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AETI Announces Q1 Profits

HOUSTON, May 7, 2015 (GLOBE NEWSWIRE) -- American Electric Technologies, Inc. (Nasdaq:AETI), a leading supplier of power delivery solutions for the global energy industry, today announced its first quarter 2015 financial results.

The Company reported net earnings attributable to common shareholders in the first quarter of $0.2 million, up from a loss in the fourth quarter of 2014 of ($2.1) million, and down from $0.5 million profit in the first quarter of 2014.

The Company reported consolidated revenue of $15.3 million, up from $13.7 million in Q4 2014 but down from $15.8 million in Q1 of 2014. M&I Electric Brazil, the Company's wholly owned Brazilian subsidiary, accounted for $0.6 million of consolidated revenue in the first quarter.

"The improved profitability in Q1 was the result of very hard work by our team in resolving the execution challenges related to our new product introductions and some project related execution issues that drove us to losses in Q3 and Q4", said Charles Dauber, president and chief executive officer, AETI. "We are executing our strategy to build the products, capabilities, capacity and the team to become a market leading provider of power delivery solutions to the global energy industry and we are well positioned to succeed in growing our market share for our products and services."

Gross margins improved by $2.2 million in the quarter, up to 14.9%, up from 0% in the fourth quarter but were down versus the 15.4% in the first quarter of 2014.

Consolidated income from continuing operations was $0.3 million for Q1, a $2.6 million improvement over Q4 but down versus $0.5 million in Q1 of 2014.

The Company's international joint ventures reported net equity income of $ 0.02 million for the quarter, including $0.2 million of equity income from BOMAY in China, a loss of $0.1 million from MIEFE in Singapore, and joint venture related expenses totaling $0.1 million.

The Company reported fully diluted earnings from continuing operations per share of $0.02 for the quarter, up from a loss of ($0.25) per diluted share in the fourth quarter of 2014 but down from earnings of $0.09 per fully diluted share reported in the first quarter of 2014.

The Company reported backlog of $18.6 million, down from $26.5 million in the fourth quarter of 2014, but up over 40% from the $13.2 million of total backlog reported at the end of Q1 2014.

Beginning with the first quarter 2015, the Company's operations consist of a single reporting segment. Additional information on the Company's segment reporting can be found in Form 10-Q.

Conference Call

AETI will conduct a conference call at 10 a.m. EDT on May 7 to discuss the results with analysts, investors and other interested parties. Individuals who wish to participate in the conference call should dial 866-952-1907 passcode 884605, in the United States and Canada. International callers should dial +1 785-424-1826 passcode 884605.

American Electric Technologies, Inc. (Nasdaq:AETI) is a leading provider of power delivery solutions to the global energy industry. AETI offers M&I Electric power distribution and control products, electrical services, and construction services.

AETI is headquartered in Houston and has global sales, support and manufacturing operations in Beaumont, Texas; Bay St. Louis, Mississippi; and Macaé and Rio de Janeiro, Brazil. In addition, AETI has minority interests in two joint ventures, which have facilities located in Xian, China and Singapore. AETI's SEC filings, news and product/service information are available at www.aeti.com.

Forward Looking Statements

This press release contains forward-looking statements, as defined in Section 27A of the Securities Exchange Act of 1934, concerning anticipated future domestic and international demand for our products, and other future plans and objectives. While the Company believes that such forward-looking statements are based on reasonable assumptions, there can be no assurance that such future revenues, profits, plans and objectives will be achieved on the schedule or in the amounts indicated. Investors are cautioned that these forward-looking statements are not guarantees of future performance. Actual events or results may differ from the Company's expectations, and are subject to various risks and uncertainties, including those listed in Item 1A of the Form 10-K filed with the Securities and Exchange Commission on March 30, 2015. The Company assumes no obligation to publicly update or revise its forward-looking statements even if experience or future events make it clear that any of the projected results expressed or implied herein will not be realized.

American Electric Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
Unaudited
(in thousands, except share and per share data, percentages calculated on total sales)
Three Months Ended
March 31, December 31
2015 2014 2014
Net sales $ 15,311 $ 15,848 $ 13,693
Cost of sales 13,028 13,413 13,656
Gross profit 2,283 15% 2,435 15% 37 0%
Operating expenses:
Research and development 138 66 155
Selling and marketing 603 663 667
General and administrative 1,267 1,208 1,572
Total operating expenses 2,008 13% 1,937 12% 2,394 17%
Income (loss) from consolidated continuing operations 275 498 (2,357)
Net equity income from foreign joint ventures' operations:
BOMAY 191 548 261
MIEFE (75) (36) (1)
AAG -- (38) --
Foreign joint ventures' operations related expenses (98) (112) (110)
Net equity income from foreign joint ventures' operations 18 362 150
Income (loss) from consolidated continuing operations and net equity income from foreign joint ventures' operations 293 2% 860 5% (2,207) -16%
Other income (expense):
Interest expense and other, net (19) (12) (109)
Continuing operations income (loss) before income taxes 274 848 (2,316)
Provision for income taxes on continuing operations -- (334)
Net income (loss) from continuing operations 274 848 (1,982)
Discontinued operations income (loss) -- (268) --
Provision for income taxes on discontinued operations -- -- --
Net income (loss) from discontinued operations -- (268) --
Net income (loss) before dividends on redeemable convertible preferred stock 274 580 (1,982)
Dividends on redeemable convertible preferred stock (87) (86) (87)
Net income (loss) attributable to common stockholders $ 187 1% $ 494 3% $ (2,069) -15%
Earnings (loss) from continuing operations per common share:
Basic $ 0.02 $ 0.09 $ (0.25)
Diluted $ 0.02 $ 0.09 $ (0.25)
Weighted - average number of continuing operations shares outstanding:
Basic 8,206,684 8,053,497 8,185,224
Diluted 8,441,782 9,625,258 8,185,224
Loss per common share from discontinued operations:
Basic and diluted 0.00 (0.03) 0.00
Total Earnings (loss) per common share:
Basic $ 0.02 $ 0.06 $ (0.25)
Diluted $ 0.02 $ 0.06 $ (0.25)
Weighted - average number of common shares outstanding:
Basic 8,206,684 8,053,497 8,185,224
Diluted 8,441,782 8,625,258 8,185,224
American Electric Technologies, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
March 31, 2015 December 31, 2014
(Unaudited) (Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 2,619 $ 3,550
Accounts receivable-trade, net of allowance of $275 and $315 at March 31, 2015 and December 31, 2014, respectively 12,445 11,877
Inventories, net of allowance of $91 and $73 at March 31, 2015 and December 31, 2014 3,128 2,769
Costs and estimated earnings in excess of billings on uncompleted contracts 3,630 2,989
Prepaid expenses and other current assets 682 750
Total current assets 22,504 21,935
Property, plant and equipment, net 8,449 8,373
Investments in foreign joint ventures 12,105 12,054
Other assets 232 242
Long-term assets held for sale 650 650
Total assets $ 43,940 $ 43,254
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 7,319 $ 6,447
Accrued payroll and benefits 985 1,145
Other accrued expenses 371 640
Billings in excess of costs and estimated earnings on uncompleted contracts 2,174 1,983
Short-term notes payable 267 222
Other current liabilities 179 150
Total current liabilities 11,295 10,587
Notes payable 3,711 3,778
Deferred income taxes 2,969 3,046
Deferred compensation 294 290
Total liabilities 18,269 17,701
Convertible preferred stock
Redeemable convertible preferred stock, series A, net of discount of $707 and $729 at March 31, 2015 and December 31,2014, respectively; $.001 par value, shares issued and outstanding 1,000,000 March 31, 2015, and December 31, 2014 4,293 4,281
Common stockholders' equity:
Common stock; $0.001 par value, 50,000,000 shares authorized, 8,249,458 and 8,185,323 shares issued and outstanding at March 31, 2015 and December 31, 2014, respectively 8 8
Treasury stock; at cost (131,928 shares at March 31, 2015 and 111,640 shares at December 31, 2014) (792) (722)
Additional paid-in capital 11,554 11,418
Accumulated other comprehensive income 704 851
Retained earnings; including accumulated statutory reserves in equity method investments of $2,100 at March 31, 2015 and December 31, 2014, respectively 9,904 9,717
Total common stockholders' equity 21,378 21,272
Total liabilities, preferred stock and stockholders' equity $ 43,940 $ 43,254
American Electric Technologies, Inc. and Subsidiaries
Non-GAAP Financial Measures and Reconciliations
Computation of Earnings on Continuing Operations , Including Net Equity Income from Foreign Joint Ventures, Before Interest,
Dividends, Taxes, Depreciation and Amortization ("EBITDA")
Unaudited
(In thousands)
Three months ended
March 31, March 31, December 31,
2015 2014 2014
Net Income (loss) on continuing operations attributable to common stockholders $ 187 $ 762 $ (2,069)
Add:
Dividends on redeemable preferred stock 87 86 87
Depreciation and amortization 237 128 227
Interest expense and other, net 19 12 109
Provision for income taxes -- -- (334)
EBITDA $ 530 $ 988 $ (1,980)
(1) The Company is disclosing EBITDA, which is a non-GAAP measure, because it is used by management and provided to investors to provide comparability of underlying operational results. For more discussion of the use and limitations of EBITDA, see the 2014 10-K which was filed on March 30, 2015.

CONTACT: Investor Contact: American Electric Technologies, Inc. Andrew L. Puhala 713-644-8182 investorrelations@aeti.com

Source:American Electric Technologies, Inc.