Titan Energy Worldwide Reports 1st Quarter Financials
June 23 2014 - 8:45AM
Marketwired
Titan Energy Worldwide Reports 1st Quarter Financials
MINNEAPOLIS, MN--(Marketwired - Jun 23, 2014) - Titan
Energy Worldwide, Inc. (OTCQB: TEWI), a leader in distributed power
generation products and intelligent energy management services,
today announced that it has released financial statements for the
1st quarter of 2014. The Company's complete financial
statements are available at www.sec.gov.
For the quarter ending March 31, 2014, the Company reports sales
revenues of $4,749,389, an increase of approximately 2% over the
same quarter last year. The Company has two main business
segments: equipment and service sales. Equipment sales were
$2,972,514, an increase of 6% over sales results in the same
quarter in 2013. Service sales were $1,776,875, down 4% from
2013. The loss in service sales was due primarily to the
extreme winter weather that the Midwest area experienced January
through March of 2014. Below zero temperatures limited the
number of hours Titan technicians could work for safety
reasons. This created a significant decrease in overall
sales.
The Company posted a loss of $679,211 for the quarter compared
to a loss of $279,559 in the same quarter of 2013. This is the
Company's first losing quarter since the first quarter of
2013. The loss in this quarter was attributed to the extreme
winter weather. Service costs increased significantly due to
missed work days, reduced hours to minimize technician exposure to
cold and the need to have multiple technicians on each job for
safety reasons. A second factor was the requirement to rebid a
contract with a major retail company in the first
quarter. During this rebidding process, Titan was required to
adopt new, reduced pricing measures before being able to
renegotiate its rates with its vendors. As a result, margins
on service work for this customer decreased significantly for a
period of about five months. Together, these factors reduced
service margins, leading to losses in net income.
"As with many companies, Titan's overall performance suffered
due to the extreme cold and winter weather this year. While the
weather created opportunities for us, as more customers needed
service on their onsite power systems, we had to balance our
service activities with safety concerns for our employees. As a
result, we had fewer work days, reduced work hours, and reduced
productivity of technicians -- all of which resulted in
significantly reduced margins and increased losses. The positive
side to this experience is that Titan has implemented new staffing
and dispatching procedures that we believe will help mitigate the
impact of a similar situation in the future," stated Jeffrey
Flannery, Chief Executive Officer of Titan Energy Worldwide.
"With regard to the rebidding on our national retail contract,
we were told that the retailer would no longer sign exclusive,
one-vendor contracts. Titan won back 80% of the service
contract, and we consider this a huge win for the Company, and a
strong indication of this customer's confidence in our
abilities. We were also awarded a preventive maintenance
agreement from this same customer worth nearly $800,000 per year
which more than makes up for the loss of territory. Once we
were formally awarded the new contact, we were then able to
renegotiate pricing with our vendors and are now seeing margins
equal to or stronger than in 2013.
"As for the future performance of Titan, there are a number of
very positive indicators. We have record equipment orders for
both our Midwest and New York operations which points to strong
future revenue months. Orders for Midwest are up 26% in the
first five months of 2014 compared to the first five months of
2013. For the New York operation, orders are up more than 50%
compared to 2013. We have a record level of service contacts
in the Midwest and are experiencing our highest levels of work load
in the Company's history. The value of service contracts in the New
York region is more than double the value of its 2013
contracts. I fully expect we will post another record year in
service sales.
"While we view the events of last winter as an aberration, we
know that weather can be extreme and unpredictable. We have
learned some valuable lessons from the winter of 2013-2014 which
have resulted in changes in how we manage our staff and resources
during times like that. So I feel we are now better prepared
to meet those challenges in the future and I do not believe we will
be impacted as severely should similar events happen in the
future," added Flannery.
About Titan Energy Worldwide, Inc. Since its founding, Titan
Energy Worldwide has been dedicated to helping companies meet their
power generation and energy management needs. To date we have
focused on providing thousands of customers with the most advanced
power generation equipment to enable their operations to continue
uninterrupted during times of power failures or disasters. We
have also established a professional service team that helps
customers to maintain and manage their power generations assets.
From emergency and backup power technologies, to demand response
programs and Smart Grid applications, Titan Energy is setting a
path for the future in energy management. For more information,
please visit the company's website at: www.titanenergy.com.
Forward-Looking Statements Investors are cautioned that certain
statements contained in this document as well as some statements in
periodic press releases and some oral statements of TEWI officials
are "Forward-Looking Statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 (the "Act").
Forward-looking statements include statements which are predictive
in nature, which depend upon or refer to future events or
conditions, which include words such as "believes," "anticipates,"
"intends," "plans," "expects," and similar expressions. In
addition, any statements concerning future financial performance
(including future revenues, earnings or growth rates), ongoing
business strategies or prospects, and possible future TEWI actions,
which may be provided by management, are also forward-looking
statements as defined by the Act. Forward-looking statements
involve known and unknown risks, uncertainties, and other factors
which may cause the actual results, performance or achievements of
the Company to materially differ from any future results,
performance, or achievements expressed or implied by such
forward-looking statements and to vary significantly from reporting
period to reporting period. Although management believes that the
assumptions made and expectations reflected in the forward-looking
statements are reasonable, there is no assurance that the
underlying assumptions will, in fact, prove to be correct or that
actual future results will not be different from the expectations
expressed in this report. These statements are not guarantees of
future performance and TEWI has no specific intention to update
these statements.
For more information about Titan Energy Worldwide please
contact: Jeffrey Flannery Titan Energy Worldwide, Inc. 952-960-2371
jflannery@titanenergy.com