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Superconductor Technologies Reports Second Quarter 2018 Results

1231 Days ago

AUSTIN, Texas, Aug. 14, 2018 (GLOBE NEWSWIRE) -- Superconductor Technologies Inc. (STI) (Nasdaq: SCON) reported financial results for the three and six months ended June 30, 2018.

Jeff Quiram, STI’s president and CEO, stated, “In the second quarter of 2018, we generated $793,000 in government contract revenues from our Department of Energy project, bringing the total from the project start in June 2017 through the end of the second quarter to $1.5 million. Many in the electrical device industry recognize that 2G HTS wire, such as our Conductus wire, is the key enabling technology for next generation electric machines (NGEMs).  As previously announced, we successfully achieved the key wire performance milestones for the first year of our DOE NGEM project. Our primary focus for year two of the program is to demonstrate our capability to produce ‘best-in-class’ Conductus wire in quantity.”

In conjunction with project partners TECO Westinghouse Motor Company (TECO), Massachusetts Institute of Technology (M.I.T), and the University of North Texas (UNT), STI successfully achieved key first-year program milestones.

  1. STI produced 2G HTS wire that delivered 1.5X the critical current electrical performance and a 2X increase in in-field magnetic performance over the initial starting performance of the project as outlined in 2017. All of these results were verified and confirmed through third-party testing.
  2. In parallel, STI’s partners TECO and M.I.T modeled components of a 5000-horsepower motor utilizing STI’s enhanced Conductus® wire.

“As we implement the wire performance enhancements that align with our focused commercial wire development efforts, we remain on track to begin shipments of enhanced Conductus wire in the third quarter to multiple commercial customers for evaluation purposes,” Quiram concluded.

Second Quarter Financial Summary
STI’s second quarter 2018 net revenues were $793,000, compared to $8,000 in the second quarter of 2017 and $246,000 in the first quarter of 2018. Net loss for the second quarter 2018 was $1.5 million, or a loss of $1.24 per basic and diluted share, compared to a net loss of $2.5 million, or a loss of $2.37 per basic and diluted share, in the second quarter of 2017, and a net loss of $2.2 million, or a loss of $1.98 per basic and diluted share in the first quarter of 2018.

For the six-month period ending July 1, 2018, total net revenues were $1.0 million, compared to $9,000 for the first half of 2017. The net loss for the first half of 2018 was $3.7 million, or $3.17 per share, compared to $5.2 million, or $5.00 per share in the first half of 2017. 

Please note: share and per share data for both periods is adjusted for the 1-for-10 reverse stock split effective on July 24, 2018.

As of June 30, 2018, STI had $1.0 million in cash and cash equivalents.

On July 31, 2018, STI generated gross proceeds of approximately $9 million from a public offering.

Investor Conference Call
STI will host a conference call and simultaneous webcast today, August 14th, at 11:00 a.m. Eastern Time / 8:00 a.m. Pacific Time to discuss its results. To listen to the call live, please dial 1-866-548-4713 at least 10 minutes before the start of the conference. International participants may dial 1-323-794-2093. The conference ID is 8273413.  The call will be webcast and can be accessed from the “Investor Relations” section of the company’s website. A telephone replay will be available until midnight ET on August 18th by dialing 1-844-512-2921 or 1-412-317-6671, and entering pass code 8273413. A replay will also be available at the web address above.

About Superconductor Technologies Inc. (STI)
Superconductor Technologies Inc. is a global leader in superconducting innovation. Its Conductus® superconducting wire platform offers high performance, cost-effective and scalable superconducting wire. With 100 times the current carrying capacity of conventional copper and aluminum, superconducting wire offers zero resistance with extreme high current density. This provides a significant benefit for electric power transmission and also enables much smaller or more powerful magnets for motors, generators, energy storage and medical equipment. Since 1987, STI has led innovation in HTS materials, developing more than 100 patents as well as proprietary trade secrets and manufacturing expertise. For more than 20 years STI utilized its unique HTS manufacturing process for solutions to maximize capacity utilization and coverage for Tier 1 telecommunications operators. Headquartered in Austin, TX, Superconductor Technologies Inc.'s common stock is listed on the NASDAQ Capital Market under the ticker symbol “SCON.” For more information about STI, please visit http://www.suptech.com.

Safe Harbor Statement 
Statements in this press release regarding our business that are not historical facts are "forward-looking statements" that involve risks and uncertainties. Forward-looking statements are not guarantees of future performance and are inherently subject to uncertainties and other factors, which could cause actual results to differ materially from the forward-looking statements. These factors and uncertainties include, but are not limited to: our limited cash and a history of losses; our need to materially grow our revenues from commercial operations and/or to raise additional capital (which financing may not be available on acceptable terms or at all) in the very near future, before cash reserves are depleted, to implement our current business plan and maintain our viability; the performance and use of our equipment to produce wire in accordance with our timetable; overcoming technical challenges in attaining milestones to develop and manufacture commercial lengths of our HTS wire; the possibility of delays in customer evaluation and acceptance of our HTS wire; the limited number of potential customers and customer pressures on the selling prices of our products; the limited number of suppliers for some of our components and our HTS wire; there being no significant backlog from quarter to quarter; our market being characterized by rapidly advancing technology; the impact of competitive products, technologies and pricing; manufacturing capacity constraints and difficulties; the impact of any financing activity on the level of our stock price; the dilutive impact of any issuances of securities to raise capital; the steps required to maintain the listing of our common stock with a U.S. national securities exchange and the impact on the liquidity and trading price of our common stock if we fail to maintain such listing; the cost and uncertainty from compliance with environmental regulations; and local, regional, and national and international economic conditions and events and the impact they may have on us and our customers.

Forward-looking statements can be affected by many other factors, including, those described in the "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of STI's Annual Report on Form 10-K for the year ended December 31, 2017 and in STI's other public filings. These documents are available online at STI's website,  www.suptech.com , or through the SEC's website,  www.sec.gov . Forward-looking statements are based on information presently available to senior management, and STI has not assumed any duty to update any forward-looking statements.

Investor Relations Contact
Moriah Shilton or Kirsten Chapman
LHA      +1-415-433-3777       invest@suptech.com


  Three Months Ended   Six Months Ended
  June 30, 2018   July 1, 2017     June 30, 2018   July 1, 2017  
Commercial product revenues   -       8,000       -       9,000    
Government contract revenues   793,000       -       1,039,000       -    
  Total revenues      793,000          8,000          1,039,000          9,000    
Costs and expenses:                
  Cost of commercial product revenues   368,000       769,000       1,007,000       1,631,000    
  Cost of government contract revenues   551,000       -       734,000       -    
  Research and development   413,000       678,000       990,000       1,328,000    
  Selling, general and administrative   1,006,000       1,124,000       2,047,000       2,244,000    
  Total costs and expenses   2,338,000       2,571,000       4,778,000       5,203,000    
Loss from operations   (1,545,000)       (2,563,000)       (3,739,000)       (5,194,000)    
Other Income and Expense:                
  Adjustments to fair value of warrant derivatives   16,000       11,000        49,000       8,000    
  Adjustment to warrant exercise price   -       -         (24,000)       -    
  Other income   7,000       11,000       14,000       16,000    
 Net loss $   (1,522,000)     $   (2,541,000)     $   (3,700,000)     $   (5,170,000)    
Basic and diluted net loss per common share $  (1.24)     $  (2.37)     $  (3.17)     $  (5.00)    
Basic and diluted weighted average number of common shares outstanding   1,228,270       1,069,935       1,165,546       1,033,349    


  June 30,   December 31,
    2018       2017  
  (Unaudited)   (See Note)
Current Assets:      
  Cash and cash equivalents $   1,043,000      $   3,056,000  
  Accounts receivable, net   557,000       151,000  
  Inventories, net   152,000       102,000  
  Prepaid expenses and other current assets   210,000       83,000  
  Total Current Assets   1,962,000       3,392,000  
  Property and equipment, net of accumulated depreciation of      
  $11,729,000 and $11,200,000, respectively   1,268,000       1,793,000  
  Patents, licenses and purchased technology, net of accumulated amortization      
  of  $1,005,000 and $948,000, respectively   722,000       742,000  
  Other assets   69,000       69,000  
  Total Assets $    4,021,000      $    5,996,000  
Current Liabilities:      
  Accounts payable $   309,000      $  349,000  
  Accrued expenses   513,000       481,000  
  Total Current Liabilities   822,000       830,000  
  Other long-term liabilities   57,000       54,000  
  Total Liabilities   879,000       884,000  
Stockholders’ Equity:      
  Preferred stock, $.001 par value, 2,000,000 shares authorized,      
328,925 and 328,925 shares issued and outstanding, respectively   -       -  
  Common stock, $.001 par value, 250,000,000 shares authorized,       
1,232,379 and 1,074,659 shares issued and outstanding, respectively   1,000       1,000  
  Capital in excess of par value   318,454,000       316,724,000  
  Accumulated deficit   (315,313,000 )     (311,613,000 )
  Total Stockholders' Equity   3,142,000       5,112,000  
  Total Liabilities and Stockholders' Equity $    4,021,000      $    5,996,000  

Note – December 31, 2017 balances were derived from audited financial statements.


  Six Months Ended
  June 30, 2018   July 1, 2017  
 Net loss $   (3,700,000 )   $   (5,170,000 )  
 Adjustments to reconcile net loss to net cash used in        
  operating activities:        
 Depreciation and amortization   551,000       1,028,000    
 Stock-based compensation expense   30,000       201,000    
 Adjustments to fair value of warrant derivatives   (49,000 )     (8,000 )  
 Adjustment to warrant exercise price   24,000       -    
  Changes in assets and liabilities:        
  Accounts receivable   (406,000 )     9,000    
  Inventories   (50,000 )     6,000    
  Prepaid expenses and other current assets   (126,000 )     (103,000 )  
  Patents, licenses and purchased technology   (1,000 )     71,000    
  Other assets   -       27,000    
  Accounts payable, accrued expenses and other current liabilities   19,000       (212,000 )  
  Net cash used in operating activities   (3,708,000 )     (4,151,000 )  
  Purchases of property and equipment   (5,000 )     (39,000 )  
  Net cash used in investing activities   (5,000 )     (39,000 )  
  Net proceeds from the sale of common stock   1,700,000       -    
  Net proceeds from the exercise of outstanding warrants    -       200,000    
  Net cash provided by financing activities   1,700,000       200,000    
Net decrease in cash and cash equivalents   (2,013,000 )     (3,990,000 )  
Cash and cash equivalents at beginning of period   3,056,000       10,452,000    
Cash and cash equivalents at end of period $   1,043,000      $    6,462,000    


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