ODYC Odyne Corporation (CE)

Odyne Corporation (OTCBB: ODYC), a leading developer of advanced Plug-In Hybrid Electric Vehicle (PHEV) Technology, today reported its Second Quarter 10-Q financial results and updated its financial and strategic outlook. Second Quarter Results Odyne Corporation reported in the company�s 10-Q filing with the Securities and Exchange Commission (SEC) that revenues for the second quarter 2008 were $258,374, 61% higher than the $160,640 reported in the first quarter of 2008. Delivery of parallel PHEV production systems, or �kits� increased to six kits in the second quarter from three kits in the first quarter of 2008. Cost of sales increased to $647,687 in the second quarter of 2008 from $329,158 in the first quarter of 2008. Approximately 30% of that increase, or $91,498, is attributed to costs associated with servicing long-term prototype projects, a business the company has previously announced it is de-emphasizing. Operating expenses for the three months ended June 30, 2008 were $1,075,508, a 5% reduction from the $1,130,983 booked in the first quarter ended March 31, 2008. On a year-over-year basis, second quarter 2008 revenues of $258,374 compared to $299,274 for the three months ended 2007, a decrease of $40,900 or 14%. Revenue for the three months ended June 30, 2008 was provided primarily by sales of PHEV production systems; there were no PHEV production systems delivered during the three months ended June 30, 2007. For the three months ended June 30, 2008 and 2007, revenue generated from long-term fixed price contracts was $2,312 and $299,274, respectively. The change in composition of our revenue reflects a shift in our emphasis from long-term prototype projects to the manufacture and delivery of production systems. Updated Financial and Strategic Outlook Looking to the second half of 2008, Alan Tannenbaum, Odyne�s CEO, continues to see strong demand for plug-in hybrid electric drive systems in the commercial market. �The energy and economic environment have heightened the awareness of our customers of the benefits of PHEV technology. Odyne, through its partner Dueco, Inc., has begun to deliver plug-in parallel hybrid systems to some of the largest utility companies in the U.S.� In order to continue to scale the delivery of kits to Dueco and others, the company has determined that it needs to expand significantly its testing & validation process, both internally and by third-party providers. �Our key objective is to insure that in addition to delivering fuel efficiency and lessening the environmental impact of the utility fleet, we are delivering on the reliability expectations of our customers,� said Mr. Tannenbaum.��Odyne intends to increase its commitment of human and financial resources to the testing and validation of its parallel kits. But until such time as we have furthered this process, Odyne does not expect to meet the production targets set out at the beginning of the year.� While the company has lowered its revenue and kit delivery expectations, it expects to see savings as a result of reducing the number of product lines in development. Going forward, Odyne will focus solely on its Parallel Hybrid Systems, which are less feature-rich than its Series Hybrid Systems. Parallel Hybrid Systems are produced by Odyne at a lower manufacturing cost than Series Hybrid systems, and their price point is significantly lower. �Demand for our products remains strong,� Mr. Tannenbaum noted, �yet price has become an increasingly important consideration for customers in the current economic environment.� Moreover, Odyne is committed to reducing its monthly cash burn rate in other areas. �As a result, despite our incremental investment in testing & validation of parallel systems, we still expect a lower cost structure for the company going forward,� said Mr. Tannenbaum. About Odyne Corporation Odyne Corporation is a clean technology company that develops and manufactures propulsion systems for advanced Plug-in Hybrid Electric Vehicles (PHEV), specifically for medium and heavy-duty trucks and buses. The company has developed a proprietary system combining electric power conversion, power control and energy storage technology, with standard electric motors, storage batteries and other off-the-shelf components that enable vehicles to have lower fuel, operating and maintenance costs with substantially lower emissions. Visit www.odyne.com for more information. Forward-Looking Statements This news release contains certain �forward-looking statements,� related to the business of Odyne which can be identified by the use of forward-looking terminology such as �believes,� �expects� or similar expressions. Such forward-looking statements involve known and unknown risks and uncertainties relating to product development and commercialization, regulatory actions or delays, the ability to obtain or maintain patent and other proprietary intellectual property protection, market acceptance, future capital requirements, competition in general and other factors that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected. Certain of these risks and uncertainties are or will be described in greater detail in our filings with the U.S. Securities and Exchange Commission. Odyne is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events, or otherwise.