|
August 6, 2009
WORCESTER, MA, Aug 06, 2009 -- World Energy Solutions, Inc. (NASDAQ: XWES; TSX: XWE), an operator of online exchanges for energy and green commodities, today announced its financial results for the second quarter ended June 30, 2009. All figures below are in U.S. dollars, and growth percentages compare the results of the three months ended June 30, 2009 with the three months ended June 30, 2008, unless stated otherwise.
Q2 2009 Highlights
- Revenue increased by 33% to $3.7 million
- Backlog at record levels
- Annualized: $9.5 million
- Total: $19.5 million
- Net loss decreased 67% to $0.8 million, or $(0.09) per share
- Listed on NASDAQ
- Key product line highlights
- Capitalized on FirstEnergy's newly competitive Ohio retail power market
- Completed key government renewals with Maryland and Massachusetts
- Wholesale continued strong contribution
- Year-to-date revenue at 96% of 2008 total
- Customer base grew from 30 to 46
- Solid performance from Green
- Executed the fourth RGGI compliance auction
- Made major advancements to the World Green Exchange for the carbon offset market
"Despite a challenging economic environment, we continue to post strong numbers," said Richard Domaleski, Chief Executive Officer, World Energy Solutions. "The quarter was marked by solid performance across all of our product lines, resulting in record backlog. The Wholesale product line's performance was particularly noteworthy as utilities are facing lower demand due to the recession. Additionally, our Retail group was able to react nimbly to the newly competitive northern Ohio electric territories and secure several deals at the end of Q2, adding to our record backlog.
"I am also pleased to note the passage of the American Clean Energy and Security Act by the U.S. House of Representatives, which outlines a cap-and trade framework that calls for auctioning a portion of the government allowances and creates significant added demand for carbon offsets. We see these as positive steps forward for the environment and our business."
Financial Review
Revenue for the quarter ended June 30, 2009 rose by 33% over the same period last year to $3.7 million, which reflects increases in all of the Company's product lines, including Wholesale, Green and strong auction and natural gas bookings in Retail.
The improvements made to the Company's cost structure in 2008 and resulting efficiencies continued during the second quarter of 2009. Cost of revenue decreased $0.3 million and gross profit margin increased to 73% compared to 54% in the same period the prior year. Total operating expenses decreased 10% to $3.5 million primarily reflecting general payroll and benefit decreases as well as decreases in compliance costs. Operating expenses as a percentage of revenue decreased more than 45% over the prior year as the Company was able to lower its operating cost structure while delivering the 33% increase in revenue.
Net loss for the second quarter of 2009 was $0.8 million, or $(0.09) per share, compared with a net loss of $2.4 million, or $(0.29) per share, in the second quarter of 2008. This decrease was primarily due to the 33% increase in revenue and an overall decline in cost of revenue and operating expenses.
Revenue for the six months ended June 30, 2009 rose 30% over the same period last year to $7.7 million due to increased auction activity in all of the Company's product lines.
Cost of revenue decreased $0.4 million and gross profit margin increased to 73% compared to 57% in the first six months of 2008. Total operating expenses for the six months ended June 30, 2009 decreased to $7.0 million from $7.9 million in the same period last year primarily due to decreases in payroll and benefit costs as well as lower compliance, travel and consulting. Net loss for the year-to-date period was $1.5 million, or $(0.17) per share, compared with $4.5 million, or $(0.55) per share, in the first six months of 2008.
At June 30, 2009, the Company had no bank debt and cash and cash equivalents of $0.8 million. Net cash used in operations for the six-months ended June 30, 2009 was $0.8 million resulting primarily from an increase in trade accounts receivable of $0.6 million and a $0.2 million decrease in current liabilities. Non-cash expense items, including depreciation, amortization and share-based compensation, were $1.3 million, substantially offsetting the $1.5 million net loss for the first six months of 2009. The Company believes it has the financial resources to execute its growth plans and reach cash flow positive in 2009.
* Backlog relates to contracts in force on a given date representing transactions between buyers and sellers on our platform related to commodity brokerage assuming sellers consume energy at their historical usage levels or deliver credits at expected levels. Total backlog represents the revenue that the Company would derive over the remaining life of those contracts. Annualized backlog represents the revenue that the Company would derive from those contracts within the 12 months following the date on which the backlog is calculated. Total and annualized backlog at June 30, 2009 included commodity backlog of $18.4 million and $8.4 million, respectively. In addition, total and annualized backlog include contracted management fees between World Energy and energy consumers for energy management and auction administration services of $1.1 million that are expected to be received over the following 12 month period. These management fees can be terminated within 30 days per the terms of the contracts.
Conference Call Webcast
World Energy will hold a conference call today, August 6, 2009, at 10:00 a.m. ET to discuss its Q2 2009 financial results. To access the conference call by telephone, dial 416-915-5761 or 1-866-249-5221. The conference call will be archived for replay until Thursday, August 13, 2009 at midnight. To access the archived conference call, please dial 416-640-1917 or 1-877-289-8525 and enter the reservation code 21311430 followed by the number sign.
A live audio webcast of the conference call will be available at www.worldenergy.com and www.newswire.ca. Please connect at least 15 minutes prior to the conference call to secure a line and ensure adequate time for any software download that may be required to join the webcast. An archived replay of the webcast will be available for 365 days.
About World Energy Solutions, Inc.
World Energy (NASDAQ: XWES; TSX: XWE) operates online exchanges for energy and green commodities. For buyers and sellers of electricity, natural gas, capacity, and green-energy assets who are impacted by today's volatile markets, World Energy's proven approach has transformed the normally complex procurement process into a powerful, streamlined vehicle for cost savings. In addition to enabling customers to seek competitive pricing on traditional energy commodities, World Energy is taking a leadership position in the emerging environmental-commodities markets. Its award-winning World Green Exchange(R) supports the ground-breaking Regional Greenhouse Gas Initiative's (RGGI) cap and trade program for CO2 emissions. For more information, please visit www.worldenergy.com.
This press release contains forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ from those indicated in the forward-looking statements. Such risks and uncertainties include, but are not limited to: we have a history of losses and cannot provide any assurance we will be profitable in any given period; our revenue is dependent on actual future energy purchases pursuant to completed procurements; the demand for our services is affected by changes in regulated prices or cyclicality or volatility in competitive market prices for energy; we depend on a small number of key energy consumers, suppliers and channel partners; there are factors outside our control that affect transaction volume in the electricity market; and there are other factors identified in our Annual Report on Form 10-K and subsequent reports filed with the Securities and Exchange Commission.
WORLD ENERGY SOLUTIONS, INC.
SUMMARY OF CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended
June 30, June 30,
-------------------------------------------------------
2009 2008 2009 2008
------------- ------------- ------------- -------------
Revenue $ 3,682,476 $ 2,760,695 $ 7,660,255 $ 5,875,212
-------
Cost of revenue 984,896 1,276,859 2,074,848 2,512,912
------------- ------------- ------------- -------------
Gross profit 2,697,580 1,483,836 5,585,407 3,362,300
Sales and marketing 2,662,921 2,770,924 5,233,469 5,414,660
General and
administrative 827,719 1,100,642 1,808,955 2,521,625
------------- ------------- ------------- -------------
Operating loss (793,060) (2,387,730) (1,457,017) (4,573,985)
--------------
Interest income
(expense), net (2,044) 7,413 (3,161) 33,726
------------- ------------- ------------- -------------
Loss before income
taxes (795,104) (2,380,317) (1,460,178) (4,540,259)
Income tax benefit - - - -
------------- ------------- ------------- -------------
Net loss $ (795,104) $ (2,380,317) $ (1,460,178) $ (4,540,259)
-------- ------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Loss per share:
Net loss per
common share -
basic and
diluted $ (0.09) $ (0.29) $ (0.17) $ (0.55)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Weighted average
shares
outstanding -
basic and
diluted 8,446,999 8,288,673 8,433,436 8,270,310
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
SUMMARY OF CONDENSED CONSOLIDATED BALANCE SHEET
June 30, 2009
--------------
Assets
------
Current assets $ 4,029,502
Property and equipment, net 444,131
Goodwill 3,178,701
Other assets 5,851,265
--------------
Total assets $ 13,503,599
--------------
--------------
Liabilities and stockholders' equity
------------------------------------
Accrued commissions $ 893,140
Accounts payable and accrued liabilities 1,903,519
Other current liabilities 732,402
--------------
Total current liabilities 3,529,061
Total long-term liabilities 24,222
Stockholders' equity 9,950,316
--------------
Total liabilities and stockholders' equity $ 13,503,599
--------------
--------------
SOURCE World Energy Solutions, Inc.
Back to Press Releases
|
|
|
