Tuesday, October 16, 2012

A123 Systems, Inc. (NASDAQ:AONE) Tumbles on Bankruptcy, Basic Energy (NYSE:BAS) Trims outlook

Shares of Basic Energy Services, Inc(NYSE:BAS) rose 18 cents, or 1.59 percent, to $11.48. Lowering the third quarter revenue forecast was the company with a weaker than expected September results.

The company received a subpoena from the Securities and Exchange Commission on Monday. In a regulatory filing the company said that SEC is investigating whether there is any violation of federal security laws while reporting its June operating data. The company plans to fully cooperate with the SEC inquiry.
Maintaining the guidance for the fourth quarter revenue to fall 3 to 5 percent, it changed its third quarter revenue outlook. It expects to drop 5 to 6 percent from second quarter and increase from its previous forecast drop of 3 percent.

Moreover the rig utilization rate even dropped because of fewer working days and inclusion of the Labor Day holiday.

Further there was a decline in drilling rig days for September because of delay at some of its rigs and majorly because it used one of its rig on internal project.

A123 Systems, Inc.(NASDAQ:AONE) on Tuesday filed for bankruptcy protection and sold its automotive assets following short of cash and weak sales of electric cars.

The news came a day after the company alerted of its miss in debt payments and that it could be head for restructuring under Chapter 11. The company is yet to post profit and has lost $83 million in second quarter. Just two months ago did the company announced of a $450 million lifeline from Wanxiang Group Corp which it now terms to be over.

Under chapter11 the company received a federal grant of $249 million which it is not required to repay but has to match it. Till date it has drawn about $129 million of the grant said spokesman Dan Borgasano.

Johnson Controls will get A123's automotive assets for $125 million, including lithium-ion battery technology, products and customer contacts. It will also take over the factories in Michigan, cathode ray factories in China and an equity interest in a Chinese battery company.

The business such as grid, commercial, government and other operations which were not purchased by Johnson Controls are under process to be sold said A123.

A123's stock once traded for more than $20 on the day of its initial public offering in 2009 fell to 6 cents in afternoon trading down 75%.

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