Precision Optics Reports First Quarter Fiscal Year 2024 Financial Results

Conference Call Scheduled for today, November 14, 2023, at 5:00pm ET.

GARDNER, Mass., Nov. 14, 2023 /PRNewswire/ -- Precision Optics Corporation, Inc. (NASDAQ: POCI), a leading designer and manufacturer of advanced optical instruments for the medical and defense industries, announced operating results on an unaudited basis for its first quarter fiscal year 2024 for the period ended September 30, 2023.

Q1 2024 Financial Highlights (3 Months Ended September 30, 2023):

• Revenue decreased 15% to $4.3 million, compared to $5.1 million in the same quarter of the previous fiscal year.
• Production revenue was $2.4 million compared to $3.4 million in the same quarter of the previous fiscal year.
• Engineering revenue was $1.9 million compared to $1.6 million in the same quarter of the previous fiscal year.
• Gross margins were 33.9% compared to 32.2% in the same quarter of the previous year.
• Net loss for the quarter was ($464,415), compared to a net loss of ($158,724) in the same quarter of the previous year. 
• Adjusted EBITDA was ($244,983) for the quarter compared to $25,599 in the same quarter of the previous year. 

Recent Additional Highlights:

• In November 2023, the Company announced the receipt of an $890,000 initial production order for a complex imaging sub-assembly that will be used in the customer's new robotic laparoscopy system. The imaging subassembly incorporates cutting edge optical, electronic, and mechanical systems designed by Precision Optics.
• In October 2023, the Company announced the receipt of an initial production order from a top tier defense/aerospace company totaling $680,000 addressing a new commercial application leveraging the Company's manufacturing IP developed for high precision micro-optics technology.

Precision Optics' CEO, Joseph Forkey, commented, "As anticipated and discussed last quarter, the decline in revenue was attributable to timing differences between the exit of certain mature customer programs, reorders for ongoing products and the introduction of new customer programs, primarily in the areas of medical endoscopes, including single-use devices and new defense / aerospace commitments.  Revenue was also impacted by lower order volumes of optical components from our Ross Optical operation as customers sought to rebalance their inventories which had previously grown beyond sustainable levels due to increased ordering in response to concerns about supply chain disruptions. We believe reduced customer demand to be transient, and we have already seen a second quarter recovery in revenue levels both with Ross Optical and in production. We continue to believe that revenue growth should accelerate in the second half of this fiscal year as new programs enter commercial production.  Customer programs we're producing have the market potential to support substantial Precision Optics growth."

Dr. Forkey continued, "During the first quarter, engineering revenue was close to the previous quarter's record level and was up 16% compared to the same quarter a year ago. We are starting to see the positive results of the strong engineering pipeline we have had for some time now, as new programs are beginning to move to production, including two programs that we just announced in the last month. We continue to focus on building sustainable value in the business by engaging with customers at the onset of engineering through to commercial production, leveraging our unique technical resources and manufacturing capabilities to bring innovative new applications to market. Our engineering pipeline remains robust and we look forward to sustained growth in Fiscal 2024 and beyond."

The following table summarizes the fourth quarter and fiscal year (unaudited) results for the periods ended September 30, 2023, and 2022:

Conference Call Details
Date and Time: Tuesday, November 14, 2023, at 5:00pm ET

Call-in Information: Interested parties can access the conference call by dialing (844) 735-3662 or
(412) 317-5705.

Live Webcast Information: Interested parties can access the conference call via a live webcast, which is available at https://app.webinar.net/q7ndVdGzwyJ.   

Replay: A teleconference replay of the call will be available until November 21, 2023, at (877) 344-7529 or (412) 317-0088, replay access code 1146933. A webcast replay will be available at https://app.webinar.net/q7ndVdGzwyJ.   

About Precision Optics Corporation
Founded in 1982, Precision Optics is a vertically integrated optics company primarily focused on leveraging its proprietary micro-optics and 3D imaging technologies to the healthcare and defense/aerospace industries by providing services ranging from new product concept through mass manufacture.  Utilizing its leading-edge in-house design, prototype, regulatory and fabrication capabilities as well as its Lighthouse Imaging division's electronic imaging expertise and its Ross Optical division's high volume world-wide sourcing, inspecting and production resources, the Company is able to design and manufacture next-generation product solutions to the most challenging customer requirements. Within healthcare, Precision Optics enables next generation medical device companies around the world to meet the increasing demands of the surgical community who require more enhanced and smaller imaging systems for minimally invasive surgery as well as 3D endoscopy systems to support the rapid proliferation of surgical robotic systems. In addition to these next generation applications, Precision Optics has supplied top tier medical device companies a wide variety of optical products for decades, including complex endocouplers and specialized endoscopes. The Company is also leveraging its technical proficiency in micro-optics to enable leading edge defense/aerospace applications which require the highest quality standards and the optimization of size, weight and power. For more information, please visit www.poci.com.

Non-GAAP Financial Measures

Precision Optics has provided in this press release financial information that has not been prepared in accordance with accounting principles generally accepted in the Unites States of America ("non-GAAP"). The non-GAAP financial measure is Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization). Adjusted EBITDA also excludes from Net Income (Loss) the effect of stock-based compensation, restructuring and other acquisition-related items.

This non-GAAP financial measure assists Precision Optics management in comparing its operating performance over time because certain items may obscure the underlying business trends and make comparisons of long-term performance difficult, as they are of a nature and/or size that occur with inconsistent frequency or relate to discrete acquisition or restructuring plans that are fundamentally different from the ongoing productivity of the Company. Precision Optics management also believes that presenting this measure allows investors to view its performance using the same measures that the Company uses in evaluating its financial and business performance and trends.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information calculated in accordance with GAAP. Investors are encouraged to review the reconciliation of non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of the non-GAAP financial measure presented above to GAAP results has been provided in the financial tables included with this press release.

About Forward-Looking Statements

This press release contains forward-looking statements. Forward-looking statements include, but are not limited to, statements that express the Company's intentions, beliefs, expectations, strategies, predictions or any other statements related to the Company's future activities or future events or conditions. These statements are based on current expectations, estimates and projections about the Company's business based, in part, on assumptions made by the Company's management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including those risks discussed in the Company's annual report on Form 10-K and in other documents that we file from time to time with the SEC. Any forward-looking statements speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement, except as required by law.

Company Contact:                                                    
PRECISION OPTICS CORPORATION
22 East Broadway
Gardner, Massachusetts 01440-3338
Telephone: 978-630-1800

Investor Contact:
LYTHAM PARTNERS, LLC
Robert Blum
Telephone: 602-889-9700
[email protected]

Following are the Company's Consolidated Balance Sheets at September 30, 2023 and June 30, 2023, and Statements of Cash Flows, for the three months ended September 30, 2023 and 2022:

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SOURCE Precision Optics Corporation