Net income from continuing operations improved to
For the three months ended
“We are extremely pleased with our third quarter financial results,"
said
Third Quarter Financial Summary
Total revenues for the three months ended September 30, 2017, were
Gross profit was
Selling, general and administrative expenses were
Research, development and engineering expenses remained substantially
unchanged at
Net income from continuing operations improved to
Net income attributable to common stockholders for the three months
ended
Year to Date Financial Summary
Total revenues for the nine months ended
Gross profit increased to
Selling, general and administrative expenses decreased to
Research, development and engineering expenses decreased to
Net loss from continuing operations improved to
Net income/(loss) attributable to common stockholders improved to a net
income of
Non-GAAP Measures
In evaluating the operating performance of its business, Luna’s management considers Adjusted EBITDA, which excludes certain charges and credits that are required by generally accepted accounting principles (“GAAP”). Adjusted EBITDA provides useful information to both management and investors by excluding the effect of certain non-cash expenses and items that Luna believes may not be indicative of its operating performance, because either they are unusual and Luna does not expect them to recur in the ordinary course of its business or they are unrelated to the ongoing operation of the business in the ordinary course. Adjusted EBITDA should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. Adjusted EBITDA has been reconciled to the nearest GAAP measure in the table following the financial statements attached to this press release.
Conference Call Information
As previously announced, Luna will conduct an investor conference call
at
About Luna
Forward-Looking Statements
The statements in this release that are not historical facts constitute
“forward-looking statements” made pursuant to the safe harbor provision
of the Private Securities Litigation Reform Act of 1995 that involve
risks and uncertainties. These statements include Luna's expectations
regarding the high growth potential within Luna's strategic initiative.
Management cautions the reader that these forward-looking statements are
only predictions and are subject to a number of both known and unknown
risks and uncertainties, and actual results, performance, and/or
achievements of Luna may differ materially from the future results,
performance, and/or achievements expressed or implied by these
forward-looking statements as a result of a number of factors. These
factors include, without limitation, failure of demand for Luna's
products and services to meet expectations, technological challenges and
those risks and uncertainties set forth in Luna’s periodic reports and
other filings with the
Luna Innovations Incorporated | ||||||||||||||||
Consolidated Statements of Operations | ||||||||||||||||
|
||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(unaudited) | (unaudited) | |||||||||||||||
Revenues: | ||||||||||||||||
Technology development | $ | 4,590,054 | $ | 4,118,245 | $ | 13,428,428 | $ | 11,772,731 | ||||||||
Products and licensing | 7,052,094 | 7,066,908 | 19,593,648 | 18,301,631 | ||||||||||||
Total revenues | 11,642,148 | 11,185,153 | 33,022,076 | 30,074,362 | ||||||||||||
Cost of revenues: | ||||||||||||||||
Technology development | 3,491,840 | 3,068,360 | 10,045,261 | 8,986,312 | ||||||||||||
Products and licensing | 3,617,547 | 3,758,765 | 10,201,459 | 9,954,987 | ||||||||||||
Total cost of revenues | 7,109,387 | 6,827,125 | 20,246,720 | 18,941,299 | ||||||||||||
Gross profit | 4,532,761 | 4,358,028 | 12,775,356 | 11,133,063 | ||||||||||||
Operating expense: | ||||||||||||||||
Selling, general and administrative | 3,256,074 | 3,816,679 | 10,345,964 | 11,296,389 | ||||||||||||
Research, development and engineering | 833,811 | 812,050 | 2,581,473 | 2,789,801 | ||||||||||||
Total operating expense | 4,089,885 | 4,628,729 | 12,927,437 | 14,086,190 | ||||||||||||
Operating income/(loss) | 442,876 | (270,701 | ) | (152,081 | ) | (2,953,127 | ) | |||||||||
Other income (expense): | ||||||||||||||||
Other expense | (3,389 | ) | (231 | ) | (4,258 | ) | (1,904 | ) | ||||||||
Interest expense | (55,099 | ) | (71,991 | ) | (179,860 | ) | (237,081 | ) | ||||||||
Total other expense | (58,488 | ) | (72,222 | ) | (184,118 | ) | (238,985 | ) | ||||||||
Income/(loss) from continuing operations before income taxes | 384,388 | (342,923 | ) | (336,199 | ) | (3,192,112 | ) | |||||||||
Income tax (benefit)/expense | (130,977 | ) | 44,797 | (63,350 | ) | (173,801 | ) | |||||||||
Net income/(loss) from continuing operations | 515,365 | (387,720 | ) | (272,849 | ) | (3,018,311 | ) | |||||||||
Gain on sale, net of $1,508,373 of related income taxes | 15,096,666 | — | 15,096,666 | — | ||||||||||||
Income/(loss) from discontinued operations, net of income tax (benefit)/expense of $(349,515), $(35,095), $(349,515), and $209,678. |
145,293 | (57,358 | ) | (644,241 | ) | 342,685 | ||||||||||
Net income/(loss) from discontinued operations | 15,241,959 | (57,358 | ) | 14,452,425 | 342,685 | |||||||||||
Net income/(loss) | 15,757,324 | (445,078 | ) | 14,179,576 | (2,675,626 | ) | ||||||||||
Preferred stock dividend | 33,699 | 28,941 | 97,331 | 74,731 | ||||||||||||
Net income/(loss) attributable to common stockholders | $ | 15,723,625 | $ | (474,019 | ) | $ | 14,082,245 | $ | (2,750,357 | ) | ||||||
Net income/(loss) per share from continuing operations: | ||||||||||||||||
Basic | $ | 0.02 | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.11 | ) | |||||
Diluted | $ | 0.02 | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.11 | ) | |||||
Net income/(loss) per share from discontinued operations: | ||||||||||||||||
Basic | $ | 0.55 | $ | 0.00 | $ | 0.52 | $ | 0.01 | ||||||||
Diluted | $ | 0.47 | $ | 0.00 | $ | 0.52 | $ | 0.01 | ||||||||
Net income/(loss) per share attributable to common stockholders: | ||||||||||||||||
Basic | $ | 0.57 | $ | (0.02 | ) | $ | 0.51 | $ | (0.10 | ) | ||||||
Diluted | $ | 0.48 | $ | (0.02 | ) | $ | 0.51 | $ | (0.10 | ) | ||||||
Weighted average common shares and common equivalent shares outstanding: | ||||||||||||||||
Basic | 27,692,539 | 27,605,028 | 27,611,905 | 27,531,730 | ||||||||||||
Diluted | 32,714,389 | 27,605,028 | 27,611,905 | 27,531,730 | ||||||||||||
Luna Innovations Incorporated | ||||||||
Consolidated Balance Sheets | ||||||||
September 30, |
December 31, |
|||||||
(unaudited) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 38,514,437 | $ | 12,802,458 | ||||
Accounts receivable, net | 8,940,405 | 10,269,012 | ||||||
Inventory | 7,300,035 | 6,848,835 | ||||||
Prepaid expenses and other current assets | 924,196 | 1,375,659 | ||||||
Current assets held for sale | — | 5,801,629 | ||||||
Total current assets | 55,679,073 | 37,097,593 | ||||||
Property and equipment, net | 3,145,769 | 3,482,687 | ||||||
Intangible assets, net | 3,264,285 | 3,367,217 | ||||||
Goodwill | 502,000 | 502,000 | ||||||
Long term receivable- sale of HSOR business | 4,000,000 | — | ||||||
Other assets | 18,024 | 38,194 | ||||||
Non-current assets held for sale | — | 10,509,282 | ||||||
Total assets | $ | 66,609,151 | $ | 54,996,973 | ||||
Liabilities and stockholders’ equity | ||||||||
Liabilities: | ||||||||
Current liabilities: | ||||||||
Current portion of long-term debt obligations | $ | 1,833,333 | $ | 1,833,333 | ||||
Current portion of capital lease obligations | 49,070 | 52,128 | ||||||
Accounts payable | 2,188,776 | 2,954,742 | ||||||
Accrued liabilities | 9,586,554 | 7,913,544 | ||||||
Deferred revenue | 897,023 | 837,906 | ||||||
Current liabilities held for sale | — | 2,376,703 | ||||||
Total current liabilities | 14,554,756 | 15,968,356 | ||||||
Long-term deferred rent | 1,221,170 | 1,319,402 | ||||||
Long-term debt obligations | 1,057,263 | 2,420,032 | ||||||
Long-term capital lease obligations | 79,246 | 114,940 | ||||||
Non-current liabilities held for sale | — | 84,555 | ||||||
Total liabilities | 16,912,435 | 19,907,285 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, par value $0.001, 1,321,514 shares authorized, issued and outstanding at September 30, 2017 and December 31, 2016 | 1,322 | 1,322 | ||||||
Common stock, par value $0.001, 100,000,000 shares authorized, 28,402,887 and 27,988,104 shares issued, 27,815,060 and 27,541,277 shares outstanding at September 30, 2017 and December 31, 2016 | 29,074 | 28,600 | ||||||
Treasury stock at cost, 587,827 and 446,827 shares at September 30, 2017 and December 31, 2016 | (746,007 | ) | (517,987 | ) | ||||
Additional paid-in capital | 83,204,263 | 82,451,958 | ||||||
Accumulated deficit | (32,791,936 | ) | (46,874,205 | ) | ||||
Total stockholders’ equity | 49,696,716 | 35,089,688 | ||||||
Total liabilities and stockholders’ equity | $ | 66,609,151 | $ | 54,996,973 | ||||
Luna Innovations Incorporated | ||||||||
Consolidated Statements of Cash Flows | ||||||||
Nine Months Ended September 30, | ||||||||
2017 | 2016 | |||||||
(unaudited) | ||||||||
Cash flows provided by/(used in) operating activities | ||||||||
Net income/(loss) | $ | 14,179,576 | $ | (2,675,626 | ) | |||
Adjustments to reconcile net income/(loss) to net cash used in operating activities | ||||||||
Depreciation and amortization | 2,241,867 | 2,759,877 | ||||||
Share-based compensation | 476,428 | 665,354 | ||||||
Bad debt expense | 40,753 | 255,522 | ||||||
Loss on disposal of fixed assets | 3,640 | — | ||||||
Gain on sale of discontinued operations | (15,096,666 | ) | ||||||
Change in assets and liabilities | ||||||||
Accounts receivable | 2,127,794 | (1,197,885 | ) | |||||
Inventory | (2,251,236 | ) | 964,443 | |||||
Other current assets | 380,858 | (381,632 | ) | |||||
Accounts payable and accrued expenses | (1,581,608 | ) | (1,055,060 | ) | ||||
Deferred revenue | 59,980 | (120,871 | ) | |||||
Net cash provided by/(used in) operating activities | 581,386 | (785,878 | ) | |||||
Cash flows provided by/(used in) investing activities | ||||||||
Acquisition of property and equipment | (893,698 | ) | (1,433,260 | ) | ||||
Intangible property costs | (392,485 | ) | (317,287 | ) | ||||
Proceeds from sale of property and equipment | 3,000 | — | ||||||
Proceeds from sales of discontinued operations | 28,026,528 | — | ||||||
Net cash provided by/(used in) investing activities | 26,743,345 | (1,750,547 | ) | |||||
Cash flows provided by/(used in) financing activities | ||||||||
Payments on capital lease obligations | (38,752 | ) | (44,404 | ) | ||||
Payments of debt obligations | (1,375,000 | ) | (1,375,000 | ) | ||||
Repurchase of common stock | (228,020 | ) | (325,060 | ) | ||||
Proceeds from the exercise of options | 29,020 | — | ||||||
Net cash used in financing activities | (1,612,752 | ) | (1,744,464 | ) | ||||
Net decrease in cash or cash equivalents | 25,711,979 | (4,280,889 | ) | |||||
Cash and cash equivalents-beginning of period | 12,802,458 | 17,464,040 | ||||||
Cash and cash equivalents-end of period | $ | 38,514,437 | $ | 13,183,151 | ||||
Luna Innovations Incorporated | |||||||||||||||||
Reconciliation of Net Loss to EBITDA and Adjusted EBITDA | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||||
Net income/(loss) | $ | 15,757,324 | $ | (445,078 | ) | $ | 14,179,576 | $ | (2,675,626 | ) | |||||||
Less income/(loss) from discontinued operations, net of income taxes | 15,241,959 | (57,358 | ) | 14,452,425 | 342,685 | ||||||||||||
Net income/(loss) from continuing operations | 515,365 | (387,720 | ) | (272,849 | ) | (3,018,311 | ) | ||||||||||
Interest expense | 55,099 | 71,991 | 179,860 | 237,081 | |||||||||||||
Tax (benefit)/expense | (130,977 | ) | 44,797 | (63,350 | ) | (173,801 | ) | ||||||||||
Depreciation and amortization | 279,147 | 327,235 | 929,615 | 1,089,240 | |||||||||||||
EBITDA | 718,634 | 56,303 | 773,276 | (1,865,791 | ) | ||||||||||||
Share-based compensation | 154,671 | 200,326 | 476,428 | 665,354 | |||||||||||||
Adjusted EBITDA | $ | 873,305 | $ | 256,629 | $ | 1,249,704 | $ | (1,200,437 | ) | ||||||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20171113006226/en/
Source:
Investor Contact:
Luna Innovations Incorporated
Dale
Messick, CFO, 1-540-769-8400
IR@lunainc.com