Good day, everyone, and welcome to the AMSC Conference Call. This call is being recorded. [Operator Instructions] With us on the call this morning are AMSC President and CEO, Daniel McGahn; Senior Vice President and CFO, David Henry; and Senior Manager, Corporate Communications, Kerry Farrell. For opening remarks, I would like to turn the call over to Ms. Kerry Farrell. Please go ahead, ma'am.

Thank you, Lori, and welcome to our call to discuss our fourth quarter fiscal 2013 results. Before we begin, I'd like to note that various remarks management may make on this conference call about AMSC's future expectations, plans and prospects constitute forward-looking statements for the purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including those discussed in the Risk Factor section of our Annual Report on Form 10-K for the year ended March 31, 2014, which was filed with the SEC today. These forward-looking statements represent our expectations only as of today and should not be relied upon as representing our views as of any date subsequent to today. While AMSC anticipates that subsequent events and developments may cause the company's views to change, we specifically disclaim any obligation to update these forward-looking statements. I also would like to note that we will be referring on today's call to non-GAAP net loss or net loss before adverse purchase commitments, recoveries, losses, net stock-based compensation, amortization of acquisition-related intangibles, restructuring and impairment charges, Sinovel litigation costs, cost contingency per shareholder litigation, consumption of 0 cost-basis inventory, prepaid VAT reserve, noncash interest expense, change in fair value of derivatives and warrants and loss of extinguishment of debt, net of any tax effects related to these items. Non-GAAP net loss is a non-GAAP financial metric. A reconciliation of our non-GAAP to GAAP net loss can be found in the press release we issued and filed with the SEC this morning. All of our press releases and SEC filings can be accessed from the Investors Page of our website at www.amsc.com. And now, I will turn the call over to CEO, Dan McGahn. Dan?

Thanks, Kerry, and good morning everyone. I'll begin today by providing an overview of results, actions and accomplishments during fiscal year 2013, as well as our objectives for 2014 and beyond. Dave will then review our financial results in detail and provide guidance for the first fiscal quarter, as well as full fiscal year 2014. Following Dave's comments, I'll provide an update to our business outlook. And after that, we'll open up the line to your questions. Revenues remain relatively flat in fiscal year 2013 compared with fiscal year 2012. Looking at the business units, the Wind business grew by 26% in fiscal 2013. The higher Wind revenue was offset by lower Grid revenue. Grid sales were impacted by macro factors in our primary D-VAR markets, with the largest impact coming from Australia. I will talk more about that later. In fiscal 2013 we reduced our operating expenses and net loss and decreased our cash burn, even on flat revenue. Year-over-year, our cash balance, including restricted cash, decreased by less than $1 million. We stabilized our cash position, reducing our burn from operations by 71% in fiscal 2013 as compared with fiscal 2012. Additionally, in the fourth quarter of fiscal 2013, we generated positive operating cash flows, mostly from working capital, the first time since fiscal year 2010. We grew our cash balance sequentially quarter-to-quarter, even after backing out cash received from financing activities. As a result, we are focused on positioning the company for future growth. We expect fiscal 2014 to be an inflection year, as we position ourselves for revenue growth in 2015 and beyond. We have identified 3 discrete business events that we expect to occur in fiscal year 2014, that we feel are key catalysts to position the company towards our objective of driving future revenue…

Thanks, Dan, and good morning, everyone. AMSC generated $16.3 million in revenues for the fourth fiscal quarter compared to $20.4 million in the year ago quarter. In the fourth fiscal quarter, Wind revenue grew by 42% year-over-year, due primarily to higher shipments to Inox. This growth was offset by a decline in revenue in our Grid business, due primarily to lower D-VAR revenue. For the full fiscal year, we generated revenues of $84.1 million compared to $87.4 million in fiscal year 2012. Wind revenues increased 26% year-over-year, while Grid revenues decreased 34%, due primarily to the factors I just mentioned. The 12-month backlog as of March 31, 2014, was approximately $35 million compared with $43 million as of December 31, 2013. The 12-month backlog number I just mentioned does not include the Inox order that we announced this morning. In the Wind business, we continue to ship off backlogs under longer-term contracts. We have nearly completed deliveries to Inox under the current contracts, and we expect to begin shipments under the order that we announced today during the second quarter of fiscal 2014. We expect to complete shipments during calendar year 2015. In the Grid business, D-VAR bookings continue to be soft. We are seeing some positive signs of a potential recovery. As in Wind, in superconductors, our revenues are primarily derived from longer-term contracts. We expect that near-term opportunities for new orders are for our REG product and our degaussing system for the U.S. Navy. Dan will talk more about those opportunities. Looking at the P&L in more detail, gross margins for the fourth fiscal quarter was a negative 1%, which compares with 11.4% in the fourth quarter of fiscal 2012 and 22.9% in the previous quarter. The sequential decrease in gross margin is primarily due to 100% margin…

Thanks, Dave. Let's start first by talking about the REG system, its benefits, competitive advantages and why we believe it's representative of the future potential of AMSC. REG represents what AMSC will be in the coming years. The REG system solution demonstrates a fundamental shift into our strategy around superconductors. Previously, we've been focused on increasing wire sales and using volume to decrease cost. With the REG system we will be selling a full system solution, providing revenues in multiples of the wire value. This means that we need to sell less wire for our superconductor base product line to contribute to profitability. Let me back up and talk to you about the REG system and its benefit to a utility. The REG system enhances capacity, reliability or some combination of the 2 in the urban electricity grid. And it will ultimately make the grid more resilient. There is a compelling need for such solutions in the market today. To understand the benefits of the REG system, it is helpful to have an understanding of how the electric power grid works. In a typical urban electricity grid infrastructure, power is produced at power plants that are located outside of the city limits. Power from those plants travel through high-voltage transmission lines and transmission substations until it reaches a distribution substation where the power is stepped down to distribution voltages. This enables safe voltages to be brought to homes and businesses. Because power must pass through these substations before being delivered to homes and businesses within the city, they play a critical role in the urban electrical infrastructure. These are the key nodes on the network that are the electrical life line to power business and our activities in our home. Each substation supplies power to an entire section of a…

[Operator Instructions] And we'll go first to Carter Driscoll with MLV & Co.

First question, Dan, you spent a lot of time talking about the REG product and your expectations for potentially receiving order in the next fiscal year. Can you talk about what components -- how this product is different than your stand-alone fault current limiter that you have out in the market today? I mean, is it built upon that, which is what I'm assuming? And just talk about what other component for maybe $1.00 content perspective, you can compare and contrast that with the stand-alone product?

Okay, so the stand-alone product is different. This is a product that we've worked in collaboration with Nexans on, and they're actively marketing it in Europe. We're actively marketing it here in the United States. And what that is, is basically a box that sits inside a substation. And what it will do is it will manage locally the ability for that substation to deal with fault currents that it would see. So it solves a specific problem on a specific part of the grid. REG, in many ways, is fundamentally different. What we're trying to do is to link the nodes in the network that already exist to allow them to be able to move, not only capacity, but also improve reliability, and thus resiliency. The way that resilient electric grid works is it gets down to the construction of the wire. This is something that's very unique to AMSC in how we make our wire. We're the only company in the world that makes it this way because of our significant patent position. So we see REG from a dollar standpoint as being potentially transformative. So you're talking about projects that are in the order of tens of millions of dollars as opposed to selling boxes that are on the order of millions of dollars, just to give you a sense. But the value that the market is going to see is demonstrably different. You're talking about substation upgrade deferral. You're talking about new substation build elimination. So the economics aren't just about fault current management like a stand-alone fault current limiter would be, but it's really bringing more to the existing systems. And where we're going to compete is with other major capital purchases that the utility would make. How do we think about the system from a capacity and from a reliability standpoint and what on an annual basis is utility going to invest in. And what we believe in REG is they have a choice now to basically network the nodes within the distribution system in a way that enhances both capacity and reliability. Did that help?

Okay. So if I -- yes, no, that's excellent. So just let me drill down a little bit more deeply. If I heard you correctly, you said that you're hoping to get an order that you would fulfill over some 12 to 18 months timeframe after receiving the order that might equal the current value of your revenues you just booked ending the March quarter. And if that is correct, first of all, then how many substations would that encompass or -- and you talked about the elimination of a newbuild, but kind of give us an idea of like maybe the geographic size of what the deployment might look like?

Sure. So to give you a sense, when we look at the value proposition, and again, I think the way you framed it was interesting that a stand-alone -- and to think about a stand-alone fault current is to -- a stand-alone fault current limiter is to current almost what a D-VAR is to voltage. It's going to solve a specific problem in a specific location on the grid. Both necessary, both interesting markets, both potentially nice businesses for us. When you look at resilient electric grid, it's really about connecting those substations. So if I imagine 2 or 3 substations and they have 50% or really 100% redundancies, so 50% of the capital deployed is really not active in normal state. You're now able to make a decision, do I build another substation, do I upgrade these existing substations? And you're talking about cost benefit. It's on that large order of tens of millions of revenue. So when you think about a market and you think about projects, did I say quarterly? Yes. So let me correct, I'm saying annual revenue, not quarterly revenue in the numbers that I'm stating. When you think about a deployment, you probably do a project in a city. It won't complete everything that city needs to do, so it could be a first step in improving reliability or capacity in that city, and it would be connecting, really, 2 or more substations together. Ideally, the more that the distribution network gets networked, meaning, the more substations that are included in the deployment, the more un-trapped, the more getting at that trapped capacity happens for more parts of the city, but also you substantially increase reliability. And in today's climate, with the storms that we've seen, with bombings that we've seen, with events that we saw out in California with somebody shooting up a substation, this is really top of mind at utilities. It's top of mind with NERC and FERC and the ISOs, and everybody involved, that there needs to be a way to think about enhancing reliability of critical infrastructure. And that's really why DHS is so supportive of this is that's right in the crosshairs of their objective and their mandate and what they're about.

Okay. And given your customer target base, I mean, it seems more likely 2 or maybe 3 of the substations will be linked at first, and they're not going to do a whole city-wide swap-out, but I think that makes a lot of sense. How about regulated versus...

[indiscernible] you could have as many 20, 50 substation in it. So you wouldn't go and you wouldn't do all of that at once. But once you get that first order, what I'm trying to get at it is there's the potential for follow orders -- follow-on orders even within that city.

Yes, yes, that make sense. Is there more recept-ance from the regulated versus the unregulated utilities? Does it make a difference?

I don't do think it necessarily makes a difference. Really, it's about size and it's about what their current issues are. If they currently have a reliability concern or they currently have a capacity need, then they're right in the near-term as an opportunity for us for REG.

Fair enough. Switching gears a little bit. Inox, can you maybe talk about what glitch they have in terms of -- is it a capacity constraint? Is it some other issue as to why there's the kind of near-term at least for the -- for next quarter?

Carter, this is Dave. They had a -- they -- this was in the press. A little bit ago they had a fire at one of their blade manufacturing facilities, and so they've had to deal with that, and that's constrained their overall production of it, and there...

It's a tough time of the year to come at for this to happen to them, because as we were kind of talking about in the macro environment, their year really got shortened to 6 months. So the first half of the year because the policy wasn't established. They couldn't do a whole lot in the market. So they were going gangbusters as fast as they could in the second half of the year, which ends the end of March. And to have this issue with capacity on the blade side, we're going to see an impact, and that's why in what Dave was saying, we see that impact coming to us here in the next time period.

Okay. But do you expect any revenue from them in the June quarter or is it just a kind of reduced figure or maybe will get up and running in the latter part?

No. We do expect revenue from them in the first quarter.

Okay. And a follow-on offering -- excuse me, a follow-on order, did you -- did I hear you correctly that it's not included in the 12 months backlog?

It's not included in the backlog number that we reported. That backlog, that was as of March 31.

Right, okay, great. Can you talk about, Dan or Dave, maybe the approval process for the Navy contract, like the different types of departments you have to go through, and I'm assuming it's a multiple stage process and you guys have been talking about this order for a while, and it certainly has quite a bit of a potential upside if you can move it to a different platforms, but maybe just talk specifically about some of the departments that you have to get approval from to get across the finish line?

Sure. So I think what we've been talking really about is the product development. We've talked about the successful sea trials. This is something that the Navy really wants. Where we're at today is a stage where what we're anticipating at some point in the near-term here is for the Navy to direct the shipbuilder to make an engineering change. So we're focused today on ships that are already scheduled to be built but have not yet been built, and what we would be is an engineering change in the system. So they would go from the traditional way that they do degaussing to what the Navy calls advanced degaussing, which includes us. In order for that to happen, it really happens platform by platform, so ship by ship, where, say, it's a destroyer or say it's one of the faster ships, that program makes a decision. We're going to do a cutover on what the timetable is. What we're awaiting now, really, is that instruction directly to the shipbuilder on here's what we want you to do and when we want you to do it, and around that would then come out an order to us to procure the equipment.

Okay, okay. Back to maybe the JCNE, they -- you said they got certification for the 3-megawatt turbine for LVRT, and that they are continuing to work down, I'm assuming, really the inventory issues on the 2-megawatt side. Could you talk about the contract that they did win with another power producers? If you can't name them, and talk about what it -- how that might filter through to your particular business?

Sure. So let me talk first about the product lines. So where we've been and what we ship to date are really around the 2-megawatt. When we originally signed the technology transfer part of the relationship, there's a 2, a 3 and a 5.5 coming. We have announced previously with the 3. We've gotten the prototype that started to get into production, had to get through testing and really those testing with LVRT now opens up the ability for JCNE to expand their product line, not only to the 2, but also 3. We're also -- continue to work with them on a 5.5-megawatt, and we hope for that to go into production here sometime in the near term. When we think about their business, we've talked a lot about them having these 2 divisions. So they have a division that makes the wind turbine, and then they have a division that develops the wind farm. And what we're seeing now is the ability to generate business outside that model, and really sell to the large power producers. So in the state grid system, there's 5 major power producers and one of them, which is one of the bigger ones, has elected to do really a significant size and I don't want to get into numbers because we're sensitive with JCNE and with the information, but a significant sized wind farm. And what that means now is they can sell outside their traditional model of developing the full asset, but also have this parallel business on selling to the large power companies. It's not much different than how Inox started. So Inox developed their business the same way. They had these 2 divisions, one making the wind turbine and then another one making the wind farm. And as they started to get experience basis with that, they were then able to sell to the overall market and that's why you see the growth of Inox going from 2% to 12%, 13%, 15%, whatever it was that they delivered this year because now they're selling to the overall market. The fact that they're selling the full wind farm means that they have to fully understand all of their customers' issues. Inox has gone through that learning. This means that JCNE will be going through that learning, and it really opens up the larger market in China to JCNE.

Okay. Maybe 2 last questions if I may. Can you talk about the -- has there been any changes in the Korean market? Obviously, you partner with Hyundai and Doosan, and maybe talk about where the offshore project stands in terms of your expectations, and then I have one last follow-up.

Yes, I think Korea, their sites have really turned domestically on offshore. There's projects there that are kind of in the beginning of underway stages. There's a utility scale launch of offshore winds. Really, it's now expected to be after 2015. They're going through a demonstration phase now, which is on the order of about 100-megawatt wind farm. There's 4 major suppliers. We have 2, and we see our products as being uniquely competitive in that market. So we had to -- I guess we benefited from the speed of China in our past, and I think we're going to benefit from the slowness of Korea in that these guys are going to get it right. They're going to have products that aren't just going to work in Korea, but they're going to work globally. And they do have a strong partnership with their government, but it means it's going to move that governmental speed in Korea. And in the short term, you can maybe we suffered from that. But in the long term, we believe there's a market for offshore for our partners in Korea, but also globally. We think that the products that they deploy in Korea will be immediately transferable to the global market, and probably will be in a very unique competitive way. There's a rich tradition in the Maritimes in South Korea in building ships and offshore structures that we believe will help the overall offshore wind market.

And that demonstration project is it -- what is the turbine rating being used?

Anywhere from 3 to really 5, and I think that Samsung announced at one point they’re trying to do a 7. I don't know the progress with that, if they've really been able to make it. But we have a 3 with Doosan. We have a 5.5 with Hyundai, and they're really the furthest along and the most mature at those size ratings.

And then just my last question, maybe from a regulatory perspective, obviously, the expiration of the PTC in the U.S., maybe -- a different impact from you is more indirectly than direct, but give me your view and your expectations of whether that has a chance of being either retroactively applied or even getting reinstated, maybe, say, midyear and just giving your viewpoint?

Yes, I think what we -- to kind of link it directly to our business, for the U.S. wind market, really, it's about D-VAR for us. Some of our partners have done projects in the U.S., but they're not substantial for them and they're not substantial for us. Really, what we see is kind of a push out in the market. We've talked about in the remarks. I think about 1 gigawatt was done last year. There's about 13 that's in construction this year. So there is some pent-up demand. I think going forward, beyond the expiration of the PTC, I mean, they've looked at renewing it a number of times in the past. They've gotten to the point where they did this renewal back a year or so ago. What we're trying to focus on now are really the utility and the industrial demand, and we see utility demand in North America in the U.S., and we see industrial demand in North America, particularly in Canada. So what we're try to do is to further insulate the business, I don't want to say away from wind because we support wind, but particularly when we look at the D-VAR markets, North America, the U.K. and Australia, we're try to spend a lot of our efforts in selling utility and industrial solutions as opposed to only renewables.

That does conclude our question-and-answer session. I'd like to turn the call to Dan McGahn, CEO, for any additional or closing remarks.

Thanks, Lori, appreciate it, and I appreciate everybody's time today. So we're through another year. In fiscal year 2013, we're able to stabilize the cash burn. We see 2014 really as a time of change for the company. We're introducing new -- 2 new products: resilient electric grid and the ship protection degaussing system. We have a lot of excitement in Romania with our new operation, our employees and our plant there. In the United States, we're pleased with our progress we've made so far on the consolidation. This has been an extraordinary effort by our employees who are assisting with the manufacturing move, as well as those who've agreed to relocate and those who are transitioning their responsibilities. It's truly been an example of outstanding professionalism and teamwork and I look forward to speaking with you following completion of our first fiscal quarter of 2014. Thank you, and talk to you soon.

That does conclude today's conference. Thank you, all, for your participation today.