Enova Systems Inc. (AMEX:ENA)
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Enova Systems, Inc. (NYSE AMEX: ENA) (AIM: ENV) (AIM: ENVS) ("Enova" or
"the Company"), a leading developer of proprietary hybrid electric and
all-electric drive systems and drive system components for the emerging
green commercial vehicle market, announced its 2011 financial results on
Friday, March 30, 2012. The company reported revenues of $6.6M and gross
margins of 3.9%, despite a significant downturn in the overall electric
and hybrid market.
FINANCIAL HIGHLIGHTS:
-
Annual revenue was $6.6M in 2011, a decrease of 23% from $8.6M in 2010
and Q4 2011 revenue was $638,000, a decrease of $3.1M from $3.7M for
the same period in 2010. Customer orders decreased dramatically in the
second half of the year due to tightened government and school
district budgets, which resulted in a decrease in orders for our
customers’ vehicles.
-
Gross profit decreased to $0.3M in 2011 from $1.4M in 2010, and, in
Q4, we swung to a gross loss of $618,000 from gross profit of $751,000
in the same period in 2010. Margins decreased, in particular in the
second half of 2011, due to the lower sales base and our decision to
record an increase in the inventory valuation reserve at year end.
-
Overall, annual gross margin was 3.9% in 2011, down from 16.5% in 2010
and the gross margin in Q4 2011 decreased to a negative 97% compared
to a positive margin of 20% for the same period in 2010.
Enova President and CEO Mike Staran stated, “With many of our suppliers
and competitors facing insolvency and other crisis-type issues, we are
encouraged with the announced initiatives we have made in extremely
difficult market conditions. By remaining diligent in maturing what we
consider game-changers such as Green For Free™, we believe that we have
strengthened our position with our core customers, as well as begun to
establish better control over the distribution channels in our market
segment.”
Going Concern
Enova’s annual report on 10-K for 2011 filed with the SEC included an
audit opinion containing a going concern qualification. This
announcement is being made in compliance with Section 401(h) and Section
610(b) of the NYSE Amex Company Guide which require a NYSE Amex listed
issuer receiving an audit opinion with a going concern qualification to
make a public announcement to that effect.
2011 ACCOMPLISHMENTS:
Some highlights of our accomplishments in 2011 include:
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Green For Free™. In November 2011, Enova announced its
Green for Free™ Program, which is designed to allow fleet executives
to operate full 100% electric commercial vehicles (EVs) for similar
life cycle costs as those of diesel-powered commercial vehicles. The
anticipated savings fleets are expected to realize from the reduced
maintenance and fuel cost of electricity of the electric vehicles are
used over a period of time to cover the incremental expense for the
technology. Fleet vehicles targeted with the Green for Free™ Program
stand out as possessing unique characteristics that make them clear
beneficiaries of electric drive technology. With more than 16.3
million vehicles in operation, the nation’s fleets possess enough
capacity to drive initial ramp-up scale in the EV OEM supply chains.
We believe this is the first program that is engineered to eliminate
the overall incremental costs associated with buying and operating an
all-electric vehicle, making the Green for Free™ Program attractive to
fleets that are both large and small. Enova and FCCC anticipate
traction regarding this initiative,and expect to showcase further
details at multiple events in 2012, including the recent NTEA Work
Truck show and the upcoming EVS 26 conference, to be held in May at
the Los Angeles Convention Center.
-
Freightliner Custom Chassis Corporation (“FCCC”), a division
of Daimler Trucks North America. Enova and
FCCC began deploying new and retrofit all-electric vehicles to major
fleet customers in 2011. The resulting integration of our all-electric
drive system into the MT-45 chassis provides FCCC an all-electric
product offering: the FCCC MT-EV. The MT-EV (the FCCC model name)
chassis boasts a GVWR of 14,000 to 19,500 lbs. The durable steel
straight-rail chassis frame reduces flex and bowing to minimize stress
while carrying heavy payloads. The quiet operation of the all-electric
MT-EV also makes for an enjoyable driver experience. The MT-EV has a
flat-leaf spring front and rear suspension, allowing for a smooth,
solid ride that minimizes cargo shifts on uneven road surfaces. Enova
and FCCC also jointly announced intentions to deploy 3,000 vehicles
via the Green for Free™ Program (described above). FCCC has begun, in
early 2012, an aggressive campaign to exploit future EV sales by
showcasing the Enova/FCCC EV step van at numerous events on the West
Coast, as well as the recent NTEA Work Truck show in Indianapolis. We
currently are awaiting FCCC’s decision on battery selection for this
high volume initiative.
-
First Auto Works (“FAW”). Enova continues to
supply FAW drive systems for their hybrid buses. Since the 2008
Olympics in Beijing, Enova Systems and First Auto Works have deployed
nearly 500 vehicles, all utilizing Enova’s pre-transmission hybrid
drive system components. First Auto Works is one of China’s largest
vehicle producers, manufacturing in excess of 1,000,000 vehicles
annually. The Enova drive system is integrated and branded under the
name of Jiefang CA6120URH hybrid. The Jiefang 40 ft. long hybrid city
bus can carry up to 103 passengers and travel at speeds of over 50
miles per hour. With the Enova hybrid system components, the Jiefang
bus meets Euro III emission standards, consumes only 7.84 miles per
gallon, and achieves a reduction of 20 percent in harmful emissions.
Enova has recently shipped an already announced order of fifty (50)
systems in Q4 2011 and is working on additional incremental orders in
2012.
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U.S. General Services Administration (“GSA”).
GSA extended its contract with Enova as the exclusive supplier
contracted for the all-electric step van. GSA procures vehicles for
government agencies and the armed forces. Under this contract, Enova
will coordinate the supply of MT-EV all-electric walk-in step vans to
GSA under the Cargo Vans category. Enova continues to benefit from
federal fleet penetration via GSA with the Smith Newton product
offering in the Medium and Heavy Duty vehicle category.
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Remy Inc (“Remy”). Enova and Remy signed a long-term
electric motor supply agreement in March 2012. Under the five-year
agreement, Remy will provide its electric motors to Enova for its
all-electric drive systems. Remy motors feature the company's patented
High Voltage Hairpin (HVH) winding technology, which is claimed to
increase torque and power density for greater speed and range
in electric vehicles.
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Smith Electric Vehicles N.A. Inc. (“Smith”). Enova
continues to supply Smith with electric drive systems. Smith has
deployed several hundred vehicles utilizing Enova's electric drive
system. Smith most recently announced its intention to deploy vehicles
in the all-electric school bus sector. The 42-passenger Newton school
bus travels up to 100 miles on a single charge at speeds of up to 50
mph, and is intended for the fixed routes in urban areas most school
buses take each day.
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Optare plc (“Optare”). Optare awarded Enova a contract
as the production drive system supplier for their all electric buses.
Enova has shipped systems to Optare that are currently being
integrated into buses. Optare designs, manufactures and sells single
deck and double deck buses and mini coaches. It’s buses operate in the
UK, Continental Europe, and North America. Further, it has been
recently announced that commuters and bus passengers across England
will see more eco-friendly buses on the roads, congestion reduced, and
services upgraded, thanks to a new £101 million package of
improvements approved by Local Transport Minister Norman Baker. Five
bus manufacturers, including Optare, are expected to benefit from
orders for their eco-friendly hybrid, electric and gas buses.
Enova also maintains a visible presence in the forefront of a growing
industry with ongoing appearances and speaking engagements by company
executives at leading industry events such as Ardour Capital’s 9th
Annual Energy Technology Conference in September 2011, the recent NTEA
Work Truck show in Indianapolis, the upcoming EVS 26 conference at the
Los Angeles Convention Center and key US Military/Government conferences.
Throughout 2011, we finalized the development of our next generation
Omni power management and drive system component. We are also finalizing
design of a next generation on-board 10kW charger. Our various electric
and hybrid-electric drive systems, power management and power conversion
systems continue to be used in applications including Class 3-6 trucks,
transit buses, and heavy industrial vehicles. We also are continuing our
current research and development programs, as well as formulating new
programs with the U.S. government and other private sector companies for
electric and hybrid systems.
About Enova:
Enova Systems (http://www.enovasystems.com)
is a leading supplier of efficient, environmentally friendly digital
power components and systems products. The Company’s core competencies
are focused on the development and commercialization of power management
and conversion systems for mobile applications. Enova applies unique
‘enabling technologies’ in the areas of alternative energy propulsion
systems for light and heavy-duty vehicles as well as power conditioning
and management systems for distributed generation systems. The Company
develops, designs and produces non-invasive drive systems and related
components for electric, hybrid-electric, and fuel cell powered vehicles
in both the “new” and “retrofit” vehicle sales market. For further
information, contact Enova Systems directly, or visit its Web site at http://www.enovasystems.com.
ENOVA SYSTEMS, Inc.1560 West 190th StreetTorrance, CA 90501Tel:
310-527-2800Contact: John Micek, CFO/Investor Relations
Additional Information:
This news release contains forward-looking statements relating to Enova
Systems and its products that are intended to be covered by the safe
harbor for forward-looking statements provided by the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are statements
that are not historical facts. These statements can be identified by the
use of forward-looking terminology such as “believe,” “expect,” “may,”
“will,” “should,” “could,”“project,” “plan,” “seek,” “intend,” or
“anticipate,” or the negative thereof or comparable terminology and
statements about industry trends, and Enova’s future performance,
operations and products. These forward-looking statements are subject to
and qualified by certain risks and uncertainties. These and other risks
and uncertainties are detailed from time to time in Enova Systems’
periodic filings with the Securities and Exchange Commission, including
but not limited to Enova’s annual report on Form 10-K for the year ended
December 31, 2011.