Ocean Power Technologies, Inc (OPTT) Q4 2012 Earnings Call July 13, 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 George Santana - New Earth Capital Group 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, everyone, for being with us today. Brian and I will be available to answer questions following our prepared remarks. First, turning to Slide 3, let me provide an update on fiscal 2012 and other recent developments in a very productive time here at Ocean Power Technologies. As I'll discuss further in a moment, we just signed an agreement with Lockheed Martin to enhance our efforts to bring a large-scale wave power station to Australia that leverages a AUD 66.5 million grant, which we have received from the Commonwealth. This is very exciting, and we're gratified to have the support of a strong company such as Lockheed Martin behind the initiative. In addition, building on the successful completion of ocean testing of OPT's first utility-scale PB150 off Scotland, we recently completed testing of the company's new advanced power take-off system for our PB150 PowerBuoy in Oregon. We're also making progress towards deployment of that system. We continue to work on our WavePort project in Spain and are accelerating our business development efforts in the autonomous PowerBuoy market after the very successful operation of the U.S. Navy's Littoral Expeditionary Autonomous PowerBuoy. At the same time, we reduced our annual operating loss and our cash usage as well during fiscal 2012. Now, let me go into more detail on some of our latest developments. Turning to Slide 4. A very important milestone for OPT in fiscal year 2012 was 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's specification for payload power delivery during ocean operations last fall. Our partners for this effort included Rutgers University's Institute of Marine and Coastal Sciences, CODAR Ocean Sensors and Mikros Systems Corporation. The buoy was designed by OPT to provide persistent energy for the U.S. Navy's radar and communications payloads, which call 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 8 sustained electrical power of 1,500 watts. Such performance more than supported the payload 24 hours a day, 7 days a week for the duration of the ocean operation. In fact, the onboard power management 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 for self perfection functions without the need for human intervention. It's always maintained, even as the autonomous PowerBuoy withstood Hurricane Irene, which hit the New Jersey coastline on August 27, 2011, and had waves of up to 53 feet.
These results demonstrated strong performance under our contract with the U.S. Navy for their maritime security mission. More broadly, the fact that we can offer the unique ability to supply persistent levels of power in deep ocean, even during extended no-wave periods, represents an entirely new offering to satisfy offshore power needs for a multitude of applications. We're currently in active dialogue for other potential commercial applications of the autonomous PowerBuoy by the oil and gas industry as well as by oceanographic, data-gathering initiatives and desalination companies, all which could replace diesel generators that are costly, dirty and require frequent maintenance. We're placing more resources into developing these attractive end markets for our autonomous PowerBuoy.Read the rest of this transcript for free on seekingalpha.com