Energy Research Corporation Presents Fuel Cell Commercialization Achievements and Evercel, Inc.
DANBURY, CT (April 1) BUSINESS WIRE -April 1, 1999--Energy Research Corporation (AMEX: ERC) held its annual meeting yesterday at the American Stock Exchange. Jerry Leitman, President and CEO discussed ERC's significant achievements in 1998 and unveiled the Company's focus for this year and the next. He also highlighted the achievements of Evercel, Inc., a Company recently spun off to ERC shareholders. Trading in Evercel stock is expected to begin April 6, 1999 on the Nasdaq SmallCap Market with the symbol EVRC.
Mr. Leitman commented on the Company's 1998 financial highlights. "While revenues in 1998 declined slightly from 1997, we continued our investment in technology development and commercialization, which, including our partner's share, now totals over $400 million since 1990. On a pro forma basis, excluding the non-recurring costs of Evercel, we continued our string of profitability since the IPO in 1992." Fuel Cell Achievements
ERC's fuel cell achievements include expanding product lines by cross licensing with the MTU subsidiary of DaimlerChrysler (DCX), ERC's European partner. The cross license expands the company's product portfolio to include both sub-megawatt and megawatt class products. All European and North American fuel cell stacks resulting from the cross licensing continue to be manufactured at the ERC Torrington, Connecticut plant.
Two key technology development milestones for commercialization in 1998 include the 10 kW stack endurance test started in April, 1998 which has generated over 8200 hours of electricity, and the manufacture of the commercial Direct Fuel Cell stack now producing electric power for the ERC Danbury plant.
In addition, MTU, ERC's European partner, announced last year that it had received a contract for a commercial field trial of the 250 kW "Hot Module" unit at Statwerk Bielefeld, Germany with startup expected in late summer 1999.
Finally, in 1998, Direct Fuel Cell marine application activities were expanded, with ERC receiving a significant additional contract from the US Navy for $3 million, making the total contract about $5 million, as well as a contract from the Coast Guard for $500,000. Commercial Sales
The primary focus for ERC this year and next is to take the actions necessary to initiate commercial sales in 2001. ERC commissioned on March 18, 1999 the DFC power plant at the Danbury facility, which successfully demonstrates product operability. The Danbury unit provides 250 kW of electricity for ERC's Research and Development facility, with the excess being fed into the grid. Commercial Field Trials
ERC anticipates siting commercial field trials of both the 250 kW and megawatt class Direct Fuel Cell power plants in the U.S. ERC's European partner, MTU, will be doing the same in Europe. Mitsubishi Electric, ERC's Asian partner, is expected to start a 200 kW power plant late this year at the Kansai Electric facility in Japan. Strategic Partnerships
Near term, a key priority for ERC will be to develop additional strategic partnerships. ERC intends to focus on its core competency of fuel cell technology and manufacturing, and develop partners for component supply, equipment packaging, marketing and distribution, operations and maintenance, and project finance. To date, strategic partners are MTU/DaimlerChrysler for Europe, Mitsubishi Electric for Asia and Duke/Fluor Daniel for design of balance-of-plant. Evercel, Inc. Spin-Off
Evercel, Inc. will begin trading on April 6, 1999 on the Nasdaq SmallCap Market with the symbol EVRC. China Production
Evercel's strategic alliances include a joint venture between Formosa Plastics Group and Xiamen Three Circles Co., Ltd. The joint venture is licensed to use Evercel's nickel-zinc batteries for electric and hybrid electric vehicles. The license includes a $1.5 million up front payment, payments of $3.5 million in stages, and royalties on commercial sales.
Also, ERC formed a joint venture with Xiamen Three Circles Co., Ltd. and licensed the joint venture to manufacture batteries for bicycles, scooters and other applications for sale in China, Southeast Asia and for export to North America.
The joint venture battery production facility is expected to start production in the summer 1999 in newly leased space of 30,000 square feet. Performance
The nickel-zinc battery was tested in two different electric vehicles and performance exceeded the range of lead-acid batteries by a factor of 2 1/2 to 1. 1999 Evercel Focus
Evercel intends to move in to its small-scale production facility in Danbury, Connecticut in April and anticipates commencing larger scale battery production in China in July. Key priorities for Evercel will be to commence initial battery sales, and select additional strategic partners in Asia, Europe and North America. Summary
ERC believes both products - fuel cells and nickel-zinc batteries - are on their commercialization launch pads and are value-added products for the global marketplace. Major activity is expected during the next 6 to 18 months in their commercialization process.
Energy Research Corporation located in Danbury, Connecticut, is an internationally recognized leader in the field of electrochemical technology for electric power generation. ERC is developing its Direct Fuel Cells through funding from and in cooperation with government, electric utility, and major international industrial organizations. Evercel, Inc. specializes in battery technology especially the nickel-zinc battery for high performance, high drain, and rechargeable applications.
This press release contains forward-looking statements, including statements regarding ERC's and Evercel's plans and expectations regarding the development and commercialization of their fuel cell and battery technologies. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that could cause such a difference include, without limitation, the risk that ERC's Direct Fuel Cell Power Plant will not operate as efficiently as planned, the risk that ERC's or MTU's commercial field trials will not be conducted as anticipated, the risk that ERC and Evercel will not initiate commercial sales as currently scheduled, the risk that ERC's and Evercel's manufacturing capacity will not be increased as planned, general risks associated with product development, manufacturing and introduction, changes in the utility regulatory environment, potential volatility of energy prices, rapid technological change, and competition, as well as other risks set forth in ERC's and Evercel's filings with the Securities and Exchange Commission. The forward-looking statements contained herein speak only as of the date of this press release. ERC and Evercel expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statement to reflect any change in ERC's and Evercel's expectations of any change in events, conditions or circumstances on which any such statement is based.
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CONTACT: Johnnie D. Johnson
Strategic IR, (212) 391-4868
E-mail: attiya@aol.com
or
Joseph G. Mahler
Energy Research Corp.
(203) 825-6000
E-mail: erc!jmahler@attmail.com
KEYWORD: CONNECTICUT
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS UTILITIES CHEMICALS/PLASTICS
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