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Superconductor Technologies Reports 2017 Second Quarter Results
Begins DOE Next Generation Electric Machines Project

AUSTIN, Texas, Aug. 10, 2017 (GLOBE NEWSWIRE) -- Superconductor Technologies Inc. (STI) (Nasdaq:SCON) reported financial results for the quarter ended July 1, 2017.

Jeff Quiram, STI’s president and CEO, stated, “In the second quarter, we remained focused on commercializing our Conductus® wire and the advancement of our U.S. Department of Energy (DOE) project. We shipped wire to multiple customers in the second quarter in conjunction with our efforts to complete product qualification. We have been actively engaged with these customers during their testing process to improve our visibility moving forward. During this period, our own comprehensive evaluation has identified additional quality control enhancements to ensure that the Conductus wire shipped fully meets the expected specifications. We continue to engage with our industry-leading customers to develop plans for supplying wire to meet their future demand.”

In June, STI was awarded a corporate agreement with the DOE for the Next Generation Electric Machines (NGEM) program. The “Process Innovations for HTS Wire Manufacturing” project has a comprehensive engineering plan that has now been implemented. In November 2016, STI was selected as the prime recipient of a $4.5 million award for this three-year DOE program. STI is collaborating with TECO Westinghouse Motor Company (TWMC), an industry leader, end user and device maker with more than 100 years of experience in motor design and application, and academic partners Massachusetts Institute of Technology and the University of North Texas.

“We are excited to kick-off the DOE project. Our partners recognize the immense value of superconducting technology for high-power electric machines and are committed to commercialization. This project team brings together the full range of required expertise, from research and development to the product manufacturing know-how necessary to achieve expanded availability of superconducting materials, which will enable the commercial viability of high power superconducting next-generation electric machines. Along with our partners, we continue to believe that STI’s goal of high performance Conductus wire at market-leading cost can be a game changer for a wide range of applications,” Quiram concluded.

Second Quarter Financial Summary
STI’s second quarter 2017 net revenues were $8,000, compared to $1,000 in the first quarter of 2017 and $11,000 in the second quarter of 2016. Net loss for the second quarter 2017 was $2.5 million, or a loss of $0.24 per basic and diluted share, compared to a net loss of $2.6 million, or a loss of $0.26 per basic and diluted share, in the first quarter of 2017, and a net loss of $3.1 million, or a loss of $1.14 per basic and diluted share in the second quarter of 2016.

For the six-month period ending July 1, 2017, total net revenues were $9,000, compared to $100,000 for the first half of 2016. The net loss for the first half of 2017 was $5.2 million, or $0.50 per share, compared to $5.7 million, or $2.14 per share. 

Please note: share and per share data for both periods is adjusted for the 1-for-15 reverse stock split effective on July 18, 2016.

As of July 1, 2017, STI had $6.5 million in cash and cash equivalents.

Investor Conference Call
STI will host a conference call and simultaneous webcast today, August 10th at 11:00 a.m. Eastern Time / 8:00 a.m. Pacific Time to discuss its results. To listen to the call live, please dial 1-888-468-2440 at least 10 minutes before the start of the conference. International participants may dial 1-719-457-6931. The conference ID is 6141253.  The call will be webcast and can be accessed from the “Investor Relations” section of the company’s website. A telephone replay will be available until midnight ET on August 14th by dialing 1-844-512-2921 or 1-412-317-6671, and entering pass code 6141253. A replay will also be available at the web address above.

About Superconductor Technologies Inc. (STI)
Superconductor Technologies Inc. is a global leader in superconducting innovation. Its Conductus® superconducting wire platform offers high performance, cost-effective and scalable superconducting wire. With 100 times the current carrying capacity of conventional copper and aluminum, superconducting wire offers zero resistance with extreme high current density. This provides a significant benefit for electric power transmission and also enables much smaller or more powerful magnets for motors, generators, energy storage and medical equipment. Since 1987, STI has led innovation in HTS materials, developing more than 100 patents as well as proprietary trade secrets and manufacturing expertise. For more than 20 years STI utilized its unique HTS manufacturing process for solutions to maximize capacity utilization and coverage for Tier 1 telecommunications operators. Headquartered in Austin, TX, Superconductor Technologies Inc.'s common stock is listed on the NASDAQ Capital Market under the ticker symbol “SCON.” For more information about STI, please visit http://www.suptech.com.

Safe Harbor Statement 
Statements in this press release regarding our business that are not historical facts are "forward-looking statements" that involve risks and uncertainties. Forward-looking statements are not guarantees of future performance and are inherently subject to uncertainties and other factors, which could cause actual results to differ materially from the forward-looking statements. These factors and uncertainties include, but are not limited to: our limited cash and a history of losses; our need to materially grow our revenues from commercial operations and/or to raise additional capital (which financing may not be available on acceptable terms or at all) in the very near future, before cash reserves are depleted (which reserves are expected to be sufficient into the first quarter of 2017), to implement our current business plan and maintain our viability; the performance and use of our equipment to produce wire in accordance with our timetable; overcoming technical challenges in attaining milestones to develop and manufacture commercial lengths of our HTS wire; the possibility of delays in customer evaluation and acceptance of our HTS wire; the limited number of potential customers and customer pressures on the selling prices of our products; the limited number of suppliers for some of our components and our HTS wire; there being no significant backlog from quarter to quarter; our market being characterized by rapidly advancing technology; the impact of competitive products, technologies and pricing; manufacturing capacity constraints and difficulties; the impact of any financing activity on the level of our stock price; the dilutive impact of any issuances of securities to raise capital; the steps required to maintain the listing of our common stock with a U.S. national securities exchange and the impact on the liquidity and trading price of our common stock if we fail to maintain such listing; the cost and uncertainty from compliance with environmental regulations; and local, regional, and national and international economic conditions and events and the impact they may have on us and our customers.

Forward-looking statements can be affected by many other factors, including, those described in the "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of STI's Annual Report on Form 10-K for the year ended December 31, 2016 and in STI's other public filings. These documents are available online at STI's website, www.suptech.com, or through the SEC's website, www.sec.gov. Forward-looking statements are based on information presently available to senior management, and STI has not assumed any duty to update any forward-looking statements.

Investor Relations Contact
Cathy Mattison or Kirsten Chapman
LHA      +1-415-433-3777       invest@suptech.com

– Tables to Follow –

                                                                                                           

SUPERCONDUCTOR TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

 
  Three Months Ended   Six Months Ended
  July 1, 2017   July 2, 2016   July 1, 2017   July 2, 2016  
                 
Revenues $ 8,000     $ 11,000     $ 9,000     $ 100,000    
                 
Costs and expenses:                
 Cost of revenues   769,000       971,000       1,631,000       1,835,000    
 Research and development   678,000       701,000       1,328,000       1,417,000    
 Selling, general and administrative   1,124,000       1,420,000       2,244,000       2,583,000    
                 
 Total costs and expenses   2,571,000       3,092,000       5,203,000       5,835,000    
                 
Loss from operations   (2,563,000 )     (3,081,000 )     (5,194,000 )     (5,735,000 )  
                 
Other Income and Expense:                
                 
 Adjustments to fair value of warrant derivatives   11,000       -       8,000       21,000    
 Other income   11,000       3,000       16,000       6,000    
                 
 Net loss $ (2,541,000 )   $ (3,078,000 )   $ (5,170,000 )   $ (5,708,000 )  
                 
Basic and diluted net loss per common share $ (.24)   $ (1.14 )   $ (.50)   $ (2.14 )  
                 
Basic and diluted weighted average number of common shares outstanding   10,699,353       2,711,697       10,333,492       2,668,799    


 
SUPERCONDUCTOR TECHNOLOGIES INC.
 
CONDENSED CONSOLIDATED BALANCE SHEETS  
  
  July 1,   December 31,
    2017       2016  
  (Unaudited)   (See Note)
  ASSETS      
       
Current Assets:      
  Cash and cash equivalents $   6,462,000      $   10,452,000  
  Accounts receivable, net   -       8,000  
  Inventory, net   63,000       68,000  
  Prepaid expenses and other current assets   212,000       109,000  
  Total Current Assets   6,737,000       10,637,000  
       
  Property and equipment, net of accumulated depreciation of      
  $10,363,000 and $9,350,000, respectively   2,516,000       3,491,000  
  Patents, licenses and purchased technology, net of accumulated amortization      
  of  $963,000 and $948,000, respectively   903,000       990,000  
  Other assets   69,000       96,000  
  Total Assets $   10,225,000      $   15,214,000  
       
LIABILITIES AND STOCKHOLDERS' EQUITY      
Current Liabilities:      
  Accounts payable $   195,000      $   336,000  
  Accrued expenses   532,000       608,000  
  Total Current Liabilities   727,000       944,000  
  Other long-term liabilities   169,000       172,000  
  Total Liabilities   896,000       1,116,000  
       
       
Stockholders’ Equity:      
  Preferred stock, $.001 par value, 2,000,000 shares authorized,      
328,925 and 333,767 shares issued and outstanding, respectively   -       -  
  Common stock, $.001 par value, 250,000,000 shares authorized,       
10,724,261 and 7,353,714 shares issued and outstanding, respectively   11,000       7,000  
  Capital in excess of par value   316,574,000       316,177,000  
  Accumulated deficit   (307,256,000 )     (302,086,000 )
  Total Stockholders' Equity   9,329,000       14,098,000  
  Total Liabilities and Stockholders' Equity $   10,225,000      $   15,214,000  


SUPERCONDUCTOR TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 
  Six Months Ended
  July 1, 2017   July 2, 2016  
         
CASH FLOWS FROM OPERATING ACTIVITIES:        
 Net loss $ (5,170,000 )   $ (5,708,000 )  
 Adjustments to reconcile net loss to net cash used in        
 operating activities:        
 Depreciation and amortization   1,028,000       1,157,000    
 Stock-based compensation expense   201,000       519,000    
 Adjustments to fair value of warrant derivatives   (8,000 )     21,000    
 Changes in assets and liabilities:        
 Accounts receivable   9,000       22,000    
 Inventories   6,000       59,000    
 Prepaid expenses and other current assets   (103,000 )     (61,000 )  
 Patents, licenses and purchased technology   71,000       (94,000 )  
 Other assets   27,000       30,000    
 Accounts payable, accrued expenses and other current liabilities   (212,000 )     3,000    
 Net cash used in operating activities   (4,151,000 )     (4,052,000 )  
         
CASH FLOWS FROM INVESTING ACTIVITIES:        
 Purchases of property and equipment   (39,000 )     -    
 Net cash used in investing activities   (39,000 )     -    
         
CASH FLOWS FROM FINANCING ACTIVITIES:        
 Net proceeds from the exercise of outstanding warrants   200,000       -    
 Net cash provided by financing activities   200,000       -    
         
Net decrease in cash and cash equivalents   (3,990,000 )     (4,052,000 )  
Cash and cash equivalents at beginning of period   10,452,000       7,469,000    
Cash and cash equivalents at end of period $   6,462,000     $   3,417,000    
         

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