Ambient Corporation Announces Second Quarter Financial Results

BOSTON, Aug. 11 /PRNewswire-FirstCall/ -- Ambient Corporation (OTC Bulletin Board: ABTG) today announced financial results for the second quarter ended June 30, 2010.  The Company posted record revenues of approximately $6.3 million for the six months ended June 30, 2010.

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Ambient's milestones for the first half of the year include the launching of the Open Smart Grid Communications Architecture with Verizon Wireless and its newest "all-in-one" solution, the Ambient X-3100 smart grid node.  The Company also eliminated its long-term debt, had a significant increase in revenue opportunity, and its operating loss for the three months ended June 30, 2010 narrowed to $595,543 as compared to $2,330,128 for the corresponding period in 2009.  Narrowing its operating loss allowed the Company to reduce its dependency over the quarter on the equity-based credit line first established in 2009.

"We have had a very strong start to the year that has met our expectations all around, especially with the successful product launch of our third generation smart grid node, the X-3100," said John J. Joyce, President and CEO of Ambient Corporation. "We are very encouraged by our growth and progress thus far in 2010.  Our success is the direct result of our focus on innovation and providing a market leading, best-in-class smart grid communications solution to the utility industry.  We remain confident about our outlook, the new products we're developing, our relationship with our marquee customer and the future growth of the Company."

A detailed description of Ambient's business, our results of operations and financial statements are contained in the Quarterly Report on Form 10-Q filed on August 10, 2010.

Operations Highlights -- Second Quarter

REVENUE. Revenues for the six and three months ended June 30, 2010 were $6,258,142 and $4,574,217, respectively, compared to $857,183 and $30,590 for the corresponding periods in 2009. Revenues for each of the 2010 and 2009 periods were attributable to the sales of Products and software and services to our marquee customer. Revenues for the six and three months ended June 30, 2010 related to the sales of Products totaled $6,220,422 and $4,555,357, respectively, compared to $823,253 and $30,590 for the corresponding periods in 2009. Revenue from the sale of software and services for the six and three months ended June 30, 2010 were $37,720 and $18,860, respectively, compared to $33,930 and $0 for the corresponding periods in 2009. The increase in revenue during the 2010 periods compared to the corresponding periods in 2009 reflects an increase in delivery of Ambient's X-3100 Product base to fulfill purchase orders received from our marquee customer.

To date, we have received from our marquee customer purchase orders for approximately $21 million for our X-3100 Product.

COST OF GOODS SOLD. Cost of goods sold for the six and three months ended June 30, 2010 were $3,782,123 and $2,641,085, respectively, compared to $756,854 and $25,618 for the corresponding periods in 2009. Cost of goods sold included all costs related to manufacturing and selling Product and consisted primarily of direct material. Cost of goods sold for the 2010 and 2009 periods included an inventory write down of excess and obsolete inventory. The increase in cost of goods sold during the 2010 period reflected the increase in production to fill orders placed by our marquee customer.

GROSS PROFIT. Gross profit for the six and three months ended June 30, 2010 period were $2,476,019 and $1,933,132, respectively, compared to $100,329 and $4,972 for the corresponding periods in 2009. The gross profit on Product sales amounted to $2,438,298 and $66,399, respectively, for the six and three month periods ended June 30, 2010, compared to $1,914,272 and $4,972 for the corresponding periods in 2009. Our overall gross margins increased to 42% and 40% for each of the six and three month periods in 2010 compared to 12% and 16% in the corresponding periods in 2009. The increase in the gross margin percentage in the 2010 periods compared to the 2009 periods was due to the introduction of the X-3100 which allowed for a number of factors including a consistent production and delivery schedule in 2010 and improved cost controls. The gross profit margins for the 2009 periods were lower due to the previous design of the product and low volume production.

About Ambient Corporation

Ambient designs, develops and markets Ambient Smart Grid® communications technologies and equipment. Using open standards-based technologies along with in-depth industry experience, Ambient provides utilities with solutions for creating smart grid communication platforms and technologies. Headquartered in Newton, MA, Ambient is a publicly traded company (OTC Bulletin Board: ABTG). More information on Ambient is available at www.ambientcorp.com.  

This press release contains forward-looking statements that involve substantial uncertainties and risks. These forward-looking statements are based upon our current expectations, estimates and projections about our business and our industry, and that reflect our beliefs and assumptions based upon information available to us at the date of this release. We caution readers that forward-looking statements are predictions based on our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including but not limited to, our dependence on one key customer, our ability to raise additional capital when needed, the sufficiency of working capital, the timing and delivery of purchase orders and receipt of payment in respect thereof, the risk of market acceptance of new products and underlying technologies, the competitive market generally and in the smart grid market specifically, the success of our collaborative arrangements, changes in economic conditions generally and the smart grid market specifically, changes in technology, legislative or regulatory changes that affect us, and the risks and uncertainties discussed under the heading "RISK FACTORS" in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2009, and in our other filings with the Securities and Exchange Commission. We undertake no obligation to revise or update any forward-looking statement for any reason.

Ambient, Ambient Smart Grid, Communications for a Smarter Grid and AmbientNMS are registered trademarks of Ambient Corporation with the U.S. Patent and Trademark Office.

SOURCE Ambient Corporation