U.S. Markets open in 4 hrs 38 mins

Dynasil Corporation of America Reports First Quarter Fiscal 2019 Results

Optics Segment Revenue up 16%

NEWTON, Mass., Feb. 13, 2019 (GLOBE NEWSWIRE) -- Dynasil Corporation of America (DYSL), a developer and manufacturer of optics and photonics products, optical detection and analysis technology and components for the homeland security, medical and industrial markets, today announced revenue of $10.0 million for the first quarter of fiscal year 2019.

“Overall revenue for the first quarter increased 9%, fueled by a 16% increase in revenue for our Optics segment, as compared to the same period last year,” said CEO Peter Sulick. “Our Innovation and Development segment revenue increased 1%, as compared to the quarter ended December 31, 2017.”

“We continue to invest in growth initiatives in our Optics segment to support further revenue growth,” continued Mr. Sulick. “The operating expenses in our Optics segment increased 20% over the same period last year, partially attributable to an increase in personnel for our growth initiatives, as well as the recent scale up in our marketing initiatives. Additionally, the approximately $160,000 in accounting expenses incurred due to the implementation of new revenue recognition policies impacted both our Optics and Innovation and Development segments.”

Certain key metrics by segment for the current quarter and the same quarter last year are presented below: 

Results of Operations for the Three Months Ended December 31, 2018
  Optics Innovation and
Development*
Biomedical Total
Revenue $ 5,721,000   $ 4,307,000   $ -   $ 10,028,000  
Gross profit   1,879,000     1,813,000     -     3,692,000  
GM %   33 %   42 %   -     37 %
Operating expenses   1,885,000     1,879,000     53,000     3,817,000  
Operating income (loss) $ (6,000 ) $ (66,000 ) $ (53,000 ) $ (125,000 )
         
         
Results of Operations for the Three Months Ended December 31, 2017
  Optics Innovation and
Development*
Biomedical Total
Revenue $ 4,942,000   $ 4,247,000   $ -   $ 9,189,000  
Gross profit   1,724,000     1,851,000     -     3,575,000  
GM %   35 %   44 %   -     39 %
Operating expenses   1,576,000     1,723,000     445,000     3,744,000  
Operating income (loss) $ 148,000   $ 128,000   $ (445,000 ) $ (169,000 )
         
*Formerly Contract Research       
         

Net income (loss) for the three months ended December 31, 2018 was a loss of ($0.1) million, or ($0.01) in basic earnings per share, compared with a loss of ($0.8) million, or ($0.05) in basic earnings per share in the three months ended December 31, 2017. For the quarter ended December 31, 2018, the Company recorded a tax benefit of $0.1 million. For the quarter ended December 31, 2017, due to the 2017 US Federal tax act, the Company recorded a tax expense of $0.7 million. 

Conference Call Information

Dynasil will host a conference call for investors and analysts at 5:00 p.m. ET on February 13, 2019.  The call will be hosted by Chairman, CEO and President Peter Sulick and Chief Financial Officer Robert Bowdring.  Those who wish to listen to the conference call can go to the event page or visit the Investor Information section of the Company’s website at www.dynasil.com. The call also may be accessed by dialing (toll free) 1-866-688-3138 or (international callers) 1-574-990-2948. For interested individuals unable to join the live conference call, a webcast replay will be available on the Company’s website for one year.

About Dynasil

Dynasil Corporation of America (DYSL) develops and manufactures optics and photonics products, optical detection and analysis technology and optical components for the homeland security, medical and industrial markets.  Combining world-class expertise in research and materials science with extensive experience in manufacturing and product development, Dynasil is selling and continuing to develop products for dual-mode radiation detection solutions for security and commercial applications and sensors for non-destructive testing.  Dynasil has an impressive and growing portfolio of issued and pending U.S. patents.  The Company is based in Newton, Massachusetts, with additional operations in Massachusetts, New Jersey, New York and the United Kingdom. More information about the Company is available at www.dynasil.com.

Forward-Looking Statements

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements regarding future events and our future results are based on current expectations, estimates, forecasts, and projections and the beliefs and assumptions of our management, including, without limitation, our expectations regarding results of operations, our compliance with the financial covenants under our loan agreements with Middlesex Savings Bank and Massachusetts Capital Resource Company, the commercialization of our technology, including the Xcede patch and our dual mode detectors, the success of efforts to develop a successful Xcede Patch and to fund that development, our development of new technologies including at Dynasil Biomedical, the adequacy of our current financing sources to fund our current operations, our growth initiatives, our capital expenditures and the strength of our intellectual property portfolio. These forward-looking statements may be identified by the use of words such as “plans,” “intends,” “may,” “could,” “expect,” “estimate,” “anticipate,” “continue,” or similar terms, though not all forward-looking statements contain such words. The actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements due to a number of important factors. These factors that could cause actual results to differ from those anticipated or predicted include, without limitation, our ability to develop and commercialize our products, including obtaining regulatory approvals, the size and growth of the potential markets for our products and our ability to serve those markets, the rate and degree of market acceptance of any of our products, general economic conditions, costs and availability of raw materials and management information systems, our ability to obtain and maintain intellectual property protection for our products, Xcede’s ability to produce preclinical data sufficient to enable it to initiate clinical studies of hemostatic patch, clinical results of Xcede’s programs which may not support further development, the ability of our RMD business unit to identify and pursue possible continued development opportunities for the Xcede patch, which is not assured, competition, the loss of key management and technical personnel, our ability to obtain timely payment of our invoices to governmental customers, litigation, the effect of governmental regulatory developments, the availability of financing sources, our ability to deleverage our balance sheet, our ability to identify and execute on acquisition opportunities and integrate such acquisitions into our business, and seasonality, as well as the uncertainties set forth in the Company’s Annual Report on Form 10-K, including the risk factors contained in Item 1A, and from time to time in the Company's other filings with the Securities and Exchange Commission. The Company disclaims any intention or obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

       
Dynasil Corporation of America and Subsidiaries
Consolidated Balance Sheets (Unaudited)
       
ASSETS December 31, 2018   September 30, 2018
Current Assets      
Cash and cash equivalents $ 1,165,000   $ 2,327,000
Accounts receivable, net   3,471,000     4,069,000
Unbilled receivables   1,245,000     1,215,000
Contract assets   21,000     -
Inventories, net of reserves   4,492,000     4,106,000
Prepaid expenses and other current assets   801,000     664,000
Total current assets   11,195,000     12,381,000
       
Property, Plant and Equipment, net   7,956,000     8,098,000
Other Assets      
Intangibles, net   718,000     755,000
Deferred tax asset   4,394,000     4,333,000
Goodwill   5,864,000     5,900,000
Long term contract assets   4,000     7,000
Security deposits   53,000     58,000
Total other assets   11,033,000     11,053,000
       
Total Assets $ 30,184,000   $ 31,532,000
       
LIABILITIES AND STOCKHOLDERS' EQUITY      
Current Liabilities      
Equipment line of credit $ 240,000   $ -
Current portion of long-term debt   1,253,000     1,246,000
Capital lease obligations, current   34,000     40,000
Accounts payable   1,669,000     2,355,000
Contract liabilities   157,000     253,000
Accrued expenses and other liabilities   2,322,000     2,803,000
Total current liabilities   5,675,000     6,697,000
       
Long-term Liabilities      
Long-term debt   1,898,000     2,075,000
Long-term capital lease obligations   44,000     52,000
Deferred tax liability   199,000     205,000
Other long-term liabilities   178,000     175,000
Total long-term liabilities   2,319,000     2,507,000
       
Stockholders' Equity      
Dynasil stockholders' equity   20,898,000     21,029,000
Noncontrolling interest   1,292,000     1,299,000
Total stockholders' equity   22,190,000     22,328,000
       
Total Liabilities and Stockholders' Equity $ 30,184,000   $ 31,532,000
       


 
Dynasil Corporation of America
Consolidated Statement of Operations and Comprehensive Income (Loss)
(Unaudited)
   
  Three Months Ended
  December 31,
  2018   2017
Net revenue $ 10,028,000     $ 9,189,000  
Cost of revenue   6,336,000       5,614,000  
Gross profit   3,692,000       3,575,000  
Operating expenses:      
Sales and marketing   398,000       279,000  
Research and development   177,000       308,000  
General and administrative   3,242,000       3,157,000  
       
Total operating expenses   3,817,000       3,744,000  
Income (loss) from operations   (125,000 )     (169,000 )
Interest expense, net   42,000       43,000  
Income (loss) before taxes   (167,000 )     (212,000 )
Income tax (benefit)   (65,000 )     660,000  
Net income (loss)   (102,000 )     (872,000 )
Less: Net income (loss) attributable to noncontrolling interest   (9,000 )     (75,000 )
Net income (loss) attributable to common stockholders $ (93,000 )   $ (797,000 )
       
       
Net income (loss) $ (102,000 )   $ (872,000 )
Other comprehensive income (loss):      
Foreign currency translation   (141,000 )     35,000  
Total comprehensive income (loss)   (243,000 )     (837,000 )
Less: comprehensive income (loss) attributable to      
noncontrolling interest   (9,000 )     (75,000 )
Total comprehensive income (loss) attributable to      
common stockholders $ (234,000 )   $ (762,000 )
       
Basic net income (loss) per common share $ (0.01 )   $ (0.05 )
Diluted net income (loss) per common share $ (0.01 )   $ (0.05 )
       
Weighted average shares outstanding      
Basic   17,324,976       17,047,690  
Diluted   17,324,976       17,047,690  
       

Contact:
Patty Kehe
Corporate Secretary
Dynasil Corporation of America
Phone: 617.668.6855
pkehe@dynasil.com