- Fifth consecutive quarter of year-over-year, double-digit revenue growth
- Total revenues of
$13.5 million for the three months endedDecember 31, 2018 , up 37% compared to the three months endedDecember 31, 2017 ; total revenues of$42.9 million for fiscal year 2018, an increase of 30% compared to fiscal 2017 - Pre-tax income from continuing operations improved to
$0.6 million for the three months endedDecember 31, 2018 , compared to a loss of$(0.5) million for the prior-year fourth quarter; for fiscal 2018, pre-tax income from continuing operations increased to$1.3 million compared to a pre-tax loss from continuing operations of$(2.4) million in fiscal 2017 - Net income attributable to common stockholders improved to
$0.9 million for the three months endedDecember 31, 2018 , compared to$0.4 million for the prior-year fourth quarter; for fiscal 2018, income attributable to common stockholders declined to$10.7 million from$14.5 million in fiscal 2017, primarily due to the smaller gain recognized on the sale of discontinued operations in 2018 compared to 2017. - Adjusted EBITDA of
$1.6 million for the three months endedDecember 31, 2018 and$3.0 million for fiscal year 2018, and a gross margin improvement of 5 basis points for the full year
“This has been an extraordinary year for Luna, and I’m extremely pleased
with our performance in the fourth quarter and for this fiscal year,”
said
Graeff continued, “As prudent stewards of capital, we believe that the acquisition of General Photonics, a leader in characterization and control of light for photonics applications, will only continue to drive Luna’s growth. This acquisition, and the acquisition of Micron Optics completed last year, spotlight Luna’s ability to acquire assets that fit squarely within our core while delivering an excellent return on invested capital.”
Fourth-Quarter and Full-Year Fiscal 2018 Financial Summary
Total revenues for the three months ended
Gross profit was
Selling, general and administrative ("SG&A") expenses were
Pre-tax income from continuing operations improved to
Net income attributable to common stockholders for the three months
ended
Adjusted EBITDA was
For the full year fiscal 2018, Luna reported total revenues of
Pre-tax income from continuing operations improved to$1.3 million for
fiscal 2018 compared to a pre-tax loss from continuing operations of
Net income attributable to common stockholders was
2019 Full Year Outlook:
Luna expects:
-
Total revenues in the range of
$60 million to $65 million for full fiscal 2019; and -
Adjusted EBITDA in the range of
$6.0 million to $6.5 million for full fiscal 2019.
Luna is not providing outlook for net income, which is the most directly comparable GAAP measure to adjusted EBITDA, because changes in the items that Luna excludes from net income to calculate adjusted EBITDA, including items such as share-based compensation, amortization of acquired intangible assets, tax expense, and significant non-recurring charges, among other things, can be dependent on future events that are less capable of being controlled or reliably predicted by management and are not part of Luna's routine operating activities.
The outlook above includes the expected operating results from Luna's
acquisition of
Non-GAAP Financial 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 its growth potential and the impact of its acquisitions of MOI
and General Photonics on future growth, its projected 2019 financial
results, and its business focus. 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, failure of target
market to grow and expand, technological and strategic challenges and
those risks and uncertainties set forth in Luna’s Form 10-Q for the
quarter ended
Luna Innovations Incorporated
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Three months ended December 31, | Year ended December 31, | ||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | ||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Technology development revenues | $ | 5,548,639 | $ | 5,147,954 | $ | 20,967,556 | $ | 18,576,383 | ||||||||||||||||
Products and licensing revenues | 7,989,686 | 4,714,269 | 21,949,689 | 14,505,482 | ||||||||||||||||||||
Total revenues | 13,538,325 | 9,862,223 | 42,917,245 | 33,081,865 | ||||||||||||||||||||
Cost of revenues: | ||||||||||||||||||||||||
Technology development costs | 4,268,509 | 3,943,118 | 15,400,475 | 13,988,378 | ||||||||||||||||||||
Products and licensing costs | 2,697,538 | 1,731,643 | 8,078,870 | 5,724,457 | ||||||||||||||||||||
Total cost of revenues | 6,966,047 | 5,674,761 | 23,479,345 | 19,712,835 | ||||||||||||||||||||
Gross profit | 6,572,278 | 4,187,462 | 19,437,900 | 13,369,030 | ||||||||||||||||||||
Operating expense: | ||||||||||||||||||||||||
Selling, general and administrative | 4,896,136 | 3,943,520 | 14,794,205 | 12,923,841 | ||||||||||||||||||||
Research, development and engineering | 1,252,663 | 691,566 | 3,766,160 | 2,653,337 | ||||||||||||||||||||
Total operating expense | 6,148,799 | 4,635,086 | 18,560,365 | 15,577,178 | ||||||||||||||||||||
Operating income/(loss) | 423,479 | (447,624 | ) | 877,535 | (2,208,148 | ) | ||||||||||||||||||
Other expense: | ||||||||||||||||||||||||
Other (expense)/income, net | (1,070 | ) | 114 | (17,143 | ) | 26,106 | ||||||||||||||||||
Investment income | 198,525 | — |
|
549,580 | — |
|
||||||||||||||||||
Interest expense, net | (21,136 | ) | (38,474 | ) | (124,344 | ) | (217,352 | ) | ||||||||||||||||
Total other income/(expense) | 176,319 | (38,360 | ) | 408,093 | (191,246 | ) | ||||||||||||||||||
Income/(loss) from continuing operations before income taxes | 599,798 | (485,984 | ) | 1,285,628 | (2,399,394 | ) | ||||||||||||||||||
Income tax expense/(benefit) | 722,148 | (486,530 | ) | 47,818 | (1,148,579 | ) | ||||||||||||||||||
(Loss)/Income from continuing operations | (122,350 | ) | 546 | 1,237,810 | (1,250,815 | ) | ||||||||||||||||||
Income from discontinued operations, net of income taxes | 1,062,186 | 434,783 | 9,766,431 | 15,865,720 | ||||||||||||||||||||
Net income | 939,836 | 435,329 | 11,004,241 | 14,614,905 | ||||||||||||||||||||
Preferred stock dividend | 66,407 | 49,558 | 257,302 | 146,889 | ||||||||||||||||||||
Net income attributable to common stockholders | $ | 873,429 | $ | 385,771 | $ | 10,746,939 | $ | 14,468,016 | ||||||||||||||||
Net income/(loss) per share from continuing operations: | ||||||||||||||||||||||||
Basic | $ | — | $ | — | $ | 0.04 | $ | (0.05 | ) | |||||||||||||||
Diluted |
$ | — | $ | — | $ | 0.04 | $ | (0.05 | ) | |||||||||||||||
Net income per share from discontinued operations: | ||||||||||||||||||||||||
Basic | $ | 0.04 | $ | 0.01 | $ | 0.35 | $ | 0.58 | ||||||||||||||||
Diluted | $ | 0.04 | $ | 0.01 | $ | 0.30 | $ | 0.58 | ||||||||||||||||
Net income per share attributable to common stockholders: | ||||||||||||||||||||||||
Basic | $ | 0.03 | $ | 0.01 | $ | 0.39 | $ | 0.52 | ||||||||||||||||
Diluted | $ | 0.03 | $ | 0.01 | $ | 0.33 | $ | 0.52 | ||||||||||||||||
Weighted average shares: | ||||||||||||||||||||||||
Basic | 28,067,348 | 27,485,278 | 27,596,401 | 27,579,988 | ||||||||||||||||||||
Diluted | 28,067,348 | 31,790,418 | 32,452,228 | 27,579,988 | ||||||||||||||||||||
Luna Innovations Incorporated |
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December 31, |
December 31, |
|||||||||||
(unaudited) | ||||||||||||
Assets | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 42,460,267 | $ | 36,981,533 | ||||||||
Accounts receivable, net | 13,037,068 | 5,929,042 | ||||||||||
Receivable from sale of HSOR business | 2,500,000 | 4,000,976 | ||||||||||
Contract assets | 2,422,495 | 1,778,142 | ||||||||||
Inventory, net | 6,873,742 | 4,634,781 | ||||||||||
Prepaid expenses | 935,185 | 1,140,999 | ||||||||||
Current assets held for sale | — | 4,336,105 | ||||||||||
Total current assets | 68,228,757 | 58,801,578 | ||||||||||
Property and equipment, net | 3,627,886 | 2,854,641 | ||||||||||
Intangible assets, net | 3,302,270 | 1,727,390 | ||||||||||
Goodwill | 101,008 | — | ||||||||||
Long term contract assets | 336,820 | 209,699 | ||||||||||
Other assets | 1,995 | 1,995 | ||||||||||
Non-current assets held for sale | — | 2,627,333 | ||||||||||
Total assets | $ | 75,598,736 | $ | 66,222,636 | ||||||||
Liabilities and stockholders’ equity | ||||||||||||
Current liabilities: | ||||||||||||
Current portion of long term debt obligation | $ | 619,315 | $ | 1,833,333 | ||||||||
Current portion of capital lease obligation | 40,586 | 43,665 | ||||||||||
Accounts payable | 2,395,984 | 2,111,077 | ||||||||||
Accrued liabilities | 6,597,458 | 6,547,230 | ||||||||||
Contract liabilities | 2,486,111 | 3,318,379 | ||||||||||
Current liabilities held for sale | — | 972,451 | ||||||||||
Total current liabilities | 12,139,454 | 14,826,135 | ||||||||||
Long-term deferred rent | 1,035,974 | 1,184,438 | ||||||||||
Long-term debt obligation | — | 603,007 | ||||||||||
Long-term capital lease obligation | 68,978 | 71,275 | ||||||||||
Total liabilities | 13,244,406 | 16,684,855 | ||||||||||
Commitments and contingencies | ||||||||||||
Stockholders’ equity: | ||||||||||||
Preferred stock, par value $0.001, 1,321,514 shares authorized, issued and outstanding at December 31, 2018 and 2017 | 1,322 | 1,322 | ||||||||||
Common stock, par value $0.001, 100,000,000 shares authorized, 29,209,506 and 28,354,822 shares issued, 27,956,401 and 27,283,918 shares outstanding at December 31, 2018 and 2017, respectively | 30,120 | 29,186 | ||||||||||
Treasury stock at cost, 1,253,105 and 1,070,904 shares at December 31, 2018 and 2017, respectively | (2,116,640 | ) | (1,649,746 | ) | ||||||||
Additional paid-in capital | 85,744,750 | 83,563,208 | ||||||||||
Accumulated deficit | (21,305,222 | ) | (32,406,189 | ) | ||||||||
Total stockholders’ equity | 62,354,330 | 49,537,781 | ||||||||||
Total liabilities and stockholders’ equity | $ | 75,598,736 | $ | 66,222,636 | ||||||||
Luna Innovations Incorporated |
||||||||||||
Year ended December 31, | ||||||||||||
2018 | 2017 | |||||||||||
(unaudited) | ||||||||||||
Cash flows (used in)/provided by operating activities: | ||||||||||||
Net income | $ | 11,004,241 | $ | 14,614,905 | ||||||||
Adjustments to reconcile net income to net cash (used in)/provided by operating activities: | ||||||||||||
Depreciation and amortization | 1,095,418 | 2,526,609 | ||||||||||
Stock-based compensation | 527,189 | 715,094 | ||||||||||
(Gain)/loss on disposal of fixed assets | (1,000 | ) | 3,640 | |||||||||
Gain on sale of discontinued operations, net of income taxes | (8,595,798 | ) | (15,671,028 | ) | ||||||||
Bad debt | 6,000 | 99,888 | ||||||||||
Changes in operating assets and liabilities: | ||||||||||||
Accounts receivable | (6,240,377 | ) | 1,152,055 | |||||||||
Contract assets | (761,714 | ) | — | |||||||||
Inventory | (967,797 | ) | (1,902,311 | ) | ||||||||
Prepaid expenses | 1,849,630 | 83,428 | ||||||||||
Accounts payable and accrued expenses | (661,928 | ) | (896,534 | ) | ||||||||
Contract liabilities | (986,498 | ) | — | |||||||||
Deferred credits | — | 189,296 | ||||||||||
Net cash (used in)/provided by operating activities | (3,732,634 | ) | 915,042 | |||||||||
Cash flows provided by investing activities: | ||||||||||||
Acquisition of property and equipment | (329,249 | ) | (1,352,531 | ) | ||||||||
Proceeds from sale of property and equipment | 1,000 | 3,000 | ||||||||||
Intangible property costs | (309,266 | ) | (495,597 | ) | ||||||||
Acquisition of Micron Optics | (5,001,750 | ) | — | |||||||||
Proceeds from sale of discontinued operations, net | 15,799,529 | 28,026,528 | ||||||||||
Net cash provided by investing activities | 10,160,264 | 26,181,400 | ||||||||||
Cash flows used in financing activities: | ||||||||||||
Payments on debt obligations | (1,833,333 | ) | (1,833,333 | ) | ||||||||
Payments on capital lease obligation | (46,653 | ) | (52,128 | ) | ||||||||
Purchase of treasury stock | (466,894 | ) | (1,131,759 | ) | ||||||||
Proceeds from the exercise of options | 1,397,984 | 99,853 | ||||||||||
Net cash used in financing activities | (948,896 | ) | (2,917,367 | ) | ||||||||
Net change in cash and cash equivalents | 5,478,734 | 24,179,075 | ||||||||||
Cash and cash equivalents—beginning of period | 36,981,533 | 12,802,458 | ||||||||||
Cash and cash equivalents—end of period | $ | 42,460,267 | $ | 36,981,533 | ||||||||
Luna Innovations Incorporated |
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|
Three months ended December 31, |
Year ended December 31, |
||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||||||||
Net income | $ | 939,836 | 435,329 | $ | 11,004,241 | $ | 14,614,905 | |||||||||||||||||
Less income from discontinued operations, net of income taxes | 1,062,186 | 434,783 | 9,766,431 | 15,865,720 | ||||||||||||||||||||
Net (loss)/income from continuing operations | (122,350 | ) | 546 | 1,237,810 | (1,250,815 | ) | ||||||||||||||||||
Income tax expense/(benefit) | 722,148 | (486,530 | ) | 47,818 | (1,148,579 | ) | ||||||||||||||||||
Income/(loss) from continuing operations before income taxes | 599,798 | (485,984 | ) | 1,285,628 | (2,399,394 | ) | ||||||||||||||||||
Investment income | (198,525 | ) | — | (549,580 | ) | — | ||||||||||||||||||
Interest expense | 21,136 | 38,474 | 124,344 | 217,352 | ||||||||||||||||||||
Depreciation and amortization | 197,203 | 311,565 | 908,347 | 1,136,729 | ||||||||||||||||||||
EBITDA | 619,612 | (135,945 | ) | 1,768,739 | (1,045,313 | ) | ||||||||||||||||||
Share-based compensation | 181,607 | 194,861 | 527,189 | 715,094 | ||||||||||||||||||||
Non-recurring charges | 751,102 | 595,992 | 751,102 | 595,992 | ||||||||||||||||||||
Adjusted EBITDA | $ | 1,552,321 | $ | 654,908 | $ | 3,047,030 | $ | 265,773 | ||||||||||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20190304005416/en/
Source:
Investor Contacts:
Jane Bomba
Phone: 303-829-1211
Email:
[email protected]
Sally
J. Curley
Luna Innovations Incorporated
Phone: 614-530-3002
Email:
[email protected]