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 Management of Corporate Communications, Kerry Farrell. For opening remarks, I would like to turn the conference over to Kerry Farrell. Please go ahead.

Thank you, Jessica, and welcome to our call to discuss our fourth quarter and full year fiscal 2012 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 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 Factors section of our annual report on Form 10-K for the fiscal year ended March 31, 2013, which we filed with the SEC earlier 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 would also like to note that we will be referring on today's call to non-GAAP net loss or net loss before adverse purchase commitments; losses; net stock-based compensation; amortization of acquisition-related intangibles; restructuring and impairment charges; executive severance; Sinovel litigation costs; loss contingency for shareholder litigation; consumption of zero cost-basis inventory; noncash interest expense; change in fair value of derivatives and warrants; and other unusual charges net of any tax effects related to these items. Net GAAP -- 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 on Form 8-K. All of our press releases and SEC filings can be accessed from the Investors page of our website at www.amsc.com. I will now turn the call over to CEO, Dan McGahn. Dan?

Thanks, Kerry. I'll begin today by describing the results we have achieved over the past 2 years. I'll also provide an update on our litigation in China. Dave will then review our financial results and provide our guidance for our first fiscal quarter. I'll then share our longer-term business outlook, including our strategy to achieve positive net cash flow on a quarterly basis by the end of fiscal 2014. Then we'll open up the line to your questions. Since I took the position of CEO 2 years ago, we have diversified our revenue stream and I believe that we've created a strong foundation for a healthy and stable business. Let me begin by describing the successes and results we've achieved over the past 2 years. When we talk about our strategy going forward, we'll focus on the next 2 years. In our Grid segment, we've sold our D-VAR STATCOM to utilities, developers and industrial companies in Australia, China, Europe, North America and the United Kingdom. In fact, in FY '12, we announced the sale of our 100th STATCOM system. We've also made significant accomplishments with our superconductor wire. We introduced distribution fault current limiters to the North American market and sold wire for a fault current limiter in Europe. We also successfully qualified a transmission fault current limiter with industry leaders, Nexans and Siemens. We began shipping Amperium wire to LS Cable under our supply agreement, and Korea energized its first superconductor cable. We were chosen as the wire provider for a superconductor motor for POSEIDON, a project aimed at improving the efficiency of Europe's commercial shipping fleet. In the United States, we secured exclusive rights to a fundamental superconductor patent. And finally, we doubled performance and reduced pricing on our HTS wire. In our Wind segment, we signed a…

Thanks, Dan, and good morning, everyone. AMSC generated $20.4 million in revenues for the fourth quarter. While this is down from $28.6 million in the year-ago quarter, it is up from $17.4 million in the third quarter of fiscal year 2012. For the full fiscal year, we generated revenues of $87.4 million, up 14% from $76.5 million in fiscal year 2011. The full year growth was driven by our Grid business, which grew 35% year-over-year. Looking at the P&L in more detail, gross margin for the fourth quarter was 11.4%, which compares with 12.4% in the fourth quarter of fiscal 2011 and 5.1% in the third quarter of fiscal 2012. Normalized for activity associated with our adverse purchase commitments, gross margin nearly doubled to 14.6% in the fourth quarter of fiscal 2012 compared to 7.6% in the fourth quarter of fiscal 2011. R&D and SG&A expenses for the fourth quarter were $17.2 million. This was down nearly $6 million from $23.1 million for the same period a year earlier, reflecting our cost reduction initiatives, but it is up from $14.7 million in the third quarter. Fourth quarter SG&A expense includes a nonrecurring charge of $1.8 million related to the class-action shareholder lawsuit. An agreement in principle has been reached between the company, our insurers and the plaintiffs to settle the lawsuit. The charge represents the amount the company expects to pay directly to the plaintiffs as part of the settlement. The plaintiffs have tentatively agreed to accept payment in stock. We believe that the settlement will be finalized and payment made before the end of the second quarter of fiscal 2013. Excluding this charge, operating expenses were roughly flat compared to the third quarter. We continue to expect R&D and SG&A expenses to be less than $58 million on an…

Thanks, Dave. Back in April, we announced that we expect to achieve positive net cash flows on a quarterly basis by the end of fiscal year 2014. This target is expected to require annualized revenues in the range of $190 million to -- sorry, $180 million to $190 million with roughly an equal split between our Wind and Grid businesses. First, let me focus on the Grid market. This business consists of our D-VAR product for utilities, industrial companies and the renewable industry and high temperature superconductor or HTS products for utility and marine applications. We estimate the addressable market for this business at $2 billion as rising power usage in urban centers increases the demand for grid reliability and resiliency. In North America, we are conducting more than 4 gigawatts of renewables with our D-VAR product. Over the past few months, we've seen increased quoting activity in this region. In the U.S., this is most likely a result of the production tax credit extension. And in Canada, much of the interest is for the renewable application as well. But there is also a fair amount of interest from the utility and industrial markets. In addition, we are also pursuing D-VAR business in South Africa, South America, Romania, Spain and the Middle East, all regions in which we believe there are large opportunities. We believe we can quickly show progress in the expansion of our regional reach, and we look forward to showing new markets opening for D-VAR. Moving to our superconductor products. Today's utilities are facing challenges far beyond increased load from air conditioning in the summer and trees damaging overhead lines during winter storms. Utilities are now being faced with massive destruction from megastorms like Superstorm Sandy. The National Research Council, a private independent agency operating under a…

[Operator Instructions] We'll go first to Carter Driscoll with Ascendiant Capital Markets.

First question, maybe you talked about the Chinese market offshore and onshore and some of their relationships that they currently have, maybe JCNE, Dongfang. I think that during the last call, you talked about China maybe having another weak year year-over-year, and now it looks like you're talking about maybe being up 20%. Can you talk about maybe what's changed in the past few months from your viewpoint?

I think that the outlook over the -- if you go look back the past 2 years, people have assumed that there's going to be a lull. I think there's a debate as to how long that lull would occur. What we're seeing in the recent months, the market analysts that cover China and what we're seeing from the Chinese government itself is belief that they're going to get back to growth here in 2013 and sustain that growth through 2014 and beyond. With our partners in China, we've gotten to the point where they're ready to deploy. They have advanced technology for larger turbines, and we believe that they're in a position to go take market share. If we listen to our partners and look at their pipelines, they're well positioned for growth. What we now have to do jointly is demonstrate that growth with our partners.

We'll go next to JinMing Liu with Ardour Capital.

Is there any update you can provide us for the arbitration process against the Sinovel?

In the remarks, we went through a little bit of this. We've gone through now what we believe are almost all or all of the hearings. We believe that we'll see movement in the case in the next coming months. I think one of the challenges with the arbitration case relates to the trade secret cases. So recall that the trade secret cases have now been brought to the People's Supreme Court in China over a jurisdictional matter. And the jurisdictional matter is simply, should the cases stand on their own or should they be attached to the commercial arbitration? So you might see or you might be convinced that the arbitration case may be waiting for the Supreme Court to make a decision on the jurisdictional matter. We don't have direct information from China that says that, but that's a logical conclusion one could draw.

Okay, got that. I may have missed that. What kind of revenue you make out from one Navy system?

We haven't disclosed pricing, and that's a sensitive matter for the U.S. Navy.

Okay, got that. For your long-term guidance, meaning the fourth quarter '14 year guidance, in there, I mean, can you give us more color in terms of your potential geographic revenue stream from -- for your long-term targets? Because you mentioned you have been working on different areas like the South America and the Eastern Europe, so can you provide us with more details?

Sure. So if you look at the Grid segment, there's really 3 pieces to it. So for D-VAR, we want to increase sales in the markets that we're active today, and then we're looking to supplement that growth with additional sales in some of these emerging markets. So the core markets that we've sold into D-VAR are the U.S., Canada, the United Kingdom and Australia. So we see the potential to be able to grow in those markets, as well as opening up new markets for the product in some of these additional emerging markets. So we see growth on both sides in the established markets and adding some additional revenue through the emerging markets. I think the key pieces of the Grid business growth mean securing orders on the HTS side for a cable system and for a degaussing system with the U.S. Navy. On the Wind side, which I think is where most of your thinking is focused, JinMing, we think again that there's 3 pieces to this, but principally it will be through component sales to Inox because they're publicly stating that they're going to double. And when we look at their pipeline, we're convinced that what they're saying publicly should come to fruition. That alone gets us most of the way there. And if we're able to simply supplement those sales in India through China, and maybe even we could consider a small amount of augmented sales through some of the other licensees. But the lion's share, we believe, to get back to profitability can come merely from Inox and supplemental revenue from China. So I've given you kind of a qualified -- a nonquantitative answer to what you're looking for, but I think you get the general sense of where we're headed.

Yes, I think that is consistent with what I got from other sources.

And at this time, we'll go back to Carter Driscoll.

I apologize I got cut off there, guys, so I may have missed a bit or 2 there. Back to the Department of Homeland Security and Con Ed, could you kind of give us your framework of what the fault current limiter market opportunity could be in the near term and then long term and maybe bracket the size of your impact to revenue, and then maybe qualify that product within the Grid segment portfolio in terms of its margin contribution without giving specific parameters just to kind of...

Yes, I'll try. I know one of the things that we're saying today is now we're talking about systems from the Navy and for fault current limiting. And you guys don't have a good sense of what the pricing or what the margin can be. But I think if you look at the model that you're using and you get to the $180 million or $190 million, you can see roughly the -- what you think the contribution could come from HTS. When we've talked in the past and we've talked about projects, we said that the HTS business itself could be profitable, or that product line could be profitable really with 1 large project or 2 normal-sized projects. In general, revenue for these types of projects are going to be in the tens of millions of dollars, which is a very different order size than what we see from D-VAR. To talk about margins and things like that, I think it's a bit premature. I think as we get an order, you will start to see more quantitative numbers around what the part of the business would look like. I don't know, Dave, if you want to...

I don't have anything else to add on that, so...

How about just the ability to use the project in the context of other utilities interested in doing so? Maybe the engagement process about taking the successful demonstration and importing it to other geographic regions. I mean, what is the ability to do so of Con Ed? And then have they helped you market this project themselves?

Yes, them and Homeland Security certainly are. And I think when you look at it and you look at the fact that Con Edison is involved and the complexity of their network, and you look at Homeland Security and their charter and the electricity grid is one of the main assets that they're looking to protect, that's helped us to try to build a network of -- and it's not just interested utilities. It's utilities with a specific site that they're looking to change the way the grid works in an urban environment. And what's good about the Con Ed experience is the technology has been proven out. We went through the deployment schedule, that it will be deployed this year in 2013 and operational in 2014, that we believe on the heels of that plus a lot of the macroclimate around protecting the grid in specific cities. You look at the Eastern Seaboard after the storms that we've gone through, and you look at specific assets in the U.S. that Homeland Security has identified. This nets out to about a dozen or so near-term projects that we believe would require the technology. And we've already moved forward with about 6 of them where we're getting into specifics around system design, what costs might look like and how a project would be rolled out, timetables and things like that. This is a very different rhetoric you've heard from the company this quarter than you've heard in past quarters. We're starting to see the movement now directly towards specific projects and projects that would not be one at a time, but potentially multiple projects coming here in the coming years.

And then maybe just shifting gears a little bit back to the potential sale of your minority interest in Tres Amigas and Blade, can you sort of compare the need for cash and divestment assets versus your happiness or a dissatisfaction with the progress of what these investments have yielded so far?

Well, actually they, I mean, from -- we're viewing these 2 investments as a source of potential liquidity, that's an alternative to going out to the equity markets or to the debt markets. We're actually happy with the investments, and we're not dissatisfied at all with them. I mean, in the case of Blade Dynamics, I mean, they are -- they're continuing to move forward with starting to commercialize their innovative blade technology. They have -- they just closed a deal with a Saudi Arabian company called SABIC to license their blade technology to them so that they can build blades in the Middle East. They also recently closed on a blade development arrangement with the Electricity Technologies Institute, and -- I'm sorry, Energy Technologies Institute in the U.K. Also for blade development, as part of that whole arrangement, ETI, for short, also made an equity investment themselves in Blade Dynamics. And so the whole thing, the development arrangement and the equity investment in total was over $24 million. So that's Blade Dynamics. For Tres Amigas, they're continuing to move forward with getting prepared to start the process of financing their Phase 1 construction. They're making good progress in that regard. There's been a lot -- there's a lot of interest. So there's a lot of buzz about what's going on out there in New Mexico and what that might mean to the grid. We bought -- we're into that investment because of superconductors. That -- the first phase is only for a back-to-back 750-megawatt line, so that's -- you don't need superconductors for that. But in later phases, when the station is moving towards its full vision capacity, maybe down the road, there's the opportunity for superconductors. But not right now. But bottom line, we're excited about the progress of both these companies. But if there's a -- if we can find a potential buyer at a price that we can find acceptable, then maybe we'll divest of one or both of them in order to enhance our liquidity. But to repeat, it's not required and it's not -- any proceeds from something like that are not part of the forecasts in terms of our cash burn that we provided to you today.

This does conclude today's question-and-answer session. At this time, I would like to turn the conference over back -- back over for closing remarks.

Well, one thing, one other question that we typically get when we -- or we have been getting and also something that's relatively new is the shareholder lawsuit. So let me provide just a little bit more color on that. Today, we announced that we reached an agreement in principle among the company insurers and the plaintiffs to settle the class-action lawsuit. There's still procedural steps to overcome, though, to finalize a settlement. Specifically, the terms need to be documented in an agreement, which then needs to be filed and approved by the court. That process could still take a few months. But even though that process hasn't been completely closed down and finalized, for accounting purposes, though, we did cross the threshold to account for the potential settlement, and we did so during the fourth quarter. Again, that's -- that means a settlement of $1.8 million that we would pay to the plaintiffs as part of the overall settlement, which would be -- right now contemplated to be done in stock.

Great. Thanks, Dave. So just to kind of summarize today's points, in the past year, we've reduced our net loss by more than 50%, and we've reduced our cash burn by more than 70%. We're now focused on the next 2 years. For fiscal year 2013, we are reiterating our belief that we'll be able to generate annual revenue, growing at least 25%. 75% of that forecasted revenue is already in backlog. And we believe that we can achieve positive net cash flow on an annualized basis by the end of fiscal year 2014. We want to thank everybody for joining today's call, and we look forward to reporting back to you in a few months on our first fiscal quarter for 2013. Thank you.

This does conclude today's conference. Thank you for your participation.