-- Revenue for the first quarter of fiscal year 2008 ended September 30,
2007 increased 1% or $32,000.
-- Gross Margin increased by $188,000.
-- Gross Margin percentage increased to 10% in the first quarter of 2008
from 2% in the fourth quarter of fiscal 2007 (ended June 30, 2007).
-- Operating and other costs below the gross profit line increased by
$391,000 in the first quarter of 2008 compared to the fourth quarter of
2007 due to severance costs and other non-recurring charges.
-- These factors combined to contribute to a higher net loss of $1.5
million or $(0.28) per share compared with $1.3 million or $(0.29) per
share in the fourth quarter of 2007.
-- Disclosure backlog as of September 30, 2007 was $2.6 million up 44%
from the backlog as of June 30, 2007 of $1.8 million.
Financial Quick Reference
In millions, except earnings per share data
Three months ended
Sept. 30, June 30, Sept. 30,
2007 2007 2006
Revenues $ 2.31 $ 2.28 $ 4.39
Gross Profit $ 0.24 $ 0.05 $ 1.07
Net Loss $ (1.50) $ (1.30) $ (0.45)
Loss per share (basic &
diluted) $ (0.28) $ (0.29) $ (0.10)
Cash used by operations $ (1.25) $ (0.42) $ (0.30)
September 30, June 30, June 30,
2007 2007 2006
Cash and cash equivalents $ 2.88 $ 1.29 $ 3.76
Detailed comments about the first quarter of fiscal 2008: For the quarter
ended September 30, 2007, the Company reported total revenues of $2.31
million compared to $2.28 million for the quarter ended June 30, 2007, an
increase of 1%. Net loss for the quarter ended September 30, 2007was $1.5
million or $0.28 per share compared to a net loss of $1.3 million, or $0.29
per share in the quarter ended June 30, 2007. Our non-telecommunications
industry sales are increasing but they have not grown fast enough to make
up for the decline in the telecommunications sector sales.
At September 30, 2007 our disclosure backlog was $2.6 million, an increase
of 44% over our disclosure backlog of $1.8 million for the fourth quarter
of 2007 ending June 30, 2007.
Gross Margin increased in the first quarter of fiscal 2008 compared to the
previous quarter. Gross Margin for the quarter ended September 30, 2007 was
approximately $239,000, or 10%, which included a $150,000 inventory
adjustment for scrap compared to $50,000, or 2% for the quarter ended June
30, 2007. The increase in gross margin in the first quarter of 2008 was
mainly attributable to improved production yields and productivity at our
China facility offset by non-recurring charges for freight and travel to
China and lower average lens prices. We are experiencing cost improvements
in our direct expenses, but the lower sales levels are not adequate to
cover our overhead costs. As we improve our revenues we expect our margins
to improve.
Selling, general & administrative expenses increased by $425,000 due to
non-recurring charges for severance and executive search fees relating to
the recent departure of our former CEO, contributing to an increase in our
net loss of $1.5 million for the first quarter of 2008 compared to a net
loss of $1.3 million in the fourth quarter of 2007.
Comments: Jim Gaynor, Interim CEO of LightPath, stated, "In the first
quarter, revenue flattened but remained low due to the continued weakness
of the telecom and defense markets. Our telecom business was 16% of total
revenue compared to 33% of total revenue in the prior quarter and 59% of
total revenue for the first quarter of fiscal 2006. While our other
business segments improved and our backlog of new orders grew 39% over the
prior quarter it did not offset the lower telecom sales. Direct costs for
material, labor and services continued to show improvement as a result of
the cost reduction strategy we are implementing. These costs were 21% of
revenue in the first quarter of 2008 as compared to 47% of revenue for the
first quarter of 2007 and 42% of revenue for all of fiscal 2007. Overhead
and SG&A costs are in line with our budget with the exception of the
severance costs for our former CEO."
Mr. Gaynor went on to state, "LightPath is continuing to implement its
business strategy to diversify its served markets and position the Company
to participate in lower cost, higher volume opportunities. We have expanded
our China manufacturing capacity, producing over 75% of our first quarter
lens volume in that factory. We are implementing "RoHS"(RoHS is a European
Union Standard that restricts the use of certain hazardous materials such
as lead and mercury) compliant glass, developing lower cost glass materials
and implementing other cost reductions. As a result of the management
actions taken we are seeing positive results in yield improvement,
production rates and cost reductions. We are continuing to position the
company to participate in higher volume market opportunities."
Additional information concerning the Company and its products can be found
at the Company's web site at www.lightpath.com.
LightPath manufactures optical products, including precision molded
aspheric optics, precision molded infrared optics, GRADIUM® glass
products, proprietary collimator assemblies, isolators utilizing
proprietary automation technology, higher-level assemblies and packing
solutions. LightPath has a strong patent portfolio that has been granted or
licensed to us in these fields. LightPath common stock trades on the NASDAQ
Capital Market under the symbol "LPTH." Investors are encouraged to go to
LightPath's website for additional financial information.
This news release includes statements that constitute forward-looking
statements made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. This information may involve
risks and uncertainties that could cause actual results to differ
materially from such forward-looking statements. Factors that could cause
or contribute to such differences include, but are not limited to, factors
detailed by LightPath Technologies, Inc in its public filings with the
Securities and Exchange Commission.
LIGHTPATH TECHNOLOGIES, INC.
Condensed Consolidated Balance Sheets
Unaudited Audited
September June
30, 30,
Assets 2007 2007
------------ ------------
Current assets:
Cash and cash equivalents $ 2,882,661 $ 1,291,364
Trade accounts receivable, net of
allowance of $92,018 at September 30,
2007 and $28,968 at June 30, 2007 1,352,960 1,408,815
Inventories 1,758,883 1,853,324
Prepaid expenses and other assets 147,025 220,860
------------ ------------
Total current assets 6,141,529 4,774,363
Property and equipment - net 1,586,975 1,563,250
Intangible assets - net 224,388 232,605
Other assets 57,306 57,306
------------ ------------
Total assets $ 8,010,198 $ 6,627,524
============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 876,550 $ 1,278,328
Accrued liabilities 675,715 326,525
Accrued payroll and benefits 310,744 413,576
Notes Payable 166,645 166,645
Capital lease obligations, current portion 16,835 16,285
------------ ------------
Total current liabilities 2,046,489 2,201,359
------------ ------------
Capital lease obligation, excluding current
portion 19,232 23,653
Note payable, excluding current portion 236,080 277,741
------------ ------------
Total liabilities 2,301,801 2,502,753
Stockholders' equity:
Preferred stock: Series D, $.01 par value,
voting; 5,000,000 shares authorized; none
issued and outstanding -- --
Common stock: Class A, $.01 par value, voting;
34,500,000 shares authorized; 5,323,511
and 4,512,543 shares issued and
outstanding at September 30, 2007 and
June 30, 2007, respectively 53,235 45,125
Additional paid-in capital 199,474,985 196,417,217
Foreign currency translation adjustment (22,263) (43,059)
Accumulated deficit (193,797,560) (192,294,512)
------------ ------------
Total stockholders' equity 5,708,397 4,124,771
------------ ------------
Total liabilities and stockholders'
equity $ 8,010,198 $ 6,627,524
============ ============
LIGHTPATH TECHNOLOGIES, INC.
Condensed Consolidated Statements of Operations
Unaudited
Three months ended
September 30,
2007 2006
------------ ------------
Product sales, net $ 2,308,753 $ 4,386,323
Cost of sales 2,070,042 3,313,198
------------ ------------
Gross margin 238,711 1,073,125
Operating expenses:
Selling, general and administrative 1,436,857 1,274,776
New product development 308,480 265,247
Amortization of intangibles 8,217 8,217
------------ ------------
Total costs and expenses 1,753,554 1,548,240
------------ ------------
Operating loss (1,514,843) (475,115)
Other income (expense)
Interest expense (17,738) (10,966)
Investment and other income 29,533 31,212
------------ ------------
Net loss $ (1,503,048) $ (454,869)
============ ============
Loss per share (basic and diluted) $ (0.28) $ (0.10)
============ ============
Number of shares used in per share
calculation 5,323,511 4,479,117
============ ============
LIGHTPATH TECHNOLOGIES, INC.
Consolidated Statements of Cash Flows
Unaudited
Three Months Ended
September 30,
------------ ------------
2007 2006
------------ ------------
Cash flows due to operating activities
Net loss $ (1,503,048) $ (454,869)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization 103,962 119,622
Foreign exchange translation adjustment 20,796 -
Stock based compensation 58,746 56,994
Provision for doubtful accounts
receivable 63,050 13,520
Changes in operating assets and liabilities:
Trade receivables (7,195) (144,781)
Inventories 94,441 191,361
Prepaid expenses and other assets 73,835 38,310
Accounts payable and accrued expenses (155,420) (117,266)
------------ ------------
Net cash used in operating
activities (1,250,833) (297,109)
------------ ------------
Cash flows due to investing activities
Property and equipment additions (119,470) (324,572)
------------ ------------
Net cash used in investing
activities (119,470) (324,572)
Cash flows due to financing activities
Proceeds from exercise of stock options - 121
Proceeds from sale of common stock, net of
expenses 3,007,132 -
Borrowings on line of credit - 2,100
Payments on capital lease obligation (3,871) (3,387)
Payments on note payable (41,661) -
------------ ------------
Net cash provided by (used in) financing
activities 2,961,600 (1,166)
------------ ------------
Increase (Decrease) in cash and cash
equivalents 1,591,297 (622,847)
Cash and cash equivalents, beginning of period 1,291,364 3,763,013
------------ ------------
Cash and cash equivalents, end of period $ 2,882,661 $ 3,140,166
============ ============
Supplemental disclosure of cash flow
information:
Interest paid $ 7,787 $ 11,491
Stock issued under employee stock purchase
plan $ 24,887 $ 17,261
Contact Information: Contact: Dorothy Cipolla CFO LightPath Technologies, Inc. (407) 382-4003 Internet: www.lightpath.com