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ProPhotonix Limited Announces a Statement RE COVID - 19 and Trading Update

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SALEM, NH / ACCESSWIRE / April 9, 2020 / ProPhotonix Limited (STKR)(PPIX.L)(PPIR.L), a high technology designer and manufacturer of LED illumination systems and laser diode modules, with operations in Ireland and the United Kingdom, announces an update today on the impact of the rapidly evolving COVID-19 pandemic on its business alongside measures the Company is taking to actively manage and mitigate the risks to its employees, customers and operations.

Employees and Customers

In order to ensure business continuity in day-to-day operations, the Company has implemented a series of actions to protect the health and safety of its employees following the advice from the local authorities and governments in the jurisdictions in which the Company operates. These are monitored and reviewed regularly and include: dialogue with employees, customers and suppliers; the diligence of office health and hygiene practices which follow specific health protection protocols; the adoption of flexible working arrangements; and restrictions on travel and meetings.


In the first three months of the current financial year there was no material COVID-19 impact on ProPhotonix' trading. However, it is inevitable that COVID-19 will adversely affect our business. In late March, a few customers ceased operations and have suspended procurement and acceptance of product. There have not yet been significant supply chain stoppages but there have been delays impacting some shipments. Whilst the Board is encouraged by the resilience shown by the Group and its employees to date, it expects further adverse customer and supplier actions. Given the inherent uncertainties surrounding COVID-19, the Board believe it is inappropriate to provide forward looking guidance to investors and analysts at the current time.

Cash flow and liquidity

Whilst the Company has always maintained a prudent approach to costs, due to the level of heightened uncertainty caused by COVID-19, the Company has identified and is implementing, or considering as necessary, mitigating actions to reduce costs to help offset the effect of expected lower production and sales in order to maximize liquidity and minimize utilization of cash resources. These actions include:

· A reduction of inventory levels and working capital more generally including to ensure prompt debtor collections;

· Plant closure and utilizing UK and Ireland government schemes in respect of payroll costs;

· A reduction or deferral of non-essential operating costs and new recruitment;

· The Non-executive directors have elected to suspend their remuneration for the second quarter, the CEO has agreed a temporary reduction in salary of 50% and the senior management has also agreed a temporary reduction in salary.

Tim Losik, CEO, said: "In these incredibly challenging times, we continue to be focused on ensuring the continued health, safety and well-being of our colleagues. We are all pulling together to manage these extraordinary circumstances in the world and our business. The impact of COVID-19 remains uncertain and as a result we are working with our key stakeholders; employees, customers and suppliers, to ensure we minimize the effect of the disruption. The mitigating actions we are putting in place or continue to plan for are focused on ensuring we maintain our liquidity, cash resources and future growth optionality. Despite these uncertain times, the Board remains confident in the Company's ability to successfully manage through this difficult period and our actions are the prudent ones to take at this time."


ProPhotonix Limited

Tim Losik, President & CEO

Tel: +1 603 893 8778


Cantor Fitzgerald Europe

(Nominated Adviser and Broker) Tel: +44 (0)207 894 7000

David Foreman, Luke Philippou (Corporate Finance)

Keith Dowsing (Sales)

About ProPhotonix

ProPhotonix Limited, headquartered in Salem, New Hampshire, is a high technology designer and manufacturer of diode-based laser modules and LED systems for industry leading OEMs and medical equipment companies. In addition, the Company distributes premium diodes for Ushio, Osram, QSI, Panasonic, and Sony. The Company serves a wide range of markets including the machine vision, industrial inspection, security, UV curing, and medical markets. ProPhotonix has offices and subsidiaries in the U.S., Ireland, U.K., and Europe. For more information about ProPhotonix and its innovative products, visit the Company's web site at www.prophotonix.com.

Cautionary Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact, including without limitation, those with respect to ProPhotonix's goals, plans and strategies set forth herein are forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: uncertainty that cash balances will be sufficient to allow ProPhotonix to meet all of its business goals; uncertainty that ProPhotonix's new products will gain market acceptance; the risk that delays and unanticipated expenses in developing new products could delay the commercial release of those products and affect revenue estimates; the risk that one of our competitors could develop and bring to market a technology that is superior to those products that we are currently developing; and ProPhotonix's ability to capitalize on its significant research and development efforts by successfully marketing those products that the Company develops. Forward-looking statements represent management's current expectations and are inherently uncertain. All Company, brand, and product names are trademarks or registered trademarks of their respective holders. ProPhotonix undertakes no duty to update any of these forward-looking statements.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

SOURCE: ProPhotonix Limited

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