Electric Fuel Reduces Q2 Loss, Sales Off

New York— Helped by its cost-cutting efforts, zinc-air fuel cell maker Electric Fuel reduced its net loss for the second quarter by 42 percent, down to a loss of $2.7 million, compared with a loss of $4.6 million in the second three months in 2001. The loss was reduced by 20 percent, compared with the first quarter this year, when the company lost $3.3 million.

Revenue in the second quarter, ended June 30, decreased by 20 percent, to $823,935, compared with $1 million in the year-ago second three months. The figure increased by 12 percent, compared with revenue of $727,000 in the first quarter of 2002.

For the six months, Electric Fuel's net loss decreased by 25 percent, to $6 million, compared with a loss of $8 million in the same period the previous year.

Revenue for the six months dropped by 11 percent, to $1.6 million, compared with $1.8 million year over year.

Electric Fuel anticipates its second half revenue should more than double, to over $5 million, up from the $2.3 million it posted in the second half of 2001.

This increase is expected to come largely from the increase in sales of battery products to the military and homeland security markets, and from the revenue contributed by the van and car armoring business, MDT Protective Services.

This company, acquired by Electric Fuel in July, will start to be included in the company's financial results as of July 1, 2002, and is expected to impact results starting in the third quarter of 2002 as well as the company's second half revenue.