New Jersey | 001-36632 | 22-2746503 |
State of Incorporation | Commission File Number | IRS Employer Identification Number |
Item 2.02 | Results of Operations and Financial Condition. |
Exhibit Number | Exhibit Description | |
99.1 | Press Release, dated December 11, 2014, issued by EMCORE Corporation. |
EMCORE CORPORATION | |
Dated: December 11, 2014 | By: /s/ Mark B. Weinswig Name: Mark B. Weinswig Title: Chief Financial Officer |
• | Consolidated Q4 revenue of $43.7 million |
• | Consolidated Q4 GAAP net income of $15.5 million, after taking into effect $24.1 million of income tax benefit |
• | Consolidated revenue and net income for Fiscal Year 2014 of $174.8 million and $4.9 million, respectively |
• | Transaction of Space Photovoltaics segment divestiture completed on December 10, 2014 |
• | Telecom product line divestiture expected to close in January 2015 |
• | Anticipate Q1 revenue of $17 to $19 million for the remaining Broadband Fiber Optics business and non-GAAP net loss of approximately $1 to $2 million |
Financial Highlights | For the Three Months Ended | |||||||||||||||||||||||||||||||||||
(in thousands) | September 30, 2014 | June 30, 2014 | September 30, 2013 | |||||||||||||||||||||||||||||||||
Fiber | Solar | Consolidated | Fiber | Solar | Consolidated | Fiber | Solar | Consolidated | ||||||||||||||||||||||||||||
Revenue | $ | 28,468 | $ | 15,270 | $ | 43,738 | $ | 26,172 | $ | 18,410 | $ | 44,582 | $ | 22,609 | $ | 20,482 | $ | 43,091 | ||||||||||||||||||
Gross Profit | $ | 3,147 | $ | 3,133 | $ | 6,280 | $ | 4,288 | $ | 5,105 | $ | 9,393 | $ | 2,613 | $ | 2,760 | $ | 5,373 | ||||||||||||||||||
Operating (loss) income | $ | (6,417 | ) | $ | (2,071 | ) | $ | (8,488 | ) | $ | (5,092 | ) | $ | 1,961 | $ | (3,131 | ) | $ | (6,882 | ) | $ | (246 | ) | $ | (7,128 | ) |
• | Consolidated revenue was $43.7 million, representing a 1.9% decrease from the immediate preceding quarter |
• | Fiber Optics revenues increased 8.8% to $28.5 million, and Photovoltaics revenue decreased 17.1% to $15.3 million over the immediate preceding quarter |
• | Consolidated gross margin was 14.4%, a decrease from the 21.1% gross margin reported in the immediate preceding quarter |
• | On a segment basis, Fiber Optics gross margin decreased to 11.1% from the 16.4% gross margin reported in the immediate preceding quarter due to an excess and obsolete inventory reserve of $2.8 million and Photovoltaics gross margin decreased to 20.5% from the 27.7% gross margin reported in the immediate preceding quarter |
• | Increase in the SG&A due to expenses associated with the announced divestitures and severance costs |
• | Consolidated operating loss was $8.5 million, a $5.4 million increase when compared to the immediate preceding quarter |
• | A deferred tax valuation allowance release of $24.1 million was recorded as an income tax benefit during the fourth quarter of 2014. We expect that substantially all of the $24.1 million benefit in deferred tax assets will be used in fiscal year 2015 when income tax expense is recorded in fiscal year 2015 as a result of the sale of the Photovoltaics business |
• | Consolidated net income was $15.5 million, an $18.6 million increase when compared to the immediate preceding quarter |
• | Consolidated net income per share was $0.50 compared to a net loss per share of $0.10 in the immediate preceding quarter |
• | Non-GAAP net loss was $1.2 million, or $0.04 per share, an inprovement of approximately $0.4 million over the immediate preceding quarter |
• | Cash and cash equivalents was $20.7 million at the end of the fourth quarter, an increase of $2.5 million when compared to the immediate preceding quarter |
Financial Highlights | For the Fiscal Years Ended | |||||||||||||||||||||||
(in thousands) | September 30, 2014 | September 30, 2013 | ||||||||||||||||||||||
Fiber | Solar | Consolidated | Fiber | Solar | Consolidated | |||||||||||||||||||
Revenue | $ | 101,552 | $ | 73,226 | $ | 174,778 | $ | 96,977 | $ | 71,170 | $ | 168,147 | ||||||||||||
Gross Profit | $ | 11,765 | $ | 20,909 | $ | 32,674 | $ | 9,835 | $ | 18,363 | $ | 28,198 | ||||||||||||
Operating (loss) income | $ | (25,400 | ) | $ | 6,292 | $ | (19,108 | ) | $ | (8,382 | ) | $ | 8,602 | $ | 220 |
• | Consolidated revenue was $174.8 million, representing a 3.9% increase compared to the prior year |
• | Fiber Optics revenues increased 4.7% over the prior year to $101.6 million, and Photovoltaics revenue increased 2.9% to $73.2 million compared to the prior year |
• | Consolidated gross margin was 18.7%, an increase from the 16.8% gross margin reported in the prior year |
• | On a segment basis, Fiber Optics gross margin increased to 11.6% from the 10.1% gross margin reported in the prior year and Photovoltaics gross margin increased to 28.6% from the 25.8% gross margin reported in the prior year |
• | Consolidated operating loss was $19.1 million, a $19.3 million decline when compared to the prior year |
• | A net deferred tax valuation allowance release of $24.1 million was recorded as an income tax benefit during fiscal year 2014. We expect that substantially all of the $24.1 million benefit in deferred tax assets will be used in fiscal year 2015 when income tax expense is recorded as a result of the sale of the Photovoltaics business |
• | Consolidated net income was $4.9 million, a $0.1 million decline when compared to the prior year |
• | Consolidated net income per share was $0.16 compared to a net income per share of $0.19 reported in the prior year |
• | Non-GAAP net loss was $5.8 million, or $0.19 per share, an improvement of approximately $6.3 million, over the prior year |
• | Cash and cash equivalents was $20.7 million at the year end, an increase of $4.6 million when compared to the prior year |
For the Three Months Ended | For the Fiscal Years Ended | ||||||||||||||||||
September 30, 2014 | June 30, 2014 | September 30, 2013 | September 30, 2014 | September 30, 2013 | |||||||||||||||
Revenue | $ | 43,738 | $ | 44,582 | $ | 43,091 | $ | 174,778 | $ | 168,147 | |||||||||
Cost of revenue | 37,458 | 35,189 | 37,718 | 142,104 | 139,949 | ||||||||||||||
Gross profit | 6,280 | 9,393 | 5,373 | 32,674 | 28,198 | ||||||||||||||
Operating expense (income): | |||||||||||||||||||
Selling, general, and administrative | 10,059 | 7,843 | 6,705 | 32,785 | 27,419 | ||||||||||||||
Research and development | 4,809 | 4,681 | 5,796 | 19,097 | 19,972 | ||||||||||||||
Flood-related insurance proceeds | — | — | — | — | (19,000 | ) | |||||||||||||
Gain on sale of assets | (100 | ) | — | — | (100 | ) | (413 | ) | |||||||||||
Total operating expense | 14,768 | 12,524 | 12,501 | 51,782 | 27,978 | ||||||||||||||
Operating (loss) income | (8,488 | ) | (3,131 | ) | (7,128 | ) | (19,108 | ) | 220 | ||||||||||
Other income (expense): | |||||||||||||||||||
Interest expense, net | (145 | ) | (134 | ) | (191 | ) | (522 | ) | (800 | ) | |||||||||
Foreign exchange (loss) gain | (5 | ) | 5 | 95 | 10 | 356 | |||||||||||||
Gain on sale of equity interest | — | — | 4,800 | — | 4,800 | ||||||||||||||
Gain on sale of investment | — | — | — | 307 | — | ||||||||||||||
Change in fair value of financial instruments | (5 | ) | 110 | 172 | 34 | 515 | |||||||||||||
Other expense | 51 | — | — | 51 | 17 | ||||||||||||||
Total other (expense) income | (104 | ) | (19 | ) | 4,876 | (120 | ) | 4,888 | |||||||||||
(Loss) income before income tax expense | (8,592 | ) | (3,150 | ) | (2,252 | ) | (19,228 | ) | 5,108 | ||||||||||
Income tax benefit (expense) | 24,080 | — | — | 24,080 | (120 | ) | |||||||||||||
Net income (loss) | $ | 15,488 | $ | (3,150 | ) | $ | (2,252 | ) | $ | 4,852 | $ | 4,988 | |||||||
Per share data: | |||||||||||||||||||
Net income (loss) per basic share | $ | 0.50 | $ | (0.10 | ) | $ | (0.08 | ) | $ | 0.16 | $ | 0.19 | |||||||
Net income (loss) per diluted share | $ | 0.50 | $ | (0.10 | ) | $ | (0.08 | ) | $ | 0.16 | $ | 0.19 | |||||||
Weighted-average number of basic shares outstanding | 30,752 | 30,656 | 27,158 | 30,453 | 26,531 | ||||||||||||||
Weighted-average number of diluted shares outstanding | 30,992 | 30,656 | 27,158 | 30,777 | 26,812 |
As of | As of | ||||||
September 30, 2014 | September 30, 2013 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 20,687 | $ | 16,104 | |||
Restricted cash | 1,482 | 815 | |||||
Accounts receivable, net | 44,864 | 41,826 | |||||
Inventory | 26,072 | 32,115 | |||||
Deferred income taxes, net | 3,908 | — | |||||
Prepaid expenses and other current assets | 6,878 | 9,437 | |||||
Total current assets | 103,891 | 100,297 | |||||
Property, plant, and equipment, net | 44,987 | 49,744 | |||||
Goodwill | 20,384 | 20,384 | |||||
Other intangible assets, net | 1,142 | 2,159 | |||||
Deferred income taxes, net | 20,172 | — | |||||
Other non-current assets, net | 766 | 1,130 | |||||
Total assets | $ | 191,342 | $ | 173,714 | |||
LIABILITIES and SHAREHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Borrowings from credit facility | $ | 26,518 | $ | 21,706 | |||
Accounts payable | 22,292 | 19,643 | |||||
Deferred gain associated with sale of assets | 3,400 | — | |||||
Warrant liability | 122 | 155 | |||||
Accrued expenses and other current liabilities | 20,645 | 21,597 | |||||
Total current liabilities | 72,977 | 63,101 | |||||
Asset retirement obligations | 5,263 | 5,053 | |||||
Deferred gain associated with sale of assets | — | 3,400 | |||||
Other long-term liabilities | 755 | 981 | |||||
Total liabilities | 78,995 | 72,535 | |||||
Shareholders’ equity: | |||||||
Common stock | 755,368 | 749,266 | |||||
Treasury stock | (2,071 | ) | (2,071 | ) | |||
Accumulated other comprehensive income | 1,837 | 1,623 | |||||
Accumulated deficit | (642,787 | ) | (647,639 | ) | |||
Total shareholders’ equity | 112,347 | 101,179 | |||||
Total liabilities and shareholders’ equity | $ | 191,342 | $ | 173,714 |
For the Three Months Ended | For the Fiscal Years Ended | ||||||||||||||||||
September 30, 2014 | June 30, 2014 | September 30, 2013 | September 30, 2014 | September 30, 2013 | |||||||||||||||
Net income (loss) - US GAAP | $ | 15,488 | $ | (3,150 | ) | $ | (2,252 | ) | $ | 4,852 | $ | 4,988 | |||||||
Adjustments: | |||||||||||||||||||
Amortization expense | 254 | 254 | 317 | 1,017 | 1,269 | ||||||||||||||
Stock-based compensation expense | 1,020 | 1,180 | 924 | 4,439 | 4,209 | ||||||||||||||
Income tax (benefit) expense | (24,080 | ) | — | — | (24,080 | ) | 120 | ||||||||||||
Asset retirement obligations - accretion expense | 53 | 52 | 54 | 210 | 215 | ||||||||||||||
Specific severance and restructuring charges | 1,238 | 179 | 230 | 2,229 | 652 | ||||||||||||||
Flood-related insurance proceeds | — | — | — | — | (19,000 | ) | |||||||||||||
Gain on sale of assets | (100 | ) | — | — | (100 | ) | (338 | ) | |||||||||||
Losses on inventory purchase commitments | 306 | — | — | 306 | — | ||||||||||||||
Transaction costs | 1,782 | — | — | 1,782 | — | ||||||||||||||
Specific E&O charges | 2,823 | — | — | 2,823 | — | ||||||||||||||
Specific warranty charges | — | — | — | 1,045 | 1,425 | ||||||||||||||
Foreign exchange loss (gain) | 5 | (5 | ) | (95 | ) | (10 | ) | (356 | ) | ||||||||||
Gain on sale of investment | — | — | (4,800 | ) | (307 | ) | (4,800 | ) | |||||||||||
Change in fair value of financial instruments | 5 | (110 | ) | (172 | ) | (34 | ) | (515 | ) | ||||||||||
Total adjustments | (16,694 | ) | 1,550 | (3,542 | ) | (10,680 | ) | (17,119 | ) | ||||||||||
Net loss - Non-GAAP | $ | (1,206 | ) | $ | (1,600 | ) | $ | (5,794 | ) | $ | (5,828 | ) | $ | (12,131 | ) | ||||
Net loss - Non-GAAP per basic share | $ | (0.04 | ) | $ | (0.05 | ) | $ | (0.21 | ) | $ | (0.19 | ) | $ | (0.46 | ) | ||||
Net loss - Non-GAAP per diluted share | $ | (0.04 | ) | $ | (0.05 | ) | $ | (0.21 | ) | $ | (0.19 | ) | $ | (0.46 | ) | ||||
Weighted average number of basic shares outstanding | 30,752 | 30,656 | 27,158 | 30,453 | 26,531 | ||||||||||||||
Weighted average number of diluted shares outstanding | 30,752 | 30,656 | 27,158 | 30,453 | 26,531 |
Stock-based Compensation Expense | For the Three Months Ended | For the Fiscal Years Ended | |||||||||||||||||
(in thousands) | September 30, 2014 | June 30, 2014 | September 30, 2013 | September 30, 2014 | September 30, 2013 | ||||||||||||||
Cost of revenue | $ | 215 | $ | 254 | $ | 227 | $ | 900 | $ | 1,143 | |||||||||
Selling, general, and administrative | 545 | 607 | 428 | 2,372 | 1,754 | ||||||||||||||
Research and development | 260 | 319 | 269 | 1,167 | 1,312 | ||||||||||||||
Total stock-based compensation expense | $ | 1,020 | $ | 1,180 | $ | 924 | $ | 4,439 | $ | 4,209 | |||||||||
D!\@'Z`@,"#`(4`AT"
M)@(O`C@"00)+`E0"70)G`G$">@*$`HX"F`*B`JP"M@+!`LL"U0+@`NL"]0,`
M`PL#%@,A`RT#.`-#`T\#6@-F`W(#?@.*`Y8#H@.N`[H#QP/3`^`#[`/Y!`8$
M$P0@!"T$.P1(!%4$8P1Q!'X$C`2:!*@$M@3$!-,$X03P!/X%#044%]@8&!A8&)P8W!D@&609J!GL&C`:=!J\&
MP`;1!N,&]0<'!QD'*P<]!T\'80=T!X8'F0>L![\'T@?E!_@("P@?"#((1@A:
M"&X(@@B6"*H(O@C2".<(^PD0"24).@E/"60)>0F/":0)N@G/">4)^PH1"B<*
M/0I4"FH*@0J8"JX*Q0K<"O,+"PLB"SD+40MI"X`+F`NP"\@+X0OY#!(,*@Q#
M#%P,=0R.#*<,P`S9#/,-#0TF#4`-6@UT#8X-J0W##=X-^`X3#BX.20YD#G\.
MFPZV#M(.[@\)#R4/00]>#WH/E@^S#\\/[!`)$"800Q!A$'X0FQ"Y$-<0]1$3
M$3$13Q%M$8P1JA')$>@2!Q(F$D429!*$$J,2PQ+C$P,3(Q-#$V,3@Q.D$\43
MY10&%"<4211J%(L4K13.%/`5$A4T%585>!6;%;T5X!8#%B86219L%H\6LA;6
M%OH7'1=!%V47B1>N%](7]Q@;&$`891B*&*\8U1CZ&2`911EK&9$9MQG=&@0:
M*AI1&G<:GAK%&NP;%!L[&V,;BANR&]H<`APJ'%(<>QRC',P<]1T>'4<=:AZ4'KX>Z1\3'SX?:1^4'[\?ZB`5($$@;""8(,0@\"$<(4@A
M=2&A(