CARLISLE, IA--(Marketwire - January 14, 2011) - GreenMan Technologies, Inc. (
OTCBB:
GMTI),
today announced results for the three months and fiscal year ended
September 30, 2010.
Lyle Jensen, GreenMan's President and Chief Executive Officer, stated,
"Fiscal 2010 was a busy and productive year for our Company, notable for
the solid progress we achieved placing our American Power Group's (APG)
dual fuel technology with customers in the U.S. and abroad, for use in both
vehicular and stationary applications. In July, we received an order from
the local distributor in Nigeria on behalf of Seven-Up Bottling Company for
the conversion of 25% of their fleet. We are also working with the
Nigerian Bottling Company, the authorized bottler for Coca-Cola Hellenic,
for the upgrade of three generators. Domestically, we worked with Mutual
Redevelopment Houses, Inc. to convert 33% of the stationary diesel engines
at their Penn South cooperative housing facility in New York City.
"Subsequent to the close of our fiscal year, we signed a contract with
Kleenheat Gas, a subsidiary of Wesfarmers LNG and one of Australia's
leading providers of gas services, for a 90-day trial conversion of heavy
duty trucks to APG's dual fuel system using diesel fuel and liquefied
natural gas. The conversion trial continues to go well and we look forward
to discussing a broader relationship with Wesfarmers in the coming months.
Following the close of the year we launched our dual fuel products in India
through our partnership with Kirloskar Integrated Technologies, a division
of Kirloskar Group, India's largest manufacturer of air-cooled and
liquid-cooled diesel engines.
"While I am very proud of the relationships we've built with prominent
international partners for the commercialization of our technology in
leading natural gas using worldwide markets, perhaps our most important
work during the year was our effort toward securing domestic dual fuel
vehicular test exemptions from the EPA, which we were granted in late
December. The granting of these exemptions is a major achievement for our
company because it allows us to demonstrate and document the positive
economic and environmental impact that our dual fuel system can have on
aftermarket diesel vehicles operating in North America by significantly
reducing CO, NOX and Particulate Matter emissions from older and more
polluting diesel engines while delivering 25%-35% net fuel savings.
"Our achievements in the past year, both internationally and domestically,
have strengthened our foundation for growing our business through the
strategic commercialization of our dual fuel technology. In late December
we engaged Northland Capital Markets to help us achieve our 2011
commercialization initiative and international expansion and we believe
their past experience and extensive knowledge of the Alternative Energy
sector will provide valuable support to our Company. We continue to see
tremendous growth potential in the alternative fuel market and believe our
compelling technology, combined with our growing portfolio of partners and
distributors will lead to increased opportunities in the worldwide
marketplace."
Conference Call
Please join us Tuesday, January 18 at 11:00 AM EST for a conference call in
which we will discuss the results for the quarter and fiscal year ended
September 30, 2010. To participate, please call 1-888-215-6895 and ask for
the GreenMan call using pass code 2406555. A replay of the conference call
can be accessed until 11:50 PM on February 1, 2011 by calling
1-888-203-1112 and entering pass code 2406555.
Our business changed substantially in November 2008, when we sold
substantially all of the assets of our tire recycling operations. Since we
operated our tire recycling assets during only a portion of the fiscal year
ended September 30, 2009 we have included relevant information on this
business segment but have classified its assets, liabilities and results of
operations as discontinued operations for all periods presented in the
accompanying consolidated financial statements. On July 27, 2009 we
purchased substantially all the dual fuel conversion operating assets of
American Power Group (excluding its dual fuel patent). The results
described below include the operations of American Power Group since July
27, 2009.
Results of Operations
Three Months ended September 30, 2010 Compared to the Three Months ended
September 30, 2009
Net sales from continuing operations for the three months ended September
30, 2010 decreased $440,000 or 22 percent to $1,577,000 as compared to net
sales of $2,017,000 for the three months ended September 30, 2009. The
decrease is primarily attributable to decreased playground tile and
equipment sales in the Midwestern and Western regions of the United States
due to a general economic slowdown during fiscal 2010. A majority of our
revenue is derived from specific one-time installations with minimal
follow-on revenue from the installed project, thus making annual revenue
comparisons particularly difficult. In addition, our new American Power
Group dual fuel subsidiary recorded $138,000 of revenue during the three
months ended September 30, 2010 as compared to no revenue during the three
months ended September 30, 2009.
During the three months ended September 30, 2010 we incurred gross profit
of $293,000 as compared to a gross profit of $320,000 during the three
months ended September 30, 2009. The improvement was due to product mix
changes and slightly lower production costs during the year from our
recycled rubber products operation which offset the inclusion of $90,000 of
unabsorbed costs in excess of revenues associated with our dual fuel
subsidiary.
Selling, general and administrative expenses for the three months ended
September 30, 2010 decreased $288,000 to $1,161,000 as compared to
$1,449,000 for the three months ended September 30, 2009. The decrease was
primarily attributable to reduced performance based incentives which were
offset by the inclusion of $335,000 in costs associated with increased
sales and marketing initiatives for our American Power Group subsidiary.
Expenses for internal research and development projects relating to the
introduction of new dual fuel products, enhancements made to the current
family of duel fuel products, and research and development overhead were
$238,000 for the three months ended September 30, 2010. There were no
research and development expenses during the three months ended September
30, 2009.
During fiscal 2008 and 2009, Green Tech Products incurred significant
operating losses and had negative cash flow from operations. Green Tech
also had stagnant revenue growth in fiscal 2009. As a result of the losses
and our annual evaluation of potential goodwill impairment, management has
determined the carrying value of Green Tech Product's goodwill to be
impaired and accordingly wrote-off all goodwill, recording a non-cash
impairment loss of $2,290,000 during the three months ended September 30,
2009.
As a result of the foregoing, our loss from continuing operations after
income taxes decreased $2,331,000 to $1,141,000 for the three months ended
September 30, 2010 as compared to $3,472,000 for the three months ended
September 30, 2009.
During the fiscal year ended September 30, 2010, we recognized a loss from
discontinued operations of $51,000 primarily associated with additional tax
expense of $42,000. During the three months ended September 30, 2009 we
recognized an additional loss on the sale of discontinued tire recycling
operations of $620,000 associated with recognition of additional income
taxes as we finalized all year end results.
Our net loss for the three months ended September 30, 2010 was $1,192,000
or $0.04 per basic share as compared to a net loss of $4,092,000 or $0.13
per basic share for the three months ended September 30, 2009.
Fiscal Year ended September 30, 2010 Compared to the Fiscal Year ended
September 30, 2009
Net sales from continuing operations for the fiscal year ended September
30, 2010 decreased $654,000 or 20 percent to $2,574,000 as compared to net
sales of $3,228,000 for the fiscal year ended September 30, 2009. The
decrease is primarily attributable to decreased playground tile and
equipment sales in the Midwestern and Western regions of the United States
due to a general economic slowdown during fiscal 2010. A majority of our
revenue is derived from specific one-time installations with minimal
follow-on revenue from the installed project, thus making annual revenue
comparisons particularly difficult. In addition, our new American Power
Group dual fuel subsidiary recorded $333,000 of revenue during the fiscal
year ended September 30, 2010 as compared to no revenue during the fiscal
year ended September 30, 2009.
During the fiscal year ended September 30, 2010 we incurred a negative
gross profit of $105,000 primarily due to the inclusion of $697,000 of
unabsorbed costs in excess of revenues associated with our dual fuel
subsidiary. Due to product mix changes and slightly lower production costs
during the year, our recycled rubber products operation had a gross profit
of $593,000 or 26 percent of net sales as compared to $723,000 or 22
percent of net sales for the fiscal year ended September 30, 2009.
Selling, general and administrative expenses for the fiscal year ended
September 30, 2010 increased $527,000 to $4,781,000 as compared to
$4,254,000 for the fiscal year ended September 30, 2009. The increase was
primarily attributable to the inclusion of $1,603,000 in costs associated
with increased sales and marketing initiatives for our American Power Group
subsidiary as well as increased professional expenses relating to business
development initiatives, which offset decreased performance based
incentives.
Expenses for internal research and development projects relating to the
introduction of new dual fuel products, enhancements made to the current
family of duel fuel products, and research and development overhead were
$699,000 for the fiscal year ended September 30, 2010. There were no
research and development expenses during the fiscal year ended September
30, 2009.
During fiscal 2008 and 2009, Green Tech Products incurred operating losses
of approximately $800,000 per year and had had negative cash flow from
operations. Green Tech also had stagnant revenue growth during in fiscal
2009. As a result of the losses and our annual evaluation of potential
goodwill impairment, management has determined the carrying value of Green
Tech Product's goodwill to be impaired and accordingly wrote-off all
goodwill, recording a non-cash impairment loss of $2,290,000 at September
30, 2009.
As a result of the foregoing, our loss from continuing operations after
income taxes decreased $302,000 to $5,790,000 for the fiscal year ended
September 30, 2010 as compared to $6,092,000 for the fiscal year ended
September 30, 2009.
During the fiscal year ended September 30, 2010, we recognized income from
discontinued operations of $149,000 primarily associated with a reduction
in tax expense of $134,000. During the fiscal year ended September 30,
2009, we recognized a gain on sale of discontinued operations net of income
taxes ($6.1 million), of $13,793,000 associated with the sale of our tire
recycling business in November 2008. The income from discontinued
operations of $290,000 for the fiscal year ended September 30, 2009 relates
primarily to the net results of our tire recycling operations, including
approximately $391,000 of one-time gains associated with the termination of
a long-term land and building lease agreement in Minnesota.
Our net loss for the fiscal year ended September 30, 2010 was $5,642,000 or
$0.17 per basic share as compared to net income $7,989,000 or $0.26 per
basic share for the fiscal year ended September 30, 2009.
Condensed Consolidated Statements of Operations
Three Months Ended Fiscal Year Ended
September 30, September 30,
2010 2009 2010 2009
------------ ------------ ------------ -----------
Net sales $ 1,577,000 $ 2,017,000 $ 2,574,000 $ 3,228,000
Cost of sales 1,284,000 1,697,000 2,679,000 2,705,000
------------ ------------ ------------ -----------
Gross profit 293,000 320,000 (105,000) 523,000
Selling, general and
administrative 1,161,000 1,449,000 4,781,000 4,254,000
Research and
development 238,000 -- 699,000 --
Impairment loss -
goodwill -- 2,290,000 -- 2,290,000
------------ ------------ ------------ -----------
1,399,000 3,739,000 5,480,000 6,544,000
------------ ------------ ------------ -----------
Operating (loss)
income from
continuing
operations (1,106,000) (3,419,000) (5,585,000) (6,021,000)
------------ ------------ ------------ -----------
Other income
(expense):
Interest and
financing income
(expense), net 25,000 (25,000) 23,000 (113,000)
Other, net (60,000) (28,000) (229,000) 42,000
------------ ------------ ------------ -----------
Other (expense),
net (35,000) (53,000) (206,000) (71,000)
------------ ------------ ------------ -----------
Loss from continuing
operations (1,141,000) (3,472,000) (5,791,000) (6,092,000)
Provision for income
taxes -- -- -- --
------------ ------------ ------------ -----------
Loss after income
taxes (1,141,000) (3,472,000) (5,791,000) (6,092,000)
Discontinued
operations:
(Loss) gain on
sale of
discontinued
operations -- (620,000) -- 13,793,000
(Loss) income from
discontinued
operations (51,000) -- 149,000 289,000
------------ ------------ ------------ -----------
(51,000) (620,000) 149,000 14,082,000
------------ ------------ ------------ -----------
Net loss $ (1,192,000) $ (4,092,000) $ (5,642,000) $ 7,990,000
============ ============ ============ ===========
Loss from continuing
operations per
share - basic $ (0.03) $ (0.11) $ (0.17) $ (0.19)
Loss from
discontinued
operations per
share - basic (0.01) (0.02) -- 0.45
------------ ------------ ------------ -----------
Net loss per share $ (0.04) $ (0.13) $ (0.17) $ 0.26
============ ============ ============ ===========
Weighted average
shares outstanding 33,163,000 31,506,000 33,111,000 31,506,000
------------ ------------ ------------ -----------
Condensed Consolidated Balance Sheet Data
September 30, September 30,
2010 2009
------------- -------------
Assets
Current assets $ 3,804,000 $ 9,218,000
Property, plant and equipment, net 975,000 872,000
Other assets 2,149,000 2,552,000
------------- -------------
$ 6,928,000 $ 12,642,000
============= =============
Liabilities and Stockholders' Equity
Current liabilities $ 2,768,000 $ 3,720,000
Notes payable, non-current 1,136,000 530,000
Obligations due under lease settlement 506,000 505,000
Stockholders' equity 2,518,000 7,887,000
------------- -------------
$ 6,928,000 $ 12,642,000
============= =============
About GreenMan Technologies
GreenMan Technologies, through its subsidiaries, provides technological
processes and unique marketing programs for alternative energy, renewable
fuels and innovative recycled products. The Company's alternative energy
subsidiary, American Power Group, Inc. (APG), provides a cost-effective
patented dual fuel technology for diesel engines. APG's dual fuel
alternative energy system is a unique external fuel delivery enhancement
system that converts existing diesel engines into more efficient and
environmentally friendly engines that have the flexibility to run on: 1)
diesel fuel and compressed natural gas ("CNG"); 2) diesel fuel and
bio-methane, or 3) 100% diesel fuel depending on the circumstances. The
proprietary technology seamlessly displaces up to 70% of the normal diesel
fuel consumption with CNG or bio-methane and the energized fuel balance
between the two fuels is maintained with a patented control system ensuring
the engines operate to Original Equipment Manufacturers' ("OEM") specified
temperatures and pressures with no loss of horsepower. Installation
requires no engine modification unlike the more expensive high-pressure
alternative fuel systems in the market. Our Green Tech Products, Inc.
subsidiary develops and markets branded products and services that provide
schools and other political subdivisions viable solutions for safety,
compliance, and accessibility including recycled surfacing. See additional
information at:
www.americanpowergroupinc.com and
www.playgroundcompliance.com
"Safe Harbor" Statement: Under the Private Securities Litigation Reform Act
With the exception of the historical information contained in this news
release, the matters described herein contain "forward-looking" statements
that involve risks and uncertainties that may individually or collectively
impact the matters herein described, including but not limited to the fact
that we have sold the tire recycling operations which have historically
generated substantially all our revenue and that we will be prohibited from
competing in that business on a regional basis until 2013; the risk that we
may not be able to increase the revenue or improve the operating results of
our Green Tech Products or American Power Group divisions; the risk that we
may not be able to return to sustained profitability; the risk that we may
not be able to secure additional funding necessary to grow our business, on
acceptable terms or at all; the risk that if we have to sell securities in
order to obtain financing, the rights of our current stockholders may be
adversely affected; the risk that we may not be able to increase the demand
for our products and services; the risk that we may not be able to
adequately protect our intellectual property; and risks of possible adverse
effects of economic, governmental, seasonal and/or other factors outside
the control of the Company, which are detailed from time to time in the
Company's SEC reports, including the Annual Report on Form 10-K for the
fiscal year ended September 30, 2010. The Company disclaims any intent or
obligation to update these "forward-looking" statements.
Contact Information: Contacts:
Chuck Coppa
CFO
Lyle Jensen
CEO
GreenMan Technologies
781-224-2411
www.greenman.biz
John Nesbett or Jennifer Belodeau
Institutional Marketing Services
203-972-9200