Luna(US:LUNA)2020-05-07 21:05Revenue Performance - Total revenues for the three months ended March 31, 2020, increased by $2.3 million, or 16%, to $17.1 million compared to $14.8 million for the same period in 2019[117]. - Revenues from the Products and Licensing segment rose by $2.1 million, or 26%, to $10.3 million, driven primarily by $1.8 million from the legacy business of General Photonics Corporation (GP) and growth in communications test instruments[117]. - Technology Development segment revenues increased by $0.2 million, or 3%, to $6.8 million, continuing a growth trend attributed to successes in Phase 2 SBIR awards and non-SBIR contracts[118]. - The Products and Licensing segment accounted for 60% of total revenues for the three months ended March 31, 2020, compared to 55% for the same period in 2019[106]. - The Technology Development segment represented 40% of total revenues for the three months ended March 31, 2020, down from 45% in the same period in 2019[107]. Backlog Information - The backlog for the Products and Licensing segment was approximately $14.3 million as of March 31, 2020, expected to be recognized as revenue in future periods[101]. - The Technology Development segment backlog was approximately $29.0 million as of March 31, 2020, with a significant portion expected to be recognized as revenue in the coming years[102]. - The backlog for the Products and Licensing segment was approximately $14.3 million as of March 31, 2020, down from $16.1 million at December 31, 2019[101]. - The Technology Development segment backlog was approximately $29.0 million at March 31, 2020, compared to $31.3 million at December 31, 2019[102]. Profitability and Expenses - Gross profit for the same period increased by $1.6 million, or 24%, to $8.4 million, resulting in a gross margin of 49%, up from 46% in 2019[122]. - For the three months ended March 31, 2020, the total cost of revenues increased by $0.7 million, or 9%, to $8.8 million compared to $8.1 million for the same period in 2019[119]. - Operating expenses rose by $0.3 million, or 4%, to $8.0 million, with selling, general and administrative expenses increasing by 3% and research, development, and engineering expenses increasing by 10%[123][124]. - Total operating expenses rose by $309,000, or 4%, to $7.974 million for the three months ended March 31, 2020, compared to $7.665 million in 2019[123]. - Research, development, and engineering expenses increased by $139,000, or 10%, to $1.597 million for the three months ended March 31, 2020[124]. Income and Loss - Income from continuing operations before income taxes was $0.5 million for the three months ended March 31, 2020, compared to a loss of $0.7 million for the same period in 2019[127]. - The net loss from discontinued operations was $1.4 million, primarily due to the sale of the High Speed Optical Receiver business[128]. Cash Flow and Financial Position - As of March 31, 2020, total cash and cash equivalents were $26.3 million, with an available Revolving Line of credit of up to $10.0 million[129][130]. - Net cash used in operating activities was $0.3 million, a decrease of $1.9 million compared to $1.6 million provided in the same period of 2019[132]. - Cash provided by investing activities was $0.4 million, significantly improved from a cash outflow of $19.3 million in the prior year, which included a $19.0 million acquisition[134]. - Net cash provided by financing activities was $1.2 million, primarily from the exercise of stock options[135]. - The company anticipates that its cash balance and available credit will meet its working capital needs over the next twelve months, although potential impacts from the COVID-19 pandemic are acknowledged[131]. - The company believes its cash balance and available credit will meet working capital needs over the next twelve months, despite potential impacts from the COVID-19 pandemic[131]. Strategic Initiatives - The company continues to invest in product development and commercialization, anticipating increased product sales growth in the future[100]. - The acquisition of General Photonics Corporation was completed for a total consideration of $19.0 million, with an additional potential earn-out of up to $1.0 million[102]. - The company is exploring growth through acquisitions of additional companies and complementary technologies[103]. - The company expects to continue investing in product development and commercialization to drive future sales growth[100]. COVID-19 Impact - The impact of the COVID-19 pandemic on operations remains uncertain, with minor supply chain impacts managed through existing inventory[104].