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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q/A

(Amendment No. 1)

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: March 31, 2024

 

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: 000-56166

 

Laser Photonics Corporation
(Exact name of registrant as specified in its charter)

 

Delaware   84-3628771
(State or other jurisdiction of
incorporation or organization)
  (I.R.S. Employer
Identification No.)

 

1101 N. Keller Road, Suite G
Orlando, FL
  32810
(Address of Principal Executive Offices)   Zip Code

 

(407) 804 1000
Registrant’s Telephone Number, Including Area Code

 

Not Applicable
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

 

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE

 

COMMON STOCK, $0.01 PAR VALUE

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common Stock   LASE   The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting Company, or an emerging growth Company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting Company,” and “emerging growth Company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer Accelerated filer
Non-accelerated Filer Smaller reporting Company
    Emerging growth company

 

If an emerging growth Company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Indicate by check mark whether the registrant is a shell Company (as defined in Rule 12b-2 of the Exchange Act) Yes ☐ No

 

As of May 20, 2024, the registrant had 9,270,427 shares of common stock, par value $.01 per share, issued and outstanding.

 

 

 

 

 

 

EXPLANATORY NOTE

 

Laser Photonics Corporation (the “Company”) is filing this Amendment No. 1 (“Amendment No. 1”) to its Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2024, as filed with the Securities Exchange Commission on May 15, 2024 (the “Original Filing”) to reflect certain revisions to the Notes to Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations, among other changes. The Original Filing was inadvertently filed prior to the Company’s outside independent accounting firm having had the opportunity to complete its review. Accordingly, the unaudited interim financial information presented in the Original Filing was not reviewed by the Company’s outside independent accounting firm as required by the rules of the Securities and Exchange Commission and as a result, the Original Filing is considered deficient and the Company is no longer considered to be timely or current in its filings under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). This Amendment No. 1 is being filed by the Company to reflect the completed review of the Company’s outside independent accounting firm, Fruci & Associates II, PLLC, which contains certain revised information. Management believes that the interim financial information presented herein fairly presents, in all material respects, the financial condition and results of operations of the Company as of the end of and for the referenced periods and may be relied upon. Except for the absence of this review of the unaudited interim financial information discussed above, the Original Filing and this Amendment No. 1 to the Original Filing fully comply with the requirements of the Exchange Act.

 

 

 

 

TABLE OF CONTENTS

 

    Page No.
PART I – FINANCIAL INFORMATION  
     
Item 1. Financial Statements 3
     
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 17
     
Item 3. Quantitative and Qualitative Disclosures About Market Risk 19
     
Item 4. Controls and Procedures 21
     
PART II – OTHER INFORMATION  
     
Item 1. Legal Proceedings 22
     
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 22
     
Item 3. Defaults Upon Senior Securities 22
     
Item 4. Mine Safety Disclosures 22
     
Item 5. Other Information 22
     
Item 6. Exhibits 22
     
Signatures 23
   
Certifications  

 

2

Table of Contents

 

PART I – FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

LASER PHOTONICS CORPORATION

CONDENSED BALANCE SHEETS

 

   2024   2023 
  

As of

March 31, 2024

  

As of

December 31, 2023

 
   (Unaudited)   (Audited) 
Assets          
Current Assets:          
Cash and Cash Equivalents  $5,173,125   $6,201,137 

Accounts Receivable, Net

   443,309    816,364 
Inventory   2,167,000    2,277,816 
           
Other Assets   114,759    39,191 
           
Total Current Assets   7,898,193    9,334,508 
           
Property, Plant, & Equipment, Net   1,013,638    952,811 
           
Intangible Assets, Net   4,195,597    4,279,986 
           
Operating Lease Right-of-Use Asset   477,363    597,143 
           
Total Assets  $13,584,791   $15,164,448 
           
Liabilities & Stockholders’ Equity          
Current Liabilities:          
Accounts Payable  $306,302   $223,040 
Deferred Revenue   772,686    701,234 
Current Portion of Operating Lease   314,373    434,152 
Accrued Expenses   79,007    161,538 
Total Current Liabilities   1,472,368    1,519,964 
           
Long Term Liabilities:          
Lease liability - less current   162,991    162,991 
Total Long Term Liabilities   162,991    162,991 
Total Liabilities   1,635,359    1,682,955 
           
Commitments and Contingencies (Note 3)   -    - 
           
Stockholders’ Equity:          
Preferred stock Par value $0.001: 10,000,000 shares authorized. 0 Issued: 0 shares were outstanding as of March 31, 2024 and December 31, 2023   -    - 
           
Common Stock Par Value $0.001: 100,000,000 shares authorized; 9,270,427 and 9,253,419 issued and outstanding as of March 31, 2024 and December 31,2023   92,704    92,534 
           
Additional Paid in Capital   18,110,923    19,097,445 
           
Retained Earnings (Deficit)   (6,228,955)   (5,683,246)
           
Treasury Stock   (25,240)   (25,240) 
           
Total Stockholders’ Equity   11,949,432    13,481,493 
           
Total Liabilities & Stockholders’ Equity  $13,584,791   $15,164,448 

 

See accompanying notes to financial statements.

 

3

Table of Contents

 

LASER PHOTONICS CORPORATION

STATEMENTS OF PROFIT AND LOSS

(UNAUDITED)

 

   2024   2023 
   March 31, 
   2024   2023 
Net Sales  $742,991   $676,192 
           
Cost of Sales   357,123    269,897 
           
Gross Profit   385,868    406,295 
           
Operating Expenses:        
           
Sales & Marketing   136,610    262,925 
           
General & Administrative   356,265    575,866 
           
Depreciation & Amortization   185,316    83,137 
           
Payroll Expenses   208,455    343,702 
           
Research and Development Cost   47,691    40,254 
           
Total Operating Expenses   934,338    1,305,882 
           
Operating Income (Loss)   (548,470)   (899,588)
Other Income (Expenses):          
Total Other Income (Loss)  2,760   (358,017)
           
Income (Loss) Before Tax  (545,709)  (1,257,605)
           
Tax Provision   -    - 
Net Income (Loss)  $(545,709)  $(1,257,605)
           
Income (Loss) per Share:          
Basic  $(0.06)  $(0.14)
Fully diluted   $

(0.06

)  $

(0.14

)
WASO   

9,270,425

    

9,008,910

 

 

See accompanying notes to financial statements.

 

4

Table of Contents

 

LASER PHOTONICS CORPORATION

STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

   2024   2023 
   March 31, 
   2024   2023 
Cash Flows From:          
OPERATING ACTIVITIES          
Net Income (Loss)  $(545,709)  $(1,257,605)
Adjustments to Reconcile Net Income (Loss) to Net Cash Flow from Operating Activities:          
Shares issued for compensation   33,336    -  
Distribution to affiliate   (1,019,687)   -  
Depreciation & Amortization   185,316    83,137 
Change in Operating Assets & Liabilities:          
Accounts Receivable   373,055    319,123 
Inventory   110,816    (228,129)
Prepaids & Other Current Assets   (75,565)   (98,942)
Accounts Payable   83,261    218,608 
Accrued Expenses   (82,531)   (351,500)
21030 · Deferred Revenue   71,452    -  
Net Cash From (Used In) Operating Activities   (866,258)   (1,315,308)
           
INVESTING ACTIVITIES          
Purchase of Machinery & Equipment   (2,869)   (1,399)
Purchase of R&D Equipment   (4,095)   - 
Office & Computer Equipment   (3,739)   (49,402)
Leasehold Improvements   (151,052)   -  
Net Cash From (Used In) Investing Activities   (161,755)   (50,801)
           
FINANCING ACTIVITIES          
Proceeds from Sale of Common Stock   -     - 
Net Cash From (Used In) Financing Activities   -    - 
Net Cash Flow for Period   (1,028,012)   (1,366,109)
Cash - Beginning of Period   6,201,137    12,181,799 
Cash - End of Period  $5,173,125   $10,815,690 
NON-CASH INVESTING AND FINANCING ACTIVITIES          
Shares issued on conversion of debt   -    - 
Share issued for purchase of license   -    - 
SUPPLEMENTARY CASH FLOW INFORMATION          
Cash Received / Paid During the Period for:          
Income Taxes   -    - 
Interest   -    - 

 

See accompanying notes to financial statements

 

5

Table of Contents

 

LASER PHOTONICS CORPORATION

STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT)

(UNAUDITED)

 

   Shares   Amount   Shares   Amount   Shares   Amount   Stock   Capital   Gain/Deficit   loss   (Deficit) 
   Three months ended March 31, 2024 
   Preferred Stock   Common Stock   Shares to be issued.   Treasury Stock  

Additional

Paid-in Capital

   Accumulated Gain  

Accumulated

Comprehensive

 

Stockholders’

Equity
 
   Shares   Amount   Shares   Amount   Shares   Amount   (Deficit)   (Deficit)   (Deficit)   loss   (Deficit) 
   #   $   #   $   #   $   $   $   $   $   $ 
                                                       
As at December 31, 2023 (Audited)   -     -     9,253,419    92,534    -    -    (25,240)   19,097,445    (5,683,246)  -    13,481,493 
                                                       
Net loss   -     -     -    -     -     -     -     -    (545,709)  -    (545,709)
                                                       
Stock Issued for compensation   -     -     17,008    170    -     -      -    33,165    -     -    33,335 
                                                       
Distributions to affiliate   -     -     -     -     -     -      -    (1,019,687)   -     -    (1,019,687)
                                                       
Stock issued for compensation         -                                        -  
As at March 31, 2024   -    -    9,270,427    92,704    -     -     (25,240)   18,110,923    (6,228,955)   -    11,949,432 

 

   Shares   Amount   Shares   Amount   Shares   Amount   Stock   Capital   Gain/Deficit   loss   (Deficit) 
   Three months ended March 31, 2023 
   Preferred Stock   Common Stock   Shares to be issued.   Treasury Stock  

Additional

Paid-in Capital

   Accumulated Gain  

Accumulated

Comprehensive

  

Stockholders’

Equity
 
   Shares   Amount   Shares   Amount   Shares   Amount   (Deficit)   (Deficit)   (Deficit)   loss   (Deficit) 
   #   $   #   $   #   $   $   $   $   $   $ 
                                                        
As at December 31, 2022 (Audited)   -    -    7,878,419    78,783    350,000    829,500    -    18,140,520    (1,917,314)   -    17,131,489 
                                                        
Net loss   -     -     -     -     -     -     -     -     (1,257,605)   -     (1,257,605)
                                                        
As at March 31, 2023   -     -     7,878,419    78,783    350,000    829,500    -     18,140,520    (3,174,919)   -     15,873,884 

 

See accompanying notes to financial statements

 

6

Table of Contents

 

LASER PHOTONICS CORPORATION

 

NOTES TO FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 1 –BASIS OF PRESENTATION

 

The accompanying unaudited condensed financial statements and notes of Laser Photonics Corporation (the “Company”) are presented in United States dollars and have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, those do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These financial statements should be read in conjunction with the financial statements, notes and significant accounting policies included in our Annual Report on Form 10-K for the year ended December 31, 2023.

  

NOTE 2 – RESTATEMENT of Q1 2023.

 

Q1 2023 was unaudited and as we were preparing our Q1 2024 filing we noticed the balances in our ledger did not match what was filed. Our system of record current financials is the basis for the financials as they are presented, not the prior Q1 2023 filing. During our re-audit of 2022 financial beginning balances changed impacting the Q1 2023 figures as such the 10Q for 2023 numbers reflected now are different.

 

The financial statement for the period ending March 31, 2023 have been restated to reflect adjustments identified during 2023 audit. These adjustments relate to various accounts listed in the restatement adjustment column below, resulting in corrections to the previously reports figures. The restatement was deemed necessary to ensure the accuracy and reliability of the financial information presented herein.

 

7

Table of Contents

 

Restatement of Q1 2023 Reconciliation:

Restatement of Previously Issued Financial Statements Q1 2023

 

In thousands

Balance Sheet  As Filed   Adjustments   As Restated 
       Restatement     
Balance Sheet  As Filed   Adjustments   As Restated 
Assets               
Cash and cash equivalent  $10,815   $-   $10,816 
Accounts receivable, net  1,747   -1,645   102 
Prepaid expenses and other current assets  -   161   161 
Inventory  1,951   -677   1,274 
Total current assets  14,513   -2,160   12,353 
Other Assets  183   -161   22 
PP&E  652   463   1,115 
Intangible Assets Net  2,882   -   2,882 
Operating Lease Right of Use Asset  742   -   742 
        -     
Total assets  18,972   -1,858   17,114 
                
Liabilities              
Current Liabilities       -     
Accounts payable  421   -12   409 
Accrued Liabilities  -   -   11
Deferred revenue  -   -   - 
Current Portion of Operating Lease  345   -   345 
Accrued expenses  1,750   -1,672   78 
Total current liabilities  2,516   -1,673   843 
Long Term Liabilities  -   -  - 
Lease Liability less current  397   -   397 
Total Long Term liabilities  397   -   397 
Total Liabilitiy  2,913   -1,673   1,240 
Stockholders’ Equity            
Preferred Stock  -   -   - 
Common Stock  78   -   78 
Shares to be issued  -   -   830 
Additional paid-in capital  18,141   -   18,141 
Retained Earnings  -728   -1,189   -1,917 
Net Income (Loss)  -1,432    174   -1,258 
Total stockholders’ equity  16,059   -185   15,874 
Total liabilities and stockholders’ equity  18,972   -1,858   17,114 

 

8

Table of Contents

 

   As Filed   Adjustments   As Restated 
       Restatement     
   As Filed   Adjustments   As Restated 
Statement of operations               
Net Sales  1,237    -561    676 
Other income  -    -    -
Cost of Sales  241    29    270 
Gross Profit  996    -590    406 
Operating Expenses:              
Sales & Marketing  1,068    -805    263 
General & Administrative  1,077    -501    576 
Depreciation & Amortization  83    -    83 
Payroll Expenses  -    344    344 
Total other Income Expense  -    -    - 
Research & Development  -    40    40 
Total Operating Expenses  2,228    -922    1,306 
Operating Income (Loss)  -1,232    332    -900 
Interest Expense  -200    200    - 
Onter income  -    -358    -358 
Income (Loss) Before Tax  -1,432    532    -1,258 
Net Income (Loss)  -1,432    174    -1,258 
                
Income (Loss) per Share               
Basic  -0.18    0.04    -0.14 
Diluted  -0.18    0.04    -0.14 

 

   As Filed   Adjustments   As Restated 
       Restatement     
   As Filed   Adjustments   As Restated 
Statement of cash flows               
OPERATING ACTIVITIES               
Net Income (Loss)   -1,432    174    -1,258 
Adjustments to Reconcile Net Income (Loss) to Net Cash Flow from Operating Activities:   -    -    0 
Shares to be issued as consideration for services   -    -    - 
Depreciation & Amortization   83    -    83 
Lease liability - less current   -    -    - 
Operating lease right-of-use   -    -    - 
Net Change, Right-of-Use Asset & Liabilities   -    -    - 
Change in Operating Assets & Liabilities:   -    -    - 
Accounts Receivable   -400    719    319 
Other current assets   -110    110    0 
Inventory   -257    29    -228 
Prepaids & Other Current Assets   -    -99    -99 
Stock Account   -    -    0 
Accounts Payable   230    -12    219 
Accrued Expenses   570    -922    -352 
21030 · Deferred Revenue   -    -    - 
24240 · Lease liability Current Portion   -    -    - 
Net Cash From (Used In) Operating Activities   -1,315    -    -1,315 
                
INVESTING ACTIVITIES           - 
Purchase of Long term assets   -51    49    -2 
Leasehold improvements   -    -    - 
Office & Computer Equipment   -    -49    -49 
Purchase of R&D Equipment   -   -    - 
Demonstration Equipment   -    -    - 
Purchase of Intangible Assets   -   -    - 
Net Cash From (Used In) Investing Activities   -51    -    -51 
                
FINANCING ACTIVITIES               
Proceeds from (Repayment of) Notes   -    -    - 
Proceeds from (Repayment of) PPP Loan   -    -    - 
Dividends Paid   -    -    - 
Proceeds from Sale of Common Stock   -    -    - 
Net Cash From (Used In) Financing Activities   -    -    - 
Net Cash Flow for Period   -1,366    -    -1,366 
Cash - Beginning of Period   12,182    -    12,182 
Cash - End of Period   10,816    -    10,816 
NON-CASH INVESTING AND FINANCING ACTIVITIES   -    -    - 
Shares issued on conversion of debt   -    -    - 
Shares issued as consideration for services   -    -    - 
Share issued for purchase of license   -    -    - 
SUPPLEMENTARY CASH FLOW INFORMATION   -    -    - 
Cash Received / Paid During the Period for:   -    -    - 
Income Taxes   -    -    - 
Interest   -    -    - 

 

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NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES & USE OF ESTIMATES.

 

Our significant accounting policies are provided in “Note 2 – Summary of Significant Accounting Policies” in our Financial Statements 2023 Form 10-K. There have been no material changes to our significant accounting policies from those disclosed in our 2023 Form 10-K for the fiscal year ended December 31, 2023

 

Stock Based Compensation

 

The Company accounts for stock-based payments in accordance with the provision of ASC 718, which requires that all share-based payments issued to acquire goods or services, including grants of employee stock options, be recognized in the statement of operations based on their fair values, net of estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Compensation expense related to share-based awards is recognized over the requisite service period, which is generally the vesting period.

 

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at dates of the financial statements and the reported amounts of revenue and expenses during the periods. Actual results could differ from these estimates. In the opinion of management, our financial statements reflect all adjustments considered necessary by management to fairly state the results of operations, financial position and cash flows of the Company for the periods presented.

 

Revenue Recognition

 

Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, we assess the goods or services promised within each contract and determine those that are performance obligations and assess whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

 

Revenue is then recognized for the transaction price allocated to each respective performance obligation when (or as) the performance obligation is satisfied. For our products, revenue is generally recognized upon shipment or pickup by the customer. At this stage, the title on the manufactured equipment is transferred to the customer, and the customer is responsible for transportation expenses, insurance, and any transport-related damage to the equipment in transit. We do not hold any obligation to deliver beyond the collection warehouse, and it is the customers’ contractual responsibility to ensure their goods reach their destination.

 

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Refunds and returns, which are minimal, are recorded as a reduction of revenue. Payments received from customers before satisfying the above criteria are recorded as unearned income on the combined balance sheets.

 

Payments received as deposits for specific purchase orders or future laser equipment sales to customers are recognized as customer deposits and included in liabilities on the balance sheet. Customer deposits are recognized as revenue when control over the ordered equipment is transferred to the customer.

 

All revenues are reported net of any sales discounts or taxes.

 

Other Revenue Recognition Matters related to Distributors.

 

Distributors generally have no right to return unsold equipment. However, in limited circumstances, if the company determines that distributor stock is morally aging beyond the company’s new model releases, it may accept returns and provide the distributor with credit against their trading account at the company’s discretion under its warranty policy. This revenue is recognized on a consignment basis and transfer of control is when an item is sold to end customer at which time the company recognizes revenue.

 

Cash and Cash Equivalents

 

Cash and cash equivalents consist of highly liquid investments with an original maturity of three months or less at the date of purchase. Cash and cash equivalents are carried at a cost, which approximates fair value. The company has 5,039,472 in flexible CD account with Bank of America. The terms on this CD if flexible, having a term of 9 months that automatically renews, Full balance and interest can be withdrawn prior to maturity. A penalty of 7 days interest will be imposed for early withdrawals within the first 6 days of the account term.

 

Accounts Receivable

 

Trade accounts receivable are recorded net of allowance for expected uncollectible accounts. The Company extends credit to its customers in the normal course of business and performs on-going credit evaluations of its customers. All accounts, or portions thereof, that are deemed uncollectible are written off to bad debt expense, as incurred. In addition, most sales orders are not accepted without a substantial deposit. As of March 31, 2024, the balance of collectible accounts was 443,309. Allowance and amount recognized as bad debt ask of March 31, 2024 is 183,380

 

Current Liabilities

 

Accounts Payable

 

Accounts payable consist of short-term liability to our vendors and sub-contractors, who extend credit terms to the Company or deliver goods or services with delayed payment terms. As of March 31, 2024, and December 31, 2023, our accounts payable were recorded at 306,302 and 223,040, respectively.

 

Deferred Revenue

 

Deferred Revenue is primarily comprised of products that have been made available to key distributors that has not been sold. As of March 31, 2024 the Company had 772,686, and December 31, 2023 the Company’s deferred revenue liabilities were recorded 701,234.

 

As of March 31, 2024, there were no loan balances owed by the Company.

 

Inventory

 

Inventories are stated at a lower of cost or net realizable value using the first-in first-out (FIFO) method. The Company has four principal categories of inventory:

 

Sales demonstration inventory - Sales demonstration inventory represents completed product used to support our sales force for demonstrations and held for sale. Sales demonstration inventory is held in our demo facilities or by our sales representatives for up to three years, at which time it would be refurbished and transferred to finished goods as used equipment, stated at the lower of cost or net realizable value. The Company expects these refurbished units to remain in finished goods inventory and sold within 12 months at prices that produce reduced gross margins.

 

Equipment parts inventory - This inventory represents components and raw materials that are currently in the process of being converted to a certifiable lot of saleable products through the manufacturing and/or equipment assembly process. Inventories include parts and components that may be specialized in nature and subject to rapid obsolescence. The Company periodically reviews the quantities and carrying values of inventories to assess whether the inventories are recoverable. Because of the Company’s vertical integration, a significant or sudden decrease in sales activity could result in a significant change in the estimates of excess or obsolete inventory valuation. The costs associated with provisions for excess quantities, technological obsolescence, or component rejections are charged to cost of sales as incurred.

 

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Work in process inventory - Work in process inventory consists of inventory that is partially manufactured or not fully assembled as of the date of these financial statements. This equipment, machines, parts, frames, lasers and assemblies are items not ready for use or resale. Costs are accumulated as work in process until sales ready items are compete when it is moved to finished goods inventory. Amounts in this account represent items at various stages of completion at the date of these financial statements.

 

Finished goods inventory - Finished goods inventory consists of purchased inventory that were fully manufactured, assembled or in salable condition. Finished goods inventory is comprised of items that are complete and ready for commercial application without further cost other that delivery and setup. Finished goods inventory includes demo and other equipment, lasers, software, machines, parts or assemblies.

 

At March 31, 2024 and December 31, 2023, respectively, our inventory consisted of the following:

 

  As of March 31, 2024   As of December 31, 2023 
Inventory  Unaudited   (Audited) 
Equipment Parts Inventory  $947,647   $862,941 
Finished Goods Inventory  882,353   1,033,104 
Sales Demo Inventory  210,030   162,958 
Work in process Inventory  151,186   243,029 
Inventory Reserve  -24,216     -24,216 
Total Inventory  $2,167,000   $2,277,816 

 

Fixed Assets - Plant Machinery and Equipment

 

Property and equipment are recorded at cost. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period.

 

Machinery and Equipment

 

Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. The Company uses other depreciation methods (generally accelerated) for tax purposes where appropriate. The estimated useful lives for significant property and equipment categories are as follows:

Category 

Economic

Useful Life

Office furniture and fixtures  3-5 years
Machinery and equipment  5-7 years
Intangible Assets  7-15 years

 

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Fixed Assets  2024   2023 
Fixed Assets  As of
March 31, 2024
(Unaudited)
   As of
December 31, 2023
(Audited)
 
Accumulated Depreciation  $(830,883)  $(729,956)
Machinery & Equipment  799,652   796,783 
Office Furniture & Computer Equipment  81,225   77,487 
Vehicles  90,959   90,959 
R&D Equipment  42,068   37,973 
Leasehold improvements  182,827   31,775 
Demonstration equipment  647,790   647,790 
Total Fixed Assets  $1,013,638   $952,811 

 

Intangible Assets

 

Intangible assets consist primarily of capitalized equipment design documentation, software costs for equipment manufactured for sale, research, and development, as well as certain patent, trademark and license costs. Capitalized software and equipment design documentation development costs are recorded in accordance with Accounting Standard Codification (“ASC”) 985 “Software” with costs amortized using the straight-line method over a ten-year period. Patent, trademark and license costs are amortized using the straight-line method over their estimated useful lives of 15 years. On an ongoing basis, management reviews the valuation of intangible assets to determine if there has been impairment by comparing the related assets’ carrying value to the undiscounted estimated future cash flows and/or operating income from related operations.

 

The Company’s intangible assets are deemed to have indefinite lives and, accordingly, are not amortized, but are evaluated for impairment at least annually, but more often whenever changes in facts and circumstances occur which may indicate that the carrying value may not be recoverable.

 

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The Company employs various core technologies across many different product families and applications in an effort to maximize the impact of our research and development costs and increase economies of scale and to leverage its technology-specific expertise across multiple product platforms. The technologies inherent in its laser equipment products include application documentation, proprietary and custom software developed for operation of its equipment, specific knowledge of supply chain and, mostly important, equipment design documentation, consisting of 3D engineering drawings, bills of materials, wiring diagrams, parts AutoCad drawings, software architecture documentation, etc. Intangible assets were received from a related party, ICT Investments, and therefore transferred and booked by Laser Photonics Corp. at their historical cost.

Intangible Assets  2024   2023 
Intangible Assets  As of March 31, 2024 (Unaudited)   As of December 31, 2023 (Audited) 
Accumulated Amortization  $(809,617)  $(725,228)
Customer Relationships  211,000   211,000 
Equipment Design Documentation  2,675,000   2,675,000 
Operational Software & Website  339,539   339,539 
Trademarks  216,800   216,800 
License & Patents  1,562,875   1,562,876 
Total Intangible Assets  $4,195,597   $4,279,987 

 

Long-Lived Assets

 

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Impairment is measured by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to result from use of the assets and their ultimate disposition. In instances where impairment is determined to exist, the Company will write down the asset to its fair value based on the present value of estimated future cash flows.

 

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Net Earnings/Loss per Share

 

Basic Earnings/Loss per share is calculated by dividing the Earnings/Loss attributable to stockholders by the weighted-average number of shares outstanding for the period. Diluted Earnings/Loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in the earnings (loss) of the Company. Diluted Earnings/Loss per share is computed by dividing the Earnings/Loss available to stockholders by the weighted average number of shares outstanding for the period and dilutive potential shares outstanding unless such dilutive potential shares would result in anti-dilution.

 

NOTE 4 – STOCKHOLDERS’ EQUITY/DEFICIT

 

General

 

The following description of our securities and certain provisions of our amended and restated certificate of incorporation and amended and restated bylaws are summaries and are qualified by reference to the amended and restated certificate of incorporation and our bylaws that will be in effect on the closing of this offering. Copies of these documents have been filed with the SEC as exhibits to our registration statement, of which this prospectus forms a part. The descriptions of the Shares, and preferred stock reflect changes to our capital structure that will be in effect on the closing of this offering. Distributions to affiliate company totaled $1,019,687 to Fonon Corp include sales, marketing, and other shared costs associated with Fonon Corp.

 

Preferred Stock

 

  Par value: 0.001
  Authorized: 10,000,000
  Issued: There were no preferred shares issued and outstanding as of March 31, 2024

 

Common Stock

 

  Par value: 0.001
  Authorized: 100,000,000
  Issued: 9,270,427 as of March 31, 2024

 

On February 2nd 2024 17,000 Shares of Common stock were issued to Jade Barnwell, the former Laser Photonics CFO, under the terms of employment at $1.96 per share.

 

Warrants

 

As of March 31, 2024 there were 180,000 Warrants Outstanding

 Schedule of warrants

Warrants as at December 31, 2023  $6    180,000    1,080,000 
Issued        -      
Expired        -      
Warrants as at March 31, 2024  $6    180,000    1,080,000 

 

Options

 

As of March 31, 2024 there were no Options Issued or Outstanding

 

There has been no activity as of the end of December 31, 2023

 

 

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NOTE 5 – RELATED PAETY TRANSACTIONS

 

ICT Investments provides the Company accounting services and various management services on an as needed basis. For the three months ended March 31, pursuant to an arrangement with ICT Investment, the Company paid in total 23,100 and 68,686, respectively, for various accounting services and management resources. Any distributions between Laser Photonics and ICT must be distributed to affiliate company.

 

ICT Investments owns 4,688,695 shares of the Company’s common stock. Prior to the closing of the Company’s IPO on October 4, 2022, this represented 96.1% of the total shares outstanding. As of December 31, 2022, ICT Investments owns 59.5% of the total shares outstanding. Dmitriy Nikitin is the Managing Partner of ICT Investments and has controlled the Company since its inception. As of the end of 2023 the % is 58.7.%.

 

Since the date of incorporation on November 8, 2019, the Company has engaged in the following transactions with our directors, executive officers, holders of more than 5% of its voting securities, and affiliates or immediately family members of its directors, executive officers, and holders of more than 5% of our voting securities, and its co-founders. The Company believes that all these transactions were on terms as favorable as could have been obtained from unrelated third parties.

 

NOTE 6 – COMMITMENTS AND CONTINGENCIES

 

In October 2021, a lease on 18,000 SF facility was signed with the landlord for three years, terminating on October 31, 2024. The monthly rent for this facility is currently 15,109. The Company entered into a lease for additional 8000 SF of office space adjacent to the original facility for an additional 10,000/ month in October 2023. The combined expense monthly expense is 25,109.

 

In December 2022, we entered into an agreement with 2701 Maitland Building Associates to rent 8,000 sf of additional office space nearby the main facility, for our growing sales and marketing program. The monthly rent for this space is currently 14,805.

 

As of January 1, 2020, we adopted ASU 2016-02 employing the cumulative-effect adjustment transition method, resulting in the recognition on our balance sheet of 597,143 as a right-of-use asset for operating leases, 434,153 as a current operating lease liability, and 162,990 as a lease liability less the current portion.

 

The maturity amounts of our lease liabilities are as follows:

 

Schedule of Maturity of Lease Liabilities 

Year ending December 31,  Operating Leases 
2024   434,153 
2025   162,990 
Total   597,143 

 

   Three Months Ended March 31, 
   2024   2023 
           
Operating Lease Expense   79,847    90,609 

 

NOTE 7 – SUBSEQUENT EVENTS

 

The Company’s management has evaluated subsequent events up to May 20, 2024, the date the financial statements were issued, pursuant to the requirements of ASC 855 and has the following events to report.

 

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited financial statements and the notes to those financial statements appearing elsewhere in this Report.

 

Certain statements in this Report constitute forward-looking statements. These forward-looking statements include statements, which involve risks and uncertainties, regarding, among other things, (a) our projected sales, profitability, and cash flows, (b) our growth strategy, (c) anticipated trends in our industry, (d) our future financing plans, and (e) our anticipated needs for, and use of, working capital. They are generally identifiable by use of the words “may,” “will,” “should,” “anticipate,” “estimate,” “plan,” “potential,” “project,” “continuing,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend,” or the negative of these words or other variations on these words or comparable terminology. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this filing will in fact occur. You should not place undue reliance on these forward-looking statements.

 

The forward-looking statements speak only as of the date on which they are made, and, except to the extent required by federal securities laws, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events.

 

The “Company,” “we,” “us,” or “our,” are references to the business of Laser Photonics Corporation, a Wyoming corporation.

 

Overview

 

We are a vertically integrated manufacturing Company for photonics based industrial products and solutions, primarily disruptive laser cleaning technologies. Our vertically integrated operations allow us to reduce development and advanced laser equipment manufacturing time, offer better prices, control quality and protect our proprietary knowhow and technology compared to other laser cleaning companies and companies with competing technologies.

 

Our principal executive offices are located at 1101 N Keller Rd, Orlando FL, 32810, and our telephone number is (407) 804 1000. Our website address is www.laserphotonics.com. The Company’s annual reports, quarterly reports, current reports on Form 8-K and amendments to such reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”), and other information related to the Company, are available, free of charge, on that website as soon as we electronically file those documents with, or otherwise furnish them to, the SEC. The Company’s website and the information contained therein, or connected thereto, are not and are not intended to be incorporated into this Quarterly Report on Form 10-Q.

 

We intend to continue to stay ahead of the technology curve by researching and developing cutting edge products and technologies for both large and small businesses. We view the small companies as an attractive market opportunity since they were previously unable to take advantage of laser processing equipment due to high prices, significant operating costs and the technical complexities of the laser equipment. As a result, we are developing an array of laser cleaning equipment that we have named the CleanTech™ product line, which we believe represents a new generation of high-power laser cleaning systems applicable to numerous material processing operations.

 

Factors and Trends That Affect Our Operations and Financial Results

 

In reading our financial statements, you should be aware of the following factors and trends that our management believes are important in understanding our financial performance.

 

Supply Chain. We are experiencing increased lead times for certain parts and components purchased from third party suppliers; particularly electronic components. We, our customers and our suppliers continue to face constraints related to supply chain and logistics, including availability of capacity, materials, air cargo space, sea containers and higher freight rates and import duties. Supply chain and logistics constraints are expected to continue for the foreseeable future and could impact our ability to supply products and our customers’ demand for our product or readiness to accept deliveries. Notwithstanding these effects, we believe we have the ability to meet the near-term demand for our products, but the situation is fluid and subject to change.

 

Net sales. Our net sales have historically fluctuated from quarter to quarter. The increase or decrease in sales from a prior quarter can be affected by the timing of orders received from customers, the shipment, installation and acceptance of products at our customers’ facilities. Net sales can be affected by the time taken to qualify our products for use in new applications in the end markets that we serve. Our sales cycle varies substantially, ranging from a period of a few weeks to as long as one year or more, but is typically several months. The adoption of our products by a new customer or qualification in a new application can lead to an increase in net sales for a period, which may then slow until we penetrate new markets or obtain new customers.

 

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Our business depends substantially upon capital expenditures by end users, particularly by manufacturers using our products for materials processing, which includes general manufacturing, automotive including electric vehicles (EV), other transportation, aerospace, heavy industry, consumer, semiconductor and electronics. Approximately 92% of our revenues for first quarter of 2022 and 91% of our revenues for the full 2021 fiscal year were from customers using our products for materials processing. Although applications within materials processing are broad, the capital equipment market in general is cyclical and historically has experienced sudden and severe downturns. For the foreseeable future, our operations will continue to depend upon capital expenditures by end users of materials processing equipment and will be subject to the broader fluctuations of capital equipment spending.

 

Gross margin. Our total gross margin in any period can be significantly affected by a number of factors, including net sales, production volumes, competitive factors, product mix, and by other factors such as changes in foreign exchange rates relative to the U.S. Dollar. Many of these factors are not under our control. The following are examples of factors affecting gross margin:

 

● As our products mature, we can experience additional competition which tends to decrease average selling prices and affects gross margin;

 

● Our gross margin can be significantly affected by product mix. Within each of our product categories, the gross margin is generally higher for devices with greater average power. These higher power products often have better performance, more difficult specifications to attain and fewer competing products in the marketplace;

 

Selling and Marketing expenses. In the first quarter of 2024, we invested in Selling and Marketing costs in order to support continued growth in the Company. As the secular shift to laser blasting technology matures, our sales growth becomes more susceptible to the cyclical trends typical of capital equipment manufacturers. Accordingly, our future management of and investments in selling and marketing expenses will also be influenced by these trends, although we may still invest in selling and marketing functions to support sales sustainability even in economic down cycles.

 

Research and development expenses. We plan to continue to invest in research and development to improve our existing laser blasting technology and equipment and develop new products, systems and applications. We believe that these investments will sustain our position as a leader in the laser blasting industry and will support development of new products that can address new markets and growth opportunities. The amount of research and development expense we incur may vary from period to period.

 

Service of Laser Blasting Equipment

 

Results of Operations

 

Revenue of $742,991 in the three ended March 31, 2024 as compared to revenue of $676,192 in March 31, 2023, respectively, increased 9.9% the three ended March 31, 2023, respectively. The decrease year-over-year during the three quarters is from the revenue shortfall during the second quarter.

 

Gross profit for the three March 31, 2024 was $385,868, decreased to 52% gross margin compared to $406,295 in the three months ending March 31, 2023, respectively. While CleanTech made up over 80% of our mix, our gross margin declined by 810 basis points to 52%, due to more CleanTech sales coming in at the lower end of the power spectrum.

 

Selling, general, and administrative (“SG&A”) expenses consist primarily of salaries and other personnel-related costs; professional fees; insurance costs; SEC filing, compliance, and other public Company costs; travel expenses; and other sales and marketing expenses; and excludes depreciation & amortization expenses. In the near term, we expect SG&A expenses to increase as we expand our sales and marketing efforts to support the planned growth of our business. In the long run, we expect SG&A expenses as a percent of sales to decline as our business grows.

 

For the three months ended March 31, 2024, we recorded total expenses of $934,338 as compared to the three months ending in March 31,2023 of $1,305,882. SG&A expenses for the three months ended March 31, 2024, are $492,875. The significant decrease in SG&A is primarily driven by comparative ramp up of costs in 2023 to establish our strategic plan to increase market reach and sales force as part of our Sales & Marketing Development and Investment plan as noted in our previous  10-Q’s in accordance with “Use of Proceeds” as stated in our Form S-1 Registration Statement, coupled with higher personnel costs resulting from additional headcount, professional service fees, SEC compliance costs, bad debt expenses, etc.  

 

Our net loss, for the three months ended March 31, 2024, was $545,709 as compared to net loss of $1,257,605 in the same period of 2023. The decrease in Net loss is primarily due to reigning in Sales and Marketing costs as compared to prior period.

 

Liquidity and Capital Resources

 

The following is a summary of the Company’s cash flows provided and (and used in) operating, investing, and financing activities for the quarter’s ended in March 31, 2024 and March 31, 2023 

 

   Three months ended on March 31,  
   2024   2023 
Net cash provided by (used in) operating activities  $(866,258)  $(1,315,308)
Net cash provided by (used in) investing activities  $(161,755)  $(50,801)
Net cash provided by (used in) financing activities  $-   $- 
Net change in cash and cash equivalents  $(1,028,012)  $(1,366,109)
Cash at end of period  $5,173,125   $12,181,799 

 

As of March 31, 2024, the Company had 5,173,126 in cash, 2,725,064 in current assets (without cash and cash equivalents) and 1,472,368 in current liabilities.

 

As a result, on March 31, 2024, the Company had 6,425,822 in total working capital, compared to 7,814,543___ of total working capital on December 31, 2023.

 

We will have to meet all the financial disclosure and reporting requirements associated with being a publicly reporting Company. Our management will have to spend additional time on policies and procedures to make sure it is compliant with various regulatory requirements, especially that of Section 404 of the Sarbanes-Oxley Act of 2002. This additional corporate governance time required of management could limit the amount of time our management has to implement our business plan and may delay our anticipated growth plans.

 

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

 

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Revenues

 

Revenue Recognition- Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We only apply the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, we assess the goods or services promised within each contract and determine those that are performance obligations and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Refunds and returns, which are minimal, are recorded as a reduction of revenue. Payments received by customers prior to our satisfying the above criteria are recorded as unearned income in the combined balance sheets. All revenues were reported net of any sales discounts or taxes.

 

Inventory — Inventory is stated at the lower of cost (first-in, first-out method) or market value. Inventory includes parts and components that may be specialized in nature and subject to rapid obsolescence. We maintain a reserve for excess or obsolete inventory items. Inventories are written off and charged to cost of goods sold when identified as excess or obsolete. If future sales differ from these forecasts, the valuation of excess and obsolete inventory may change and additional inventory provisions may be required. Because of our vertical integration, a significant or sudden decrease in sales could result in a significant change in the estimates of excess or obsolete inventory valuation.

 

For the three months ending March 31, 2024, we recognized revenue of 742,991, as compared to 676,192 in revenue for the same period in 2023, an increase of 66,799. The increase is primarily due to a step up to higher power units, and the expansion of our reach into foreign markets.

 

   Three months ending March 31, 
   2024
(Unaudited)
   2023
(Unaudited)
 
Revenue  $742,991   $676,192 

 

For the three months ending March 31, 2024, our net income was (545,470) as compared to (1,257,605) in the same period of 2023.

 

We are entering into laser equipment sales agreements with customers for specific equipment based upon purchase orders and our standard terms and conditions of sale.

 

Under our customer contracts or/and purchase orders, we transfer title and risk of loss to the customer and recognize revenue upon shipment. Our customers do not have extended payment terms or rights of return under these contracts.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. 

 

Summary Financial Information – Non-GAAP EBITDA

 

   3 Months Ending March 31, 
   2024
(Unaudited)
   2023
(Unaudited)
 
Other financial data:          
EBITDA(1)  $(360,394)  $(1,174,468)
Adjusted EBITDA(2)  $(360,394)  $(1,174,468)

 

In addition to providing financial measurements based on generally accepted accounting principles in the United States (“GAAP”), we provide the following additional financial metrics that are not prepared in accordance with GAAP (non-GAAP): EBITDA and adjusted EBITDA. Management uses these non-GAAP financial measures, in addition to GAAP financial measures, to understand and compare operating results across accounting periods, for financial and operational decision making, for planning and forecasting purposes and to evaluate our financial performance. We believe that these non-GAAP financial measures help us to identify underlying trends in our business that could otherwise be masked by the effect of certain expenses that we exclude in the calculations of the non-GAAP financial measures.

 

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Accordingly, we believe that these non-GAAP financial measures reflect our ongoing business in a manner that allows for meaningful comparisons and analysis of trends in the business and provides useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects.

 

These non-GAAP financial measures do not replace the presentation of our GAAP financial results and should only be used as a supplement to, not as a substitute for, our financial results presented in accordance with GAAP. There are limitations in the use of non-GAAP measures, because they do not include all the expenses that must be included under GAAP and because they involve the exercise of judgment concerning exclusions of items from the comparable non-GAAP financial measure. In addition, other companies may use other non-GAAP measures to evaluate their performance, or may calculate non-GAAP measures differently, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison.

 

(1) EBITDA is a non-GAAP financial measure used by management, lenders, and certain investors as a supplemental measure in the evaluation of some aspects of a corporation’s financial position and core operating performance. Investors sometimes use EBITDA, as it allows for some level of comparability of profitability trends between those businesses differing as to capital structure and capital intensity by removing the impacts of depreciation and amortization. EBITDA also does not include changes in major working capital items, such as receivables, inventory and payables, which can also indicate a significant need for, or source of, cash. Since decisions regarding capital investment and financing and changes in working capital components can have a significant impact on cash flow, EBITDA is not necessarily a good indicator of a business’s cash flows. We use EBITDA for evaluating the relative underlying performance of our core operations and for planning purposes. We calculate EBITDA by adjusting net income to exclude net interest expense, income tax expense or benefit, depreciation and amortization, thus the term “Earnings Before Interest, Taxes, Depreciation and Amortization” and the acronym “EBITDA.”
   
(2) Adjusted EBITDA is defined as net income (loss) as reported in our consolidated statements of income excluding the impact of (i) interest expense; (ii) income tax provision; (iii) depreciation and amortization; (iv) stock-based compensation expense; (v) accretion of debt discounts; (vi) other income - forgiveness of Paycheck Protection Program loan; (vii) other financing costs; (viii) loss on extinguishment of debt; (ix) warrant inducement expense; (x) amortization of right-of-use assets; and (xi) change in fair value of derivative liabilities. Our Adjusted EBITDA measure eliminates potential differences in performance caused by variations in capital structures (affecting finance costs), tax positions, the cost and age of tangible assets (affecting relative depreciation expense) and the extent to which intangible assets are identifiable (affecting relative amortization expense). We also exclude certain one-time and non-cash costs. Our definition of Adjusted EBITDA may differ from similarly titled measures used by other companies, and any such differences could be material.

 

We believe EBITDA and Adjusted EBITDA are helpful for investors to better understand our underlying business operations. The following table adjusts Net Income to EBITDA and Adjusted EBITDA for the three months ending March 31, 2024, and 2023.

 

   Three Months Ending March 31, 
   2024
(Unaudited)
   2023
(Unaudited)
 
Reconciliation of EBITDA:          
Net Income (Loss)  $(545,709)  $(1,257,605)
Add (deduct):          
Interest expense   -    - 
Taxes   -    - 
Other   -    - 
Depreciation & Amortization   185,316    83,137 
EBITDA(1)   (360,394)   (1,174,468)
Other adjustments  $-   $- 
Adjusted EBITDA(2)  $(360,394)  $(1,174,468)

 

Subsequent Events

 

None

 

Off-Balance Sheet Arrangements

 

As of March 31, 2024, we did not have any off-balance sheet arrangements.

 

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Pursuant to Item 305(e) of Regulation S-K (§ 229.305(e)), the Company is not required to provide the information required by this Item as it is a “smaller reporting Company,” as defined by Rule 229.10(f)(1).

 

We have not utilized any derivative financial instruments such as futures contracts, options and swaps, forward foreign exchange contracts or interest rate swaps and futures. We believe that adequate controls are in place to monitor any hedging activities. We do not have any borrowings and, consequently, we are not affected by changes in market interest rates. We do not currently have any sales or own assets and operate facilities in countries outside the United States and, consequently, we are not affected by foreign currency fluctuations or exchange rate changes. Overall, we believe that our exposure to interest rate risk and foreign currency exchange rate changes is not material to our financial condition or results of operations.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Disclosures Control and Procedures

 

Under the supervision of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), our management has evaluated the effectiveness of the design and operation of our “disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Quarterly Report on Form 10-Q (the “Evaluation Date”). Based upon that evaluation, our CEO and CFO have concluded that, as of the Evaluation Date, our disclosure controls and procedures are not effective. Management is implementing controls and procedures during 2024 to bring to effective.

 

Changes in Internal Controls over Financial Reporting

 

There was no material change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act) that occurred during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

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PART II – OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS.

 

We are not involved in any legal proceedings, including routine litigation arising in the normal course of business that we believe will have a material adverse effect on our business, financial condition or results of operations.

 

ITEM 1A. RISK FACTORS

 

Not applicable to a smaller reporting Company.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

There were no sales of unregistered securities during the reported period.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES.

 

Not applicable.

 

ITEM 5. OTHER INFORMATION.

 

None.

 

ITEM 6. EXHIBITS.

 

31.1   Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer
     
31.2   Rule 13(a)-14(a)/15(d)-14(a) Certification of principal financial and accounting officer
     
32.1   Section 1350 Certification of principal executive officer
     
32.2   Section 1350 Certification of principal financial and accounting officer
     
101*   Inline XBRL data files of Financial Statements and Notes contained in this Quarterly Report on Form 10-Q.

 

* In accordance with Regulation S-T, the Interactive Data Files in Exhibit 101 to the Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed.”

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

  Laser Photonics Corporation
   
Date: May 21, 2024 By: /s/ Wayne Tupuola
   

President and Chief Executive Officer

(Principal Executive Officer)

 

Date: May 21, 2024 By /s/ Carlos Sardinas
    Chief Financial Officer
    (Principal Financial and Accounting Officer)

 

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