SALEM, NH--(Marketwired - Mar 25, 2014) -
ProPhotonix Limited
("ProPhotonix" or "the Company")
PRELIMINARY RESULTS FOR THE YEAR ENDED DECEMBER 31, 2013
ProPhotonix Limited (London Stock Exchange - AIM: PPIX and PPIR, OTC:
STKR), a designer and manufacturer of LED illumination systems and
laser diode modules with operations in Ireland and the United Kingdom,
today announces its unaudited preliminary results for the year ended
December 31, 2013.
Annual General Meeting
The Company will hold the Annual General Meeting of the Shareholders on
May 22, 2014 at 10:00 AM London Summer Time at the offices of K&L Gates
LLP, One New Change, London EC4M 9AF. The Record date is set at April
7, 2014 for all shareholders of record.
Financial Highlights
- Revenue increased 12% to $15.6 million
- Gross profit increased 38.6% to $6.0 million
- Gross profit margin improved to 38.3%
- Operating loss declined 62% to $1.2 million(1)
- EBITDA loss declined 73.8% to $0.7 million(1)
- Order bookings increased 17% to $17.6 million
- Backlog at December 31, 2013 of $6.9 million grew 31%
- Percentage revenue by market sectors: industrial 79%, medical
16%, and homeland security & defense 5%
- Percentage revenue by geography: 52% Europe, 31% North America
and 17% Rest of World
- On June 20, 2013, the Company secured new loan financing with net
availability of $2.5 million through an existing lender to the
Company alongside a new lender.
- On November 29, 2013, the Company entered into an amendment to an
existing revolving credit facility with Barclays Bank to increase
the existing credit facility from GBP650,000 ($1.1 million) to
GBP1,400,000 ($2.3 million) and extending the duration through the
minimum of November 30, 2015.
- Available borrowing capacity of $1.8 million from its loan
facilities at December 31, 2013
(1) Includes $582,000 non-recurring charges
Tim Losik, President & CEO, Commented:"During 2013 the Company experienced
an improvement in business
activity with order bookings increasing 17% and the December 31, 2013
backlog up 31% from December 31, 2012; ending 2013 with a book-to-bill
ratio of 1.13 (2012:1.08). Of particular note are the 69% increase in
bookings and 40% growth in revenue for the Americas region which has
been a significant regional growth focus. New customer activity is a
cornerstone for our growth and I am pleased that we are continuously
partnering with new customers. Revenue from new customers accounted
for $1.5 million of total revenue growth across several market sectors,
including: 3D Scanning for 3D printing, Warehouse Robotics, Transport
Container Monitoring and Inspection, Medical Devices, UV curing,
Aeronautics, and Industrial Automation and Inspection."The revenue increase
and cost reductions resulted in dramatic
improvement in operating performance and results. During the second
half of 2013, we realized significant improvement in operating
performance versus the first half 2013. Comparative improvements in the
second half 2013 versus first half 2013 (excluding the restructuring
and one-time charges of $582K in the first half) include: Operating
loss decreased 84% narrowing from ($517,000) to ($82,000) and EBITDA
improved 164% from a loss of ($275,000) to a positive EBITDA of
$177,000. However, these improvements were somewhat offset by
non-cash changes in foreign currency exchange rates and the resulting
increase in material purchase prices, and shifts in product mix;
thereby depressing second half gross profit. The improvements in
second half operating income and EBITDA are primarily the result of
reductions in general and administrative costs. We always seek to
mitigate the effects of shifts in the revenue mix, but predicting and
controlling this can be difficult."
Full Year 2013 Financial Results
Revenue for the year ended December 31, 2013 was $15.6 million, an
increase of 12% compared with $13.9 million in 2012. Gross profit was
$6.0 million compared to $4.3 million in 2012. Gross profit margin
increased to 38.3% from 31.0% in 2012 due to a shift in product mix and
an increase in volume.
Operating expenses, excluding intangible amortization charges, totaled
$7.0 million versus $7.3 million in 2012. Sales and marketing expenses
decreased 12% in 2013 over 2012, while general and administrative and
research and development expenses were approximately flat over the same
period and include restructuring and one-time charges of $0.6 million
taken in the first half of 2013. The operating loss was $1.2 million,
as compared to a $3.1 million loss in 2012 and EBITDA was a loss of
$0.7 million versus a loss of $2.6 million in 2012. Net loss was $1.2
million compared to the 2012 net loss of $2.9 million. Included in the
operating expenses, operating loss and EBITDA is approximately $0.6
million of restructuring and one-time charges.
Strategy and Markets
ProPhotonix consists of two business units: an LED systems
manufacturing business based in Ireland (Cork), and a laser modules
production and laser diode distribution business located in the United
Kingdom (Hatfield Broad Oak). Corporate headquarters and the North
American sales activities are based in Salem, New Hampshire, USA. The
fundamental strategy of the Company is growth in revenue through its
existing customers, new customer activity, and new product and market
expansion. ProPhotonix's short-term strategy is to reach sustained
positive EBITDA, cash flow, and net income as soon as possible. These
goals will be accomplished through a relentless focus on cost
management and most importantly through revenue growth.
ProPhotonix growth in the medium-term will be accomplished with new
customer wins with the conversion of development orders into longer run
orders, and also through expansion into new markets and with new
products. In addition to the few important areas where we are
currently focused, we will continuously evaluate additional high growth
opportunities by geography and business line.
ProPhotonix sells its products principally into three markets:
industrial (primarily machine vision illumination), medical, and
homeland security and defense. The Company foresees growth
opportunities in all three markets it serves which are briefly
described below:
Industrial (Machine Vision)
Within the industrial market, machine vision is the term used to
describe computerized analysis for controlling manufacturing processes,
for example automated inspection. In terms of quality and speed,
lighting is often a critical component in machine vision and the
Company manufactures both LED systems and lasers designed specifically
for this market. The recently enhanced 3D Pro Laser line generatorsand
improved LED line light family specifically address this market.
Medical
The Company has experienced successes in the medical (including dental)
market and has gained a foothold in the market, supplying a variety of
applications, with current customers including the world leader in
stationary imaging equipment, a portable x-ray equipment manufacturer,
a dental imaging manufacturer and also a pioneer in the manufacturing
of devices offering eye tracking capability utilizing ProPhotonix's
custom infrared LED arrays. The Company intends to broaden its product
marketing effort in the medical field since it offers significant
long-term revenue growth opportunities.
Homeland Security & Defense
LED systems, laser modules and laser diodes are used in a wide variety
of applications in the security and defense fields. The Company
currently supplies several defense sighting manufacturers in the US and
Europe, as well as leading manufacturers of Auto Number Plate
Recognition systems. This market offers significant growth
opportunities for ProPhotonix over the next several years and the
Company is currently marketing its laser and LED capabilities to
additional security and optical character recognition systems companies
in this market space.
Outlook
ProPhotonix begins 2014 with the strongest ever backlog at our business
units and with the necessary funding in place to move forward in 2014.
Included in 2013 bookings are about $800,000 of customer bookings
relating to new customer projects (non-recurring engineering
development), of which approximately $700,000 will be recognized
revenue in 2014. We expect to begin shipping trial and production
orders resulting from these projects during 2014 and thereafter. These
potential high volume OEM (custom) applications include illuminators
for the semiconductor, optical sorting, endoscopy, and vascular imaging
markets. We look forward to another year of progress in 2014 and expect
that first half revenue will be in the range of $7.8 and $8.2 million.
Enquiries:
ProPhotonix Limited Tel: +1 603 870 8220
Tim Losik, President and CEO ir@prophotonix.com
N+1 Singer Tel: +44 (0) 207 496 3000
Andrew Craig/ Ben Wright
Nominated Adviser and Broker
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 Oclaro, Osram,
QSI, Panasonic, and Sony. The Company serves a wide range of markets
including the machine vision, industrial inspection, security, and
medical markets. ProPhotonix has offices and subsidiaries in the U.S.,
Ireland, U.K., and Europe. For more information about ProPhotonix and
its innovative products, visit the Company's web site at
www.prophotonix.com .
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