Satcon Technology Corporation saw the effects of the global recession on its total sales for the third quarter, as revenues went down by 37 percent, from $18.5 million in 2008 to $11.7 million.
The company’s gross margin – the ratio of each dollar of earnings maintained as gross profit – was only 1 percent in the third quarter ending October 3, a dismal decrease from the 19 percent in the same period in 2008.
Satcon reported an operating loss of $7.3 million, as compared with $3.3 million in 2008. Operating loss refers to the amount by which the cost of goods sold and the operating expenses is greater than the operating revenues.
Steve Rhoades, president and chief executive of Satcon, noted that the transition of the company’s manufacturing to China led to an increase in manufacturing costs. He said that these transition costs will continue into the fourth quarter, although he expects to complete the transition by yearend.
Despite the year-over-year decrease, revenues for the third quarter gained by 27 percent over the second quarter revenue of $9.2 million. Mr. Rhoades attributed this to the successful launch of some of the company’s utility-scale solar photovoltaic inverter solutions.
Some of the company’s operational highlights include the completion of the 9-megawatt First Light installation in Ontario Canada, which utilized the company’s 500-kilowatt PowerGate Plus inverters; an order for 5 MW of Satcom Prism for the 9-MW solar farm in Chicago, Illinois; and another delivery of 5 MW of Satcon Prism for CalRenew, the largest utility-scale photovoltaic solar facility in California.
Satcon also won a contract to supply 23 MW of its 500-kW PowerGate Plus inverters to a large Chinese reseller. This is the company’s largest single order to date and is scheduled for delivery in the fourth quarter.
With the increase in the company’s bookings in North America, Europe and China, which led to a current backlog of over $24 million, Mr. Rhoades foresees a strong fourth quarter for Satcon.
“The momentum of our business is steadily improving which is supported by the growing strength of the large scale solar market and the increasing demand for utility grade solar solutions,” he said.
He continued, “We continue to target reaching our first key financial milestone of cash generation on a run-rate basis as we exit 2009.”
Based in Boston, Massachusetts, Satcon has been delivering energy systems for solar photovoltaic, fuel cell, wind turbine and energy storage systems for over 24 years.
Satcon hit by crisis but aims to bounce back
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