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Advanced Photonix, Inc. Reports Third Quarter Fiscal 2010 Results
Gross profit margins resist downward pressure despite recession's revenue drop
ANN ARBOR, Mich., Feb. 8 /PRNewswire-FirstCall/ -- Advanced Photonix, Inc.® (NYSE Amex: API) (the "Company") today reported its third quarter fiscal 2010 results ending December 25, 2009.
Financial Highlights for the Third Quarter Ended December 25, 2009
- Net sales for the quarter were $4.6 million, a decrease of $3 million, or 40%, compared to revenues for the third quarter ended December 26, 2008. The decrease was broad based across four of its five markets.
- Gross profit margin for the first nine months was 42% compared to 45% for the prior year nine month period, despite a 32% drop in revenue when compared to the record revenues in the first nine months of last year. Strong gross margins reflect the results of company-wide cost reduction initiatives and prior years' facilities consolidation activities.
- GAAP net loss for the quarter was $1,344,000, or $.05 per diluted share, as compared to a GAAP net loss of $359,000, or $.01 per diluted share for the quarter ended December 26, 2008. GAAP net loss year to date was $2,832,000 or $.12 per diluted share, as compared to a net loss of $538,000, or $.02 per diluted share, for the prior year period.
- The Non-GAAP net loss for the third quarter of fiscal 2010 was $921,000, or $0.04 per diluted share, as compared to a Non-GAAP net income of $261,000, or $.01 per diluted share, for the comparable quarter ended December 26, 2008. The Company reported year to date Non-GAAP net loss of $1,058,000, or $0.04 per diluted share, as compared to a Non-GAAP income of $1,434,000, or $0.06 per diluted share, for the comparable prior year period.
- On an EBITDA basis (which is defined as GAAP earnings before interest, taxes, depreciation, and amortization), the Company reported EBITDA of a negative $646,000 for the third quarter of fiscal 2010 as compared to positive EBITDA of $591,000 for the quarter ended December 26, 2008. For the year to date, the Company reported negative EBITDA of $312,000 as compared to positive EBITDA of $2,183,000 for the comparable prior year period.
Richard Kurtz, Chairman and Chief Executive Officer, commented, "The first nine months of the year have been negatively impacted by the recessionary environment and this quarter was hit exceptionally hard. Our proactive actions in making the necessary cost reduction steps and consolidating our facilities have paid off and helped minimize the financial impact. We continue to expect the balance of the year to be challenging, but believe we have hit the bottom of the revenue decline and expect to slowly return to growth driven mainly by our HSOR and Terahertz product platforms. We do not anticipate top line revenue to meet our 2009 guidance, predominantly due to the continued softness in capital expenditures resulting from the recession. Our new Terahertz contract for the F-35 announced last month will strengthen our application product development in the aerospace and industrial markets and we will continue to develop the next generation 100G HSOR products that will be shipping in the coming quarters. While the recession's impact on our revenues has been severe this year, we expect to resume our organic growth in FY2011 when capital expenditures begin to return to normal levels."
The Company will hold a conference call to discuss the results for the third quarter ended December 25, 2009 on Monday, February 8, 2010 at 4:30 PM EST. Participants can dial into the conference call at 888-713-4218 (617-213-4870 for international) using the pass code 25674092. The call will be webcast live by CCBN and can be accessed at Advanced Photonix's web site at http://investor.advancedphotonix.com/ or at www.earnings.com. An audio replay of the call will be available shortly thereafter the same day and will remain on-line for two weeks. The replay number is 888-286-8010 (617-801-6888 for international) using pass code 24885602.
Forward-looking Statements:
The information contained herein includes forward looking statements that are based on assumptions that management believes to be reasonable but are subject to inherent uncertainties and risks including, but not limited to, risks associated with the move of our wafer fabrication facilities, technological obsolescence of existing product lines and technological obstacles which may prevent or slow the development and/or manufacture of new products, limited (or slower than anticipated) customer acceptance of new products which have been and are being developed by the Company and a decline in the general demand for optoelectronic products.
CONSOLIDATED BALANCE SHEETS
December 25, March 31,
Assets 2009 2009
Current Assets
Cash and cash equivalents $2,007,000 $2,072,000
Restricted cash 500,000 500,000
Accounts receivable, net 2,505,000 3,284,000
Inventories, net 3,681,000 3,669,000
Prepaid expenses and
other current assets 338,000 252,000
------- -------
Total current assets 9,031,000 9,777,000
Equipment & Leasehold
Improvements, at cost 11,241,000 11,470,000
Accumulated depreciation (7,673,000) (7,148,000)
---------- ----------
Net Equipment and Leasehold
Improvements 3,568,000 4,322,000
Goodwill 4,579,000 4,579,000
Patents, net 861,000 705,000
Intangible assets, net 6,744,000 8,270,000
Other assets 110,000 388,000
----------- -----------
Total assets $24,893,000 $28,041,000
=========== ===========
Liabilities and shareholders' equity
Current liabilities
Accounts payable and accrued expenses $2,394,000 $2,484,000
Compensation and related withholdings 940,000 1,037,000
Current portion of long-term debt -
line of credit 1,394,000 -
Current portion of long-term debt -
related parties 450,000 1,401,000
Current portion of long-term debt -
bank term loan 1,229,000 434,000
Current portion of long-term debt -
MEDC 1,014,000 353,000
--------- -------
Total current liabilities 7,421,000 5,709,000
Long term debt, less current portion -
MEDC 1,210,000 1,871,000
Long term debt, less current portion -
bank line of credit - 1,394,000
Long term fair value of warrant liability 172,000 -
Long term debt, less current portion-
related parties 951,000 1,121,000
------- ---------
Total liabilities 9,754,000 10,095,000
Shareholders' equity
Class A common stock, $.001 par value,
50,000,000 shares authorized; December
25, 2009 -24,463,978 shares issued and
outstanding; March 31, 2009 -24,089,726
shares issued and outstanding 24,000 24,000
Additional paid-in capital 50,100,000 52,400,000
Accumulated deficit (34,985,000) (34,478,000)
----------- -----------
Total shareholders' equity 15,139,000 17,946,000
----------- -----------
Total liabilities and
shareholders' equity $24,893,000 $28,041,000
=========== ===========
CONSOLIDATE STATEMENT OF OPERATIONS (unaudited)
Three months ended Nine months ended
------------------ -----------------
December 25, December 26, December 25, December 26,
2009 2008 2009 2008
Net Sales $4,588,000 $7,606,000 $15,947,000 $23,565,000
Cost of Sales 3,009,000 4,329,000 9,306,000 12,967,000
--------- --------- --------- ----------
Gross Margin 1,579,000 3,277,000 6,641,000 10,598,000
Other Operating
Expenses
Research &
Development 1,183,000 1,112,000 3,413,000 3,321,000
General &
Administrative 998,000 1,236,000 3,152,000 3,751,000
Amortization 518,000 516,000 1,552,000 1,561,000
Wafer Fab
Consolidation - 58,000 40,000 266,000
Sales & Marketing 380,000 605,000 1,249,000 1,935,000
------- ------- --------- ---------
Total Other
Operating
Expenses 3,079,000 3,527,000 9,406,000 10,834,000
Net Operating Income
(Loss) (1,500,000) (250,000) (2,765,000) (236,000)
Other (Income) & Expense
Other (Income)/Expense (62,000) - (54,000) 2,000
Interest Income (1,000) 3,000 (4,000) (25,000)
Interest Expense-
Related Parties 15,000 22,000 44,000 77,000
Change in fair value
of warrant liability (174,000) - (121,000) -
Interest Expense 66,000 84,000 202,000 248,000
------ ------ ------- -------
Other (Income)
& Expense (156,000) 109,000 67,000 302,000
Net Income (Loss) $(1,344,000) $(359,000) $(2,832,000) $(538,000)
Basic and diluted
earnings per share $(0.05) $(0.01) $(0.12) $(0.02)
Weighted number of
shares outstanding
-Basic and diluted 24,483,000 24,109,000 24,323,000 24,057,000
Non-GAAP Financial Measures
The Company provides Non-GAAP Net Income and EBITDA as supplemental financial information regarding the Company's operational performance. These Non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles in the United States. Non-GAAP Net Income and EBITDA should not be considered in isolation from or as a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from similar measures used by other companies. Reconciliation of Non-GAAP Net Income and EBITDA to GAAP net income and loss are set forth in the financial schedule section below.
Reconciliation of Non-GAAP Income (loss) to GAAP Income (loss)
Three months ended Nine months ended
------------------ -----------------
December 25, December 26, December 25, December 26,
2009 2008 2009 2008
Net Income (Loss) $(1,344,000) $(359,000) $(2,832,000) $(538,000)
Add Back:
Change in warrant
fair value (174,000) - (121,000) -
Amortization -
intangibles/
patents 519,000 517,000 1,552,000 1,561,000
Stock Option
Compensation
Expense 78,000 45,000 303,000 145,000
Other Expense -
Wafer
Fabrication - 58,000 40,000 266,000
--- ------ ------ -------
Subtotal -
Add backs 423,000 620,000 1,774,000 1,972,000
------- ------- --------- ---------
Non-GAAP Income
(Loss) $(921,000) $261,000 $(1,058,000) $1,434,000
========= ======== =========== ==========
Net earnings loss per
share $(0.04) $0.01 $(0.04) $0.06
Weighted Number of
shares
outstanding 24,483,000 24,109,000 24,323,000 24,057,000
Reconciliation of EBITDA to GAAP income/(loss)
Three months ended Nine months ended
------------------ -----------------
December 25, December 26, December 25, December 26,
2009 2008 2009 2008
Net Income (Loss) $(1,344,000) $(359,000) $(2,832,000) $(538,000)
Add Back:
Net Interest
expense
(income) 80,000 109,000 242,000 300,000
Interest expense -
Warrant (fair
value) (174,000) - (121,000) -
Depreciation
Expense 273,000 324,000 847,000 860,000
Amortization 519,000 517,000 1,552,000 1,561,000
------- ------- --------- ---------
Subtotal -
Add backs 698,000 950,000 2,520,000 2,721,000
------- ------- --------- ---------
EBITDA $(646,000) $591,000 $(312,000) $2,183,000
========= ======== ========= ==========
About Advanced Photonix, Inc.
Advanced Photonix, Inc. (R) (NYSE Amex: API) is a leading supplier with a broad offering of optoelectronic products to a global customer base. We provide optoelectronic solutions, high-speed optical receivers and terahertz instrumentation for telecom, homeland security, military, medical and industrial markets. With our patented technology and state-of-the-art manufacturing we offer industry leading performance, exceptional quality, and high value added products to our OEM customer base. For more information visit us on the web at www.advancedphotonix.com.
Contact: | |
Richard Kurtz, Advanced Photonix, Inc. (734) 864-5600 | |
Cameron Donahue, Hayden IR (651) 653-1854; cameron@haydenir.com | |
SOURCE Advanced Photonix, Inc.
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