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8-K - FORM 8-K - AMERICAN SUPERCONDUCTOR CORP /DE/ | b87693e8vk.htm |
Exhibit 99.1
AMERICAN SUPERCONDUCTOR ANNOUNCES
WORKFORCE REDUCTION
WORKFORCE REDUCTION
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Efforts Undertaken to Offset Lowered Revenues | |
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Expected to Result in Annualized Cost Savings of $30 Million | |
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Company to Submit Plan to Regain Compliance with Nasdaq Listing Rules |
DEVENS, Mass., August 11, 2011 American Superconductor Corporation (NASDAQ: AMSC), a global
power technologies company, announced that it has reduced its global workforce by approximately 30
percent and its annualized expenses by approximately $30 million since March 31, 2011. These
reductions were made to better align costs with the companys revenue expectations, which have been
affected by business and contractual issues with AMSCs largest customer, Sinovel Wind Group Co.,
Ltd. AMSC expects to report a significant net loss on revenues of less than $10 million for the
fiscal quarter ended June 30, 2011.
As part of the action described above, the company announced today that it is eliminating 150
positions across the organization. Upon completion of the action, AMSC expects to employ nearly
600 people worldwide. AMSC expects to incur restructuring charges of $3 million to $4 million for
severance and related expenses in the quarter ended September 30, 2011.
These workforce reductions are necessary to maintain the health of the business in the wake of our
business and contractual issues with Sinovel, said AMSC President and Chief Executive Officer
Daniel McGahn. Expenses have been reduced in virtually all departments, levels and major
geographies, but we have focused on limiting the impact on customer-facing and research and
development functions, which are integral to our growth and diversification initiatives.
In addition, the company announced today that, by August 16, 2011, it plans to submit to the Nasdaq
Stock Market a plan to regain compliance with Nasdaq Stock Market listing rules. AMSC continues to
work on its restated financial statements for the fiscal quarters ended September 30, 2010 and
December 31, 2010, and its financial statements for the fiscal year ended March 31, 2011 and the
fiscal quarter ended June 30, 2011.
About American Superconductor (NASDAQ: AMSC)
AMSC offers an array of proprietary technologies and solutions spanning the electric power infrastructure from generation to delivery to end use. The company is a leader in renewable energy, providing proven, megawatt-scale wind turbine designs and electrical control systems. The company also offers a host of smart grid technologies for power grid operators that enhance the reliability, efficiency and capacity of the grid, and seamlessly integrate renewable energy sources into the power infrastructure. These include superconductor power cable systems, grid-level surge protectors and power electronics-based voltage stabilization systems. AMSCs technologies are protected by a broad and deep intellectual property portfolio consisting of hundreds of patents and licenses worldwide. More information is available at www.amsc.com.
AMSC offers an array of proprietary technologies and solutions spanning the electric power infrastructure from generation to delivery to end use. The company is a leader in renewable energy, providing proven, megawatt-scale wind turbine designs and electrical control systems. The company also offers a host of smart grid technologies for power grid operators that enhance the reliability, efficiency and capacity of the grid, and seamlessly integrate renewable energy sources into the power infrastructure. These include superconductor power cable systems, grid-level surge protectors and power electronics-based voltage stabilization systems. AMSCs technologies are protected by a broad and deep intellectual property portfolio consisting of hundreds of patents and licenses worldwide. More information is available at www.amsc.com.
AMSC Announces Workforce Reduction | Page 2 |
American Superconductor and design, Revolutionizing the Way the World Uses Electricity, AMSC,
Powered by AMSC, Amperium, D-VAR, dSVC, FaultBlocker, PowerModule, PowerPipelines, PQ-IVR, PQ-SVC,
SeaTitan, SolarTie, SuperGEAR and Windtec and design are trademarks or registered trademarks of
American Superconductor Corporation or its subsidiaries. All other brand names, product names or
trademarks belong to their respective holders.
Any statements in this release about future expectations, plans and prospects for the company,
including without limitation our expectations regarding results of operations for the quarterly
period ended June 30, 2011, charges for severance and related expenses, the filing of our audited
financial statements and Annual Report on Form 10-K for the fiscal year ended March 31, 2011, the
financial performance of the company and other statements containing the words believes,
anticipates, plans, expects, will and similar expressions, constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995. There are a
number of important factors that could materially impact the value of our common stock or cause
actual results to differ materially from those indicated by such forward-looking statements. Such
factors include: we may be subject to additional unanticipated accounting, audit and internal
control issues; we have a history of operating losses, and we may incur losses in the future; our
operating results may fluctuate significantly from quarter to quarter and may fall below
expectations in any particular fiscal quarter, including any expectations resulting from financial
guidance issued by us; a significant portion of our revenues have been derived from a single
customer, Sinovel, and any failure by this customer (or other customers) to honor contractual
obligations to accept products or to pay for products may have a material adverse impact on our
financial condition or results from operations; adverse changes in domestic and global economic
conditions could adversely affect our business; changes in exchange rates could adversely affect
our financial results; we may not realize all of the sales expected from our backlog of orders and
contracts; we rely upon third party suppliers for the components and subassemblies of many of our
products, making us vulnerable to supply shortages and price fluctuations; we may require
significant additional funding and may be unable to raise capital when needed, which could force us
to delay, reduce, or eliminate planned activities, including the planned acquisition of The Switch;
failure to complete the planned acquisition of The Switch could harm our operating results and
could cause our stock price to decline; completion of the planned acquisition of The Switch could
present certain risks to our business; we may acquire additional complementary businesses or
technologies that may require us to incur substantial costs for which we may never realize the
anticipated benefits; we have been named as a party to purported stockholder class actions and a
shareholder derivative complaints, and we may be named in additional litigation, all of which will
require significant management time and attention and result in significant legal expenses and may
result in an unfavorable outcome, which could have a material adverse effect on our business,
operating results and financial condition; our common stock has experienced, and may continue to
experience, significant market price and volume fluctuations, which may prevent our stockholders
from selling our common stock at a profit and could lead to additional costly litigation against us
that could further divert our managements attention; if we fail to implement our business
strategy, our financial performance could be harmed and our growth could slow or stop; our products
face intense competition, which could limit our ability to acquire or retain customers; our
international operations are subject to risks that we do not face in the United States, which could
have an adverse effect on our operating results; we depend on sales to China, and global conditions
could negatively affect our operating results or limit our ability to expand our operations outside
of China; changes in Chinas political, social, regulatory and eco
nomic environment may affect our
financial performance; problems with product quality or product performance may cause us to incur
warranty expenses and may damage our market reputation and prevent us from achieving increased
sales and market share; our success in addressing the wind energy market is dependent on the
manufacturers that license our designs; we have not manufactured our Amperium wire in commercial
quantities, and a failure to manufacture our Amperium wire in commercial quantities at acceptable
cost and quality levels would substantially limit our future revenue and profit potential; and our
patents may not provide meaningful protection for our technology, which could result in us losing
some or all of our market position. Reference is made to many of these factors and others in the
Risk Factors section of the companys most recent quarterly or annual report filed with the
Securities and Exchange Commission. In addition, any forward-looking statements included in this
release represent the companys expectations as of the date of this release. While the company
anticipates that subsequent events and developments may cause the companys views to change, the
company specifically disclaims any obligation to update these forward-looking statements. These
forward-looking statements should not be relied upon as representing the companys views as of any
date subsequent to the date of this release.
AMSC Announces Workforce Reduction | Page 3 |
AMSC Contact:
Jason Fredette
Phone: 978-842-3177
Email: jfredette@amsc.com
Phone: 978-842-3177
Email: jfredette@amsc.com