UQM Technologies Reports Fourth Quarter and Fiscal 2005 Operating Results

Press Release 06-04

UQM Technologies, Inc.
7501 Miller Drive
Frederick, CO 80530

Contact:
John Baldiserra
BPC Financial Marketing
(800) 368-1217
or
Donald A. French, Treasurer
(303) 278-2002

FREDERICK, COLORADO, MAY 26, 2005… UQM TECHNOLOGIES, INC. (AMEX: UQM), a developer of alternative energy technologies, announced today operating results for the quarter and fiscal year ended March 31, 2005. Continuing operations for the fourth quarter resulted in a loss of $371,341 or $0.01 per common share on total revenue of $1,537,235 versus a loss from continuing operations of $519,541 or $0.03 per common share on total revenue of $764,804 for the fourth quarter last year. Net loss for the quarter was $380,762 or $0.01 per common share versus a net loss of $1,882,878 or $0.10 per common share for the comparable quarter last year.

Continuing operations for the fiscal year ended March 31, 2005 resulted in a loss of $1,814,695 or $0.09 per common share on total revenue of $4,763,291 versus a loss from continuing operations of $1,422,315 or $0.07 per common share on total revenue of $5,040,904 last fiscal year. Net loss for the fiscal year was $1,868,896 or $0.09 per common share versus a net loss last year of $4,786,953 or $0.25 per common share.

“Loss from continuing operations for the quarter ended March 31, 2005 declined to $371,341 or $0.01 per common share from $519,541 or $0.03 per common share due to higher levels of total revenue which were propelled by nearly a four-fold increase in product sales. Loss from continuing operations for the fiscal year ended March 31, 2005 rose to $1,814,695 or $0.09 per common share versus $1,422,315 or $0.07 per common share last fiscal year reflecting lower margins on contract services and expenditures associated with the expansion of our production engineering activities”, said Donald A. French, UQM Technologies’ Treasurer and Chief Financial Officer. “In November 2004, we completed a follow-on offering of our common stock which allowed us to complete the fiscal year with cash and short-term investments of nearly $8 million. We expect to continue the implementation of our strategy to invest in the expansion of our production engineering and manufacturing infrastructure to position ourselves to successfully execute on the commercialization of our proprietary technology in both existing and emerging markets.”

"During the fiscal year, we continued to make progress in developing products and advancing our technology for both existing as well as new customers, " said William G. Rankin, UQM Technologies President and Chief Executive Officer. "We received a number of important engineering development contracts and orders for prototype products for both commercial and military applications. These included:

* Motors, generators and controllers for large hybrid electric buses for use at Los Angeles International Airport and the 16th Street Mall in Denver

* Motor/generator and controller systems for Eaton Corporation's heavy duty hybrid electric propulsion system program with the U.S. Department of Energy

* An advanced vehicle developed for John Deere incorporating UQM's latest technology

* Motors and controllers for under-the-hood auxiliaries for Delphi Corporation, Engineered Machined Products, Inc. and Keith Products, Inc.

* Motors, generators and controllers for additional large "Spinner" unmanned ground combat vehicles for Carnegie Mellon's Robotics Center

* Motors, generators and controllers for the small "Gladiator" tactical unmanned ground vehicle for the U.S. Marine Corps.

* Starter/motor/generators for Stewart & Stevenson's FMTV mid-sized truck

Advanced wheel motors and controllers for military vehicles for the Tank Automotive Command (TACOM)

* An onboard generator for small unmanned military boats for the U.S. Navy

* A DC to AC inverter for stationary power applications for the U.S. Department of Energy

“The emergence of hybrid electric vehicles in the automobile market is driving vehicle makers in a wide range of other on-road and off-road markets to consider the strategic and competitive advantages of adopting hybrid electric technology. Customers in these markets typically require hybrid electric propulsion systems of different size and power level than that required in automotive applications. These customers seldom have the internal resources to develop their own systems which we believe will create a breadth of opportunities for our motor and generator products. Nearly every on-road, off-road and military vehicle maker, as well as their major drivetrain suppliers, have launched serious programs to accelerate the adoption of electric power in their products. This is clearly the time for our Company to aggressively pursue these opportunities - to make selective investments in programs and product developments that we believe could lead to volume production, ” Added Mr. Rankin, “To support this strategy, we completed a follow-on stock offering during our third fiscal quarter which raised our cash balance and strengthened our balance sheet. This improvement in our financial position has given our existing customers, as well as new customers, a higher level of confidence that we have the financial resources to execute their production intent programs. In addition, we have significantly expanded our manufacturing management and production engineering organization and have plans to add additional human resources to meet the growing demands of our customers who are requiring much more comprehensive quoting and production planning. We are taking the steps which we believe are necessary to successfully participate in this potentially large market and are excited about our growth prospects."

The Company will host a conference call today at 4:30 p.m. Eastern Daylight Time to discuss operating results for the quarter and fiscal year ended March 31, 2005. To attend the conference call, please dial 1-800-725-9502 approximately ten minutes before the conference is scheduled to begin. International callers should dial 1-415-908-6291. 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 Daylight Time today. To access the playback call 1-800-633-8284 and give reservation number 21247451. International callers should dial 1-402-977-9140.

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 and fuel cell electric vehicles, 42-volt 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.

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES Consolidated Statements of Operations

							Quarter Ended March 31,		Year Ended March 31,
							2005	2004	2005	2004
Revenue:
	Contract services						$ 675,805	538,319	2,281,427	2,747,833
	Product sales						861,430	226,485	2,481,864	2,293,071
							1,537,235	764,804	4,763,291	5,040,904

Operating costs and expenses:
	Costs of contract services						719,611	529,998	2,496,223	2,215,196
	Costs of product sales						628,216	220,880	1,994,540	1,960,549
	Research and development						33,368	66,818	171,918	461,223
	Production engineering						118,454	-	211,933	-
	General and administrative						391,356	488,394	1,686,409	1,799,472
	Impairment of long-lived assets						39,748	28,359	39,748	30,523
							1,930,753	1,334,449	6,600,771	6,466,963

			Loss from continuing operations
				before other income (expense)			(393,518)	(569,645)	(1,837,480)	(1,426,059)

Other income (expense):
	Interest income						49,452	7,406	97,188	26,362
	Interest expense						(16,877)	(18,277)	(74,005)	(84,193)
	Gain on sale of Taiwan joint venture						-	60,975	-	60,975
	Other						(10,398 )	-	(398 )	600
							22,177	50,104	22,785	3,744

			Loss from continuing operations				(371,341)	(519,541)	(1,814,695)	(1,422,315)

Discontinued operations:
	Loss from operations of discontinued
		electronic products segment (including
		loss on disposal in 2004 of $770,434)					(9,421)	(1,363,337)	(54,201)	(3,364,638)
							(9,421)	(1,363,337)	(54,201)	(3,364,638)

			Net loss				$ (380,762)	(1,882,878)	(1,868,896)	(4,786,953)

			Net loss per common share – basic
					and diluted
						Continuing operations	$ (.01)	(.03)	(.09)	(.07)
						Discontinued operations	-	( .07)	-	(.18 )
							$ ( .01)	( .10)	( .09)	( .25)

Weighted average number of shares of
	common stock outstanding – basic
	and diluted						23,175,893	19,572,571	21,024,757	19,172,680

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES Consolidated Balance Sheets
Assets				March 31, 2005	March 31, 2004
Current assets:
	Cash and cash equivalents			$ 5,776,750	2,958,590
	Short-term investment			2,210,727	47,119
	Accounts receivable			911,416	512,995
	Costs and estimated earnings in excess of billings on
		uncompleted contracts		435,925	245,984
	Inventories			648,173	428,438
	Prepaid expenses and other current assets			109,640	72,649
	Assets of discontinued operations			-	1,226,943
				10,092,631	5,492,718

Property and equipment, at cost:
	Land			181,580	181,580
	Building			2,292,687	2,292,687
	Machinery and equipment			2,422,034	2,793,343
				4,896,301	5,267,610
	Less accumulated depreciation			(2,443,590)	(2,732,291 )
			Net property and equipment	2,452,711	2,535,319

Patent and trademark costs, net of accumulated amortization
	of $450,011 and $360,266			613,448	692,371
Other assets				850	850

				$ 13,159,640	8,721,258

				March 31, 2005	March 31, 2004
Liabilities and Stockholders’ Equity
Current liabilities:
	Accounts payable			$ 678,007	392,474
	Other current liabilities			269,746	258,258
	Current portion of long-term debt			135,255	125,611
	Liabilities and commitments of discontinued operations			154,287	554,564
	Billings in excess of costs and estimated earnings on
		uncompleted contracts		66,510	189,252
			Total current liabilities	1,303,805	1,520,159
Long-term debt, less current portion				810,915	946,423
Long-term liabilities and commitment of discontinued operations				57,051	192,118
			Total long-term liabilities	867,966	1,138,541
			Total liabilities	2,171,771	2,658,700

Stockholders’ equity:
	Common stock, $.01 par value, 50,000,000 shares authorized;
		23,177,133 and 19,572,625 shares issued and outstanding		231,771	195,726
	Additional paid-in capital			64,767,975	58,025,631
	Accumulated deficit			(54,011,877)	(52,142,981)
	Note receivable from officer			‑	(15,818 )
			Total stockholders’ equity	10,987,869	6,062,558

				$ 13,159,640	8,721,258

The following table summarizes significant financial statement information for continuing operations of each of the reportable segments for the year ended March 31, 2005:

		Mechanical
	Technology	Products	Total
Revenue	$ 3,089,114	1,674,177	4,763,291
Interest income	89,869	7,319	97,188
Interest expense	(2,108)	(71,897)	(74,005)
Depreciation and amortization	(245,735)	(109,682)	(355,417)
Write-down of assets	(39,748)	-	(39,748)
Segment earnings (loss) from
continuing operations	(1,869,518)	54,823	(1,814,695)

Assets of continuing operations	9,967,003	3,192,637	13,159,640

Expenditures for segment assets	$ (194,873)	(49,434)	(244,307)

The following table summarizes significant financial statement information for continuing operations of each of the reportable segments for the year ended March 31, 2004:

		Mechanical
	Technology	Products	Total

Revenue	$ 3,339,939	1,700,965	5,040,904
Interest income	22,054	4,308	26,362
Interest expense	(3,704)	(80,489)	(84,193)
Depreciation and amortization	(278,894)	(168,558)	(447,452)
Write-down of assets	(30,523)	-	(30,523)
Segment loss from continuing operations	(1,289,738)	(132,577)	(1,422,315)

Assets of continuing operations	4,705,076	2,789,239	7,494,315

Expenditures for segment assets	$ (175,303)	(27,554)	(202,857)

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 development of markets for our products; the adequacy of our cash balances and liquidity to meet future operating needs, and our ability to issue equity or debt securities; and the effect of legal actions and claims that we are involved in. Important Risk Factors that could cause actual results to differ from those contained in the forward-looking statements are contained in our Form 10-K filed May 26, 2005 which is available through our website at www.uqm.com or at www.sec.gov.

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Last Update: 05/26/05