IRVINE, Calif., May 22, 2012 /PRNewswire/ -- Quantum Fuel Systems Technologies Worldwide, Inc. (QTWW) (the "Company") (NASDAQ: QTWW), a global leader in natural gas, hydrogen and hybrid/electric vehicle technologies, is providing an update on the near term direction and focus of the Company following recent executive management changes.
At a board meeting held on May 10, 2012, issues of direction, focus, execution and cost structure were addressed. Following discussion on these matters, the board accepted the resignations of the former Chairman and CEO, as was reported in a press release the following day. The board members want to assure stakeholders that they (i) are enthusiastic about the Company's opportunities, technology and asset mix, and (ii) have full confidence in the new leadership team to execute on the Company's near-term direction, which is to grow, expand and enhance the Company's core automotive products and technologies, reduce its operating costs in an effort to restore confidence, as well as rebuild and grow stockholder value. The board does not expect recent executive management changes to have an adverse effect on existing customer and supplier relationships, contracts, or significant opportunities before the Company.
As a sign of the board's and management's commitment to this renewed vision, direction and focus, members of the Company's management team and board of directors have recently purchased shares of the Company's common stock on the open market.
The Company aims to grow, expand and enhance its profile as a technology leader in the alternative fuel automotive sectors by investing in the expansion of its manufacturing capacity for compressed natural gas and hydrogen storage systems, as well as directing additional resources toward the sale and marketing of its advanced energy storage and hybrid/electric propulsion systems products and technologies.
The Company plans to make strategic assessments of its renewable energy projects and minority-owned investments which lie outside of the Company's core automotive technology focus, including reviewing opportunities for accretive investments that require minimal capital commitment by the Company.
In addition, the new leadership team will aggressively seek to reduce operating costs, particularly corporate, general and administrative expenses, through a variety of cost-cutting initiatives, some of which have already been implemented in full or in part, including executive attrition and salary reductions, consolidation of facilities, and reductions in board of directors' fees.
The Company anticipates that operating costs can improve by approximately $4.1 million on an annual basis after the actions described below, along with other cost reduction initiatives, are fully implemented, which is expected to occur over the next six to twelve months.
In connection with its cost reduction initiatives, the Company believes it can:
- Save approximately $2.1 million annually through executive attrition and salary reductions, eliminating unnecessary and/or duplicative administrative expenses and streamlining its organizational structure.
- Reduce its leased facility expenses by relocating its executive management team and corporate support personnel currently located in the Company's Irvine, California, facility to the Company's Advanced Technologies Facility located in Lake Forest, California, and executing on pathways to exit or sublet the existing longterm lease on the Irvine facility. The elimination of underutilized facilities could save approximately $1.4 million annually.
- Realize substantial savings from fees charged by its professional service providers and advisors, including approximately $0.4 million in decreased annual audit fees due to the Company's change in independent auditors that was implemented in calendar 2011 with the full effect expected to be realized in the remainder of 2012.
- Realize cash savings of approximately $0.1 million annually related to fees paid to its board of directors resulting from reducing the size of the board of directors from 7 members to 5 members and the board's unanimous agreement to reduce the cash portion of their annual retainer and meeting fees by 30%, both of which were implemented on May 10, 2012, in connection with the resignation of two directors.
"These actions are in full alignment with the commitment of the Company's new leadership and board to focus resources on our automotive-based products and technologies and to reach profitability sooner as we drive growth of the business," said Brian Olson, CEO of Quantum. "Today's announcement demonstrates our resolve to manage our cost structure in an effective manner going forward, with significant strides toward this end made already and additional opportunities going forward."
"The board and our new management team have unanimously agreed and proposed this plan to improve the sustainability of the business," said Dr. Scott Samuelsen, Independent Board Member. "It is imperative that we focus on our core business strengths, grow the business and reduce costs in a smart and efficient manner."
Quantum Fuel Systems Technologies Worldwide, Inc. is a leader in the development and production of advanced vehicle propulsion systems, fuel storage technologies, and alternative fuel vehicles. The Company's portfolio of technologies includes electronic and software controls, hybrid electric drive systems, natural gas and hydrogen storage and metering systems and other alternative fuel technologies and solutions that enable fuel efficient, low emission hybrid, plug-in hybrid electric, fuel cell, and natural gas vehicles. The Company's powertrain engineering, system integration, vehicle manufacturing, and assembly capabilities provide fast-to-market solutions to support the production of hybrid and plug-in hybrid, hydrogen-powered hybrid, fuel cell, natural gas, and specialty vehicles, as well as modular, transportable hydrogen refueling stations. The Company's customer base includes automotive OEMs, fleets, aerospace industry, military and other governmental agencies, and other strategic alliance partners. The Company's wholly owned subsidiary, Schneider Power Inc., and affiliate, Asola Solarpower GmbH, complement the Company's alternative and renewable energy presence through the development and ownership of wind and solar farms, and the manufacture of high efficiency solar modules for traditional and automotive applications. Quantum is headquartered in Irvine, California, and has operations and affiliations in the USA, Canada, Germany and India.
Forward Looking Statements:
This press release contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements included in this report, other than those that are historical, are forward-looking statements and can generally be identified by words such as "may," "could," "will," "should," "assume," "expect," "anticipate," "plan," "intend," "believe," "predict," "estimate," "forecast," "outlook," "potential," or "continue," or the negative of these terms, and other comparable terminology. Examples of forward-looking statements contained in this press release include the amount that the Company can save from its cost cutting initiatives, the Company's intent to grow, expand and enhance its core automotive products and technologies, the Company's belief that the recent executive management changes will not have an adverse effect on the Company's relationship with its customers and suppliers, and the Company's belief that it can achieve profitability sooner by focusing its resources on its automotive-based products and technologies. Various risks and other factors could cause actual results, and actual events that occur, to differ materially from those contemplated by the forward looking statements, including whether Company executives will renegotiate their salary, whether the Company can sublet or exit its Irvine, California lease, whether the level of audit and other professional services rendered exceeds the level currently contemplated, whether the Company's customers and suppliers believe the Company can perform on its contracts under the new executive management team and whether other factors not currently contemplated arise that impact the Company's operating costs. The Company undertakes no obligation to update the information in this press release to reflect events or circumstances after the date hereof or to reflect the occurrence of anticipated or unanticipated events.
More information can be found about the products and services of Quantum and Schneider Power at http://www.qtww.com/ or you may contact:
Brion D. Tanous
Principal, CleanTech IR, Inc.
©2012 Quantum Fuel Systems Technologies Worldwide, Inc.
Advanced Technology Center
17872 Cartwright Road, Irvine, CA 92614
Phone 949-399-4500 Fax 949-399-4600
SOURCE Quantum Fuel Systems Technologies Worldwide, Inc.