Advanced Photonix Reports FY2013 Second Quarter Results
Advanced Photonix Reports FY2013 Second Quarter Results
ANN ARBOR, Mich.--(BUSINESS WIRE)-- Advanced Photonix, Inc.® (NYSE MKT: API) (the "Company") today reported results for the second quarter ended September 28, 2012.
Financial Highlights for the Second Quarter Ended September 28, 2012
Net sales for the quarter were $5.6 million, a decrease of $2.8 million or 33% from the second quarter ended September 30, 2011. Sequentially, revenues were down 10% relative to the first quarter of fiscal 2013.
Gross profit margin for Q2 2013 was 35.3% of sales compared to 42.7% for the same quarter of fiscal 2012. Price pressures in our high-speed optical receiver (HSOR) product line prior to cost reduction efforts and lower volumes affected the rate and gross margin dollars.
Current quarter net loss was $1,287,000 or $0.04 per diluted share, as compared to a quarterly loss of $254,000, or $0.01 per diluted share for the quarter ended September 30, 2011.
The Non-GAAP net loss for the second quarter of fiscal 2013 was $942,000 or $0.03 per diluted share, as compared to a Non-GAAP net income of $155,000, or $.01 per diluted share, for the second quarter last year.
Adjusted EBITDA (which is defined as GAAP earnings before interest, taxes, depreciation, amortization and stock compensation), was a negative $717,000 for the second quarter of fiscal 2013 as compared to positive adjusted EBITDA of $469,000 for the quarter ended September 30, 2011.
Operating Expenses
The Company's total operating expenses for the quarter were $3.2 million, down 17% compared to the $3.9 million reported for the second quarter last year. As a percent of revenue, total operating expenses were 58% compared to 47% for the second quarter last year.
Richard Kurtz, Chief Executive Officer, commented, "We continue to believe that our fiscal 2013 will have a much better second half. As with the other telecommunications suppliers we have seen weakness in network spending recently. This has caused us to be more cautious in our total year outlook. Our recent success in securing increased 100G business from one of our large OEM's for calendar year 2013 is a positive sign amid general softness we have seen from China and Europe due to challenging macro economic conditions. Our terahertz (THz) product platform is continuing to gain traction in industrial process control markets and we expect this growth to continue during the balance of the fiscal year and beyond. However due to the more challenging international macroeconomic environment, reduced U.S. military activities, and the looming U.S. fiscal cliff and their corresponding impact on our customer's expansion plans in the industrial and defense markets, we are projecting a more cautious outlook for the fiscal year. Due to these conditions we are changing revenue growth for the second half of our fiscal 2013 to a range of 15-25% higher than the first half."
Conference Call
The Company will hold a conference call to discuss the results for the second quarter ended September 28, 2012 on Tuesday, November 13, 2012, at 4:30 PM EST.
The conference call will be webcast live and will be accessible at http://advancedphotonix.investorroom.com. Participants can dial into the conference call at 888.680.0879 (617.213.4856 for international) using the passcode 93280290. A question and answer period will take place at the end of the discussion.
An audio replay of the call will be available shortly thereafter and will remain on-line until November 20, 2012. The replay number is 888.286.8010 (617.801.6888 for international) and the passcode is 27900435.
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, unforeseen technological obstacles which may prevent or slow the development and/or manufacture of new products; potential problems with the integration of the acquired company and its technology and possible inability to achieve expected synergies; obstacles to successfully combining product offerings and lack of customer acceptance of such offerings; 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; and the risk factors listed from time to time in the Company's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and any subsequent SEC filings. The Company assumes no obligation to update forward-looking statements contained in this release to reflect new information or future events or developments. API-G
CONDENSED CONSOLIDATED BALANCE SHEET | ||||||||
ASSETS | Sept 28, 2012 | Sept 30, 2011 | ||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 1,624,000 | $ | 3,249,000 | ||||
Receivables, net | 4,868,000 | 4,539,000 | ||||||
Inventories | 3,706,000 | 3,594,000 | ||||||
Prepaid expenses and other current assets | 468,000 | 261,000 | ||||||
Total current assets | 10,666,000 | 11,643,000 | ||||||
Equipment and leasehold improvements, net | 3,104,000 | 3,301,000 | ||||||
Goodwill | 4,579,000 | 4,579,000 | ||||||
Intangibles and patents, net | 4,024,000 | 4,538,000 | ||||||
Other assets | 352,000 | 322,000 | ||||||
Total assets | $ | 22,725,000 | $ | 24,383,000 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable and accrued expenses | $ | 2,593,000 | $ | 1,878,000 | ||||
Accrued compensation | 837,000 | 866,000 | ||||||
Current portion of long-term debt - bank term loan | 333,000 | 333,000 | ||||||
Current portion of long-term debt - bank line of credit | 800,000 | 500,000 | ||||||
Current portion of long-term debt - MEDC/MSF | 543,000 | 532,000 | ||||||
Total current liabilities | 5,106,000 | 4,109,000 | ||||||
Long-term debt, less current portion - MEDC/MSF | 656,000 | 929,000 | ||||||
Long-term debt, less current portion - bank term loan | 500,000 | 667,000 | ||||||
Warrant liability | 13,000 | 26,000 | ||||||
Total liabilities | 6,275,000 | 5,731,000 | ||||||
Shareholders' equity | ||||||||
Class A common stock, $.001 par value, 100,000,000 shares authorized; September 28, 2012 - 31,161,147 shares issued and outstanding; March 31, 2012 - 31,159,431 shares issued and outstanding | 31,000 | 31,000 | ||||||
Additional paid-in capital | 58,524,000 | 58,446,000 | ||||||
Accumulated deficit | (42,105,000 | ) | (39,825,000 | ) | ||||
Total shareholders' equity | 16,450,000 | 18,652,000 | ||||||
Total liabilities and shareholders' equity | $ | 22,725,000 | $ | 24,383,000 | ||||
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED) | ||||||||||||||||
Three months ended | Six months ended | |||||||||||||||
Sept 28, 2012 | Sept 30, 2011 | Sept 28, 2012 | Sept 30, 2011 | |||||||||||||
Sales, net | $ | 5,586,000 | $ | 8,120,000 | $ | 6,216,000 | $ | 8,120,000 | ||||||||
Cost of products sold | 3,612,000 | 4,742,000 | 3,972,000 | 4,742,000 | ||||||||||||
Gross profit | 1,974,000 | 3,378,000 | 2,244,000 | 3,378,000 | ||||||||||||
Operating expenses | ||||||||||||||||
Research and development | 1,342,000 | 1,692,000 | 1,371,000 | 1,692,000 | ||||||||||||
Sales and marketing | 496,000 | 1,159,000 | 1,053,000 | 1,159,000 | ||||||||||||
General and administrative | 1,119,000 | 342,000 | 292,000 | 342,000 | ||||||||||||
Amortization | 291,000 | 615,000 | 505,000 | 615,000 | ||||||||||||
Total operating expenses | 3,248,000 | 3,921,000 | 6,469,000 | 7,729,000 | ||||||||||||
Loss from operations | (1,274,000 | ) | (354,000 | ) | (2,251,000 | ) | (784,000 | ) | ||||||||
Other income (expense) | ||||||||||||||||
Interest income | -- | 2,000 | -- | 4,000 | ||||||||||||
Interest expense | (30,000 | ) | (31,000 | ) | (63,000 | ) | (62,000 | ) | ||||||||
Interest expense, related parties | -- | (13,000 | ) | -- | (28,000 | ) | ||||||||||
Change in fair value of warrant liability | (4,000 | ) | 142,000 | 13,000 | 634,000 | |||||||||||
Other income | 21,000 | -- | 21,000 | -- | ||||||||||||
Net loss | $ | (1,287,000 | ) | $ | (254,000 | ) | $ | (2,280,000 | ) | $ | (236,000 | ) | ||||
Net loss per common share | ||||||||||||||||
Basic and diluted | $ | (0.04 | ) | $ | (0.01 | ) | $ | (0.07 | ) | $ | (0.01 | ) | ||||
Weighted average common shares outstanding | ||||||||||||||||
Basic and diluted | 31,161,000 | 30,827,000 | 31,161,000 | 30,756,000 | ||||||||||||
Non-GAAP Financial Measures
The Company provides Non-GAAP Net Income, EBITDA and adjusted 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, EBITDA and adjusted 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, EBITDA and adjusted 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 | Six months ended | ||||||||||||||||
Sept 28, 2012 | Sept 30, 2011 | Sept 28, 2012 | Sept 30, 2011 | ||||||||||||||
Net income (loss) | $ | (1,287,000 | ) | $ | (254,000 | ) | $ | (2,280,000 | ) | $ | (236,000 | ) | |||||
Add back: | |||||||||||||||||
Change in warrant fair value | 4,000 | (142,000 | ) | (13,000 | ) | (634,000 | ) | ||||||||||
Amortization - intangibles/patents | 291,000 | 342,000 | 583,000 | 684,000 | |||||||||||||
Stock option compensation expense | 49,000 | 209,000 | 78,000 | 245,000 | |||||||||||||
Subtotal - add backs | 344,000 | 409,000 | 648,000 | 295,000 | |||||||||||||
Non-GAAP (loss) | $ | (943,000 | ) | $ | 155,000 | $ | (1,632,000 | ) | $ | 59,000 | |||||||
Net loss per common share | |||||||||||||||||
Basic and diluted | $ | (0.03 | ) | $ | 0.01 | $ | (0.05 | ) | $ | 0.00 | |||||||
Weighted average common shares outstanding | 31,161,000 | 30,827,000 | 31,161,000 | 30,756,000 | |||||||||||||
Basic and diluted | |||||||||||||||||
RECONCILIATION OF EBITDA AND ADJUSTED EBITDA TO GAAP (LOSS) | |||||||||||||||||
Three months ended | Six months ended | ||||||||||||||||
Sept 28, 2012 | Sept 30, 2011 | Sept 28, 2012 | Sept 30, 2011 | ||||||||||||||
Net income (loss) | $ | (1,287,000 | ) | $ | (254,000 | ) | $ | (2,280,000 | ) | $ | (236,000 | ) | |||||
Add Back: | |||||||||||||||||
Net interest expense (income) | 30,000 | 42,000 | 63,000 | 86,000 | |||||||||||||
Warrant (fair value) adjustment | 4,000 | (142,000 | ) | (13,000 | ) | (634,000 | ) | ||||||||||
Depreciation expense | 195,000 | 272,000 | 395,000 | 529,000 | |||||||||||||
Amortization | 291,000 | 342,000 | 583,000 | 684,000 | |||||||||||||
Subtotal - add backs | 520,000 | 514,000 | 1,028,000 | 665,000 | |||||||||||||
EBITDA | $ | (767,000 | ) | $ | 260,000 | $ | (1,252,000 | ) | $ | 429,000 | |||||||
Stock compensat | |||||||||||||||||
