StockerYale Announces First Quarter Financial Results
May 7, 2002
Salem, NH -- StockerYale, Inc., (NASDAQ: STKR), a leading provider of phase masks, specialty optical fiber, advanced optical technologies, and specialized illumination products, announced financial results for the first quarter of fiscal 2002.
"While first quarter sales declined 14% when compared to fourth quarter 2001, our first quarter illumination sales managed to rise 4% over the previous quarter, signaling what we believe is a turnaround in that segment of our business," said Mark W. Blodgett, StockerYale's chairman and chief executive officer. "We also made significant progress in reducing our overall expenses compared to the previous quarter, as SG&A and R&D expenses declined 18%." Blodgett added.
Commenting on the future, Blodgett said, "We continue to focus on both innovative product development utilizing our new R&D/manufacturing facilities and increased efficiencies in our overall operations. As of the end of April, new products resulted in a 22% increase in backlog over the fourth quarter 2001, and we expect this trend to continue as diffraction gratings and optical fibers begin to contribute to sales growth for our optical business. As a result, we expect ongoing improvements in our operating results as we move through 2002."
Outlook
Frank O'Brien, StockerYale's executive vice president and chief financial officer stated; "StockerYale has implemented various financial controls, management information systems, and cost containment measures that will contribute to improved operating performance for the remainder of 2002. Specifically, the company converted its Salem-based ERP system in Canada during the first quarter, facilitating a $1 million annual cost savings by rationalizing manufacturing, inventory, and purchasing overhead, which will be realized starting in the second quarter."
O'Brien continued; "During the first quarter StockerYale completed a private placement of $9.7 million which will be used to fund general corporate operating programs. The first quarter witnessed a significant reduction in operating losses versus the fourth quarter 2001, and given the recent cost reductions as well as renewed strength in orders, especially for illumination products, revenues and operating results should improve throughout the remainder of 2002."
Quarterly Comparisons
StockerYale's business and financial model has changed significantly over the past year making quarterly comparisons difficult; however, the discussion below provides a brief analysis of the major comparative data for the first quarters of 2001 and 2002.
Revenues
For the quarter ended March 31, 2002, net sales declined $2 million or 41% from $4.9 million in 2001 to $2.9 million. The slowdown in the semiconductor, electronic assembly, and telecommunication industries, which impacted StockerYale beginning in the second quarter of 2001, resulted in revenue declines in the illumination and optical component businesses.
Gross Profits
Gross profits declined from 45% to 11% in the first quarter of 2001 compared to the first quarter of 2002 due to unabsorbed overhead costs related to the revenue decline as well as higher depreciation and staffing costs directly associated with our investment in the optical components business.
Operating Expenses
Operating expenses increased from $2.7 million in the first quarter of 2001 to $4.7 million in the first quarter of 2002 primarily due to salaries, benefits and prototype development costs associated with an increase in headcount and infrastructure to support the R&D efforts in the specialty optical fiber and optical components businesses.
The net loss was $4,495,000 or $0.36 per share for the first quarter of 2002 compared to a net loss of $625,000 or $0.07 per share for the first quarter of 2001.
Liquidity & Capital Resources
Our cash position of $8.2 million as of March 31,2002 represented a $4.6 million increase compared to December 31, 2001. The liquidity improvement was the result of the private placement coupled with significantly reduced capital expenditures more than offsetting the first quarter operating loss.
Conference Call Information
The company will host a conference call at 11:00 a.m. EDT on Tuesday, May 7, 2002. To access the call, dial 800-558-9407. The teleconference will also be simultaneously webcast and can be accessed through the company's website, http://www.stockeryale.com/investor/earnings.htm. The webcast will be archived for 30 days following the call and can be accessed by visiting the above mentioned web address.
About StockerYale
StockerYale, Inc. headquartered in Salem, NH, in an independent designer and manufacturer of phase masks, specialty optical fiber, and advanced optical sub-components used in the building of optical networks as well as structured light lasers, specialized fiber optic, fluorescent, and LED illumination products for the machine vision, industrial inspection, medical and military markets.
StockerYale serves a widely varied, international customer base from its corporate offices in Salem and reinvests a significant percentage of its revenues in R&D to meet the future requirements of its customers. StockerYale has offices and subsidiaries in the U.S., Canada, Europe, and the Pacific Rim.
For more information about StockerYale and their innovative products, contact StockerYale, Inc., 32 Hampshire Rd., Salem, NH, 03079. Call 800-843-8011; Fax 603-893-5604; or e-mail . Information is also available on the company's web site at www.stockeryale.com.
Notice to Investors:
This press release contains forward-looking statements that do not give full weight to all the potential risks, but relate to StockerYale's plans, objectives, and expectations, which are dependent upon a number of factors outside of StockerYale's control including, but not limited to: uncertainty that StockerYale's new optical communications sub-components and specialized illumination products anticipated to be released later in 2002 will gain market acceptance; the risk that delays and unanticipated expenses in developing new products could delay the commercial release of those products and affect revenue estimates; the risk that one of our competitors could develop and bring to market a technology that is superior to those products that we are currently developing; and StockerYale's ability to capitalize on its significant research and development efforts by bringing to market successful products in the optical communications sub-components and specialized illumination markets. You should also refer to the discussion under "Certain Factors Affecting Operating Results" in StockerYale's form 10K for additional matters to be considered in this regard. Thus, actual results may differ materially. StockerYale undertakes no duty to update any of these forward-looking statements.
Contact for Press and Analysts:
Fred Pilon, Dir. Investor Relations
StockerYale
603-870-8229
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 relating to, among other things, the Company's future operating results and sales trends. Reliance should not be placed on forward looking statements because they involve known and unknown risks, uncertainties and other factors which are in some cases, beyond the control of Stocker & Yale, which may cause the actual results, performance or achievements of the Company to differ materially from anticipated future results, performance or achievements expressed or implied by such forward looking statements.
| Consolidated Statements
of Operations In thousands (except per share data) |
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Three Months Ended March 31, | |||||||
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2002 |
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2001 |
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| Net Sales | |
$ 2,908 | $ 4,925 | |||||
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| Cost of Sales | 2,584 | 2,701 | ||||||
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| Gross Profit | 324 | 2,224 | ||||||
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| R&D Expenses | 1,764 | 611 | ||||||
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| Selling, General & Administrative Expenses | 2,891 | 2,100 | ||||||
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| Amortization of Goodwill and Intangible Assets | 88 | 171 | ||||||
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| Operating Income/(Loss) | (4,419) | (658) | ||||||
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| Interest & Other Income/(Expense) | 9 | 236 | ||||||
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| Interest Expense | 85 | 110 | ||||||
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| Pretax Income/(Loss) | (4,495) | (532) | ||||||
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| Tax Provision/(Benefit) | 0 | 93 | ||||||
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| Net Income/(Loss) | $ (4,495) | $ (625) | ||||||
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| Earnings/(Loss) per Share | $ (0.36) | $ (0.07) | ||||||
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| Weighted Average Shares Outstanding | |
12,475,382 | |
9,404,561 | ||||
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| Consolidated Condensed
Balance Sheets $ (In thousands) |
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March 31, 2002 | Dec. 31, 2001 | |||
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| Total Cash | $ 8,195 | $ 3,576 | |||
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| Accounts Receivable, Net | 2,547 | 2,091 | |||
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| Inventory | 5,009 | 5,224 | |||
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| Total Current Assets | 16,514 | 11,969 | |||
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| Property, Plant & Equipment, Net | 25,471 | 25,813 | |||
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| $ 47,345 | $ 43,360 | ||||
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| Current Liabilities | $ 8,119 | $ 9,281 | |||
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| Total Liabilities | 11,932 | 13,335 | |||
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| Stockholders Investment | 35,413 | 30,025 | |||
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| $ 47,345 | $ 43,360 | ||||