Maxwell Technologies Management Presents At Canaccord Genuity 32nd Annual Growth Conference (Transcript)

Maxwell Technologies Inc. (MXWL)

Canaccord Genuity 32nd Annual Growth Conference

August 14, 2012 9:30 AM ET


Kevin Royal – SVP, CFO, Treasurer and Secretary


Jed Dorsheimer – Canaccord Genuity


Jed Dorsheimer

I thank everybody for coming today. My name is Jed Dorsheimer. I’m one of the senior analysts at Canaccord Genuity running the lighting, display and energy storage sectors for the company. We’re lucky enough or fortunate today to have with us one of the leaders in ultra-cap technologies. For those unfamiliar with ultracaps, it’s basically a way to replace the battery for energy storage giving quick charges as well as increasing the lifetime. From a housekeeping perspective, we won’t have any Q&A in here. We’ll be moving across the hall to the breakout session. And I’m told to point you to our important disclosures concerning Canaccord Genuity may be found in our seminar materials.

So, with that, I’d like to introduce Kevin Royal, CFO of Maxwell Technologies, and also point out that Mike Sund, Head of IR, is handing out some pamphlets there. So, with that, I’d like to turn it over to Kevin.

Kevin Royal

Thank you, Jed. Before we get into the main body of the presentation, I need to go through our forward-looking-statement disclaimer, and just quickly what this says to summarize is that we will be making forward-looking statements today. Our actual future results could be different than the forward-looking statements that we make today and for more information you can take a look at our SEC filings. There we filed our Qs and Ks filed with the SEC.

So, first of all, a little bit about Maxwell. Today the company consists of three different product groups, ultracapacitors, our microelectronics product group and our high-voltage capacitors. And we’ll spend just a little bit of time on microelectronics and high-voltage. But the majority of this presentation will be focused on our growth area which is ultracapacitors.

So first, our high-voltage capacitors, these are very large devices that are used in power distribution and transmission applications. These are designed and manufactured by our wholly owned subsidiary in Rossens, Switzerland, and our revenues for 2011 were just a bit north of $42 million.

Our microelectronics product group, these are electronics components in single-board computers that are designed and built to withstand the harsh effects of space environments. So, they’re basically radiation-mitigated parts that allow them to withstand the radiation effects of flying in satellites and other space applications. This is a niche product, very profitable for the company, and our revenues in 2011 were $18 million for these products.

So, as I mentioned, ultracapacitors will be the focus of the presentation. This is the growth area for the company. Today, we’re in many applications and that list continues to grow. We’ll cover some of these applications a little bit later in the presentation. Our revenues for this product group in 2011 were $97 million.

So first, I’ll spend a little bit of time on talking about ultracapacitor and what an ultracapacitor does. And as Jed mentioned, an ultracapacitor is an energy storage device. It stores energy, and it’s capable of releasing that energy rapidly. So, it can take a quick charge and a quick discharge. They’re ideally suited for high-cycling, long-life applications such as regenerative braking in hybrid buses.

So, first, this chart is designed to show some of the differences in the operating characteristics of ultracapacitors and batteries. On the horizontal axis, we’ve got the power density and on the vertical axis, we’ve got the energy density, which is storage capacity. And what this chart demonstrates is that batteries have a much higher energy density or storage capacity in comparison to ultracapacitors, which have a much higher charge-discharge rate.

Some of the other characteristics to keep in mind about ultracapacitors and some of the key differentiators compared to other energy storage devices, is that they’ve got a wide operational temperature range. So, when we look at some of the applications, you’ll note that these are very extreme operating environments. They do good down to negative 40C degrees and can function as high as 65C degrees.

They’re very highly efficient. You can get out 95% of what you put in. They’ve got very, very long life, up to millions of cycles. They’re very lightweight. If you get a chance after the presentation, you can come try this. This is our K2 Cell, 1,200 farad, very light in comparison to other energy storage devices and there’s no heavy metals. These devices are comprised of aluminum and carbon with a little bit of electrolyte.

So, the previous chart, we talked about the differences between ultracapacitors and batteries. And what this chart does is it shows how the battery – how an ultracapacitor can complement a battery. Upper left-hand corner of the chart shows the current and the voltage on a battery in a forklift application.

So, you can see there’s a lot of spikes on the current and the voltage in normal operation. The lower right-hand corner shows that same application paired with an ultracapacitor. And you can see that the ultracapacitor, it handles the spikes in the current and the voltage. Batteries don’t like those spikes. So, paired with an ultracapacitor, a battery will last much longer.

So, these are our current ultracapacitor cells. So, these are the cells that we make. In the upper left-hand corner are our K2 cells, and they range from 650 farad to 3,000 farad. These are high-volume products.

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