Ascent Solar Technologies, Inc. reported results for the third quarter ended September 30, 2015.
Financial Results for the Third Quarter and Nine Months Ended September 30, 2015
Total revenue for the third quarter of 2015 was $1.3 million, compared to $1.1 million reported for the same period last year, which was an increase of 10%. Sequential quarterly revenue resulted in a 43% decline from the second quarter of 2015, which the Company attributes to shipment backlogs and cash flow constraints related to the restructuring of its balance sheet during the quarter. However, net loss for the quarter totaled $6.1 million, which is a significant improvement of 100% compared to a net loss of $12.2 million reported for the same period last year.
For the nine-months ended September 30, 2015, total revenue was $4.1 million, which was a 39% increase from $3.0 million reported for the same period last year. The Company attributes the gain to broadening its retail distribution for EnerPlex. Loss from operations improved 16% to $20.9 million for the 2015 nine month period, compared to $24.9 million reported for the same period in 2014. This was due to a combination of increasing revenue and improved operational efficiencies, while keeping expenses marginally down for the period. These expenses are expected to remain relatively flat while the Company continues to increase revenue growth.
Balance Sheet Highlights for the Nine-Months Ended September 30, 2015
Cash and Restricted Cash declined from $31.3 million to $619 thousand, as a direct result of the Company's restructuring of debt and related warrants in the quarter. Restricted cash was utilized to retire a major portion of the senior secured notes, as announced on September 8, 2015. As a result, five major liability line items (Current Portion of Convertible Note Payable, Short Term Embedded Derivative Liabilities, Long-Term Convertible Note, Warrant Liability and Long Term Embedded Derivative Liabilities) totaling $35.1 million as of December 31, 2014 is now completely removed from the Balance Sheet as of September 30, 2015. Added to that are two new items (September 2015 Fixed Rate Convertible Notes and Investor Payable) totaling $8.2 million. The Company expects the $6.2 million Investor Payable to be mostly or entirely retired by the end of the calendar 2015 year. Thereafter, the Company would have a much cleaner balance sheet without any warrants or derivative liabilities associated with the senior secured notes. Subsequent to the end of the third quarter, the Company announced an equity investment from a new investor on November 11, 2015.
"While we are not satisfied with the results after a strong second quarter, we feel we are in a much better financial position after our recent balance sheet restructuring activity," said Victor Lee, President and CEO of Ascent Solar Technologies, Inc. "Third quarter operations were severely impacted by our cash flow constraints due to the ongoing senior secured notes restructuring exercise that was announced in September and October of 2015. As announced most recently on November 11, 2015, the Company has secured a new funding source and expects that the existing senior secured notes will be mostly or entirely retired by the end of the year."
Mr. Lee continued, "While the results have been constrained by the notes restructuring, we feel that it was necessary for the Company to take the short term hit, clean up the capital structure and benefit from a much more sustainable future. As highlighted in the previous announcement on September 8, 2015, we believe that the Company's long term growth value has not been fully appreciated in the market and that the Company's stock price has been severely depressed due to the significant sale of stock into the market relating to the senior secured notes."
Mr. Lee concluded, "We hope to put this result to bed as we look forward to a solid fourth quarter and a much stronger 2016 now that new funding with less restrictive and more straightforward terms and conditions is in place. As it stands today, we have shipped approximately $1.6 million of merchandise so far this quarter and expect to end the quarter with approximately $3.1 million revenue and full year revenues of approximately $7.2 million. While this would fall short of our earlier guidance of a minimum of $10 million, given all the constraints that we have had, it still represents healthy growth of approximately 34% year-over-year. We look forward to moving ahead with our new investor and updating our shareholders as we execute on our growth strategy."