Kopin Corporation (KOPN), a leading developer of innovative wearable computing technologies and solutions, today provided an update on its business initiatives and reported financial results for the third quarter of 2015, ended September 26.
“In the third quarter we further expanded our leadership position as a provider of components to the wearables market, adding another Tier-One customer for our displays and optics technologies,” said John C.C. Fan, President and CEO of Kopin. “With the addition of this customer we now have five Tier-One customers offering wearable technology products based on our technologies, with three focused on the enterprise segment and two targeted at the consumer market. Our revenues from sales of products for the wearable market through the nine months ended September 26, 2015 was $10.6 million, a twofold increase over the same period in 2014. Our optical, display, audio and software technologies are being evaluated by companies around the globe, as the interest in wearables gains momentum across industries and applications.”
“This interest extends to our own Solos cycling eyewear, which was introduced to a very enthusiastic cycling community at North America’s largest cycling trade show, Interbike, in October. These ultra-lightweight glasses feature our Vista optics and display technologies to create a 5-inch virtual color screen, which provide the rider with biometric and situational data to improve their performance. Importantly, Solos successfully matches fashion with function, which Kopin has long believed is key to the adoption of wearable technologies. We look for the functionality of Solos to be significantly expanded with the addition of our speech enhancement and battery technologies, which we expect to debut at CES in January.”
“We also celebrated Kopin’s 30th anniversary in October which was a chance to review our many accomplishments, from the creation of the heterojunction bipolar transistor, which was key to the expansion of wireless communication, to the development of our display technologies, which enabled new categories of consumer products. We also demonstrated our most recent development efforts, our speech enhancement technology, which combined with our proprietary display, optical and electronics has created Kopin’s leadership position in wearables today. We are on track to meet the goals that we established in 2013 when we announced our focus on the wearable technology market. Tangible evidence of this will be at CES this January as we expect between 5 to 10 companies to show products based on our technologies. With over $87 million in cash and marketable securities I am even more excited about the next 30 years, with the resources in place to maximize the opportunities ahead,” concluded Dr. Fan.
Third Quarter Financial Results
Total revenues for the third quarter ended September 26, 2015, were $8.0 million, compared with $9.5 million for the third quarter of 2014.
Research and development expenses for the third quarter of 2015 were $4.0 million compared with $4.8 million for the third quarter of 2014.
Selling, general and administrative expenses were $4.6 million in the third quarter of 2015, compared with approximately $5.0 million in the same period of 2014.
Other income and expense was $1.4 million of income for the third quarter of 2015 as compared to an income of $0.5 million for the third quarter of 2014.
Net loss for the third quarter of 2015 was $4.6 million, or $0.07 per diluted share, compared with net loss of $5.0 million, or $0.08 per share, for the same period of 2014.
Kopin’s cash, equivalents and marketable securities was $87.3 million at September 26, 2015 as compared to $90.9 million at December 27, 2014. Kopin has no long-term debt. Our cash position is expected to be further enhanced in January of 2016 when we expect to receive payment of the $15 million note receivable from the sale of our III-V product line and investment in Kopin Taiwan Corporation.
All amounts above are estimates and readers should refer to our Form 10-Q for the quarter ended September 26, 2015, for final disposition.
Financial Results Conference Call
In conjunction with its third quarter 2015 financial results, Kopin will host a teleconference call for investors and analysts at 8:30 a.m. ET today. To participate, please dial (877) 709-8150 (U.S. and Canada) or (201) 689-8354 (International). The call will also be available as a live and archived audio webcast on the “Investors” section of the Kopin website, www.kopin.com.
About Kopin
Kopin Corporation is a leading developer and provider of innovative wearable technologies and solutions for integration into head-worn computing and display systems to military, industrial and consumer customers. Kopin’s technology portfolio includes ultra-small displays, optics, speech enhancement technology, system and hands-free control software, low-power ASICs, and ergonomically designed smart headset reference systems. Kopin’s proprietary components and technology are protected by more than 300 global patents and patents pending. For more information, please visit Kopin’s website at www.kopin.com.
Kopin and Voice Extraction are trademarks of Kopin Corporation.
Forward-Looking Statements
Statements in this press release may be considered “forward-looking” statements under the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. These include, without limitation, statements relating to our expectation that the functionality of Solos will be expanded with the addition of our speech enhancement and battery technologies which we expect to debut at CES in January; our expectation that between 5 and 10 companies to show products based on our technologies at CES in January; our expectation that our cash position will be further enhanced when we will receive payment of the $15 million note receivable from the sale of our III-V product line and investment in Kopin Taiwan Corporation, in January 2016. These statements involve a number of risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. These risks and uncertainties include, but are not limited to, the following: technical, environmental, scheduling and other issues may prevent us or our customers from presenting at the CES in January; we may be unable to debut our speech enhancement and battery technologies at CES in January; we may be unable to incorporate our speech enhancements and battery technologies in Solos by CES in January; we may not receive the payment of the $15 million note receivable from the sale of our III-V product line and investment in Kopin Taiwan Corporation; the final amounts in the Company’s Form 10-Q for the period ended September 26, 2015 may differ from the amounts included in the release above; it may take longer than the Company estimates to develop products; the Company’s products may not be accepted by the market place; there may be issues that prevent the adoption or further development of the Company’s wearable computing technologies; manufacturing, marketing or other issues may prevent either the adoption or acceptance of products; the Company might be adversely affected by competitive products and pricing; new product initiatives and other research and development efforts may be unsuccessful; the Company could experience the loss of significant customers; costs to produce the Company’s products might increase significantly, or yields could decline; the Company’s customers might be unable to ramp production volumes of their products, or the Company’s product forecasts could turn out to be wrong; manufacturing delays, technical issues, economic conditions or external factors may prevent the Company from achieving its goals; and other risk factors and cautionary statements listed in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the 12 months ended December 27, 2014, and the Company’s subsequent filings with the Securities and Exchange Commission. You should not place undue reliance on any forward-looking statements, which are based only on information currently available to the Company and only as of the date on which they are made. The Company undertakes no obligation to update any of these forward-looking statements to reflect events or circumstances occurring after the date of this release.
Kopin Corporation | ||||||||||||||
Supplemental Information | ||||||||||||||
(Unaudited) | ||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||
| September 26, 2015 | September 27, 2014 | September 26, 2015 | September 27, 2014 | |||||||||||
| Display Revenues by Category (in millions) | ||||||||||||||
| Military Applications | $ | 1.9 | $ | 5.7 | $ | 8.9 | $ | 8.3 | ||||||
| Wearable Applications | 3.5 | 1.7 | 10.6 | 4.8 | ||||||||||
| Industrial Applications | 1.2 | 1.0 | 2.9 | 2.8 | ||||||||||
| Consumer Electronics Applications | 0.5 | 0.6 | 1.3 | 2.3 | ||||||||||
| Research and Development | 0.9 | 0.5 | 3.7 | 3.0 | ||||||||||
| Total | $ | 8.0 | $ | 9.5 | $ | 27.4 | $ | 21.2 | ||||||
| Stock-Based Compensation Expense | ||||||||||||||
| Continuing Operations | ||||||||||||||
| Cost of component revenues | $ | 159,000 | $ | 118,000 | $ | 620,000 | $ | 590,000 | ||||||
| Research and development | 166,000 | 136,000 | 670,000 | 773,000 | ||||||||||
| Selling, general and administrative | 439,000 | 939,000 | 1,496,000 | 2,192,000 | ||||||||||
| $ | 764,000 | $ | 1,193,000 | $ | 2,786,000 | $ | 3,555,000 | |||||||
| Other Financial Information | ||||||||||||||
| Depreciation and amortization | $ | 670,000 | $ | 808,000 | $ | 1,860,000 | $ | 2,588,000 | ||||||
| Capital expenditures | $ | 114,000 | $ | 566,000 | $ | 765,000 | $ | 1,544,000 | ||||||
| Treasury stock purchases | $ | - | $ | - | $ | - | $ | 299,000 | ||||||
| Kopin Corporation | ||||||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||
| September 26, 2015 | September 27, 2014 | September 26, 2015 | September 27, 2014 | |||||||||||||||
| Revenues: | ||||||||||||||||||
| Component revenues | $ | 7,119,145 | $ | 9,066,028 | $ | 23,734,238 | $ | 18,200,451 | ||||||||||
| Research and development revenues | 881,781 | 465,995 | 3,708,286 | 2,969,629 | ||||||||||||||
| 8,000,926 | 9,532,023 | 27,442,524 | 21,170,080 | |||||||||||||||
| Expenses: | ||||||||||||||||||
| Cost of component revenues | 5,357,217 | 5,204,125 | 17,000,729 | 13,583,313 | ||||||||||||||
| Research and development | 4,008,391 | 4,832,469 | 13,752,593 | 15,055,723 | ||||||||||||||
| Selling, general and administrative | 4,558,612 | 5,015,367 | 14,053,053 | 14,933,424 | ||||||||||||||
| 13,924,220 | 15,051,961 | 44,806,375 | 43,572,460 | |||||||||||||||
| Loss from operations | (5,923,294 | ) | (5,519,938 | ) | (17,363,851 | ) | (22,402,380 | ) | ||||||||||
| Other income (expense), net | 1,350,934 | 495,046 | 9,757,131 | (624,889 | ) | |||||||||||||
Loss before (provision) benefit for income taxes, equity loss in unconsolidated affiliate and net (income) loss from noncontrolling interest | (4,572,360 | ) | (5,024,892 | ) | (7,606,720 | ) | (23,027,269 | ) | ||||||||||
| (Provision) benefit for income taxes | (12,500 | ) | (44,000 | ) | (37,500 | ) | 62,000 | |||||||||||
Loss before equity loss in unconsolidated affiliate and net (income) loss from noncontrolling interest | (4,584,860 | ) | (5,068,892 | ) | (7,644,220 | ) | (22,965,269 | ) | ||||||||||
| Equity loss in unconsolidated affiliate | - | (35,016 | ) | (47,443 | ) | (259,874 | ) | |||||||||||
| Net loss before (income) loss attributable to noncontrolling interest | (4,584,860 | ) | (5,103,908 | ) | (7,691,663 | ) | (23,225,143 | ) | ||||||||||
| Net (income) loss attributable to noncontrolling interest | (13,690 | ) | 134,468 | 36,094 | 315,344 | |||||||||||||
| Net loss | $ | (4,598,550 | ) | $ | (4,969,440 | ) | $ | (7,655,569 | ) | $ | (22,909,799 | ) | ||||||
| Net loss per share: | ||||||||||||||||||
| Basic | $ | (0.07 | ) | $ | (0.08 | ) | $ | (0.12 | ) | $ | (0.37 | ) | ||||||
| Diluted | $ | (0.07 | ) | $ | (0.08 | ) | $ | (0.12 | ) | $ | (0.37 | ) | ||||||
| Weighted average number of common shares outstanding: | ||||||||||||||||||
| Basic | 63,068,321 | 62,646,757 | 63,072,668 | 62,606,822 | ||||||||||||||
| Diluted | 63,068,321 | 62,646,757 | 63,072,668 | 62,606,822 | ||||||||||||||
| Kopin Corporation | ||||||||||
| Condensed Consolidated Balance Sheets | ||||||||||
| (Unaudited) | ||||||||||
| September 26, 2015 | December 27, 2014 | |||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and marketable securities | $ | 87,339,457 | $ | 90,858,936 | ||||||
| Accounts receivable, net | 2,561,903 | 3,802,324 | ||||||||
| Inventory | 2,577,750 | 4,081,886 | ||||||||
| Prepaid and other current assets | 943,275 | 1,181,474 | ||||||||
| Note receivable | 14,983,339 | - | ||||||||
| Total current assets | 108,405,724 | 99,924,620 | ||||||||
| Land, equipment and improvements, net | 3,641,729 | 4,589,421 | ||||||||
| Goodwill and intangible assets | 1,115,377 | 1,593,210 | ||||||||
| Other assets | 1,713,671 | 1,900,828 | ||||||||
| Note receivable | - | 14,933,335 | ||||||||
| Total assets | $ | 114,876,501 | $ | 122,941,414 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 3,708,911 | $ | 5,503,734 | ||||||
| Accrued expenses | 5,617,936 | 5,870,719 | ||||||||
| Deferred income taxes | 1,282,000 | 1,282,000 | ||||||||
| Billings in excess of revenue earned | 1,485,146 | 586,471 | ||||||||
| Total current liabilities | 12,093,993 | 13,242,924 | ||||||||
| Lease commitments | 304,183 | 311,187 | ||||||||
| Total Kopin Corporation stockholders' equity | 103,086,499 | 109,846,959 | ||||||||
| Noncontrolling interest | (608,174 | ) | (459,656 | ) | ||||||
| Total stockholders' equity | 102,478,325 | 109,387,303 | ||||||||
| Total liabilities and stockholders' equity | $ | 114,876,501 | $ | 122,941,414 | ||||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20151103005516/en/
Contacts:
Richard Sneider, 508-870-5959
Treasurer
and Chief Financial Officer
Richard_Sneider@kopin.com
or
Market
Street Partners
Joann Horne, 415-445-3233
JHorne@marketstreetpartners.com
