Ocean Power Technologies, Inc (OPTT) Q3 2012 Earnings Call March 09, 2012 10:00 am ET Executives Brian M. Posner - Chief Financial Officer, Principal Accounting Officer, Secretary and Treasurer Charles Frederick Dunleavy - Chief Executive Officer and Director Analysts Jason Feldman - UBS Investment Bank, Research Division Robert W. Stone - Cowen and Company, LLC, Research Division Jeremy Hellman Presentation Operator
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I'll now turn the call over to Chuck Dunleavy, OPT's CEO.Charles Frederick Dunleavy Thank you, Brian, and thanks to everyone for being with us today. Brian and I will be available to answer questions following our prepared remarks. Turning to Slide 3. Let me briefly provide an update on recent accomplishments. We are very pleased with the results of the Ocean operations of our Littoral Expeditionary Autonomous PowerBuoy or LEAP unit developed for the U.S. Navy. The Autonomous PowerBuoy performed much better than the project specifications. At the same time, we have marked progress on advancing the PowerBuoy's energy conversion capability as part of our WavePort project in Spain, and are taking the steps to expedite development of our planned 19-megawatt project in Australia. With those projects, the PB150 project in Reedsport, Oregon and our ongoing business development efforts, we remain clearly focused on getting more PowerBuoys in the water. Our intellectual property position continues to strengthen as we optimize our PowerBuoy technology. Since our fiscal year began on May 1, 2011, we've been granted 4 patents and applied for 3 new patents covering a broad range of applications. From the new wave energy power take-off system to improved buoy mooring and anchoring, electrical efficiency innovations and patents on our Undersea Substation or Pod. In total, we have now 64 patents issued and pending. Quite impressive for a company of our size and really serves as witness to the creativity and technical innovation of our employees. Our operating loss for the fiscal third quarter and 9 months decline as compared to the comparable, prior year period. This primarily reflects a greater-than-30% decrease in product development costs for both the quarter and the 9-month periods. In addition, our net cash used in operations decreased for the 9-month period versus a year ago.
We ended the quarter with a backlog of nearly $8 million and cash on hand of approximately $38 million. We believe we are well-positioned for continued success with a number of exciting initiatives. Now let me go into more detail on some of our latest developments. Please turn to Slide 4. Early last month, we reported operating data, which we accumulated and analyzed in connection with the Ocean deployment of our LEAP autonomous PowerBuoy off New Jersey. This buoy, which is significantly smaller and more compact than our utility PowerBuoys, exceeded the project specification for payload power delivery during ocean operations last fall. The buoy was designed by OPT to provide persistent energy for the Navy's radar and communications payload, which called for continuous power of 150 watts. The actual results showed that the PowerBuoy supplied constant power in excess of 400 watts throughout the entire deployment period, and produced peak sustained electrical power of 1,500 watts. Such performance more than supported the 150 watt payload 24 hours a day 7 days a week for the duration of the ocean operations. In fact, the onboard power management and storage system allowed the payload to be operational even during extended periods of 0 wave activity. The PowerBuoy operated on a fully autonomous basis implementing the requisite power management and self protection functions without the need for human intervention.It's always maintained, even as the autonomous PowerBuoy withstood Hurricane Irene, which hit the New Jersey coastal on August 27, 2011, and had waves of up to 53 feet. These results demonstrate strong performance under our contract with the U.S. Navy for the maritime security mission. More broadly, the fact that we can offer the unique ability to supply persistent levels of power in deep ocean, during extended no-wave periods, represents an entirely new offering to satisfy offshore power needs for a multitude of applications. Read the rest of this transcript for free on seekingalpha.com