 at December 31, 2011.
  • We reached agreements with the following properties:
    • Luna Park Housing Corporation in Brooklyn, New York – to provide five 100 kW Combined Heat and Power (CHP) systems and five hot water heaters for their domestic hot water.
    • Cumberland County Jail, Portland, Maine – to provide two 75 kW CHP systems and produce space heat, hot water and electricity within the County Jail complex.
    • Doral Arrowwood Hotel Conference Center, Rye Brook, New York – to provide two 450-ton chillers for their central plant cooling systems.
    • The John Hopkins University in Baltimore, Maryland – to provide a 75 kW CHP system to Wolman Hall student housing.
    • DoubleTree by Hilton Hotel, Tarrytown, New York – to provide a 30-ton chiller.
    • Wentworth Club, Surrey, United Kingdom – to provide two 100 kW CHP systems at the Tennis & Health Club and at the main Clubhouse.
    • Best Western, Cedar Court Hotel, Harrogate, United Kingdom – to provide a 100 kW CHP system to produce electricity, heating and domestic hot water; Cedar Court Grand Hotel & Spa, York, United Kingdom – to provide a 100 kW CHP system to produce electricity, heating and domestic hot water. 
    • Roko Health Clubs, in Chiswick, Gillingham, Nottingham and Portsmouth, United Kingdom – to provide four 100 kW CHP systems to produce electricity, heating and domestic hot water. 
    • We entered into a partnership with DONG Energy Sales (formerly Shell Gas Direct) to improve energy efficiency and reduce carbon footprint for customers using CHP solutions.
  • We began operations at the following properties:
    • DoubleTree Hotel, Tarrytown, New York – started operating a 100 kW CHP system to supply electricity, space heat and domestic hot water.
    • Metro YMCA, Wayne, New Jersey – started operating 450-ton chillers to supply cooling.
    • Cumberland County Jail, Portland, Maine – started operating two 75 kW CHP systems and produce space heat, hot water and electricity within the County Jail complex.
    • Prospect Park Residencies, Brooklyn, New York – started operating a 100 kW CHP system with convenience back-up power.
    • Hilton Hotel, Liverpool, United Kingdom – started operating a 225 kW system to produce energy in the form of electricity, space heat and domestic hot water.
    • The Hampton by Hilton, Luton, United Kingdom – started operating a CHP system to supply clean energy.
    • London Syon Park, a Waldorf Astoria Hotel – started operating a 100 kW system for the hotel's guest rooms, public areas and back-of-house.
    • Roko Health Club, Portsmouth, UK – started operating a 100 kW system.

Financial

  • Total energy production in the 4th quarter of 2012 increased to 20.4 million kWh, or a 7.2% gain compared to the same period 2011.
  • Utility rates for natural gas decreased 11.5% in the 4th quarter of 2012 compared to the same period in  2011, which lowered our energy revenue for the period.
  • EBITDA cash outflows in the 4th quarter of 2012 for American DG Energy were $110,798 and for EuroSite Power were $366,296. Our consolidated EBITDA cash outflow in the 4th quarter of 2012 was $477,094 primarily due to expenses at EuroSite Power and the expansion of sales and marketing activity at American DG Energy.
  • Energy gross profit margin without depreciation was 36.6% in 2012 compared to 36.1% in 2011.
  • We have received a total of $583,800 in rebates and incentives in 2012.
  • The total revenue value of our current On-Site Utility energy agreements is approximately $270 million.
  • We finished 2012 with approximately $13.4 million in cash.

American DG Energy will hold its earnings conference call today, March 12, 2013 at 10:00 a.m. Eastern Time. To listen, call (800) 860-2442 within the U.S, (866) 605-3852 from Canada or (412) 858-4600 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 our 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 Friday, April 12, 2013. To listen to the playback, call (877) 344-7529 within the U.S. or (412) 317-0088 outside the U.S. and use Conference Number 10025430.

The earnings conference call will be webcast live. To register for and listen to the webcast, go to www.americandg.com/webcast. 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. More information can be found at www.americandg.com.

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.

CONSOLIDATED STATEMENT OF OPERATIONS
For the years ended December 31, 

2012

2011

Revenues


Energy revenues

$

5,388,395

$

5,705,418

Turnkey & other revenues

256,799

317,450

5,645,194

6,022,868

Cost of sales


Fuel, maintenance and installation

3,487,223

3,827,539

Depreciation expense

1,698,014

1,265,009

5,185,237

5,092,548

Gross profit

459,957

930,320

Operating expenses


General and administrative

2,770,535

2,384,774

Selling

1,919,075

1,496,764

Engineering

1,165,286

763,260

5,854,896

4,644,798

Loss from operations

(5,394,939)

(3,714,478)

Other income (expense), net


Interest and other income

62,322

40,234

Interest expense

(1,270,694)

(532,544)

Change in fair value of warrant liability

(139,893)

427,042

(1,348,265)

(65,268)

Loss before provision for state income taxes

(6,743,204)

(3,779,746)

Benefit (provision) for state income taxes

(24,550)

—

Consolidated net loss

(6,767,754)

(3,779,746)

(Income) loss attributable to the noncontrolling interest

241,967

(4,199)

Net loss attributable to American DG Energy Inc.

$

(6,525,787)

$

(3,783,945)




Net loss per share - basic and diluted

$

(0.14)

$

(0.08)

Weighted average shares outstanding - basic and diluted

47,108,980

45,705,793




Non-GAAP financial disclosure


Loss from operations

$

(5,394,939)

$

(3,714,478)

Depreciation expense

1,754,279

1,315,861

Stock based compensation

810,285

667,000

Adjusted EBITDA

(2,830,375)

(1,731,617)

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

583,800

510,069

Total cash outflows

$

(2,246,575)

$

(1,221,548)

CONSOLIDATED BALANCE SHEETS

December 31, 2012

December 31, 2011

ASSETS


Current assets:


Cash and cash equivalents

$

13,362,919

$

17,801,025

Accounts receivable, net

761,678

879,630

Unbilled revenue

19,492

18,825

Due from related party

18,372

21,140

Inventory

2,920,444

634,120

Prepaid and other current assets

308,164

322,276

Total current assets

17,391,069

19,677,016

Property, plant and equipment, net

17,253,648

14,690,117

Accounts receivable, long-term

46,800

82,664

Other assets, long-term

47,216

53,504

TOTAL ASSETS

$

34,738,733

$

34,503,301




LIABILITIES AND STOCKHOLDERS' EQUITY


Current liabilities:


Accounts payable

$

765,618

$

520,608

Accrued expenses and other current liabilities

532,420

589,032

Due to related party

41,812

313,847

Capital lease obligations

3,365

3,365

Total current liabilities

1,343,215

1,426,852

Long-term liabilities:


Convertible debentures

19,400,000

19,400,000

Warrant liability

389,454

249,561

Capital lease obligations, long-term

—

3,365

Other long-term liabilities

29,444

43,052

Total liabilities

21,162,113

21,122,830




Stockholders' equity:


American DG Energy Inc. stockholders' equity:


Common stock, $0.001 par value; 100,000,000 shares authorized; 48,490,733 and
       46,001,404 issued and outstanding at December 31, 2012 and 2011, respectively

48,491

46,001

Additional paid-in capital

37,001,439

30,399,370

Accumulated deficit

(24,456,845)

(17,931,058)

Total American DG Energy Inc. stockholders' equity

12,593,085

12,514,313

Noncontrolling interest

983,535

866,158

Total stockholders' equity

13,576,620

13,380,471

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

34,738,733

$

34,503,301

CONSOLIDATED STATEMENT OF CASH FLOWS
For the years ended December 31,

2012

2011

CASH FLOWS FROM OPERATING ACTIVITIES:


Net loss

$

(6,525,787)

$

(3,783,945)

Income (loss) attributable to noncontrolling interest

(241,967)

4,199

Adjustments to reconcile net loss to net cash used in operating activities:


Depreciation and amortization

1,754,279

1,315,861

Provision for losses on accounts receivable

123,880

110,229

Amortization of deferred financing costs

20,448

2,256

Increase (decrease) in fair value of warrant liability

139,893

(427,042)

Noncash interest expense

1,237,470


Stock-based compensation

810,285

667,000

Changes in operating assets and liabilities:


(Increase) decrease in:


Restricted cash

—

65,790

Accounts receivable and unbilled revenue

29,269

(295,033)

Due from related party

2,768

31,292

Inventory

(2,286,324)

(146,396)

Prepaid and other current assets

(48)

(224,283)

Increase (decrease) in:


Accounts payable

245,010

37,691

Accrued expenses and other current liabilities

(56,612)

218,258

Due to related party

(272,035)

153,127

Other long-term liabilities

(13,608)

43,052

Net cash used in operating activities

(5,033,079)

(2,227,944)

CASH FLOWS FROM INVESTING ACTIVITIES:


Purchases of property and equipment

(4,211,402)

(1,643,534)

Net cash used in investing activities

(4,211,402)

(1,643,534)

CASH FLOWS FROM FINANCING ACTIVITIES:


Proceeds from issuance of convertible debentures

—

17,000,000

Proceeds from issuance of warrants

7,500

—

Proceeds from sale of common stock, net of costs

3,535,038

—

Proceeds from sale of subsidiary common stock, net of costs

2,139,293

1,148,401

Proceeds from exercise of stock options

200,923

33,838

Purchases of common stock, net of costs

(750,000)

—

Convertible debenture transaction costs

—

(67,664)

Principal payments on capital lease obligations

(3,365)

(3,365)

Cancellation of restricted stock

(40)

(20)

Distributions to noncontrolling interest

(322,974)

(359,741)

Net cash provided by financing activities

4,806,375

17,751,449

Net (decrease) increase in cash and cash equivalents

(4,438,106)

13,879,971

Cash and cash equivalents, beginning of the period

17,801,025

3,921,054

Cash and cash equivalents, end of the period

$

13,362,919

$

17,801,025

 

SOURCE American DG Energy Inc.

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