Conference Call Scheduled for today,
May 15, 2023 at 5:00pm ET
GARDNER,
Mass., May 15, 2023 /PRNewswire/ -- Precision
Optics Corporation, Inc. (NASDAQ: POCI), a leading designer and
manufacturer of advanced optical instruments for the medical and
defense industries, announced operating results on an unaudited
basis for its third quarter fiscal year 2023.
Third quarter fiscal 2023 financial highlights:
- Revenue for the quarter ended March 31,
2023, increased 9% to $5.05
million, compared to $4.65
million in the same quarter of the previous fiscal
year.
- Production revenue reached a new quarterly record of
$3.7 million, an increase of 17%
compared to the same quarter of the previous fiscal year.
- Gross margin for the quarter ended March
31, 2023, was 34% compared to 37% in the same quarter of the
previous year.
- Net loss for the quarter was ($398,432) which compared to net loss of
($113,899) in the same quarter of the
previous year.
- Adjusted EBITDA, defined as earnings before interest, taxes,
depreciation, amortization, stock-based compensation and other
income, was $9,456 for the quarter
ended March 31, 2023, compared to
$236,201 in the same quarter of the
previous year.
Recent additional highlights:
- In January 2023, the Company
announced the receipt of a follow-on production order totaling
approximately $2.3 million from a
large medical device company for an otoscopy application to meet
enhanced demand for the product.
- In February 2023, the Company
announced its engagement into a production and technology license
agreement under which the Company expects to manufacture or be paid
royalties on a single-use ophthalmic product jointly developed by
the Company and its customer.
- In April 2023, the Company
announced the receipt of an initial product development order for a
next-generation urological endoscopy program totaling approximately
$1.3 million from an established
medical device company.
- In May 2023, the Company
announced the receipt of a follow-on product development order for
a next generation single-use urology program totaling approximately
$1.5 million from an established
medical device company leveraging the Company's unique expertise in
micro-optics, medical systems, and digital imaging.
- In April 2023, the Company
appointed Mahesh Lawande in the
newly created role of Chief Operating Officer to lead Precision
Optics operations team, including its sales & marketing,
production and engineering activities at its facilities in
Massachusetts, Maine and Texas.
Precision Optics' CEO, Joseph
Forkey, commented, "I am pleased with the continued progress
made during the quarter with revenue up 9% and positive adjusted
EBITDA as we advanced or ramped up production for a number of our
programs. Looking specifically at our production revenue, we were
up 17% compared to the same quarter a year ago, representing a new
all-time record for production revenue. Importantly, we have
recently received new and follow-on production orders for several
programs, including an otoscopy application and a defense /
aerospace program, which should enable continued strong production
levels into the future. We are also making great progress on
single-use medical devices as we look to address the key technical
and supply chain challenges that are critical to long-term success
in this market. This was validated by a recent $1.5 million follow-on development order for a
new single-use urology application we announced last week. As one
of the few competitive companies able to meet the unique challenges
of single-use, I believe we are in a great position to capitalize
on this rapidly growing market."
"We apply our deep technical knowledge to support a customer
from the early design phase all the way through mass production.
This model leverages our capabilities in micro-optics, 3D endoscopy
and digital imaging to bring new and innovative products to the
market. Because our development pipeline is the engine that
ultimately drives production revenue, we made the decision during
the third quarter to continue development on a few programs that
ran overbudget, and to share in the excess costs with our
customers. While this impacted revenue, margins, net income and
EBITDA during the current quarter, we believe the upside potential,
as demonstrated by our record production revenue, warrants making
these strategic investments."
The following table summarizes the third quarter (unaudited)
results for the periods ended March 31,
2023 and 2022: Note: the Common Share figures in this table
reflect post reverse split figures.
|
|
Three Months
|
|
Nine Months
|
|
|
Ended March
31,
|
|
Ended March
31,
|
|
|
2023
|
2022
|
|
2023
|
2022
|
Revenues
|
$5,048,065
|
$4,651,352
|
$16,020,327
|
$10,884,737
|
|
|
|
|
|
|
|
Gross Profit
|
1,736,098
|
1,728,209
|
|
5,975,011
|
3,486,823
|
|
|
|
|
|
|
|
Stock Compensation
Expenses
|
450,014
|
231,115
|
|
769,790
|
741,637
|
Business Acquisition
Expenses
|
|
-
|
|
|
172,174
|
Other
|
1,779,352
|
1,558,215
|
|
5,229,226
|
3,666,435
|
Total Operating
Expenses
|
2,229,366
|
1,789,330
|
|
5,999,016
|
4,580,246
|
|
|
|
|
|
|
|
Operating Income
(Loss)
|
(493,268)
|
(61,121)
|
|
(24,005)
|
(1,093,423)
|
|
|
|
|
|
|
|
Net Income
(Loss)
|
(398,432)
|
(113,899)
|
|
(48,488)
|
(1,197,713)
|
|
|
|
|
|
|
|
Income (Loss) per
Share
|
|
|
|
|
|
|
Basic and Fully
Diluted
|
$(0.07)
|
(0.02)
|
|
$(0.01)
|
$(0.23)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Common
Shares Outstanding
|
|
|
|
|
|
|
Basic and Fully
Diluted
|
5,640,473
|
5,600,953
|
|
5,693,015
|
5,181,896
|
Conference Call Details
Date and Time:
Monday May 15, 2023, at 5:00pm ET
Call-in Information: Interested parties can access the
conference call by dialing (844) 735-3662 or
(412) 317-5705.
Live Webcast Information: Interested parties can access
the conference call via a live webcast, which is available
at https://app.webinar.net/YErAze3qoXK.
Replay: A teleconference replay of the call will be
available until May 22, 2023 at (877)
344-7529 or (412) 317-0088, replay access code 5704358. A webcast
replay will be available
at https://app.webinar.net/YErAze3qoXK.
About Precision Optics Corporation
Founded in 1982,
Precision Optics is a vertically integrated optics company
primarily focused on leveraging its proprietary micro-optics and 3D
imaging technologies to the healthcare and defense/aerospace
industries by providing services ranging from new product concept
through mass manufacture. Utilizing its leading-edge in-house
design, prototype, regulatory and fabrication capabilities as well
as its Lighthouse Imaging division's electronic imaging expertise
and its Ross Optical division's high volume world-wide sourcing,
inspecting and production resources, the Company is able to design
and manufacture next-generation product solutions to the most
challenging customer requirements. Within healthcare, Precision
Optics enables next generation medical device companies around the
world to meet the increasing demands of the surgical community who
require more enhanced and smaller imaging systems for minimally
invasive surgery as well as 3D endoscopy systems to support the
rapid proliferation of surgical robotic systems. In addition to
these next generation applications, Precision Optics has supplied
top tier medical device companies a wide variety of optical
products for decades, including complex endocouplers and
specialized endoscopes. The Company is also leveraging its
technical proficiency in micro-optics to enable leading edge
defense/aerospace applications which require the highest quality
standards and the optimization of size, weight and power. For more
information, please visit www.poci.com.
Non-GAAP Financial Measures
Precision Optics has provided in this press release financial
information that has not been prepared in accordance with
accounting principles generally accepted in the Unites States of
America ("non-GAAP"). The non-GAAP financial measure is adjusted
EBITDA (earnings before interest, taxes, depreciation and
amortization). Adjusted EBITDA also excludes from Net income from
continuing operations the effect of Stock-based compensation,
Restructuring and other acquisition related expenses.
This non-GAAP financial measure assists Precision Optics
management in comparing its operating performance over time because
certain items may obscure the underlying business trends and make
comparisons of long-term performance difficult, as they are of a
nature and/or size that occur with inconsistent frequency or relate
to discrete acquisition or restructuring plans that are
fundamentally different from the ongoing productivity of the
Company. Precision Optics management also believes that presenting
this measure allows investors to view its performance using the
same measures that the Company uses in evaluating its financial and
business performance and trends.
Non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, financial information
calculated in accordance with GAAP. Investors are encouraged to
review the reconciliation of non-GAAP measures to their most
directly comparable GAAP financial measures. A reconciliation of
the non-GAAP financial measure presented above to GAAP results has
been provided in the financial tables included with this press
release.
About Forward-Looking Statements
This press release
contains forward-looking statements. Forward-looking statements
include, but are not limited to, statements that express the
Company's intentions, beliefs, expectations, strategies,
predictions or any other statements related to the Company's future
activities or future events or conditions. These statements are
based on current expectations, estimates and projections about the
Company's business based, in part, on assumptions made by the
Company's management. These statements are not guarantees of future
performances and involve risks, uncertainties and assumptions that
are difficult to predict. Therefore, actual outcomes and results
may differ materially from what is expressed or forecasted in the
forward-looking statements due to numerous factors, including those
risks discussed in the Company's annual report on Form 10-K and in
other documents that we file from time to time with the SEC. Any
forward-looking statements speak only as of the date on which they
are made, and the Company does not undertake any obligation to
update any forward-looking statement, except as required by
law.
Company Contact:
PRECISION OPTICS
CORPORATION
22 East Broadway
Gardner, Massachusetts
01440-3338
Telephone: 978-630-1800
Investor Contact:
LYTHAM PARTNERS, LLC
Robert Blum
Phoenix | New York
Telephone: 602-889-9700
poci@lythampartners.com
Following are the Company's Consolidated Balance Sheets at
March 31, 2023 and June 30, 2022, and Statements of Operations, for
the three and nine months ended March 31,
2023 and 2022:
PRECISION OPTICS
CORPORATION, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE
SHEETS
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
|
June
30,
|
|
|
2023
|
|
|
2022
|
ASSETS
|
|
|
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
612,095
|
|
|
$
|
605,749
|
Accounts receivable,
net of allowance for doubtful accounts of $74,593 at
March 31, 2023
and $44,135 at June 30, 2022
|
|
|
4,389,907
|
|
|
|
2,663,872
|
Inventories
|
|
|
2,959,732
|
|
|
|
3,079,938
|
Prepaid
expenses
|
|
|
307,663
|
|
|
|
213,448
|
Total current
assets
|
|
|
8,269,397
|
|
|
|
6,563,007
|
|
|
|
|
|
|
|
|
Fixed
Assets:
|
|
|
|
|
|
|
|
Machinery and
equipment
|
|
|
3,225,483
|
|
|
|
3,215,412
|
Leasehold
improvements
|
|
|
794,894
|
|
|
|
786,112
|
Furniture and
fixtures
|
|
|
233,547
|
|
|
|
219,999
|
Total fixed
assets
|
|
|
4,253,924
|
|
|
|
4,221,523
|
Less—Accumulated
depreciation and amortization
|
|
|
3,809,303
|
|
|
|
3,651,843
|
Net fixed
assets
|
|
|
444,621
|
|
|
|
569,680
|
|
|
|
|
|
|
|
|
Operating lease
right-to-use asset
|
|
|
399,007
|
|
|
|
517,725
|
Patents, net
|
|
|
249,408
|
|
|
|
229,398
|
Goodwill
|
|
|
8,824,210
|
|
|
|
8,824,210
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$
|
18,186,643
|
|
|
$
|
16,704,020
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
|
|
|
Current portion of
financing lease obligation
|
|
$
|
42,397
|
|
|
$
|
40,705
|
Current maturities of
long-term debt
|
|
|
371,429
|
|
|
|
367,714
|
Current portion of
acquisition earn out liabilities
|
|
|
571,838
|
|
|
|
166,667
|
Accounts
payable
|
|
|
2,649,248
|
|
|
|
2,239,175
|
Contract
liabilities
|
|
|
1,387,806
|
|
|
|
905,113
|
Accrued compensation
and other
|
|
|
1,305,678
|
|
|
|
716,702
|
Operating lease
liability
|
|
|
166,316
|
|
|
|
150,565
|
Total current
liabilities
|
|
|
6,494,712
|
|
|
|
4,586,641
|
|
|
|
|
|
|
|
|
Financing lease
obligation, net of current portion
|
|
|
79,701
|
|
|
|
111,691
|
Long-term debt, net of
current maturities and debt issuance costs
|
|
|
1,681,642
|
|
|
|
1,961,141
|
Acquisition earn out
liability, net of current portion
|
|
|
–
|
|
|
|
705,892
|
Operating lease
liability, net of current portion
|
|
|
232,691
|
|
|
|
367,160
|
|
|
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
|
|
|
|
Common stock, $0.01 par
value: 50,000,000 shares authorized; issued and
outstanding –
5,640,995 shares at March 31, 2023 and 5,638,302 June 30,
2022
|
|
|
56,410
|
|
|
|
56,383
|
Additional paid-in
capital
|
|
|
57,784,369
|
|
|
|
57,009,506
|
Accumulated
deficit
|
|
|
(48,142,882)
|
|
|
|
(48,094,394)
|
Total stockholders'
equity
|
|
|
9,697,897
|
|
|
|
8,971,495
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
$
|
18,186,643
|
|
|
$
|
16,704,020
|
PRECISION OPTICS
CORPORATION, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS
FOR THE THREE AND
NINE MONTHS ENDED
March 31, 2023 AND
2022
(UNAUDITED)
|
|
|
|
Three Months
Ended March 31,
|
|
|
Nine Months
Ended March 31,
|
|
|
2023
|
|
|
2022
|
|
|
2023
|
|
|
2022
|
Revenues
|
|
$
|
5,048,065
|
|
|
$
|
4,651,352
|
|
|
$
|
16,020,327
|
|
|
$
|
10,884,737
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
|
3,311,967
|
|
|
|
2,923,143
|
|
|
|
10,045,316
|
|
|
|
7,397,914
|
Gross profit
|
|
|
1,736,098
|
|
|
|
1,728,209
|
|
|
|
5,975,011
|
|
|
|
3,486,823
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development expenses, net
|
|
|
206,375
|
|
|
|
214,898
|
|
|
|
660,518
|
|
|
|
433,248
|
Selling, general and
administrative expenses
|
|
|
2,022,991
|
|
|
|
1,574,432
|
|
|
|
5,338,498
|
|
|
|
3,974,824
|
Business acquisition
expenses
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
172,174
|
Total operating
expenses
|
|
|
2,229,366
|
|
|
|
1,789,330
|
|
|
|
5,999,016
|
|
|
|
4,580,246
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
|
(493,268)
|
|
|
|
(61,121)
|
|
|
|
(24,005)
|
|
|
|
(1,093,423)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
(48,124)
|
|
|
|
(52,778)
|
|
|
|
(167,443)
|
|
|
|
(104,290)
|
Gain on
revaluation of contingent earn-out liability
|
|
|
142,960
|
|
|
|
–
|
|
|
|
142,960
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
(398,432)
|
|
|
$
|
(113,899)
|
|
|
$
|
(48,488)
|
|
|
$
|
(1,197,713)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and fully
diluted
|
|
$
|
(0.07)
|
|
|
$
|
(0.02)
|
|
|
$
|
(0.01)
|
|
|
$
|
(0.23)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and fully
diluted
|
|
|
5,640,473
|
|
|
|
5,600,953
|
|
|
|
5,639,015
|
|
|
|
5,181,896
|
|
Note: The Common
Shares in this table reflect shares on a post reverse split basis
for all periods presented.
|
PRECISION OPTICS
CORPORATION, INC. AND SUBSIDIARIES
RECONCILIATION OF
GAAP TO NON-GAP FINANCIAL MEASURES
ADJUSTED
EBITDA
|
|
|
|
Three Months
Ended March 31,
|
|
|
Nine Months
Ended March 31,
|
|
|
2023
|
|
|
2022
|
|
|
2023
|
|
|
2022
|
Net loss
(GAAP)
|
|
$
|
(398,432)
|
|
|
$
|
(113,899)
|
|
|
$
|
(48,488)
|
|
|
$
|
(1,197,713)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock based
compensation
|
|
|
450,014
|
|
|
|
231,115
|
|
|
|
769,790
|
|
|
|
741,637
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
52,710
|
|
|
|
66,207
|
|
|
|
157,460
|
|
|
|
173,887
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
48,124
|
|
|
|
52,778
|
|
|
|
167,443
|
|
|
|
104,290
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition
Expense
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
172,174
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revaluation of earn-out
liability
|
|
|
(142,960)
|
|
|
|
–
|
|
|
|
(142,960)
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(non-GAAP)
|
|
$
|
9,456
|
|
|
$
|
236,201
|
|
|
$
|
903,245
|
|
|
$
|
(5,725)
|
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multimedia:https://www.prnewswire.com/news-releases/precision-optics-reports-third-quarter-fiscal-year-2023-financial-results-301825080.html
SOURCE Precision Optics Corporation