Fourth quarter revenues of $8.6 million and
2023 revenues of $40.4 million
Fifth consecutive quarter of positive
book-to-bill
Expects double digit revenue growth in 2024
Kopin Corporation (Nasdaq: KOPN), a leading provider of
application-specific optical solutions for defense, enterprise,
industrial, and consumer products, today reported financial results
for the fourth quarter and full fiscal year ended December 30,
2023.
Company Highlights
- Fifth consecutive quarter of positive book-to-bill with greater
than $55 million of orders for 2024 as of January 2024
- Paused production in Westborough manufacturing facility in the
fourth quarter of 2023 for additional automation and retooling in
anticipation of greater 2024 demand, impacting fourth quarter 2023
revenue
- New branding and website unveiled in January 2024
- Expect 2024 revenue growth of at least 20% compared to
2023
- Continued OLED fabrication transition to U.S. DoD approved
facilities
- Announced Software Defined, AI enabled NeuralDisplay™
Architecture
“2023 was a transitional year for Kopin, successfully evolving
from a leading provider of microdisplay solutions to becoming an
application-specific optical solutions provider,” said Michael
Murray, Kopin's Chief Executive Officer. “This shift was
underscored in the fourth quarter and into 2024 with additional
partnerships and multiple new and follow-on orders, supported by
strong new and existing customer engagement and satisfaction.
Performance and outlook were supported by our fifth consecutive
quarter of positive book to bill, marking a new record for
orders.
“We saw continued positive momentum with follow-on orders in the
fourth quarter, including a $6.0 million follow-on order for a
Thermal Weapon Sight Program. This follow-on order is a testament
to our responsiveness and reliability in delivering weapon sights
and targeting products in this fast-changing global environment,
and the improvements in our manufacturing processes and equipment.
Combined with a $20.5 million contract for new thermal weapon sight
configuration and several other orders in the first quarter of
2024, the increase in demand would potentially triple our thermal
weapon sight production volumes in fiscal year 2024, as compared to
2023.
“As a result of our strong order book, we plan for a significant
production increase in 2024. As we discussed in our third quarter
of 2023 financial results call, to ensure we execute on this
anticipated production ramp in 2024, we took additional steps and
extended our planned 2023 holiday shut down period to improve
production flow for long-term profitability. These preparations
included a temporary pause in production to retool, adding new
automation, and clean our manufacturing facilities at the end of
the fourth quarter, which had an impact on the quarter’s
revenues.
Mr. Murray concluded: "We start 2024 with a strong order book,
new customer engagements and positive internal morale,
strengthening Kopin for significant and sustainable revenue growth
needed to achieve profitability. We have increased our 2024 order
cover with higher prices on several key programs and believe there
are opportunities for additional follow-on orders and several new
customer development orders which we expect to receive soon. Our
sales funnel is strong and our increased emphasis and resources
focused on business development are paying off. As we look forward,
our foundation of innovation paired with our core capabilities
serve as the bedrock for our progression into application-specific
optical solutions and advanced software-defined AI-enabled
microdisplays. We believe Kopin is well positioned to deliver these
exciting new technologies and deliver long-term growth for our
shareholders.”
Fourth Quarter Financial Results
Total revenues for the fourth quarter ended December 30, 2023,
were $8.6 million, compared to $12.2 million for the fourth quarter
ended December 31, 2022. Product revenues for the fourth quarter
ended December 30, 2023, were $6.8 million, compared to $8.7
million for the fourth quarter ended December 31, 2022. The
decrease in product revenues was a result of lower defense and
industrial product revenues, which decreased by $0.9 million and
$0.6 million, respectively, year over year. In the fourth quarter
of 2023, funded research and development revenues decreased by $1.6
million due to the completion of certain programs.
Cost of Product Revenues for the fourth quarter of 2023 was $7.2
million, or 106% of net product revenues, compared with $8.9
million, or 103% of net product revenues, for the fourth quarter of
2022.
R&D expenses for the fourth quarter of 2023 were $2.2
million compared to $4.7 million for the fourth quarter of 2022.
The decrease in R&D expense is attributable to a decrease in
funded research and development expense as certain programs were
completed and lower internal expense related to OLED
development.
SG&A expenses were $5.9 million for the fourth quarter of
2023, compared to $4.9 million for the fourth quarter of 2022. The
increase was primarily due to legal fees associated with our
litigation.
Net Loss Attributable to Kopin for the fourth quarter of 2023
was ($6.5) million, or ($0.06) per share, compared with Net Loss
Attributable to Kopin of ($6.2) million, or ($0.07) per share, for
the fourth quarter of 2022.
Full Year 2023 Financial Results
Total revenues for the year ended December 30, 2023, were $40.4
million, compared to $47.4 million for the year ended December 31,
2022. Product revenues for the year ended December 30, 2023, were
$25.9 million, compared to $32.4 million for the year ended
December 31, 2022. The decrease in product revenues was a result of
lower defense, industrial and consumer product revenues, which
decreased by $2.2 million, $3.4 million, and $0.9 million,
respectively, year over year. Revenues from the sale of products
for defense declined due to lower revenues from thermal weapon
sight applications which were partially offset by higher revenues
from avionic applications. Revenues from industrial applications
declined to lower revenues for products for 3D automated optical
inspection (3DAOI) due to continued weakness in the Chinese 3D
automated test market and lower revenues from industrial headset
applications. Consumer revenues declined in 2023 as compared to
2022 due to lower sales of OLED displays for consumer applications.
In the full year 2023, funded research and development revenues
decreased by $0.9 million due to decreased funding for new display
technology development for U.S. defense programs and OLED display
development, which was partially offset by increased funding for
armor vehicle targeting system and medical headset development.
Cost of Product Revenues for 2023 was $25.0 million, or 96% of
net product revenues, compared with $32.6 million, or 100% of net
product revenues in the prior year. Cost of product revenues
decreased as a percentage of revenues in 2023 as compared to 2022
primarily due to increased sales of higher margin products for
defense applications in 2023 versus 2022 and decreased sales of
lower margin products for defense applications in 2023 versus 2022.
The Company also implemented several programs and hired additional
employees to improve manufacturing quality and efficiency.
R&D expenses for 2023 were $10.8 million compared to $18.7
million for 2022, a 42% decrease year over year. The decrease in
R&D expense as compared to the prior year was seen in both
funded and internal R&D. Funded R&D expenses were $7.2
million for 2023 as compared to $10.3 million for 2022, a 30%
decrease, primarily due to the completion of contracts for defense
programs awarded prior to 2023. Internal R&D expenses were $3.6
million for 2023 as compared to $8.4 million for 2022, a 57%
decrease, primarily due to decreased OLED development.
Selling, General and Administration (SG&A) expenses were
$21.8 million for 2023, compared to $18.0 million for 2022.
SG&A for 2023 increased as compared to 2022 primarily due to an
increase of approximately $5.0 million in legal and professional
fees and $1.0 million in non-cash stock-based compensation,
partially offset by a $1.3 million decrease in compensation and
benefits.
Net Loss Attributable to Kopin Corporation for the year 2023 was
$19.7 million, or $0.18 per share, compared with Net Loss
Attributable to Kopin Corporation of $19.3 million, or $0.21 per
share, for the year 2022.
Net Cash Used in Operating Activities for 2023 was approximately
$15.3 million. Kopin’s cash and equivalents and marketable
securities were approximately $17.9 million at December 30, 2023 as
compared to $12.6 million at December 31, 2022. In the first
quarter of 2024 the Company sold 3.1 million shares of its common
stock for gross proceeds of $7.5 million under its At The Market
(ATM) program.
All amounts above are estimates and readers should refer to the
Form 10-K for the fiscal year ended December 30, 2023, for final
disposition as well as important risk factors.
Earnings Call and Webcast
Kopin management will host the conference call, followed by a
question and answer session.
Date: Thursday, March 14, 2024 Time: 4:30 PM Eastern Time (1:30
PM Pacific Time) U.S. dial-in number: 800-274-8461 International
number: 203-518-9843 Webcast: 4Q23 Webcast Link
The Company will also provide a link at
https://www.kopin.com/investors/ for those who wish to stream the
call via webcast. Please call the conference telephone number 5-10
minutes prior to the start time.
A telephonic replay of the conference call will also be
available through March 21, 2024.
Toll-free replay number: 844-512-2921 International replay
number: 412-317-6671 Replay passcode: 1155187
About Kopin
Kopin Corporation is a leading developer and provider of
innovative display and optical technologies sold as critical
components and subassemblies for defense, industrial and consumer
products. Kopin’s technology portfolio includes ultra-small
Active-Matrix Liquid Crystal displays (AMLCD), Liquid Crystal on
Silicon (LCOS) displays and Organic Light Emitting Diode (OLED)
displays, a variety of optics, and low-power ASICs. For more
information, please visit Kopin’s website at www.kopin.com. Kopin
is a trademark of Kopin Corporation.
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 projected increase in demand
for our thermal weapons displays; and our belief that there are
opportunities for additional follow-on orders and several new
customer development orders which we expect to receive soon.
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, including without
limitation our ability to produce thermal weapons displays in
adequate quantities to meet projected demand, the outcome of any
litigation and other factors beyond our control. 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
30, 2023, or as updated from time to time our Securities and
Exchange Commission filings.
Kopin Corporation Condensed Consolidated Balance
Sheets (Unaudited) December 30, 2023
December 31, 2022 ASSETS Current assets: Cash, restricted
cash and marketable securities
$
17,902,685
$
12,647,656
Accounts receivable, net
9,706,036
6,537,891
Inventory
7,601,806
6,426,400
Contract assets and unbilled receivables
3,409,809
4,068,364
Prepaid and other current assets
1,210,207
1,180,362
Total current assets
39,830,543
30,860,673
Plant and equipment, net
2,163,417
1,831,641
Operating lease right-of-use assets
2,504,909
3,168,520
Equity investments
4,688,522
7,721,206
Other assets
124,925
170,132
Total assets
$
49,312,316
$
43,752,172
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities:
Accounts payable
$
7,076,759
$
5,438,980
Accrued expenses
5,564,187
6,027,485
Accrued Compensation
790,000
790,000
Customer deposits
408,156
-
Deferred tax liabilities
470,884
482,739
Contract liabilities and billings in excess of revenue earned
916,826
930,500
Operating lease liabilities
651,503
786,928
Total current liabilities
15,878,315
14,456,632
Other long term liabilities
2,092,124
2,728,042
Operating lease liabilities, net of current portion
1,832,982
2,576,883
Total Kopin Corporation stockholders' equity
29,508,895
24,163,297
Noncontrolling interest
-
(172,682
)
Total stockholders' equity
29,508,895
23,990,615
Total liabilities and stockholders' equity
$
49,312,316
$
43,752,172
Kopin Corporation Condensed Consolidated Statements of
Operations (Unaudited) Three Months Ended
Twelve Months Ended December 30,
2023 December 31,
2022 December 30,
2023 December 31,
2022 Revenues: Net product revenues
$
6,764,868
$
8,654,525
$
25,937,170
$
32,420,397
Research and development revenues
1,717,804
3,268,207
13,454,866
14,357,222
Other revenues
94,961
261,625
1,002,141
623,571
8,577,633
12,184,357
40,394,177
47,401,190
Expenses: Cost of product revenues
7,193,314
8,882,465
24,952,431
32,558,748
Research and development
2,242,682
4,672,165
10,777,093
18,667,558
Selling, general and administration
5,929,309
4,852,964
21,842,157
17,965,097
15,365,305
18,407,594
57,571,681
69,191,403
Loss from operations
(6,787,672
)
(6,223,237
)
(17,177,504
)
(21,790,213
)
Other income, net
337,700
101,999
(2,414,715
)
2,607,948
Loss before provision for income taxes and net loss (income)
(6,449,972
)
(6,121,238
)
(19,592,219
)
(19,182,265
)
attributable to noncontrolling interest Tax provision
(39,000
)
(36,000
)
(156,000
)
(144,000
)
Net loss
(6,488,972
)
(6,157,238
)
(19,748,219
)
(19,326,265
)
Net loss attributable to noncontrolling interest
-
68
-
348
Net loss attributable to Kopin Corporation
$
(6,488,972
)
$
(6,157,170
)
$
(19,748,219
)
$
(19,325,917
)
Net loss per share: Basic
$
(0.06
)
$
(0.07
)
$
(0.18
)
$
(0.21
)
Diluted
$
(0.06
)
$
(0.07
)
$
(0.18
)
$
(0.21
)
Weighted average number of common shares outstanding: Basic
110,596,543
91,739,459
108,976,245
91,429,106
Diluted
110,596,543
91,739,459
108,976,245
91,429,106
Kopin Corporation Supplemental Information
(Unaudited) Three Months Ended Twelve
Months Ended December 30,
2023 December 31,
2022 December 30,
2023 December 31,
2022 Display Revenues by Category (in millions)
Defense
$
6.1
$
7.1
$
22.6
$
24.8
Industrial/Enterprise
0.6
1.2
2.7
6.1
Consumer
0.1
0.3
0.6
1.5
R&D
1.7
3.3
13.5
14.4
License and Royalties
0.1
0.3
1.0
0.6
Total
$
8.6
$
12.2
$
40.4
$
47.4
Stock-Based Compensation Expense Cost of
product revenues
$
445,000
$
(25,000
)
$
1,210,000
$
95,000
Research and development
308,000
68,000
861,000
436,000
Selling, general and administrative
778,000
(146,000
)
1,804,000
737,000
$
1,531,000
$
(103,000
)
$
3,875,000
$
1,268,000
Other Financial Information Depreciation and
amortization
$
110,000
$
57,000
$
608,000
$
722,000
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240314463490/en/
Kopin Corporation Richard Sneider Treasurer and Chief Financial
Officer rsneider@kopin.com
MZ Contact Brian M. Prenoveau, CFA MZ Group – MZ North
America KOPN@mzgroup.us +561 489 5315
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