Precision Optics (POCI) - 2025 Q2 - Quarterly Report

Revenue Performance - Total revenues for the quarter ended December 31, 2024 were $4,526,907, a decrease of$297,382 or 6.2% compared to $4,824,289 for the same period in the prior year[69]. - Revenue from Engineering Design Services decreased 46.8$317,747 during the quarter ending December 31, 2024, up $96,019 from$221,728 in the same quarter of the prior year[76]. - SG&A expenses decreased 14.0% to $1,662,216 during the three months ending December 31, 2024, compared to$1,933,411 in the same period of the prior year[77]. Cash Flow and Financing - Net cash used in operating activities totaled $1,105,431 during the six months ending December 31, 2024, a decrease from$1,492,824 in the same period of the prior year[79]. - The company raised a net of $1,204,542 through the issuance of new shares in a registered direct common stock offering during the six months ending December 31, 2024[81]. - The company raised approximately$1.4 million in gross proceeds from the sale of 265,868 shares of common stock on August 14, 2024, with net proceeds of $1,204,542[84]. Debt and Commitments - The company has a$2,600,000 term loan and a second term loan of $750,000, with$900,000 in borrowings outstanding on the line of credit as of December 31, 2024[82]. - The company did not meet the minimum annual debt service coverage ratio covenant of 1.2x as of June 30, 2024, but the lender has agreed to waive compliance for this period[83]. - Contractual cash commitments for fiscal 2025 total $111,094, including$19,610 for capital lease payments and $92,007 for minimum operating lease payments[86]. - The company has approximately$5,807,000 in contractual cash commitments related to open purchase orders as of December 31, 2024[86]. Operational Insights - The market for single-use endoscopes is expected to grow at two to three times the rate of the overall minimally invasive surgical market[63]. - There are currently no off-balance sheet arrangements that could materially affect the company's financial condition or results of operations[87]. - As a smaller reporting company, the company is electing scaled disclosure reporting obligations and is not required to provide certain market risk information[88].