Energy Focus, Inc. (NASDAQ:EFOI), a leader in sustainable LED
lighting technologies, today announced financial results for its
fourth quarter and fiscal year ended December 31, 2019.
Fourth Quarter 2019 and Subsequent Business
Highlights
- Net sales of $3.5 million, up 21.1% from third quarter 2019 and
up 13.2% from fourth quarter 2018
- Net loss of $1.3 million, a year-over-year improvement of $1.7
million
- Awarded a $2.5 million contract to supply LED globe lights and
a $3.4 million contract to supply tubular LED (TLED) lighting
products to the U.S. Navy, as well as a $1.7 million contract to
supply LED lighting products for four new ship for a U.S. allied
Navy
- Filed patents and trademarks regarding EnFocusTM, our
breakthrough lighting control platform
- Strengthened leadership teams in business development,
marketing and production
- During November 2019 completed a debt financing of
approximately $1.3 million on a gross basis
- During January 2020 completed a registered direct equity
offering and concurrent private placement for $2.75 million in
aggregate gross proceeds
“Fourth quarter revenue represents our first quarter of
sequential and year-over-year growth since 2015,” stated James Tu,
Chairman and CEO of Energy Focus, Inc. “This sales growth is a
direct result of our dedicated efforts to enhance engineering
designs, reduce production costs and rebuild a highly-motivated,
talented sales organization focused on winning business by actively
engaging with and educating customers on our high-quality and
innovative LED lighting technologies and solutions. Since fourth
quarter of 2019, we have been awarded over $7.6 million in new
contracts from the U.S. and allied Navies, demonstrating our
strengthening competitiveness and leadership as a leading LED
lighting provider for the U.S. Navy ecosystem. We also added
several new customers in education, healthcare and commercial and
industrial sectors. Overall, the business transformation
initiatives we began in the first half of 2019 are gaining
momentum, generating new orders and customers, and creating a
runway for continuing growth in 2020 and beyond.”
Mr. Tu continued, “The LED lighting industry is entering a rapid
adoption phase after nearly a decade of building awareness. We are
especially encouraged by the continuing support from our existing
customers and from large new customers that value our proven and
sustainable product portfolio that optimizes financial,
environmental and human impacts for their facilities. More and
more, LED lighting is incorporating advanced electronics and
software technologies to emerge as a central and integrated part of
building IoT infrastructure. With a whole new family of patented
controlled lighting products being launched this month and
delivered starting in the second quarter of this year, we believe
we are in a strong position to expand the benefits of LED lighting
beyond delivering environmental sustainability with our new
EnFocus™ lighting platform and into elevating human well-being and
performance, thereby addressing and penetrating the broader
lighting retrofit market in a significant and meaningful way.”
Fourth Quarter 2019 Financial Results:
Net sales were $3.5 million for the fourth quarter of 2019. This
compares with net sales of $2.9 million in the third quarter of
2019 and $3.1 million in the fourth quarter of 2018. Net sales from
commercial products were $2.0 million, or 57.5% of total net sales,
for the fourth quarter of 2019, up from $1.7 million, or 59.5% of
total net sales, in the third quarter of 2019 and $1.2 million, or
38.3% of total net sales, in the fourth quarter of 2018. The
increase was mainly due to new sales to several school districts
and colleges, as well as increases in sales of our RedCap™
products. Net sales from military and maritime products were $1.5
million, or 42.5% of total net sales, for the fourth quarter of
2019, up from $1.2 million, or 40.5% of total net sales, in the
third quarter of 2019 and down from $1.9 million, or 61.7% of total
net sales, in the fourth quarter of 2018. The quarter-over-quarter
improvement was due to sales that shifted to the fourth quarter of
2019 due to the budgetary constraints at the Defense Logistics
Agency during the third quarter of 2019, and the year-over-year
reduction was driven primarily by reduced sales to one large
distributor to the Navy.
Gross profit was $1.0 million, or 27.1% of net sales, for the
fourth quarter of 2019, including excess and obsolete, and related
reserves that reduced gross profit by 214 basis points of net
sales. This compares with gross profit of $1.0 million, or 35.3% of
net sales in the third quarter of 2019, and $19 thousand or 0.6%,
of net sales in the fourth quarter of 2018.
Operating loss was $1.2 million for the fourth quarter of 2019.
This compares with an operating loss of $0.8 million in the third
quarter of 2019 and an operating loss of $3.0 million in the fourth
quarter of 2018.
Net loss was $1.3 million for the fourth quarter of 2019,
compared with a net loss of $0.9 million in the third quarter of
2019 and a net loss of $3.0 million in the fourth quarter of 2018.
Net loss per share was $0.11 for the fourth quarter of 2019,
compared with a net loss per share of $0.08 in the third quarter of
2019 and a net loss per share of $0.25 in the fourth quarter of
2018.
Adjusted EBITDA, as defined under “Non-GAAP Measures” below, was
a loss of $1.1 million for the fourth quarter of 2019, compared
with a of $0.8 million in the third quarter of 2019 and a loss of
$2.5 million in the fourth quarter of 2018.
Full-Year 2019 Financial Results
Net sales were $12.7 million for 2019 compared with $18.1
million for 2018. Net sales from commercial products were $7.9
million, or 62.0% of total net sales, for 2019 compared with $8.7
million, or 47.8% of total net sales, for 2018. Net sales from
military and maritime products were $4.8 million, or 38.0% of total
net sales, for 2019, compared with $9.4 million, or 52.2% of total
net sales, for 2018.
Gross profit was $2.0 million, or 15.5% of net sales, for 2019,
including excess and obsolete, and related reserves of $48 thousand
that decreased gross profit by 38 basis points of net sales. This
compares with gross profit of $3.4 million, or 18.8% of net sales
for 2018, including excess and obsolete, and related reserves of
$16 thousand that decreased gross profit by 9 basis points of net
sales.
Operating loss was $7.0 million for 2019. This compares with an
operating loss of $9.1 million for 2018.
Net loss was $7.4 million for 2019, compared with a net loss of
$9.1 million for 2018. Net loss per share was $0.60 for 2019,
compared with a net loss per share of $0.76 for 2018.
Adjusted EBITDA, as defined under “Non-GAAP Measures” below, was
a loss of $5.9 million for 2019, compared with a loss of $7.2
million for 2018.
Cash and restricted cash held in other assets were $0.7 million
as of December 31, 2019. This compares with $0.6 million at the end
of the third quarter of 2019 and $6.3 million for fourth quarter
2018.
Financings
On November 25, 2019, the company sold and issued a $1.257
million promissory note bearing interest at an annual rate of 8%
(excluding original issue discount) with a maturity date of 24
months from the date of purchase in a private placement
transaction.
Subsequent to year-end, in January 2020, the company completed
the issuance and sale of 3,441,803 shares of its common stock to
certain institutional investors, at a purchase price of $0.674 per
share, in a registered direct offering. The company also sold the
same institutional investors unregistered warrants to purchase up
to 3,441,803 shares of its common stock at an exercise price of
$0.674 per share in a concurrent private placement for a purchase
price of $0.125 per warrant. Gross proceeds to the company were
$2.75 million. The company intends to use the net proceeds for
general corporate purposes.
COVID-19 Impact and First Quarter 2020
Outlook
We are actively monitoring and dynamically assessing and
responding to the impact from the ongoing coronavirus (COVID-19)
outbreak. To minimize infection risks of our employees and their
social and professional contacts, we have activated our COVID-19
Contingency Plan (CPP) that allows employees that could work
remotely to do so while implementing strict sanitary and
disinfection measures and procedures for our production facility in
Solon, Ohio. At this point, we have not seen opportunities lost due
to COVID-19 but have started to see some customer lighting retrofit
projects being put on hold or postponed. Our near-term sales,
mainly those from commercial sectors, could be adversely affected
if the current, dramatic slowdown of economic activities continues
over an extended period. In addition, potential government
regulation mandates could temporarily cause logistics bottlenecks
or cease our production operation, and increase the cost of or
prevent us from making or shipping products to customers. We aim to
update with investors if and when material developments on our
business or significant organizational changes transpire due to
COVID-19.
At this point, the Company projects first quarter 2020 sales in
the range of $3.5 million to $3.6 million, representing sequential
growth of 0%-6% compared with the fourth quarter of 2019, and a
13%-16% growth over the first quarter 2019.
Earnings Conference Call
The Company will host a conference call and webcast today, March
19, 2020 at 11 am ET to review the 2019 results, followed by a
Q&A session. To participate in the call, please dial toll-free
1-877-451-6152 or international 1-201-389-0879, and referencing the
conference ID# 13699827.
The conference call will be simultaneously webcast. To listen to
the webcast, log on to it at:
http://public.viavid.com/index.php?id=138339. The webcast will be
available at this link through April 2, 2020. Financial information
presented on the call, including the earnings press release, will
be available on the investors section of Energy Focus’ website at
investors.energyfocus.com.
Forward Looking Statements:
Forward-looking statements in this release are made pursuant to
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Generally, these statements can be identified
by the use of words such as “believes,” “estimates,” “anticipates,”
“expects,” “seeks,” “projects,” “intends,” “plans,” “may,” “will,”
“should,” “could,” “would” and similar expressions intended to
identify forward-looking statements, although not all
forward-looking statements contain these identifying words.
These forward-looking statements include all matters that are not
historical facts and include statements regarding our current
expectations concerning, among other things, our results of
operations, financial condition, liquidity, prospects, growth,
strategies, capital expenditures and the industry in which we
operate. By their nature, forward-looking statements involve risks
and uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future. Although we
base these forward-looking statements on assumptions that we
believe are reasonable when made, we caution you that
forward-looking statements are not guarantees of future performance
and that our actual results of operations, financial condition and
liquidity, and industry developments may differ materially from
statements made in or suggested by the forward-looking statements
contained in this release. We believe that important factors that
could cause our actual results to differ materially from
forward-looking statements include, but are not limited to: (i) our
need for additional financing in the near term to continue our
operations; (ii) our liquidity and refinancing demands; (iii) our
ability to obtain refinancing or extend maturing debt; (iv) our
ability to continue as a going concern for a reasonable period of
time; (v) our ability to implement plans to increase sales and
control expenses; (vi) our reliance on a limited number of
customers for a significant portion of our revenue, and our ability
to maintain or grow such sales levels; (vii) our ability to
increase sales by adding new customers to reduce the reliance of
our sales on a smaller group of customers, and the long sales-cycle
that our product requires; (viii) our ability to increase demand in
our targeted markets and to manage sales cycles that are difficult
to predict and may span several quarters; (ix) the timing of large
customer orders, significant expenses and fluctuations between
demand and capacity as we invest in growth opportunities; (x) our
ability to compete effectively against companies with lower cost
structures or greater resources, or more rapid development efforts,
and new competitors in our target markets; (xi) our ability
to successfully scale our network of sales representatives, agents,
and distributors to match the sales reach of larger, established
competitors; (xii) market acceptance of our high-quality LED
lighting technologies and products; (xiii) our ability to attract
and retain qualified personnel, and to do so in a timely manner;
(xiv) the impact of any type of legal inquiry, claim or dispute;
(xv) general economic conditions in the United States and in other
markets in which we operate or secure products; (xvi) our
dependence on military customers and on the levels and timing of
government funding available to such customers, as well as the
funding resources of our other customers in the public sector and
commercial markets; (xvii) business interruptions resulting from
health epidemics or pandemics or other contagious outbreaks, such
as the recent coronavirus or geopolitical actions, including war
and terrorism, natural disasters, including earthquakes, typhoons,
floods and fires; (xviii) our reliance on a limited number of
third-party suppliers, our ability to obtain critical components
and finished products from such suppliers on acceptable terms, and
the impact of our fluctuating demand on the stability of such
suppliers; (xix) our ability to timely and efficiently transport
products from our third-party suppliers to our facility by ocean
marine channels; (xx) our ability to respond to new lighting
technologies and market trends, and fulfill our warranty
obligations with safe and reliable products; (xxi) any delays we
may encounter in making new products available or fulfilling
customer specifications; (xxii) any flaws or defects in our
products or in the manner in which they are used or installed;
(xxiii) our ability to protect our intellectual property rights and
other confidential information, and manage infringement claims by
others; (xxiv) our compliance with government contracting laws and
regulations, through both direct and indirect sale channels, as
well as other laws, such as those relating to the environment and
health and safety; (xxv) risks inherent in international markets,
such as economic and political uncertainty, changing regulatory and
tax requirements and currency fluctuations, including tariffs and
other potential barriers to international trade; and (xxvi) our
ability to remediate a significant deficiency, maintain effective
internal controls and otherwise comply with our obligations as a
public company and under Nasdaq listing standards.
About Energy Focus
Energy Focus is an industry-leading innovator of
energy-efficient LED lighting technology. As the creator of the
first UL-verified flicker-free LED products, Energy Focus’ products
provide extensive energy and maintenance savings, as well as
safety, health and productivity benefits over conventional
lighting. Our customers serve the commercial, industrial,
healthcare, education and military markets.
Energy Focus is headquartered in Solon, Ohio. For more
information, visit our website at www.energyfocus.com.
Investor Contact:
Cameron Donahue(651) 653-1854cameron@haydenir.com
Condensed Consolidated Balance
Sheets(in thousands)
|
December 31, |
|
2019 |
|
2018 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash |
$ |
350 |
|
|
$ |
6,335 |
|
Trade accounts receivable, less allowances of $28 and $33,
respectively |
2,337 |
|
|
2,201 |
|
Inventories, net |
6,168 |
|
|
8,058 |
|
Prepaid and other current assets |
479 |
|
|
1,094 |
|
Total current assets |
9,334 |
|
|
17,688 |
|
Property and equipment, net |
389 |
|
|
610 |
|
Operating lease, right-of-use asset |
1,289 |
|
|
— |
|
Restructured lease, right-of-use asset |
322 |
|
|
— |
|
Other assets |
405 |
|
|
194 |
|
Total assets |
$ |
11,739 |
|
|
$ |
18,492 |
|
LIABILITIES |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
1,340 |
|
|
$ |
3,606 |
|
Accrued liabilities |
179 |
|
|
73 |
|
Accrued payroll and related benefits |
360 |
|
|
435 |
|
Accrued severance |
7 |
|
|
188 |
|
Accrued legal and professional fees |
215 |
|
|
160 |
|
Accrued sales commissions |
32 |
|
|
115 |
|
Accrued restructuring |
24 |
|
|
156 |
|
Accrued warranty reserve |
195 |
|
|
258 |
|
Deferred revenue |
18 |
|
|
30 |
|
Operating lease liabilities |
550 |
|
|
— |
|
Restructured lease liabilities |
319 |
|
|
— |
|
Finance lease liabilities, net of current portion |
3 |
|
|
— |
|
Convertible notes |
1,700 |
|
|
— |
|
Note, net of discount |
885 |
|
|
— |
|
Credit line borrowings |
715 |
|
|
2,219 |
|
Total current liabilities |
6,542 |
|
|
7,240 |
|
Other liabilities |
14 |
|
|
200 |
|
Operating lease liabilities, net of current portion |
906 |
|
|
— |
|
Restructured lease liabilities, net of current portion |
168 |
|
|
— |
|
Finance lease liabilities |
4 |
|
|
— |
|
Note Payable |
109 |
|
|
— |
|
Total liabilities |
7,743 |
|
|
7,440 |
|
|
|
|
|
STOCKHOLDERS’ EQUITY |
|
|
|
Preferred stock, par value $0.0001 per share: |
|
|
|
Authorized: 2,000,000 shares in 2019 and 2018 |
|
|
|
Issued and outstanding: no shares in 2019 and 2018 |
— |
|
|
— |
|
Common stock, par value $0.0001 per share: |
|
|
|
Authorized: 30,000,000 shares in 2019 and 2018 |
|
|
|
Issued and outstanding: 12,428,418 and 12,090,695 at December 31,
2019 and 2018, respectively |
1 |
|
|
1 |
|
Additional paid-in capital |
128,872 |
|
|
128,367 |
|
Accumulated other comprehensive loss |
(3 |
) |
|
(1 |
) |
Accumulated deficit |
(124,874 |
) |
|
(117,315 |
) |
Total stockholders’ equity |
3,996 |
|
|
11,052 |
|
Total liabilities and stockholders’ equity |
$ |
11,739 |
|
|
$ |
18,492 |
|
Condensed Consolidated Statements of
Operations(In thousands, except per share
data)
|
Three months ended |
|
Twelve months ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
2019 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Net sales |
$ |
3,531 |
|
|
$ |
2,915 |
|
|
$ |
3,118 |
|
|
$ |
12,705 |
|
|
$ |
18,107 |
|
Cost of sales |
2,574 |
|
|
1,887 |
|
|
3,099 |
|
|
10,731 |
|
|
14,695 |
|
Gross profit |
957 |
|
|
1,028 |
|
|
19 |
|
|
1,974 |
|
|
3,412 |
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
Product development |
249 |
|
|
191 |
|
|
657 |
|
|
1,284 |
|
|
2,597 |
|
Selling, general, and administrative |
1,925 |
|
|
1,689 |
|
|
2,178 |
|
|
7,449 |
|
|
9,789 |
|
Restructuring (credits) expense |
(47 |
) |
|
(19 |
) |
|
157 |
|
|
196 |
|
|
111 |
|
Total operating expenses |
2,127 |
|
|
1,861 |
|
|
2,992 |
|
|
8,929 |
|
|
12,497 |
|
Loss from operations |
(1,170 |
) |
|
(833 |
) |
|
(2,973 |
) |
|
(6,955 |
) |
|
(9,085 |
) |
|
|
|
|
|
|
|
|
|
|
Other expenses: |
|
|
|
|
|
|
|
|
|
Interest expense |
181 |
|
|
67 |
|
|
4 |
|
|
317 |
|
|
8 |
|
Other expenses |
(53 |
) |
|
46 |
|
|
9 |
|
|
91 |
|
|
7 |
|
|
|
|
|
|
|
|
|
|
|
Loss from operations before
income taxes |
(1,298 |
) |
|
(946 |
) |
|
(2,986 |
) |
|
(7,363 |
) |
|
(9,100 |
) |
Provision for income taxes |
10 |
|
|
— |
|
|
11 |
|
|
10 |
|
|
11 |
|
Net loss |
$ |
(1,308 |
) |
|
$ |
(946 |
) |
|
$ |
(2,997 |
) |
|
$ |
(7,373 |
) |
|
$ |
(9,111 |
) |
|
|
|
|
|
|
|
|
|
|
Net loss per share - basic and
diluted: |
$ |
(0.11 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.25 |
) |
|
$ |
(0.60 |
) |
|
$ |
(0.76 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted average shares used
in computing net loss per share: |
|
|
|
|
|
|
|
|
|
Basic and diluted |
12,309 |
|
|
12,370 |
|
|
12,075 |
|
|
12,309 |
|
|
11,997 |
|
Condensed Consolidated Statements of Cash
Flows(In thousands)
|
Three months ended |
|
Twelve months ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
2019 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Cash flows from operating
activities: |
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(1,308 |
) |
|
$ |
(946 |
) |
|
$ |
(2,997 |
) |
|
$ |
(7,373 |
) |
|
$ |
(9,111 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
|
|
|
|
Depreciation |
49 |
|
|
77 |
|
|
123 |
|
|
326 |
|
|
522 |
|
Stock-based compensation |
59 |
|
|
34 |
|
|
202 |
|
|
616 |
|
|
908 |
|
Provision for doubtful accounts receivable |
(25 |
) |
|
(18 |
) |
|
6 |
|
|
(5 |
) |
|
(9 |
) |
Provision for slow-moving and obsolete inventories and valuation
reserves |
657 |
|
|
(340 |
) |
|
549 |
|
|
14 |
|
|
17 |
|
Provision for warranties |
(29 |
) |
|
1 |
|
|
5 |
|
|
78 |
|
|
51 |
|
Amortization of discounts on long-term borrowings and acquisition
related liabilities |
6 |
|
|
— |
|
|
— |
|
|
6 |
|
|
— |
|
Amortization of loan origination fees |
30 |
|
|
27 |
|
|
4 |
|
|
102 |
|
|
4 |
|
Loss on dispositions of property and equipment |
9 |
|
|
— |
|
|
(2 |
) |
|
24 |
|
|
2 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
Accounts Receivable |
(531 |
) |
|
42 |
|
|
755 |
|
|
(131 |
) |
|
1,403 |
|
Inventories |
575 |
|
|
608 |
|
|
(2,172 |
) |
|
1,876 |
|
|
(2,356 |
) |
Prepaid and other assets |
243 |
|
|
(164 |
) |
|
109 |
|
|
611 |
|
|
(538 |
) |
Accounts payable |
97 |
|
|
(785 |
) |
|
600 |
|
|
(2,214 |
) |
|
2,047 |
|
Accrued and other liabilities |
(121 |
) |
|
244 |
|
|
(151 |
) |
|
(542 |
) |
|
240 |
|
Deferred revenue |
(6 |
) |
|
11 |
|
|
20 |
|
|
(12 |
) |
|
25 |
|
Total adjustments |
1,013 |
|
|
(263 |
) |
|
48 |
|
|
749 |
|
|
2,316 |
|
Net cash used in operating activities |
(295 |
) |
|
(1,209 |
) |
|
(2,949 |
) |
|
(6,624 |
) |
|
(6,795 |
) |
|
|
|
|
|
|
|
|
|
|
Cash flows from investing
activities: |
|
|
|
|
|
|
|
|
|
Acquisitions of property and equipment |
(75 |
) |
|
(29 |
) |
|
— |
|
|
(132 |
) |
|
(57 |
) |
Proceeds from the sale of property and equipment |
3 |
|
|
— |
|
|
6 |
|
|
3 |
|
|
246 |
|
Net cash (used in) provided by investing activities |
(72 |
) |
|
(29 |
) |
|
6 |
|
|
(129 |
) |
|
189 |
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing
activities: |
|
|
|
|
|
|
|
|
|
Proceeds from exercises of stock options and employee stock
purchase plan purchases |
— |
|
|
— |
|
|
7 |
|
|
— |
|
|
28 |
|
Principal payments under finance lease obligations |
(1 |
) |
|
(1 |
) |
|
— |
|
|
(3 |
) |
|
— |
|
Common stock withheld in lieu of income tax withholding on vesting
of restricted stock units |
6 |
|
|
— |
|
|
(2 |
) |
|
(110 |
) |
|
(62 |
) |
Loan origination fees |
(208 |
) |
|
— |
|
|
— |
|
|
(208 |
) |
|
— |
|
Net (payments on) proceeds from the Iliad Note |
1,115 |
|
|
— |
|
|
— |
|
|
1,115 |
|
|
— |
|
Proceeds from convertible notes |
— |
|
|
— |
|
|
— |
|
|
1,700 |
|
|
— |
|
Net payments on proceeds from credit line borrowings |
(504 |
) |
|
(328 |
) |
|
2,219 |
|
|
(1,400 |
) |
|
2,219 |
|
Net cash provided by (used in) financing activities |
408 |
|
|
(329 |
) |
|
2,224 |
|
|
1,094 |
|
|
2,185 |
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash |
17 |
|
|
(6 |
) |
|
— |
|
|
16 |
|
|
(5 |
) |
|
|
|
|
|
|
|
|
|
|
Net (decrease) increase in cash and restricted cash |
58 |
|
|
(1,573 |
) |
|
(719 |
) |
|
(5,643 |
) |
|
(4,426 |
) |
Cash and restricted cash at beginning of year |
634 |
|
|
2,207 |
|
|
7,054 |
|
|
6,335 |
|
|
10,761 |
|
Cash and restricted cash at end of period |
$ |
692 |
|
|
$ |
634 |
|
|
$ |
6,335 |
|
|
$ |
692 |
|
|
$ |
6,335 |
|
|
|
|
|
|
|
|
|
|
|
Classification of cash and
restricted cash: |
|
|
|
|
|
|
|
|
|
Cash |
350 |
|
|
292 |
|
|
6,335 |
|
|
350 |
|
|
6,335 |
|
Restricted cash held in other assets |
342 |
|
|
342 |
|
|
— |
|
|
342 |
|
|
— |
|
Cash and restricted cash |
$ |
692 |
|
|
$ |
634 |
|
|
$ |
6,335 |
|
|
$ |
692 |
|
|
$ |
6,335 |
|
Sales by Products(In
thousands)
|
Three months ended |
|
Twelve months ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
2019 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Commercial products |
$ |
2,030 |
|
|
$ |
1,733 |
|
|
$ |
1,193 |
|
|
$ |
7,877 |
|
|
$ |
8,662 |
|
Military maritime
products |
1,501 |
|
|
1,182 |
|
|
1,925 |
|
|
4,828 |
|
|
9,445 |
|
Total net sales |
$ |
3,531 |
|
|
$ |
2,915 |
|
|
$ |
3,118 |
|
|
$ |
12,705 |
|
|
$ |
18,107 |
|
Non-GAAP Measures
In addition to the results provided in accordance
with U.S. GAAP, we provide certain non-GAAP measures, which present
operating results on an adjusted basis. These are supplemental
measures of performance that are not required by or presented in
accordance with U.S. GAAP and, for the three and twelve months
ended December 31, 2019 and 2018, include adjustments for our
restructuring expenses, and for depreciation and stock compensation
expenses that do not have a current period impact on cash flow.
We believe that our use of non-GAAP financial measures permits
investors to assess the operating performance of our business
relative to our performance based on U.S. GAAP results and relative
to other companies within the industry by isolating the effects of
items that may vary from period to period without correlation to
core operating performance or that vary widely among similar
companies, and to assess cash flow performance of the operations of
our business relative to our U.S. GAAP results and relative to
other companies in the industry by isolating the effects of certain
items which do not have a current period cash flow impact. However,
our inclusion of these adjusted measures should not be construed as
an indication that our future results will be unaffected by unusual
or infrequent items or that the items for which we have made
adjustments are unusual or infrequent or will not recur. We believe
that the disclosure of these non-GAAP measures is useful to
investors as they form part of the basis for how our management
team and board of directors evaluate our operating performance.
These non-GAAP financial measures are not intended to replace
U.S. GAAP financial measures, and they are not necessarily
standardized or comparable to similarly titled measures used by
other companies.
|
Three months ended |
|
Twelve months ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
2019 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Total operating expenses |
$ |
2,127 |
|
|
$ |
1,861 |
|
|
$ |
2,992 |
|
|
$ |
8,929 |
|
|
$ |
12,497 |
|
Restructuring benefit
(credits) |
47 |
|
|
19 |
|
|
(157 |
) |
|
(196 |
) |
|
(111 |
) |
Operating expenses, excluding restructuring charges |
$ |
2,174 |
|
|
$ |
1,880 |
|
|
$ |
2,835 |
|
|
$ |
8,733 |
|
|
$ |
12,386 |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Twelve months ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
2019 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Net loss |
$ |
(1,308 |
) |
|
$ |
(946 |
) |
|
$ |
(2,997 |
) |
|
$ |
(7,373 |
) |
|
$ |
(9,111 |
) |
Restructuring expenses |
47 |
|
|
19 |
|
|
(157 |
) |
|
(196 |
) |
|
(111 |
) |
Net loss, excluding restructuring charges |
(1,355 |
) |
|
(965 |
) |
|
(2,840 |
) |
|
(7,177 |
) |
|
(9,000 |
) |
Interest |
79 |
|
|
67 |
|
|
4 |
|
|
215 |
|
|
8 |
|
Loan fee amortization |
30 |
|
|
27 |
|
|
9 |
|
|
102 |
|
|
9 |
|
Income tax expense |
10 |
|
|
— |
|
|
11 |
|
|
10 |
|
|
11 |
|
Depreciation |
49 |
|
|
77 |
|
|
123 |
|
|
326 |
|
|
522 |
|
Stock-based compensation |
59 |
|
|
34 |
|
|
202 |
|
|
616 |
|
|
908 |
|
Severance and benefits |
2 |
|
|
— |
|
|
10 |
|
|
2 |
|
|
335 |
|
Adjusted EBITDA |
$ |
(1,126 |
) |
|
$ |
(760 |
) |
|
$ |
(2,481 |
) |
|
$ |
(5,906 |
) |
|
$ |
(7,207 |
) |
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