Envision Solar Announces Full Year 2012 Financial Results; Provides Business Update and Outlook for 2013
* Reuters is not responsible for the content in this press release.
For best results when printing this announcement, please click on the link below: http://pdf.reuters.com/pdfnews/pdfnews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20130401:nPnSF86021 SAN DIEGO, April 1, 2013 /PRNewswire/ -- Envision Solar International, Inc. (EVSI: OTCQB) ("Envision Solar," or the "Company"), a manufacturer and designer of unique, architecturally accretive, renewable energy systems, today announced results for the three and twelve months ended December 31, 2012. CY2012 Highlights: * Signed MOU with Horizon Energy for 2,300 Solar Tree arrays in North Carolina * Sold first two units of its breakthrough EV ARC standalone solar charging station * Signed contract for the first dealership in the Cadillac Solar Tree Program * Reduced operating cash outflows by approximately $808,000 to $1,162,812 * Signed first international sales agreement with Al Habtoor in the Middle East * Exhibited at first International trade show in Abu Dhabi Desmond Wheatley, Chief Executive Officer of Envision Solar, explained, "We are making the necessary investments to build a stronger and more competitive company. After two years of working with General Motors, we are delighted to become the exclusive provider of Solar Tree arrays to Cadillac's 952 U.S. dealerships. This is truly a breakthrough relationship that will provide significant long term benefits to Envision Solar, Cadillac, each dealership owner and consumers alike." Full Year 2012 Financial Results Net revenues were $721,835 for the twelve months ended December 31, 2012 compared to $2,303,142 for the same period in the prior year. The Company's decision to focus on engineering and scalability improvements while developing strategic relationships with larger customers resulted in elongated sales cycles in 2012. Operating expenses were $2,368,793 during 2012, down from $3,571,558 in 2011. The Company incurred lower non-cash stock-based compensation expenses in 2012 while reducing certain targeted marketing expenses and investor relations costs. Net loss and net loss per share were $2,481,728 and $0.04 in 2012 compared to $2,547,493 and $0.05 in 2011, respectively. The weighted average shares outstanding increased from 47,440,255 to 55,479,675 in 2012. Envision Solar had $257,396 of cash and $1,726,000 in short term borrowings at December 31, 2012. Cash used in operating activities was $1,162,812 for the year ended December 31, 2012 compared to $1,970,831 for the same period in 2011. Subsequent to the end of fiscal 2012, the Company raised approximately $1.7 million (net) in a private placement. The Company intends to complete the $2.19 million private placement sometime in early Q2 2013. Business Update Over the past seven years, Envision Solar has developed innovative solar structures based on proprietary technologies and designs. Its three main product lines - Solar Tree array, Solar Tree Socket, and EV ARC systems - are used in retail, utility, commercial property, and government campus parking lots and public spaces, respectively. The Company has been selected by General Motors to be the exclusive supplier of Solar Tree arrays to Cadillac's 952 dealers in the U.S. This opportunity provides an excellent entry into a rapidly growing market as auto manufacturers and dealers make efforts to enhance their sustainability image as well as capitalize on the growing consumer demand for electric vehicles (EVs). The Company is increasingly well positioned to tap the burgeoning opportunity to sell its Solar Tree arrays and Solar Groves to corporate, university and government clients. Entities such as General Motors, McDonalds, Dell, Kyocera, San Diego Gas and Electric (SDG&E), Axion Power, and the U.S. Navy have deployed Envision Solar's arrays, often with integrated EV charging stations, on their campuses and in their parking lots. Customizable for each client's needs and equipped with Envision Solar's proprietary EnvisonTrak tracking technology and SunCharge "column integrated" EV charging stations, these highly standardized and engineered solar products provide rapid deployment and superior performance and flexibility compared to traditional solar installations. Envision Solar's latest product, the EV ARC, is a cost-effective, easy-to-install, standalone solar charging station that requires no foundation, no trenching, no building permit and no grid connection. One of the main prerequisites to mass adoption of EVs is having a sufficient number of charging stations. EV ARC captures and stores up to 22.5 kWh per day of power in each integrated unit, sufficient to charge one electric vehicle each day. The Company will initially target municipal, retail and corporate customers who are looking for rapid, pain-free deployments of EV charging infrastructure without all the challenges associated with conventional units. With global sales of EVs forecasted to be in the tens of millions in the next few years, the Company expects EV ARC to be a significant source of revenues. Envision Solar's products provide rapid returns on investment (ROI) to customers by delivering direct and indirect benefits. For car dealers, the Solar Tree arrays will elevate the dealers' branding and drive additional sales through a highly visible structure that can be customized to suit their brand. The Solar Tree arrays also serve as charging stations for electric vehicles - which creates additional traffic and sales opportunities. Each dealer is able to garner positive media coverage by installing these innovative and beautiful structures. The combination of tangible and intangible benefits make Envision Solar's products economically very attractive. Highly engineered and architecturally accretive Solar Tree structures attract customers, enhance property values and improve tenant and employee recruitment and retention. The Company uses a combination of internal and outsourced resources to design, manufacture and assemble its products. In the past two years, its engineering and manufacturing teams have developed and refined a highly scalable and efficient design and assembly process that allows the Company to produce high quality products which can be rapidly deployed individually or at scale with minimal disruption to the customer location. This flexible model, which allows the Company to manufacture and deploy products based on demand, creates significant operating leverage which should deliver industry leading profitability at scale. Progress Report The Company made significant investments in 2012, including: 1A redesign of its flagship Solar Tree® structure to allow for a significant reduction in the field labor required for its installation. 2Redesign and product development aimed at making the Company's products highly scalable and exportable both domestically and internationally. 3The invention and engineering of the EV ARC™. 4Ongoing and successful efforts to close business with large opportunities such as Cadillac. Management believes these investments position the Company with sustainable, competitive advantages to support higher sales. Mr. Wheatley continued, "We want to become an efficient and profitable company on a sustainable basis. Our EV ARC technology, which is easier and less costly to deploy and capable of delivering power night and day, is an example of our vision to use less disruptive technologies to enter a large, untapped market." 2013 Outlook Envision Solar continues to aggressively invest in new products and pursue new business opportunities. The Company anticipates several upcoming milestones: 1Q1 2013. Installation of the first Cadillac Solar Tree® structure in a dealership. 2Q2 2013. Initial roll-out of its EV ARC™ standalone solar charging station to the market. 3April 2013. Participate as Cadillac's sole solar provider partner at GM's 2013 dealers' convention. 4Q2 2013. Design and engineering of the 2300 Solar Tree® installation in North Carolina. 5Q2 2013. Close $2.19 million equity financing platform. 6FY 2013. First international sales. "We start 2013 in a stronger position than we have been in since I joined the Company," concluded Mr. Wheatley. "With our financing nearly complete, we are focused on executing the commercial opportunities we have with GM, Horizon Energy and others, while developing a pipeline of future customers and partners. We look forward to updating our shareholders on these exciting developments in the coming months." Notice This notice does not constitute an offer to sell nor a solicitation to buy a security. Any offer to sell or a solicitation to buy a security from the Company is made only to prospective investors with whom the Company or its registered placement agent has a pre-existing relationship and only by the complete Confidential Private Placement Memorandum covering the Company's common stock and warrants in the private placement, including the risk factors described in the Memorandum. The securities offered in the Company's private placement have not been registered under the Act or any state securities laws. No shares may be resold, assigned or otherwise transferred unless a registration statement under the Act is in effect, or the Company has received evidence satisfactory to it that such transfer does not involve a transaction requiring registration under the Act and is in compliance with the Act. About Envision Solar International, Inc. Envision Solar, www.envisionsolar.com, designs, manufactures and deploys unique, proprietary and architecturally accretive renewable energy systems with a Drag & Drop Infrastructure product line. The company's flagship products include the patented Solar Tree array and Solar Tree Socket solar shaded parking solutions with EnvisionTrak, a proprietary and patent pending solar tracking machine, and SunCharge Column Integrated Electric Vehicle Charging Stations. Based in San Diego the company integrates only the highest quality components into its Made in America products ensuring long and trouble free service and timeless beautification of the parking lots they serve. This unique approach to the industry allows the company's commercial and institutional customers to take full advantage of the value creation associated with transforming parking lots into beautiful, shaded, renewable energy generation plants shrouded in the "Green Halo." For more information on Envision Solar, visit www.envisionsolar.com or call (866) 746-0514. About MZ Group MZ Group, subsidiary of @titude Global, a multinational company and the world's largest independent global investor relations consulting firm, provides investor relations, corporate communications, market intelligence, corporate governance and technology products and services. Founded in 1999, MZ Group focuses on innovation and personalized services, supported by its exclusive "one-stop-shop" business model. With offices in Sao Paulo, New York, Chicago, San Diego, Vancouver, Hong Kong, Beijing, Shanghai, Taipei and Mumbai, MZ has approximately 350 professionals who serve over 580 clients in 12 countries. For more information, please visit www.mzgroup.com. Forward-Looking Statements This Press Release may contain forward-looking statements regarding future events or our expected future results that are subject to inherent risks and uncertainties. All statements in this Report other than statements of historical facts are forward looking statements. Forward looking statements are generally accompanied by terms or phrases such as "estimate," "project," "predict," "believe," "expect," "anticipate," "target," "plan," "intend," "seek," "goal," "will," "should," "may," or other words and similar expressions that convey the uncertainty of future events or results. Statements contemplating or making assumptions regarding actual or potential sales, market size and demand, prospective business contracts, customer orders, trends or operating results also constitute forward looking statements. Our actual results may differ substantially from those indicated in forward looking statements because our business is subject to significant economic, competitive, regulatory, business and industry risks which are difficult to predict and many of which are beyond our control. Our operating results, financial condition and business performance may be adversely affected by a general decline in the economy, unavailability of capital or financing for our prospective customers to purchase products and services from us, competition, changes in regulations, a decline in the demand for solar energy, a lack of profitability, a decline in our stock price, and other risks. We may not have adequate capital, financing or cash flow to sustain our business or implement our business plans. Current results and trends are not necessarily indicative of future results that we may achieve. Contact: Lindsay Adams Envision Solar International, Inc. Tel: +1-858-799-4583 Email: firstname.lastname@example.org Web: www.envisionsolar.com Investor Relations: MZ North America Ted Haberfield, President Tel: +1-760-755-2716 Email: email@example.com Web: www.mzgroup.us Envision Solar International, Inc. and Subsidiaries Consolidated Balance Sheets December 31, 2012 2011 Assets Current Assets Cash $ 257,396 $ 468,776 Accounts Receivable, net 329,516 1,444,974 Prepaid and other current assets 63,181 43,861 Costs and estimated earnings in excess of billings on uncompleted contracts - 42,580 Inventory 56,325 - Total Current Assets 706,418 2,000,191 Property and Equipment, net 91,276 142,136 Other Assets Debt issue costs, net 5,000 30,480 Deposits 9,407 3,157 Total Other Assets 14,407 33,637 Total Assets $ 812,101 $ 2,175,964 Liabilities and Stockholders' Deficit Current Liabilities Accounts Payable $ 630,036 $ 1,513,691 Accounts Payable - Related Parties - 109,145 Accrued Expenses 236,029 179,774 Accrued Rent 122,421 113,004 Sales Tax Payable 38,864 42,266 Deferred Revenue 80,000 - Billings in excess of costs and estimated earnings on uncompleted contracts 26,838 102,921 Convertible Note Payable -Related Party 122,683 122,683 Notes Payable 97,000 145,017 Convertible Notes Payable, net of discount of $456,073 and $674,254 at December 31, 2012 and 2011 respectively 1,050,253 1,681,689 Embedded Conversion Option Liability 456,073 647,977 Total Current Liabilities 2,860,197 4,658,167 Commitments and Contingencies (Note 10) Stockholders' Deficit Common Stock, $0.001 par value, 162,500,000 million shares authorized,58,097,609and 49,405,732 shares issued or issuable and outstanding at December 31, 2012 and 2011, respectively 58,098 49,406 Additional Paid-in-Capital 22,715,994 19,808,851 Accumulated Deficit (24,822,188) (22,340,460) Total Stockholders' Deficit (2,048,096) (2,482,203) Total Liabilities and Stockholders' Deficit $ 812,101 $ 2,175,964 The accompanying notes are an integral part of these Consolidated Financial Statements Envision Solar International, Inc. and Subsidiaries Consolidated Statements of Operations For the Year Ended December 31, 2012 2011 Revenues $ 721,835 $ 2,303,142 Cost of Revenues 553,228 1,742,791 Gross Profit 168,607 560,351 Operating Expenses (including stock based compensation expense of $832,225 for the year ended December 31, 2012 and $1,675,141 for the year ended December 31, 2011) 2,368,793 3,571,558 Loss From Operations (2,200,186) (3,011,207) Other Income (Expense) Other Income 1,525 996 Gain on Debt Settlement,net 42,731 266,073 Interest Expense (972,027) (754,126) Change in fair value of embedded conversion option liability 647,977 963,931 Total Other Income (Expense) (279,794) 476,874 Income (Loss) Before Income Tax (2,479,980) (2,534,333) Income Tax Expense 1,748 13,160 Net Loss $ (2,481,728) $ (2,547,493) Net Loss Per Share- Basic and Diluted $ (0.04) $ (0.05) Weighted Average Shares Outstanding- Basic and Diluted 55,479,675 47,440,255 The accompanying notes are an integral part of these Consolidated Financial Statements Envision Solar International, Inc. and Subsidiaries Consolidated Statements of Cash Flows For the Year Ended December 31, 2012 2011 CASH FLOWS FROM OPERATING ACTIVITIES: Net Loss $ (2,481,728) $ (2,547,493) Adjustments to Reconcile Net loss to Net Cash Used in Operating Activities: Depreciation 60,428 65,026 Bad debt expense (recovery) (14,488) 14,488 Warrants issued as debt issuance fees 12,274 - Common Stock issued for Services 6,993 271,458 Amortization of prepaid expenses paid in common stock 46,226 97,967 Gain on debt Settlement, net (8,731) (223,771) Gain on settlement of debt for common stock (34,000) (42,302) Compensation expense related to grant of stock options 766,732 1,305,716 Change in fair value of embedded conversion option liability (647,977) (963,931) Amortization of debt discount 674,254 517,284 Amortization of debt issue costs 30,480 9,520 Changes in assets and liabilities: (Increase) decrease in: Accounts Receivable 1,129,946 (1,413,497) Prepaid Expenses and other current assets 1,954 7,585 Costs in excess of billings on uncompleted contracts - 7,472 Costs and estimated earnings in excess of billings on uncompleted contracts 42,580 (42,580) Inventory (56,325) - Deposits (6,250) 393 Increase (decrease) in: Accounts Payable (839,460) 651,612 Accounts Payable - related party (109,145) - Accrued Expenses 253,493 223,416 Accrued Rent 9,417 9,417 Sales Tax Payable (3,402) 5,438 Deferred Revenue 80,000 - Billings in excess of costs on uncompleted contracts - (21,169) Billings in excess of costs and estimated earnings on uncompleted contracts (76,083) 97,120 NET CASH USED IN OPERATING ACTIVITIES (1,162,812) (1,970,831) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of Equipment (9,568) (12,959) NET CASH USED IN INVESTING ACTIVITIES (9,568) (12,959) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from Issuance of notes payable - 1,000,000 Repayments on convertible notes payable - (34,246) Proceeds from Sale of Common Stock 1,050,000 1,717,251 Payments of offering costs related to sale of common stock (84,000) (254,513) Payments of Debt Issue Costs (5,000) (40,000) NET CASH PROVIDED BY FINANCING ACTIVITIES 961,000 2,388,492 NET INCREASE IN CASH (211,380) 404,702 CASH AT BEGINNING OF YEAR 468,776 64,074 CASH AT END OF YEAR $ 257,396 $ 468,776 Supplemental Disclosure of Cash Flow Information: Cash paid for interest $ 12,268 $ 15,693 Cash paid for income tax $ 1,748 $ 13,160 Supplemental Disclosure of Non-Cash Investing and Financing Activities: Prepaid common stock issued for services $ 67,500 $ 270,000 Conversion of accounts payable to convertible notes payable $ 20,000 $ 16,140 Common stock issued for debt settlement $ - $ 195,000 Common stock issued in conversion of note payable and accrued interest $ 48,500 $ 33,000 Common stock issued in conversion of convertible note payable $ 1,047,836 $ 16,140 Prepaid warrants for common stock issued for services $ - $ 119,361 Warrants for common stock issued in debt settlement $ - $ 209,006 Capitalization of accrued interest to notes payable $ 2,004 $ - Capitalization of accrued interest to convertible notes payable $ 130,383 $ 140,054 Embedded conversion option liability recorded as debt discount $ 456,073 $ 647,977 Convertible note payable issued in exchange of note payable $ - $ 58,318 The accompanying notes are an integral part of these Consolidated Financial Statements SOURCE Envision Solar International, Inc.