ARISE Technologies Reports Fourth-Quarter and Year-End 2009 Results

On January 12, 2010, ARISE issued a release commenting on preliminary fourth-quarter and 2009 year-end results. The release is available at www.sedar.com or www.arisetech.com

WATERLOO, ON, March 25 /CNW/ - ARISE Technologies Corporation (TSX: APV and Frankfurt: A3T), which is dedicated to becoming a leader in high-performance, high-quality, cost-effective solar technology, today reported its financial results for the fourth quarter and 12-months ended December 31, 2009. Financial results conform to Canadian generally accepted accounting principles ("GAAP") and all currency amounts are in Canadian dollars unless otherwise noted.

2009 Highlights:

    
    -   Total revenue of $31.7 million, compared with $35.7 million in 2008
    -   Shipped 15.7MW of PV Cells, an increase of 40% from 11.2MW in 2008
    -   Announced creation of ARISE Technology Centre
    -   Ranked 15th on the Deloitte Technology Fast 50(TM) list of Canadian
        companies
    -   Produced first PV cells using ARISE 7N+ silicon
    -   Secured access to committed equity facility
    

Q4 2009 Highlights:

    
    -   Total revenue of $11.3 million, compared with $18.9 million in Q4
        2008
    -   Net loss decreased to $7.5 million, compared with $22.3 million in Q4
        2008
    -   Shipped 7.0MW of PV cells, an increase of 13% from 6.2MW in Q4 2008
    -   Completed $2.0 million non-brokered offering
    

Subsequent to Year End Highlights:

    
    -   Shipped approximately 10MW to date in 2010
    -   Signed Letter of Engagement with syndicate led by Sandfire Securities
        for $10 million financing
    -   Subject to satisfaction of certain Conditions Precedent, agreed with
        Commerzbank AG to extend credit facilities
    

"2009 was a challenging year for ARISE, as the impacts of the global financial crisis took a toll on both our company and the solar industry as a whole," said Vern Heinrichs, ARISE's President and Chief Executive Officer. "However, market conditions improved towards the end of year as we saw a significant increase in demand in the German marketplace. Our PV cell shipments during the fourth quarter of 2009 were 7.0MW, nearly equal to our total shipments for the first nine months of the year. By the end of 2009, Line 1 at our German PV cell plant was running at close to 100% capacity. We expect to activate Line 2 to meet customer demand during the first half of 2010."

"In Ontario, we are very optimistic about the prospects offered by the Ontario Green Energy Act's Feed-in Tariff ("FIT") program and expect it to be the source of significant growth for our Systems Division," continued Mr. Heinrichs. "We are seeing strong interest from across Ontario and, to date in 2010, we have more than $5 million worth of projects planned."

Financial Overview

Sales for the year ended December 31, 2009 amounted to $31.7 million, compared with $35.7 million in 2008. PV cells accounted for 97.9% of 2009 sales with the balance being generated by the Company's Systems Division.

Gross loss for the year ended December 31, 2009 was $25.0 million, compared with a loss of $15.8 million in 2008.

Operating expenses for the year ended December 31, 2009 were $20.4 million, compared with $21.1 million the previous year.

R&D expenses increased by 11% during the year ended December 31, 2009 to $7.1 million from $6.4 million (net of Government Funding) in 2008.

General and administrative ("G&A") expenses declined to $10.0 million in 2009, from $11.6 million for the year ended December 31, 2008.

Selling and marketing expenses for the year ended December 31, 2009 were $1.6 million, compared with $2.0 million in 2008.

Net interest expense for the year ended December 31, 2009 was $2.4 million, compared with $1.3 million the prior year.

Other income and expenses for the year ended December 31, 2009, included a foreign exchange gain of $5.6 million, compared with a foreign exchange loss of $3.9 million in 2008.

Fourth Quarter of 2009

Sales for the fourth quarter ended December 31, 2009 were $11.3 million, compared with $18.9 million in the fourth quarter of 2008. Gross loss for the three months ended December 31, 2009 was $4.7 million compared with $11.9 million in the fourth quarter of 2008. Operating expenses were $5.1 million in the fourth quarter of 2009, virtually unchanged from $5.1 million in the prior year period. ARISE recorded a net loss for the fourth quarter 2009 of $7.5 million (a loss of $0.05 per basic and diluted share), compared with a net loss $22.3 million (a loss of $0.19 per basic and diluted share) in the 2008 quarter.

Liquidity and Capital Resources

As at December 31, 2009, the Company had a working capital deficiency of $43.8 million consisting of current assets of $24.4 million less current liabilities of $68.2 million. This compares with negative working capital at September 30, 2009 of $38.9 million consisting of current assets of $25.3 million less current liabilities of $64.2 million.

Cash and cash equivalents and restricted cash at December 31, 2009 totaled $651,985, an increase of $191,065 since September 30, 2009.

Conference Call and Webcast

ARISE will hold a conference call for analysts and investors at 10:00 a.m. (Eastern) on Thursday, March 25, 2010. The company will file its financial statements, and Management Discussion and Analysis with SEDAR and these documents will be available on ARISE's website prior to the conference call. Vern Heinrichs, President and Chief Executive Officer, and Doug McCollam, Chief Financial Officer, will be available to answer questions during the call.

To participate in the call, please dial (647) 427-7450 or 1-888-231-8191 (Canada and the U.S. only) at least five minutes prior to the start of the call.

A live audio webcast of the conference call will be available at www.newswire.ca and www.arisetech.com.

An archived recording of the call will be available at 416-849-0833 or 1-800-642-1687 (Canada and the U.S. only) (Pass code: 59453933) from 1:00 p.m. on March 25, to 11:59 p.m. on March 31, 2010.

About ARISE Technologies

ARISE Technologies Corporation, based in Waterloo, Ontario, is dedicated to becoming a leader in high-performance, cost-effective solar technology. The company operates through three divisions. The PV Cell Division manufactures PV (photovoltaic) cells at its first manufacturing plant opened in April 2008 in Bischofswerda, Germany. The division is developing proprietary technology with a target of achieving a step-by-step progression to a high-efficiency level of greater than 20%. The PV Silicon Division is using a proprietary method to produce silicon at 7N+ high-purity (99.99999% purity) for PV cell applications, based on a simplified chemical vapor deposition process. The division is focusing on scaling up its process to provide ARISE with control over its supply, costs, and quality. The PV Systems Division provides complete turnkey PV solutions for solar farms and rooftop installations under the Ontario standard offer program.

The company's shares are listed on the Toronto Stock Exchange under the symbol APV and on the Frankfurt Open Market Exchange under the symbol A3T. Additional information is available at www.arisetech.com and www.sedar.com.

Forward-Looking Statements and Risk Factors

Certain statements in this news release may be considered to be forward-looking. Such statements are based on management's current expectations, estimations, and assumptions based on experience, trends, and other factors that are subject to the significant risks and uncertainties described in our regulatory filings. Please refer to these. Such risks and uncertainties may include, but are not limited to, the effects of general economic conditions, changing foreign exchange rates, actions by government authorities, the requirement for additional capital, risks associated with manufacturing, , industry supply levels, competitive pricing pressures and misjudgements in the course of preparing forward-looking statements.

Risk factors relating to ARISE are discussed in the Risk Factors section of ARISE's Annual Information Form and under the headings Liquidity and Capital Resources and Risk and Uncertainties in ARISE's year-end Management's Discussion and Analysis which are or will be available at www.sedar.com. These factors should be considered carefully, and readers should not place undue reliance on ARISE's forward-looking statements.

ARISE assumes no obligation to update any forward-looking statements or to update the reasons why actual results could differ from those reflected in the forward-looking statements.

    
    ARISE Technologies Corporation
    65 Northland Road, Waterloo, Ontario, Canada N2V 1Y8
    Doug McCollam, Chief Financial Officer, (519) 772-5706
    www.arisetech.com



                       ARISE Technologies Corporation
                         Consolidated Balance Sheets

                                                      As at         As at
                                                   December 31,  December 31,
                                                       2009          2008
                                                 -------------- -------------
                                    Assets
    Current assets
      Cash and cash equivalents                   $    401,565   $21,119,152
      Restricted cash                                  250,420     1,508,671
      Accounts receivable                            1,788,991     7,591,738
      Inventories                                    9,721,399    13,344,927
      Government assistance receivable               5,508,171    10,189,721
      Other receivables                                148,297       529,333
      Prepaid expenses                               6,615,125     5,013,496
    -------------------------------------------------------------------------
                                                    24,433,968    59,297,038

    Property, plant and equipment, net              56,161,103    40,914,106
    Long term deposits                              24,268,617    32,951,968
    Intangible assets, net                             163,814       168,382
    -------------------------------------------------------------------------
                                                  $105,027,502  $133,331,494
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

                                 Liabilities

    Current liabilities
      Bank loans                                  $ 19,594,697  $ 22,618,283
      Accounts payable and accrued liabilities      23,319,955    21,311,303
      Deferred revenue                               5,965,723     8,223,066
      Unearned government assistance                   872,325       632,325
      Current portion of long term debt             17,577,129     4,278,546
      Current portion of capital lease payable         913,428             -
    -------------------------------------------------------------------------
                                                    68,243,257    57,063,523
    -------------------------------------------------------------------------

    Long term deferred revenue                       5,556,409     4,727,912
    Long term debt                                           -     9,822,298
    Long term capital lease payable                  6,321,971             -
    -------------------------------------------------------------------------
                                                    11,878,380    14,550,210
    -------------------------------------------------------------------------

                             Shareholders' Equity

    Capital stock                                  120,986,619   119,127,644
    Contributed surplus                             10,687,834     8,085,301
    Deficit                                       (106,768,588)  (65,495,184)
    -------------------------------------------------------------------------
                                                    24,905,865    61,717,761
    -------------------------------------------------------------------------

                                                  $105,027,502  $133,331,494
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                       ARISE Technologies Corporation
           Consolidated Statements of Loss and Comprehensive Loss

                             Quarters ended                 Years ended
                              December 31,                  December 31,
                           2009           2008           2009           2008
                      ------------------------- -----------------------------
    Sales          $ 11,298,585   $ 18,938,251   $ 31,729,057   $ 35,730,734
    Cost of goods
     sold            11,547,565     21,815,164     37,342,901     42,536,545
    Valuation
     write-down
     of inventory
     related assets   4,456,053      8,978,726     19,343,210      8,978,726
    -------------------------------------------------------------------------
    Gross (loss)     (4,705,033)   (11,855,639)   (24,957,054)   (15,784,537)
    -------------------------------------------------------------------------
    Expenses
      Research and
       development    1,358,176      1,863,815      7,105,868      6,401,587
      General and
       adminis-
       trative        2,928,044      2,557,750      9,965,046     11,643,599
      Selling and
       marketing        420,671        423,338      1,589,425      2,031,686
      Depreciation
       and
       amortization     397,952        270,097      1,752,042      1,072,959
    -------------------------------------------------------------------------
                      5,104,843      5,115,000     20,412,381     21,149,831
    -------------------------------------------------------------------------

                     (9,809,876)   (16,970,639)   (45,369,435)   (36,934,368)
    -------------------------------------------------------------------------
    Other expenses
     (income)
      Interest
       expense, net     678,163        590,666      2,370,182      1,339,194
      Foreign
       exchange
       (gain) loss   (2,623,017)     4,668,324     (5,566,813)     3,954,898
      Other (income)
       expense         (353,589)        22,866       (899,400)        80,413
    -------------------------------------------------------------------------
                     (2,298,443)     5,281,856     (4,096,031)     5,374,505
    -------------------------------------------------------------------------

    Net loss and
     comprehensive
     loss            (7,511,433)   (22,252,495)   (41,273,404)   (42,308,873)

    Deficit,
     beginning
     of year        (99,257,155)   (43,242,689)   (65,495,184)   (23,186,311)
    -------------------------------------------------------------------------

    Deficit, end
     of year      $(106,768,588)  $(65,495,184) $(106,768,588)  $(65,495,184)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Loss per share
     - basic
     and diluted   $      (0.05)  $      (0.19)  $      (0.32)  $      (0.36)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                       ARISE Technologies Corporation
                    Consolidated Statements of Cash Flows

                             Quarters ended                 Years ended
                              December 31,                  December 31,
                           2009           2008           2009           2008
                      ------------------------- -----------------------------

    Cash flows
     (used in) from
     operating
     activities
      Net loss for
       the year    $ (7,511,433)  $(22,252,495)  $(41,273,404)  $(42,308,873)
      Items which
       do not
       involve cash:
        Valuation
         write-down
         of inventory
         related
         assets       4,456,053      8,978,726     19,343,210      8,978,726
        Foreign
         exchange    (1,872,688)    (4,247,689)    (5,339,628)    (3,473,816)
        Depreciation
         and
         amortization 1,554,146        988,550      5,483,383      2,458,352
        Employee
         stock based
         compensation   162,827        669,568      1,964,337      4,552,531
        Non-employee
         stock based
         compensation    13,566         96,449        127,965        276,091
        Fair value
         of warrants
         issued         684,771              -        684,771              -
    -------------------------------------------------------------------------
                     (2,512,758)   (15,766,891)   (19,009,366)   (29,516,989)

    Changes in working
     capital items
     from operations
        Decrease
         (increase)
         in accounts
         receivable    (178,321)     1,040,899      5,802,747     (7,337,713)
        Decrease
         (increase)
         in
         inventories (3,292,619)       633,395     (9,707,692)   (16,372,428)
        Decrease
         (increase)
         in other
         receivables   (114,294)      (262,755)       381,036        948,251
        Decrease
         (increase)
         in prepaid
         expenses      (533,499)    (1,993,345)    (4,802,620)    (8,977,057)
        Decrease
         (increase)
         in other
         assets         174,236              -              -              -
       (Decrease)
         increase
         in accounts
         payable
         and accrued
         liabilities  3,912,008      7,115,889      1,834,111     12,330,507
       (Decrease)
         increase in
         deferred
         revenue       (392,675)     5,680,432     (1,294,053)    12,903,715
    -------------------------------------------------------------------------
                     (2,937,922)    (3,552,376)   (26,795,837)   (36,021,714)
    -------------------------------------------------------------------------

    Cash flows
     (used in) from
     financing
     activities
      Issuance of
       capital
       stock for
       cash           2,250,000        182,860      2,250,000     45,280,904
      Share
       issuance
       costs           (391,025)        (1,956)      (391,025)    (2,520,608)
      Exercise of
       warrants
       and options            -              -              -      2,625,622
      Net proceeds
       (repayment)
       of bank loans   (121,369)     3,538,848       (350,869)    25,004,263
      Proceeds of
       long term debt   808,879      5,383,630      6,896,462     14,100,844
      Repayment of
       long term
       debt                   -              -     (1,022,637)             -
      Increase in
       capital lease  7,369,977              -      7,369,977              -
    -------------------------------------------------------------------------
                      9,916,462      9,103,382     14,751,908     84,491,025
    -------------------------------------------------------------------------

    Cash flows from
     (used in)
     investing
     activities
      Decrease
       (increase)
       in restricted
       cash                   -     (1,508,671)     1,258,251     (1,508,671)
      Government
       assistance       252,829      4,499,962     13,248,953     10,830,312
      Change in
       long term
       deposits         711,197     (1,046,557)     5,872,353    (28,490,426)
      Purchase of
       capital
       assets        (7,736,870)    (8,109,962)   (29,017,735)   (45,954,392)
      Purchase of
       intangible
       assets           (14,631)       (96,326)       (35,480)      (135,412)
    -------------------------------------------------------------------------
                     (6,787,475)    (6,261,554)    (8,673,658)   (65,258,589)
    -------------------------------------------------------------------------
    Net cash
     outflow            191,065       (710,548)   (20,717,587)   (16,789,278)

    Cash and cash
     equivalents,
     beginning of
     year               210,500      21,829,700    21,119,152     37,908,430
    -------------------------------------------------------------------------

    Cash and cash
     equivalents,
     end of year   $    401,565   $ 21,119,152   $    401,565   $ 21,119,152
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Supplemental
     disclosures
     of cash flows:
    Interest and
     stand-by fees
     paid          $    678,502   $    296,588   $  2,418,302   $  1,624,966
    -------------------------------------------------------------------------
    Income taxes
     paid          $          -   $          -   $          -   $          -
    -------------------------------------------------------------------------
    

%SEDAR: 00017494E

SOURCE ARISE TECHNOLOGIES CORPORATION

For further information: For further information: Investor Relations: Glen Williams, The Equicom Group, (416) 815-0700 x272

Organization Profile

ARISE TECHNOLOGIES CORPORATION

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890