ALTI Key Customers and Products

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In a recent article, we highlighted Altair Nanotechnologies (NASDAQ:ALTI), a company that over time has narrowed the focus of their business operations to “Power and Energy” in which they develop, manufacture and sell nano lithium titanate batteries and energy storage systems. The stock has garnered some attention as of late and was up +36%  in the last trading session on 10 times normal share volume. In this article, we will take a look at their flagship product and key customers.

The ALTI-ESS

The company’s flagship product is the Altairnano Energy Storage System (ALTI-ESS) which is a power module(s) consisting of a 1.0-megawatt battery pack and battery management system, fire suppression equipment and thermal-management system, which is housed in a standard 53-foot shipping container. These module(s) are supported by a power control system as seen below:

Source: Altair Nanotechnologies
Source: Altair Nanotechnologies

The system helps utility and independent system operators respond to rapid and unexpected fluctuations in electricity generation. With a growing proportion of energy production being supplied by renewable energy such as solar and wind, the demand for rapid and flexible power regulation capacity to assure grid stability is only expected to increase.

Key Customers

A notable change in the financials for ALTI is the 800% increase in revenues to around $5 million for the 6 months ended June 30, 2013, compared to the same period in the prior year of around $600 thousand in revenues. All of these revenues were derived from the “Power and Energy” division with only $120 thousand recorded as a “licensing fee”. Of the $5 million in revenues, 43% came from a single customer, Hawaiian Electric Light Company (HELC),  which serves 95% of the state’s 1.2 million residents. ALTI has three ALTI-ESS systems in progress with HELC. The first is a 1-megawatt system built in 2012 and commissioned in March 2013. The second is a 1-megawatt system said to be commissioned in the first quarter of 2014. The third is a new 2-megawatt ALTI-ESS Advantage system that HELC ordered in January 2013 with installation scheduled to take place in early-2014. ALTI’s second key customer this year is Vestas. An additional 29% of 2013 revenues so far this year were from a fully commissioned 1.2-megawatt system built for Vestas Wind Systems, which is being used to integrate wind power at a wind farm in Denmark. This system was fully commissioned and paid for in March 2013.

While these two customers, HELC and Veritas, represented a cumulative 69% of ALTI’s total revenues this year, they have also leased a 1.8 megawatt system to Energy Storage Holdings, LLC which is currently in operation and built a 2 megawatt system for TSK Solar which is expected to be commissioned in the third quarter of 2013. In an upcoming article, we will take a look at ALTI’s move into providing batteries for electric vehicles along with their expansion into China.

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