Dynasil Corporation of America (NASDAQ: DYSL), a leading developer of sensing, detection and analysis technology for homeland security, medical and industrial applications, today announced financial results for the fiscal 2013 first quarter ended December 31, 2012.
“Our first-quarter results underscore our focus on right-sizing the cost structure of our various businesses as we work to conserve cash, work through our debt issues and achieve profitability,” said Dynasil Chairman and Interim CEO Peter Sulick. “In the first quarter of fiscal 2013 we were able to reduce operating expenses to their lowest level in five quarters,” said Dynasil Chairman and Interim CEO Peter Sulick. “Total operating expenses decreased from the first quarter of 2012 and were down 5.5% on a sequential basis. General and administrative expenses, which represent a significant component of our total operating expenses, have declined by over $300,000 as compared to the first quarter of fiscal year 2012.”
Net revenue for the first quarter of fiscal 2013 was $10.6 million, compared with $12.1 million for the first quarter of fiscal 2012. Contract Research revenues declined to $4.9 million from $6.2 million in the first quarter of fiscal 2012, primarily due to lower billable material and subcontractor costs in the 2013 period. The Company’s Contract Research backlog has remained consistent at nearly 18 months. Instruments segment revenues were $1.3 million in the first quarter of fiscal 2013 compared with $2.0 million for the 2012 comparable period. The Company attributes this result to customers delaying the purchase of two existing products, a lead paint analyzer and gamma medical probe, in anticipation of the availability of new versions of these products. Dynasil has completed development work on both refreshed products, which are awaiting required regulatory approvals. Offsetting these revenue decreases were increases in the Company’s Optics business of approximately $300,000.
Gross profit for the first quarter of 2013 totaled $4.6 million, or 43.8% of net revenue, compared with $5.1 million, or 42.3% of revenue for the first quarter of fiscal 2012.
Total operating expenses for the first quarter of fiscal 2013 declined to $4.8 million from $4.9 million for the same period of 2012.
Dynasil reported a net loss for the fiscal 2013 first quarter of $0.4 million, or $0.03 per share, compared with net income of $0.4 million, or $0.02 per diluted share, for the same period of 2012.
On December 31, 2012, the Company announced it is in default of certain financial covenants set forth in the terms of its outstanding indebtedness with respect to its fiscal year ended September 30, 2012. The Company continues to be current with all principal and interest payments due on all its outstanding indebtedness and management expects to continue discussions with its lenders to address the financial covenant situation. However, the Company cannot predict when or whether a resolution of this situation will be achieved.
Recent Highlights: Delivery of Pilot Production Order to Thermo Fisher Scientific
In January 2013, Dynasil announced that Thermo Fisher Scientific Inc. (NYSE: TMO) is integrating the Company’s proprietary gamma and neutron scintillator detection technology, known as CLYC, into the Thermo Fisher Scientific RadEye® GN+ Personal Radiation Detector. The device is being deployed to homeland security, defense and law enforcement agencies worldwide.
“We are excited about the prospects of our CLYC dual mode scintillator crystals for homeland security applications as well as other large market opportunities,” Sulick said. “In addition to being able to identify illicit nuclear materials and other threats, our CLYC crystals have broad applicability in industries such as well-logging, where they are used to determine the presence of rocks, minerals, oil, gas and other substances of value. Our Hilger Crystals business unit, which is commercializing this program with support from our RMD business, continues to significantly enhance the CLYC production processes. We have received expressions of interest in CLYC from several prospective customers, and are engaged in design activity on a number of fronts.”
Conference Call Information
Dynasil will host a conference call for investors and analysts at 5:00 p.m. ET today. The call will be hosted by Chairman and Interim CEO and President Peter Sulick and Chief Financial Officer Thomas Leonard. Those who wish to listen to the conference call should visit the Investor Information section of the Company’s website at www.dynasil.com. The call also may be accessed by dialing (877) 407-5790 or (201) 689-8328. For interested individuals unable to join the live conference call, a webcast replay will be available on the Company’s website for one year.
Dynasil Corporation of America (NASDAQ: DYSL) develops and manufactures detection and analysis technology, precision instruments and optical components for the homeland security, medical and industrial markets. Combining world-class technology with expertise in research and materials science, Dynasil is commercializing products including dual-mode radiation detection solutions for Homeland Security and commercial applications, probes for medical imaging and sensors for non-destructive testing. The Company is building a relationship with the Mayo Clinic to develop early-stage opportunities such as advanced biomedical technologies. Dynasil has an impressive and growing portfolio of issued and pending U.S. patents. The Company is based in Watertown, Massachusetts, with additional operations in Mass., Minn., NY, NJ and the United Kingdom. More information about the Company is available at www.dynasil.com.
This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements regarding future events and our future results are based on current expectations, estimates, forecasts, and projections and the beliefs and assumptions of our management, including, without limitation, our expectations regarding results of operations, the commercialization of our products including our dual mode detectors, the adequacy of our current financing sources to fund our current operations, our growth initiatives, our capital expenditures and the strength of our intellectual property portfolio. These forward-looking statements may be identified by the use of words such as “may,” “could,” “expect,” “estimate,” “anticipate,” “continue” or similar terms, though not all forward-looking statements contain such words. The actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements due to a number of important factors. These factors that could cause actual results to differ from those anticipated or predicted include, without limitation, our ability to resolve our current default under our outstanding indebtedness, our ability to develop and commercialize our products, including obtaining regulatory approvals, the size and growth of the potential markets for our products and our ability to serve those markets, the rate and degree of market acceptance of any of our products, our ability to address our material weaknesses in our internal controls, general economic conditions, costs and availability of raw materials and management information systems, our ability to obtain and maintain intellectual property protection for our products, competition, the loss of key management and technical personnel, our ability to obtain timely payment of our invoices to governmental customers, litigation, the effect of governmental regulatory developments, the availability of financing sources, our ability to identify and execute on acquisition opportunities and integrate such acquisitions into our business, and seasonality, as well as the uncertainties set forth in the Company’s Annual Report on Form 10-K, including the risk factors contained in Item 1a, and from time to time in the Company's other filings with the Securities and Exchange Commission. The Company disclaims any intention or obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
|Dynasil Corporation of America and Subsidiaries|
|Consolidated Balance Sheets|
|Cash and cash equivalents||$2,471,900||$3,414,880|
|Accounts receivable, net||4,849,552||5,475,142|
|Cost in excess of billings and unbilled receivables||1,941,547||1,735,798|
|Inventories, net of reserves||3,550,710||3,271,700|
|Deferred tax asset||126,187||126,187|
|Prepaid expenses and other current assets||1,401,925||1,334,649|
|Total current assets||14,341,821||15,358,356|
|Property, Plant and Equipment, net||5,093,097||4,984,150|
|Deferred financing costs, net||152,650||165,457|
|Total other assets||16,944,757||17,122,922|
|LIABILITIES AND STOCKHOLDERS' EQUITY|
|Current portion of long-term debt||$11,511,905||$11,984,492|
|Accrued expenses and other liabilities||1,951,680||2,809,580|
|Total current liabilities||17,097,886||17,905,141|
|Deferred tax liability||365,328||371,256|
|Total long-term liabilities||708,176||716,699|
|Total Liabilities and Stockholders' Equity||$36,379,675||$37,465,428|
|Dynasil Corporation of America|
Consolidated Statement of Operations
|Three Months Ended|
|Cost of revenue||5,926,409||7,005,347|
|Sales and marketing expenses||479,878||392,801|
|Research and development expenses||637,129||519,395|
|General and administrative expenses||3,701,146||4,028,24|
|Total operating expenses||4,818,153||4,940,620|
|Income (loss) from operations||(191,287||)||186,328|
|Interest expense, net||186,767||124,157|
|Income (loss) before income tax (benefit) provision||(378,044||)||62,171|
|Income tax (benefit) provision||1,298||(308,167||)|
|Net income (loss)||($379,342||)||$370,338|
|Net Income (loss)||($379,342||)||$370,338|
|Other comprehensive income (loss):|
|Foreign currency translation||29,739||(60,360||)|
|Total comprehensive income (loss)||($349,603||)||$309,978|
|Basic net income per common share||($0.03||)||$0.02|
|Diluted net income per common share||($0.03||)||$0.02|
|Weighted average shares outstanding|