Capstone Turbine Earnings: Fifth Straight Quarter of Expanding Margins

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Capstone Turbine Corporation (NASDAQ:CPST) reported its results for the second quarter. Capstone Turbine develops, manufactures, markets, and services microturbine technology solutions for use in stationary distributed power generation applications.

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Capstone Turbine Corporation Earnings Cheat Sheet

Results: Reported a loss of $6.2 million (2 cents per diluted share) in the quarter. Capstone Turbine Corporation had a net income of $1.3 million or 0 cents per share in the year-earlier quarter.

Revenue: Rose 9.6% to $30.1 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Capstone Turbine Corporation fell in line with the mean analyst estimate of a loss of 2 cents per share. Analysts were expecting revenue of $29.9 million.

Quoting Management: “Our second quarter results demonstrate continued progress on our path to profitability,” said Darren Jamison, Capstone’s President and Chief Executive Officer. “Revenue and gross margin each reached the highest points in company history, and we delivered the third consecutive quarter of record backlog. Order flow was robust, increasing 21% year-over-year and generating a book-to-bill ratio of greater than one to one. Our cash cycle was particularly strong, with improved DSO and inventory turns, and reduced cash burn, and we continue to maintain a healthy cash balance. Demand in the U.S. is very healthy, especially in the oil and gas sector as well as in the Eastern region where our products are being used in energy efficiency applications. We received a number of large follow-on orders from key customers for high profile installations in New York City during the quarter. Ongoing momentum in North and South America and the Pacific Rim is offsetting some of the weakness in European markets. With these positive business indicators and our improving financial performance, we feel confident about our continued progress in the second half of Fiscal 2013.”

Key Stats:

Revenue has increased for four quarters in a row. Revenue increased 18.7% to $28.8 million in the first quarter. The figure rose 32.4% in the fourth quarter of the last fiscal year from the year earlier and climbed 13.8% in the third quarter of the last fiscal year from the year-ago quarter.

After missing the mark in the previous two quarters, the company met analyst estimates. In the first quarter, it fell short by one cent, and in the fourth quarter of the last fiscal year, it was under-estimate by one cent.

Looking Forward: Analysts seem more negative about the company’s results for the next quarter than ninety days ago. The average estimate for the third quarter has moved from a loss of one cent a share to a loss of 2 cents over the last ninety days. Down from a loss of 6 cents per share ninety days ago, the average estimate for the fiscal year is now a loss of 7 cents.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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