EX-99.1 2 v131686_ex99-1.htm Unassociated Document
EXHIBIT 99.1

Contact:
Joseph Kaveski, CEO
John Davenport, President
Eric Hilliard, COO
Nick Berchtold, CFO
440-715-1300

Investor Relations Contact:
BPC Financial Marketing
John Baldissera
800-368-1217

ENERGY FOCUS, INC. REPORTS THIRD QUARTER 2008 RESULTS
11% year over year growth led by a 33% increase in EFO® sales
 
SOLON, Ohio, November 6, 2008 -- Energy Focus, Inc. (NASDAQ: EFOI) today announced financial results for the third quarter ended September 30, 2008.
Financial and operating highlights include the following:
 
 
·
Revenues for the third quarter of 2008 were $6.4 million, an increase of 11% over revenues of $5.7 million for the third quarter 2007. The net loss in the quarter was $1.6 million ($0.11 per share) compared to a net loss of $3.2 million ($0.28 per share) in the third quarter of 2007.
 
·
Year-to-date revenues were $18.8 million, an increase of 8% over revenues of $17.5 million for the first three quarters of 2007. Year-to-date net loss was $6.7 million ($0.48 per share) compared to a net loss of $7.7 million ($0.67 per share) for the first three quarters of 2007.
 
·
The company finished the third quarter with a balance sheet showing cash at $12.4 million and total shareholders’ equity of $24.7 million, which includes $9.3 million received March 17, 2008 from an equity financing, net of expenses. Cash growth in the third quarter of 2008 was $0.2 million, compared to cash utilization of $1.2 million for the third quarter of 2007.
 
·
Operating expenses decreased by 25%, $1.3 million, for the quarter compared to the third quarter of 2007. The improvement was the result of actions taken in 2007 as well as in the first half of 2008 having effect in Q3. Continued reductions in expenses are expected in Q4.
 
·
EFO sales increased to $2.7 million for the third quarter of 2008, compared to $2.0 million for the third quarter of 2007.
 
·
In view of the current economic environment, the company has revised its previous 2008 EFO sales forecast of 100% growth over 2007 to about a 60% growth rate, or approximately $11 million in EFO sales for this year.
 
 
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“I continue to be encouraged by our growth. Despite the difficult economy, our energy efficient products continue to be in demand. I am also excited by the success of our cost containment measures which have led to positive cash flow in the third quarter,” said Joe Kaveski, CEO of Energy Focus, Inc.

Mr. Kaveski continued, “We were pleased to report our first two successes that demonstrate traction in building Energy Focus into a full-service lighting energy solutions provider. Our recent successes with Great Lakes Cold Storage and Architectural Floors of Cleveland clearly show that customers value our unique technologies, expertise and our comprehensive approach to improving their bottom lines.”

Energy Focus, Inc. management will host a conference call on November 6, 2008 at 4:30 p.m. EST (1:30 p.m. PST) to review the third quarter 2008 financial results and other corporate events, followed by a Q & A session. Dialing 1-888-542-9137 (US/Canada) or 1-706-758-4961 (International/Local) can access the call. The conference ID number is 71538301. Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. The conference call will also be available over the Internet at http://www.energyfocusinc.com in the Investor Relations area of the site. A replay of the conference call will be available two hours after the call for the following seven days by dialing 1-800-642-1687 (US/Canada) or 1-706-645-9291 (international/local) and entering the following pass code: 71538301. Also, an instant replay of the conference call will be available over the Internet at http://www.energyfocusinc.com.

About Energy Focus
Energy Focus, Inc. is the leading supplier of energy solutions and the world's only supplier of EFO, a lighting technology which is more efficient than conventional electric lamps. Energy Focus products are designed, manufactured and marketed for the commercial lighting, sign and swimming pool, and spa markets. Energy Focus solutions provide energy savings, aesthetic, safety and maintenance cost benefits over conventional lighting. Customers include supermarket chains, retail stores, museums, theme parks and casinos, hotels, swimming pool builders, spa manufacturers and many others. Company headquarters are located at 32000 Aurora Rd., Solon, OH 44139. The company has additional offices in Pleasanton, CA, United Kingdom and Germany. For more information, see http://www.energyfocusinc.com.
 
Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements regarding the business outlook for 2008 and thereafter the potential growth of EFO sales based upon its energy savings over conventional lighting. Investors are cautioned that all forward-looking statements involve risks and uncertainties. Actual results may differ materially from the results predicted. Risk factors that could affect the Company's future include, but are not limited to, a slowing of the U.S. and world economy and its effects on Energy Focus' markets, failure to develop marketable products from new technologies, failure of EFO or other new products to meet performance expectations, higher than anticipated expenses, unanticipated costs of integrating acquisitions into the Energy Focus operation, delays in manufacturing of products, increased competition, other adverse sales and distribution factors and greater than anticipated costs and/or warranty expenses. For more information about potential factors which could affect Energy Focus financial results, please refer to the Company's SEC reports, including its Annual Reports on Form 10-K and its quarterly reports on Form 10-Q. These forward-looking statements speak only as of the date hereof. Energy Focus disclaims any intention or obligation to update or revise any forward-looking statements.
 
 
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ENERGY FOCUS, INC.
CONSOLIDATED BALANCE SHEETS
(amounts in thousands)

   
September 30,
 
December 31,
 
 
 
2008
 
2007
 
 
 
(unaudited)
 
 
  
ASSETS
              
Current assets:
              
Cash and cash equivalents
  
$
12,443
  
$
8,412
  
Accounts receivable trade, net
    
3,724
    
3,698
  
Inventories, net
    
6,423
   
6,888
  
Prepaid and other current assets
    
302
   
381
  
Total current assets
    
23,742
   
19,379
  
               
Fixed assets, net
    
4,707
   
5,316
  
Goodwill, net
    
4,318
   
4,359
  
Other assets
    
103
   
59
  
Total assets
  
$
32,020
  
$
29,113
  
               
LIABILITIES
              
Current liabilities:
              
Accounts payable
  
$
2,319
  
$
2,265
  
Accrued liabilities
    
1,843
    
1,473
  
Deferred revenue
    
244
    
244
  
Credit line borrowings
    
1,063
    
1,159
  
Short-term bank borrowings
    
1,189
    
1,726
  
Total current liabilities
    
6,658
    
6,867
  
Other deferred liabilities
    
62
    
62
  
Deferred tax liabilities
    
372
    
252
  
Long-term bank borrowings
    
262
    
314
  
Total liabilities
    
7,354
    
7,495
  
               
SHAREHOLDERS’ EQUITY
              
Common stock
    
1
    
1
  
Additional paid-in capital
    
65,715
    
55,682
  
Accumulated other comprehensive income
    
502
    
815
  
Accumulated deficit
    
(41,552
)
  
(34,880
)
Total shareholders’ equity
    
24,666
   
21,618
  
Total liabilities and shareholders’ equity
  
$
32,020
  
$
29,113
  
 
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ENERGY FOCUS, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except per share amounts)
(unaudited)

 
 
Three months
 
Nine months
 
 
 
ended September 30,
 
ended September 30,
 
 
 
2008
 
2007
 
2008
 
2007
  
Net sales
  
$
6,357
  
$
5,745
  
$
18,810
  
$
17,458
  
Cost of sales
    
4,047
    
3,757
    
12,813
    
11,720
  
Gross profit
    
2,310
    
1,988
    
5,997
    
5,738
  
Operating expenses:
                          
                           
Research and development
    
569
    
805
    
2,170
    
1,963
  
Sales and marketing
    
2,118
    
2,390
    
6,700
    
7,338
  
General and administrative
    
1,198
    
1,668
    
3,750
    
3,813
  
Restructure expense
    
--
    
308
    
--
    
397
  
Total operating expenses
    
3,885
    
5,171
    
12,620
    
13,511
  
Loss from operations
    
(1,575
)
  
(3,183
)
  
(6,623
)
  
(7,773
)
Other income (expense):
                          
Other income/(expense)
    
(14
)
  
35
    
18
    
77
  
Interest income
    
45
    
51
    
53
    
190
  
                           
Loss before income taxes
    
(1,544
)
  
(3,097
)
  
(6,552
)
  
(7,506
)
Benefit from (provision for) income taxes
    
(40
)
  
(78
)
  
(120
)
  
(145
)
Net loss
  
$
(1,584
)
$
(3,175
)
$
(6,672
)
$
(7,651
)
                           
Net loss per share - basic and diluted
  
$
(0.11
)
$
(0.28
)
$
(0.48
)
$
(0.67
)
                           
Shares used in computing net loss per share - basic and diluted
    
14,832
    
11,501
    
13,950
    
11,467
  
 
 
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