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Energy Focus, Inc. Reports Second Quarter 2013 Results

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SOLON, Ohio, Aug. 13, 2013 (GLOBE NEWSWIRE) -- Energy Focus, Inc. (OTCQB:EFOI) a leader in LED lighting technologies, today announced financial results for the second quarter ended June 30, 2013.

Financial results for the quarter include the following:

  • Net sales of $7.4 million for the second quarter of 2013 versus $7.7 million for the second quarter of 2012.
  • Gross margins of 27.4 percent of net sales compared to 22.2 percent of net sales for the second quarter of 2012.
  • A net loss of $0.7 million compared to a net loss $0.9 million in the second quarter of 2012.

James Tu, Executive Chairman, commented: "Our second quarter sales came in slightly lower than the same period last year as the Company reorganized its leadership structure and refocused its resources on the LED lighting retrofit markets. The quarter's sales were also impacted by a weaker pool lighting business due to colder weather. However, we are excited to see momentum building up across our businesses, and we believe our new initiatives to dramatically narrow our focus and to strengthen our planning and execution capabilities will start yielding results by year's end."

"Notably, we were able to continue to grow our Navy sales, which are on track to more than double from last year in spite of the sequester. A large portion of that increase is due to shipments against our $23 million LED contract with the Navy. As of today we've completed about $6.4 million, or about 28%, of the contract. Yet even after supplying the full contract we'll only have retrofitted about 7% of the fleet. With our first-mover advantage as the only approved LED tube provider for the Navy, we are also actively going after the Military Sealift Command as well as Coast Guard ships markets. Therefore we have barely scratched the surface of this opportunity, which by our estimate exceeds $500 million," continued Mr. Tu.

"Our sales pipeline for the Energy Services Company (ESCO) market —a multi-billion-dollar market opportunity—continues to grow with many new lighting retrofit opportunities going all LED. We expect to see the revenue impact of our growing pipeline and the contracts in place beginning in the second half of 2013 and beyond," commented Mr. Tu.

"Last but not least, we are very encouraged by the improvement in our gross margins. We believe that we will be able to continue to improve our gross margins, a critical element to become EBITDA positive in the second half of 2013," said Mr. Tu.

Energy Focus, Inc. will host a conference call and webcast on Tuesday, August 13, 2013 at 4:30 p.m. EDT (1:30 p.m. PDT) to review the second quarter of 2013 financial results, followed by a Q & A session. The webcast can be accessed under the investor section of our website at www.energyfocusinc.com. The call can be accessed by dialing 888-572-7033 (US and Canada) or 719-325-2361 (International/Local). The conference access code is 9071372. Participants are asked to call the assigned number approximately 10 minutes before the conference call begins.

An instant replay of the conference call will be available through the investor relations section of the site http://www.energyfocusinc.com/investors/events/category/investors starting August 13, 2013 and will remain available for 3 months.

Forward Looking Statements

Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For more information about potential factors that could affect the financial results of Energy Focus, please refer to the Company's SEC reports, including its Annual Reports on Form 10-K and its quarterly reports on Form 10-Q. These forward-looking statements speak only as of the date hereof. Energy Focus disclaims any intention or obligation to update or revise any forward-looking statements.

About Energy Focus, Inc.

Energy Focus, Inc. is a leading provider of energy efficient LED lighting products, turnkey energy efficient lighting solutions and a developer of energy efficient lighting technology. Our solutions provide energy savings, aesthetics, safety and maintenance cost benefits over conventional lighting. Our long-standing relationship with the U.S. Government includes numerous research and development projects for the DOE and DARPA, creating energy efficient LED lighting systems for the U.S. Navy fleet.

Customers include national, state and local U.S. government agencies as well as Fortune 500 companies, the U.S. Navy, swimming pool builders and many others. Company headquarters are located in Solon, OH, with additional offices in Nashville, TN, Pleasanton, CA, and the United Kingdom. For more information, see our web site at www.energyfocusinc.com.

ENERGY FOCUS, INC.
CONSOLIDATED BALANCE SHEETS
(amounts in thousands except share and per share amounts)
June 30, December 31,
2013 2012
ASSETS (unaudited)
Current assets:
Cash and cash equivalents, includes restricted cash of $59 and $252, respectively $ 2,266 $ 1,181
Trade accounts receivable less allowances of $158 and $265, respectively 4,133 5,319
Retainage receivable 190 634
Inventories, net 2,383 2,581
Costs in excess of billings 127 99
Prepaid and other current assets 1,279 1,012
Total current assets 10,378 10,826
Property and equipment, net 1,624 1,800
Intangible assets, net 156 608
Collateralized assets 1,000 1,000
Other assets 135 119
Total assets $ 13,293 $ 14,353
LIABILITIES
Current liabilities:
Accounts payable $ 3,826 $ 5,879
Accrued liabilities 1,603 2,265
Deferred revenue 226 751
Billings in excess of costs 319 464
Credit line borrowings 1,602 1,590
Current maturities of long-term debt 305 756
Total current liabilities 7,881 11,705
Other liabilities 58 30
Long-term debt 4,065 1,793
Total liabilities 12,004 13,528
SHAREHOLDERS' EQUITY
Preferred stock, par value $0.0001 per share:
Authorized: 2,000,000 shares in 2013 and 2012
Issued and outstanding: no shares in 2013 and 2012 -- --
Common stock, par value $0.0001 per share:
Authorized: 100,000,000 shares in 2013 and 2012
Issued and outstanding: 49,158,886 at June 30, 2013 and 44,698,650 at December 31, 2012 5 4
Additional paid-in capital 83,594 80,985
Accumulated other comprehensive income 421 460
Accumulated deficit (82,731) (80,624)
Total shareholders' equity 1,289 825
Total liabilities and shareholders' equity $ 13,293 $ 14,353
ENERGY FOCUS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except per share amounts)
Three months ended Six months ended
June 30, June 30,
2013 2012 2013 2012
Net sales $ 7,381 $ 7,672 $ 12,714 $ 12,974
Cost of sales 5,359 5,968 9,491 10,485
Gross profit 2,022 1,704 3,223 2,489
Operating expenses:
Research and development 172 (61) 209 (15)
Sales and marketing 1,498 1,390 2,801 2,661
General and administrative 1,273 1,114 2,339 2,268
Loss on impairment 325 -- 325 --
Change in estimate of contingent liabilities 12 -- 12 --
Total operating expenses 3,280 2,443 5,686 4,914
Loss from operations (1,258) (739) (2,463) (2,425)
Other income (expense):
Settlement of acquisition obligations 892 -- 892 --
Other expense (145) (44) (239) (72)
Interest income -- -- -- 1
Interest expense (167) (114) (293) (265)
Loss before income taxes (678) (897) (2,103) (2,761)
Provision for income taxes (1) (3) (4) (6)
Net loss $ (679) $ (900) $ (2,107) $ (2,767)
Net loss per share - basic and diluted $ (0.01) $ (0.02) $ (0.05) $ (0.07)
Shares used in computing net loss per share - basic and diluted 46,230 44,513 45,469 38,067

CONTACT: Media Contact: Energy Focus, Inc. Public Relations Office (440) 715-1295 pr@energyfocusinc.com Investor Contact: Brion Tanous CleanTech IR, Inc. (310) 541-6824 btanous@cleantech-ir.com

Source:Energy Focus, Inc.

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