Wisconsin
|
001-33540
|
39-1987014
|
||
(State or other jurisdiction
of incorporation)
|
(Commission
file number)
|
(IRS Employer
Identification Number)
|
N93 W14475 Whittaker Way, Menomonee Falls, Wisconsin
|
|
53051 |
(Address of principal executive offices) |
|
(Zip Code)
|
Item | 2.02 Results of Operations and Financial Condition. |
Item | 9.01. | Financial Statements and Exhibits. |
Exhibit No.
|
Exhibit Description
|
99 | Press release, dated February 16, 2016, issued by EnSync, Inc., furnished herewith |
· | University of the Nations: Phase I is complete and supplying power to the University. Phase II will be complete by early March. |
· | Century West: The project is on schedule to be commissioned by May. |
· | OATI: The Agile Hybrid batteries have shipped and installation and commissioning will be complete by May. |
· | Cayman Islands: Our equipment has shipped to the Cayman Islands and the installation and commissioning will be complete by May. |
· | Production Release and Technology Transfer from EnSync to Meineng Energy: Fourteen Agile Flow Batteries were shipped from Meineng Energy to EnSync customers since the beginning of Q2. Thirteen Matrix Energy Management Systems have either been shipped from Meineng Energy to EnSync, or are in process of assembly and test in China. Meineng is now qualified to build and test our advanced Matrix systems and modules. |
· | Matrix ETL Listing to UL 1741: Our Matrix Energy Management platform is now listed by ETL to UL1741 specification. |
· | Hawaii "Smart Inverter" Compliance Achieved: Our inverters are among the first to achieve this designation. |
· | Installed Base Performance: The V3-Series Installed Base Upgrade Program is complete. All candidate systems have been upgraded, with significant improvement to performance. The program has been finished under budget. |
· | Hybrid Storage System Success: We achieved the milestone of 1.0MWh of Hybrid Flow-Li Ion batteries shipped for C&I / Microgrid applications less than a year from announcement. EnSync remains the premier supplier of hybridized commercial energy storage solutions. |
EnSync, Inc.
|
||||||||
Condensed Consolidated Balance Sheets
|
||||||||
(Unaudited)
|
||||||||
December 31, 2015
|
June 30, 2015
|
|||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
28,171,129
|
$
|
10,757,461
|
||||
Restricted cash on deposit
|
60,223
|
60,193
|
||||||
Accounts receivable, net
|
85,708
|
113,093
|
||||||
Inventories, net
|
2,673,598
|
1,198,117
|
||||||
Prepaid expenses and other current assets
|
596,498
|
441,537
|
||||||
Deferred financing costs
|
-
|
545,825
|
||||||
Customer intangible assets
|
154,875
|
-
|
||||||
Note receivable
|
165,156
|
159,107
|
||||||
Deferred project costs
|
159,978
|
-
|
||||||
Project assets
|
5,790,256
|
-
|
||||||
Total current assets
|
37,857,421
|
13,275,333
|
||||||
Long-term assets:
|
||||||||
Property, plant and equipment, net
|
3,794,418
|
4,164,912
|
||||||
Investment in investee company
|
2,339,931
|
2,408,528
|
||||||
Goodwill
|
803,079
|
803,079
|
||||||
Total assets
|
$
|
44,794,849
|
$
|
20,651,852
|
||||
Liabilities and Equity
|
||||||||
Current liabilities:
|
||||||||
Current maturities of bank loans and notes payable
|
$
|
328,744
|
$
|
324,626
|
||||
Accounts payable
|
1,411,045
|
1,056,744
|
||||||
Accrued expenses
|
415,291
|
1,129,166
|
||||||
Customer deposits
|
1,064,797
|
1,177,155
|
||||||
Accrued compensation and benefits
|
273,088
|
235,351
|
||||||
Total current liabilities
|
3,492,965
|
3,923,042
|
||||||
Long-term liabilities:
|
||||||||
Bank loans and notes payable, net of current maturities
|
888,451
|
1,053,581
|
||||||
Deferred revenue
|
13,290,000
|
-
|
||||||
Total liabilities
|
17,671,416
|
4,976,623
|
||||||
Commitments and contingencies (Note 15)
|
||||||||
Equity
|
||||||||
Series B redeemable convertible preferred stock ($0.01 par value,
|
||||||||
$1,000 face value) 3,000 shares authorized and issued, 2,300 and 2,575 shares outstanding, preference in liquidation of $5,172,385 and $5,635,866 as of December 31, 2015 and June 30, 2015, respectively
|
23
|
26
|
||||||
Series C convertible preferred stock ($0.01 par value, $1,000 face value),
|
||||||||
28,048 and 0 shares authorized, issued, and outstanding, preference in liquidation of $21,951,048 and $0 as of December 31, 2015 and June 30, 2015, respectively
|
280
|
-
|
||||||
Common stock ($0.01 par value); 300,000,000 and 150,000,000 authorized,
|
||||||||
47,608,821 and 39,129,334 shares issued and outstanding as of December 31, 2015 and June 30, 2015, respectively
|
1,184,403
|
1,099,608
|
||||||
Additional paid-in capital
|
136,775,596
|
117,104,936
|
||||||
Accumulated deficit
|
(110,877,163
|
)
|
(102,674,049
|
)
|
||||
Accumulated other comprehensive loss
|
(1,589,759
|
)
|
(1,589,486
|
)
|
||||
Total EnSync, Inc. equity
|
25,493,380
|
13,941,035
|
||||||
Noncontrolling interest
|
1,630,053
|
1,734,194
|
||||||
Total equity
|
27,123,433
|
15,675,229
|
||||||
Total liabilities and equity
|
$
|
44,794,849
|
$
|
20,651,852
|
||||
See accompanying notes to condensed consolidated financial statements.
|
EnSync, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
|
||||||||||||||||
Three months ended December 31,
|
Six months ended December 31,
|
|||||||||||||||
2015
|
2014
|
2015
|
2014
|
|||||||||||||
Revenues
|
||||||||||||||||
Product sales
|
$
|
335,694
|
$
|
114,177
|
$
|
486,230
|
$
|
663,518
|
||||||||
Engineering and development
|
46,567
|
186,477
|
169,007
|
201,997
|
||||||||||||
Total Revenues
|
382,261
|
300,654
|
655,237
|
865,515
|
||||||||||||
Costs and Expenses
|
||||||||||||||||
Cost of product sales
|
323,289
|
171,683
|
304,608
|
507,646
|
||||||||||||
Cost of engineering and development
|
82,020
|
59,982
|
136,167
|
169,145
|
||||||||||||
Advanced engineering and development
|
2,015,364
|
1,480,813
|
3,691,652
|
2,778,396
|
||||||||||||
Selling, general, and administrative
|
2,287,978
|
1,704,234
|
4,514,952
|
3,763,787
|
||||||||||||
Depreciation and amortization
|
181,066
|
159,174
|
359,656
|
313,690
|
||||||||||||
Total Costs and Expenses
|
4,889,717
|
3,575,886
|
9,007,035
|
7,532,664
|
||||||||||||
Loss from Operations
|
(4,507,456
|
)
|
(3,275,232
|
)
|
(8,351,798
|
)
|
(6,667,149
|
)
|
||||||||
Other Income (Expense)
|
||||||||||||||||
Equity in loss of investee company
|
(20,889
|
)
|
(225,471
|
)
|
(68,597
|
)
|
(307,973
|
)
|
||||||||
Gain on investment in investee company
|
-
|
-
|
-
|
1,257,407
|
||||||||||||
Interest income
|
14,094
|
7,879
|
18,710
|
11,490
|
||||||||||||
Interest expense
|
(12,517
|
)
|
(26,270
|
)
|
(27,647
|
)
|
(53,850
|
)
|
||||||||
Other income
|
-
|
-
|
76,437
|
-
|
||||||||||||
Total Other Income (Expense)
|
(19,312
|
)
|
(243,862
|
)
|
(1,097
|
)
|
907,074
|
|||||||||
Loss before benefit for Income Taxes
|
(4,526,768
|
)
|
(3,519,094
|
)
|
(8,352,895
|
)
|
(5,760,075
|
)
|
||||||||
Benefit for Income Taxes
|
(640
|
)
|
-
|
(640
|
)
|
-
|
||||||||||
Net loss
|
(4,526,128
|
)
|
(3,519,094
|
)
|
(8,352,255
|
)
|
(5,760,075
|
)
|
||||||||
Net loss attributable to noncontrolling interest
|
80,424
|
143,508
|
149,141
|
226,010
|
||||||||||||
Gain attributable to noncontrolling interest
|
-
|
-
|
-
|
(481,870
|
)
|
|||||||||||
Net Loss Attributable to EnSync, Inc.
|
(4,445,704
|
)
|
(3,375,586
|
)
|
(8,203,114
|
)
|
(6,015,935
|
)
|
||||||||
Preferred Stock Dividend
|
(70,058
|
)
|
(71,056
|
)
|
(146,580
|
)
|
(118,865
|
)
|
||||||||
Net Loss Attributable to Common Shareholders
|
$
|
(4,515,762
|
)
|
$
|
(3,446,642
|
)
|
$
|
(8,349,694
|
)
|
$
|
(6,134,800
|
)
|
||||
Net loss per share
|
||||||||||||||||
Basic and diluted
|
$
|
(0.10
|
)
|
$
|
(0.09
|
)
|
$
|
(0.18
|
)
|
$
|
(0.18
|
)
|
||||
Weighted average shares-basic and diluted
|
47,348,603
|
39,051,379
|
46,673,751
|
34,835,949
|
||||||||||||
See accompanying notes to condensed consolidated financial statements.
|
EnSync, Inc.
|
||||||||
Condensed Consolidated Statements of Cash Flows
|
||||||||
(Unaudited)
|
||||||||
Six months ended December 31,
|
||||||||
2015
|
2014
|
|||||||
Cash flows from operating activities
|
||||||||
Net loss
|
$
|
(8,352,255
|
)
|
$
|
(5,760,075
|
)
|
||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Depreciation of property, plant and equipment
|
345,209
|
313,690
|
||||||
Amortization of intangible asset
|
14,447
|
-
|
||||||
Stock-based compensation, net
|
463,539
|
853,811
|
||||||
Equity in loss of investee company
|
68,597
|
307,973
|
||||||
Gain on investment in investee company
|
-
|
(1,257,407
|
)
|
|||||
Interest accreted on note receivable
|
(6,049
|
)
|
(3,156
|
)
|
||||
Gain on bargain purchase
|
(76,437
|
)
|
-
|
|||||
Changes in assets and liabilities
|
||||||||
Accounts receivable
|
27,385
|
787,867
|
||||||
Inventories
|
(1,475,481
|
)
|
(98,328
|
)
|
||||
Prepaids and other current assets
|
(154,961
|
)
|
49,385
|
|||||
Refundable income taxes
|
-
|
10,908
|
||||||
Deferred project costs
|
(159,978
|
)
|
-
|
|||||
Project assets
|
(5,603,034
|
)
|
-
|
|||||
Accounts payable
|
354,301
|
(122,582
|
)
|
|||||
Accrued expenses
|
(731,570
|
)
|
(556,073
|
)
|
||||
Customer deposits
|
(112,358
|
)
|
(286,050
|
)
|
||||
Accrued compensation and benefits
|
37,737
|
33,610
|
||||||
Deferred revenue
|
13,290,000
|
-
|
||||||
Net cash used in operating activities
|
(2,070,908
|
)
|
(5,726,427
|
)
|
||||
Cash flows from investing activities
|
||||||||
Cash paid for business combination
|
(225,829
|
)
|
-
|
|||||
Change in restricted cash
|
(30
|
)
|
1,149
|
|||||
Expenditures for property and equipment
|
(10,416
|
)
|
(303,280
|
)
|
||||
Issuance of note receivable
|
-
|
(150,000
|
)
|
|||||
Net cash used in investing activities
|
(236,275
|
)
|
(452,131
|
)
|
||||
Cash flows from financing activities
|
||||||||
Payment of financing costs
|
(261,982
|
)
|
-
|
|||||
Repayments of bank loans and notes payable
|
(161,012
|
)
|
(173,982
|
)
|
||||
Proceeds from issuance of preferred stock
|
13,300,000
|
-
|
||||||
Proceeds from issuance of common stock
|
6,800,000
|
14,837,760
|
||||||
Common stock issuance costs
|
-
|
(1,148,023
|
)
|
|||||
Contributions of capital from noncontrolling interest
|
45,000
|
7,127
|
||||||
Net cash provided by financing activities
|
19,722,006
|
13,522,882
|
||||||
Effect of exchange rate changes on cash and cash equivalents
|
(1,155
|
)
|
5,340
|
|||||
Net increase in cash and cash equivalents
|
17,413,668
|
7,349,664
|
||||||
Cash and cash equivalents - beginning of period
|
10,757,461
|
10,360,721
|
||||||
Cash and cash equivalents - end of period
|
$
|
28,171,129
|
$
|
17,710,385
|
||||
Supplemental disclosures of cash flow information:
|
||||||||
Cash paid for interest
|
$
|
27,795
|
$
|
49,577
|
||||
See accompanying notes to condensed consolidated financial statements.
|
||||||||