- Fourth consecutive quarter of year-over-year, double-digit revenue growth
- Total revenues of
$10.7 million for the three months endedSeptember 30, 2018 , up 29% compared to the three months endedSeptember 30, 2017 - Net income from continuing operations improved significantly to
$1.3 million for the three months endedSeptember 30, 2018 , compared to$0.2 million for the prior year fiscal quarter
“Our third quarter represents the fourth consecutive quarter of
double-digit top-line growth. We posted strong operating income, net
income and adjusted EBITDA growth as well, and I’m extremely pleased
with and proud of the way our teams are executing,” said
Graeff continued, “We are committed to being prudent stewards of
capital. Our most recent acquisition of Micron Optics, a leading
provider of innovative optical components and laser-based measurement
technology for approximately
Third-Quarter and Nine Month Financial Summary
Total revenues for the three months ended
Gross profit was
Selling, general and administrative ("SG&A") expenses were
Net income from continuing operations improved to
Net income attributable to common stockholders for the three months
ended
For the first nine months of fiscal 2018, Luna reported net income
attributable to common stockholders of
2018 Fourth-Quarter and Year End Outlook (forward-looking statement):
Luna expects:
-
Revenue in the range of
$12 million to $12.5 million for the fourth quarter of fiscal 2018; -
Revenue in the range of
$41.5 million to $42 million for full fiscal 2018; -
Net income per diluted share attributable to common stockholders of
breakeven to
$0.01 for the fourth quarter of fiscal 2018; and -
Net income per diluted share attributable to common stockholders in a
range of
$0.31 to $0.32 for full fiscal 2018.
The outlook above includes the expected operating results from Luna's
acquisition 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
Luna will host a conference call today 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, its projected financial results for the
fourth quarter of fiscal 2018 and the full year ended
Luna Innovations Incorporated | |||||||||||||||||
Consolidated Statements of Operations | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||||
Revenues: | |||||||||||||||||
Technology development | $ | 5,315,861 | $ | 4,590,054 | $ | 15,418,919 | $ | 13,428,428 | |||||||||
Products and licensing | 5,371,165 | 3,712,657 | 13,960,003 | 9,791,213 | |||||||||||||
Total revenues | 10,687,026 | 8,302,711 | 29,378,922 | 23,219,641 | |||||||||||||
Cost of revenues: | |||||||||||||||||
Technology development | 3,918,666 | 3,491,840 | 11,131,965 | 10,045,261 | |||||||||||||
Products and licensing | 2,079,749 | 1,469,961 | 5,381,333 | 3,994,044 | |||||||||||||
Total cost of revenues | 5,998,415 | 4,961,801 | 16,513,298 | 14,039,305 | |||||||||||||
Gross profit | 4,688,611 | 3,340,910 | 12,865,624 | 9,180,336 | |||||||||||||
Operating expense: | |||||||||||||||||
Selling, general and administrative | 3,233,485 | 2,831,493 | 9,898,064 | 8,983,016 | |||||||||||||
Research, development and engineering | 873,629 | 662,142 | 2,513,497 | 1,961,770 | |||||||||||||
Total operating expense | 4,107,114 | 3,493,635 | 12,411,561 | 10,944,786 | |||||||||||||
Operating income/(loss) | 581,497 | (152,725 | ) | 454,063 | (1,764,450 | ) | |||||||||||
Other income/(expense): | |||||||||||||||||
Investment income | 171,896 | — | 350,976 | — | |||||||||||||
Other income/(expense) | 8,319 | 13,733 | (16,001 | ) | 26,286 | ||||||||||||
Interest expense | (28,029 | ) | (54,847 | ) | (103,208 | ) | (178,879 | ) | |||||||||
Total other income/(expense) | 152,186 | (41,114 | ) | 231,767 | (152,593 | ) | |||||||||||
Income/(loss) from continuing operations before income taxes | 733,683 | (193,839 | ) | 685,830 | (1,917,043 | ) | |||||||||||
Income tax benefit | (559,093 | ) | (388,787 | ) | (674,329 | ) | (662,049 | ) | |||||||||
Net income/(loss) from continuing operations | 1,292,776 | 194,948 | 1,360,159 | (1,254,994 | ) | ||||||||||||
Gain on sale, net of income taxes of $1,866,232 and $1,508,373 | 7,612,044 | 15,096,666 | 7,571,810 | 15,096,666 | |||||||||||||
(Loss)/income from discontinued operations, net of income tax of $216,813, $(91,705), $235,312, and $249,184 |
(56,418 | ) | 465,710 | 1,132,436 | 337,904 | ||||||||||||
Net income from discontinued operations | 7,555,626 | 15,562,376 | 8,704,246 | 15,434,570 | |||||||||||||
Net income | 8,848,402 | 15,757,324 | 10,064,405 | 14,179,576 | |||||||||||||
Preferred stock dividend | 63,235 | 33,699 | 190,895 | 97,331 | |||||||||||||
Net income attributable to common stockholders | $ | 8,785,167 | $ | 15,723,625 | $ | 9,873,510 | $ | 14,082,245 | |||||||||
Net income/(loss) per share from continuing operations: | |||||||||||||||||
Basic | $ | 0.05 | $ | 0.01 | $ | 0.05 | $ | (0.05 | ) | ||||||||
Diluted | $ | 0.04 | $ | 0.01 | $ | 0.04 | $ | (0.05 | ) | ||||||||
Net income per share from discontinued operations: | |||||||||||||||||
Basic | $ | 0.27 | $ | 0.56 | $ | 0.32 | $ | 0.56 | |||||||||
Diluted | $ | 0.23 | $ | 0.48 | $ | 0.27 | $ | 0.56 | |||||||||
Net income per share attributable to common stockholders: | |||||||||||||||||
Basic | $ | 0.31 | $ | 0.57 | $ | 0.36 | $ | 0.51 | |||||||||
Diluted | $ | 0.27 | $ | 0.48 | $ | 0.30 | $ | 0.51 | |||||||||
Weighted average common shares and common equivalent shares outstanding: | |||||||||||||||||
Basic | 27,901,631 | 27,692,539 | 27,547,955 | 27,611,905 | |||||||||||||
Diluted | 33,055,881 | 32,714,389 | 32,721,860 | 27,611,905 | |||||||||||||
Luna Innovations Incorporated | ||||||||
Consolidated Balance Sheets | ||||||||
September 30, | December 31, | |||||||
2018 | 2017 | |||||||
(unaudited) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 47,144,719 | $ | 36,981,533 | ||||
Accounts receivable, net | 9,110,713 | 5,929,042 | ||||||
Receivable from sale of HSOR business | 4,002,342 | 4,000,976 | ||||||
Contract assets | 2,611,122 | 1,778,142 | ||||||
Inventory | 5,462,414 | 4,634,781 | ||||||
Prepaid expenses and other current assets | 730,368 | 1,140,999 | ||||||
Current assets held for sale | — | 4,336,105 | ||||||
Total current assets | 69,061,678 | 58,801,578 | ||||||
Long-term contract assets | 343,492 | 209,699 | ||||||
Property and equipment, net | 2,678,411 | 2,854,641 | ||||||
Intangible assets, net | 1,709,003 | 1,727,390 | ||||||
Other assets | 1,995 | 1,995 | ||||||
Non-current assets held for sale | — | 2,627,333 | ||||||
Total assets | $ | 73,794,579 | $ | 66,222,636 | ||||
Liabilities and stockholders’ equity | ||||||||
Liabilities: | ||||||||
Current liabilities: | ||||||||
Current portion of long-term debt obligations | $ | 1,073,571 | $ | 1,833,333 | ||||
Current portion of capital lease obligations | 39,748 | 43,665 | ||||||
Accounts payable | 2,297,457 | 2,111,077 | ||||||
Accrued liabilities | 6,589,310 | 6,547,230 | ||||||
Contract liabilities | 1,548,371 | 3,318,379 | ||||||
Current liabilities held for sale | — | 972,451 | ||||||
Total current liabilities | 11,548,457 | 14,826,135 | ||||||
Long-term deferred rent | 1,072,696 | 1,184,438 | ||||||
Long-term debt obligations | — | 603,007 | ||||||
Long-term capital lease obligations | 83,405 | 71,275 | ||||||
Total liabilities | 12,704,558 | 16,684,855 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, par value $0.001, 1,321,514 shares authorized, issued and outstanding at September 30, 2018 and December 31, 2017 | 1,322 | 1,322 | ||||||
Common stock, par value $0.001, 100,000,000 shares authorized, 29,189,506 and 28,354,822 shares issued, 27,936,401 and 27,283,918 shares outstanding at September 30, 2018 and December 31, 2017 | 30,081 | 29,186 | ||||||
Treasury stock at cost, 1,253,105 and 1,070,904 shares at September 30, 2018 and December 31, 2017 | (2,116,640 | ) | (1,649,746 | ) | ||||
Additional paid-in capital | 85,353,909 | 83,563,208 | ||||||
Accumulated deficit | (22,178,651 | ) | (32,406,189 | ) | ||||
Total stockholders’ equity | 61,090,021 | 49,537,781 | ||||||
Total liabilities and stockholders’ equity | $ | 73,794,579 | $ | 66,222,636 | ||||
Luna Innovations Incorporated | ||||||||
Consolidated Statements of Cash Flows | ||||||||
Nine Months Ended September 30, | ||||||||
2018 | 2017 | |||||||
(unaudited) | ||||||||
Cash flows (used in)/ provided by operating activities | ||||||||
Net income | $ | 10,064,405 | $ | 14,179,576 | ||||
Adjustments to reconcile net income to net cash (used in)/provided by operating activities | ||||||||
Depreciation and amortization | 898,215 | 2,241,867 | ||||||
Share-based compensation | 345,582 | 476,428 | ||||||
Bad debt expense | 6,000 | 40,753 | ||||||
(Gain)/loss on disposal of fixed assets | (1,000 | ) | 3,640 | |||||
Gain on sale of discontinued operations, net of tax | (7,571,810 | ) | (15,096,666 | ) | ||||
Tax benefit from utilization of net operating loss | ||||||||
Change in assets and liabilities | ||||||||
Accounts receivable | (4,056,716 | ) | 2,127,794 | |||||
Contract assets | (957,012 | ) | — | |||||
Inventory | (992,075 | ) | (2,251,236 | ) | ||||
Other current assets | 482,155 | 380,858 | ||||||
Accounts payable and accrued expenses | 243,965 | (1,581,608 | ) | |||||
Contract liabilities | (1,906,117 | ) | — | |||||
Deferred revenue | — | 59,980 | ||||||
Net cash (used in)/provided by operating activities | (3,444,408 | ) | 581,386 | |||||
Cash flows provided by investing activities | ||||||||
Acquisition of property and equipment | (272,039 | ) | (893,698 | ) | ||||
Intangible property costs | (277,068 | ) | (392,485 | ) | ||||
Proceeds from sale of property and equipment | 1,000 | 3,000 | ||||||
Proceeds from sales of discontinued operations | 14,775,541 | 28,026,528 | ||||||
Net cash provided by investing activities | 14,227,434 | 26,743,345 | ||||||
Cash flows used in financing activities | ||||||||
Payments on capital lease obligations | (33,064 | ) | (38,753 | ) | ||||
Payments of debt obligations | (1,375,000 | ) | (1,374,999 | ) | ||||
Repurchase of common stock | (466,894 | ) | (228,020 | ) | ||||
Proceeds from the exercise of options and warrants | 1,255,118 | 29,020 | ||||||
Net cash used in financing activities | (619,840 | ) | (1,612,752 | ) | ||||
Net increase in cash or cash equivalents | 10,163,186 | 25,711,979 | ||||||
Cash and cash equivalents-beginning of period | 36,981,533 | 12,802,458 | ||||||
Cash and cash equivalents-end of period | $ | 47,144,719 | $ | 38,514,437 | ||||
Luna Innovations Incorporated | ||||||||||||||||
Reconciliation of Net Income to EBITDA and Adjusted EBITDA | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
(unaudited) | (unaudited) | |||||||||||||||
Net income | $ | 8,848,402 | $ | 15,757,324 | $ | 10,064,405 | $ | 14,179,576 | ||||||||
Less income from discontinued operations, net of income taxes | 7,555,626 | 15,562,376 | 8,704,246 | 15,434,570 | ||||||||||||
Net income/(loss) from continuing operations | 1,292,776 | 194,948 | 1,360,159 | (1,254,994 | ) | |||||||||||
Interest expense | 28,029 | 54,847 | 103,208 | 178,879 | ||||||||||||
Investment income | (171,896 | ) | — | (350,976 | ) | — | ||||||||||
Tax benefit | (559,093 | ) | (388,787 | ) | (674,329 | ) | (662,049 | ) | ||||||||
Depreciation and amortization | 238,002 | 208,958 | 711,144 | 644,001 | ||||||||||||
EBITDA | 827,818 | 69,966 | 1,149,206 | (1,094,163 | ) | |||||||||||
Share-based compensation | 117,823 | 151,672 | 345,582 | 476,428 | ||||||||||||
Adjusted EBITDA | $ | 945,641 | $ | 221,638 | $ | 1,494,788 | $ | (617,735 | ) | |||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20181108005406/en/
Source:
Investors:
Jane Bomba
Luna Innovations Incorporated
Phone:
303-829-1211
[email protected]
or
Sally
J. Curley
Luna Innovations Incorporated
614-530-3002
[email protected]