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Original Source: FD (FAIR DISCLOSURE) WIRE
OPERATOR: Good day, ladies and gentlemen. Welcome to your quarter one 2009 Capstone Turbine earnings conference call. My name is Robin, and I will be your coordinator for today. (OPERATOR INSTRUCTIONS) I would now like to turn the presentation over to your host for today, Miss Libby Reynolds, Chief Accounting Officer. Please proceed.
LIBBY REYNOLDS, CHIEF ACCOUNTING OFFICER, CAPSTONE TURBINE: Thank you. Good afternoon, and welcome to Capstone Turbine Corporation's conference call for the first quarter fiscal 2009 and the June 30, 2008. I'm Libby Reynolds, your contact for today's conference call. Capstone filed its quarterly report on Form 10-Q with the Securities and Exchange Commission, today, August 11, 2008. If you don't have access to this document and would like one, please contact Alice Barsoomian at 818-407-3628 or you can view all of our public filings at the SEC website at www.SEC.gov or at our website at www.microturbine.com.
During the course of this conference call, management may make projections or other forward-looking statements regarding future events or financial performance of the company within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These statements relate to, among other things, future financial performance in attaining profitability, the ability to reduce costs and improve operational efficiencies, improved overall margin in our products, the ability to obtain additional financing, the launch of the C200 and C1000 products, compliance with certain government regulations and increased government awareness of our products, opening new markets for our products and attracting large customers to our products, new applications for our products, including the hybrid bus and oil and gas markets, revenue growth and increased sales volume, our success in key markets, our ability to enter into new relationships with channel partners and distributors and other third parties, the energy efficiency, reliability and low cost of ownership of our products, expansion of production capacity and improved inventory turns, value to our customers of new low emission products, future applications of our products and environmental advantages of our products. These forward-looking statements are subject to numberous assumptions, risks and uncertainties, including the following, our expectations about expansion into key markets may not be realized.
Certain strategic business initiatives and relationships may not be sustained and may not lead to increased sales. We may not be able to reduce costs or improve customer satisfaction. The growth in our back log has significantly exceeded our internal forecast. In order to meet this increased demand, we will likely need to raise additional funds to meet our anticipated cash needs for working capital and capital expenditures during the next 12 months. We may not be able to secure needed financing. We may not be able to expand production capacity to meet demand for our products. We may not be able to obtain sufficient materials at reasonable prices. Our release of new products may be delayed or new products may not perform as we expect. We may be unable to increase our sales, and sustain or increase our profitability in the future. We may not be able to obtain or maintain customer, distributor, other relationships that result in an increase in volume and revenue. We may not be able to comply with all applicable government regulations. We may not be able to retain or develop distributors in our targeted markets, in which case, our sales would not increase as expected. And if we do not effectively implement our sales and marketing service and product enhancement plans, our sales will not grow and therefore we may not generate the net revenue we anticipate.
These are among many factors which may cause Capstone's actual results to be materially different from future results predicted or implied in such statements. We refer you to the company's form 10-K, Form 10Q and other recent filings with the Securities and Exchange Commission for descriptions of these and other risk factors. Because of the risks and uncertainties, Capstone cautions you to not place undue reliance on these statements which speak only as of today. We undertake no obligation and specifically disclaim any obligation to release any revisions, any forward-looking statements to reflect events or circumstances after the date of this conference call or to reflect the occurrence of unanticipated events. I'll now turn the call over to Darren Jamison, our President and Chief Executive Officer.
DARREN JAMISON, PRESIDENT AND CHIEF EXECUTIVE OFFICER, CAPSTONE TURBINE: Thank you, Libby. Good afternoon, everyone and welcome to Capstone's first quarter earnings call. With me is Ed Reich, our Executive Vice President and Chief Financial Officer, and Mark Gilbreth, our Executive Vice President and Chief Technical Officer.
Today I would like to start the call with a quick review of the significant events of the first quarter and then Ed will review the specific financial results. Ed will then turn the call back over to me and I will discuss our progress towards our strategic objectives and review developments in each of our key market segments and finally talk about what I hope to achieve in the fiscal year before I open the call up to your questions. During the first quarter of fiscal 2009, we continue to see the impacts of our new managing team, our new marketing and branding strategies. We continue to improve our relationships with our business partners, and we are focusing on our key suppliers as we look to increase our production rates to meet the steadily increasing demand for our products.
During the first quarter, new orders outpaced shipments as we received $20 million in new product orders and shipped $5 million in product. Therefore, back log increased $14.8 million to a company record $42.7 million. So if you analyze our back log, it has increased from $13.1 million or 144 units at the end of Q3 to $27.9 million or 428 units at the end of Q4, to where we are today with a record $42.7 million or 567 units at the end of the first quarter. So to put this back log into perspective, we ended Q1 fiscal 2008, just a year ago, with $5.3 million in back log and achieved $31.3 million in total revenue. This year we finished the first quarter with more units in back log than we shipped in all fiscal 2008 and approximately twice the number we shipped in all fiscal 2007.
However, the metric I use to measure and develop the business is a sum of quarterly revenue and back log. Because Capstone is still a developing business, our revenues can be lumpy as illustrated by the first quarter results. If you measure the business by …