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eMagin Corporation Announces First Quarter 2018 Financial Results
- Posts 13% Revenue Growth in Q1; 20% Increase in Backlog from Year End -
“We had a strong start to the year for our commercial initiatives as
well as our military programs,” said
“We are seeing broader, accelerating interest within the consumer AR/VR market. New opportunities continue to surface for our high brightness, direct patterned OLED microdisplays. Consistently, we hear from prospects in the consumer segment that our cutting-edge technology is a key enabler for next generation HMD products,” continued Mr. Sculley. “I am happy to say that the design of our next generation display is on track and going well. We look forward to having prototypes available for customers by year end 2018 or early 2019.
“As we work with our prospective manufacturing partners and our consumer electronics OEMs, our focus remains on identifying the optimal business structure to scale our direct patterning (dPdtm) technology and best capitalize on the consumer AR/VR market opportunity. This will enable us to achieve the broadest application of our dPd technology in the marketplace.
“Our military business continues to grow, and we saw increased bookings
from our U.S. programs as well as from foreign military customers. At
“We are continuing to make progress in our development of very high brightness full-color microdisplays incorporating our dPd technology. To this end, we are designing further improvements to lengthen the lifetime of our microdisplays and incorporating enhancements to our equipment to improve our production yields and expand our manufacturing capacity.
“The response to our micro displays has been overwhelmingly positive. Demand for our products remains strong both domestically and internationally. This is leading to more orders and requests for accelerated deliveries across the board,” concluded Mr. Sculley.
Business and Product Highlights
- We are continuing to optimize our dPd technology and having previously demonstrated maximum brightness of more than 5,300 nits, we have recently achieved greater than 7000 nits while reducing power consumption by 20%.
- We are advancing discussions with multiple consumer electronics partner prospects regarding eMagin’s next generation microdisplays for AR/VR applications. Additionally, we received an inquiry from two additional prospective Tier 1 customers about designing and developing displays.
- We expanded discussions on mass production for the commercial market and included an additional potential partner in those discussions.
- We accelerated shipments for multiple international customers as business activity increases.
We are expanding our business development initiatives internationally
and pursuing new markets in
Asiawhere we have not been as active. In April we participated in the DefExpo 18 India trade show where our microdisplays received strong interest from defense and commercial customers in the rapidly growing Indian market.
- We are on schedule with the OLED upgrade to a production helmet for a multi-service, multi-country, fixed wing aircraft program. Additional displays for pre-production testing will be delivered in the second quarter with deliveries of displays for flight testing expected in the fourth quarter. We are receiving positive feedback on the performance of this OLED helmet during qualification and flight testing.
Revenues for the first quarter of 2018 grew 13% to
Product revenues increased 34% to
Overall gross margin for the first quarter was 29% on gross profit of
Operating expenses for the first quarter of 2018, including R&D
Operating loss for the first quarter was
Conference Call Information
A conference call and live webcast will begin today at
A leader in OLED microdisplay technology, OLED microdisplay manufacturing know-how and mobile display systems, eMagin manufactures high-resolution OLED microdisplays and integrates them with magnifying optics to deliver virtual images comparable to large-screen computer and television displays in portable, low-power, lightweight personal displays. eMagin’s microdisplays provide near-eye imagery in a variety of products from military, industrial, medical and consumer OEMs. More information about eMagin is available at www.emagin.com.
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934, including those regarding eMagin
Corporation’s expectations, intentions, strategies and beliefs
pertaining to future events or future financial performance. Actual
events or results may differ materially from those in the
forward-looking statements as a result of various important factors,
including those described in the Company’s most recent filings with the
Non-GAAP Financial Measures
To supplement the Company’s consolidated financial statements presented on a GAAP basis, the Company has provided non-GAAP financial information, namely earnings before interest, taxes, depreciation and amortization, and non-cash compensation expense (“Adjusted EBITDA”). The Company’s management believes that this non-GAAP measure provides investors with a better understanding of how the results relate to the Company’s historical performance. The additional adjusted information is not meant to be considered in isolation or as a substitute for GAAP financial statements. Management believes that these adjusted measures reflect the essential operating activities of the Company. A reconciliation of non-GAAP financial information appears below.
|CONSOLIDATED BALANCE SHEETS|
|(in thousands, except share and per share data)|
|March 31,||December 31,|
|Cash and cash equivalents||$||9,802||$||3,526|
|Accounts receivable, net||4,138||4,528|
|Unbilled accounts receivable||526||406|
|Prepaid expenses and other current assets||1,115||1,328|
|Total current assets||24,528||18,428|
|Equipment, furniture and leasehold improvements, net||8,150||8,553|
|Intangibles and other assets||363||326|
|LIABILITIES AND SHAREHOLDERS’ EQUITY|
|Revolving credit facility, net||—||3,808|
|Common stock warrant liability||3,187||784|
|Other accrued expenses||1,134||719|
|Other current liabilities||365||469|
|Total current liabilities||8,042||9,816|
|Commitments and contingencies (Note 9)|
|Preferred stock, $.001 par value: authorized 10,000,000 shares:|
Series B Convertible Preferred stock, (liquidation preference of
Common stock, $.001 par value: authorized 200,000,000 shares,
|Additional paid-in capital||254,304||244,726|
|Treasury stock, 162,066 shares as of March 31, 2018 and December 31, 2017||(500||)||(500||)|
|Total shareholders’ equity||24,999||17,491|
|Total liabilities and shareholders’ equity||$||33,041||$||27,307|
|CONSOLIDATED STATEMENTS OF OPERATIONS|
|(in thousands, except share and per share data)|
|Three Months Ended|
|Total revenues, net||6,867||6,069|
|Cost of revenues:|
|Total cost of revenues||4,887||4,251|
|Research and development||1,631||1,334|
|Selling, general and administrative||2,912||2,463|
|Total operating expenses||4,543||3,797|
|Loss from operations||(2,563||)||(1,979||)|
|Other income (expense):|
|Change in fair value of common stock warrant liability||503||—|
|Interest expense, net||(42||)||(35||)|
|Other income, net||21||15|
|Total other income||482||(20||)|
|Loss before provision for income taxes||(2,081||)||(1,999||)|
|(Provision) benefit for income taxes||—||—|
|Loss per share, basic||$||(0.05||)||$||(0.06||)|
|Loss per share, diluted||$||(0.05||)||$||(0.06||)|
|Weighted average number of shares outstanding:|
|Three Months Ended|
|Net income (loss)||$||(2,081||)||$||(1,999||)|
|Change in fair value of common stock warrant liability||(503||)||-|
|Depreciation and intangibles amortization expense||468||486|
|Provision for income taxes||-||-|