Plug Power shaky, reviews options to keep going
LATHAM Plug Power, the Latham manufacturer of fuel cell systems, is looking at ways to stay in business, including a possible sale of the company, according to a news release issued Thursday.
The news isn’t too surprising for the company, which has faced delisting from the NASDAQ, declining revenues, layoffs and angry shareholders in the past year.
The company reported its fourth quarter and 2012 year-end financial results Thursday. It saw a net loss of $8.5 million in the fourth quarter and $31.9 million in 2012.
CEO Andy Marsh said there is reason to be optimistic, though. In 2012, Plug Power expanded its customer base to include Stihl, Mercedes Benz, Lowe’s, Carter’s and Ace Hardware.
The company received additional orders from existing customers such as Walmart, Coca-Cola, Wegmans and BMW. And product shipments rose 35 percent from 2011.
But Plug Power also had its fair share of trouble in 2012. Quality issues hurt its financial performance, and while the issues have been addressed, they caused sales to be delayed anywhere from six to nine months.
Increased costs caused the company to adopt a restructuring plan that included 22 layoffs and a public offering of more than 18.9 million shares of common stock and accompanying warrants it hoped would raise $2.4 million.
The move angered shareholders so much that Boston-based money management firm Interinvest Corporation Inc. and its two subsidiaries called for an alternate board to be voted in at the next annual meeting, according to a filing made with the U.S. Securities and Exchange Commission.
Interinvest called the offering an “irrational proposition” and a “clear and uncalled for destruction of shareholder value” in the SEC filing.
In the hopes of wooing back stakeholders, Plug Power’s board is considering strategies to fund its business plan. These include raising additional capital, asset sales, strategic partnerships, and even selling the company.
Last year, the company asked investment banking firm Stephens Inc. to explore and help implement these options.
“The main goal of the company is to continue to build a successful market in material handling and expand into related applications such as refrigerated trucks, ground support equipment and range extending utility vehicles,” said Marsh in the release.
“While the company has experienced significant challenges in 2012, I believe the future of Plug Power is bright and that we are in the right market, with the right customers. We remain focused on the future.”