The forward-looking statement in this discussion are only as of date hereof and the Company assumes no duty or obligation to update or revise any forward-looking statements contained in this discussion.As a reminder this call is being recorded for replay purposes. I would now like to hand call over to your host for today, Mr. Chris Hutter, Chief Financial Officer. Please proceed, sir. Chris Hutter Thank you and welcome everyone to the PowerSecure first quarter 2010 earnings conference call. We appreciate you taking the time and your interest in our Company. With me today I have Sidney Hinton, our Chief Executive Officer. And our agenda will very similar to what we usually do in that Sidney will provide an overview of our first quarter results and then lead a strategic business discussion and work his way through the business units. I will then provide more detail on our first quarter operating results, balance sheet, and our backlog as well as talk about the other two releases that we besides the press release that we announced today. We’ll then open up the lines for Q&A and then Sidney will wrap up with a few closing remarks. And with that, I’ll turn it to Sidney. Sidney Hinton Thanks, Chris. Good afternoon, everybody. Before we get started, I would just like to acknowledge our utility partners who are listening in as well as our large customers who are listening in. We appreciate your support and interest in us and also acknowledge our investors. We appreciate your support and interest as well. The format today’s call will be the same as what we usually do. I am going to cover three basic items. I am going to cover the five key messages. I am going to summarize that again at the end of my part of this and then – and after that and before the summary at the end I am going to talk about the financial – the highlights of the financial results for Q1 and then I am going to go through each of our strategic business areas, all four of them, and give you a strategic update on those units.
Let’s start then. The five key messages that we want you to walk away from today’s call areone, we couldn’t be more pleased with the first quarter, getting 2010 off to a strong start, both on top line and bottom line results. The major highlights included; our revenues were up 25% over last year and then we achieved our all-time record high quarterly gross margin of 38.9%, delivering $0.07 earnings per share. Second Distributed Generation, our sales momentum has continued. Today, we announced another $15 million of new Distributed Generation and Utility Infrastructure business. This brings us to approximately $70 million of new business awards in the last six months and as result our backlog stands at a very robust $117 million. Third, these strong results and our continued sales momentum put us in a terrific position for 2010 and beyond. Additionally we continue to see encouraging signs that the economy is recovering and that our – and business investment is increasing. Fourth, we could have been more pleased with the strategic positions of each of our businesses in the marketplace. We think we’ve got a great hand to play, emphasize fourth one again, we like the hand we have, we are excited about it. Given our growing optimism and opportunities we are seeing in our pipeline, we made several strategic and operational decisions over the last few months to invest in our business and put us in a position to capitalize on the opportunities that we are seeing unfold in the marketplace. These investments include, and I am going to give you three items here, they include; one, making select additions to our team and equipment to support our new businesses; two, and I hope you listen to this and give us credit for not being complacent that we really are measuring ourselves against our own expectations versus looking backward and saying are we doing well compared to numbers. We are looking forward and saying are we positioned to deliver all that we can deliver out of this Company and with that being said and I say that we – our gross margin was 38.9%. Obviously we are operating very efficiently. But during this past quarter we made the decision to realign our sales and operations structures in several of our businesses and the goals were two-fold, one, we wanted to increase the productivity of our sales and two, we want to increase our operational effectiveness.
And in the third messages up under this is that we are investing, we are continuing to invest in our LED lighting opportunity. That includes the acquisition of IES we announced in April. It also includes the completion of the one-third minority purchase of EfficientLights that we announced today as well. Again, just going back, the message is we like our hand and we are continuing to make investment decisions. The three items that we point to that funded those investment decisions are, a), additions to our team, also some investments in some equipment, two, the realigning of our sales and our operations team, and, three, investing in our LED businesses and pursuing the growth there.Then the fifth message, and that is today we announced that we filed separate Shelf Registrations to facilitate these LED business investments and provide us with additional financial flexibility in the future. The S3 and S4 statements filed today facilitate the purchase of the one-third interest in our EfficientLights LED business and it sets us up to complete the purchase of the remaining one-third interest in our IES LED business in the future. We took the opportunity to file the statements and the amounts which we did, which also provide us with the ability to finance additional acquisitions or raise capital in the future. I want to be really clear in this point. And we are going to repeat this a number of times during the call. I want to hammer this home. While these filings do provide us with additional financial flexibility, we do not, again, we do not have any current plans to use the Shelf to raise capital or for acquisitions outside of the two LED businesses that we’ve invested in. Let me repeat, we do not have current plans to use the Shelf to raise capital or for acquisitions outside of the two LED businesses that we’ve already announced.
Additionally, we believe that one of our core strengths is our demonstratability to prudently manage and deploy capital effectively. So, one of the big reasons we made this decision today to file is that we believe that U.S. investors would recognize this and continue to trust our track record and our commitment to be disciplined in this areas. But we also want to be positioned if the market presents an opportunity for an acquisition that we were armed to be able to pursue that.Read the rest of this transcript for free on seekingalpha.com