Applied Energetics Reports Third Quarter 2009 Financial Results

TUCSON, Ariz., Nov. 9 /PRNewswire-FirstCall/ -- Applied Energetics, Inc.,
(Nasdaq: AERG), today reported summary financial results for the third quarter
ended September 30, 2009. The Company will host a live conference call today,
November 9, 2009 at 11:30AM (Eastern Time).

Third Quarter Business Highlights

-- Awarded a $3.1 million Contract from the U.S. Army's Research,
Development and Engineering Command (U.S. Army RDECOM - Picatinny, NJ)
for the continued development and advancement of the company's Laser
Guided Energy(TM) (LGE) technology. The award is a cost plus fixed fee
Ordnance Technology Initiative Agreement with a ceiling value of $13.4
million over a period of performance of three years. The initial
funded
contract value is $3.1 million over a period of one year.

-- Received a $992,000, contract for the design, development and delivery
of an Ultra-Short Pulse (USP) laser system to the U.S. Navy. The
Company
will produce a demonstration system specifically designed to explore
USP
laser effects and determine requirements for deployment of USP lasers
on
U.S. Navy and U.S. Marine Corps aircraft.

Third Quarter 2009 and Year-to-Date 2009 Summary Financial Results

Revenue for the third quarter of 2009 was approximately $1.9 million, compared
to approximately $4.0 million for the same period last year, a decrease of
53%. Revenues were derived from contracts received in prior periods for
Counter-IED projects for the USMC and Laser Guided Energy(TM) (LGE) projects
from government research contracts.

Net loss attributable to common stockholders for the third quarter of 2009 was
$1.7 million, or $0.02 per basic and diluted share, and included non-cash
stock based compensation of $237,000, or $0.002 per basic and diluted share,
compared to the prior-comparable period net loss of $2.0 million or $0.02 per
basic and diluted common share with non-cash stock based compensation of
$663,000, or $0.01 per basic and diluted share.

Revenue for the nine months ended September 30, 2009 was approximately $6.2
million, compared to approximately $11.7 million for the same period last
year, a decrease of approximately 47%.

Net loss attributable to common stockholders for the nine months ended
September 30, 2009 was $8.0 million, or $0.09 per basic and diluted common
share, and included non-cash stock based compensation of $1.3 million, or
$0.02 per basic and diluted share, as compared to a net loss of $6.7 million
or $0.08 per diluted common share for the same period last year with non-cash
stock based compensation of $3.0 million, or $0.04 per basic and diluted
share.

At September 30, 2009, the Company had approximately $11.8 million in cash and
cash equivalents as compared to $15.5 million in cash and cash equivalents at
December 31, 2008.

As of September 30, 2009, the Company had a backlog of $4.7 million, which is
expected to be completed within the next twelve months. This backlog does not
include proposals and contracts under negotiation at September 30, 2009.

Joe Hayden, COO, commented, "We have continued to make progress in the third
quarter and have begun to move our business in a positive direction. The
awards of the contracts for the new laser application from the Navy and the
Laser Guided Energy contract from our Army customer are concrete indications
that our customers value the technologies we are developing and that we are
fulfilling their critical requirements. This is significant given the
challenging fiscal environment faced by the U.S. Government. We also continue
to improve our cost and overhead structures so that we can maintain our cash
reserves as we build our revenues and backlog.

"In the third quarter our management team initiated a new strategic plan that
will leverage the core technologies we have developed to pursue new customers
and applications in both the government and commercial business sectors.

"Additionally, the systems that we delivered to the U.S. Marine Corps continue
to perform well in their Operational Assessment. We expect to announce
further activities in this area upon the completion of negotiations with the
customers.

"Overall we are confident that we have placed ourselves in a position for
building our business and achieving success. We have reduced our costs,
removed uncertainties and distractions such as the shareholder lawsuit, gained
new contracts, continue to perform well on existing efforts and our entire
team is focused on moving forward with renewed commitment and enthusiasm."

Conference Call

Applied Energetics will host a conference call on November 9, 2009, at 11:30
a.m. ET. Shareholders and other interested parties may participate in the
conference call by dialing +1 888 713 4215 (domestic) or +1 617 213 4867
(international) and entering access code 16161769, a few minutes before 11:30
a.m. ET on November 9, 2009. The call will also be broadcast live on the
Internet at www.streetevents.com, www.fulldisclosure.com and
www.appliedenergetics.com.

A replay of the conference call will be accessible two hours after its
completion through November 16, 2009 by dialing +1 888 286 8010 (domestic) or
+1 617 801 6888 (international) and entering access code 18383229. The call
will also be archived for 30 days at www.streetevents.com,
www.fulldisclosure.com and www.appliedenergetics.com.

About Applied Energetics, Inc.

Applied Energetics, Inc., based in Tucson, Arizona, is a leader in the
advancement and application of high powered technology and products including
ultra-short pulse lasers, solid state high voltage electronics and particle
acceleration technologies for the defense and commercial business sectors.
Applied Energetics pioneered the development of Laser Guided Energy(TM)
(LGE(TM)) and the use of high voltage for counter-IED applications. For more
information about Applied Energetics, please visit www.appliedenergetics.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995:

Certain statements contained in this News Release constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve a number of known and unknown
risks, uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different from any
future results, performance or achievements expressed or implied by such
forward-looking statements.

Such factors include, but are not limited to: the dependence on sales of a
limited number of products and the uncertainty of the timing and magnitude of
government funding and orders, dependence on sales to government customers;
the uncertainty of patent protection; the uncertainty of strategic alliances;
the uncertainty of management tenure; the impact of third-party suppliers'
manufacturing constraints or difficulties; management's ability to achieve
business performance objectives, market acceptance of, and demand for, the
Company's products, and resulting revenues; development and testing of
technology and products; manufacturing capabilities; impact of competitive
products and pricing; litigation and other risks detailed in the Company's
filings with the Securities and Exchange Commission. The words "looking
forward," "believe," "demonstrate," "intend," "expect," "contemplate,"
"estimate," "anticipate," "likely" and similar expressions identify
forward-looking statements. Readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the date the
statement was made. Applied Energetics undertakes no obligation to update any
forward-looking statements contained in this news release.

APPLIED ENERGETICS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

September 30, 2009 December 31, 2008
------------------ -----------------
(Unaudited)
-----------
ASSETS
Current assets
Cash and cash equivalents $11,813,738 $15,467,386
Accounts receivable 1,306,652 2,727,853
Inventory 277,576 157,189
Prepaid expenses and deposits 129,440 495,718
Other receivables 261,849 17,183
------- ------
Total current assets 13,789,255 18,865,329
Long term receivables - 253,130
Property and equipment - net 2,964,225 3,523,641
Intangible assets - net - 36,900
Other assets 10,000 29,089
------ ------
TOTAL ASSETS $16,763,480 $22,708,089
=========== ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $324,955 $883,228
Estimated loss on uncompleted
contract - 98,239
Accrued expenses 234,387 326,697
Accrued compensation 1,081,642 1,048,774
Customer deposits 143,160 11,565
Billings in excess of costs 20,426 -
Current portion of capital
lease obligations - 2,028
-- -----
Total current liabilities 1,804,570 2,370,531
Litigation settlement payable
in common stock 1,200,000 -
Deferred rent - 4,049
- -----
Total liabilities 3,004,570 2,374,580
--------- ---------

Commitments and contingencies

Stockholders' equity
Series A Convertible Preferred
Stock, $.001 par value,
2,000,000 shares authorized;
135,572 shares issued and outstanding
at September 30, 2009 and at
December 31, 2008 136 136
Common stock, $.001 par value,
125,000,000 shares authorized;
86,535,999 shares issued and
outstanding at September 30, 2009
and 86,370,026 shares issued and
outstanding at December 31, 2008 86,536 86,370
Additional paid-in capital 75,329,623 73,936,085
Accumulated deficit (61,657,385) (53,689,082)
----------- -----------
Total stockholders' equity 13,758,910 20,333,509
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $16,763,480 $22,708,089
=========== ===========

APPLIED ENERGETICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

For the three months ended
September 30,
--------------------------
2009 2008
---- ----

Revenue $1,877,865 $4,014,302

Cost of revenue 1,777,840 3,789,962
--------- ---------

Gross profit 100,025 224,340

Operating expenses:
General and administrative 1,083,249 1,647,366
Settlement expenses 265,197 -
Selling and marketing 132,386 61,565
Research and development 210,925 359,807
------- -------
Total operating expenses 1,691,757 2,068,738
--------- ---------

Operating loss (1,591,732) (1,844,398)

Other (expense) income:
Interest expense - (388)
Interest income 8,388 123,558
----- -------
Total other 8,388 123,170
----- -------

Net loss (1,583,344) (1,721,228)

Preferred stock dividends (76,941) (277,274)
------- --------

Net loss attributable to common
stockholders $(1,660,285) $(1,998,502)
=========== ===========

Net loss per common share - basic
and diluted $(0.02) $(0.02)
====== ======

Weighted average number of shares
outstanding, basic and diluted 86,179,071 80,628,098
========== ==========

APPLIED ENERGETICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

For the nine months ended
September 30,
-------------------------
2009 2008
---- ----

Revenue $6,195,404 $11,653,390

Cost of revenue 5,810,602 10,719,524
--------- ----------

Gross profit 384,802 933,866

Operating expenses:
General and administrative 5,219,034 6,170,107
Settlement expenses 1,390,197 -
Selling and marketing 561,410 173,003
Research and development 1,051,572 965,017
--------- -------
Total operating expenses 8,222,213 7,308,127
--------- ---------

Operating loss (7,837,411) (6,374,261)

Other (expense) income:
Interest expense (19) (1,940)
Interest income 56,222 539,166
Other - 10
-- --
Total other 56,203 537,236
------ -------

Net loss (7,781,208) (5,837,025)

Preferred stock dividends (187,093) (854,585)
-------- --------

Net loss attributable to common
stockholders $(7,968,301) $(6,691,610)
=========== ===========

Net loss per common share - basic
and diluted $(0.09) $(0.08)
====== ======

Weighted average number of shares
outstanding, basic and diluted 86,186,310 80,416,412
========== ==========

SOURCE Applied Energetics, Inc.

Kevin McGrath, Cameron Associates, +1-212-245-4577, Kevin@cameronassoc.com