What’s up with Altair Nanotechnologies (ATLI)?
In the nano hype of 2004, one much talked about company was Altair Nanotechnologies (NASDAQ:ALTI). In 2002, Josh Wolfe characterized Altair as a “nano pretender” stating that Altair “had changed names more often than Oprah’s clothes”. In a follow up article 5 years later, Josh noted the restructuring of the company in 2006 and their move towards commercializing high-power batteries making the company a real player in the nano-enabled battery market.
Trading since 1997, Nevada based Altair Nanotechnologies has had many focuses over the years. In 2003 the company’s stated focus was in production of titanium dioxide pigments and structures, a pharmaceutical called Renazorb, and the development of nanomaterials across various product applications. In 2009 the company organized itself into two divisions; Power and Energy Group and an All Other division. The All Other consisted at that time primarily of the development of an itanium dioxide pigment for paint and coatings in a joint venture with Sherwin Williams. In the past several months the company has appointed both a new CEO and CFO. In July 2011, Energy Storage (China), a subsidiary of Canon acquired 53% of ALTI’s outstanding shares. As of December 2012 the company had 90 employees, 20 of whom are in China. The company has a current market cap of around $36 million.
Markets and Technology
In the latest 10-K, Altair characterizes itself as a company that develops, manufactures and sells nano lithium titanate batteries and energy storage systems. These systems address three target markets. Firstly, the electric grid in which they design, manufacture and sell grid-scale battery systems. Secondly the medium- to heavy-duty electric vehicle market. Thirdly, industrial in which they intend to supply batteries and battery systems for use in different industrial applications. ALTI’s nano lithium titanate battery cells are stated to offer 4 to 10 times greater life than conventional lithium-ion technologies. The battery cells are capable of recharge times of 10 minutes to 95% or more of initial battery capacity which important in their target markets. ALTI has been awarded a total of 12 U.S. and 42 foreign patents with a total of 7 U.S. and 37 foreign patent applications pending. The Company has leased land in China with the intent of moving their entire manufacturing operations overseas. Altair is currently building a 136,760 square foot nano lithium titanate production facility and a 130,200 square foot assembly facility for battery modules and energy storage systems. The project is expected to reach completion in Q3 2013.
Over time the share price has performed dismally, characterized by volatile swings. Investors who would have purchased shares in ALTI when they first started trading would have lost nearly 94 percent of their original investment. Year-to-date performance however has been strong with the stock price increasing over 66 percent.
One driver for this increase in share price may be 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. Nearly all of these revenues were derived from the Power and Energy Group division. In the last trading session, ALTI closed up around 12% on unusually heavy volume.
In an upcoming article we will take a closer look at the source of ALTI’s massive surges in revenues for 2013 and try to determine if this growth is sustainable in the coming years.