Amerigon Reports Record Fourth Quarter, Year-End Results
Sales More Than Double Year-Over-Year, Losses Narrowed
DEARBORN, Mich., March 17 -- Amerigon Incorporated today announced results for its fourth quarter and year-ended December 31, 2002, with record revenues, improved gross margins and significant decreases in net losses for both periods. Revenues for the 2002 fourth quarter were more than four times the year-earlier period. For the full year, revenues were more than two times the prior year. Unit volume of the Company's proprietary Climate Control Seat(TM) (CCS(TM)) system more than doubled in 2002 from 2001 which, according to Chairman Oscar (Bud) Marx, reflected strong demand from established vehicle programs and the adoption of CCS for five new vehicle programs in 2002.
Revenues for the 2002 fourth quarter grew to $6.4 million from the year- earlier period of $1.5 million, while the net loss for the 2002 fourth quarter declined to $1.1 million, or a loss per share of $0.11, from a net loss of $2.3 million or a loss per share of $0.50 for the fourth quarter of 2001. Fourth quarter revenues were a record $6.4 million, up 43 percent from the prior record of $4.5 million reported in the 2002 third quarter. The 2002 fourth quarter revenues included an extraordinary shipment of 12,000 CCS systems, or approximately $850,000, to Toyota. Toyota indicated to Amerigon that it purchased these systems to protect inventory during the transfer of manufacturing responsibilities for CCS blowers from Amerigon to Toyota's seat supplier as Amerigon completed its exit from manufacturing in California. Amerigon anticipates that future revenue levels from Toyota will be reduced by approximately $350,000 per quarter as a direct result of this transfer, with no impact on gross margins.
For the full 2002 year, revenues rose to $15.3 million, with a net loss of $6.3 million, or a $0.64 loss per share, compared with revenues of $6.4 million, with a net loss of $7.7 million, or a $1.66 loss per share for the year-earlier period. Gross margins for the 2002 fourth quarter and year were 23 percent and 22 percent, respectively, up from 12 percent and 13 percent, respectively, for the year-earlier periods.
Marx commented, "Despite widespread economic uncertainty, the Company had a banner year in 2002. It was the year we firmly established CCS as an important value-enhancing vehicle feature. During the year, Nissan Infiniti and General Motors (GM) chose CCS for their flagship product lines, joining Ford Motor Company and Toyota as customers."
The Company shipped more than 225,000 CCS systems in 2002 for use in a total of eight vehicle models, up from the 99,000 CCS systems shipped in 2001 for use in three vehicle models. Marx said that, based on current information, he anticipates volume will be up more than 50 percent in 2003 for use in 14 vehicle models, including the first shipments for GM vehicles.
"We made significant strides in enhancing the operational side of our business in 2002," Marx added, "as we successfully completed the outsourcing of our manufacturing operations from Irwindale to Mexico and China, and relocated our corporate headquarters to Dearborn, Michigan, to position it in the heart of the US automotive industry. I'm also encouraged by the significant progress we made in the development of our next generation products, which we believe will cut costs, improve performance and reduce the size and weight of CCS.
"As we look ahead, I am confident that 2003 can be another growth year for the Company. We expect to continue our solid top line growth, improve gross margins and in the latter half of the year achieve our first profitable quarter," Marx said. "As CCS continues to gain broad acceptance in the marketplace, we have recently announced three new vehicle programs that have selected CCS and plan to announce three additional vehicles in 2003. During the year, we will also see the first customers for our newest generation CCS system, the micro thermal module(TM) (MTM(TM)). On another important front, we will begin to reap the benefits in the development of thermoelectric devices (TED) with twice the efficiency of today's devices. This will dramatically expand the market for TED-based automotive and non-automotive products. We have a number of these new applications on test with customers."
Research and development expenses for the fourth quarter and year ended December 31, 2002, decreased 10 percent and increased 2 percent, respectively, over the year-earlier periods. The slight increase for the year was due primarily to an increase in the pace of the thermoelectric technology development efforts at the Company's BSST subsidiary and prototype costs associated with the Company's next generation CCS products.
Selling, general and administrative expenses for the 2002 fourth quarter and year increased 36 percent and 22 percent, respectively, over year earlier periods due primarily to costs associated with the outsourcing of manufacturing for the Company's North American customers to an assembly plant in Mexico and the relocation of the corporate office from California to Dearborn, Michigan.
In November 2002, Comerica Bank approved an asset-based revolving credit line of up to $3 million for Amerigon. The credit line is being used to finance working capital and to repay a bridge loan from Detroit-based Big Beaver Investments LLC, one of the Company's principal shareholders.
Amerigon must meet the Nasdaq requirement of $2.5 million of net equity or $35 million of market value for listed securities to retain its listing in 2003. Amerigon is developing plans to comply with Nasdaq's requirements.
The number of shares used to calculate basic and diluted net loss per share in the 2002 fourth quarter and year was 10.8 million and 9.9 million, respectively, compared with 4.7 million and 4.6 million, respectively, for the year-earlier periods. The year-to-year increase in shares resulted primarily from the sale of approximately 4.3 million shares of the Company's common stock and warrants to purchase 2.2 million shares of the Company's common stock in a private placement, valued at approximately $6.5 million, to selected institutional and other accredited investors. In addition, a bridge loan and accrued interest of $2.6 million were exchanged on the same terms by Big Beaver Investments LLC for 1.7 million shares of common stock and warrants to purchase 860,000 shares of common stock.
Conference Call
As previously announced, Amerigon is conducting a conference call to review the financial results today at 11:00 AM EST (Eastern). The dial-in number for the call is 1-800-946-0720. A live webcast and 10-day archive of the call can be accessed at www.viavid.com.
About Amerigon
Amerigon develops and markets its proprietary Climate Control Seat (TM) (CCS(TM)) products for automotive original equipment manufacturers (OEMs). This product significantly enhances individual driver and passenger comfort in virtually all climatic conditions by providing cooling and heating to seat occupants, as desired, through an active thermoelectric-based temperature management system. Amerigon is engaged in developing other proprietary thermoelectric-based heating and cooling products for automotive and other market applications. Amerigon maintains sales and technical support centers in Los Angeles, Detroit, Japan and Germany.
Certain matters discussed in this release, including projected shipments of CCS systems, the number of future launches on other automotive platforms, expected revenues for 2003, future profitability and volume of sales and research and development efforts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties, and actual results may be different. Such risks and uncertainties include future additional platforms, global vehicle demand and economic conditions, CCS take rates, market penetration, Amerigon cash requirements and other risks that may be defined in the Company's Securities and Exchange Commission filings and reports, including but not limited to its Form 10-K for the year ended December 31, 2002 and its Form 10-Q for the quarter ended September 30, 2002. The forward-looking statements should be considered in light of these risks and uncertainties.
AMERIGON INCORPORATED
CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share data)
Three Months Twelve Months
Ended December 31, Ended December 31,
2002 2001 2002 2001
Product revenues $6,423 $1,489 $15,271 $6,447
Cost of sales 4,959 1,315 11,983 5,600
Gross margin 1,464 174 3,288 847
Operating costs and expenses:
Research and development 988 1,094 3,910 3,836
Selling, general and
administrative 1,510 1,107 5,553 4,548
Total operating costs
and expenses 2,498 2,201 9,463 8,384
Operating loss (1,034) (2,027) (6,175) (7,537)
Interest income -- 5 20 54
Interest expense (156) (361) (318) (377)
Other income 50 50 200 150
Minority interest in net loss
of subsidiary (8) (7) (40) 19
Gain on disposal of property
and equivalent 7 -- 7 --
Net loss $0 $0 $(6,306) $(7,691)
Basic and diluted net loss
per share:
Loss before extraordinary item $(0.11) $(0.50) $(0.64) $(1.66)
Weighted average number of
common shares outstanding 10,771 4,718 9,859 4,629
AMERIGON INCORPORATED
CONSOLIDATED BALANCE SHEET
(In thousands, except share data)
December 31, December 31,
ASSETS 2002 2001
Current Assets:
Cash & cash equivalents $274 $952
Accounts receivable, less allowance of
$55 and $50, respectively 4,530 1,268
Inventory 1,903 1,163
Prepaid expenses and other assets 563 383
Total current assets 7,270 3,766
Property and equipment, net 1,324 1,192
Deferred exclusivity fee 585 878
Total assets $9,179 $5,836
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable $4,296 $1,446
Accrued liabilities 890 922
Bank loan payable 670 --
Bridge loan payable -- 2,037
Deferred manufacturing agreement
- current portion 200 200
Total current liabilities 6,056 4,605
Deferred manufacturing agreement
- long term portion 1,450 1,650
Minority interest in subsidiary 2 44
Total liabilities 7,508 6,299
Shareholders' equity (deficit):
Preferred stock:
Series A - no par value; convertible;
9,000 shares authorized, 9,000 issued
and outstanding at December 31, 2002
and 2001; liquidation preference of
$11,205 at December 31, 2002 8,267 8,267
Common stock;
No par value; 30,000,000 shares
authorized, 10,771,000 and 4,717,000
issued and outstanding at December
31, 2002 and 2001 43,051 39,192
Paid-in capital 19,504 14,945
Deferred compensation -- (22)
Accumulated deficit (69,151) (62,845)
Total shareholders' equity (deficit) 1,671 (463)
Total liabilities and shareholders'
equity (deficit) $9,179 $5,836
Contact: Allen & Caron Inc
Jill Bertotti (investors)
jill@allencaron.com
Len Hall (media)
len@allencaron.com
(949) 474-4300