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Maxwell Technologies Inc. Reports Operating Results (10-Q)

October 30, 2012 | About:
10qk

10qk

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Maxwell Technologies Inc. (MXWL) filed Quarterly Report for the period ended 2012-09-30.

Maxwell Technologies, Inc. has a market cap of $184.5 million; its shares were traded at around $6.32 with a P/E ratio of 17.6 and P/S ratio of 1.2.

Highlight of Business Operations:

Net income reported for the three months ended September 30, 2012 was $5.4 million, or $0.19 per diluted share, compared with $298,000, or $0.01 per diluted share, in the same quarter one year ago. While revenue growth for the three months ended September 30, 2012 compared with the same period of the prior year was more moderate than in recent annual periods at 7%, we were able to achieve an improved gross profit rate of 42%, compared with 40% in the same quarter of the prior year, and also reduced operating expenses, which were 28% of revenue in the current quarter, down from 37% in the same quarter of the prior year.

Net income reported for the nine months ended September 30, 2012 was $8.6 million, or $0.30 per diluted share, compared with a net loss of $723,000, or $0.03 per share, in the same quarter one year ago. During the nine months ended September 30, 2011, we recorded an accrual for the settlement of a legal matter of $2.4 million, and a gain on embedded derivatives and warrants of $1.1 million. During the nine months ended September 30, 2012, we continued to achieve improved operating results due to revenue growth combined with improvements in gross profit and operating margins.

Gross Profit. During the nine months ended September 30, 2012, gross profit increased $5.6 million or 12% compared with the same period one year ago. As a percentage of revenue, gross profit margin increased to 42% compared with 40% in the same period one year ago. Of the increase in gross profit in absolute dollars, $5.0 million related to an increase in the volume of sales and $2.0 million was due to net reductions of product costs for both our ultracapacitor and high voltage product lines. Offsetting this increase was a decrease in gross profit in absolute dollars of $1.3 million related to the impact of changes in foreign currency exchange rates, primarily changes between the Swiss Franc and the U.S. Dollar.

Selling, general and administrative expenses were 20% of revenue for the nine months ended September 30, 2012, down from 25% in the same period one year ago, and total expenses decreased $4.5 million, or 15%, from the same period one year ago. The decrease in absolute dollars was primarily attributable to a $2.6 million expense recorded in Q2 2011 related to the settlement of a legal matter, as well as a settlement gain of $667,000 recorded in Q1 2012. In addition, legal expenses decreased by $1.4 million due to the resolution of certain legal matters. Further, there was a decrease of $1.2 million in bonus expense, which was primarily due to the reversal of previously accrued bonus compensation related to the 2012 bonus program as the related financial targets will not likely be achieved, as well as no bonus expense having been recorded for the third quarter of 2012. Offsetting these decreases, advertising costs increased by $782,000, primarily related to the roll out of a new ultracapacitor product, the Engine Start Module, as well as increased participation in trade shows and other advertising media.

Research and development expenses were 13% of revenue for the nine months ended September 30, 2012, down from 15% in the same period one year ago, while total expenses decreased by $1.0 million, or 6%. The decrease in absolute dollars was primarily driven by a $413,000 decrease in bonus expense, which was primarily due to the reversal of previously accrued bonus compensation related to the 2012 bonus program as the related financial targets will not likely be achieved, as well as no bonus expense having been recorded for the third quarter of 2012. In addition, salary and contract labor costs decreased by $509,000 primarily related to higher contract labor costs incurred in 2011 for the design of the Engine Start Module.

Read the The complete Report

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