The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain
(“ProPhotonix” or “the Company”)
INTERIM RESULTS FOR THE HALF YEAR ENDED JUNE 30, 2019
SALEM, NH / ACCESSWIRE / September 6, 2019 / ProPhotonix Limited (London Stock Exchange - AIM: PPIX & PPIR, OTC: STKR), a high technology designer and manufacturer of LED illumination systems and laser diode modules, with operations in Ireland and the United Kingdom, today announces its unaudited interim results for the six months ended June 30, 2019.
- Revenue decreased 18.9% to $7.2 million (H1-2018: $8.8 million)
- Gross profit decreased 21.7% to $2.7 million (H1-2018: $3.4 million) mainly due to decreased revenue
- Operating loss (excluding stock compensation credit $0.5 million) of $0.6 million (H1-2018: $0.1 million operating income, excluding stock compensation expense $0.5 million)
- Net loss of $0.2 million (H1-2018: $0.5 million)
- Adjusted EBITDA of $(0.5) million (H1-2018: $0.2 million). Please see the reconciliation of net loss to adjusted EBITDA below.
- Order bookings of $7.5 million (H1-2018: $9.0 million)
- Book-to-Bill ratio of 1.04 (H1-2018: 1.03)
- Percentage revenue by market sectors: 73% industrial, 23% medical and 4% security & defense (H1-2018: 81% industrial, 16% medical and 3% security & defense)
- Percentage revenue by geography: 40% Europe, 58% North America and 2% Rest of World (H1-2018: 56% Europe, 31% North America and 13% Rest of World)
Tim Losik, President & CEO, commented:
"Revenues in the first half of 2019 were down 18.9% primarily due to a decrease in Laser & Diode product sales (including the decline of $0.9 million from the largest customer due to a delay in a new product launch) partially offset by a small net increase in LED product sales. Gross profit margin fell to 37.2% compared with 38.6% for the same period in 2018, mainly due to a shift in product mix and under absorption of manufacturing overhead on lower sales. In the first half of 2019 we experienced an operating loss of $0.1 million compared to operating loss of $0.4 million in 2018. The operating loss was primarily a result of lower profit margins and continued investment to support future growth of the business, offset by a credit of stock compensation of $0.5 million for 2019 (1H 2018 - expense $0.5 million). During the first half, cost reduction measures were put in place to lower the cost structure by about $0.3 million per annum.
The cash position of the Company has reduced due to operating losses incurred and will likely continue, though at a slower rate as the cost reduction measures take effect, through the balance of the year. The Directors are investigating securing new sources of capital as well as other strategic initiatives and options.”
Trading update and Strategic Review
“Decreased revenue has occurred in nearly half of 2018 customers offset by increases in about 25% of customers, albeit we take some reassurance that during the first half our largest laser customer and several large LED customers resumed and/or increased both the volume and value of orders placed with Prophotonix. Overall however, the volume of orders were down 17% in the half despite these customers increasing orders, and continue to be sluggish early in the second half. Currently, we are not able to accurately estimate full year sales, but the Board currently envisage they will be no more than $15.0 million.
“As noted above, we are now forecasting revenues in the second half will broadly approximate those achieved in the first half. Whilst we expect to see the financial benefit of the cost savings initiatives enacted in the first half, the Board believes the Company will continue to be loss making and is committed to strengthening the Group’s balance sheet. The Board is therefore reviewing all funding and strategic options available, both to ensure the short-term working capital needs of the Company continue to be met, as well as maximizing shareholder value over the longer term.”
Tim Losik, President & CEO
Tel: +1 603 893 8778
Cantor Fitzgerald Europe
(Nominated Adviser and Broker) Tel: +44 (0)207 894 7000
David Foreman (Corporate Finance)
Keith Dowsing (Equity Sales)
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SOURCE: ProPhotonix Limited