Precision Optics Reports Second Quarter Fiscal Year 2021 Financial Results

Rhea-AI Summary

Precision Optics Corporation (OTCQB: PEYE) reported its second quarter fiscal 2021 results, revealing revenue of $2.79 million, nearly unchanged from the prior year's $2.80 million. Gross margins declined to 31% from 33% year-over-year. The company recorded a net loss of $213,000, significantly reduced from a loss of $551,000 in the previous year. Despite challenges from COVID-19 affecting production, there is optimism for an uptick in demand as restrictions ease. Engineering revenue for the first half of fiscal 2021 surpassed the total for fiscal 2020.

Positive

• Engineering revenue in the first half of fiscal 2021 exceeded all of fiscal 2020's total.
• The company's cash position remains strong at $816,000.

Negative

• Gross margins decreased from 33% to 31% year-over-year.
• The company reported a net loss of $213,000 in the quarter.

GARDNER, Mass., Feb. 16, 2021 /PRNewswire/ -- Precision Optics Corporation, Inc. (OTCQB: PEYE), a leading designer and manufacturer of advanced optical instruments for the medical and defense industries, announced operating results on an unaudited basis for its second quarter fiscal year ended December 31, 2020.

Second quarter fiscal 2021 highlights:

• Revenue for the quarter ended December 31, 2020 was $2.79 million compared to $2.80 million in the same quarter of the previous fiscal year, essentially flat year over year; and up slightly sequentially compared to $2.76 million in the quarter ended September 30, 2020.
• Gross margins for the quarter ended December 31, 2020 were 31% compared to 33% in the same quarter of the previous fiscal year; and compared to 35% for the quarter ended September 30, 2020.
• Net loss of $213,000 during the quarter included $157,000 of stock-based compensation. This compared to a loss of $551,000, including $275,000 of stock-based compensation in the same quarter of the previous fiscal year.
• The Company's cash position remains strong with an ending balance for the second quarter of $816,000.

Precision Optics' CEO, Joseph Forkey, commented, "The positive operating trends we saw in the first quarter continued as we reported another quarter of sequential revenue growth and significant year-over-year improvements in our adjusted EBITDA, all while still working through the ongoing impacts to certain commercial projects from COVID-19 discussed in recent quarters.  While our two largest customers continue to adjust the timing of ongoing production due to COVID-19 disruptions, both are optimistic about the long-term prospects for their products and anticipate an uptick in demand as pandemic restrictions start to subside.  Much of the reduction in revenue due to these delays has been filled by a significant increase in our Engineering product pipeline activity which has rebounded strongly after a lull at the beginning of the pandemic almost a year ago."

Dr. Forkey continued, "Capitalizing on these opportunities, our team has done a great job of expanding our pipeline and advancing key projects to pre-commercialization stage. A strong indicator of this progress is that engineering revenue through the first six months of fiscal 2021 has surpassed that from all of fiscal 2020. This engineering revenue, which is derived from work performed on pipeline projects for our customers, has the potential to be a leading indicator of our future long-term production revenue. I believe the strategy we laid out to make investments in Sales & Marketing, Engineering and overall corporate operational infrastructure in order to identify, capture, and execute on additional pipeline opportunities, is progressing nicely. We have a number of projects in what we believe are the final stage of pre-commercialization, and a pipeline that is larger than at any point in our company's recent history. All told, while there are still challenges to be overcome relating to the impacts from COVID-19, I am pleased with the progress being made in the business to position us well for both the near- and long-term."

The following table summarizes the second quarter (unaudited) results for the periods ended December 31, 2020 and 2019:

		Three Months Ended Dec 31,
		2020	2019
Revenues		$  2,785,450	$  2,796,762
Gross Profit		854,440	917,939
Stock Compensation Expenses		145,846	263,473
Other		921,319	1,206,064
Total Operating Expenses		1,067,165	1,469,537
Operating Income (Loss)		(212,725)	(551,598)
Net Income (Loss)		(213,454)	(550,825)
Income (Loss) per Share		$          (0.02)	$          (0.04)
	Basic and Diluted
Weighted Average Common Shares Outstanding
	Basic and Diluted	13,191,789	12,873,971

Conference Call Details
The Company has scheduled a conference call to discuss the second quarter 2021 financial results for Tuesday, February 16, 2021 at 5:00 p.m. ET.

Call-in Information: Interested parties can access the conference call by dialing (844) 735-3662 or (412) 317-5705.

Live Webcast Information: Interested parties can access the conference call via a live Internet webcast, which is available at https://www.webcaster4.com/Webcast/Page/2109/39473. 

Replay: A teleconference replay of the call will be available until February 23, 2021 at (877) 344-7529 or (412) 317-0088, confirmation # 10151225. A webcast replay will be available at https://www.webcaster4.com/Webcast/Page/2109/39473.  

About Precision Optics Corporation
Precision Optics Corporation has been a leading developer and manufacturer of advanced optical instruments since 1982. Using proprietary optical technologies, the Company designs and produces next generation medical instruments, Microprecision™ micro-optics with characteristic dimensions less than 1 millimeter, and other advanced optical systems for a broad range of customers including some of the largest global medical device companies. The Company's innovative medical instrumentation line includes state-of-the-art endoscopes and endocouplers as well as custom illumination and imaging products for use in minimally invasive surgical procedures. The Company believes that current advances in its proprietary micro-optics and 3D imaging technologies present significant opportunities for expanding applications to numerous potential medical products and procedures. The Company's website is www.poci.com. Investors can find Real-Time Quotes and market information for the Company on www.otcmarkets.com/stock/PEYE/quote.

About Forward-Looking Statements
This press release contains forward-looking statements. Forward-looking statements include, but are not limited to, statements that express the Company's intentions, beliefs, expectations, strategies, predictions or any other statements related to the Company's future activities or future events or conditions. These statements are based on current expectations, estimates and projections about the Company's business based, in part, on assumptions made by the Company's management. These statements are not guarantees of future performances and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including those risks discussed in the Company's annual report on Form 10-K and in other documents that we file from time to time with the SEC. Any forward-looking statements speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement, except as required by law.

Company Contact:  
PRECISION OPTICS CORPORATION
22 East Broadway
Gardner, Massachusetts 01440-3338
Telephone: 978-630-1800

Investor Contact:
LYTHAM PARTNERS, LLC
Robert Blum
Phoenix | New York
Telephone: 602-889-9700
peye@lythampartners.com

Following are the Company's Consolidated Balance Sheets at December 31, 2020 and June 30, 2020, and Statements of Operations, for the three and six month periods ended December 31, 2020 and 2019:

PRECISION OPTICS CORPORATION, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
		December 31, 2020				June 30, 2020
ASSETS
Current Assets:
Cash and cash equivalents		$	816,263			$	1,134,697
Accounts receivable (net of allowance for doubtful accounts of $249,883 at December 31, 2020 and $248,450 at June 30, 2020)			1,590,867				1,481,437
Inventories			1,945,066				2,197,244
Prepaid expenses			146,619				133,707
Total current assets			4,498,815				4,947,085
Fixed Assets:
Machinery and equipment			2,915,847				2,907,533
Leasehold improvements			759,281				731,801
Furniture and fixtures			178,640				178,640
			3,853,768				3,817,974
Less—Accumulated depreciation and amortization			3,385,552				3,314,824
Net fixed assets			468,216				503,150
Operating lease right-to-use asset			90,181				118,403
Patents, net			118,468				95,229
Goodwill			687,664				687,664
TOTAL ASSETS		$	5,863,344			$	6,351,531
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of capital lease obligation		$	14,293			$	51,761
Current portion of acquisition earn out liability			166,667				166,667
Note payable to bank			808,962				808,962
Accounts payable			997,125				1,066,005
Customer advances			151,877				417,059
Accrued compensation and other			482,264				581,770
Current portion of operating lease liability			59,127				57,156
Total current liabilities			2,680,315				3,149,380
Capital lease obligation, net of current portion			31,317				35,810
Acquisition earn out liability			333,333				333,333
Operating lease liability, net of current portion			31,054				61,247
Stockholders' Equity:
Common stock, $0.01 par value: 50,000,000 shares authorized; issued and outstanding – 13,191,789 shares at December 31, 2020 and June 30, 2020			131,918				131,918
Additional paid-in capital			49,931,211				49,702,986
Accumulated deficit			(47,275,804)				(47,063,143)
Total stockholders' equity			2,787,325				2,771,761
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	5,863,344			$	6,351,531

 

PRECISION OPTICS CORPORATION, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED
DECEMBER 31, 2020 AND 2019
(UNAUDITED)
		Three Months Ended December 31,								Six Months Ended December 31,
		2020				2019				2020				2019
Revenues		$	2,785,450			$	2,796,762			$	5,543,351			$	5,311,746
Cost of Goods Sold			1,931,010				1,878,823				3,713,733				3,419,690
Gross Profit			854,440				917,939				1,829,618				1,892,056
Research and Development Expenses, net			145,970				228,576				297,546				380,730
Selling, General and Administrative Expenses			921,195				1,240,961				1,743,197				2,148,806
Total Operating Expenses			1,067,165				1,469,537				2,040,743				2,529,536
Operating Loss			(212,725)				(551,598)				(211,125)				(637,480)
Interest (Expense) Income			(729)				773				(1,536)				545
Net Loss		$	(213,454)			$	(550,825)			$	(212,661)			$	(636,935)
Loss Per Share:
Basic and Fully Diluted		$	(0.02)			$	(0.04)			$	(0.02)			$	(0.05)
Weighted Average Common Shares Outstanding:
Basic and Fully Diluted			13,191,789				12,873,971				13,191,789				12,856,218

 

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SOURCE Precision Optics Corporation

FAQ

What were the revenue figures for Precision Optics Corporation in the second quarter of fiscal 2021?

In the second quarter of fiscal 2021, Precision Optics Corporation reported revenue of $2.79 million, nearly flat compared to $2.80 million in the same quarter last year.

How did Precision Optics Corporation's gross margins change in the second quarter of fiscal 2021?

Gross margins for the second quarter of fiscal 2021 were 31%, down from 33% in the same quarter of the previous year.

What was the net loss reported by Precision Optics Corporation in Q2 fiscal 2021?

Precision Optics Corporation reported a net loss of $213,000 in the second quarter of fiscal 2021, an improvement from a loss of $551,000 in the same quarter the previous year.

What is the engineering revenue trend for Precision Optics Corporation?

Engineering revenue for the first six months of fiscal 2021 has surpassed that of all of fiscal 2020.