Microvision Announces Third Quarter 2007 Results
Company Progresses on Key Strategic Milestones, Reduces Quarterly Cash Burn by 17%
REDMOND, Wash.--(BUSINESS WIRE)--
Microvision, Inc. (NASDAQ:MVIS), a global leader in light scanning technologies, today reported operating and financial results for the third quarter and first nine months of 2007.
"Our operating results for the third quarter and first nine months of the year include reaching several important business, development and financial milestones that we believe will move us closer to commercialization of high volume consumer and automotive products based on Microvision's proprietary projection display PicoP(TM) technology," said Alexander Tokman, President and CEO of Microvision.
"The latest contract with a world leading Asian consumer electronics manufacturer is another example of progress on our strategy to bring PicoP enabled solutions to market. This agreement should allow us to leverage the extensive integration and manufacturing capabilities of one of the world's largest suppliers of mobile phones, digital cameras, and personal media players."
Operating Results
-- PicoP for Mobile Projection Applications. PicoP(TM) is an
ultra miniature projection module being designed to produce
full color, high-resolution images and be small and low power
enough to be embedded directly into a mobile device.
-- Announced an agreement with Motorola to develop pico
projector display solutions for mobile applications using
Microvision's PicoP display technology. The companies are
initially working together to integrate the PicoP
projector inside a functioning mobile device for
demonstration purposes.
-- Signed an agreement with an Asian Consumer Electronics
Manufacturer to integrate Microvision's PicoP display
engine into fully functional stand-alone projector
prototypes. The prototypes are expected to be marketed to
leading consumer electronics companies for private
labeling and distribution for mobile applications.
-- PicoP for Automotive Applications. Subsequent to the end of
the quarter, delivered the first advanced PicoP based
projection module for an Automotive Head-Up Display (HUD) to
Visteon, a Tier 1 automotive supply partner of Microvision.
Visteon plans to use the advanced HUD prototype samples to
demonstrate the unique performance characteristics of
Microvision's platform technology in order to secure
automotive OEM customers.
-- PicoP for Eyewear Applications. Delivered a demonstrator unit
of an innovative eyewear optical system to the U.S. Air Force
under the contract awarded by the United States Air Force
Research Laboratory in 2006. This initial eyewear optical
system is expected to serve as the foundation for a new
generation of see-through, full color eyewear display products
from Microvision.
-- ROV(TM) Laser Bar Code Scanner. Subsequent to the end of third
quarter, began commercial shipments of the ROV scanner. ROV,
with its rich feature set, wide array of accessories, and
powerful software, has been designed for a variety of mobility
applications to address both simple business environments, and
more demanding mobility environments such as construction,
field services, transportation, professional services,
hospitality, government, retail, manufacturing, and
healthcare.
-- Funding. Completed the call of the company's publicly traded
warrants -- raising $34.1 million to fund operations without
an increase in the fully diluted common shares outstanding.
-- Industry Awards. Received 2007 North American Frost & Sullivan
Award for Technology Innovation for business and design
advancements of a bi-directional MEMS scanning mirror, a key
component of the company's PicoP display engine.
"In addition to the accomplishments listed above, we continued to mature the PicoP technology and strengthen the supply chain for PicoP components while lowering the cash burn from operating activities by 17% to $5.1 million for the quarter. We also added key business development and strategic sourcing resources to increase the capacity and depth of both functions. The entire Microvision team remains focused on achieving the milestones we have communicated to our customers, partners, and shareholders," concluded Tokman.
Financial Results
For the nine months ended September 30, 2007, the company reported revenue of $7.5 million compared to $5.2 million for the same period in 2006 and $2.6 million for the three months ended September 30, 2007 compared to $823,000 for the same period in 2006. As of September 30, 2007, the backlog totaled $5.7 million compared to $6.9 million at September 30, 2006.
The company reported an operating loss for the nine months ended September 30, 2007 of $18.8 million compared to $21.1 million for the same period in 2006 and $6.5 million for the three months ended September 30, 2007 compared to $6.7 million for the same period in 2006.
The company reported a net loss available to common shareholders of $13.8 million for the nine months ended September 30, 2007 compared to $18.6 million for the same period in 2006 and $4.7 million for the three months ended September 30, 2007 compared to $7.7 million for the same period in 2006. The net loss per share was $0.29 for the nine months ended September 30, 2007 compared to $0.60 for the same period in 2006 and $0.08 for the three months ended September 30, 2007 compared to $0.20 for the same period in 2006.
Net cash used in operating activities was $5.1 million for the three months ended September 30, 2007 compared to $6.1 million for the same period in 2006. The company ended the quarter with $40.4 million in cash, cash equivalents and investment securities.
Conference Call
Microvision will host a conference call to discuss its third quarter 2007 financial and operating results at 4:30 p.m. ET on November 1, 2007. Participants may join the conference call by dialing 866-203-3206 (for U.S. participants) or 617-213-8848 (for International participants) ten minutes prior to the start of the conference. The conference pass-code number is 68375632. Additionally, the call will be broadcast over the Internet and can be accessed from the Company's web site at www.microvision.com. The web cast and information needed to access the telephone replay will be available through the same link following the conference call.
About Microvision: www.microvision.com
Microvision provides a display technology platform designed to enable next generation display and imaging products for pico projectors, vehicles displays, and wearable displays that interface to mobile devices. The company also manufactures and sells its bar code scanner product line which features the company's proprietary MEMS technology.
Forward-Looking Statements Disclaimer
Certain statements contained in this release, including those relating to commercialization and future products, future product form factor, product applications, as well as statements containing words like "could," "should," "believe," "expects" and other similar expressions, are forward-looking statements that involve a number of risks and uncertainties. Factors that could cause actual results to differ materially from those projected in the Company's forward-looking statements include the following: our ability to raise additional capital when needed; our financial and technical resources relative to those of our competitors; our ability to keep up with rapid technological change; our dependence on the defense industry and a limited number of government development contracts; government regulation of our technologies; our ability to enforce our intellectual property rights and protect our proprietary technologies; the ability to obtain additional contract awards; the timing of commercial product launches and delays in product development; the ability to achieve key technical milestones in key products; dependence on third parties to develop, manufacture, sell and market our products; potential product liability claims and other risk factors identified from time to time in the Company's SEC reports, including the Company's Annual Report on Form 10-K filed with the SEC. Except as expressly required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changes in circumstances or any other reason.
Microvision, Inc.
Balance Sheet
(In thousands)
(Unaudited)
September 30, December 31,
2007 2006
------------- ------------
Assets
Current Assets
Cash and cash equivalents $ 18,484 $ 14,552
Investment securities, available-for-
sale 21,940 -
Accounts receivable, net of allowances 842 1,166
Costs and estimated earnings in excess
of billings on uncompleted contracts 1,261 565
Inventory 1,024 1,043
Current restricted investments in
Lumera - 10,693
Other current assets 1,362 1,986
------------- ------------
Total current assets 44,913 30,005
Property and equipment, net 4,124 4,011
Restricted investments 1,329 1,268
Other assets 49 41
------------- ------------
Total assets $ 50,415 $ 35,325
============= ============
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable $ 1,914 $ 1,785
Accrued liabilities 3,063 3,698
Billings in excess of costs and
estimated earnings on uncompleted
contracts 309 200
Liability associated with common stock
warrants 4,065 2,572
Liability associated with embedded
derivative feature - 68
Current portion of notes payable - 2,418
Current portion of capital lease
obligations 45 45
Current portion of long-term debt 63 59
------------- ------------
Total current liabilities 9,459 10,845
Capital lease obligations, net of current
portion 98 132
Long-term debt, net of current portion 409 457
Deferred rent, net of current portion 1,799 2,027
------------- ------------
Total liabilities 11,765 13,461
------------- ------------
Commitments and contingencies
Shareholders' Equity
Common stock at par value 57 43
Additional paid-in capital 291,713 253,086
Receivables from related parties, net - (250)
Accumulated other comprehensive income 279 8,619
Accumulated deficit (253,399) (239,634)
------------- ------------
Total shareholders' equity 38,650 21,864
------------- ------------
Total liabilities and shareholders' equity $ 50,415 $ 35,325
============= ============
Microvision, Inc.
Statement of Operations
(In thousands, except earnings per share data)
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
--------------------------------------
2007 2006 2007 2006
--------- -------- --------- ---------
Contract revenue $ 2,301 $ 541 $ 6,422 $ 3,657
Product revenue 298 282 1,074 1,544
--------- -------- --------- ---------
Total revenue 2,599 823 7,496 5,201
--------- -------- --------- ---------
Cost of contract revenue 1,349 343 3,576 2,493
Cost of product revenue 404 675 1,134 3,650
--------- -------- --------- ---------
Total cost of revenue 1,753 1,018 4,710 6,143
--------- -------- --------- ---------
Gross margin 846 (195) 2,786 (942)
--------- -------- --------- ---------
Research and development
expense 3,694 2,855 10,247 7,316
Sales, marketing, general and
administrative expense 3,691 3,652 11,328 13,066
Gain on disposal of fixed
assets - - - (198)
--------- -------- --------- ---------
Total operating expenses 7,385 6,507 21,575 20,184
--------- -------- --------- ---------
Loss from operations (6,539) (6,702) (18,789) (21,126)
Interest income 526 236 860 484
Interest expense (14) (1,346) (499) (4,804)
Gain (loss) on derivative
instruments, net 883 125 (1,709) 3,179
Other expense (8) (5) (25) (16)
--------- -------- --------- ---------
Net loss before Lumera
transactions (5,152) (7,692) (20,162) (22,283)
Equity in losses of Lumera - - - (290)
Gain on sale of investment in
Lumera 434 - 6,397 7,270
--------- -------- --------- ---------
Net loss (4,718) (7,692) (13,765) (15,303)
Stated dividend on mandatorily
redeemable convertible
preferred stock - - - (59)
Accretion to par value of
preferred stock - - - (138)
Inducement for conversion of
preferred stock - - - (3,076)
--------- -------- --------- ---------
Net loss available for common
shareholders $ (4,718) $(7,692) $(13,765) $(18,576)
========= ======== ========= =========
Net loss per share - basic and
diluted $ (0.08) $ (0.20) $ (0.29) $ (0.60)
========= ======== ========= =========
Weighted-average shares
outstanding - basic and
diluted 56,236 38,437 47,683 30,997
========= ======== ========= =========
Source: Microvision, Inc.
Released November 1, 2007