2016 Q1 Form 10-Q Financial Statement

#000077126616000076 Filed on May 04, 2016

View on sec.gov

Income Statement

Concept 2016 Q1 2015 Q1
Revenue $6.119M $8.585M
YoY Change -28.72% 0.0%
Cost Of Revenue $4.636M $5.284M
YoY Change -12.26% 25.05%
Gross Profit $1.342M $1.857M
YoY Change -27.73% 0.65%
Gross Profit Margin 21.93% 21.63%
Selling, General & Admin $3.761M $4.386M
YoY Change -14.26% -12.22%
% of Gross Profit 280.24% 236.2%
Research & Development $4.040M $4.860M
YoY Change -16.88% -4.45%
% of Gross Profit 301.04% 261.72%
Depreciation & Amortization $340.0K $680.0K
YoY Change -50.0% -26.88%
% of Gross Profit 25.34% 36.62%
Operating Expenses $7.801M $9.246M
YoY Change -15.63% -8.3%
Operating Profit -$6.318M -$5.945M
YoY Change 6.27% -38.16%
Interest Expense -$340.0K $2.170M
YoY Change -115.67% 416.67%
% of Operating Profit
Other Income/Expense, Net -$376.1K $2.192M
YoY Change -117.16% 356.9%
Pretax Income -$6.694M -$3.753M
YoY Change 78.35% -58.91%
Income Tax $141.0K $12.50K
% Of Pretax Income
Net Earnings -$6.932M -$3.885M
YoY Change 78.43% 1.22%
Net Earnings / Revenue -113.29% -45.25%
Basic Earnings Per Share -$0.11 -$0.06
Diluted Earnings Per Share -$0.11 -$0.06
COMMON SHARES
Basic Shares Outstanding 63.98M shares 63.08M shares
Diluted Shares Outstanding 63.98M shares 63.08M shares

Balance Sheet

Concept 2016 Q1 2015 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $90.87M $89.66M
YoY Change 1.34% -15.53%
Cash & Equivalents $27.62M $14.98M
Short-Term Investments $63.25M $74.69M
Other Short-Term Assets $800.0K $900.0K
YoY Change -11.11% 12.5%
Inventory $2.706M $3.654M
Prepaid Expenses
Receivables $1.661M $4.421M
Other Receivables $0.00 $14.90M
Total Short-Term Assets $96.11M $111.2M
YoY Change -13.56% -0.47%
LONG-TERM ASSETS
Property, Plant & Equipment $2.713M $4.247M
YoY Change -36.12% -20.63%
Goodwill $928.1K $947.5K
YoY Change -2.05% -7.33%
Intangibles $462.6K
YoY Change -65.54%
Long-Term Investments
YoY Change
Other Assets $711.3K $2.367M
YoY Change -69.94% -14.99%
Total Long-Term Assets -$96.01M $8.023M
YoY Change -1296.65% -68.39%
TOTAL ASSETS
Total Short-Term Assets $96.11M $111.2M
Total Long-Term Assets -$96.01M $8.023M
Total Assets $99.81K $119.2M
YoY Change -99.92% -13.05%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $4.440M $3.525M
YoY Change 25.97% -15.03%
Accrued Expenses $4.600M $4.800M
YoY Change -4.17% 4.35%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $11.73M $12.00M
YoY Change -2.22% 10.59%
LONG-TERM LIABILITIES
Long-Term Debt $0.00 $0.00
YoY Change
Other Long-Term Liabilities $300.0K $300.0K
YoY Change 0.0% 0.0%
Total Long-Term Liabilities $300.0K $300.0K
YoY Change 0.0% 0.0%
TOTAL LIABILITIES
Total Short-Term Liabilities $11.73M $12.00M
Total Long-Term Liabilities $300.0K $300.0K
Total Liabilities $11.90M $11.80M
YoY Change 0.85% 5.36%
SHAREHOLDERS EQUITY
Retained Earnings -$197.5M -$179.8M
YoY Change 9.89% 14.61%
Common Stock $327.9M $326.3M
YoY Change 0.51% 1.1%
Preferred Stock
YoY Change
Treasury Stock (at cost) $42.74M $42.74M
YoY Change 0.0% 0.0%
Treasury Stock Shares 12.10M shares 12.10M shares
Shareholders Equity $89.43M $107.4M
YoY Change
Total Liabilities & Shareholders Equity $101.3M $119.2M
YoY Change -15.0% -13.05%

Cashflow Statement

Concept 2016 Q1 2015 Q1
OPERATING ACTIVITIES
Net Income -$6.932M -$3.885M
YoY Change 78.43% 1.22%
Depreciation, Depletion And Amortization $340.0K $680.0K
YoY Change -50.0% -26.88%
Cash From Operating Activities -$5.569M -$5.477M
YoY Change 1.68% -10.87%
INVESTING ACTIVITIES
Capital Expenditures $223.5K $314.4K
YoY Change -28.91% -29.25%
Acquisitions
YoY Change
Other Investing Activities $92.28K $8.250K
YoY Change 1018.5% -41.6%
Cash From Investing Activities $13.23M $3.280M
YoY Change 303.38% -24.85%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $0.00
YoY Change -100.0%
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -$1.500K $0.00
YoY Change -100.0%
NET CHANGE
Cash From Operating Activities -$5.569M -$5.477M
Cash From Investing Activities $13.23M $3.280M
Cash From Financing Activities -$1.500K $0.00
Net Change In Cash $7.660M -$2.197M
YoY Change -448.66% 12.64%
FREE CASH FLOW
Cash From Operating Activities -$5.569M -$5.477M
Capital Expenditures $223.5K $314.4K
Free Cash Flow -$5.793M -$5.792M
YoY Change 0.02% -12.11%

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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">BASIS OF PRESENTATION</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:8px;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"> The accompanying condensed consolidated financial statements as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;26, 2016</font><font style="font-family:inherit;font-size:10pt;"> include the accounts of Kopin Corporation, its wholly-owned subsidiaries, Kowon Technology Co., Ltd. (Kowon), a majority owned (</font><font style="font-family:inherit;font-size:10pt;">93%</font><font style="font-family:inherit;font-size:10pt;">)&#160;subsidiary located in Korea, and eMDT America Inc. (eMDT), a majority owned (</font><font style="font-family:inherit;font-size:10pt;">80%</font><font style="font-family:inherit;font-size:10pt;">) subsidiary located in the U.S.A. (collectively, the Company). In the fourth quarter of 2015, the Company increased its investment in Kopin Software Ltd. (KSL) (formerly Intoware Ltd.) from </font><font style="font-family:inherit;font-size:10pt;">58%</font><font style="font-family:inherit;font-size:10pt;"> to </font><font style="font-family:inherit;font-size:10pt;">100%</font><font style="font-family:inherit;font-size:10pt;">. Ownership interests of Kowon, KSL and eMDT not attributable to the Company are referred to as noncontrolling interests. All intercompany transactions and balances have been eliminated. The condensed consolidated financial statements for the </font><font style="font-family:inherit;font-size:10pt;">three</font><font style="font-family:inherit;font-size:10pt;"> months ended </font><font style="font-family:inherit;font-size:10pt;">March&#160;26, 2016</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">March&#160;28, 2015</font><font style="font-family:inherit;font-size:10pt;"> are unaudited and include all adjustments which, in the opinion of management, are necessary to present fairly the results of operations for the periods then ended. These condensed consolidated financial statements should be read in conjunction with the Company&#8217;s financial statements and notes thereto, included in the Company&#8217;s Annual Report on Form 10-K for the year ended </font><font style="font-family:inherit;font-size:10pt;">December&#160;26, 2015</font><font style="font-family:inherit;font-size:10pt;">. </font></div><div style="line-height:120%;padding-top:6px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company ceased its production activities at its Kowon facility in </font><font style="font-family:inherit;font-size:10pt;">2013</font><font style="font-family:inherit;font-size:10pt;"> and commenced offering the facility for sale. In </font><font style="font-family:inherit;font-size:10pt;">February 2016</font><font style="font-family:inherit;font-size:10pt;">, the Company entered into an agreement to sell the Kowon Facility for </font><font style="font-family:inherit;font-size:10pt;">9.5 billion</font><font style="font-family:inherit;font-size:10pt;"> KRW (approximately </font><font style="font-family:inherit;font-size:10pt;">$8.1 million</font><font style="font-family:inherit;font-size:10pt;"> as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;26, 2016</font><font style="font-family:inherit;font-size:10pt;">). Upon entering into the Purchase &amp; Sale agreement, (P&amp;S), the Company received a </font><font style="font-family:inherit;font-size:10pt;">10%</font><font style="font-family:inherit;font-size:10pt;"> deposit (approximately </font><font style="font-family:inherit;font-size:10pt;">$800,000</font><font style="font-family:inherit;font-size:10pt;"> as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;26, 2016</font><font style="font-family:inherit;font-size:10pt;">), which is included in "Other accrued liabilities" on our Condensed Consolidated Balance Sheets. The P&amp;S allows the buyer to cancel the transaction under certain conditions. </font></div><div style="line-height:120%;padding-top:6px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"> The Company believes the facility will be sold within the next </font><font style="font-family:inherit;font-size:10pt;">12</font><font style="font-family:inherit;font-size:10pt;"> months and has classified the facility assets as held for sale. </font></div><div style="line-height:120%;padding-top:6px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The results of the Company's operations for any interim period are not necessarily indicative of the results of the Company's operations for any other interim period or for a full fiscal year.</font></div><div style="line-height:120%;padding-top:6px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">During the </font><font style="font-family:inherit;font-size:10pt;">three months ended</font><font style="font-family:inherit;font-size:10pt;"> </font><font style="font-family:inherit;font-size:10pt;">March&#160;26, 2016</font><font style="font-family:inherit;font-size:10pt;">, the change in the Company's accumulated other comprehensive income was net of $</font><font style="font-family:inherit;font-size:10pt;">0.7 million</font><font style="font-family:inherit;font-size:10pt;"> foreign currency translation adjustments and </font><font style="font-family:inherit;font-size:10pt;">$0.3 million</font><font style="font-family:inherit;font-size:10pt;"> unrealized holding gains on marketable securities.</font></div></div>

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