SALEM, NH--(Marketwire - May 4, 2011) -
4 May 2011
ProPhotonix Limited
("ProPhotonix" or "the Company")
FIRST QUARTER TRADING UPDATE
ProPhotonix Limited, (London Stock Exchange - AIM: PPIX and PPIR, OTC:
STKR.PK), a designer and manufacturer of LED systems and laser modules
as well as a distributor of premium vendors' laser diodes, announces
its financial results for the first quarter ended March 31, 2011.
First-Quarter 2011 Financial Highlights:
* Revenue increased by 25% to $4.3 million (Q1 2010: $3.5 million),
up 24% adjusting for impact of currency fluctuation
* Revenue up 5% sequentially versus the fourth quarter of 2010
* Six consecutive quarters of sequential growth
* LED revenue increased 79% to $2.3 million (Q1 2010: $1.3
million)
* Gross profit increased 38% from $1.2 million to $1.6 million
* Gross margin 38.0% (Q1 2010: 34.2%) (Q4 2010: 39.0%)
* EBITDA profit of $29,000 vs. $247,000 loss in 2010, adjusted for
an abandoned facility charge, and a loss of $48,000 in Q4 2010,
adjusted for AIM expenses of $50,000
* Order bookings $4.9 million, ending backlog $6.4 million
* Percentage revenue by market sectors: industrial 80%, medical 14%
and homeland security & defense 6%;
* Percentage revenue by geography: 53% Europe, 38% North America
and 9% Rest of World
Mark W. Blodgett, Chairman & CEO, said: "I am pleased to announce
these results for the first quarter ended March 31, 2011. The Company
grew 25% year over year and 5% sequentially, marking the sixth straight
quarter of sequential revenue growth. Geographically, ProPhotonix
achieved improved sales in the North American market, where we had 53%
year over year growth, and 45% growth sequentially. We also achieved
continued growth in the European market led by strong sales to the
German solar equipment industry. The industrial and medical market
sales were up year over year at 35% and 9% respectively, however,
homeland security & defense sales were down 24% mainly due to lower
laser diode sales to one defense customer.""Order bookings at $4.9 million
were strong, particularly at the end of
the first quarter, which bodes well for continued growth, particularly
in the Company's LED business. Profitability improved measurably as
sales, general and administrative expenses were flat year over year and
the Company achieved EBITDA breakeven for the period compared to a $0.2
million loss the prior year first quarter."
Enquiries:
ProPhotonix Limited Tel: +44 (0)12 7971 7170
Mark W. Blodgett, CEO ir@prophotonix.com
Libertas Capital Corporate Finance Limited Tel: +44 (0)20 7569 9650
Andrew McLennan / Thilo Hoffmann
Cubitt Consulting Tel: +44 (0) 20 7367 5100
Chris Lane / Alice Coubrough
RD:IR Tel: +44 (0) 20 7492 0500
Isabel Richardson / Thomas Churchill
About ProPhotonix
ProPhotonix Limited, headquartered in Salem, New Hampshire, is an
independent designer and manufacturer of diode-based laser modules and
LED systems for industry leading OEMs and medical equipment companies.
In addition, the Company distributes premium diodes for Opnext, Sanyo &
Sony. The Company serves a wide range of markets including the machine
vision, industrial inspection, defense, sensors, and medical markets.
ProPhotonix has offices and subsidiaries in the U.S., Ireland, and
Europe. For more information about ProPhotonix and its innovative
products, visit the Company's web site at www.prophotonix.com .
First Quarter 2011 Financial Results
Total revenue for the first quarter of 2011 of $4.3 million increased
25 percent (up 24%, adjusting for currency) from the first quarter of
2010. The growth in revenue was comprised of an increase in the LED
segment of $1.0 million (+79%) over last year and a decrease in the
laser segment of approximately $0.1 million (-6%). The growth in
revenues is mainly attributable to increased activities in the U.S.A.
and Europe, where the Company saw year-on-year increases of
approximately 76% and 17% respectively. Bookings for the first quarter
of 2011 were $4.9 million and backlog was $6.4 million at March 31,
2011.
Gross profit was $1.6 million for the first quarter of 2011, an
increase of 38% compared to $1.2 million in the first quarter of 2010.
First quarter 2011 gross profit margin was 38.0% compared with 34.2% in
the comparable quarter in 2010 due to higher volumes, a more favorable
product mix, and productivity improvement initiatives.
Operating expenses, excluding amortization charges, totaled $1.8
million for the first quarter of 2011, an increase of 5% versus $1.7
million in the first quarter of 2010, net of the charges related to an
abandoned facility. General and Administrative expenses decreased
approximately $0.1 million, mainly due to a decrease in facility
depreciation costs related to the Salem facility, and decreased stock
compensation charges. Selling expenses increased $0.1 million, or 26%,
in line with the 25% revenue growth; while R&D expenses increased 56%,
or by approximately $0.1 million. The net loss from continuing
operations was $0.2 million as compared to a net operating loss of $0.6
million for the first quarter 2010, net of the charges related to the
abandoned facility.
EBITDA was $29,000 for the quarter as compared to a $247,000 loss for
the first quarter of 2010, net of a charge for an unused facility of
$0.1 million. Net loss of $0.3 million includes a gain on foreign
currency translation charges of $0.1 million. In comparison, the 2010
net loss was $1.3 million, which includes a loss on foreign currency
translation charges of approximately $0.3 million.
Outlook
The Company continues to exhibit significant improvement in its overall
financial performance versus last year as evidenced by a 79% increase
in the sales of the Company's LED products. LED products, particularly
those sold into medical and solar equipment industries, exhibit robust
gross margins, which when combined with higher revenue volumes and
improved capacity utilization, led to an overall improvement in gross
margin to 38% from 34% the prior year. Sales in the laser division
declined 6% year over year primarily due to higher sales of laser
diodes in the first quarter of 2010, which benefited from a last time
buy of several lines of discontinued diodes by an Asian diode
manufacturer. The significant improvement in gross profit represents a
significant accomplishment for the Company, which when combined with
lower corporate overhead and ongoing cost management led to a
significant improvement in overall financial operating performance.
Based on strong first quarter order bookings and six consecutive
quarters of sequential revenue growth and improved profitability, the
Company is well positioned for 2011.
SAFE HARBOR STATEMENT
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. All statements other than
statements of historical fact, including without limitation, those with
respect to ProPhotonix's goals, plans and strategies set forth herein
are forward-looking statements. The following important factors and
uncertainties, among others, could cause actual results to differ
materially from those described in these forward-looking statements:
uncertainty that cash balances may not be sufficient to allow
ProPhotonix to meet all of its business goals; uncertainty that
ProPhotonix's new products will gain market acceptance; the risk that
delays and unanticipated expenses in developing new products could
delay the commercial release of those products and affect revenue
estimates; the risk that one of our competitors could develop and bring
to market a technology that is superior to those products that we are
currently developing; and ProPhotonix's ability to capitalize on its
significant research and development efforts by successfully marketing
those products that the Company develops. Forward-looking statements
represent management's current expectations and are inherently
uncertain. All Company, brand, and product names are trademarks or
registered trademarks of their respective holders. ProPhotonix
undertakes no duty to update any of these forward-looking statements.
Use of Non-GAAP Financial Measures
The Company provides non-GAAP financial measures, such as EBITDA, to
complement its consolidated financial statements presented in
accordance with GAAP. Non-GAAP financial measures do not have any
standardized definition and, therefore, are unlikely to be comparable
to similar measures presented by other reporting companies. These
non-GAAP financial measures are intended to supplement the user's
overall understanding of the Company's current financial and operating
performance and its prospects for the future. Specifically, the
Company believes the non-GAAP results provide useful information to
both management and investors by identifying certain expenses, gains
and losses that, when excluded from the GAAP results, may provide
additional understanding of the Company's core operating results or
business performance, which management uses to evaluate financial
performance for purposes of planning for future periods. However, these
non-GAAP financial measures are not intended to supersede or replace
the Company's GAAP results.
The Company uses EBITDA (earnings before interest, taxes, depreciation,
amortization, stock-based compensation and impairment charges) as a
non-GAAP financial measure in this press release. A reconciliation of
EBITDA to net income / (loss) for the first quarter ended 2011 is as
follows:
Three Months
Ended
__________________
(in thousands)
March 31,
2011 2010
__________________
Net Loss (263) (1,319)
Loss from discontinued operations 49 59
Plus:
Interest and other expense (net) 21 522
Depreciation 78 122
Intangible asset amortization 81 99
Stock based compensation 63 120
Tax benefit - (64)
Amortization of Debt Discount & Financing Costs - 99
_________________
EBITDA Profit / (Loss) 29 (362)
_________________
Charges related to abandoned lease - 115
_________________
Adjusted EBITDA Profit / (Loss) 29 (247)
_________________
Consolidated Statements of Operations
($ In thousands except share and per share data)
(unaudited)
Three Months Ended
March 31,
2011 2010
Net Sales $4,338 $3,482
Cost of Sales 2,690 2,290
_________ ______________
Gross Profit 1,648 1,192
_________ ______________
Research & Development Expenses 239 153
Selling, General & Administrative 1,521 1,643
Expenses
Amortization of Intangible Assets 81 99
_________ ______________
Operating Loss (193) (703)
_________ ______________
Other Income / (Expense), net 75 (328)
Amortization of Debt Discount and
Financing Costs - (99)
Interest Expense (96) (194)
_________ ______________
Loss Before Taxes from Continuing (214) (1,324)
Operations
Tax Benefit - (64)
_________ ______________
Net Loss from Continuing Operations (214) (1,260)
Loss from Discontinued Operations (49) (59)
_________ ______________
Net Loss $ (263) $ (1,319)
_________ ______________
Loss Per Share
Loss from Continuing Operations ($0.01) ($0.03)
Loss from Discontinued Operations ($0.00) ($0.00)
_________ ______________
Net loss per share ($0.01) ($0.03)
_________ ______________
Weighted Average Shares Outstanding 52,351,650 44,163,269
_________________________________________________________________
PROPHOTONIX LIMITED
CONSOLIDATED BALANCE SHEETS
In thousands except share and per share data
Unaudited
March 31, December 31,
2011 2010
_______________ _______________
Assets
Current assets:
Cash and cash equivalents $ 1,029 $ 1,811
Accounts receivable less
allowances of $34 at
March 31, 2011 and $47 at
December 31, 2010 2,240 2,023
Inventories 2,086 1,892
Prepaid expenses and other
current assets 234 229
_______________ _______________
Total current assets 5,589 5,955
Net property, plant and
equipment 901 906
Goodwill 498 468
Acquired intangible assets,
net 551 610
Other long-term assets 61 66
_______________ _______________
Total assets $ 7,600 $ 8,005
_______________ _______________
Liabilities and
Stockholders' Deficit
Current liabilities:
Revolving credit facility $ 802 $ 641
Current portion of
long-term debt 600 600
Current portion of capital
lease obligations 17 24
Accounts payable 1,831 2,003
Accrued expenses 1,256 1,368
_______________ _______________
Total current liabilities 4,506 4,636
Long-term debt, net of
current portion 3,424 3,407
Other long-term liabilities 178 150
_______________ _______________
Total liabilities 8,108 8,193
_______________ _______________
Stockholders' deficit:
Common stock, par value
$0.001; shares authorized
100,000,000; 52,510,174
shares issued and
outstanding at March 31,
2011 and December 31, 2010 53 53
Paid-in capital 105,741 105,678
Accumulated other
comprehensive income 136 256
Accumulated deficit (106,438) (106,175)
_______________ _______________
Total stockholders' deficit (508) (188)
_______________ _______________
Total liabilities and
stockholders' deficit $ 7,600 $ 8,005
_______________ _______________
PROPHOTONIX LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
Unaudited
($ In thousands)
Three Months Ended
March 31,
________________________
2011 2010
___________ __________
Operations
Net loss $ (263) $ (1,319)
Loss from discontinued operations, net of
tax (49) (59)
___________ __________
Loss from continuing operations (214) (1,260)
Adjustments to reconcile net loss to net
cash used in operating activities:
Stock based compensation 63 120
Depreciation and amortization 159 222
Amortization of debt discount and financing
costs - 99
Provision for inventories 9 7
Provision for bad debts - 4
Deferred income taxes - (64)
Other change in assets and liabilities:
Accounts receivable (113) (640)
Inventories (112) (48)
Prepaid expenses and other current assets 3 50
Accounts payable (258) 322
Accrued expenses (157) (101)
___________ __________
Net cash used in operating activities (592) (1,289)
Net cash used in discontinued operations (49) (59)
___________ __________
Net cash used in operating activities (641) (1,348)
Financing
Borrowing of revolving credit facility 137 304
Principal repayment of long-term debt (157) (903)
___________ __________
Net cash used in financing activities (20) (599)
Investing
Payment of financing obligation - (36)
Purchase of plant and equipment (32) (15)
___________ __________
Net cash used in investing activities (32) (51)
Effect of exchange rate on cash (89) 355
___________ __________
Net change in cash and equivalents (782) (1,643)
Cash and equivalents, beginning of period 1,811 4,478
___________ __________
Cash and equivalents, end of period $ 1,029 $ 2,835
___________ __________
Supplemental disclosure of cash flow
information:
Cash paid for interest $ 96 $ 190
Cash paid for taxes $ 15 $ -
This information is provided by RNS
The company news service from the London Stock Exchange
END
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