Company posts net income of
Following the sale of its fiber optic shape sensing technology for
medical applications in the first quarter of 2014, Luna reported a net
income attributable to common stockholders of
Total revenue increased by 9% from
The company reported a loss from continuing operations of
“With the sale of the medical shape sensing business in the first
quarter, we significantly improved our liquidity, allowing us to focus
on our key growth initiative of fiber optic sensing for strain and
temperature,” said
First Quarter Financial and Business Summary
-
Total revenue increased by 9% to
$4.5 million for the first quarter of 2014 from$4.1 million in the first quarter of 2013. -
Technology development revenue increased by 2% to
$2.7 million for the first quarter of 2014 from$2.6 million for the first quarter of 2013. -
Products and licensing revenue increased by 22% to
$1.8 million for the first quarter of 2014 from$1.5 million in the first quarter of 2013. -
Gross profit for the first quarter of 2014 increased to
$1.6 million , or 35% of total revenue, from$1.1 million , or 28% of total revenue, for the first quarter of 2013. -
Selling, general and administrative expenses increased by 3% to
$2.8 million , or 62% of total revenue, for the first quarter of 2014, from$2.7 million , or 65% of total revenue, for the first quarter of 2013. -
Total operating expenses increased to
$3.5 million , or 78% of total revenue, for the first quarter of 2014 from$3.4 million , or 82% of total revenue for the first quarter of 2013. -
Net income attributable to common stockholders improved to
$8.5 million for the first quarter of 2014 from$2.8 million for the first quarter of 2013. -
Cash and cash equivalents totaled
$10.9 million atMarch 31, 2014 , as compared to$7.8 million atDecember 31, 2013 .
Non-GAAP Measures
In evaluating the operating performance of its business, Luna’s management excludes certain charges and credits that are required by generally accepted accounting principles (“GAAP”). These non-GAAP results provide useful information to both management and investors by excluding items that the company believes may not be indicative of its operating performance, because either they are unusual and the company 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. These non-GAAP measures should be considered in addition to results and guidance prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. The non-GAAP measures included in this press release have 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 our expectations
regarding the company’s future growth and commercialization of the
company’s shape sensing platform and other growth opportunities in the
company's technology development segment. 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 the company 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 the company’s products and services to
meet expectations, technological challenges and those risks and
uncertainties set forth in the company’s periodic reports and other
filings with the
| Luna Innovations Incorporated | ||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||
| Three Months Ended March 31, | ||||||||||
| 2014 | 2013 | |||||||||
| (unaudited) | ||||||||||
| Revenue: | ||||||||||
| Technology development revenue | $ | 2,675,452 | $ | 2,627,241 | ||||||
| Products and licensing revenue | 1,796,429 | 1,478,127 | ||||||||
| Total revenue | 4,471,881 | 4,105,368 | ||||||||
| Cost of revenue: | ||||||||||
| Technology development costs | 2,025,155 | 2,184,914 | ||||||||
| Products and licensing costs | 894,640 | 785,728 | ||||||||
| Total cost of revenue | 2,919,795 | 2,970,642 | ||||||||
| Gross Profit | 1,552,086 | 1,134,726 | ||||||||
| Operating expense: | ||||||||||
| Selling, general and administrative | 2,755,078 | 2,663,108 | ||||||||
| Research, development and engineering | 749,154 | 712,952 | ||||||||
| Total operating expense | 3,504,232 | 3,376,060 | ||||||||
| Operating loss | (1,952,146 | ) | (2,241,334 | ) | ||||||
| Other income/(expense): | ||||||||||
| Other income, net | 82,106 | 98,154 | ||||||||
| Interest expense | (32,365 | ) | (58,179 | ) | ||||||
| Total other income | 49,741 | 39,975 | ||||||||
| Loss from continuing operations before income taxes | (1,902,405 | ) | (2,201,359 | ) | ||||||
| Income tax benefit | (939,815 | ) | (898,433 | ) | ||||||
| Loss from continuing operations | (962,590 | ) | (1,302,926 | ) | ||||||
| Income from discontinued operations, net of income taxes | 9,502,814 | 4,088,523 | ||||||||
| Net Income | 8,540,224 | 2,785,597 | ||||||||
| Preferred stock dividend | 29,536 | 23,629 | ||||||||
| Net income attributable to common stockholders | $ | 8,510,688 | $ | 2,761,968 | ||||||
| Net loss per share from continuing operations: | ||||||||||
| Basic | $ | (0.07 | ) | $ | (0.09 | ) | ||||
| Diluted | $ | (0.07 | ) | $ | (0.09 | ) | ||||
| Net income per share from discontinued operations: | ||||||||||
| Basic | $ | 0.65 | $ | 0.29 | ||||||
| Diluted | $ | 0.55 | $ | 0.25 | ||||||
| Net income per share attributable to common stockholders: | ||||||||||
| Basic | $ | 0.58 | $ | 0.20 | ||||||
| Diluted | $ | 0.49 | $ | 0.17 | ||||||
| Weighted average common shares and common equivalent shares outstanding: | ||||||||||
| Basic | 14,653,262 | 14,011,814 | ||||||||
| Diluted | 17,424,769 | 16,615,574 | ||||||||
| Luna Innovations Incorporated | ||||||||||
| Condensed Consolidated Balance Sheets | ||||||||||
| March 31, 2014 | December 31, 2013 | |||||||||
|
Assets |
Unaudited | |||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 10,886,015 | $ | 7,778,541 | ||||||
| Accounts receivable, net | 10,512,087 | 5,408,281 | ||||||||
| Inventory, net | 3,294,498 | 3,346,177 | ||||||||
| Prepaid expenses | 542,788 | 708,974 | ||||||||
| Other current assets | 70,208 | 70,208 | ||||||||
| Total current assets | 25,305,596 | 17,312,181 | ||||||||
| Property and equipment, net | 1,960,095 | 2,060,709 | ||||||||
| Intangible assets, net | 223,366 | 288,475 | ||||||||
| Other assets | 23,918 | 42,710 | ||||||||
| Total assets | $ | 27,512,975 | $ | 19,704,075 | ||||||
| Liabilities and stockholders’ equity | ||||||||||
| Liabilities: | ||||||||||
| Current Liabilities: | ||||||||||
| Current portion of long-term debt obligation | $ | 1,500,000 | $ | 1,500,000 | ||||||
| Current portion of capital lease obligation | 67,621 | 66,617 | ||||||||
| Accounts payable | 1,257,633 | 1,401,764 | ||||||||
| Accrued liabilities | 3,061,184 | 3,546,585 | ||||||||
| Deferred credits | 552,831 | 691,424 | ||||||||
| Total current liabilities | 6,439,269 | 7,206,390 | ||||||||
| Long-term debt obligation | 250,000 | 625,000 | ||||||||
| Long-term lease obligation | 93,021 | 110,307 | ||||||||
| Total liabilities | 6,782,290 | 7,941,697 | ||||||||
| Commitments and contingencies | ||||||||||
| Stockholders’ equity: | ||||||||||
| Preferred stock, par value $ 0.001, 1,321,514 shares authorized, issued and outstanding at March 31, 2014 and December 31, 2013 | 1,322 | 1,322 | ||||||||
| Common stock, par value $ 0.001, 100,000,000 shares authorized, 14,731,652 and 14,527,335 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively | 15,066 | 14,842 | ||||||||
| Additional paid-in capital | 63,213,966 | 62,756,571 | ||||||||
| Accumulated deficit | (42,499,669 | ) | (51,010,357 | ) | ||||||
| Total stockholders’ equity | 20,730,685 | 11,762,378 | ||||||||
| Total liabilities and stockholders’ equity | $ | 27,512,975 | $ | 19,704,075 | ||||||
| Luna Innovations Incorporated | ||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||
| Three Months Ended | ||||||||||
| March 31, | ||||||||||
| 2014 | 2013 | |||||||||
| (unaudited) | ||||||||||
| Cash flows used in operating activities | ||||||||||
| Net income | $ | 8,540,224 | $ | 2,785,597 | ||||||
| Adjustments to reconcile net loss to net cash used in operating activities | ||||||||||
| Depreciation and amortization | 202,305 | 228,267 | ||||||||
| Share-based compensation | 230,939 | 313,516 | ||||||||
| Gain on sale of discontinued operations, net of income taxes | (9,537,241 | ) | (4,029,210 | ) | ||||||
| Tax benefit from utilization of net operating loss carryforward | (951,592 | ) | (861,071 | ) | ||||||
| Change in assets and liabilities: | ||||||||||
| Accounts receivable | 896,194 | 2,039,952 | ||||||||
| Inventory | 13,314 | (185,004 | ) | |||||||
| Other current assets | 112,286 | (127,333 | ) | |||||||
| Other assets | 18,792 | 53,792 | ||||||||
| Accounts payable and accrued expenses | (821,763 | ) | (231,431 | ) | ||||||
| Deferred credits | (138,593 | ) | (259,427 | ) | ||||||
| Net cash used in operating activities | (1,435,135 | ) | (272,352 | ) | ||||||
| Cash flows provided by investing activities | ||||||||||
| Acquisition of property and equipment | (67,944 | ) | (50,255 | ) | ||||||
| Intangible property costs | (126,091 | ) | (11,777 | ) | ||||||
| Proceeds from sale of discontinued operations, net of fees | 4,958,891 | 4,522,460 | ||||||||
| Net cash provided by investing activities | 4,764,856 | 4,460,428 | ||||||||
| Cash flows used in financing activities | ||||||||||
| Payments on capital lease obligations | (16,282 | ) | (13,221 | ) | ||||||
| Payment on debt obligations | (375,000 | ) | (250,000 | ) | ||||||
| Proceeds from the exercise of options and warrants | 169,035 | 1,682 | ||||||||
| Net cash used in financing activities | (222,247 | ) | (261,539 | ) | ||||||
| Net increase in cash or cash equivalents | 3,107,474 | 3,926,537 | ||||||||
| Cash and cash equivalents—beginning of period | 7,778,541 | 6,340,461 | ||||||||
| Cash and cash equivalents—end of period | $ | 10,886,015 | $ | 10,266,998 | ||||||
| Luna Innovations Incorporated | ||||||||||
| Reconciliation of Net Income to EBITDA and Adjusted EBITDA | ||||||||||
| Three Months Ended March 31, | ||||||||||
| 2014 | 2013 | |||||||||
| (unaudited) | ||||||||||
| Net income | $ | 8,540,224 | $ | 2,785,597 | ||||||
| Less income from discontinued operations, net of income taxes | 9,502,814 | 4,088,523 | ||||||||
| Loss from continuing operations | (962,590 | ) | (1,302,926 | ) | ||||||
| Interest expense | 32,365 | 64,056 | ||||||||
| Tax benefit | (939,815 | ) | (898,433 | ) | ||||||
| Depreciation and amortization | 202,305 | 228,267 | ||||||||
| EBITDA | (1,667,735 | ) | (1,909,036 | ) | ||||||
| Share-based compensation | 230,939 | 313,516 | ||||||||
| Adjusted EBITDA | $ | (1,436,796 | ) | $ | (1,595,520 | ) | ||||
Source:
Luna Innovations Incorporated
Dale Messick, CFO
1-540-769-8400
[email protected]