NEW CASTLE, Pa., April 1, 2014 /PRNewswire/ -- Axion Power International, Inc. (OTC QB: AXPW), the developer of advanced lead-carbon PbC® batteries and energy storage systems, announced results for its year ended December 31, 2013.
For the full year 2013, net sales were $10.2 million with a net loss of $11.9 million (including a non cash loss of $3.6 million) or $0.09 loss per share compared to net sales in 2012 of $9.8 million, with a net loss of $8.6 million or $0.08 loss per share. The net sales in both 2013 and 2012 were primarily generated by the sale of lead-acid batteries to a large international battery company. The increase in net loss of $3.4 million in 2013 resulted from non - cash charges of $3.7 million related to the accounting for the senior convertible notes as more fully described in our 2013 Form 10K that we filed on March 31, 2013. Operating loss in 2013 was $8.2 million compared to an operating loss of $8.6 million in 2012, a decrease of $0.4 million. Net cash used in operating activities for the year was $6.2 million as compared to $7.7 million for 2012. Net cash used in investing activities for the year was $229 thousand as compared to $854 thousand in 2012.
Axion Power had cash and cash equivalents at December 31, 2013 of $1.2 million, with restricted cash of $3.8 million, compared to cash and cash equivalents of $2.0 million at December 31, 2012 with no restricted cash. At December 31, 2013, the Company's current ratio was 2.26:1.
Chairman & CEO Thomas Granville commented, "During 2013 we continued the commercialization ramp up of our PbC technology, Battery Management System (BMS), and other related electronics. We have been asked on more than one occasion, to rank our opportunities for significant near term market penetration. While we probably would have had a different ranking a few years ago, we � as a company � are very comfortable ranking our best near term opportunity as the energy storage markets that focus on renewables (such as wind and solar) and on the ancillary services market that includes power smoothing, load leveling, peak shaving and especially frequency regulation. We learned a great deal about this market from our first PowerCube installation here at Axion, which we integrated into the PJM utility network in 2011. PJM is the largest provider of wholesale electricity in North America, providing power to more than 61 million people. Although the initial focus of this install was not frequency regulation, (it was indeed to provide us with a test bed for string applications and for battery testing with solar products), changes initiated by the Federal Energy Regulatory Commission (FERC) opened up a new opportunity for our PowerCube technology. FERC's rulings covering Demand Response Compensation in 2011, and Pay for Performance in 2013, changed the landscape. Our onsite PowerCube can now participate in the PJM frequency regulation market 24/7 if we so choose, because we have scored above 90 out of 100 on the PJM rating system since our PowerCube's initial link into the system. Because we respond to the PJM signal in milliseconds, we are paid a bonus over and above our base compensation under the FERC 'Pay for Performance' regulation."
Granville continued, "There are certain federal and state tax credits that can apply to energy storage assets like our PowerCube when the asset is combined with solar. So our recent initiatives, such as the purchase order we received for a '500kw up and 500kw down' PowerCube system in New Jersey, take advantage of three separate revenue streams from the frequency regulation market � demand response compensation, pay for performance and solar tax credits. The PowerCube value proposition provides an owner with a very attractive investment with a high Internal Rate of Return. Our Axion Model seeks to maximize IRR's and return all investment dollars in the first five years~, (a One MW system for example, annually grosses $250,000. ~ just from frequency regulation). In addition, the PowerCube provides storage for the solar project while also providing project power in emergency situations," Granville concluded.
Axion currently has numerous inquiries, and is in various stages of proposal responses, for similarly designed systems, as well as for energy backup systems, both in North America and in some island nations, where electricity generated by turbines can be � and usually is � very expensive.
"We have continued to promote our two - battery solution for the stop/start market as well as proprietary activated carbon solutions for other markets that require high charge acceptance and long cycle life," Granville said. "But more and more, our focus is moving toward providing our PbC batteries for the heavy duty Class 8 (18-wheeler) series hybrid retrofit solution implemented by ePower Engine Systems. Historically, DOT, NHTSA and EPA SmartWay data have quoted 'mpg of diesel' numbers of approximately 6 mpg for these Class 8 trucks. Working together, over the past three years, ePower with Axion's PbC batteries, has shown fuel improvement of approximately 35% to date and ePower feels the numbers can be further improved in the short term."
Granville continued, "Each converted ePower truck now has 56 PbC batteries and a sophisticated BMS proprietary to Axion Power. The system is designed to utilize the batteries to regulate fuel consumption by providing boost power when needed to accelerate, navigate grade variances and initially bring the truck up to speed, all while allowing the motor and generator to operate at a constant rate of speed. In addition, the batteries in the ePower system utilize regenerative braking which requires a battery with fast re-charge properties, a strong point of the PbC product. There is a huge market out there, a fleet of some 2.4 million Class 8 trucks is currently on the road. That fleet is rebuilt every 4 to 6 years, so the market is approximately 400,000 to 600,000 conversions on an annual basis. One and a half percent of that market is north of $125 million in battery revenue on an annual basis.
"Axion continues to pursue several other markets including: hybrid locomotives; backup to solar charging stations; storage for wind farms; street lights in third world countries; islanded power solutions where there is no grid; community storage; utility buffering; motive power for unique industry solutions; and more," Granville concluded.
The Company's management team will host a conference call to discuss its fourth quarter and year ended December 31, 2013 results tomorrow, Tuesday April 1, 2014 at 10:00 am Eastern Time.
Participants should dial into the call ten minutes before the scheduled time using the following numbers: 1-877-300-8521 (USA) or +1-412-317-6026 (international) to access the call.
There will also be a simultaneous live webcast through the Company's website, www.axionpower.com and selecting the investor tab. Participants should register on the website approximately ten minutes prior to the start of the webcast.
An audio replay of the conference call will be available for seven days and can be accessed by dialing 1-877-870-5176 (USA) or +1-858-384-5517 (international) and using passcode 10042820. For those unable to attend to the live webcast, it will be archived shortly following the event for 30 days in the Investors section of the Company's website.
About Axion Power International, Inc.
Axion has developed and patented a next generation energy storage device that won the prestigious Frost & Sullivan Technology Award for North America in the field of lead-acid batteries. According to Frost & Sullivan, Axion's new PbC® batteries have "the potential to revitalize the lead-acid battery industry by breathing new life into an established technology that has not been well suited to the requirements of important new applications like hybrid electric vehicles and renewable power."
Axion Power International, Inc. is the industry leader in the field of lead-carbon energy storage technologies. Axion believes its new PbC battery technology is the only class of advanced battery that can be assembled on existing lead-acid battery production lines throughout the world utilizing Axion's proprietary activated carbon electrodes. Axion's future goal, after filling their plant's lead-carbon battery production capacity, is to become the leading supplier of carbon electrode assemblies for the global lead-acid battery industry.
For more information, visit www.axionpower.com
Certain statements in this Press Release are "forward-looking statements" within the meaning of the Private Securities Litigation Act of 1995. These forward-looking statements are based on our current expectations and beliefs and are subject to a number of risk factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Such risks and uncertainties include the risk for the Company to complete its development work, as well as the risks inherent in commercializing a new product (including technology risks, market risks, financial risks and implementation risks, and other risks and uncertainties affecting the Company), as well as other risks that have been included in filings with the Securities and Exchange Commission, all of which are available at www.sec.gov. We disclaim any intention or obligation to revise any forward-looking statements, including, without limitation, financial estimates, whether as a result of new information, future events, or otherwise.
Axion Power International, Inc.
Thomas Granville, CEO
(724) 654 9300
Len Hall (Media)
� FINANCIAL TABLES FOLLOW�
AXION POWER INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
December 31, 2013
December 31, 2012
Cash and cash equivalents
Accounts receivable, net
Other current assets
Total current assets
Property & equipment, net
LIABILITIES AND STOCKHOLDERS' EQUITY
Accrued interest convertible notes
Subordinated convertible notes, net of discount
Senior convertible notes, net of discount
Total current liabilities
Derivative liability senior warrants
Convertible preferred stock-12,500,000 shares authorized
Series-A preferred � 2,000,000 shares designated 0 shares issued and outstanding
Common stock-350,000,000 shares authorized $0.0001 par value
180,401,405 issued & outstanding (113,260,006 in 2012)
Additional paid in capital
Cumulative foreign currency translation adjustment
Total stockholders' equity
Total liabilities & stockholders' equity
AXION POWER INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS and COMPREHENSIVE LOSS
Year Ended December 31,
Cost of tangible goods sold
Cost of goods sold � idle capacity
Research and development
Selling, general and administrative
Other (income) expense
Change in value of senior warrants, gain
Change in value conversion feature senior notes, gain
Debt discount amortization expense
Interest expense, note payable
Extinguishment loss on senior notes conversion
Derivative revaluations (gain) loss
Interest on convertible notes
Loss before income taxes
Foreign Translation Adjustment
Basic and diluted net loss per share
Weighted average common shares outstanding
SOURCE Axion Power International, Inc.