- Q4 Revenues Increase 13%; Q4 Operating Expenses Decline
34%
- Unveils 2.6K 1.3” Diagonal and 20,000 Nit Green OLED
Micro Displays At CES 2020
Kopin Corporation (NASDAQ: KOPN), a leading provider of
innovative wearable computing technologies and solutions, today
provided an update on its business initiatives and reported
financial results for the fourth quarter and full year ended
December 28, 2019.
“We ended the year on a solid note, with our military business
again driving growth, along with continued strength from selected
public safety customers,” said Dr. John C.C. Fan, CEO of Kopin
Corporation. “Revenue from the F-35 Fighter jet and FWS-I programs
were the largest component of our military business for both Q4 and
for the full year. We also began shipping to fulfill our new FWS-I
contract, and expect its sister program, the FWS-C, to reach
production levels in late 2020. We look for these programs to
continue expanding through the year while other programs finish
development and move into production. Currently we have over 10
military programs in various stages of either production or
advanced development. While some of these may not contribute
significantly to product revenue for the next year or two, and we
can’t be sure all will reach production after moving through
development, this is by far the strongest military program
portfolio in Kopin’s history, and we see additional opportunities
ahead.
“Our public safety business continues to ramp, as companies
increasingly realize that augmented reality (AR) offers significant
benefits for first responders. The ability to use our technology in
a helmet allows a firefighter, for example, to keep his hands free
while critical information is displayed in front of him, increasing
safety and efficiency. We look for these critical applications to
expand in the coming years.”
Dr. Fan continued, “At CES in January we were pleased with the
reception to our new 2.6K resolution 1.3” diagonal OLED
micro-display which was developed with our partners Panasonic and
Lakeside. We also debuted a super-bright monochrome green duo-stack
OLED display. The green display emits 20,000 nits and boasts a wide
dynamic range, making its use possible in environments ranging from
bright sunlight to pitch black, yet with low power consumption. We
believe there are numerous applications for this unique technology
and are beginning to engage with potential customers.
“We have made excellent progress in reducing our cost structure.
In the second half of the year, R&D and SG&A expenses
declined by 39% and 17%, respectively, as compared to the first
half of 2019, even as we commercialized products and continued
development on projects such as our new OLED displays. We will
continue working to refine our cost structure and believe our
current cash and marketable securities position should be
sufficient to fund our operations in 2020. As previously announced,
Kopin received a notice from Nasdaq that the Company is not in
compliance with Nasdaq's minimum bid price listing rules. While our
shareholders have approved a reverse stock split, we expect to
request an extension from Nasdaq to enable all options.”
Dr. Fan concluded, “The coronavirus or COVID-19, is affecting
the delivery of some components we procure from China. Although it
has not yet had a significant effect on our operations, we are
working with our suppliers to establish alternative sources for
these components as a contingency plan. As such we are currently
forecasting an increase in military revenues in 2020 as compared to
2019 but this is expected to be partially offset by lower demand
from our industrial customers.”
Fourth Quarter Financial Results
Total revenues for the fourth quarter ended December 28, 2019
were $8.7 million, compared with $7.7 million for the fourth
quarter ended December 29, 2018, a 13% increase year over year.
Research and development (R&D) expenses for the fourth
quarter of 2019 were $2.7 million compared to $3.9 million for the
fourth quarter of 2018, a 31% decrease year over year.
Selling, general and administrative (SG&A) expenses were
$4.5 million for the fourth quarter of 2019, compared to $6.2
million for the fourth quarter of 2018, a 27% decrease year over
year. SG&A in the fourth quarter of 2019 included $0.2 million
in non-cash stock-based compensation.
The net loss attributable to controlling interest for the fourth
quarter of 2019 was $7.3 million, or $0.9 per share, compared with
net loss of $10.0 million, or $0.14 per share, for the fourth
quarter of 2018. The fourth quarter of 2019 included a net
write-down of equity investments of $4.6 million. The fourth
quarter of 2018 included a non-cash impairment charge to goodwill
and a non-cash write-down of fixed assets of $3.9 million.
Full Year Results
Total revenue for the twelve months ended December 28, 2019 was
$29.5 million, a 21% increase, compared to $24.5 million for
2018.
Research and development expenses for 2019 were $13.3 million, a
23% decrease compared with $17.4 million in 2018.
Selling, general and administrative expenses were $21.3 million
in 2019, a 22% decrease compared with $27.2 million in 2018.
The net loss from controlling interest for the year ended
December 28, 2019 was $29.5 million or $0.37 per share, versus a
net loss of $34.5 million or $0.47 per share for 2018. The full
year 2019 included a non-cash impairment charge to goodwill of $0.3
million and a net write-down of equity investments of $3.9 million.
The full year 2018 included a non-cash impairment charge to
goodwill and a non-cash write-down of fixed assets of $3.9 million
and a non-cash gain of $2.8 million from the mark to market of a
warrant we received from a company that licensed intellectual
property from us.
Kopin’s cash and equivalents and marketable securities were
approximately $21.8 million at December 28, 2019 as compared to
$37.2 million at December 29, 2018, with no long-term debt.
During 2019 Kopin had 27 new patents granted and filed for five
new applications. Kopin has over 200 patents and patents pending,
almost all of which are related to wearable applications.
All amounts above are estimates and readers should refer to our
Form 10-K for the year ended December 28, 2019, for final
disposition as well as important risk factors.
Conference Call
Kopin will host a conference call this morning at 8:30am ET. To
participate, please dial 800-263-0877 (U.S. and Canada) or
323-794-2094 (International). The call will also be available as a
live and archived audio webcast on the Investor Relations section
of Kopin’s website at www.kopin.com.
About Kopin
Kopin Corporation is a leading developer and provider of
innovative wearable technologies and critical components for
integration into wearable computing systems for military,
industrial and consumer products. Kopin's technology portfolio
includes ultra-small displays, optics, speech enhancement
technology, and low-power ASICs. For more information, please visit
Kopin's website at www.kopin.com.
Forward-Looking Statements
Statements in this press release may be considered
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended (the “Securities Act”), and
Section 21E of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), which are subject to the safe harbor created by
such sections. Words such as “expects,” “believes,” “can,” “will,”
“estimates,” and variations of such words and similar expressions,
and the negatives thereof, are intended to identify such
forward-looking statements. We caution readers not to place undue
reliance on any such “forward-looking statements,” which speak only
as of the date made, and advise readers that these forward-looking
statements are not guarantees of future performance and involve
certain risks, uncertainties, estimates, and assumptions by us that
are difficult to predict. These forward-looking statements may
include statements with respect to: our expectation that the FWS-C
will reach production levels in late 2020; our expectation that the
FWS-I and FWS-CS programs will continue to grow and our other
additional programs will finish development this year and go into
production; our expectations for our 10 military programs in
various stages of production or develop being able to contribute to
revenue in the future; our belief that there are numerous
applications for our unique OLED technology; our expectation that
we will have an increase in military revenues in 2020 as compared
to 2019 and that such increase will be partially offset by expected
lower demand from our industrial customers; our belief that our
current cash and marketable securities position is sufficient to
fund our operations in 2020; and our ability to regain compliance
with the Nasdaq’s listing standards and the possibility of
requesting an extension from the Nasdaq to delay our delisting.
Various factors, some of which are beyond our control, could cause
actual results to differ materially from those expressed in, or
implied by, such forward-looking statements. All such
forward-looking statements, whether written or oral, and whether
made by us or on our behalf, are expressly qualified by these
cautionary statements and any other cautionary statements that may
accompany the forward-looking statements. In addition, we disclaim
any obligation to update any forward-looking statements to reflect
events or circumstances after the date of this press release,
except as may otherwise be required by the federal securities laws.
These forward-looking statements are only predictions, subject to
risks and uncertainties, and actual results could differ materially
from those discussed. Important factors that could affect
performance and cause results to differ materially from
management's expectations are described in Part I, Item 1A. Risk
Factors; Part II, Item 7. Management’s Discussion and Analysis of
Financial Condition and Results of Operations; and other parts of
our Annual Report on Form 10-K for the fiscal year ended December
29, 2018, or as updated from time to time in the Company’s
Securities and Exchange Commission filings.
Kopin Corporation
Supplemental Information (Unaudited)
Three Months Ended Twelve Months Ended
December 28, 2019
December 29, 2018
December 28, 2019
December 29, 2018 Revenues
by Category (in millions) Military
$
3.5
$
3.3
$
8.7
$
8.7
Industrial
2.5
1.8
9.7
6.1
Consumer
0.3
0.9
1.8
4.1
Other
-
-
-
0.3
Research and Development
2.4
1.3
5.0
5.3
License and Royalties
-
0.4
4.3
-
Total
$
8.7
$
7.7
$
29.5
$
24.5
Stock-Based Compensation Expense
Cost of product revenues
$
20,000
$
100,000
$
103,000
$
419,000
Research and development
34,000
98,000
296,000
725,000
Selling, general and administrative
198,000
715,000
1,659,000
3,647,000
$
252,000
$
913,000
$
2,058,000
$
4,791,000
Other Financial Information
Depreciation and amortization
$
195,000
$
270,000
$
792,000
$
1,959,000
Kopin Corporation Condensed Consolidated Statements of
Operations (Unaudited)
Three Months Ended Twelve Months
Ended December 28,
2019 December 29,
2018 December 28,
2019 December 29,
2018 Revenues: Net product
revenues
$
6,279,568
$
6,050,608
$
20,283,888
$
19,211,115
Research and development and other revenues
2,446,850
1,690,549
9,234,921
5,253,890
8,726,418
7,741,157
29,518,809
24,465,005
Expenses: Cost of product revenues
5,092,003
4,611,700
20,901,538
15,831,441
Research and development
2,662,637
3,868,228
13,349,130
17,445,303
Selling, general and administrative
4,527,967
6,199,800
21,316,459
27,210,849
Impairment on assets and goodwill
-
3,944,135
331,344
3,944,139
12,282,607
18,623,863
55,898,471
64,431,732
Loss from operations
(3,556,189
)
(10,882,706
)
(26,379,662
)
(39,966,727
)
Other (expense) income, net
(3,725,732
)
1,071,973
(2,886,560
)
5,514,235
Loss before provision for income
taxes and net loss
(7,281,921
)
(9,810,733
)
(29,266,222
)
(34,452,492
)
(income) from noncontrolling interest
Provision for income taxes
(30,000
)
(145,000
)
(108,000
)
(30,000
)
Net loss
(7,311,921
)
(9,955,733
)
(29,374,222
)
(34,482,492
)
Net loss (income) attributable
to noncontrolling interest
22,448
(9,189
)
(132,030
)
(51,050
)
Net loss attributable to the
controlling interest
$
(7,289,473
)
$
(9,964,922
)
$
(29,506,252
)
$
(34,533,542
)
Net loss per share:
Basic and diluted
$
(0.09
)
$
(0.14
)
$
(0.37
)
$
(0.47
)
Weighted average number of
common shares outstanding: Basic and
diluted
82,155,473
73,316,656
80,282,126
73,156,545
Kopin Corporation
Condensed Consolidated Balance Sheets (Unaudited)
December 28, 2019 December 29,
2018 ASSETS Current assets: Cash and marketable
securities
$
21,782,244
$
37,244,363
Accounts receivable, net
6,023,250
3,088,360
Contract assets and unbilled receivables
921,082
3,089,663
Inventory
3,768,696
4,797,238
Prepaid and other current assets
1,269,369
1,184,401
Total current assets
33,764,641
49,404,025
Land, equipment and improvements, net
1,473,341
2,598,842
Operating lease right of use assets
2,753,963
-
Goodwill and intangible assets
-
331,344
Equity investment
4,537,159
5,853,525
Other assets
517,411
1,361,375
Total assets
$
43,046,515
$
59,549,111
LIABILITIES AND STOCKHOLDERS' EQUITY Current
liabilities: Accounts payable
$
3,998,234
$
3,921,878
Accrued expenses
4,947,990
5,510,553
Operating lease liabilities
1,041,695
-
Deferred income taxes
525,000
546,000
Contract liabilities and billings in excess of revenue earned
796,794
388,933
Total current liabilities
11,309,713
10,367,364
Other long term liabilities
1,353,600
1,468,925
Operating lease liabilities, net of current portion
1,791,590
-
Total Kopin Corporation stockholders' equity
28,608,635
47,861,915
Noncontrolling interest
(17,023
)
(149,093
)
Total stockholders' equity
28,591,612
47,712,822
Total liabilities and stockholders' equity
$
43,046,515
$
59,549,111
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200310005220/en/
Kopin Corporation Richard Sneider, 508-870-5959 Treasurer
and Chief Financial Officer Richard_Sneider@kopin.com or Market
Street Partners Joann Horne, 415-445-3233
JHorne@marketstreetpartners.com
Kopin (NASDAQ:KOPN)
Historical Stock Chart
From Apr 2024 to May 2024
Kopin (NASDAQ:KOPN)
Historical Stock Chart
From May 2023 to May 2024