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MANASSAS, VA, Aug. 29, 2011 /CNW/ --
- Five separate sales agreements totaling 34 Vindicator® units, the most
active in the Company's history -
MANASSAS, VA, Aug. 29, 2011 /CNW/ - Catch the Wind Ltd. (TSXV: CTW),
providers of laser-based wind sensor products and technology, today
reported its financial results for the three-and six-month periods
ended June 30, 2011. All figures are in U.S. dollars unless otherwise
stated.
"The second quarter of 2011 was the most active quarter for sales in our
history with the completion of five separate sales agreements totaling
34 Vindicator units; highlighted by our largest order to date, our
second licensing agreement, as well as the potential for substantial
follow on orders," said Phil Rogers, President and CEO of Catch the
Wind. "We look forward to further developing our operational
capabilities and supporting the production and manufacturing side of
the business. The completion of our CDN$15.1 million equity offering
subsequent to quarter-end provides us additional resources to start
building out our commercial operations, support our ongoing sales
effort, and continue the advancement of our revolutionary product."
Selected Q2 2011 Financial and Operational Highlights
-- Entered into an agreement for the sale of 20 Vindicator® LWS
units to TransAlta Corporation, Canada's largest independent
renewable energy provider, with an option to purchase
additional units. The sales agreement was the largest to date
for wind turbine control.
-- Entered into an agreement for the sale of six Vindicator® LWS
units to affiliated entities of Invenergy Wind LLC, a
developer, owner and operator of large-scale renewable and
other clean energy generation facilities in North America and
Europe, for installation in groups of two located at three
different Invenergy wind farms in the US.
-- Entered into an agreement for the sale of six Vindicator® LWS
units to Boralex (TSX: BLX), a power producer with an installed
capacity of 700 MW across North America and France, with the
option to purchase hundreds of additional units over a set
period.
-- Entered into an exclusive worldwide licensing agreement with
AXYS Technologies to integrate the Vindicator® LWS into an AXYS
system for land-based wind resource assessment applications.
AXYS will purchase a minimum of 58 high-precision Vindicator®
LWS units over the next five years.
-- Entered into an agreement for the sale of a Vindicator® LWS
unit to Kruger Energy Port Alma, a 44-turbine, 101.2 MW wind
farm in Ontario, Canada to be integrated to a SWT - 2.3 MW
turbine, expanding the number of turbine makes and models on
which Catch the Wind has installed turbine yaw control systems.
-- Entered into an agreement for the sale of a Vindicator® LWS
unit to the Illinois Institute of Technology, which was
subsequently installed on its GE 1.5 MW Test Turbine, operated
by an affiliate of Invenergy LLC.
Highlights Subsequent to Quarter-end
-- Completed an equity offering for aggregate proceeds of
approximately CDN$15.1 million.
-- Signed a letter of intent to enter into a collaborative
agreement with TechnoCentre éolien to install a Vindicator®
unit on one of its REpower MM92 2.05 MW turbines located in
Québec, which will validate the Vindicator® for use in cold
weather and harsh winter conditions, broadening potential
markets especially in Québec where over 3,000 MW of wind power
is expected to be installed over the next three to four years.
-- Leased, with an option to buy, a Vindicator® unit to a leading
manufacturer of wind turbines for up to six months, marking the
first lease agreement for a Vindicator® unit and creating a new
source of cash flow.
-- Announced the transitioning of Phil Rogers' role from CEO and
President of the Company to Special Advisor, commencing
December 31, 2011 or earlier if a suitable CEO candidate is
found prior to December 31, 2011.
-- Appointed Dr. Jo Major, Jr. as non-executive Chairman of the
Board of Directors.
Financial Performance
Catch the Wind did not recognize revenue for the quarter ended June 30,
2011 or for the comparable period in 2010. Catch the Wind generates
revenue from the sale and rental of its laser wind sensing products.
On a six-month basis, Catch the Wind generated $390,000 for 2011
compared to no revenue for the same period in 2010. The Company
operated as a development stage company from its inception until June
15, 2010, therefore, had not recognized any revenues or commenced its
principal commercial operations.
Operating expenses for Q2 2011 were $2.3 million, down 40.9% from $3.9
million for the corresponding period of last year. The approximately
$1.6 million net decrease in expenses is largely due to three factors:
an approximately $1.3 million aggregate decrease in inventory valuation
adjustment expense and an approximately $1.8 million increase in
non-cash gain related to the change in fair value of the Company's
warrant liability, which were partially offset by an approximately $1.7
million increase in research and development expense. It is important
to note that expenditures for research and development efforts, while
comparable on a period-to-period basis, are reflected differently in
the comparative financial statements due to the Company's transition
from a development stage company to a commercial enterprise in June
2010. Such R&D fees were capitalized in Q2 of 2010, whereas they were
recorded as a current period expense in Q2 2011.
For the six-month period of FY2011 operating expenses were $10.2
million, up 44.0% from $7.1 million for FY2010. The approximately $3.1
million increase in operating expenses is partially attributable to an
increase in research and development expense of $3.1 million due to
the capitalization of these engineering services related to the
development of the Company's products during the first six months of
2010 as opposed to recording them as a current period expense during
the first six months of 2011, offset in part by a $1.3 million decrease
in inventory valuation expense and a $0.7 million decrease in
professional engineering fees. Also contributing to the expense
variance was a $1.1 million increase in cost of sales (2010-NIL) and a
$0.9 million increase in the non-cash loss related to the change in
fair value of the Company's warrant liability.
Cost of sales for the quarter was $273,797. There was no cost of sales
for the corresponding quarter of 2010 as the Company was a development
stage enterprise at that time. On a six-month basis, cost of sales was
$1.1 million compared to nil for the same period in 2010.
Catch the Wind recorded a net loss for Q2 2011 of $2.3 million or $0.03
per share. These compare to a net loss of $3.9 million, or $0.07 per
share, for the same period of 2010. On a six-month basis, Catch the
Wind generated a net loss of $9.8 million or $0.12 per share compared
to a net loss of $7.1 million or $0.12 per share for the same period of
FY2010.
At June 30, 2011, Catch the Wind had a working capital deficit of $1.5
million, including cash and cash equivalents of $0.3 million, compared
to working capital of $6.9 million and cash and cash equivalents of
$6.8 million at December 31, 2010.
Catch the Wind has filed its financial statements for the three- and
six-month period ended June 30, 2011 and related Management's
Discussion and Analysis (MD&A) with securities regulatory authorities.
Catch the Wind's financial statements, MD&A and related documents are
available via SEDAR as well as through the Company's website, www.catchthewindinc.com.
Conference Call
Catch the Wind will host a conference call to discuss its Q2 2011
financial results on Wednesday, September 7, 2011 at 10:00 a.m. EST.
The delay between the conference call and the release of financial
results is due to scheduling conflicts with the senior management team.
To access the conference call by telephone, dial 647-427-7450 or
1-888-231-8191. Please connect approximately 15 minutes prior to the
beginning of the call to ensure participation. A question and answer
session for analysts and institutional investors will follow
management's presentation.
A live audio webcast of the conference call will be available at www.catchthewindinc.com . Please connect at least 15 minutes prior to the conference call to
ensure adequate time for any software download that may be required to
join the webcast. The webcast will be archived at the above web site
for 30 days.
A taped rebroadcast will be available to listeners until 12 a.m. ET on
Wednesday, September 14, 2011. To access the rebroadcast, please dial
416-849-0833 or 1-855-859-2056 and enter passcode 94203409, followed by
the number sign.
About Catch the Wind Ltd.
Catch the Wind Ltd. is a high-growth technology company headquartered in
Manassas, Virginia. The company was founded in 2008 to develop and
manufacture the Vindicator® laser wind sensor.
Catch the Wind serves the commercial market sector for laser based wind
sensor systems, recognized as the "gold standard" in wind measurement.
The company is focused on becoming a major contributor in making clean,
renewable wind energy more affordable and profitable. For more
information, visit www.catchthewindinc.com.
Forward-Looking Information
This news release includes certain forward-looking statements within the
meaning of Canadian securities laws. Forward-looking statements involve
risks, uncertainties and other factors that could cause actual results,
performance, prospects and opportunities to differ materially from
those expressed in such forward-looking statements. Forward-looking
statements in this news release, include, but are not limited to,
economic performance and future plans and objectives of Catch the Wind.
Any number of important factors could cause actual results to differ
materially from these forward-looking statements as well as future
results. Although Catch the Wind believes that the assumptions and
factors used in making the forward-looking statements are reasonable,
undue reliance should not be placed on these statements, which only
apply as of the date of this news release, and no assurance can be
given that such events will occur in the disclosed timeframes or at
all. Catch the Wind disclaims any intention or obligation to update or
revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
Catch the Wind Ltd.
Condensed Consolidated Interim Balance Sheets
(Unaudited)
June 30, December January 1,
31,
2011 2010 2010
(Note 5) (Note 5)
(Expressed in $ $ $
United States Note
dollars)
Assets
Current assets:
Cash and cash 4 322,043 6,746,467 10,616,065
equivalents
Accounts 416,719 202,157 119,627
receivable
Inventory 6 2,526,288 2,605,224 1,667,997
Prepaid 369,455 228,262 107,719
expenses and
other assets
3,634,505 9,782,110 12,511,408
Non-current
assets:
Property and 7 5,476,321 5,794,514 6,466,248
equipment
Intangible 8 5,313,324 5,990,404 5,923,105
assets
Other assets 81,109 81,109 77,045
10,870,754 11,866,027 12,466,398
Total assets 14,505,259 21,648,137 24,977,806
Liabilities and
Equity
Current
liabilities:
Accounts 3,326,334 2,043,448 1,339,905
payable and
other
liabilities
Warranty 13 37,500 31,250 -
provision
Due to related 16 1,129,788 74,388 355,685
party
Obligations 12 120,128 188,064 166,206
under finance
leases
Borrowings 17, 18 185,027 178,530 166,213
Deferred 376,200 333,500 360,000
revenue and
customer
deposits
5,174,977 2,849,180 2,388,009
Non-current
liabilities:
Obligations 12 11,967 41,467 212,934
under finance
leases
Warrant 10 848,003 596,117
liability
Borrowings 17, 18 4,121,361 4,215,527 4,394,057
4,981,331 4,853,111 4,606,991
Total 10,156,308 7,702,291 6,995,000
liabilities
Equity
Equity
attributable to
owners of the
Company:
Capital stock 9 8,049 8,049 5,488
Contributed 42,778,241 42,739,096 31,266,174
surplus
Deficit (38,525,649) (28,930,873) (13,481,028)
Non-controlling 88,310 129,574 192,172
interest
Total equity 4,348,951 13,945,846 17,982,806
Total 14,505,259 21,648,137 24,977,806
liabilities and
equity
Catch the Wind Ltd.
Condensed Consolidated Interim Statements of Loss and Comprehensive Loss
(Unaudited)
Three Three Six months Six months
months months ended ended
ended ended
June 30, June 30, June 30, June 30,
2011 2010 2011 2010
(Note 5) (Note 5)
(Expressed in $ $ $ $
United States Note
dollars)
Revenue - - 390,000 -
Expenses
Cost of sales 6, 273,797 - 1,056,704 -
16
Salaries and 429,718 646,785 1,082,027 1,432,323
benefits
General and 16 731,288 573,370 1,584,502 1,342,355
administrative
Inventory 6 (19,052) 1,277,461 7,948 1,331,838
writedown -
beta units
Amortization 8 338,540 59,540 677,080 63,280
of intangible
assets
Depreciation 7 159,019 166,546 318,116 332,287
of property
and equipment
Sales and 121,163 279,297 245,702 327,814
marketing
Consulting 236,593 168,119 403,851 279,109
fees
Professional 345,126 541,975 601,349 944,772
fees
Professional 16 191,995 551,840 480,731 1,195,441
engineering
fees
Research and 16 1,831,385 154,325 3,340,583 282,096
development
Finance costs 86,795 98,753 176,419 199,258
Interest (679) (6,871) (2,113) (13,692)
income
Other income, 17 (17,749) - (17,749) -
net
Loss (gain) on 10 (2,408,442) (625,055) 251,886 (625,055)
fair value of
warrant
liability
Foreign 205 4,165 7,075 3,493
exchange loss
2,299,702 3,890,250 10,214,111 7,095,319
Net loss and (2,299,702) (3,890,250) (9,824,111) (7,095,319)
total
comprehensive
loss
Net loss and total comprehensive
loss attributable to:
Owners of the (2,185,797) (3,810,277) (9,594,776) (6,933,264)
Company
(113,905) (79,973) (229,335) (162,055)
Non-controlling
interest
(2,299,702) (3,890,250) (9,824,111) (7,095,319)
Net loss per (0.03) (0.07) (0.12) (0.12)
share - basic
and diluted
Weighted average
number of common
shares
outstanding 80,491,919 56,940,807 80,491,919 55,918,071
To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/August2011/29/c7138.html
table border="0" valign="top" tr td Catch the Wind Ltd. /td td TMX Equicom /td /tr tr td Claudia Jaques /td td Philip Dale /td /tr tr td Vice President and General Counsel /td td Investor Relations /td /tr tr td 703-393-0754 /td td 416-815-0700 ext. 253 /td /tr tr td a href="mailto:cjaques@catchthewindinc.com"cjaques@catchthewindinc.com/a /td td a href="mailto:pdale@equicomgroup.com"pdale@equicomgroup.com/a /td /tr /table p /p