FuelCell Energy reported a net loss to common shareholders for the first quarter of fiscal 2006 of $16.7 million or $0.34 per basic and diluted share, compared to a net loss to common shareholders of $19.4 million or $0.40 per basic and diluted share in the same period of the previous year. Revenues, for the first quarter of fiscal 2006, were $5.9 million compared to $7.6 million in the prior year.
Net cash and investments used during the quarter was $17.1 million, compared to $20.0 million in 2005, excluding the proceeds of $99.0 million from the sale of preferred shares in the first quarter of fiscal 2005. Capital spending in the quarter totaled $3.6 million, which included approximately $2.8 million for equipment built for power purchase agreements. Depreciation and amortization expense for the quarter ended January 31, 2006 was approximately $2.3 million. Total cash and investments at January 31, 2006 was $162.8 million.
Administrative and selling expenses were $4.2 million for the quarter ended January 31, 2006, compared to $3.1 million in 2005. The year over year increase includes $0.7 million of stock based compensation recognized as a result of adopting Statement of Financial Accounting Standard 123R, “Share-Based Payment” (SFAS 123R). In addition, marketing and professional costs were approximately $0.3 million higher on increased market development and proposal activity for R&D and commercial contracts.
Research and development expenses for the quarter ended January 31, 2006 were $5.9 million, compared to $5.2 million in 2005. The increase is due to development for sub-megawatt and megawatt cost reduction and stack life improvements.
Effective November 1, 2005, the Company adopted SFAS 123R using the modified prospective method. For the three months ended January 31, 2005, stock compensation was accounted for under Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees.” Total stock based compensation recorded in the first quarter of fiscal 2006 was $1.1 million or $(0.02) per basic and diluted share. Stock based compensation is recorded in all cost and expense line items on the consolidated statement of operations. There was no stock compensation recognized in the consolidated statement of operations during the three months ended January 31, 2005.
“Markets are demanding distributed generation solutions that are efficient, reliable and environmentally responsible,” said R. Daniel Brdar, President and CEO of FuelCell Energy. “Our products address those needs today. Our strategy is to continue reducing costs, meet customer expectations, and develop repeatable markets. Opportunities in the growing megawatt and multi-megawatt markets should accelerate our path to profitability.”
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