[Filing Information](index=1&type=section&id=Filing%20Information) This section details the registrant's identity, stock listing, and company classification - The registrant is **LIGHTPATH TECHNOLOGIES, INC.**, incorporated in Delaware, with its **Class A Common Stock** (LPTH) registered on The Nasdaq Stock Market, LLC[2](index=2&type=chunk)[4](index=4&type=chunk) - The company is classified as a **Smaller reporting company** and a **Non-accelerated filer**[7](index=7&type=chunk) - As of May 3, 2021, there were **26,565,926** shares of **Class A Common Stock**, **$0.01** par value, outstanding[9](index=9&type=chunk) [CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS](index=4&type=section&id=Cautionary%20Note%20Concerning%20Forward-Looking%20Statements) This section highlights the inherent risks and uncertainties associated with forward-looking statements in the report - This section outlines forward-looking statements in the report, which are subject to risks and uncertainties, including those related to the continued duration and scope of the COVID-19 pandemic, raw material and component availability, government actions, global economic conditions, and the company's ability to sustain profitable sales growth and implement business initiatives[13](index=13&type=chunk) [PART I. FINANCIAL INFORMATION](index=5&type=section&id=Part%20I%20Financial%20Information) This section presents the company's unaudited condensed consolidated financial statements and management's analysis [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including core financial statements and explanatory notes [Unaudited Condensed Consolidated Balance Sheets](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's financial position, including assets, liabilities, and equity Condensed Consolidated Balance Sheet Highlights | Metric | March 31, 2021 | June 30, 2020 | | :-------------------------------- | :------------- | :------------ | | Total Assets | $48,708,471 | $47,574,918 | | Total Liabilities | $12,718,235 | $13,007,977 | | Total Stockholders' Equity | $35,990,236 | $34,566,941 | [Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This section details the company's financial performance, including revenue, gross margin, and net income or loss Key Income Statement Metrics (Three Months Ended March 31) | Metric | 2021 | 2020 | Change (YoY) | | :-------------------------------- | :----------- | :----------- | :----------- | | Revenue, net | $10,701,362 | $8,708,981 | +23% | | Gross margin | $3,903,757 | $4,012,176 | -3% | | Operating income | $166,657 | $1,062,812 | -84% | | Net income (loss) | $(222,564) | $816,017 | -127% | | Earnings (loss) per common share (basic) | $(0.01) | $0.03 | -133% | Key Income Statement Metrics (Nine Months Ended March 31) | Metric | 2021 | 2020 | Change (YoY) | | :-------------------------------- | :----------- | :----------- | :----------- | | Revenue, net | $30,132,505 | $25,860,823 | +17% | | Gross margin | $11,384,285 | $10,332,274 | +10% | | Operating income | $901,111 | $1,507,366 | -40% | | Net income (loss) | $(272,041) | $209,977 | -230% | | Earnings (loss) per common share (basic) | $(0.01) | $0.01 | -200% | [Unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Stockholders'%20Equity) This section outlines the changes in the company's stockholders' equity over the reporting period Stockholders' Equity Changes (June 30, 2020 to March 31, 2021) | Metric | June 30, 2020 | March 31, 2021 | Change | | :-------------------------------- | :------------ | :------------- | :----- | | Class A Common Stock (Shares) | 25,891,885 | 26,565,926 | +674,041 | | Class A Common Stock (Amount) | $258,919 | $265,659 | +$6,740 | | Additional Paid-in Capital | $230,634,056 | $231,243,062 | +$609,006 | | Accumulated Other Comprehensive Income | $735,892 | $1,815,482 | +$1,079,590 | | Accumulated Deficit | $(197,061,926) | $(197,333,967) | -$$272,041 | | Total Stockholders' Equity | $34,566,941 | $35,990,236 | +$1,423,295 | [Unaudited Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section summarizes the company's cash inflows and outflows from operating, investing, and financing activities Cash Flow Summary (Nine Months Ended March 31) | Cash Flow Activity | 2021 | 2020 | Change | | :-------------------------------- | :----------- | :----------- | :----- | | Net cash provided by operating activities | $3,076,235 | $1,869,783 | +$1,206,452 | | Net cash used in investing activities | $(2,721,567) | $(1,318,035) | -$$1,403,532 | | Net cash used in financing activities | $(312,700) | $(727,039) | +$414,339 | | Change in cash and cash equivalents | $553,311 | $(222,988) | +$776,299 | | Cash and cash equivalents, end of period | $5,940,699 | $4,381,713 | +$1,558,986 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures for the unaudited condensed consolidated financial statements - The unaudited Condensed Consolidated Financial Statements are prepared in accordance with Article **8** of Regulation S-X and should be read with the Annual Report on Form **10-K** for the fiscal year ended June **30**, **2020**. **No material changes** to significant accounting policies occurred during the nine months ended March **31**, **2021**[27](index=27&type=chunk)[29](index=29&type=chunk) Revenue by Product Group (Three Months Ended March 31) | Product Group | 2021 | 2020 | | :---------------- | :----------- | :----------- | | PMO | $3,904,857 | $3,851,518 | | Infrared Products | $6,462,527 | $4,296,111 | | Specialty Products | $333,978 | $561,352 | | Total revenue | $10,701,362 | $8,708,981 | Inventory Components (March 31, 2021 vs June 30, 2020) | Component | March 31, 2021 | June 30, 2020 | | :-------------------- | :------------- | :------------ | | Raw materials | $3,640,273 | $3,876,955 | | Work in process | $2,971,839 | $2,989,070 | | Finished goods | $3,395,230 | $3,134,800 | | Allowance for obsolescence | $(1,124,059) | $(1,016,343) | | Total inventories, net | $8,883,283 | $8,984,482 | Income Tax Provision and Effective Rate (Nine Months Ended March 31) | Metric | 2021 | 2020 | | :---------------------- | :------- | :------- | | Income before income taxes | $711,545 | $883,533 | | Income tax provision | $983,586 | $673,556 | | Effective income tax rate | **138%** | **76%** | - Income tax expense was primarily related to China operations, including **$400,000** in Chinese withholding taxes on **$4 million** of intercompany dividends declared by **LPOIZ** in the first nine months of fiscal **2021**[42](index=42&type=chunk)[46](index=46&type=chunk) Stock-Based Compensation Expense (Nine Months Ended March 31) | Type | 2021 | 2020 | | :---------------- | :------- | :------- | | Stock options | $51,277 | $(15,330) | | RSUs | $391,800 | $261,616 | | Total | $443,077 | $246,286 | Earnings (Loss) Per Common Share (Nine Months Ended March 31) | Metric | 2021 | 2020 | | :-------------------------------- | :------- | :------- | | Net income (loss) | $(272,041) | $209,977 | | Basic EPS | $(0.01) | $0.01 | | Diluted EPS | $(0.01) | $0.01 | - Loans payable primarily include the **BankUnited Term Loan** (**$4.7 million** outstanding), **BankUnited Revolving Line** (**$300,000** outstanding), and a **subordinated Equipment Loan** (**$247,000** outstanding) as of March **31**, **2021**. The company was in **compliance with all loan covenants**[121](index=121&type=chunk)[71](index=71&type=chunk) - Over **50%** of the company's **$5.9 million** cash and cash equivalents at March **31**, **2021**, was held by foreign subsidiaries in China and Latvia. **LPOIZ** had approximately **$6.6 million available for repatriation**[76](index=76&type=chunk)[118](index=118&type=chunk)[120](index=120&type=chunk) - In April **2021**, the company terminated several employees of its China subsidiaries due to **malfeasance**, incurring **$194,000** in investigation expenses and agreeing to **$470,000** in severance. **Short-term adverse impacts** on domestic sales in China are anticipated[81](index=81&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's analysis of financial condition, operations, and liquidity, covering strategy and key performance indicators [Potential Impact of COVID-19](index=22&type=section&id=Potential%20Impact%20of%20COVID-19) This section assesses the operational and financial impacts of the COVID-19 pandemic on the company - The company's manufacturing facilities have continued to operate substantially as normal, with some non-manufacturing employees working remotely. **No significant direct negative impact** has been experienced, but future effects on demand, operations, cash flows, and financial position remain uncertain due to evolving economic conditions[85](index=85&type=chunk) - There has been **increased demand** for **thermal imaging assemblies** for fever detection applications in response to the pandemic[85](index=85&type=chunk) [Introduction (Company Overview)](index=22&type=section&id=Introduction%20(Company%20Overview)) This section provides an overview of the company's global operations and specialized optical product offerings - LightPath is a global company with major facilities in the United States, China, and Latvia, specializing in precision molded optics, thermal imaging optics, custom designed optics, and the design and manufacturing of optical assemblies and subsystems[86](index=86&type=chunk)[87](index=87&type=chunk) [Subsidiaries](index=23&type=section&id=Subsidiaries) This section identifies and describes the company's key operational subsidiaries - Key subsidiaries include LPOI (sales and support in China), **LPOIZ** (primary manufacturing in China), and ISP Optics Latvia, SIA (manufacturer of high precision infrared optics in Latvia). The ISP facility in Irvington, NY was relocated to Orlando, FL and Riga, Latvia in June **2019**[88](index=88&type=chunk)[89](index=89&type=chunk) [Growth Strategy](index=23&type=section&id=Growth%20Strategy) This section outlines the company's strategic shift towards providing complete optical solutions and OEM partnerships - The company is shifting its strategic focus from **component manufacturing** to offering **complete optical solutions** and becoming a **partner of choice for OEM customers** integrating optics. This involves aligning resources, processes, and developing capabilities to support this strategy[91](index=91&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk) [Product Groups and Markets](index=23&type=section&id=Product%20Groups%20and%20Markets) This section categorizes the company's products and identifies its target markets and market size - The business is organized into three product groups: Precision Molded Optics (PMO), Infrared Products, and Specialty Products (value-added products and NRE). These serve major markets including defense and security, optical systems, datacom/telecom, information technology, life sciences, machine vision, and production technology[95](index=95&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk)[99](index=99&type=chunk) - The company estimates a **$2.0 billion** market for its current products and capabilities within the larger **$401 billion** photonics market (excluding displays and photovoltaic), which is growing at a **7%** compound annual growth rate[100](index=100&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance, including revenue, gross margin, and expense trends Revenue by Product Group (Three Months Ended March 31) | Product Group | 2021 | 2020 | Change (YoY) | | :---------------- | :----------- | :----------- | :----------- | | PMO | $3,904,857 | $3,851,518 | +1% | | Infrared Products | $6,462,527 | $4,296,111 | +50% | | Specialty Products | $333,978 | $561,352 | -41% | | Total Revenue | $10,701,362 | $8,708,981 | +23% | Revenue by Product Group (Nine Months Ended March 31) | Product Group | 2021 | 2020 | Change (YoY) | | :---------------- | :----------- | :----------- | :----------- | | PMO | $12,940,919 | $10,746,525 | +20% | | Infrared Products | $15,995,133 | $13,259,610 | +21% | | Specialty Products | $1,196,453 | $1,854,688 | -35% | | Total Revenue | $30,132,505 | $25,860,823 | +17% | - Gross margin as a percentage of revenue decreased to **36%** (Q3 **2021**) from **46%** (Q3 **2020**) due to product mix shift towards lower-margin infrared products (**60%** of revenue) and **lower yields** in new infrared products, particularly BD6 coatings, experiencing start-up inefficiencies in mass production[104](index=104&type=chunk) SG&A Costs (Nine Months Ended March 31) | Metric | 2021 | 2020 | Change (YoY) | | :------------- | :----------- | :----------- | :----------- | | SG&A costs | $8,009,484 | $6,796,536 | +18% | - SG&A costs increased due to **$400,000** in additional compensation to the former CEO, **$194,000** in legal/consulting fees for China employee terminations, and **$84,000** in stock compensation for a retiring director[106](index=106&type=chunk)[108](index=108&type=chunk) New Product Development Costs (Nine Months Ended March 31) | Metric | 2021 | 2020 | Change (YoY) | | :-------------------------- | :------- | :------- | :----------- | | New product development costs | $1,620,927 | $1,309,383 | +24% | - **Net loss** for Q3 **2021** was **$223,000** (EPS **$(0.01)**) compared to **net income** of **$816,000** (EPS **$0.03**) in Q3 **2020**, primarily due to increased SG&A and new product development costs, and lower gross margin percentage[115](index=115&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's cash position, working capital, and capital expenditure activities Liquidity Position (March 31, 2021) | Metric | Amount | | :-------------------- | :----------- | | Working Capital | **$14.0 million** | | Cash and Cash Equivalents | **$5.9 million** | - Over **50%** of cash and cash equivalents are held by foreign subsidiaries. The company repatriated **$3 million** from **LPOIZ** in the first nine months of fiscal **2021**, with **$6.6 million still available for repatriation** from **LPOIZ**[118](index=118&type=chunk)[120](index=120&type=chunk) - **Cash flow from operations** improved to **$3.1 million** for the first nine months of fiscal **2021**, up from **$1.9 million** in the prior year, due to improved receivables and inventory management. Capital expenditures increased to **$2.7 million**, primarily for infrared coating, lens pressing, and dicing capacity[124](index=124&type=chunk)[125](index=125&type=chunk) [Contractual Obligations and Commitments](index=29&type=section&id=Contractual%20Obligations%20and%20Commitments) This section details the company's principal contractual obligations and contingent liabilities - Principal commitments as of March **31**, **2021**, consisted of obligations under operating and finance leases, and debt agreements. **No material changes** occurred in contractual cash obligations or contingent liabilities during the first nine months of fiscal **2021**[127](index=127&type=chunk) [Off-Balance Sheet Arrangements](index=29&type=section&id=Off-Balance%20Sheet%20Arrangements) This section confirms the absence of off-balance sheet arrangements or variable interest entities - The company does not engage in any activities involving variable interest entities or **off-balance sheet arrangements**[128](index=128&type=chunk) [Critical Accounting Policies and Estimates](index=29&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section confirms the consistency of critical accounting policies and estimates with prior disclosures - There have been **no material changes** to critical accounting policies and estimates during the nine months ended March **31**, **2021**, from those disclosed in the Annual Report on Form **10-K** for the year ended June **30**, **2020**[129](index=129&type=chunk) [How We Operate](index=30&type=section&id=How%20We%20Operate) This section describes the company's sales model, focusing on ad-hoc orders versus design-win annuity streams - The company operates with two basic sales types: ad-hoc purchase orders for standard products ('turns' business) and customer product development leading to 'design wins' and annuity revenue streams. A key objective is to convert more business to the **design win and annuity model**[130](index=130&type=chunk) [Our Key Performance Indicators](index=30&type=section&id=Our%20Key%20Performance%20Indicators) This section presents key operational metrics, including sales backlog, revenue, and unit changes by product group Total Sales Backlog | Quarter End | Backlog ($000) | Change From Prior Year | Change From Prior Quarter | | :---------- | :------------- | :--------------------- | :------------------------ | | Q3 2020 | $22,772 | 26% | 1% | | Q4 2020 | $21,908 | 21% | -4% | | Q1 2020 | $20,866 | -5% | -5% | | Q2 2021 | $23,835 | 9% | 14% | | Q3 2021 | $19,498 | -11% | -18% | - **Total backlog** decreased by **14%** year-over-year to **$19.5 million** at March **31**, **2021**, primarily due to record high sales and fewer new orders from a large telecommunications customer, which is believed to be a temporary slowdown related to **5G** rollout[137](index=137&type=chunk) Revenue and Unit Changes by Product Group (Three Months Ended March 31) | Product Group | Revenue % Change (YoY) | Units % Change (YoY) | | :---------------- | :--------------------- | :------------------- | | PMO | +1% | -15% | | Infrared Products | +50% | +85% | | Specialty Products | -41% | -36% | | Total | +23% | -5% | Revenue and Unit Changes by Product Group (Nine Months Ended March 31) | Product Group | Revenue % Change (YoY) | Units % Change (YoY) | | :---------------- | :--------------------- | :------------------- | | PMO | +20% | +31% | | Infrared Products | +21% | +95% | | Specialty Products | -35% | -28% | | Total | +17% | +37% | - For the three months, **PMO average selling prices** increased by **19%** despite a **15%** unit decrease, while **Infrared average selling prices** decreased **19%** with an **85%** unit increase, driven by higher volume, lower-priced molded BD6 products[142](index=142&type=chunk)[143](index=143&type=chunk) - Management reviews non-financial indicators like **sales opportunity pipeline**, **on-time delivery**, **shippable output**, and **production yield rates** to guide tactical operating actions[149](index=149&type=chunk) [Non-GAAP Financial Measures](index=33&type=section&id=Non-GAAP%20Financial%20Measures) This section defines and reconciles non-GAAP financial measures like EBITDA, used for performance evaluation - **EBITDA** is a non-GAAP financial measure used by management, lenders, and investors to evaluate **core operating performance** by excluding **net interest expense**, **income tax expense/benefit**, **depreciation**, and **amortization**[151](index=151&type=chunk) EBITDA Performance (Three Months Ended March 31) | Metric | 2021 | 2020 | Change (YoY) | | :------------- | :----------- | :----------- | :----------- | | EBITDA | $1,055,373 | $1,931,945 | -45% | | % of revenue | 10% | 22% | -12 ppts | EBITDA Performance (Nine Months Ended March 31) | Metric | 2021 | 2020 | Change (YoY) | | :------------- | :----------- | :----------- | :----------- | | EBITDA | $3,486,508 | $3,744,110 | -7% | | % of revenue | 12% | 14% | -2 ppts | - The decrease in **EBITDA** for both periods was primarily attributable to increased SG&A costs (including expenses related to director and personnel matters) and increased new product development costs[151](index=151&type=chunk)[152](index=152&type=chunk) [Item 4. Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls were effective, with no material changes in internal control over financial reporting - The CEO and CFO concluded that **disclosure controls and procedures** were **effective as of March 31, 2021**[153](index=153&type=chunk)[154](index=154&type=chunk) - **No material changes** in **internal control over financial reporting** occurred during the fiscal quarter ended March **31**, **2021**[155](index=155&type=chunk) [PART II OTHER INFORMATION](index=35&type=section&id=Part%20II%20Other%20Information) This section covers other information not included in the financial statements, such as legal proceedings and exhibits [Item 1. Legal Proceedings](index=35&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no legal proceedings for the period - **None**[156](index=156&type=chunk) [Item 1A. Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) The company reported no new risk factors for the period - **None**[156](index=156&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=35&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or use of proceeds for the period - **None**[157](index=157&type=chunk) [Item 3. Defaults Upon Senior Securities](index=35&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities for the period - **None**[157](index=157&type=chunk) [Item 4. Mine Safety Disclosures](index=35&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company reported no mine safety disclosures for the period - **None**[157](index=157&type=chunk) [Item 5. Other Information](index=35&type=section&id=Item%205.%20Other%20Information) The company reported no other information for the period - **None**[157](index=157&type=chunk) [Item 6. Exhibits](index=35&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed, including corporate governance documents and certifications - The exhibits include various **corporate governance documents** such as Certificates of Incorporation, Amendments, and Bylaws, along with **certifications from the CEO and CFO**[159](index=159&type=chunk)[160](index=160&type=chunk) [SIGNATURES](index=38&type=section&id=Signatures) This section contains the official signatures of the company's President, CEO, and CFO - The report was **signed on May 6, 2021**, by Shmuel Rubin, President and Chief Executive Officer, and Donald O. Retreage, Jr., Chief Financial Officer[165](index=165&type=chunk)

[Cautionary Note Concerning Forward-Looking Statements](index=4&type=section&id=Cautionary%20Note%20Concerning%20Forward-Looking%20Statements) The report contains forward-looking statements subject to numerous risks and uncertainties that could cause actual future results to differ materially - The report contains forward-looking statements regarding future capital expenditures, growth, product development, sales, business strategy, and the expected effects of the COVID-19 pandemic[12](index=12&type=chunk) - These statements are based on current expectations and assumptions but are subject to numerous risks and uncertainties, many beyond the company's control, which could cause actual future results to differ materially[12](index=12&type=chunk) Part I Financial Information [Item 1. Financial Statements](index=5&type=section&id=Item%201%20Financial%20Statements) This section presents unaudited condensed consolidated financial statements and detailed notes on accounting policies, revenue, assets, liabilities, equity, and contingencies [Unaudited Condensed Consolidated Balance Sheets](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity at specific dates Unaudited Condensed Consolidated Balance Sheets | Metric | December 31, 2020 ($) | June 30, 2020 ($) | | :-------------------------- | :------------------ | :------------------ | | Cash and cash equivalents | $5,306,243 | $5,387,388 | | Total current assets | $22,188,715 | $21,257,828 | | Total assets | $49,896,607 | $47,574,918 | | Total current liabilities | $8,132,271 | $7,403,411 | | Total liabilities | $13,543,580 | $13,007,977 | | Total stockholders' equity | $36,353,027 | $34,566,941 | - Total assets increased by approximately **$2.3 million**, and total stockholders' equity increased by approximately **$1.8 million** from June 30, 2020, to December 31, 2020[15](index=15&type=chunk) [Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) This statement details the company's revenues, expenses, and net income or loss over specific reporting periods Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) | Metric | Three Months Ended Dec 31, 2020 ($) | Three Months Ended Dec 31, 2019 ($) | Six Months Ended Dec 31, 2020 ($) | Six Months Ended Dec 31, 2019 ($) | | :-------------------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Revenue, net | $9,922,171 | $9,599,912 | $19,431,143 | $17,151,842 | | Gross margin | $3,630,336 | $3,929,280 | $7,480,528 | $6,320,098 | | Operating income | $56,462 | $1,057,446 | $734,454 | $444,554 | | Net income (loss) | $(146,545) | $769,117 | $(49,477) | $(606,040) | | Earnings (loss) per common share (basic) | $(0.01) | $0.03 | $(0.00) | $(0.02) | - Revenue increased by **3%** for the three months and **13%** for the six months ended December 31, 2020, compared to the prior year[17](index=17&type=chunk) - The company reported a net loss of **$146,545** for the three months ended December 31, 2020, a significant decrease from net income of **$769,117** in the prior year period[17](index=17&type=chunk) [Unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Stockholders%27%20Equity) This statement tracks changes in the company's equity, including stock issuance, compensation, and net income impacts Unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity | Item | Balances at June 30, 2020 ($) | Balances at December 31, 2020 ($) | | :------------------------------------ | :-------------------------- | :---------------------------- | | Total Stockholders' Equity | $34,566,941 | $36,353,027 | | Issuance of common stock (ESPP) | N/A | $11,009 | | Exercise of stock options & RSUs, net | N/A | $128,834 | | Stock-based compensation | N/A | $243,016 | | Foreign currency translation adjustment | N/A | $1,452,704 | | Net income (loss) | N/A | $(49,477) | - Total stockholders' equity increased by approximately **$1.79 million** from June 30, 2020, to December 31, 2020, driven by foreign currency translation adjustments and stock-based compensation[20](index=20&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This statement categorizes cash movements into operating, investing, and financing activities, showing overall cash changes Unaudited Condensed Consolidated Statements of Cash Flows | Metric | Six Months Ended Dec 31, 2020 ($) | Six Months Ended Dec 31, 2019 ($) | | :------------------------------------ | :---------------------------- | :---------------------------- | | Net cash provided by operating activities | $1,542,035 | $938,471 | | Net cash used in investing activities | $(2,160,710) | $(973,654) | | Net cash used in financing activities | $(116,369) | $(488,733) | | Change in cash and cash equivalents | $(81,145) | $(327,094) | | Cash and cash equivalents, end of period | $5,306,243 | $4,277,607 | - Net cash provided by operating activities increased by **64%** to **$1.54 million** for the six months ended December 31, 2020, compared to the prior year[23](index=23&type=chunk) - Net cash used in investing activities more than doubled to **$2.16 million**, primarily due to increased purchases of property and equipment[23](index=23&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the condensed consolidated financial statements [1. Basis of Presentation](index=9&type=section&id=1.%20Basis%20of%20Presentation) This note outlines the accounting principles and consolidation methods used in preparing the financial statements - The unaudited Condensed Consolidated Financial Statements are prepared in accordance with Regulation S-X and should be read in conjunction with the Annual Report on Form 10-K for the fiscal year ended June 30, 2020[27](index=27&type=chunk) - All significant intercompany balances and transactions have been eliminated in consolidation[28](index=28&type=chunk) [2. Significant Accounting Policies](index=9&type=section&id=2.%20Significant%20Accounting%20Policies) This note details the key accounting policies and estimates applied in the financial reporting process - There have been no material changes to the company's significant accounting policies during the six months ended December 31, 2020[29](index=29&type=chunk) - Management makes estimates and assumptions that affect reported amounts in the financial statements, which could change in the future[30](index=30&type=chunk) [3. Revenue](index=9&type=section&id=3.%20Revenue) This note provides a breakdown of revenue by product group and explains the revenue recognition policy - Revenue is derived primarily from the sale of optical components and assemblies, recognized upon transfer of control to customers[31](index=31&type=chunk)[32](index=32&type=chunk) Revenue by Product Group | Product Group | Three Months Ended Dec 31, 2020 ($) | Three Months Ended Dec 31, 2019 ($) | Six Months Ended Dec 31, 2020 ($) | Six Months Ended Dec 31, 2019 ($) | | :---------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | PMO | $4,742,459 | $3,710,549 | $9,036,062 | $6,895,007 | | Infrared Products | $4,808,102 | $5,003,874 | $9,532,606 | $8,963,499 | | Specialty Products | $371,610 | $885,489 | $862,475 | $1,293,336 | | **Total revenue** | **$9,922,171** | **$9,599,912** | **$19,431,143** | **$17,151,842** | - PMO revenue increased by **28%** (three months) and **31%** (six months), while Specialty Products revenue decreased by **58%** (three months) and **33%** (six months) year-over-year[34](index=34&type=chunk) [4. Inventories](index=10&type=section&id=4.%20Inventories) This note details the composition of inventories and changes in their net value over the period Inventories | Component | December 31, 2020 ($) | June 30, 2020 ($) | | :---------------------- | :------------------ | :------------------ | | Raw materials | $4,094,767 | $3,876,955 | | Work in process | $3,390,968 | $2,989,070 | | Finished goods | $3,302,822 | $3,134,800 | | Allowance for obsolescence | $(1,095,280) | $(1,016,343) | | **Total inventories, net** | **$9,693,277** | **$8,984,482** | - Net inventories increased by approximately **$708,795** from June 30, 2020, to December 31, 2020[35](index=35&type=chunk) [5. Property and Equipment](index=11&type=section&id=5.%20Property%20and%20Equipment) This note outlines the company's property and equipment, including manufacturing assets and construction in progress Property and Equipment | Category | December 31, 2020 ($) | June 30, 2020 ($) | | :-------------------------- | :------------------ | :------------------ | | Manufacturing equipment | $20,870,729 | $18,444,448 | | Construction in progress | $1,597,166 | $1,274,880 | | **Total property and equipment, net** | **$13,631,399** | **$11,799,061** | - Net property and equipment increased by approximately **$1.83 million**, primarily due to investments in manufacturing equipment and construction in progress[37](index=37&type=chunk) [6. Goodwill and Intangible Assets](index=11&type=section&id=6.%20Goodwill%20and%20Intangible%20Assets) This note details the carrying values of goodwill and other intangible assets, including amortization impacts - The net carrying value of goodwill remained unchanged during the six months ended December 31, 2020[38](index=38&type=chunk) Goodwill and Intangible Assets | Asset | December 31, 2020 ($) | June 30, 2020 ($) | | :---------------------- | :------------------ | :------------------ | | Customer relationships | $3,590,000 | $3,590,000 | | Trade secrets | $3,272,000 | $3,272,000 | | Trademarks | $3,814,000 | $3,814,000 | | Less accumulated amortization | $(4,530,577) | $(3,968,036) | | **Total intangible assets, net** | **$6,145,423** | **$6,707,964** | - Total intangible assets, net, decreased by approximately **$562,541** due to accumulated amortization[39](index=39&type=chunk) [7. Accounts Payable](index=11&type=section&id=7.%20Accounts%20Payable) This note provides details on the company's accounts payable, including specific accrued liabilities - Accounts payable included approximately **$91,000** of earned but unpaid Board of Directors' fees at both December 31, 2020, and June 30, 2020[40](index=40&type=chunk) [8. Income Taxes](index=12&type=section&id=8.%20Income%20Taxes) This note explains the company's income tax provision, effective tax rates, and significant tax adjustments Income Taxes | Metric | Three Months Ended Dec 31, 2020 ($) | Three Months Ended Dec 31, 2019 ($) | Six Months Ended Dec 31, 2020 ($) | Six Months Ended Dec 31, 2019 ($) | | :-------------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Income (loss) before taxes | $94,567 | $1,090,986 | $626,275 | $(135,853) | | Income tax provision | $241,112 | $321,869 | $675,752 | $470,187 | | Effective income tax rate | 255% | 30% | 108% | -346% | - Income tax expense for the six months ended December 31, 2020, included **$300,000** in Chinese withholding taxes accrued on a **$3 million** intercompany dividend from LPOIZ[42](index=42&type=chunk)[46](index=46&type=chunk) - The company changed its intent regarding the permanent reinvestment of foreign earnings, now planning to repatriate a portion of historical earnings from foreign subsidiaries and accruing related withholding taxes[47](index=47&type=chunk) [9. Stock-Based Compensation](index=13&type=section&id=9.%20Stock-Based%20Compensation) This note details the expense recognized for stock options and restricted stock units, and future compensation costs Stock-Based Compensation | Category | Six Months Ended Dec 31, 2020 ($) | Six Months Ended Dec 31, 2019 ($) | | :-------------------------- | :---------------------------- | :---------------------------- | | Stock options | $34,241 | $5,307 | | RSUs | $208,775 | $173,082 | | **Total** | **$243,016** | **$178,389** | - Total stock-based compensation expense increased by approximately **$64,627** (**36%**) for the six months ended December 31, 2020, primarily due to RSU awards[51](index=51&type=chunk) - As of December 31, 2020, approximately **$1.1 million** of total unrecognized compensation cost related to non-vested share-based compensation arrangements is expected to be recognized through fiscal year 2024[56](index=56&type=chunk) [10. Earnings (Loss) Per Share](index=15&type=section&id=10.%20Earnings%20%28Loss%29%20Per%20Share) This note presents basic and diluted earnings per share, explaining the calculation and anti-dilutive effects Earnings (Loss) Per Share | Metric | Three Months Ended Dec 31, 2020 ($) | Three Months Ended Dec 31, 2019 ($) | Six Months Ended Dec 31, 2020 ($) | Six Months Ended Dec 31, 2019 ($) | | :-------------------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Net income (loss) | $(146,545) | $769,117 | $(49,477) | $(606,040) | | Basic EPS | $(0.01) | $0.03 | $(0.00) | $(0.02) | | Diluted EPS | $(0.01) | $0.03 | $(0.00) | $(0.02) | - The company reported a basic and diluted loss per share of **$0.01** for the three months and **$0.00** for the six months ended December 31, 2020[57](index=57&type=chunk) - Potential dilutive shares totaling **2.78 million** (3 months) and **2.96 million** (6 months) were excluded from diluted EPS calculations due to their anti-dilutive effect[57](index=57&type=chunk) [11. Leases](index=15&type=section&id=11.%20Leases) This note describes the company's operating and finance leases, including associated costs and future payment obligations - The company's leases primarily consist of operating leases for facilities in Florida, Latvia, and China, and finance leases for certain equipment[58](index=58&type=chunk) Lease Costs | Metric | Three Months Ended Dec 31, 2020 ($) | Three Months Ended Dec 31, 2019 ($) | Six Months Ended Dec 31, 2020 ($) | Six Months Ended Dec 31, 2019 ($) | | :---------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Operating lease cost | $173,437 | $172,102 | $340,411 | $336,973 | | Finance lease cost | $58,786 | $106,488 | $137,479 | $215,083 | | **Total lease cost** | **$232,223** | **$278,590** | **$477,890** | **$552,056** | Future Lease Payments | Fiscal Year Ending | Finance Leases ($) | Operating Leases ($) | | :----------------------- | :------------- | :--------------- | | June 30, 2021 (remaining) | $160,648 | $446,769 | | June 30, 2022 | $231,783 | $835,454 | | June 30, 2023 | $59,647 | $244,026 | | June 30, 2024 | $11,811 | $123,683 | | June 30, 2025 and later | — | $123,683 | | **Present value of lease liabilities** | **$421,143** | **$1,735,382** | [12. Loans Payable](index=17&type=section&id=12.%20Loans%20Payable) This note details the company's debt obligations, including term loans, revolving lines, and equipment loans, and covenant compliance - Loans payable primarily consist of the BankUnited Term Loan (**$4.8 million** outstanding), a BankUnited Revolving Line (**$300,000** outstanding), and a new subordinated Equipment Loan (**$272,000** outstanding) as of December 31, 2020[63](index=63&type=chunk)[119](index=119&type=chunk) - The company was in compliance with all loan covenants, including fixed charge coverage ratio and total leverage ratio, as of December 31, 2020[70](index=70&type=chunk)[121](index=121&type=chunk) Future Loan Payments | Fiscal Year Ending | BankUnited Term Loan ($) | BankUnited Revolver ($) | Equipment Loan ($) | Total Payments ($) | | :----------------------- | :------------------- | :------------------ | :------------- | :------------- | | June 30, 2021 (remaining) | $290,676 | $300,000 | $27,172 | $608,562 | | June 30, 2022 | $581,350 | - | $54,343 | $617,121 | | June 30, 2023 | $581,350 | - | $54,343 | $617,121 | | June 30, 2024 | $3,342,762 | - | $54,343 | $3,384,724 | | After June 30, 2024 | - | - | $81,516 | $81,516 | | **Total payments** | **$4,796,138** | **$300,000** | **$271,717** | **$5,309,044** | [13. Foreign Operations](index=19&type=section&id=13.%20Foreign%20Operations) This note provides information on the company's foreign subsidiaries, including cash holdings and assets by country - Over **50%** of the company's **$5.3 million** cash and cash equivalents at December 31, 2020, was held by foreign subsidiaries in China and Latvia[75](index=75&type=chunk)[116](index=116&type=chunk) - LPOIZ (China) had approximately **$7.6 million** available for repatriation as of December 31, 2020[75](index=75&type=chunk)[118](index=118&type=chunk) Foreign Operations Assets | Country | December 31, 2020 Assets ($) | June 30, 2020 Assets ($) | December 31, 2020 Net Assets ($) | June 30, 2020 Net Assets ($) | | :------ | :----------------------- | :------------------- | :--------------------------- | :------------------------- | | China | $20.9 million | $19.0 million | $17.8 million | $16.2 million | | Latvia | $9.7 million | $9.8 million | $8.7 million | $8.2 million | [14. Contingencies](index=19&type=section&id=14.%20Contingencies) This note discusses potential future obligations and the impact of unforeseen events, such as the COVID-19 pandemic [COVID-19](index=20&type=section&id=COVID-19) This section addresses the current and potential future impacts of the COVID-19 pandemic on the company's operations - The company has not experienced any significant direct negative impact of COVID-19 to its business to date[80](index=80&type=chunk) - The evolving nature of the COVID-19 pandemic makes it difficult to estimate its future effects on the company's results of operations, financial condition, or liquidity[80](index=80&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance, liquidity, capital resources, and strategic outlook, including non-GAAP measures [Results of Operations](index=23&type=section&id=Results%20of%20Operations) This section analyzes the company's revenue, cost of sales, operating expenses, and net income trends over the reporting periods [Revenue](index=23&type=section&id=Revenue) This section analyzes revenue performance by product group, highlighting growth drivers and declines Revenue Performance | Product Group | 3 Months Ended Dec 31, 2020 vs 2019 | 6 Months Ended Dec 31, 2020 vs 2019 | | :---------------- | :---------------------------------- | :---------------------------------- | | PMO | +28% (+$1.0M) | +31% (+$2.1M) | | Infrared Products | -4% (-$196K) | +6% (+$569K) | | Specialty Products | -58% (-$514K) | -33% (-$431K) | | **Total Revenue** | **+3% (+$322K)** | **+13% (+$2.3M)** | - PMO revenue growth was driven by increased sales to telecommunications, defense, and industrial markets, as well as catalog and distribution channels[100](index=100&type=chunk) - Infrared product growth for the six-month period was attributed to molded infrared products, including new BD6 material, and increased demand for fever detection and industrial applications[102](index=102&type=chunk) [Cost of Sales and Gross Margin](index=24&type=section&id=Cost%20of%20Sales%20and%20Gross%20Margin) This section examines the cost of goods sold and gross margin trends, identifying factors influencing profitability Cost of Sales and Gross Margin | Metric | 3 Months Ended Dec 31, 2020 ($) | 3 Months Ended Dec 31, 2019 ($) | 6 Months Ended Dec 31, 2020 ($) | 6 Months Ended Dec 31, 2019 ($) | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Gross margin | $3,630,336 | $3,929,280 | $7,480,528 | $6,320,098 | | Gross margin % of revenue | 37% | 41% | 38% | 37% | - The decrease in gross margin percentage for the three-month period was due to product mix, initial volume deliveries of new products, and yield issues with BD6 coatings[103](index=103&type=chunk) - The increase in gross margin percentage for the six-month period was primarily due to higher revenue and volumes in PMO and Infrared product groups, and the mitigation of prior year tariff impacts[104](index=104&type=chunk) [Selling, General and Administrative](index=24&type=section&id=Selling%2C%20General%20and%20Administrative) This section analyzes changes in selling, general, and administrative expenses, including personnel and consulting costs Selling, General and Administrative Costs | Metric | 3 Months Ended Dec 31, 2020 ($) | 3 Months Ended Dec 31, 2019 ($) | 6 Months Ended Dec 31, 2020 ($) | 6 Months Ended Dec 31, 2019 ($) | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | SG&A costs | $2,763,178 | $2,199,133 | $5,203,655 | $4,540,911 | - SG&A costs increased by **26%** (three months) and **15%** (six months), primarily due to a non-recurring **$400,000** compensation to the former CEO[105](index=105&type=chunk)[106](index=106&type=chunk) - Additional increases in SG&A were attributed to higher personnel-related costs from increased headcount and outside consulting services for operational improvements[105](index=105&type=chunk)[106](index=106&type=chunk) [New Product Development](index=25&type=section&id=New%20Product%20Development) This section discusses investments in new product development and their impact on engineering resources New Product Development Costs | Metric | 3 Months Ended Dec 31, 2020 ($) | 3 Months Ended Dec 31, 2019 ($) | 6 Months Ended Dec 31, 2020 ($) | 6 Months Ended Dec 31, 2019 ($) | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | New product development | $529,902 | $468,646 | $980,399 | $897,057 | - New product development costs increased by **13%** (three months) and **9%** (six months), driven by the addition of engineering employees to support optical design demand[107](index=107&type=chunk)[108](index=108&type=chunk) [Other Income (Expense)](index=25&type=section&id=Other%20Income%20%28Expense%29) This section reviews interest expense, foreign currency impacts, and other non-operating income or expenses Other Income (Expense) | Metric | 3 Months Ended Dec 31, 2020 ($) | 3 Months Ended Dec 31, 2019 ($) | 6 Months Ended Dec 31, 2020 ($) | 6 Months Ended Dec 31, 2019 ($) | | :-------------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Interest expense, net | $(55,147) | $(89,257) | $(113,696) | $(187,798) | | Other income (expense), net | $93,252 | $122,797 | $5,517 | $(392,609) | - Interest expense decreased due to lower interest rates and a **7%** reduction in total debt from December 31, 2019, to December 31, 2020[109](index=109&type=chunk) - Net foreign currency transaction gains were **$77,000** for the three months, while net losses were **$21,000** for the six months, a significant improvement from a **$376,000** loss in the prior six-month period[110](index=110&type=chunk) [Income Taxes](index=25&type=section&id=Income%20Taxes) This section details the income tax provision, including the impact of foreign withholding taxes and tax rate changes Income Tax Provision | Metric | 3 Months Ended Dec 31, 2020 ($) | 3 Months Ended Dec 31, 2019 ($) | 6 Months Ended Dec 31, 2020 ($) | 6 Months Ended Dec 31, 2019 ($) | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Income tax provision | $241,112 | $321,869 | $675,752 | $470,187 | - Income tax expense for the six months ended December 31, 2020, included **$300,000** in Chinese withholding taxes on intercompany dividends, compared to **$200,000** in the prior year[112](index=112&type=chunk) - Despite withholding taxes, the total income tax on repatriated earnings was lower due to LPOIZ's reduced Chinese income tax rate[112](index=112&type=chunk) [Net Income (Loss)](index=26&type=section&id=Net%20Income%20%28Loss%29) This section summarizes the factors contributing to the company's net income or loss and earnings per share Net Income (Loss) and EPS | Metric | 3 Months Ended Dec 31, 2020 ($) | 3 Months Ended Dec 31, 2019 ($) | 6 Months Ended Dec 31, 2020 ($) | 6 Months Ended Dec 31, 2019 ($) | | :-------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net income (loss) | $(146,545) | $769,117 | $(49,477) | $(606,040) | | Basic & Diluted EPS | $(0.01) | $0.03 | $(0.00) | $(0.02) | - The three-month net loss was primarily due to a **$1.0 million** decrease in operating income, influenced by lower gross margin and increased SG&A (including **$400,000** non-recurring CEO compensation) and new product development expenses[113](index=113&type=chunk) - The six-month net loss reduction was driven by a **$290,000** increase in operating income (from higher sales and gross margin) and a **$355,000** favorable difference in foreign exchange, partially offset by a **$206,000** unfavorable income tax provision[114](index=114&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to meet short-term obligations and fund operations, including cash flow and capital expenditures Liquidity and Capital Resources Summary | Metric | December 31, 2020 ($) | Six Months Ended Dec 31, 2020 ($) | Six Months Ended Dec 31, 2019 ($) | | :------------------------------------ | :------------------ | :---------------------------- | :---------------------------- | | Working capital | $14.1 million | N/A | N/A | | Total cash and cash equivalents | $5.3 million | N/A | N/A | | Net cash provided by operating activities | N/A | $1.5 million | $938,000 | | Net cash used in investing activities | N/A | $(2.2 million) | $(1.2 million) | | Net cash used in financing activities | N/A | $(116,000) | $(489,000) | - Over **50%** of the company's cash and cash equivalents are held by foreign subsidiaries, with LPOIZ having **$7.6 million** available for repatriation[116](index=116&type=chunk)[118](index=118&type=chunk) - Capital expenditures for the first half of fiscal 2021 were **$2.2 million**, primarily for expanding infrared coating, lens pressing, and dicing capacity to meet demand[125](index=125&type=chunk) [Contractual Obligations and Commitments](index=27&type=section&id=Contractual%20Obligations%20and%20Commitments) This section outlines the company's principal contractual obligations, including lease and debt agreements - Principal commitments include obligations under operating and finance leases and debt agreements[126](index=126&type=chunk) - No material changes occurred in contractual cash obligations or contingent liabilities during the first half of fiscal 2021 compared to the prior annual report[126](index=126&type=chunk) [Off-Balance Sheet Arrangements](index=27&type=section&id=Off-Balance%20Sheet%20Arrangements) This section confirms the absence of variable interest entities or off-balance sheet arrangements - The company does not engage in any activities involving variable interest entities or off-balance sheet arrangements[127](index=127&type=chunk) [Critical Accounting Policies and Estimates](index=27&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section addresses the company's critical accounting policies and estimates, noting any material changes - There have been no material changes to the company's critical accounting policies and estimates during the three months ended December 31, 2020[128](index=128&type=chunk) [Non-GAAP Financial Measures](index=31&type=section&id=Non-GAAP%20Financial%20Measures) This section explains the use of non-GAAP financial measures, such as EBITDA, for performance evaluation [EBITDA](index=31&type=section&id=EBITDA) This section defines and reconciles EBITDA, providing insights into core operating performance - Management uses EBITDA as a non-GAAP financial measure to evaluate core operating performance and for planning purposes, believing it provides useful supplementary information to GAAP results[150](index=150&type=chunk) EBITDA Reconciliation | Metric | 3 Months Ended Dec 31, 2020 ($) | 3 Months Ended Dec 31, 2019 ($) | 6 Months Ended Dec 31, 2020 ($) | 6 Months Ended Dec 31, 2019 ($) | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net income (loss) | $(146,545) | $769,117 | $(49,477) | $(606,040) | | Depreciation and amortization | $864,855 | $868,148 | $1,691,163 | $1,760,220 | | Income tax provision | $241,112 | $321,869 | $675,752 | $470,187 | | Interest expense | $55,147 | $89,257 | $113,696 | $187,798 | | **EBITDA** | **$1,014,569** | **$2,048,391** | **$2,431,134** | **$1,812,165** | | **% of revenue** | **10%** | **21%** | **13%** | **11%** | - EBITDA for the three months decreased by **50.4%** due to lower operating income, while EBITDA for the six months increased by **34.1%** due to higher operating income from increased revenues and gross margin[152](index=152&type=chunk)[153](index=153&type=chunk) [Item 4. Controls and Procedures](index=32&type=section&id=Item%204%20Controls%20and%20Procedures) Management confirms the effectiveness of disclosure controls and internal control over financial reporting - Disclosure controls and procedures were evaluated and deemed effective as of December 31, 2020[154](index=154&type=chunk) - No material changes in internal control over financial reporting occurred during the fiscal quarter ended December 31, 2020[155](index=155&type=chunk) Part II Other Information [Item 1. Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no legal proceedings for the period - No legal proceedings were reported for the period[156](index=156&type=chunk) [Item 1A. Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) The company reported no new risk factors for the period - No new risk factors were reported for the period[156](index=156&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=33&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or use of proceeds for the period - No unregistered sales of equity securities or use of proceeds were reported for the period[157](index=157&type=chunk) [Item 3. Defaults Upon Senior Securities](index=33&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities for the period - No defaults upon senior securities were reported for the period[157](index=157&type=chunk) [Item 4. Mine Safety Disclosures](index=33&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company reported no mine safety disclosures for the period - No mine safety disclosures were reported for the period[157](index=157&type=chunk) [Item 5. Other Information](index=33&type=section&id=Item%205.%20Other%20Information) The company reported no other information for the period - No other information was reported for the period[157](index=157&type=chunk) [Item 6. Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists all filed exhibits, including corporate organizational documents, amendments, and certifications - The exhibits include various certificates of incorporation and amendments, bylaws, and certifications from the CEO and CFO[159](index=159&type=chunk)[160](index=160&type=chunk) [Signatures](index=36&type=section&id=Signatures) This section provides the official signatures of the company's President, CEO, and CFO, certifying the report - The report was signed by Shmuel Rubin, President and Chief Executive Officer, and Donald O. Retreage, Jr., Chief Financial Officer, on February 3, 2021[164](index=164&type=chunk)

LightPath Technologies, Inc. (NASDAQ:LPTH) Q1 2021 Earnings Conference Call November 5, 2020 4:30 PM ET Company Participants Donald Retreage - Chief Financial Officer Sam Rubin - President and Chief Executive Officer Conference Call Participants Brian Kinstlinger - Alliance Global Partners Gene Inger - The Inger Letter Operator Good afternoon and welcome to the LightPath Technologies Fiscal 2021 First Quarter Financial Results Conference Call. All participants will be in listen-only mode. [Operator Instruct ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2020 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to ____________ Commission file number 000-27548 LIGHTPATH TECHNOLOGIES, INC. ___________________________________________________ (Exact name of ...

Ligh LOGIES INVESTOR PRESENTATION SEPTEMBER 23, 2020 GLOBAL LEADER IN OPTICAL TECHNOLOGY 2 Safe Harbor Statement This presentation contains "forward-looking" statements that are based on our beliefs and assumptions and on information currently available to us. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, product development plans, competitive position, potential growth opportunities, the effects of competition and the ex ...

LightPath Technologies, Inc. (NASDAQ:LPTH) Q4 2020 Results Earnings Conference Call September 10, 2020 4:30 PM ET Company Participants Sam Rubin - President and Chief Executive Officer Donald Retreage - Chief Financial Officer Conference Call Participants Marc Wiesenberger - B. Riley FBR Gene Inger - ingerletter.com Operator Good afternoon, and welcome to the LightPath Technologies Fiscal Fourth Quarter and Year-End 2020 Financial Results Conference Call. All participants will be in a listen-only mode. [Ope ...

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) For the fiscal year ended June 30, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 000-27548 LIGHTPATH TECHNOLOGIES, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation o ...

OLOGIES INVESTOR PRESENTATION SEPTEMBER 2020 GLOBAL LEADER IN OPTICAL TECHNOLOGY 2 Safe Harbor Statement This presentation contains "forward-looking" statements that are based on our beliefs and assumptions and on information currently available to us. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, product development plans, competitive position, potential growth opportunities, the effects of competition and the expected e ...

LightPath Technologies, Inc. (NASDAQ:LPTH) Q3 2020 Earnings Conference Call May 7, 2020 4:30 PM ET Company Participants Donald Retreage - Chief Financial Officer Sam Rubin - President and Chief Executive Officer Conference Call Participants Marc Wiesenberger - B. Riley Operator Good afternoon, and welcome to the LightPath Technologies Third Quarter 2020 Financial Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please also note today’s event is being recorded. ...

[Cautionary Note Concerning Forward-Looking Statements](index=4&type=section&id=Cautionary%20Note%20Concerning%20Forward-Looking%20Statements) This report contains forward-looking statements subject to numerous risks and uncertainties beyond the company's control - This report contains forward-looking statements based on current expectations and assumptions. These statements are subject to numerous risks and uncertainties, many of which are beyond the company's control[11](index=11&type=chunk) - Key risks highlighted include the duration and scope of the COVID-19 pandemic, its impact on product demand and supply chains, government and individual responses to the pandemic, and general economic uncertainty[11](index=11&type=chunk) [Part I Financial Information](index=5&type=section&id=Part%20I%20Financial%20Information) [Financial Statements](index=5&type=section&id=Item%201%20Financial%20Statements) The unaudited condensed consolidated financial statements for the period ended March 31, 2020, reflect improved financial performance and asset growth [Unaudited Condensed Consolidated Balance Sheets](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) The balance sheet as of March 31, 2020, shows increased total assets and stockholders' equity, with decreased liabilities Condensed Consolidated Balance Sheet Highlights (unaudited) | Balance Sheet Item | March 31, 2020 ($ million) | June 30, 2019 ($ million) | | :--- | :--- | :--- | | **Total Current Assets** | $19.80 | $19.61 | | **Total Assets** | $46.06 | $45.97 | | **Total Current Liabilities** | $6.14 | $6.36 | | **Total Liabilities** | $12.14 | $12.51 | | **Total Stockholders' Equity** | $33.91 | $33.46 | [Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) For Q3 2020, revenue increased **10%** to **$8.7 million**, with net income of **$0.82 million**, reversing a prior-year loss Financial Performance Summary (unaudited) | Metric | Q3 2020 ($) | Q3 2019 ($) | Nine Months 2020 ($) | Nine Months 2019 ($) | | :--- | :--- | :--- | :--- | :--- | | **Revenue, net** | $8,708,981 | $7,905,582 | $25,860,823 | $25,003,810 | | **Gross Margin** | $4,012,176 | $3,105,669 | $10,332,274 | $9,689,985 | | **Operating Income (Loss)** | $1,062,812 | $20,818 | $1,507,366 | $(63,252) | | **Net Income (Loss)** | $816,017 | $(352,018) | $209,977 | $(918,633) | | **EPS (diluted)** | $0.03 | $(0.01) | $0.01 | $(0.04) | [Unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Stockholders'%20Equity) Total stockholders' equity increased from **$33.5 million** to **$33.9 million**, primarily due to net income and stock-based compensation - Stockholders' equity rose to **$33.91 million** at March 31, 2020, from **$33.46 million** at June 30, 2019[19](index=19&type=chunk) - The change was primarily due to net income of **$0.21 million** for the nine months ended March 31, 2020, and stock-based compensation of **$0.29 million**[19](index=19&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended March 31, 2020, net cash from operations was **$1.9 million**, a significant improvement, while investing and financing activities used cash Cash Flow Summary (Nine Months Ended March 31) | Cash Flow Activity | 2020 ($) | 2019 ($) | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $1,869,783 | $25,947 | | **Net cash used in investing activities** | $(1,318,035) | $(1,356,732) | | **Net cash used in financing activities** | $(727,039) | $(1,154,048) | | **Change in cash and cash equivalents** | $(222,988) | $(1,867,163) | | **Cash and cash equivalents, end of period** | $4,381,713 | $4,641,457 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies, including ASC Topic 842 adoption, revenue breakdown by product group, debt structure, and foreign cash holdings - The company adopted lease accounting standard ASC Topic 842 on July 1, 2019, recognizing operating lease right-of-use assets of **$1.7 million** and corresponding operating lease liabilities of **$2.3 million**[28](index=28&type=chunk) Revenue by Product Group (Nine Months Ended March 31) | Product Group | 2020 ($ million) | 2019 ($ million) | | :--- | :--- | :--- | | PMO | $10.75 | $10.59 | | Infrared Products | $13.26 | $12.52 | | Specialty Products | $1.85 | $1.89 | | **Total revenue** | **$25.86** | **$25.00** | - In December 2019, the company declared and paid a **$2 million** intercompany dividend from its Chinese subsidiary LPOIZ, resulting in **$0.2 million** of accrued Chinese withholding taxes[45](index=45&type=chunk) - As of March 31, 2020, the company was in compliance with all covenants for its BankUnited loans, including a term loan, revolving line of credit, and guidance line[71](index=71&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance, highlighting a **10%** revenue increase in Q3 2020 to **$8.7 million**, improved gross margin, and a net income of **$0.82 million** [Overview](index=21&type=section&id=Overview) LightPath is a global manufacturer of optical components and assemblies across three product groups, with recent organizational changes to enhance product portfolio management - The company's business is organized into three product groups: **Precision Molded Optics (PMO)**, **infrared products**, and **specialty products**[90](index=90&type=chunk) - Recent organizational changes were designed to better leverage expanded capabilities and manage a broader product portfolio, including a new product management function[89](index=89&type=chunk) [Results of Operations](index=23&type=section&id=Results%20of%20Operations) For Q3 2020, revenue grew **10%** to **$8.7 million**, with gross margin increasing to **46%**, resulting in a net income of **$0.82 million**, a significant turnaround Q3 2020 vs Q3 2019 Performance | Metric | Q3 2020 ($) | Q3 2019 ($) | Change ($) | | :--- | :--- | :--- | :--- | | **Revenue** | $8.7M | $7.9M | +10% | | **Gross Margin** | $4.0M (46%) | $3.1M (39%) | +29% | | **Net Income (Loss)** | $816K | $(352K) | +$1.17M | - The increase in Q3 PMO revenue was driven by sales to medical and telecommunications markets, while infrared revenue growth was fueled by molded products for applications like fever detection[95](index=95&type=chunk) - For the nine months ended March 31, 2020, net income was **$0.21 million**, compared to a net loss of **$0.92 million** in the prior-year period, primarily due to a **$1.6 million** improvement in operating income[111](index=111&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2020, the company had working capital of **$13.7 million** and cash of **$4.4 million**, with **$1.9 million** in cash flow from operations - At March 31, 2020, working capital was **$13.7 million** and cash and cash equivalents were **$4.4 million**[113](index=113&type=chunk) - Cash flow from operations was approximately **$1.9 million** for the first nine months of fiscal 2020, compared to only **$26K** for the same period in fiscal 2019[119](index=119&type=chunk) - Capital expenditures for the nine-month period were **$1.5 million**, mainly for expanding BD6 material production and infrared coating capacity[120](index=120&type=chunk) [Sales Backlog](index=28&type=section&id=Sales%20Backlog) The 12-month sales backlog as of March 31, 2020, increased **17%** year-over-year to **$20.0 million**, driven by new orders and contract renewals 12-Month Sales Backlog Trend | Quarter | Backlog ($ K) | Change From Prior Quarter End | | :--- | :--- | :--- | | Q3 2019 | $17,137 | -6% | | Q4 2019 | $17,121 | 0% | | Q1 2020 | $15,390 | -10% | | Q2 2020 | $19,095 | +24% | | Q3 2020 | $20,012 | +5% | - The 12-month backlog at March 31, 2020 was approximately **$20.0 million**, a **17%** increase compared to March 31, 2019[133](index=133&type=chunk) [Non-GAAP Financial Measures](index=31&type=section&id=Non-GAAP%20Financial%20Measures) The company uses EBITDA as a non-GAAP measure, with Q3 2020 EBITDA at **$1.9 million**, more than double the prior year, reflecting improved operating performance EBITDA Reconciliation (unaudited) | Metric | Q3 2020 ($) | Q3 2019 ($) | Nine Months 2020 ($) | Nine Months 2019 ($) | | :--- | :--- | :--- | :--- | :--- | | **Net income (loss)** | $816,017 | $(352,018) | $209,977 | $(918,633) | | **Depreciation & Amortization** | $827,095 | $857,287 | $2,587,315 | $2,540,963 | | **Income tax provision (benefit)** | $203,369 | $161,870 | $673,556 | $(40,493) | | **Interest expense** | $85,464 | $275,233 | $273,262 | $573,535 | | **EBITDA** | **$1,931,945** | **$942,372** | **$3,744,110** | **$2,155,372** | [Controls and Procedures](index=31&type=section&id=Item%204%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2020, with no material changes to internal controls - The CEO and CFO concluded that disclosure controls and procedures were effective as of March 31, 2020[148](index=148&type=chunk) - No material changes were made to internal control over financial reporting in the quarter, with the company monitoring COVID-19's impact on controls[149](index=149&type=chunk) [Part II Other Information](index=32&type=section&id=Part%20II%20Other%20Information) [Legal Proceedings](index=32&type=section&id=Item%201%20Legal%20Proceedings) The company reported no legal proceedings during the period - No legal proceedings were reported[150](index=150&type=chunk) [Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors were reported, except for a new risk factor concerning the potential adverse effects of pandemics like COVID-19 - A new risk factor was added to address the potential adverse impact of pandemics like **COVID-19**[151](index=151&type=chunk) - The company is considered an "essential business" but acknowledges the pandemic could still materially affect operations, supply chain, and customer demand, with uncertain financial impact[152](index=152&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the quarter, **5,000** shares of Class A common stock were issued to a consultant at **$1.23** per share, exempt from registration - Issued **5,000** shares of Class A common stock to a consultant for services, at a price of **$1.23** per share[153](index=153&type=chunk) [Defaults Upon Senior Securities](index=32&type=section&id=Item%203%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - No defaults upon senior securities were reported[154](index=154&type=chunk) [Exhibits](index=33&type=section&id=Item%206%20Exhibits) This section lists all exhibits filed with the quarterly report, including corporate governance documents and certifications - The exhibits filed with the report include certifications from the CEO and CFO (31.1, 31.2, 32.1, 32.2) and XBRL data files[157](index=157&type=chunk) [Signatures](index=35&type=section&id=Signatures) - The report was duly signed and authorized by **Shmuel Rubin**, President and CEO, and **Donald O. Retreage, Jr.**, CFO, on **May 7, 2020**[159](index=159&type=chunk)[161](index=161&type=chunk)