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05 Sep 2013
Tim Losik, new CEO of the refinanced firm, sees an encouraging outlook.
ProPhotonix, the US-headquartered diode laser and LED module supplier with operations in the UK and Ireland, has reported an increase in sales and order activity in the first half of 2013 – but is still battling to turn a profit.
For the six months that ended June 30, the company – hit hard by the downturn in the solar sector last year – posted sales of $7.4 million, up 9% on the same period in 2012.
Despite a much-improved gross margin on those sales, an increase in operating expenses dragged ProPhotonix to a net loss of $1.5 million, down from $1.8 million in the first of last year.
Tim Losik, who became the company’s new CEO when he took over from long-time chief Mark Blodgett earlier this summer, said:
“During the first half 2013, the company has experienced an improvement in business activity with order bookings through the first six months of 2013 totaling $8.4 million.”
Backlog grows
As of June 2013, the backlog of unshipped orders stood at $6.2 million, up 16% on the figure at the end of 2012 – and equivalent to a book-to-bill ratio of 1.15.
“New customer activity is a cornerstone focus for growth and I am pleased that we are embracing new customers every day,” Losik said. “Ten new customers accounted for $1.8 million of bookings in the first half, in both businesses, across several market sectors: industrial, medical/dental, semiconductor, and robotics.”
Losik hailed the recent investment in the ProPhotonix sales force as the key reason behind the bookings rebound, although that has obviously resulted in higher operational costs. “We are seeing broad interest in the green and blue direct diode lasers by Osram and believe this will allow growth within the existing customer base and new customer activity,” the CEO added, referring to a new distribution deal signed in May.
June refinancing
Crucial to the company’s ongoing activity was a new $3 million loan agreed in June. “We are confident this capital puts ProPhotonix on solid footing to continue the execution of its strategy,” Losik said. “As we execute our strategy and grow, we will seek additional sources of capital in order to expand our product and market positioning and to reduce our cost structure.”
He added that cost-cuts made in the first half of the year will significantly reduce the firm’s break-even point. With a cash balance of only $0.7 million on June 30, reaching break even looks to be a matter of some urgency, with Losik saying:
“Following the financing on June 21, 2013, and having assessed future trading forecasts, the company believes that it has sufficient financing to allow it to trade for the foreseeable future.”
He concluded on a positive note, saying: “The outlook for ProPhotonix is very encouraging and despite global economic head winds, to which we are not immune, order activity has improved in the first half 2013, while our opportunity pipeline continues to grow.”
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