Energy Conversion Devices (Nasdaq:ENER), a long-struggling supplier of flexible amorphous silicon (a-Si) photovoltaic laminates and building integrated photovoltaics (BIPV), dropped some bad news in its quarterly earnings call today.
Total revenue for the quarter was $21.5 million, a decrease of 70 percent over the third fiscal quarter of 2010, and a decrease of 69 percent over the previous quarter. The company attributed the downturn to "significant industry-wide disruptions in the company’s key European solar markets."
The company reported a net loss of $243.2 million, compared to a net loss of $385 million in the third fiscal quarter of 2010, which included a non-cash impairment charge of $358 million. Excluding impairment charges, the net loss in the third fiscal quarter of 2011 was $20.4 million.
As of March 31, 2011, the company had $172 million of cash, cash-equivalents, restricted cash and short-term investments.
The company said it is "implementing a strategic corporate restructuring that will include a reduction in its workforce of approximately 300 employees or 20 percent of the company’s current employees worldwide." The Board of Directors appointed Jay Knoll as Interim President, replacing former President and CEO Mark Morelli, who has resigned.
Third fiscal quarter solar product and system sales were $18.7 million, a decrease of 71 percent over the third fiscal quarter of 2010, and a decrease of 72 percent over the previous quarter. Consolidated gross margin was 16.3 percent, as compared to 2 percent in the year-ago quarter. During the quarter, ECD shipped 12 megawatts of its solar products and produced 26 megawatts. Total revenues plunged 70 percent to $21.5 million from $72.4 million.
Wendy Ventura, an ECD spokeswoman, said the company does not have an estimate yet for how many of the 300 layoffs will occur in Michigan. However, the majority of ECD’s 1,600 employees work in the state. The company has four plants in Auburn Hills and Greenville. It also operates a factory in Tijuana, Mexico that employs 750 workers, according to the Detroit Free Press.
ECD has had a long history of technological promise but money-losing quarters. Their low-efficiency amorphous silicon solar product, combined with high manufacturing costs amidst a highly competitive global market with rising efficiencies and plunging costs have put the firm into a tight spot.
The company's stock was down 9.7 percent to $1.58 per share.