Axion Power Reports Results for Third Quarter and Nine Months of 2014

NEW CASTLE, Penn., Nov. 14, 2014 /PRNewswire/ -- Axion Power International, Inc., (Nasdaq: AXPW, AXPWW), the developer of advanced lead-carbon PbC® batteries and energy storage systems, announced results for its third quarter and nine months ended September 30, 2014.

Revenues decreased significantly during the third quarter due to the discontinuance of contract manufacturing of flooded lead-acid batteries for a large international battery company.  Contract manufacturing had been the primary source of revenues for the last several years. 

Management and the Board have determined that the most efficient use of resources is to operate as a technology-based enterprise to promote and market our proprietary PbC® technology and to streamline manufacturing efforts to focus on our lead-carbon technology. In the fourth quarter of 2014, we are taking steps to evaluate and implement changes regarding our manufacturing strategy as it relates to our facilities in New Castle, Pa. The goal is to consolidate effort and drive some expense reduction. We will also continue developing third party sourcing for PbC battery suppliers and selling PbC batteries and energy storage systems. We believe that this streamlined effort with regard to our carbon negative electrode manufacturing will provide us with the best opportunity to commercialize our PbC technology and thereby provide the potential to improve our financial condition, cash flow and market presence.

Revenues for the quarter ended September 30, 2014, were $0.3 million with a net loss of $2.6 million or $0.55 loss per share, compared to revenues of $2.2 million in the third quarter of 2013 with a net loss of $4.7 million or $2.00 loss per share.  For the nine months ended September 30, 2014, revenues were $4.5 million with a net loss of $11.3 million or $2.55 loss per share, compared to revenues of $7.1 million for the nine months of 2013, with a net loss of $6.7 million or $3.00 loss per share.  The weighted average common shares outstanding were adjusted to reflect a 50-for-1 reverse stock split that became effective as of September 8, 2014, subsequent to shareholder approval announced July 2, 2014.

David DiGiacinto was appointed Chairman and CEO of Axion Power, replacing former Chairman and CEO Thomas Granville, who resigned from management and from the Board as of July 1, 2014 due to unanticipated adverse health concerns. 

Subsequent to the end of the third quarter, effective Nov 1, 2014, Charles Trego, formerly Axion Power Interim CFO, accepted the position of CFO of Axion Power.

Also subsequent to the end of the third quarter, on October 29, 2014, Axion Power consummated an underwritten public offering consisting of 1,875,000 shares of common stock, together with Series A warrants to purchase 1,875,000 common shares and Series B warrants to purchase 1,875,000 common shares, for net proceeds to the Company of $5.5 million.  In connection with the offering, the Company granted to the underwriter a 45-day option to acquire up to 281,250 additional common shares and equivalent amounts of Series A and Series B warrants.  That option will expire on December 13, 2014 or earlier, at the election of the underwriter.

CEO David DiGiacinto commented, "We will be keeping a tight rein on total expense control, on furthering essential R&D activities, and focusing on the market opportunities in energy storage for renewable energy, frequency regulation, and transportation concentrating on locomotives and heavy-duty commercial trucks.  We have a high priority on selling PbC technology and products in these markets, and believe that our PbC products are especially well suited for these market opportunities.  Our primary goal is to be the producer of activated total carbon electrodes, working with partner companies to produce and market the key element that contains the technology which has been developed over many years.  We have a unique technology that we believe is better suited to certain market opportunities than any competitive technology.  Our job is to commercialize the product, and make sure we have the right resources to accomplish the goal.

"We are focusing on PbC revenue and margins, customer engineering, strategic partnerships, and improving the execution of our business. We are very pleased to have been designated to provide energy storage and frequency regulation for the Coatesville Solar Initiative which, when completed, is projected to be a 9.1 megawatt solar farm, and the largest solar farm in Pennsylvania.  We are also working with a commercial solar photovoltaic company in New Jersey, which is in the process of completing its first installation using PbC technology in a system for energy storage and frequency regulation.  Because of the work that Axion has done for the last several years with the PJM grid, the Coatesville and other installations will be able to connect directly to the PJM grid, and potentially to provide high-value frequency regulation with a response time in nanoseconds, as we do on a daily basis in New Castle.  We have also made a much smaller 12kw installation near our factory, a size that would be right for residential or small commercial applications, or possibly for island locations where electricity from the grid is very costly."

As of September 30, 2014, cash and cash equivalents was $0.6 million, down from $1.2 million at December 31, 2013.  The current ratio was 1.4:1 and stockholders' equity was $5.7 million. Our balance sheet was strengthened by the addition of the net proceeds of the October 29 public offering; however, the financial resources of the Company, inclusive of the net proceeds of the October 29 public offering, will not provide sufficient funds for the Company's operations beyond September 30, 2015, as those operations currently exist. Subsequent funding sources will be required to fund the Company's ongoing operations, working capital and capital expenditures beyond September 30, 2015.

Conference Call:
The Company's management team will host a conference Friday, November 14, 2014 at 12:00 pm Eastern Time to discuss its third quarter ended September 30, 2014 results.

Participants should dial into the call ten minutes before the scheduled time using the following numbers: 1-877-300-8521 (USA) or +1-412-317-6026 (international) to access the call.

Audio Webcast:
There will also be a simultaneous live webcast through the Company's website, www.axionpower.com and selecting the investor tab. Participants should register on the website approximately ten minutes prior to the start of the webcast.

Replay:
An audio replay of the conference call will be available for seven days and can be accessed by dialing 1-877-870-5176 (USA) or +1-858-384-5517 (international) and using passcode 10055527.

For those unable to attend to the live webcast, it will be archived shortly following the event for 30 days in the Investors section of the Company's website.

About Axion Power International, Inc.
Axion has developed and patented a next generation energy storage device that won the prestigious Frost & Sullivan Technology Award for North America in the field of lead-acid batteries.

Axion Power International, Inc. believes it is an industry leader in the field of lead-carbon energy storage technologies. Axion believes its new PbC battery technology is the only class of advanced battery that can be assembled on existing lead-acid battery production lines throughout the world utilizing Axion's proprietary activated carbon electrodes. Axion's primary goal is to become the leading supplier of carbon electrode assemblies for the global lead-acid battery industry.

For more information, visit www.axionpower.com

Forward-looking Statements
Certain statements in this Press Release are "forward-looking statements" within the meaning of the Private Securities Litigation Act of 1995. These forward-looking statements are based on our current expectations and beliefs and are subject to a number of risk factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Such risks and uncertainties include the risk for the Company to complete its development work, as well as the risks inherent in commercializing a new product (including technology risks, market risks, financial risks and implementation risks, and other risks and uncertainties affecting the Company), as well as other risks that have been included in filings with the Securities and Exchange Commission, all of which are available at www.sec.gov. We disclaim any intention or obligation to revise any forward-looking statements, including, without limitation, financial estimates, whether as a result of new information, future events, or otherwise.

Contacts

Axion Power International, Inc.
Charles Trego, CFO
[email protected] 

Allen & Caron, Inc.
Rudy Barrio (Investors)
[email protected] 
(212) 691-8087

Len Hall (Media)
[email protected]  
(949) 474-4300

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SOURCE Axion Power International, Inc.

Related Links

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