Third Consecutive Quarter of Operating Profit
SpaceDev, Inc.
today reported its financial results for the third
quarter ending September 30, 2004.
During the third quarter, we made great strides in strengthening
our balance sheet through a preferred stock offering and revolving
credit facility debt conversions as we simultaneously added to and
expanded on our existing contract base,” said Richard B. Slansky,
chief financial officer of SpaceDev. “These achievements resulted in
our seventh consecutive quarter of revenue growth and fourth
consecutive quarter of positive cash flow, and we expect these
successes will continue to contribute to sequential increases in
revenue in the coming quarters.”
For the three-months ending September 30, 2004, revenue increased
approximately 60% to $1,230,126, compared to $767,780 for the same
period in 2003 primarily due to the addition and expansion of our
contracts with the Air Force Research Laboratory and the Missile
Defense Agency, which created new revenue. For the nine-months ending
September 30, 2004, revenue increased approximately 67% to $3,445,569
as compared to net sales of approximately $2,054,576 for the same
nine-month period in 2003.
Profit from operations was $48,766 for the third quarter of 2004,
compared to a loss from operations of $150,045 for the third quarter
in 2003. Profit from operations for the nine-months ended September
30, 2004 was $93,550 compared to a loss of $878,381 for the comparable
period in 2003.
During the nine-month period ending September 30, 2004, EBITDA
increased to $148,787 or 4.3% of net sales, compared to an EBITDA loss
of $725,358 or 35.3% of net sales, for the nine-month period ending
September 30, 2003. EBITDA is defined as non-GAAP earnings before net
interest income (expense), taxes, depreciation and amortization.
The net loss for the three-months ending September 30, 2004 was
$602,888, or $0.03 per share, compared to a net loss of $208,261, or
$0.01 per share, for the comparable period in 2003 and a net loss of
$1,286,866, or $0.07 per share, for the second quarter of 2004. The
net losses were primarily due to non-cash interest expense, which was
$663,481 in the third quarter, and other fees related to the Company’s
revolving credit facility with the Laurus Master Fund. Non-cash
interest expense is not included in the calculation of profit from
operations. The Company is working to significantly reduce or
eliminate its non-cash charges in 2005 and beyond.
Net cash increased to $4,078,593 at September 30, 2004, an
increase of $3,764,364 from $314,229 at September 30, 2003. The
increase in net cash is primarily due to the Company’s recent
preferred stock financing agreement, conversions under the Company’s
revolving credit facility, exercises of warrants issued under previous
financings and exercises of stock options under the Company’s 1999
Stock Option Plan. The working capital ratio increased to 6.24 in the
third quarter from 0.45 in the same period last year. Furthermore, the
financing combined with the conversions and exercises resulted in a
positive stockholder’s equity of $3,076,348 at September 30, 2004 from
a deficit of $2,274,414 at September 30, 2003.
“The third quarter was marked by a series of substantial
achievements across our all of our technology platforms as we
continued to revolutionize the space industry,” said Jim Benson,
SpaceDev’s founding chairman and chief executive officer. “Our
innovative, safe rocket motor technology helped power SpaceShipOne to
a $10 million Ansari X-Prize victory. We also began preliminary
designs of the SpaceDev DreamChaser(TM), a re-useable, piloted,
sub-orbital spaceship, and we have expanded our development of high
performance nano- and micro-satellites being developed for the Air
Force, MDA, and DARPA.”
Third Quarter Conference Call Details
SpaceDev will host a conference call later today at 11:00 a.m. EST
to discuss the third quarter results. All those interested in hearing
management’s discussion are invited to join the call by dialing
1-800-946-0774. International participants may access the call by
dialing 1-719-457-2648. Participants may also access a live webcast of
the conference call through the Investor Relations section of
SpaceDev’s web site, www.spacedev.com. A replay of the webcast will be
available for 90 days.
For more information regarding the Company, please review the
Company’s filings on the SEC EDGAR system at www.sec.gov or at
www.spacedev.com.
Non-GAAP Financial Measures
This release contains disclosure of EBITDA, which is a non-GAAP
financial measure within the meaning of Regulation G promulgated by
the Securities and Exchange Commission. The EBITDA presented above,
while considered the most common definition used by investors and
financial analysts, may not be comparable to similarly titled measures
reported by other companies. The Company believes that EBITDA, while
providing useful information, should not be considered in isolation or
as an alternative to other financial measures determined under GAAP,
such as net income or loss (as an indicator of operating performance)
or cash flow (as measure of liquidity).
About SpaceDev
SpaceDev creates and sells affordable and innovative
space products and solutions to government and commercial enterprises.
SpaceDev’s innovations include the design, manufacture, marketing and
operation of sophisticated micro- and nano- satellites, hybrid
rocket-based orbital Maneuvering and orbital Transfer Vehicles (MoTVs)
as well as sub-orbital and orbital hybrid rocket-based propulsion
systems for safe human space flight. For more information, visit
www.spacedev.com.
This news release may contain forward-looking statements
concerning the Company’s business and future prospects and other
similar statements that do not concern matters of historical fact.
Forward-looking statements relating to product development, business
prospects and development of a commercial market for technological
advances are based on the Company’s current expectations. The
Company’s current expectations are subject to all of the uncertainties
and risks customarily associated with developing business ventures
including, but not limited to, risks associated with new product
development and availability of raw resources and suppliers, risks to
marketed products and availability of financing and other sources of
income, as well as risks discussed in the Company’s periodic reports
filed with the U.S. Securities & Exchange Commission. The Company’s
actual results may differ materially from current expectations.
Readers are cautioned not to put undue reliance on forward-looking
statements contained in this release and to read it in conjunction
with the Company’s annual report on Form 10-KSB, including the
consolidated financial statements filed therewith. The Company
disclaims any intent or obligation to update publicly these
forward-looking statements, whether as a result of new information,
future events or for any other reason.
SpaceDev, Inc. and Subsidiary
Consolidated Balance Sheets
(Unaudited)
At September 30, 2004 2003
----------------------------------------------------------------------
Assets
Current Assets
Cash $4,078,593 $314,229
Accounts receivable, net 427,358 297,037
Work in Progress 5,754 10,581
----------------------------------------------------------------------
Total current assets 4,511,705 621,847
Fixed Assets - Net 248,066 115,288
Other Assets 43,042 35,544
----------------------------------------------------------------------
$4,802,813 $772,679
The accompanying notes are an integral part of these consolidated
financial statements.
SpaceDev, Inc. and Subsidiary
Consolidated Balance Sheets
(Unaudited)
At September 30, 2004 2003
----------------------------------------------------------------------
Liabilities and Stockholders' Equity
(Deficit)
Current Liabilities
Current portion of notes payable $36,239 $44,654
Current portion of capitalized lease
obligations 3,943 19,804
Note payable - related party (Note
3(b)) - 80,000
Accounts payable and accrued expenses 161,980 349,464
Accrued payroll, vacation and related
taxes 210,434 116,725
Deferred revenue 49,779 -
Revolving credit facility (Note 3(c)) - 629,500
Other accrued liabilities 260,547 139,759
----------------------------------------------------------------------
Total current liabilities 722,922 1,379,906
Notes Payable, Less Current Maturities
(Note 3(a)) 18,797 55,012
Capitalized Lease Obligations, Less Current
Maturities 2,479 6,239
Note Payable - Related Party, Less Current
Maturities - 506,397
Deferred Gain - on Building Sale (Note 3(a)) 977,267 1,094,539
Deferred Revenue 5,000 5,000
----------------------------------------------------------------------
Total liabilities 1,726,465 3,047,093
Commitments and Contingencies
Stockholders' Equity (Deficit)
Preferred stock, Series C, $0.001
par value, 10,000,000 shares
authorized and 250,000 issued and
outstanding 250 -
Common stock, $0.0001 par value;
50,000,000 shares authorized, and
20,026,263 and 16,029,360 shares
issued and outstanding, respectively 2,002 1,602
Additional paid-in capital
(Note 3(c), 4 & 5) 16,724,176 8,921,791
Additional paid-in capital - stock
options 750,000 750,000
Deferred compensation (Note 5) (250,000) (250,000)
Accumulated deficit (14,150,080) (11,697,807)
----------------------------------------------------------------------
Total Stockholders' Equity (Deficit) 3,076,348 (2,274,414)
----------------------------------------------------------------------
$4,802,813 $772,679
The accompanying notes are an integral part of these consolidated
financial statements.
SpaceDev, Inc. and Subsidiary
Consolidated Statements of Operations
(Unaudited)
Three-Months Ending
Three and Nine Months Ending
September 30, 2004 and 2003 2004 % 2003 %
----------------------------------------------------------------------
Net Sales $1,230,126 100.0% $767,780 100.0%
Total Cost of Sales 952,944 77.5% 642,940 83.7%
Gross Margin 277,182 22.5% 124,840 16.3%
----------------------------------------------------------------------
Operating Expenses
Marketing and sales
expense 120,367 9.8% 112,321 14.6%
Research and development 4,522 0.4% 20,555 2.7%
Stock and stock option
based compensation - 0.0% 4,685 0.6%
General and administrative 103,527 8.4% 137,324 17.9%
----------------------------------------------------------------------
Total Operating Expenses 228,416 18.6% 274,885 35.8%
----------------------------------------------------------------------
Profit (Loss) from Operations 48,766 4.0% (150,045) -19.5%
----------------------------------------------------------------------
Non-Operating Expense
(Income)
Interest income (5,619) -0.5% - 0.0%
Interest expense 23,110 1.9% 30,056 3.9%
Non-cash interest expense
debt discount (Note 4) - 0.0% (88,408) -11.5%
Gain on Building Sale
(Note 3(a)) (29,318) -2.4% (29,318) -3.8%
Non-Cash Loan Fee - Equity
Conversions (Note 3(c)) 663,481 53.9% 148,412 19.3%
----------------------------------------------------------------------
Total Non-Operating Expense 651,654 53.0% 60,742 7.9%
----------------------------------------------------------------------
Loss Before Taxes (602,888) -49.0% (210,787) -27.5%
Income tax provision - 0.0% (2,526) -0.3%
Net Loss $(602,888) -49.0% $(208,261) -27.1%
----------------------------------------------------------------------
Net Loss Per Share:
Net loss $(0.03) ($0.01)
----------------------------------------------------------------------
Weighted-Average Shares
Outstanding 19,228,019 15,525,203
Nine-Months Ending
Three and Nine Months Ending
September 30, 2004 and 2003 2004 % 2003 %
----------------------------------------------------------------------
Net Sales $3,445,569 100.0% $2,054,576 100.0%
Total Cost of Sales 2,702,583 78.4% 1,682,424 81.9%
Gross Margin 742,986 21.6% 372,152 18.1%
----------------------------------------------------------------------
Operating Expenses
Marketing and sales
expense 335,652 9.7% 311,368 15.2%
Research and development 39,326 1.1% 272,537 13.3%
Stock and stock option
based compensation - 0.0% 4,685 0.2%
General and
administrative 274,458 8.0% 661,943 32.2%
----------------------------------------------------------------------
Total Operating Expenses 649,436 18.8% 1,250,533 60.9%
----------------------------------------------------------------------
Profit (Loss) from
Operations 93,550 2.7% (878,381) -42.8%
----------------------------------------------------------------------
Non-Operating Expense
(Income)
Interest income (5,619) -0.2% - 0.0%
Interest expense 62,633 1.8% 64,683 3.1%
Non-cash interest
expense debt discount
(Note 4) - 0.0% 112,500 5.5%
Gain on Building Sale
(Note 3(a)) (87,954) -2.6% (78,181) -3.8%
Non-Cash Loan Fee -
Equity Conversions
(Note 3(c)) 2,456,794 71.3% 148,412 7.2%
----------------------------------------------------------------------
Total Non-Operating Expense 2,425,854 70.4% 247,414 12.0%
----------------------------------------------------------------------
Loss Before Taxes (2,332,304)-67.7% (1,125,795) -54.8%
Income tax provision - 0.0% - 0.0%
Net Loss $(2,332,304)-67.7%$(1,125,795) -54.8%
----------------------------------------------------------------------
Net Loss Per Share:
Net loss $(0.13) ($0.07)
----------------------------------------------------------------------
Weighted-Average
Shares Outstanding 18,019,886 15,408,961
The accompanying notes are an integral part of these consolidated
financial statements.
The following table reconciles EBITDA to net loss for the
three-months ending September 30, 2004 and 2003, respectively:
----------------------------------------------------------------------
For the three-months ending September September
30, 2004 30, 2003
(Unaudited) (Unaudited)
----------------------------------------------------------------------
Net Loss (Income) $(602,888) $(208,261)
----------------------------------------------------------------------
Interest Income (5,619) -
Interest Expense 23,110 30,056
Non-Cash Interest exp. (Debt Discount) - (88,408)
Gain on Building Sale (29,318) (29,318)
Loan Fee - Equity Conversion 663,481 148,412
Provision for income taxes - (2,526)
Depreciation and Amortization 22,749 46,822
----------------------------------------------------------------------
EBITDA $71,515 $(103,223)
----------------------------------------------------------------------
EBITDA should not be considered as an alternative to net income or
loss (as an indicator of operating performance) or as an alternative
to cash flow (as a measure of liquidity or ability to service debt
obligations). We believe that EBITDA provides an important additional
perspective on our operating results, our ability to service our
long-term obligations, our ability to fund continuing growth, and our
ability to continue as a going concern.
Contact:
SpaceDev, Inc.
Richard B. Slansky, 858-375-2030
richard.slansky@spacedev.com
or
The Investor Relations Group
Investor Contact:
Kathryn McNeil/John Nesbett/Dian Griesel, 212-825-3210
Michael Graff/Janet Vasquez, 212-825-3210
