Northern Power Systems Announces Fourth Quarter and Full Year 2016 Results

Fourth Quarter 2016 Highlights:

• Our cash and cash equivalents increased $2.2 million in fourth quarter of 2016 compared to $0.7 million for the same period in the prior year.
• Increased order backlog at December 31, 2016 to $28 million as compared to $25 million at December 31, 2015.
• Completed the sale of certain of our utility-scale wind assets to WEG SA; expanding our global collaboration with WEG with the potential to collect royalties for up to an additional $17.5M, over the next decade, for sales outside of South America.
• Negotiating a partnership with Eos Energy Storage to develop and offer integrated energy storage systems for utilities and commercial/industrial customers.

Year End 2016 Other Highlights:

• Expanded fleet of distributed wind turbines to over 600 turbines, with over 14 million of run time hours. Turbines under warranty continued to perform at greater than 98 percent availability.
• Reduced cash used in operations to $0.8 million from $4.4 million in the prior year. Delivered positive cash flow from operations in the 2nd through 4th quarters of 2016.
• Reduced operating expenses to $12.4 million (excluding a $1.0 million gain on the sale of assets to WEG and a $0.4 million goodwill impairment charge) from $16.1 million in the prior year.
• Renewed Comerica line of credit in the amount of $2.0 million through December 31, 2017.

Northern Power Systems Corp. (TSX: NPS) (the “Company” or “Northern Power Systems”), a next generation renewable energy technology company, today announced financial results for its fourth quarter and year ended December 31, 2016.

“During 2016, we announced our intention to monetize our utility wind assets, and focus on our core distributed wind turbine business as well as to expand into full-scope energy storage solutions.  With the completion of the sale of certain of our utility-scale wind technology and assets to our partner WEG, in October 2016, we consummated our planned refocus on distributed energy applications,” stated Ciel Caldwell, president and chief operating officer of Northern Power Systems.  “With the reduction of business expenses, and effective management of our balance sheet, we continue to be confident that we will not require additional investment in our business.”

“Our expansion into full-scope energy storage solutions in the distribution network is gaining traction as we have submitted multiple commercial bids and are negotiating initial order contracts,” Ms. Caldwell continued. “These activities, in combination with continued global distributed turbine sale traction, are validating our distributed energy strategy.”

Eric Larson, the Company’s chief accounting officer commented, “During the fourth quarter we maintained our focus on reducing costs in our efforts to reach profitability.  Our cash balance as of December 31, 2016 was $5.4 million, including $1.5 million received from the sale to WEG, which we feel positions the Company well to focus on our 2017 business objectives.”

Consolidated Fourth Quarter Financial Metrics:

• Revenue for the fourth quarter of fiscal year 2016 was $9.9 million, a 46 percent decrease over revenue of $18.4 million reported in the prior year period.
• Gross margin in the fourth quarter was 5.2 percent, down from 17.1 percent in the prior year period.
• Reduced operating expenses to $2.5 million (excluding the $1.0 million gain on the sale of assets to WEG and a $0.4 million goodwill impairment charge), compared to $3.3 million in fourth quarter of 2015 and our third quarter of 2016.
• Net loss for the fourth quarter of fiscal year 2016 was $0.8 million representing a 33 percent increase compared to a $0.6 million loss in the prior year period.
• Non-GAAP adjusted EBITDA loss for the fourth quarter was $1.1 million compared to non-GAAP adjusted EBITDA income of $0.5 million in the prior year fourth quarter. A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading “About non-GAAP financial measures.”

Consolidated Year End Financial Metrics:

• Revenues for fiscal year 2016 were $35.9 million, compared to $54.0 million in the prior year.
• Gross margin for the year was 7.9 percent, down from gross margin of 18.9 percent in the prior year.
• Net loss for fiscal year 2016 was $8.9 million, representing an 14 percent increase compared to a $7.8 million loss in 2015.
• Non-GAAP adjusted EBITDA loss for 2016 was $7.8 million compared to a non-GAAP adjusted EBITDA loss of $4.7 million in the prior year.
• Order backlog at December 31, 2016 was $28 million, a 12 percent increase compared to backlog of $25 million in the prior year.
• The Company’s cash and cash equivalents balance was $5.4 million at December 31, 2016.

Source:prnewswire