AGM Statement & Trading Update

 

TIDMPTX TIDMPTXU 
 
RNS Number : 5467I 
Protonex Technology Corporation 
15 March 2010 
 

 
 
 
FOR IMMEDIATE RELEASE 
 
15 March 2010 
 
 
                    PROTONEX AGM Statement and trading update 
 
DATELINE: London, UK; Protonex Technology Corporation ("Protonex" or "the 
Company"), (AIM: PTX and PTXU), a leading provider of advanced fuel cell 
systems, announces that, at its Annual General Meeting to be held today at 10:00 
a.m., Scott Pearson, President and CEO, will make the following trading update: 
 
"With five months of the Company's 2010 financial year now complete, we are 
pleased to report excellent progress against the major objectives laid out in 
our 2009 Annual Report. In relation to our products, we are on target, with two 
products already launched at the beginning of the financial year and another two 
expected to be launched by the end.  On the government program front, the 
Company has announced a string of important contract wins that have contributed 
to a significant contract backlog which is expected to result in higher contract 
revenue for the financial year ending 30 September 2010 than for any previous 
year.  Finally, on the partnership front, Protonex has advanced its strategic 
relationships with several global OEMs including Cummins and Lockheed Martin and 
has entered into detailed discussions with several other market-leading 
companies. 
 
PRODUCT LAUNCHES 
 
"The Company's hand-held power management devices, the SPM and BPM power 
managers, were launched into the military market at the beginning of the current 
financial year and have been shipping in evaluation quantities to the US 
Military. The Company is targeting to sell between 100 and 200 evaluation units 
in its financial year 2010 and will be positioning these products for higher 
volume orders and initial deployment in 2011. 
 
"The Company's M250-B consumer product remains on track for launch in the middle 
of the second quarter of the 2010 calendar year, primarily into the recreational 
vehicle (RV) market but with subsequent entry into the marine auxiliary power 
segment.  Five RV beta sites have been installed over the past few months and 
all continue to perform well.  The acquired field data has been valuable and the 
Company is learning a great deal about the M250-B system and its fit into a 
variety of RVs.  Low volume sales of the M250-B product are expected in the 
current financial year and are expected to set the foundation for a meaningful 
increase in sales during 2011. 
 
"Development of the next-generation of the M250-CX product has recently been 
funded by the U.S. Army with "first unit" deliveries expected by June/July of 
this year followed immediately by a low volume product delivery of 30 units. 
The next-generation improvements delivered during the program will include 
increased power output, further integrated battery charging capabilities, 
additional ruggedisation and a reduction in overall weight and size.  The total 
value of this next generation M250-CX effort amounts to $3.34 million and brings 
the total US Government investment in the Protonex M250-CX platform to $11 
million. 
 
PROGRAMS 
 
"As expected, government program awards to Protonex have been robust in the 
second half of 2009 and to date in 2010.  Consequently, the Company's current 
backlog and 2010 program revenue opportunities are both strong and consistent 
with internal expectations.  Whilst the Company does not offer guidance around 
possible future contract awards, listed below are the Protonex program awards 
that comprise material portions of the Company's 2010 program revenues: 
-     $3.34 million from the US Army to engineer the next-generation version of 
the M250-CX power system and to deliver a total of 33 units (Jan/Feb 2010) 
-     Up to $1.0 million to build, test, and deliver solid oxide fuel cell 
systems for the US Army in conjunction with the University of South Carolina 
(Nov 2009) 
-     $2.0 million and $1.5 million from the US Army to build, test, and deliver 
solid oxide fuel cell systems operating on high-performance liquid fuels (Sep 
2009, Jan 2009) 
-     $1.44 million in additional funding from the US Navy and Air Force to 
extend capabilities of high performance UAV power (Jun 2009, Sep 2009) 
-     Up to $3.3 million ($2.2 million base award with a $1.1 million option) 
from the US Department of Defense (DoD) for a high-performance power system for 
the AECV UAV platform (Mar 2009) 
 
"The previously announced Protonex AECV UAV program with the US DoD is currently 
being modified.  In February 2010, the US DoD and several other parties, 
including Protonex, determined that having the overall AECV airplane 
manufacturer assume the role of prime contractor on the fuel cell integration 
effort would be desirable. The Company believes that this is a significant 
benefit to it as the prime contractor will handle the customer directly and more 
effectively support the plane and propulsion system in the field.  Consequently, 
Protonex and the DoD decided to stop the original Protonex contract in February 
2010 (after $1.7 million of payments to Protonex) and have begun to negotiate a 
new set of contracts between the DoD, the UAV prime contractor and Protonex. 
The Company's current expectations are that it will receive a subcontract from 
the AECV manufacturer under this new arrangement that will significantly exceed 
the $0.5 million balance of the base award. 
 
PARTNERS 
 
"Protonex continues to develop important strategic relationships with a set of 
market-leading corporate partners.  Its existing partnership with Cummins is 
working well and discussions are underway on how to expand the operating 
relationship.  In the near term, Cummins will be supporting the M250-B launch as 
well as certain emerging SOFC products and technologies. 
 
"As previously announced, Protonex was recently selected by Lockheed Martin to 
develop power supply concepts that will enable its HULCTM robotic exoskeleton to 
support extended missions.  In addition to the HULC project currently underway, 
the Company is in discussions with Lockheed Martin on several other joint 
technology and product development opportunities. 
 
"There are many other discussions underway with potential military and 
non-military OEMs and industrial partners.  On the military side, the Company is 
in detailed discussions with three major military prime contractors to 
incorporate Protonex' technology and products into existing UAV systems.  The 
Company expects one or more of these agreements to be signed in the coming 
months.  On the non-military side, Protonex is selectively pursuing early 
product discussions with a focused set of non-military OEMs in the RV, Marine, 
Backup, and Auxiliary Power markets. 
 
FINANCIAL 
 
"As Protonex approaches the halfway point of its 2010 financial year, the 
Directors are pleased to report that the Company's financial performance has 
been generally in line with, or slightly ahead of, internal expectations.  To 
date, program revenues have developed well and expenses are being carefully 
managed to achieve bottom line results.  Looking forward, the Company is 
targeting between 10% and 20% of revenues in the current financial year to be 
contributed from product sales to both military and non-military customers. 
Much of this product revenue will be driven in the second half of the Company's 
financial year. 
 
"Finally, as previously communicated, the Company is planning to raise 
additional capital in 2010 and has started this process. 
 
SUMMARY 
 
"In summary, the Company's core business strategy remains unchanged and its 
execution during the first half of its financial year to 30 September 2010 is on 
track.  In this pivotal year, the Company expects four product launches to occur 
resulting in low volume orders and initial product revenues.  The Directors of 
Protonex are pleased with the Company's progress to date during the current 
financial year and remain confident in the Company's growth prospects in 2010 
and beyond." 
 
 
                                    - ENDS - 
 
Enquiries 
Protonex Technology Corporation                                           Tel: 
[phone] 
Scott Pearson, Chief Executive Officer 
John Connolly, Chief Financial Officer 
 
Redleaf Communications Limited                                           Tel: 
[phone] 
Press and Investor Relations 
  [e-mail] 
Paul Dulieu 
 
Piper Jaffray Ltd.  Tel: [phone] 
Nominated Adviser 
Jens Rosebrock 
Rupert Winckler 
 
 
Notes to Editors 
 
About Protonex Technology Corporation 
www.protonex.com 
Protonex Technology Corporation develops and manufactures compact, lightweight 
and high- performance fuel cell systems for portable power applications in the 
100 to 1000-watt range. The Company's fuel cell systems are designed to meet the 
needs of military, commercial and consumer customers for off-grid applications 
underserved by existing technologies by providing customizable, stand-alone 
portable power solutions and systems that may be hybridized with existing power 
technologies. The Company is headquartered in Southborough, Massachusetts. 
 
 
This announcement includes statements which are, or may be deemed to be, 
"forward-looking statements". All statements other than statements of historical 
facts included in this announcement, including, without limitation, those 
regarding Protonex' financial position, business strategy, plans and objectives 
of management for future operations (including development plans and objectives 
relating to Protonex' products and services) are forward-looking statements. By 
their nature, such forward-looking statements involve known and unknown risks, 
uncertainties and other important factors that could cause the actual results, 
performance or achievements of Protonex to be materially different from future 
results, performance or achievements expressed or implied by such 
forward-looking statements. These factors include but are not limited to those 
described in the Admission Document issued in connection with the Company's 
admission to AIM. 
 
Forward-looking statements may and often do differ materially from actual 
results.  Any forward-looking statements in this announcement speak only as at 
the date of this announcement and are subject to risks relating to future events 
and other risks, uncertainties and assumptions relation to Protonex' operations, 
results of operations, growth strategy and liquidity. 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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