Luna(US:LUNA)2022-03-14 19:15Financial Data and Key Metrics Changes - For Q4 2021, total revenues were $24.2 million, a 26% increase from $19.3 million in Q4 2020 [20][47] - Operating income was $1 million compared to a loss of $600,000 in Q4 2020 [20][50] - Gross margin was 58% in Q4 2021, down from 61% in the same quarter last year [20][48] - Adjusted EBITDA for Q4 2021 was $3.1 million, slightly up from approximately $3 million in Q4 2020 [20][51] - Full year 2021 revenues were reported to be $109 million to $115 million, representing a 25% to 31% growth [38][55] Business Line Data and Key Metrics Changes - The sensing business achieved approximately 68% revenue growth for the full year, with OptaSense growing nearly 40% in 2021 [32][33] - The communications test business received the largest order ever for the RIO semiconductor laser in Q4 2021 [34] Market Data and Key Metrics Changes - The company noted significant opportunities in infrastructure, aerospace, 5G, and electric vehicles [17][25] - The acquisition of LIOS Sensing is expected to enhance capabilities in temperature and strain sensing, expanding into high-growth markets [22][24] Company Strategy and Development Direction - The company has focused on transforming into a global fiber optic leader through strategic divestitures and acquisitions [9][12] - The divestiture of Luna Labs marks a significant step in simplifying the portfolio and focusing on fiber optics [12][21] - The acquisition of LIOS Sensing is seen as a critical move to complete the product portfolio and enhance market offerings [22][24] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges from COVID-19 and supply chain issues but expressed confidence in future growth opportunities [15][37] - The outlook for 2022 includes a revenue range of $109 million to $115 million and adjusted EBITDA of $10 million to $12 million [38][55] - Management emphasized the importance of execution and maintaining focus on strategic goals [41][42] Other Important Information - The company ended Q4 2021 with $17.1 million in cash and cash equivalents, up from $15.4 million at the end of 2020 [52] - Total debt outstanding was $15.8 million as of December 31, 2021 [54] Q&A Session Summary Question: How confident is the company in its 2022 revenue guidance considering supply chain issues? - Management expressed confidence in the guidance of $109 million to $115 million, having factored in supply chain challenges based on customer feedback and historical data [66] Question: What were the 2021 revenue and EBITDA figures for the LIOS acquisition? - The full year revenue for LIOS was around $16 million, with EBITDA being flat [68][69] Question: Does the acquisition of LIOS complete the company's product portfolio? - Management indicated that the acquisition completes the basic building blocks of the product portfolio, allowing future M&A to focus on customer bases and geographies [70][73] Question: What are the company's thoughts on share buybacks? - Management stated that discussions on capital allocation, including buybacks, are ongoing, but the current focus is on growth through investments and acquisitions [75] Question: Can management provide insight into the pipeline of larger programs? - Management highlighted several significant programs in the pipeline, with potential annual revenue contributions of $30 million to $50 million from various deals [80]