ThermoEnergy Reports First Quarter Financial Results and Provides Business Update

WORCESTER, Mass., May 11, 2011 /PRNewswire/ -- ThermoEnergy Corporation (OTCBB: TMEN), a diversified technologies company engaged in the municipal and industrial wastewater treatment and power generation technologies, today announced financial and operational results for the first quarter ended March 31, 2011.

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Mr. Cary Bullock, President and Chief Executive Officer of ThermoEnergy said, "Our first quarter results reflect continued improvement in the company's business segments. We successfully increased our confirmed orders, expanded our global sales pipeline and developed new technologies to better serve the municipal and industrial wastewater treatment and power generation industries. In addition, we restructured our debt, resolved IRS issues, and resolved an employment lawsuit, all of which are some of the last legacy issues we needed to resolve. These steps taken during the quarter now position the company for significant growth later this year and in 2012."

2011 First Quarter Operational and Financial Highlights:

• Strengthened the balance sheet by restructuring $8.1 million of senior debt.
• Submitted final engineering specs for our ARP milestones of Phase 1 of our $27.1 million contract with the City of New York. Management expects New York City contract to contribute increased revenue in 2011 as the manufacturing phase begins. Phase 2 of the project is valued at $13.4 million.
• Signed representative agreement in Europe to sell our ARP wastewater treatment solutions.
• Booked $1 million in new orders during the first quarter.
• Announced Turbo CAST®, a high flow wastewater treatment technology with significantly lower cost of operation that opens up additional industrial markets.

Mr. Bullock added, "We have submitted final design drawings to the city of New York for our ARP technology and expect to receive approval shortly to begin production during the third quarter. This contract will assist us in attracting additional wastewater treatment projects throughout the world and we are working towards converting projects from our pipeline into revenue producing contracts.  We remain focused on developing key strategic relationships and expanding the market presence for our energy technology to further enhance our revenues."

Revenues for the first quarter of 2011 were $0.9 million as compared to $1.1 million in the first quarter of 2010 as we transitioned from legacy business to our new business model. Revenues increased from our fourth quarter of 2010. Operating expenses increased in the first quarter and were $2.0 million compared to $1.7 million in 2010 due primarily to one-time costs associated with the settlement of an employment lawsuit.

Net loss attributable to common stockholders for the first quarter was $2.7 million and $2.0 million for 2010. The net loss included a non-cash deemed dividend to Series B Convertible Preferred Stockholders of $0.1 million in 2011, as a result of our financing transactions in the quarter. Excluding non-cash charges related to financing transactions (including deemed dividends, non cash gains and losses, as well as stock option and warrant expenses), EBITDA loss was $1.6 million in 2011 and $1.2 million in 2010.

We had cash on hand on March 31, 2011 of $1.8 million.

For additional details, please see our 2011 Form 10-Q filed with the SEC today.

About ThermoEnergy

Founded in 1988, ThermoEnergy is a diversified technologies company engaged in the worldwide development, sales and commercialization of patented and/or proprietary municipal and industrial wastewater treatment and power generation technologies. Additional information on the Company and its technologies can be found on its website at www.thermoenergy.com.

THIS PRESS RELEASE INCLUDES STATEMENTS THAT MAY CONSTITUTE "FORWARD LOOKING" STATEMENTS, USUALLY CONTAINING THE WORDS "ESTIMATE", "PROJECT", "EXPECT" OR SIMILAR EXPRESSIONS. FORWARD LOOKING STATEMENTS INHERENTLY INVOLVE RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM CURRENT EXPECTATIONS. BY MAKING THESE FORWARD LOOKING STATEMENTS, THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE THESE STATEMENTS FOR REVISIONS OR CHANGES.

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SOURCE ThermoEnergy Corporation