Luna(US:LUNA)2020-08-06 20:29Revenue Performance - Lightwave segment revenues were $12.9 million for Q2 2020, a 3.2% increase from $12.5 million in Q2 2019, representing 70% of total revenues [106]. - Luna Labs segment revenues were $5.6 million for Q2 2020, up from $5.3 million in Q2 2019, accounting for 30% of total revenues [108]. - Total revenues for the three months ended June 30, 2020 increased by $762,000, or 4%, to $18.6 million compared to $17.8 million for the same period in 2019 [124]. - Lightwave segment revenues increased by $410,000, or 3%, to $12.9 million, driven primarily by growth in sales of sensing products [124]. - Luna Labs segment revenues increased by $352,000, or 7%, to $5.6 million, continuing a growth trend largely driven by Phase 2 SBIR awards [125]. - Total revenues for the six months ended June 30, 2020 increased by $3.1 million, or 9%, to $35.7 million compared to $32.6 million for the same period in 2019 [133]. - Lightwave segment revenues for the six months ended June 30, 2020 increased by $2.4 million, or 11%, to $24.5 million, primarily due to incremental revenues from acquired operations [133]. - Luna Labs segment revenues for the six months ended June 30, 2020 increased by $624,000, or 6%, to $11.2 million, driven by successes in Phase 2 SBIR awards [134]. Backlog Information - Total backlog for the Lightwave segment was approximately $21.3 million as of June 30, 2020, compared to $16.1 million at December 31, 2019 [108]. - Total backlog for the Luna Labs segment was approximately $21.0 million as of June 30, 2020, down from $31.3 million at December 31, 2019 [109]. - Funded backlog for the Lightwave segment is expected to generate $6.9 million in future revenue, while unfunded backlog is projected to yield $14.4 million [108]. - Funded backlog for the Luna Labs segment is expected to generate $18.7 million in future revenue, with an additional $2.2 million from unfunded backlog [109]. - The backlog for the Luna Labs segment was approximately $21.0 million as of June 30, 2020, down from $31.3 million at December 31, 2019, with expected future revenue recognition detailed in a breakdown [109]. Profitability and Expenses - Gross profit for the three months ended June 30, 2020 increased by $765,000, or 9%, to $9.5 million, resulting in a gross margin of 51% compared to 49% in the prior year [126][128]. - Overall gross margin for the six months ended June 30, 2020 increased to 50% compared to 48% for the same period in 2019 [138]. - Operating expenses for the three months ended June 30, 2020 decreased slightly by $31,000, remaining stable at $7.7 million [129]. - Operating expenses increased by $0.3 million, or 2%, to $15.7 million for the six months ended June 30, 2020, compared to $15.4 million for the same period in 2019 [139]. - Income from continuing operations before income taxes for the three months ended June 30, 2020 was $1.8 million, compared to $1.1 million for the same period in 2019 [132]. - Income from continuing operations before income taxes was $2.3 million for the six months ended June 30, 2020, compared to $0.3 million for the same period in 2019 [143]. Cash Flow and Liquidity - As of June 30, 2020, the company had total cash and cash equivalents of $26.5 million [145]. - Net cash provided by operating activities for the first six months of 2020 was $0.1 million, a decrease of $1.0 million compared to $1.1 million in 2019 [148]. - Net cash provided by investing activities in the first half of 2020 was $0.3 million, a significant improvement compared to a cash outflow of $19.5 million in 2019 [150]. - The company reported a net increase in cash and cash equivalents of $1.5 million for the first six months of 2020, compared to a decrease of $18.9 million in 2019, marking a positive change of $20.4 million [148]. - The company anticipates adequate liquidity to meet working capital needs over the next twelve months, despite potential impacts from the ongoing COVID-19 pandemic [147]. Acquisitions and Investments - The company acquired General Photonics Corporation for $19.0 million, with an additional earn-out provision of up to $1.0 million, completed in Q2 2020 [110]. - The company continues to invest in product development and commercialization, anticipating increased product sales growth in the future [107]. - The company expects revenues from product sales to continue to grow, particularly in the areas of sensing and test, measurement, and control fiber optic test platforms [107]. Discontinued Operations - Net loss from discontinued operations was $1.4 million for the six months ended June 30, 2020, related to the sale of the High Speed Optical Receiver business [144].