Evercel, Inc., Reports 2001 First Quarter Results

Apr 25, 2001, 01:00 ET from Evercel, Inc.

    DANBURY, Conn., April 25 /PRNewswire/ -- Evercel, Inc. (Nasdaq:   EVRC), a
 developer and manufacturer of advanced rechargeable batteries, reported first
 quarter revenue of $600,000, up from $5,000 in the first quarter of 2000. Net
 loss available to common shareholders was $4.4 million ($.48 per basic and
 diluted loss per share) compared to a loss of $2.1 million ($.37 per basic and
 diluted loss per share) in last year's first quarter.
     The increased revenue reflects initial sales of the company's nickel-zinc
 battery products in both China and the United States. Increased losses reflect
 the company's efforts to commercialize its products.  Operating costs and
 expenses in the first quarter of 2001 increased $3.1 million over the
 comparable quarter in 2000 as a result of increased personnel costs and other
 manufacturing expenses, including a new manufacturing facility, related to the
 commercialization of Evercel's nickel-zinc batteries. Interest income
 increased to $197,000 in the first quarter of 2001 from $63,000 in the
 comparable quarter in 2000 due to interest on short term investments from net
 proceeds of $25.4 million from a public offering of 3,000,000 shares on
 February 9, 2001.
     "While we are pleased to report our highest quarterly product revenue, it
 is less than we had expected," said Robert L. Kanode, president and CEO.  "As
 we reported on April 10, we have experienced longer-than-expected delays with
 getting our Virginia manufacturing facility up to full capacity. We are well
 on our way to working through those issues so that we can reach our full
 manufacturing and marketing potential. In spite of these issues, I am pleased
 that more of our products are getting into the hands of customers, and I am
 confident that we have great technology and great products that will delight
 even more customers going forward."
     A conference call to discuss the first quarter results of the company has
 been scheduled for Thursday, April 26, 2001, at 9:00 AM Eastern. Interested
 parties can listen in by calling 719-457-2629 prior to the scheduled start
 time. A replay version of the conference call will be available after the call
 at 719-457-0820. The confirmation number to access the replay version is
 770786.  A live webcast of the call can be accessed from Evercel's web site at
 http://www.evercel.com.
 
     About Evercel
     Evercel, Inc., (http://www.evercel.com) is a leading manufacturer of
 high-performance, environmentally friendly and cost-effective nickel-zinc
 rechargeable batteries for a wide range of applications, including scooters,
 trolling motors for boats, electric bicycles, electric vehicles, lawn mowers,
 electric wheelchairs and golf carts. The Company, based in Danbury,
 Connecticut, operates manufacturing facilities in Newport News, Virginia, and
 in Xiamen, China. In China, the Company operates as Xiamen Three Circles-ERC
 Battery Corp., Ltd., a joint venture.
 
     This press release contains forward-looking statements, including
 statements regarding the Company's plans and expectations regarding the
 development and commercialization of its' battery technology. All
 forward-looking statements are subject to risk and uncertainties that could
 cause actual results to differ materially from those projected. Factors that
 could cause such a difference include, without limitation, general risks
 associated with product development, manufacturing, rapid technological
 change, and competition, as well as other risks set forth in the Company's
 filings with the Securities and Exchange Commission. The forward-looking
 statements contained herein speak only as of the date of this press release.
 The Company expressly disclaims any obligation or undertaking to release
 publicly any updates or revisions to any such statement to reflect any change
 in the Company's expectations or any change in events, conditions or
 circumstances on which any such statement is based.
 
                         EVERCEL, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                (Dollars in thousands, except per share amounts)
 
                                                      Three Months Ended
                                                          (Unaudited)
                                                    March 31,      March 31,
                                                      2001(b)           2000
 
     Revenues                                            $600             $5
     Cost and expenses:
         Cost of revenues(a)                            2,651              5
         Administrative and selling expenses            1,836          1,363
         Research and development                         681            679
           Total operating costs and expenses           5,168          2,047
 
     Loss from operations                              (4,568)        (2,042)
 
     Interest income, net                                 197             63
 
     Loss attributable to minority interest                34             --
 
     Loss before income taxes                          (4,337)        (1,979)
 
     Income tax expense (benefit)                          --             --
 
     Net loss                                          (4,337)        (1,979)
 
     Preferred stock dividends                            (97)          (132)
 
     Net loss - common shareholders                   $(4,434)       $(2,111)
 
     Basic and diluted loss per share                  $(0.48)        $(0.37)
 
     Basic and diluted shares outstanding               9,176          5,733
 
         (a) Because the Company is producing and selling products in 2001,
             manufacturing related costspreviously deemed to be research and
             development costs are now in costs of revenues.
 
         (b) The financial statements include our accounts and the accounts of
             our two subsidiaries -- the Xiamen Three Circles-ERC Battery Corp.
             joint venture and the Xiamen-ERC High Technology joint venture --
             consolidated subsequent to December 1, 2000. Prior to that date,
             the Xiamen Three Circles-ERC Battery Corp subsidiary was accounted
             for under the equity method.
 
 
                           CONSOLIDATED BALANCE SHEET
                             (Dollars in thousands)
 
                                                    March 31,   December 31,
     ASSETS                                           2001(b)           2000
 
     Current assets:
       Cash and cash equivalents                      $29,573        $12,195
       Accounts receivable                                624            129
       Inventories                                      3,405          2,246
       Other current assets                             1,380            470
         Total current assets                          34,982         15,040
 
       Property, plant and equipment, net               9,085          8,337
       Other assets, net                                3,129          3,750
 
     TOTAL ASSETS                                     $47,196        $27,127
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
 
     Current liabilities:
       Current portion of long term debt                 $290           $248
       Accounts payable                                   985          1,519
       Accrued salaries and benefits                      797            835
       Accrued liabilities                              1,434          1,564
         Total current liabilities                      3,506          4,166
 
     Long term debt                                     1,123          1,118
     Other non-current liabilities                         64            141
     Minority interest                                  5,554          5,588
 
     Shareholders' equity:
       Preferred Stock ($0.01 par value);
         1,000,000 shares authorized:
         190,500 and 196,500 issued and
         outstanding at March 31, 2001 and
         December 31, 2000, respectively
         (with cumulative dividends at 8%).                 2              2
       Common Stock ($0.01 par value);
         30,000,000 shares authorized:
         10,453,770 and 7,431,952, issued
         and outstanding at March 31, 2001
         and December 31, 2000, respectively.             105             74
       Additional paid-in-capital                      58,785         33,644
       Note receivable from shareholder                  (300)          (300)
       Accumulated deficit                            (21,643)       (17,306)
         Total shareholders' equity                    36,949         16,114
 
     TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY       $47,196        $27,127
 
         (b) The financial statements include our accounts and the accounts of
             our two subsidiaries -- the Xiamen Three Circles-ERC Battery Corp.
             joint venture and the Xiamen-ERC High Technology joint venture --
             consolidated subsequent to December 1, 2000. Prior to that date,
             the Xiamen Three Circles-ERC Battery Corp subsidiary was accounted
             for under the equity method.
 
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SOURCE Evercel, Inc.
    DANBURY, Conn., April 25 /PRNewswire/ -- Evercel, Inc. (Nasdaq:   EVRC), a
 developer and manufacturer of advanced rechargeable batteries, reported first
 quarter revenue of $600,000, up from $5,000 in the first quarter of 2000. Net
 loss available to common shareholders was $4.4 million ($.48 per basic and
 diluted loss per share) compared to a loss of $2.1 million ($.37 per basic and
 diluted loss per share) in last year's first quarter.
     The increased revenue reflects initial sales of the company's nickel-zinc
 battery products in both China and the United States. Increased losses reflect
 the company's efforts to commercialize its products.  Operating costs and
 expenses in the first quarter of 2001 increased $3.1 million over the
 comparable quarter in 2000 as a result of increased personnel costs and other
 manufacturing expenses, including a new manufacturing facility, related to the
 commercialization of Evercel's nickel-zinc batteries. Interest income
 increased to $197,000 in the first quarter of 2001 from $63,000 in the
 comparable quarter in 2000 due to interest on short term investments from net
 proceeds of $25.4 million from a public offering of 3,000,000 shares on
 February 9, 2001.
     "While we are pleased to report our highest quarterly product revenue, it
 is less than we had expected," said Robert L. Kanode, president and CEO.  "As
 we reported on April 10, we have experienced longer-than-expected delays with
 getting our Virginia manufacturing facility up to full capacity. We are well
 on our way to working through those issues so that we can reach our full
 manufacturing and marketing potential. In spite of these issues, I am pleased
 that more of our products are getting into the hands of customers, and I am
 confident that we have great technology and great products that will delight
 even more customers going forward."
     A conference call to discuss the first quarter results of the company has
 been scheduled for Thursday, April 26, 2001, at 9:00 AM Eastern. Interested
 parties can listen in by calling 719-457-2629 prior to the scheduled start
 time. A replay version of the conference call will be available after the call
 at 719-457-0820. The confirmation number to access the replay version is
 770786.  A live webcast of the call can be accessed from Evercel's web site at
 http://www.evercel.com.
 
     About Evercel
     Evercel, Inc., (http://www.evercel.com) is a leading manufacturer of
 high-performance, environmentally friendly and cost-effective nickel-zinc
 rechargeable batteries for a wide range of applications, including scooters,
 trolling motors for boats, electric bicycles, electric vehicles, lawn mowers,
 electric wheelchairs and golf carts. The Company, based in Danbury,
 Connecticut, operates manufacturing facilities in Newport News, Virginia, and
 in Xiamen, China. In China, the Company operates as Xiamen Three Circles-ERC
 Battery Corp., Ltd., a joint venture.
 
     This press release contains forward-looking statements, including
 statements regarding the Company's plans and expectations regarding the
 development and commercialization of its' battery technology. All
 forward-looking statements are subject to risk and uncertainties that could
 cause actual results to differ materially from those projected. Factors that
 could cause such a difference include, without limitation, general risks
 associated with product development, manufacturing, rapid technological
 change, and competition, as well as other risks set forth in the Company's
 filings with the Securities and Exchange Commission. The forward-looking
 statements contained herein speak only as of the date of this press release.
 The Company expressly disclaims any obligation or undertaking to release
 publicly any updates or revisions to any such statement to reflect any change
 in the Company's expectations or any change in events, conditions or
 circumstances on which any such statement is based.
 
                         EVERCEL, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                (Dollars in thousands, except per share amounts)
 
                                                      Three Months Ended
                                                          (Unaudited)
                                                    March 31,      March 31,
                                                      2001(b)           2000
 
     Revenues                                            $600             $5
     Cost and expenses:
         Cost of revenues(a)                            2,651              5
         Administrative and selling expenses            1,836          1,363
         Research and development                         681            679
           Total operating costs and expenses           5,168          2,047
 
     Loss from operations                              (4,568)        (2,042)
 
     Interest income, net                                 197             63
 
     Loss attributable to minority interest                34             --
 
     Loss before income taxes                          (4,337)        (1,979)
 
     Income tax expense (benefit)                          --             --
 
     Net loss                                          (4,337)        (1,979)
 
     Preferred stock dividends                            (97)          (132)
 
     Net loss - common shareholders                   $(4,434)       $(2,111)
 
     Basic and diluted loss per share                  $(0.48)        $(0.37)
 
     Basic and diluted shares outstanding               9,176          5,733
 
         (a) Because the Company is producing and selling products in 2001,
             manufacturing related costspreviously deemed to be research and
             development costs are now in costs of revenues.
 
         (b) The financial statements include our accounts and the accounts of
             our two subsidiaries -- the Xiamen Three Circles-ERC Battery Corp.
             joint venture and the Xiamen-ERC High Technology joint venture --
             consolidated subsequent to December 1, 2000. Prior to that date,
             the Xiamen Three Circles-ERC Battery Corp subsidiary was accounted
             for under the equity method.
 
 
                           CONSOLIDATED BALANCE SHEET
                             (Dollars in thousands)
 
                                                    March 31,   December 31,
     ASSETS                                           2001(b)           2000
 
     Current assets:
       Cash and cash equivalents                      $29,573        $12,195
       Accounts receivable                                624            129
       Inventories                                      3,405          2,246
       Other current assets                             1,380            470
         Total current assets                          34,982         15,040
 
       Property, plant and equipment, net               9,085          8,337
       Other assets, net                                3,129          3,750
 
     TOTAL ASSETS                                     $47,196        $27,127
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
 
     Current liabilities:
       Current portion of long term debt                 $290           $248
       Accounts payable                                   985          1,519
       Accrued salaries and benefits                      797            835
       Accrued liabilities                              1,434          1,564
         Total current liabilities                      3,506          4,166
 
     Long term debt                                     1,123          1,118
     Other non-current liabilities                         64            141
     Minority interest                                  5,554          5,588
 
     Shareholders' equity:
       Preferred Stock ($0.01 par value);
         1,000,000 shares authorized:
         190,500 and 196,500 issued and
         outstanding at March 31, 2001 and
         December 31, 2000, respectively
         (with cumulative dividends at 8%).                 2              2
       Common Stock ($0.01 par value);
         30,000,000 shares authorized:
         10,453,770 and 7,431,952, issued
         and outstanding at March 31, 2001
         and December 31, 2000, respectively.             105             74
       Additional paid-in-capital                      58,785         33,644
       Note receivable from shareholder                  (300)          (300)
       Accumulated deficit                            (21,643)       (17,306)
         Total shareholders' equity                    36,949         16,114
 
     TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY       $47,196        $27,127
 
         (b) The financial statements include our accounts and the accounts of
             our two subsidiaries -- the Xiamen Three Circles-ERC Battery Corp.
             joint venture and the Xiamen-ERC High Technology joint venture --
             consolidated subsequent to December 1, 2000. Prior to that date,
             the Xiamen Three Circles-ERC Battery Corp subsidiary was accounted
             for under the equity method.
 
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                http://tbutton.prnewswire.com/prn/11690X37114379
 
 SOURCE  Evercel, Inc.