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Last updated on April 19, 2014 at 1:20 EDT

LightPath Technologies Announces Profitable Fourth Quarter

August 30, 2012

ORLANDO, Fla., Aug. 30, 2012 /PRNewswire/ — LightPath Technologies, Inc. (NASDAQ: LPTH) (“LightPath”, the “Company” or “we”), a global manufacturer, distributor and integrator of proprietary optical components and high-level assemblies, announced today its financial results for the fourth quarter and fiscal year ended June 30, 2012.

(Logo: http://photos.prnewswire.com/prnh/20120202/FL45310LOGO )

Fourth Quarter Highlights:

  • Net Income was $196,000, or $0.02 per share for the quarter compared to $429, or $0.00 per share in the fourth quarter of fiscal 2011.
  • 12-month backlog was $4.89 million as of June 30, 2012, an increase of 26% or $1.02 million from June 30, 2011.
  • Revenue for the fourth quarter of fiscal 2012 increased 11% to $3.10 million compared to $2.78 million for the fourth quarter of fiscal 2011.
  • Gross margin for the quarter remained at 40% as compared to the fourth quarter of fiscal 2011.
  • EBITDA increased 72% to $485,000 compared to $281,000 in the fourth quarter of fiscal 2011.
  • Cash on hand as of June 30, 2012 was $2.35 million as compared to $929,000 on June 30, 2011.

Jim Gaynor, President and Chief Executive Officer of LightPath, commented, “I am pleased to report top-and bottom-line improvement for our fourth quarter, driven by strength in demand for our custom optics and in particular our products designed for the telecom markets. Gross margin improved over each of the previous two quarters by 25% and has returned to 40%, due in part to cost reductions we implemented in April 2012 and an increase in revenue. EBITDA increased by 72% to $485,000 and we had positive operating cash flow for the fourth quarter of $309,000 before taking into account the proceeds we raised in our June 2012 private placement. The combination of increased sales volume and lower costs resulted in net income of $196,000, our highest quarterly net income since the fourth quarter of fiscal 2010. For the year, we demonstrated strong operating leverage with increases in both EBITDA and sales, and we reduced our net loss by 46%.”

Mr. Gaynor added, “LightPath has increased its revenue and grown its backlog during a challenging period of uncertainty and weakness in the broader markets in which we do business. We continue to serve our markets well, and we expect to continue our growth given the opportunities we see ahead for not only our core business in precision molding, but particularly in the infrared markets. Our recently completed private placement has provided us with the opportunity to add the appropriate capacity to bring our exciting next generation of infrared products to market, and we are currently in the process of adding the equipment that will enable us to capitalize on diverse opportunities that we see ahead for such products and technology.”

Financial Results for Three Months Ended June 30, 2012

Revenue for the fourth quarter of fiscal 2012 totaled approximately $3.10 million compared to approximately $2.78 million for the fourth quarter of fiscal 2011, an increase of 11%. This increase was primarily attributable to revenue from the Company’s telecom products and custom optics which includes revenue from a large purchase order from the Raytheon Vision Systems (“Raytheon”). Growth in sales for the next several quarters is expected to be derived primarily from the precision molded lenses product line, particularly low cost lenses being sold in Asia and from infrared and collimator products. Infrared products, now being designed and introduced are expected to accelerate the Company’s growth more meaningfully beginning in fiscal 2013 and continuing in fiscal 2014.

The gross margin percentage in the fourth quarter of fiscal 2012 was 40%, unchanged compared to the fourth quarter of fiscal 2011. Total manufacturing costs of $1.88 million increased by approximately $209,000 in the fourth quarter of fiscal 2012 compared to the same period of the prior fiscal year due to increased revenues. Direct costs, which include material, labor and services, were 22% of revenue in the fourth quarter of fiscal 2012, as compared to 30% of revenue in the fourth quarter of fiscal 2011.

During the fourth quarter of fiscal 2012, total costs and expenses increased by approximately $22,000 compared to the same period of the prior year. Selling, general and administrative expenses were $860,000 for the fourth quarter of fiscal 2012. Total operating income for the fourth quarter of fiscal 2012 was approximately $111,000 compared to $22,000 for the same period in fiscal 2011.

Net income for the fourth quarter of fiscal 2012 was $196,000 or $0.02 per basic and diluted common share, compared with a net income of $429 or $0.00 per basic and diluted common share for the same period in fiscal 2011. Weighted-average basic shares outstanding increased to 10,384,899 in the fourth quarter of fiscal 2012 compared to 9,714,156 in the fourth quarter of fiscal 2011 which is primarily due to the issuance of shares of common stock in the June 2012 private placement, shares issued for the payment of interest on our convertible debentures, the shares issued for our employee stock purchase plan and the shares issued upon the exercise of incentive stock options.

Financial Results for Year Ended June 30, 2012

Revenue for fiscal year 2012 was approximately $11.28 million compared to approximately $10.00 million for fiscal 2011, an increase of 13%. This increase was primarily attributable to revenue from the Raytheon purchase order, and sales of precision molded lenses for the telecom and laser tool markets and custom optics. The number of units of precision molded optics sold increased by 13% due to the Company’s continuing pursuit of the low-cost, high-volume lens business. Growth in sales going forward is expected to be derived primarily from LightPath’s precision molded optics product line, particularly its low cost lenses sold in Asia, and its infrared and collimator product lines.

Gross margin percentage for fiscal year 2012 decreased to 36% compared to 39% in fiscal 2011. Total manufacturing costs of $7.25 million were approximately $1.17 million higher in fiscal 2012 compared to the prior fiscal year. This increase in manufacturing costs resulted from a $576,000 increase in direct costs for materials, labor and outside services due to an increase in revenues, a $171,000 increase in labor costs for our collimator and infrared products as we continue to ramp up the development of these products, and a $293,000 increase in tooling costs. Direct costs, which include material, labor and services, were 25% of revenue in fiscal year 2012, as compared to 27% of revenue in fiscal year 2011.

During fiscal year 2012, total costs and expenses increased $180,000 to approximately $4.96 million compared to approximately $4.78 million for fiscal year 2011. As a result, total operating loss for fiscal year 2012 increased to a loss of approximately $924,000 compared to a loss of $857,000 for fiscal year 2011.

Net loss for fiscal year 2012 was approximately $865,000 or $0.09 per basic and diluted common share, compared with a net loss of approximately $1.60 million or $0.17 per basic and diluted common share for fiscal year 2011. Weighted-average basic shares outstanding increased to 9,861,596 in fiscal year 2012 compared to 9,533,558 in fiscal year 2011, which is primarily due to the issuance of shares of common stock in the June 2012 private placement, the shares issued as payment of interest due on the Company’s convertible debentures and the shares issued for our employee stock purchase plan.

Cash and cash equivalents totaled approximately $2.35 million as of June 30, 2012. The current ratio as of June 30, 2012 was 3.59 to 1 compared to 3.01 to 1 as of June 30, 2011. Total stockholders’ equity as of June 30, 2012 totaled approximately $4.00 million compared to $4.04 million as of June 30, 2011.

As of June 30, 2012, our 12-month backlog, was $4.89 million compared to $3.87 million as of June 30, 2011.

Investor Conference Call and Webcast Details:

LightPath will host an audio conference call and webcast on Thursday, August 30th at 4:30 p.m. EDT to discuss the Company’s financial and operational performance for the fourth quarter of fiscal 2012.

Conference Call Details

Date: Thursday, August 30, 2012
Time: 4:30p.m. (EDT)
Dial-in Number: 1-877-407-8033
International Dial-in Number: 1-201-689-8033

It is recommended that participants dial-in approximately 5 to 10 minutes prior to the start of the 4:30 p.m. call. A transcript archive of the webcast will be available for viewing or download on the company web site shortly after the call is concluded.

About LightPath Technologies

LightPath manufactures optical products including precision molded aspheric optics, GRADIUM® glass products, proprietary collimator assemblies, laser components utilizing proprietary automation technology, higher-level assemblies and packing solutions. The Company’s products are used in various markets, including industrial, medical, defense, test and measurement and telecommunications. LightPath has a strong patent portfolio that has been granted or licensed to it in these fields. For more information visit www.lightpath.com.

The discussions of our results as presented in this release include use of non-GAAP terms “EBITDA” and “gross margin.” Gross margin is determined by deducting the cost of sales from operating revenue. Cost of sales includes manufacturing direct and indirect labor, materials, services, fixed costs for rent, utilities and depreciation, and variable overhead. Gross margin should not be considered an alternative to operating income or net income, which is determined in accordance with Generally Accepted Accounting Principles (“GAAP”). We believe that gross margin, although a non-GAAP financial measure is useful and meaningful to investors as a basis for making investment decisions. It provides investors with information that demonstrates our cost structure and provides funds for our total costs and expenses. We use gross margin in measuring the performance of our business and have historically analyzed and reported gross margin information publicly. Other companies may calculate gross margin in a different manner.

EBITDA is a non-GAAP financial measure used by management, lenders and certain investors as a supplemental measure in the evaluation of some aspects of a corporation’s financial position and core operating performance. Investors sometimes use EBITDA as it allows for some level of comparability of profitability trends between those businesses differing as to capital structure and capital intensity by removing the impacts of depreciation, amortization, loss on extinguishment of debt and interest expense. EBITDA also does not include changes in major working capital items such as receivables, inventory and payables, which can also indicate a significant need for, or source of, cash. Since decisions regarding capital investment and financing and changes in working capital components can have a significant impact on cash flow, EBITDA is not a good indicator of a business’s cash flows. We use EBITDA for evaluating the relative underlying performance of the Company’s core operations and for planning purposes. We calculate EBITDA by adjusting net loss to exclude net interest expense, income tax expense or benefit, depreciation and amortization, thus the term “Earnings Before Interest, Taxes, Depreciation and Amortization” and the acronym “EBITDA.”

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, including statements regarding our ability to expand our presence in certain markets, future sales growth, continuing reductions in cash usage and implementation of new distribution channels. 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. Except as required under the federal securities laws and the rules and regulations of the Securities and Exchange Commission, we do not have any intention or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

                                                                           LIGHTPATH TECHNOLOGIES, INC.
                                                                            Consolidated Balance Sheets

                                                                                                            June 30,                                            June 30,
                             Assets                                                                                          2012                                                2011
                                                                                                                             ----                                                ----
    Current assets:
                      Cash and cash
                      equivalents                                                $2,354,087                                            $928,900
                      Trade accounts
                      receivable, net of
                      allowance of $18,214
                      and $7,245                                                  2,133,079                                           1,833,044
                     Inventories, net                                             1,513,384                                           1,622,637
                     Other receivables                                               41,000                                              30,943
                      Prepaid interest
                      expense                                                         7,250                                               7,250
                      Prepaid expenses and
                      other assets                                                  201,459                                             189,630
                                            Total current assets                                                        6,250,259                                           4,612,404

                      Property and
                      equipment, net                                              1,920,950                                           2,373,022
                     Intangible assets, net                                            68,265                                             101,133
                     Debt costs, net                                                  3,882                                               7,180
                     Other assets                                                    27,737                                              27,737
                                            Total assets                                                               $8,271,093                                          $7,121,476
                                                                                                                       ==========                                          ==========
                             Liabilities and Stockholders' Equity
    Current liabilities:
                     Accounts payable                                            $1,129,708                                            $928,790
                     Accrued liabilities                                            183,910                                             123,705
                      Accrued payroll and
                      benefits                                                      386,234                                             481,318
                     Deferred revenue                                                37,750                                                   -
                      Capital lease
                      obligation, current
                      portion                                                         3,602                                                   -

                                            Total current liabilities                                                   1,741,204                                           1,533,813

    Capital lease obligation                                                                                                6,903                                                   -
    Deferred rent                                                                                                         345,726                                             464,262
    Warrant liability                                                                                                   1,087,296                                                   -
    8% convertible debentures to related parties                                                                        1,012,500                                           1,012,500
    8% convertible debentures                                                                                              75,000                                              75,000
                                                                                                                                                                               ------
                               Total
                               liabilities                                         4,268,629                                           3,085,575
                                                                                   ---------                                           ---------

    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;
                      40,000,000 shares
                      authorized; 11,711,952
                      and 9,713,099
                      shares issued and
                      outstanding,
                      respectively                                                  117,120                                              97,131
                      Additional paid-in
                      capital                                                   208,410,216                                         207,636,440
                      Accumulated other
                      comprehensive income                                            88,258                                              50,593
                     Accumulated deficit                                      (204,613,130)                                       (203,748,263)
                                            Total stockholders' equity                                                  4,002,464                                           4,035,901
                                                                                                                        ---------                                           ---------
                                             Total liabilities and
                                             stockholders' equity                                                      $8,271,093                                          $7,121,476
                                                                                                                       ==========                                          ==========
                                                                                              LIGHTPATH TECHNOLOGIES, INC.

                                                                             Consolidated Statements of Operations and Comprehensive Income

                                        (unaudited)
                                                                                                                                                 Three months ended
                                                                                                                                                                                                    Year ended
                                                                                                                                                      June 30,                                       June 30,
                                                                                                                                                     2012                      2011                      2012                         2011
                                                                                                                                                     ----                      ----                      ----                         ----
    Product sales, net                                                                                                                         $3,104,120                $2,784,550                11,284,869                  $10,000,602
    Cost of sales                                                                                                                               1,875,505                 1,666,656                 7,250,098                    6,078,829
                                                                                                                                                ---------                 ---------                 ---------                    ---------
                                                                                  Gross margin                                                  1,228,615                 1,117,894                 4,034,771                    3,921,773
    Operating expenses:
                             Selling, general and administrative                                                                  859,798                    842,065                 3,880,667                   3,771,643
                             New product development                                                                              249,641                    258,249                 1,045,535                     995,087
                             Amortization of intangibles                                                                            8,217                      8,217                    32,868                      32,868
                              Gain on sale of property and
                              equipment                                        -                                                                  (12,729)                        -                   (20,480)
                             -----------------------------
                                                                                  Total costs and expenses                                      1,117,656                 1,095,802                 4,959,070                    4,779,118
                                                                                                                                                ---------                 ---------                 ---------                    ---------
                                                                                  Operating income (loss)                                         110,959                    22,092                  (924,299)                    (857,345)
    Other income (expense):
                             Interest expense                                                                                     (21,809)                   (22,171)                  (88,729)                   (170,585)
                             Interest expense - debt discount                  -                                                                     (103)                        -                  (316,693)
                             Interest expense - debt costs                                                                           (850)                      (784)                   (3,298)                   (118,977)
                             Loss on extinguishment of debt                    -                                                                        -                         -                  (131,784)
                              Change in fair value of warrant
                              liability                                  103,364                                                                        -                   103,364                         -
                             Other income (expense), net                                                                            4,200                      1,395                    48,095                      (6,579)
                                                                                                                                     -----
                             Total other expense, net                                                                              84,905                    (21,663)                   59,432                    (744,618)
                                                                                                                                    ------
                                                               Net income (loss)                                                  $195,864                       $429                 $(864,867)                $(1,601,963)
                                                                                                                                  ========                       ====                 =========                 ===========
    Income (loss) per common share (basic)                                                                                                          $0.02                     $0.00                    $(0.09)                      $(0.17)
                                                                                                                                                    =====                     =====                    ======                       ======
    Number of shares used in per share calculation                                                                                             10,384,899                 9,714,156                 9,861,596                    9,533,558
                                                                                                                                               ==========                 =========                 =========                    =========
    (basic)
    Income (loss) per common share (diluted)                                                                                                        $0.02                     $0.00                    $(0.09)                      $(0.17)
                                                                                                                                                    =====                     =====                    ======                       ======
    Number of shares used in per share calculation                                                                                             11,311,701                10,333,828                 9,861,596                    9,533,558
                                                                                                                                               ==========                ==========                 =========                    =========
    (diluted)
    Foreign currency translation adjustment                                                                                                        16,531                    29,406                    37,665                       27,127
                                                                                                                                                                                                       ------                       ------
                           Comprehensive income (loss)                                                                                           $212,395                   $29,835                 $(827,202)                 $(1,574,836)
                                                                                                                                                 ========                   =======                 =========                  ===========

                               LIGHTPATH TECHNOLOGIES, INC.
                          Consolidated Statements of Cash Flows

                                   Year ended
                                    June 30,
                                    --------
                                                    2012               2011
                                                    ----               ----
    Cash flows
     from
     operating
     activities
    Net loss                                   $(864,867)       $(1,601,963)
    Adjustments
     to
     reconcile
     net loss to
     net cash
     provided by
     (used in)
     operating
     activities:
         Depreciation
         and
         amortization                          1,124,038            912,929
        Interest
         from
         amortization
         of debt
         discount                                      -            316,693
        Interest
         from
         amortization
         of debt
         costs                                     3,298            118,977
        Warrants
         issued to
         consultant                                7,500                  -
        Gain on
         sale of
         property
         and
         equipment                                     -            (20,480)
        Stock based
         compensation                            272,044            246,149
        Change in
         provision
         for
         doubtful
         accounts
         receivable                               10,969            (15,685)
        Change in
         value of
         warrant
         liability                              (103,364)                 -
        Deferred
         rent                                   (118,536)          (105,024)
        Loss on
         extinguishment
         of debt                                       -            131,784
    Changes in
     operating
     assets and
     liabilities:
      Trade
       accounts
       receivables                              (311,004)           (13,296)
      Other
       receivables                               (10,057)           (30,943)
      Inventories                                109,253           (484,959)
      Prepaid
       expenses
       and other
       assets                                     82,671            194,663
      Accounts
       payable
       and
       accrued
       liabilities                               166,039            446,057
      Deferred
       revenue                                    37,750                  -
                                                  ------
              Net cash
               provided
               by
               operating
               activities                        405,734             94,902
                                                 -------             ------
    Cash flows
     from
     investing
     activities
    Purchase of
     property
     and
     equipment                                  (628,593)          (908,391)
    Proceeds
     from sale
     of
     equipment                                         -             20,480
              Net cash
               used in
               investing
               activities                       (628,593)          (887,911)
                                                --------           --------
    Cash flows
     from
     financing
     activities
      Proceeds
       from
       exercise
       of stock
       options                                         -              7,634
      Proceeds
       from sale
       of common
       stock, net
       of costs                                1,596,786                  -
      Proceeds
       from sale
       of common
       stock from
       employee
       stock
       purchase
       plan                                       13,595             12,137
      Costs
       associated
       with
       conversion
       of
       debentures                                      -             (6,749)
      Repayments
       of
       debentures                                      -            (14,250)
      Exercise of
       warrants                                        -            231,659
                                                     ---            -------
              Net cash
               provided
               by
               financing
               activities                      1,610,381            230,431
    Effect of
     exchange
     rate on
     cash and
     cash
     equivalents                                  37,665             27,127
                                                  ------             ------
    Increase
     (decrease)
     in cash
     and cash
     equivalents                               1,425,187           (535,451)
    Cash and
     cash
     equivalents,
     beginning
     of period                                   928,900          1,464,351
                                                 -------          ---------
    Cash and
     cash
     equivalents,
     end of
     period                                   $2,354,087           $928,900
                                              ==========           ========

     Supplemental
     disclosure
     of cash
     flow
     information:
      Interest
       paid in
       cash                                       $1,670             $2,236
      Income
       taxes paid                                  4,174              4,429
     Supplemental
     disclosure
     of non-
     cash
     investing
     &
     financing
     activities:
        Convertible
         debentures
         converted
         into common
         stock                                       $ -           $832,500
        Prepaid
         interest
         on
         convertible
         debentures
         through
         the
         issuance
         of                                       87,000                  -
    common
     stock
        Fair value
         of
         warrants
         issued to
         consultant                               15,000                  -
        Premium
         from debt
         exchange
         for common
         stock                                         -             42,719
                                                                                                LIGHTPATH TECHNOLOGIES, INC.

                                                                                       Consolidated Statement of Stockholders' Equity

                                                                                                                                        Accumulated
                                                                                                                        Class A           Additional     Other                                            Total
                                                                          Common Stock                                  Paid-in         Comprehensive Accumulated             Stockholders'
                                                                             Shares                              Amount       Capital     Income      Deficit                  Equity
                                                                             ------                              ------       -------     ------      -------                  ------
    Balance at June 30, 2010                                                                                     8,971,638      $89,716 $206,277,806                 $23,466            $(202,146,300) $4,244,688

    Issuance of common stock for:
                                            Employee Stock Purchase Plan                                             7,854           78       12,059                       -                        -      12,137
                                            Exercise of employee stock options                                       7,270           73        7,560                       -                        -       7,633
                                            Conversion of debentures, net of costs                                 540,592        5,406      820,346                       -                        -     825,752
                                            Cashless exercise of warrants                                           56,695          567         (567)                      -                        -           -
                                            Exercise of warrants                                                   129,050        1,291      230,368                       -                        -     231,659
    Stock based compensation on stock
                                            options and restricted stock units                                           -            -      246,149                       -                        -     246,149
    Premium from debt exchange              -                                                                            -       42,719            -                       -                   42,719
    Net loss                                -                                                                            -            -            -              (1,601,963)              (1,601,963)
    Foreign currency translation adjustment -                                                                            -            -       27,127                       -                   27,127
                                            ---                                                                        ---          ---       ------                     ---                   ------
    Balance at June 30, 2011                                                                                     9,713,099      $97,131 $207,636,440                 $50,593            $(203,748,263) $4,035,901
    Issuance of common stock for:
                                            Employee stock purchase plan                                            13,169          132       13,463                       -                        -      13,595
                                            Interest payment on convertible debentures                              41,832          418       86,582                       -                        -      87,000
    Warrant issued for consulting services  -                                                                            -       15,000            -                       -                   15,000
    Stock based compensation on stock
                                            options and restricted stock units                                           -            -      272,044                       -                        -     272,044
    Sale of common stock and warrants, net                                                                       1,943,852       19,439      386,687                       -                        -     406,126
    Net loss                                                                                               -             -            -            -                (864,867)                (864,867)
    Foreign currency translation adjustment                                                                -             -            -       37,665                       -                   37,665
    Balance at June 30, 2012                                                                                    11,711,952     $117,120 $208,410,216                 $88,258            $(204,613,130) $4,002,464
                                                                                                                ==========     ======== ============                 =======            =============  ==========
                                                                     LIGHTPATH TECHNOLOGIES, INC.

                                                                                          EBITDA

                                        (Unaudited)
                                    Three months ended
                                                                        Year ended
                                         June 30,                        June 30,
                                                        2012                            2011                  2012                 2011
                                                        ----                            ----                  ----                 ----

     Net income
     (loss)                $195,864                             $429                           $(864,867)          $(1,601,963)
     Depreciation
     and
     amortization           266,317                          257,798                           1,124,038               912,929
     Loss on
     extinguishment
     of debt                      -                                -                                   -               131,784
     Interest
     expense                 22,659                           23,058                              92,027               606,255
                    EBITDA                          $484,840                        $281,285              $351,198              $49,005
                                                    ========                        ========              ========              =======
    Contacts:
    Jim Gaynor, President & CEO  Dorothy Cipolla, CFO
    LightPath Technologies, Inc. LightPath Technologies, Inc.
    Tel: 407-382-4003            Tel: 407-382-4003 x305
    Email: jgaynor@lightpath.com Email: dcipolla@lightpath.com
    Web: www.lightpath.com       Web: www.lightpath.com

    Brett Maas, Managing Partner
    Hayden IR
    Tel: 646-536-7331
    Email: Brett@haydenir.com
    -------------------------
    Web: www.haydenir.com
    ---------------------

SOURCE LightPath Technologies, Inc.


Source: PR Newswire