UQM Technologies Reports Second Quarter Operating Results

FREDERICK, Colo.--(BUSINESS WIRE)--UQM Technologies, Inc. (AMEX: UQM), a developer of alternative energy technologies, announced today operating results for the quarter and six months ended September 30, 2007. Continuing operations for the second quarter resulted in a loss of $1,139,894 or $0.04 per common share on total revenue of $1,990,591 versus a loss from continuing operations of $864,930 or $0.04 per common share on total revenue of $1,614,218 for the second quarter last fiscal year. Net loss for the quarter was $1,139,894 or $0.04 per common share versus a net loss of $879,570 or $0.04 per common share for the comparable quarter last fiscal year.

Continuing operations for the six months ended September 30, 2007 resulted in a loss of $2,268,645 or $0.09 per common share on total revenue of $3,445,043 versus a loss from continuing operations of $1,650,614 or $0.07 per common share on total revenue of $2,915,550 last fiscal year. Net loss for the first half was $2,268,645 or $0.09 per common share versus a net loss last year of $1,667,366 or $0.07 per common share.

“Total revenue for the quarter rose 23.3 percent versus the second quarter last year fueled by strong growth in both low volume and higher volume product sales which rose 38.5 percent and 62.1 percent, respectively, versus the comparable quarter last year. Similarly, total revenue for the first half rose 18.2 percent driven by a 60.8 percent increase in lower volume product sales and a 69.4 percent increase in higher volume product sales versus the same period last year. Net loss for the quarter and six month period ended September 30, 2007 increased primarily due to substantially higher expenditures on production engineering activities and higher levels of research and development and selling, general and administrative expenses,” said Donald A. French, UQM Technologies’ Treasurer and Chief Financial Officer. “Separately, we have been notified by Phoenix Motorcars, Inc. of their intention to cancel the Purchase and Supply Agreement with us and an associated purchase order to buy $9.25 million of our products, due to significant issues at Phoenix Motorcars, Inc. unrelated to our performance. We believe that a substantial portion of the purchase order is not subject to cancellation. Accordingly, we expect to hold discussions with Phoenix to obtain additional information regarding their position and pursue a satisfactory resolution.”

The Company will host a conference call today at 4:30 p.m. Eastern Time to discuss operating results for the quarter ended September 30, 2007. To attend the conference call, please dial 1-866-214-7077 approximately ten minutes before the conference is scheduled to begin. International callers should dial 1-416-915-9608. For anyone who is unable to participate in the conference, a recording will be available for 48 hours beginning at 6:30 p.m. Eastern Time today. To access the playback, call 1-866-244-4494 and give replay code 281071. International callers should dial 1-416-915-1028.

UQM Technologies, Inc. is a developer and manufacturer of power dense, high efficiency electric motors, generators and power electronic controllers for the automotive, aerospace, medical, military and industrial markets. A major emphasis of the Company is developing products for the alternative energy technologies sector including propulsion systems for electric, hybrid electric, plug-in hybrid electric and fuel cell electric vehicles, under-the-hood power accessories and other vehicle auxiliaries and distributed power generation applications. The Company's headquarters, engineering and product development center, and motor manufacturing operation are located in Frederick, Colorado. For more information on the Company, please visit its worldwide website at www.uqm.com.

This release contains statements that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. These statements appear in a number of places in this release and include statements regarding our plans, beliefs or current expectations, including those plans, beliefs and expectations of our officers and directors with respect to, among other things, the status of our agreements with Phoenix Motorcars, Inc., improvements in our financial performance, the development of markets for our products and the adequacy of our cash balances and liquidity to meet future operating needs. Important Risk Factors that could cause actual results to differ from those contained in the forward-looking statements are contained in our Form 10-Q filed today, which is available through our website at www.uqm.com or at www.sec.gov.

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES Consolidated Balance Sheets (unaudited)
		September 30, 2007			March 31, 2007
Assets
Current assets:
Cash and cash equivalents		$ 3,798,008			1,952,177
Short-term investments		7,277,000			5,981,828
Accounts receivable		1,843,183			1,434,686
Accounts receivable from discontinued operations		26,266			76,097
Costs and estimated earnings in excess of billings on uncompleted contracts		203,556			187,913
Inventories		1,014,538			899,885
Prepaid expenses and other current assets		318,516			279,343
Total current assets		14,481,067			10,811,929
Property and equipment, at cost:
Land		181,580			181,580
Building		2,428,895			2,306,154
Machinery and equipment		3,384,621			3,152,296
		5,995,096			5,640,030
Less accumulated depreciation		(3,156,996	)		(2,977,305	)
Net property and equipment		2,838,100			2,662,725
Patent and trademark costs, net of accumulated amortization of $650,138 and $622,320		485,184			482,303
Other assets		54,666			55,650
Total assets		$ 17,859,017			14,012,607
		September 30, 2007			March 31, 2007
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable		$ 549,027			982,931
Other current liabilities		321,822			344,952
Current portion of long-term debt		102,346			98,760
Short-term deferred compensation under executive employment agreements		340,437			149,325
Liabilities and commitments of discontinued operations		-			13,847
Billings in excess of costs and estimated earnings on uncompleted contracts		963,542			312,537
Total current liabilities		2,277,174			1,902,352
Long-term debt, less current portion		470,994			522,925
Long-term deferred compensation under executive employment agreements		603,200			396,214
		1,074,194			919,139
Total liabilities		3,351,368			2,821,491
Commitments and contingencies
Stockholders’ equity:
Common stock, $.01 par value, 50,000,000 shares authorized; 26,508,882 and 25,176,889 shares issued and outstanding		265,089			251,769
Additional paid-in capital		76,948,320			71,376,462
Accumulated deficit		(62,705,760	)		(60,437,115	)
Total stockholders’ equity		14,507,649			11,191,116
Total liabilities and stockholders’ equity		$ 17,859,017			14,012,607

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES Consolidated Statements of Operations (unaudited)
		Quarter Ended September 30,						Six Months Ended September 30,
		2007			2006			2007			2006
Revenue:
Contract services		$ 581,429			679,126			1,096,179			1,503,480
Product sales		1,409,162			935,092			2,348,864			1,412,070
		1,990,591			1,614,218			3,445,043			2,915,550
Operating costs and expenses:
Costs of contract services		418,442			613,130			879,588			1,268,255
Costs of product sales		1,208,247			879,248			2,172,650			1,403,324
Research and development		128,175			79,330			226,499			174,481
Production engineering		403,422			232,517			949,455			480,889
Selling, general and administrative		1,082,529			780,322			1,712,365			1,452,839
		3,240,815			2,584,547			5,940,557			4,779,788
Loss from continuing operations before other income (expense)		(1,250,224	)		(970,329	)		(2,495,514	)		(1,864,238	)
Other income (expense):
Interest income		120,683			117,559			244,122			238,211
Interest expense		(10,353	)		(12,160	)		(21,253	)		(24,587	)
Gain on sale of property and equipment		-			-			4,000			-
		110,330			105,399			226,869			213,624
Loss from continuing operations		(1,139,894	)		(864,930	)		(2,268,645	)		(1,650,614	)
Discontinued operations – loss from operations of discontinued electronic products segment		-			(14,640	)		-			(16,752	)
Net loss		$(1,139,894	)		(879,570	)		(2,268,645	)		(1,667,366	)
Net loss per common share - basic and diluted
Continuing operations		$ (.04	)		(.04	)		(.09	)		(.07	)
Discontinued operations		-			-			-			-
		$ (.04	)		(.04	)		(.09	)		(.07	)
Weighted average number of shares of common stock outstanding - basic and diluted		26,483,797			25,137,888			25,872,523			25,082,358

The following table summarizes significant financial statement information for continuing operations of each of the reportable segments as of and for the quarter ended September 30, 2007:

						Power
		Technology				Products			Total
Revenue		$	1,206,572			784,019			1,990,591
Interest income		118,343				2,335			120,678
Interest expense		-				(10,353	)		(10,353	)
Depreciation and amortization		(58,083		)		(52,535	)		(110,618	)
Segment loss from continuing operations		(952,951		)		(186,943	)		(1,139,894	)
Assets of continuing operations		14,162,219				3,670,532			17,832,751
Expenditures for long-lived segment assets		$	(108,035	)		(128,468	)		(236,503	)

The following table summarizes significant financial statement information for continuing operations of each of the reportable segments as of and for the quarter ended September 30, 2006:

						Power
		Technology				Products			Total
Revenue		$	1,130,528			483,690			1,614,218
Interest income		116,830				729			117,559
Interest expense		-				(12,160	)		(12,160	)
Depreciation and amortization		(67,538		)		(41,164	)		(108,702	)
Segment loss from continuing operations		(695,161		)		(169,769	)		(864,930	)
Assets of continuing operations		11,365,226				3,169,017			14,534,243
Expenditures for long-lived segment assets		$	(31,787	)		(48,094	)		(79,881	)

The following table summarizes significant financial statement information for continuing operations of each of the reportable segments as of and for the six months ended September 30, 2007:

						Power
		Technology				Products			Total
Revenue		$	1,910,946			1,534,097			3,445,043
Interest income		239,819				4,298			244,117
Interest expense		-				(21,253	)		(21,253	)
Depreciation and amortization		(113,535		)		(103,259	)		(216,794	)
Segment loss from continuing operations		(1,937,541		)		(331,104	)		(2,268,645	)
Assets of continuing operations		14,162,219				3,670,532			17,832,751
Expenditures for long-lived segment assets		$	(227,289	)		(167,761	)		(395,050	)

The following table summarizes significant financial statement information for continuing operations of each of the reportable segments as of and for the six months ended September 30, 2006:

						Power
		Technology				Products			Total
Revenue		$	2,010,160			905,390			2,915,550
Interest income		235,919				2,292			238,211
Interest expense		-				(24,587	)		(24,587	)
Depreciation and amortization		(134,667		)		(71,999	)		(206,666	)
Segment loss from continuing operations		(1,301,208		)		(349,406	)		(1,650,614	)
Assets of continuing operations		11,365,226				3,169,017			14,534,243
Expenditures for long-lived segment assets		$	(117,020	)		(208,519	)		(325,539	)