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Description Of The Business And Basis Of Presentation
 9 Months Ended
Dec. 31, 2011
Description Of The Business And Basis Of Presentation [Abstract]  
Description Of The Business And Basis Of Presentation

1. Description of the Business and Basis of Presentation

     American Superconductor Corporation ("AMSC" or the "Company") was founded on April 9, 1987. The Company is a leading provider of megawatt-scale solutions that lower the cost of wind power and enhance the performance of the power grid. In the wind power market, the Company enables manufacturers to field wind turbines through its advanced engineering, support services and power electronics products. In the power grid market, the Company enables electric utilities and renewable energy project developers to connect, transmit and distribute power through its transmission planning services and power electronics and superconductor-based products. The Company's wind and power grid products and services provide exceptional reliability, security, efficiency and affordability to its customers.

     These unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the Securities and Exchange Commission's ("SEC") instructions to Form 10-Q. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States ("GAAP") have been condensed or omitted pursuant to those instructions. The year-end condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. The unaudited condensed consolidated financial statements, in the opinion of management, reflect all adjustments (consisting of normal recurring adjustments) necessary for a fair statement of the results for the interim periods ended December 31, 2011 and 2010 and the financial position at December 31, 2011. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation. Certain reclassifications of prior year amounts have been made to conform to current year presentation. These reclassifications had no effect on net income, cash flows from operating activities or stockholders' equity.

     The Company operates its business in two market-facing business units: Wind and Grid. The Company believes this market-centric structure enables it to effectively anticipate and meet the needs of wind turbine manufacturers, power generation project developers and electric utilities.

  • Wind. Through its Windtec Solutions, the Wind business segment enables manufacturers to field wind turbines with exceptional power output, reliability and affordability. The Company licenses its highly engineered wind turbine designs, provides extensive customer support services and supplies advanced power electronics and control systems to wind turbine manufactures. The Company's design portfolio includes a broad range of drive trains and power ratings up to 10 megawatts. The Company believes its unique engineering capabilities, ranging from bearings to advanced synchronous generators to blades, enables it to provide its partners with highly-optimized wind turbine platforms. Furthermore, these designs and support services typically lead to sales of its power electronics and software-based control systems, which are designed for optimized performance, efficiency and grid compatibility.
  • Grid. Through its Gridtec Solutions, the Grid business segment enables electric utilities and renewable energy project developers to connect, transmit and distribute power with exceptional efficiency, reliability and affordability. The Company provides transmission planning services that allow it to identify power grid congestion, poor power quality and other risks, which helps it determine how its solutions can improve network performance. These services often lead to sales of grid interconnection solutions for wind farms and solar power plants, power quality systems and transmission and distribution cable systems.

     On March 12, 2011, the Company entered into a Share Purchase Agreement, by and among the Company and the shareholders of The Switch Engineering Oy, a power technologies company headquartered in Finland ("The Switch"), which was amended on June 29, 2011 (as amended, the "Agreement"). Pursuant to the Agreement, the Company agreed to acquire all of the outstanding shares of The Switch. On October 28, 2011, the Company and The Switch entered into a termination agreement pursuant to which the parties mutually agreed to terminate the Agreement due to adverse market conditions for a financing required to fund the acquisition. Under the termination agreement, The Switch retained a $20.6 million advance payment as a break-up fee. As a result, the Company recorded a write-off of the advance payment during the nine months ended December 31, 2011.

     At December 31, 2011, the Company had cash, cash equivalents, and marketable securities of $63.9 million. The Company has experienced a substantial decline in revenues and incurred a net loss of $115.7 million during the nine months ended December 31, 2011. The Company's business plan anticipates a substantial use of cash from operations in its fiscal year ending March 31, 2012 in light of the difficult and uncertain current economic environment in China, the significant restructuring actions undertaken and the slowdown in the Chinese wind power market, which has accounted for more than two-thirds of the Company's revenues in recent fiscal years. At December 31, 2011, the Company has accrued liabilities related to adverse purchase commitments for inventory totaling $28.8 million. From April 1, 2011 through the date of this filing, the Company has reduced its global workforce by approximately 50%, which is expected to result in annual savings of approximately $50 million. As of December 31, 2011, the Company has a global workforce of over 400 persons. The Company�s cost reduction efforts and anticipated revenue growth are expected to result in a substantial reduction in cash used for operations during the fiscal year ended March 31, 2013. The Company plans to continue to closely monitor its expenses and if required, will further reduce operating costs and capital spending to enhance liquidity. The Company is working with its inventory suppliers to delay cash settlements and reduce the gross liability associated with its adverse purchase commitments. The Company believes that its available cash, together with additional reductions in operating costs and capital expenditures as necessary, will be sufficient to fund its operations, capital expenditures and other cash requirements for the next twelve months. To bolster its long-term liquidity, the Company intends to seek financing through means that may include public and private equity offerings, debt financings, and other financing alternatives. However, there can be no assurance that financing will be available on commercially acceptable terms or at all. The Company's liquidity is highly dependent on its ability to profitably grow its revenues, successfully manage its adverse purchase order commitments and raise additional capital as required.

     The results of operations for an interim period are not necessarily indicative of the results of operations to be expected for the fiscal year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the fiscal year ended March 31, 2011 (fiscal 2010) which are contained in the Company's Annual Report on Form 10-K.

     The Company's fiscal year begins on April 1 and ends on March 31. This document refers to fiscal 2011, which is defined as the period beginning on April 1, 2011 and concluding on March 31, 2012. The third quarter of fiscal 2011 began on October 1, 2011 and concluded on December 31, 2011.