Advanced Photonix, Inc. Reports Fourth Quarter and Fiscal 2006 Results.ANN ARBOR Ann Arbor, city (1990 pop. 109,592), seat of Washtenaw co., S Mich., on the Huron River; inc. 1851. It is a research and educational center, with a large number of government and industrial research and development firms, many in high-technology fields such as , Mich. -- Advanced Photonix, Inc.(R) (AMEX AMEX See: American Stock Exchange : API (Application Programming Interface) A language and message format used by an application program to communicate with the operating system or some other control program such as a database management system (DBMS) or communications protocol. ) (the "Company") today reported its fourth quarter and year-end fiscal 2006 results. The Company reported a net loss of $(2,624,000), or $(0.14) per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, on sales of $6,803,000 for its fourth quarter ended March 31, 2006, as compared with net income of $4,612,000, or $0.29 per diluted share, on sales of $3,989,000 for the quarter ended March 27, 2005. For the twelve months ended March 31, 2006, the Company reported a net loss of $(3,465,000), or $(0.20) per diluted share, on sales of $23,585,000, as compared with net income of $5,254,000, or $0.34 per diluted share, on sales of $14,803,000 for the twelve months ended March 27, 2005. The pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma net loss for the twelve month period ended March 31, 2006 was $(635,000), or $(0.04) per share, compared to pro forma net income of $727,000 or $0.05 per share, for the comparable period a year ago. Pro forma net income is net income as determined in accordance with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ) increased by prepaid pre·pay tr.v. pre·paid, pre·pay·ing, pre·pays To pay or pay for beforehand. pre·pay  ment n. finance expense amortization, intangible/patent amortization, goodwill
impairment Impairment1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. , and interest expense related to financing for acquisitions and reduced by income tax provision decreases due to deferred tax asset valuation allowances. On an EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become basis (GAAP earnings before interest, taxes, depreciation, and amortization Earnings before interest, taxes, depreciation, and amortization (EBITDA) A financial measure defined as revenues less cost of goods sold and selling, general, and administrative expenses. ), the Company reported a net loss of $(476,000) for the fourth quarter of 2006 and a net gain of $870,000 for the twelve month period ended March 31, 2006. This compares to a net gain of $179,000 and $1,220,000, respectively, for the fourth quarter of 2005 and the twelve-month period ended March 27, 2005. The Company's revenues for fiscal 2006 were $23.6 million, an increase of $8.8 million, or 59%, over revenues of $14.8 million for the fiscal year ended March 27, 2005. Approximately $7.6 million of the increase was attributable to revenues from the Picometrix acquisition in May 2005. The remaining increase of $1.2 million reflects an overall increase in shipments of 8% to customers in each of the Company's remaining markets over the prior year. The most significant revenue increases came from the telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. , homeland security Noun 1. Homeland Security - the federal department that administers all matters relating to homeland security Department of Homeland Security executive department - a federal department in the executive branch of the government of the United States and industrial sensing markets. The acquisition of Picometrix significantly extended the Company's penetration into the telecommunications market with high-speed optical receiver products and the homeland security market with Terahertz ter·a·hertz n. Abbr. THz One trillion (1012) hertz. Noun 1. terahertz - one trillion periods per second THz contracts and products. Revenue in the telecommunications market was $3,129,000 compared to $86,000 in the prior year. Revenue in the homeland security market was $2,009,000 compared to zero in the prior year. Revenue in the industrial sensing market was $10,359,000, an increase of $2,999,000, or 41%, over the prior year due to the additional revenue from the recent acquisitions and organic growth. Revenue in the military market was $5,860,000 compared to $4,875,000 in the prior year, an increase of $985,000, or 20%. Revenue in the medical market was $2,228,000, a decrease of $254,000, or 10%, over the prior year due primarily to price reductions only partially offset by volume increases. As expected, the increased diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. and larger customer base achieved through the Company's acquisitions have resulted in net revenues meeting our expectations for the most recent fiscal year. The Company continues to expect consolidated revenue to increase in fiscal 2007 as compared to fiscal 2006; however our shipment schedules and thus recognition of revenue are primarily dependent on customer defined delivery schedules. As such, our quarter-to-quarter comparisons often vary for revenue and revenues by market, due to fluctuations in customer delivery schedules, which are beyond our control. Cost of product sales was $14.4 million in 2006 (61% of sales) compared to $10.1 million in 2005 (68% of sales). Cost of product sales in 2006 included a $1.1 million obsolete and slow moving inventory write-off in our California facility during the fourth quarter. Gross profit was $9.2 million in 2006 (an increase of 96%) compared to $4.7 million in 2005. The increase in gross profit is primarily attributable to the acquisition of Picometrix, whose products carry higher gross margins. The Company is actively seeking ways to minimize costs and improve manufacturing efficiencies to increase gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. , and have made this a priority for fiscal 2007. In that regard one of the major steps the Company is now undertaking is the previously announced consolidation of wafer fabrication Wafer Fabrication is a procedure composed of many repeated sequential processes to produce complete electrical or photonic circuits. Examples include production of radio frequency (RF) amplifiers, LEDs, optical computer components, and CPUs for computers. from California and Wisconsin into the Ann Arbor facility. Research and development expenses were $3.0 million in 2006 compared to $146,000 in 2005. The increase in Research & Development expenses is primarily the result of the Company's Picometrix acquisition. The Company expects that Research & Development expenses will increase in fiscal 2007, reflecting new opportunities as a result of the Picometrix acquisition. Marketing and sales expenses were $1.9 million in 2006, (8% of sales) compared to $1.2 million in 2005 (8% of sales). The increase is primarily attributable to telecommunications sales and marketing expenses. The Company is anticipating continuing to build sales & marketing expenses in the telecommunications, home land security, military and industrial sensing markets to support our growth in these markets. General and administrative expenses were $6.8 million in 2006 (29% of sales), including amortization and goodwill impairment expense, compared to $2.7 million in 2005 (18% of sales). The increase is primarily attributable to $2.6 million of intangible write-offs and amortization, including goodwill impairment of $814,000 for Texas Optoelectronics See optoelectronic. , $1.4 million amortization of intangibles related to the Picometrix acquisition, and $387,000 of financing expense amortization primarily related to the Picometrix acquisition. The balance of $1.5 million in increased General & Administrative expenses is the result of added corporate expenses related to the Picometrix acquisition and Sarbanes-Oxley Act See SOX. compliance expenses. The Sarbanes-Oxley Act section 404, internal controls, requires the Company to be compliant by fiscal year ending March 2008, based on current market capitalization Market Capitalization A measure of a public company's size. Market capitalization is the total dollar value of all outstanding shares. It's calculated by multiplying the number of shares times the current market price. This term is often referred to as market cap. . External costs required to be in compliance will materially increase over the next two years. Richard Kurtz, Chairman and Chief Executive Officer, commented, "Fiscal 2006 has been an exciting year. We have taken API from a single product line to a three product line company, offering Optosolutions, High Speed Optical Receivers and Terahertz Instrumentation. This expansion of our offerings brings new technology, new customers, new market opportunities, increased revenues and significant growth possibilities to API. Our new operations team in California has made corrections to the manufacturing and inventory issues that significantly impacted our performance in 2006. In fiscal 2007, we intend to focus on the execution and delivery of these new growth opportunities across all of our product lines in order to build value for our shareholders. Looking to 2007 we are projecting revenues to grow 15% to 20% over 2006". This press release, the financial tables, as well as other supplemental information including the reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures, will also be available on our website under the "Investor Relations Investor relations The process by which the corporation communicates with its investors. " link. The Company will hold a conference call to discuss the results for the fourth quarter and fiscal year ended March 31, 2006 on Thursday, June 29, 2006, at 5:00 PM EST EST electroshock therapy. EST abbr. electroshock therapy . Participants can dial into the conference call at 866-831-6267 (617-213-8857 for international) using the pass code 95048404. The call will be webcast live by CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network and can be accessed at Advanced Photonix's web site at http://investor.advancedphotonix.com/ or at www.earnings.com. An audio replay of the call will be available shortly thereafter the same day and will remain on-line for two weeks. The replay number is 888-286-8010 (617-801-6888 for international) using pass code 45855391. The information contained herein includes forward looking statements that are based on assumptions that management believes to be reasonable but are subject to inherent uncertainties and risks including, but not limited to, risks associated with the integration of newly acquired businesses, technological obstacles which may prevent or slow the development and/or manufacture of new products, limited (or slower than anticipated) customer acceptance of new products which have been and are being developed by the Company and a decline in the general demand for optoelectronic Refers to devices that function due to the interaction of light and electronics. For example, an electronic signal is the input to a laser diode, which generates light pulses that are transmitted through an optical fiber. products.
Advanced Photonix, Inc.
Financial Highlights
Quarter ended Twelve months ended
March March March March
31, 2006 27, 2005 31, 2006 27, 2005
-------------------------------------------------
Other Financial Data:
Net Sales $ 6,803,000 $3,989,000 $23,585,000 $14,803,000
Gross Profit 1,913,000 1,157,000 9,183,000 4,732,000
Percent to Net
Sales 28.1% 29.0% 38.9% 32.0%
Net Income (Loss) $(2,624,000) $4,612,000 $(3,465,000) $ 5,254,000
Net Earnings per
share $ (0.14)$ 0.34 $ (0.20) $ 0.39
Diluted earnings per
share $ (0.14)$ 0.29 $ (0.20) $ 0.34
Weighted Number of
shares outstanding 18,882,000 13,544,000 17,477,000 13,461,000
Non-GAAP Financial Measures The Company provides pro forma Net Income and EBITDA as supplemental financial information regarding the Company's operational performance. These Non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . pro forma Net Income and EBITDA should not be considered in isolation from or as a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from similar measures used by other companies. Reconciliation of pro forma Net Income and EBITDA to GAAP net income and loss are set forth in the financial schedule section below.
Reconciliation of EBITDA to GAAP Income
Quarter ended Twelve months ended
March March March March
31, 2006 27, 2005 31, 2006 27, 2005
--------------------------------------------------
Net Income (Loss) $(2,624,000) $4,612,000 $(3,465,000) $ 5,254,000
Adjustments
Depreciation 248,000 100,000 829,000 369,000
Net Interest expense
(income) 390,000 70,000 874,000 111,000
Amortization -
intangibles/patents 458,000 28,000 1,403,000 117,000
Amortization -
prepaid finance
expense 210,000 81,000 387,000 81,000
Goodwill impairment
expense 814,000 - 814,000 -
Income Tax provision 28,000 (4,712,000) 28,000 (4,712,000)
EBITDA $ (476,000) $ 179,000 $ 870,000 $ 1,220,000
Reconciliation of Proforma Income to GAAP Income
Quarter ended Twelve months ended
March March March March
31, 2006 27, 2005 31, 2006 27, 2005
------------------------------------------------
Net Income (Loss) $(2,624,000) $4,612,000 $(3,465,000) $5,254,000
Adjustments
Interest expense -
convertible notes 242,000 141,000 388,000 141,000
Amortization -
Picometrix
intangibles/patents 425,000 - 1,241,000 -
Amortization - prepaid
finance expense 210,000 81,000 387,000 81,000
Goodwill impairment
expense -TOI 814,000 - 814,000 -
Income tax provision
decrease - deferred
tax asset valuation
allowance - (4,749,000) - (4,749,000)
Proforma Net Income $ (933,000) $ 85,000 $ (635,000) $ 727,000
Proforma Net Earnings
per share $ (0.05) $ 0.01 $ (0.04) $ 0.05
Diluted Earnings per
share $ (0.05) $ 0.01 $ (0.04) $ 0.05
Weighted Average Number
of shares outstanding 18,882,000 13,544,000 17,477,000 13,461,000
Advanced Photonix, Inc.(R) (AMEX - API) is a leading vertically integrated optoelectronic semiconductor manufacturer of optoelectronic solutions, high-speed optical receivers and terahertz instrumentation to a global OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and customer base. Products include patented silicon (Si), indium indium (ĭn`dēəm), a metallic chemical element; symbol In; at. no. 49; at. wt. 114.82; m.p. 156.6°C;; b.p. about 2,080°C;; sp. gr. 7.31 at 20°C;; valence +1, +2, or +3. phosphide phosphide Any of a class of chemical compounds in which phosphorous is combined with a metal. Phosphides exhibit a wide variety of chemical and physical properties. Phosphides that are rich in metal have high melting points and are hard, brittle, and chemically inert; these (InP) and gallium gallium (găl`ēəm), metallic chemical element; symbol Ga; at. no. 31; at. wt. 69.72; m.p. 29.78°C;; b.p. 2,403°C;; sp. gr. 5.904 at 29.6°C; (solid), 6.095 at 29.8°C; (liquid); valence +2 or +3. arsinide (GaAs) based APD APD atrial premature depolarization (see atrial premature complex, under complex ); pamidronate. , PIN, and FILTRODE(R) photodetectors; high-speed optical receivers; and the T-Ray(TM) 2000 and QA1000 THz product platforms. More information on Advanced Photonix can be found at http://www.advancedphotonix.com. |
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