Mechanical Technology Incorporated
First Quarter – 2020 Highlights
- Revenue for the first quarter of 2020 at MTI Instruments was $63,000, or 4%, less than last year. This decline was attributed to the sale of a $118,000 semi-automated wafer metrology tool during the first quarter of 2019, while there were no semi-automated wafer metrology tool sales during the first quarter of 2020. This quarter-to-quarter variance was partially offset by an increase in military sales of our engine vibration and balancing systems.
- MTI’s newest subsidiary, EcoChain Inc., was created in January 2020 and has launched the initial steps to develop its first cryptocurrency mining operation. The detailed business plan associated with the pilot mine program, which is expected to be operational later this year, was developed by Soluna Technologies and approved by the MTI Board of Directors in March 2020. This prompted a subsequent $250,000 additional investment by MTI in Class A preferred shares of Soluna pursuant to the January 2020 Share Purchase Agreement.
- For the first quarter of 2020, MTI reported an operating loss $142,000, which was $223,000 less than the operating income reported last year. Increased staffing in marketing and sales at MTI Instruments contributed to $120,000 in additional selling expenses compared to 2019. Further contributing to the first quarter loss were one-time legal fees associated with the investment in Soluna and the formation of EcoChain totaling $72,000, as well as a $65,000 management fee paid in conjunction with the pilot cryptocurrency mining operation.
- On March 4, 2020, the Company filed a Form 10 Registration Statement with the Securities and Exchange Commission to register its common stock under Section 12 of the Securities Exchange Act of 1934. Upon the Form 10 becoming effective, the Company would once again have been subject to SEC reporting requirements. On April 3, 2020, the Company submitted a request to the SEC to withdraw this registration statement. At that time, the Company’s Board of Directors determined that based on recent market and economic disruptions caused by the COVID-19 pandemic, that the registration of the Company’s common stock under the Securities Exchange Act was not advisable and not currently in the best interests of the Company and its shareholders. The Company may file a new Form 10 to register its common stock at a later date should the Board of Directors determine that such action is then advisable.
- Like nearly every business in the United States, MTI is dealing with adversities connected with the COVID-19 global pandemic; notably for us the challenges associated with social distancing and working from home while still being responsive to our customers. As this crisis continues, uncertainties remain as to how and when both the U.S. and world economies will rebound and any near-term impact this could have on MTI. However, thanks to the hard work and resiliency of the MTI Instruments team, exceptional guidance from MTI leadership and strong support from the MTI Board of Directors, the Company, at this time, does not believe that the COVID-19 pandemic will have a material, long-term impact to our business and financial results.
MTI Investor Relations