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Orion Energy Systems, Inc. (OESX)
F2Q10 Earnings Call Transcript
October 27, 2009 5:30 pm ET
Victoria – Investor Relations
Neal Verfuerth – President and CEO
James R. Kackley – President and COO
Scott Jensen – CFO and Treasurer
Glenn Wortman – Sidoti & Company
Bill Nasgovitz – Heartland Funds
Brian Kramer – Roth Capital Partners
Eric Prouty – Canaccord Adams
Jeff Osborne – Thomas Weisel Partners
Good afternoon and welcome to the Orion Energy System’s second quarter 2010 conference call. (Operator instructions)
I’d will now turn the call over to Victoria. You may begin.
Previous Statements by OESX
» Orion Energy Systems, Inc. F3Q09 (Qtr End 12/31/08) Earnings Call Transcript
» Orion Energy Systems, Inc. F2Q09 (Qtr End 09/30/08) Earnings Call Transcript
» Orion Energy Systems, Inc. F1Q09 (Qtr End 06/30/08) Earnings Call Transcript
Before we begin, I will read the Safe Harbor Statement. Our remarks that follow, including answers to your questions, include statements that we believe to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are generally identified as such, because the context of such statements will include words such as believe, anticipate, expect, or words of similar importance. Similarly, statements that describe future plans, objectives, or goals are also forward-looking statements.
These forward-looking statements are subject to risks that could cause actual results to be materially different. Those risks include, among others, matters that we have described in our press release issued this afternoon and our filings with the SEC, except as described in these filings, we disclaim any obligations to update these forward-looking statements, which may not be updated until our next quarterly conference call.
Now, I'd like to turn the call over to Neal.
Thank you, Victoria. First, I'd like to welcome everyone to our Orion Energy Systems fiscal 2010 second quarter conference call.
Let me begin by discussing a few highlights from the quarter before moving to a more detailed discussion how Orion is positioned to take advantage of these trends.
As we reported earlier this afternoon, we exceeded our second quarter guidance reporting revenues of $14.6 million and a net loss of $0.06 per diluted share. Additionally, we realized positive operating cash flows from the Q210. I believe the sequential improving now results show signs of stabilization in the market and renewed optimism amongst our customers. We’re seeing them actually starting to free up some of these CapEx budgets that have been frozen for the last several quarters.
Going forward in our attempt to give our investor base a little more visibility into how we see things, we’re going to start reporting our bookings for the quarter.
Scott will provide a more complete definition of the bookings in his commentary, but I wanted to spend a few minutes setting the stage for how we measure our results.
Total bookings for the quarter were $20.3 million, including $2.4 million of our Orion virtual power plant supply agreement, which provide future reclaim revenue for up to five years. Given the increasing number of OVPP deals we are completing, we believe this number more effectively communicates how we measure our performance on a quarterly basis.
Let me quickly review a few highlights from the quarter. First of all, we signed a new major customer with a large facility footprint across North America. The significance of this was this was a customer that we talked in terms of the antiquated system right out of the shoot as opposed to looking at a phased approach for layering in our technologies. So the first POs from this customer included the modular high intensity fluorescent.
Second one of our national accounts, a global company, looking to utilize the best available technology in energy utilization and optimization invited Orion to participate in a competition, facilities in China and Chili. We are pleased to say that we demonstrated our leadership and our ability to deliver on the promise of energy saving without compromise and our technology was chosen as the vendor of choice for both of these projects.
We also gained traction selling our broader integrated system offering. I’m pleased to report that during the quarter we shipped more than 1,300 Apollo light pipes, which nearly doubled the amount of light pipes we’ve sold to date.
From a direct sales perspective, the national account business is starting to ramp up. Indications are that CapEx budgets are starting to loosen up and our contacts, many that are new to the organization or to the positions are engaging in conversations with respect to increasing their overall energy cost reductions.
Our team is ready to have that discussion armed with a better training and marketing materials that we developed over the last several quarters and many of our established customers that have not purchased anything in over a year are starting to send purchase orders in again.
We’re ready to deliver these products quickly. On the wholesale business side, contractors and partners are once again starting to bring in larger deals as their own customers increase spending as well.
This business is more readily saleable and historically been a higher margin business for us. As such, we continue to enhance the effectiveness through training programs at Orion University and teaching them to sell the Orion way.
Equally important, the general market trends are creating the perfect opportunity for Orion. In spite of a slowdown, ongoing concerns over secured low-cost energy, great reliability, emissions and environmental sustainability continue to beg for more energy efficient technology and solutions.