Precision Optics Reports Third Quarter Fiscal Year 2023 Financial Results

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.

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
[email protected]

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:

SOURCE Precision Optics Corporation