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Spire Corporation Reports Results for Fourth-Quarter and Year-End 2013

Spire Corporation (“Spire” or the "Company") (OTCQB: SPIR), a global solar company providing capital equipment and turn-key manufacturing lines to produce photovoltaic (“PV”) modules and optoelectronics thin film services, announced today revenues from continuing operations for the year ended December 31, 2013 of $14.6 million, a 34% decrease from $22.1 million in 2012. Net loss for the year ended December 31, 2013 was $8.5 million, or $0.92 per diluted share, compared to a net loss of $1.9 million, or $0.22 per diluted share, for the same period of 2012.

These results include the completion of a transaction previously reported in which substantially all of the assets and assumption of certain liabilities related to Spire’s biomedical business were acquired by N2 Biomedical, LLC. As this transaction is being identified as giving rise to a variable interest entity and Spire is determined to be the primary beneficiary, the assets, liabilities and results of operations of N2 Biomedical, LLC are consolidated into the Company’s financial statements. In addition, the transaction gave rise to a deemed dividend in the amount of $9.5 million which is not reported as a gain for financial reporting purposes and is eliminated in consolidation. Fiscal 2012, net operating results reflect a gain on the sale of its semiconductor business unit of $3.5 million, net of a tax provision of $1.9 million or $0.34 per diluted share.

Spire’s revenues from continuing operations for the fourth-quarter ended December 31, 2013 were $3.6 million, a decrease of 5% from $3.8 million in the fourth-quarter of 2012. The decrease was primarily due to sales mix within the solar manufacturing business segment. Net loss for the quarter was $1.9 million, or $0.22 per diluted share, compared to net loss of $1.1 million, or $0.13 per diluted share, for the fourth-quarter of 2012. Spire recorded a net loss from continuing operations of $1.9 million in the fourth-quarter of 2013, compared to a net loss from continuing operations of $1.3 million in the fourth-quarter of 2012.

Gross margin from continuing operations for fiscal year 2013 was $2.5 million, or 17% of revenue, compared to $5.3 million, or 24% of revenue for fiscal year 2012, primarily due to the decline in sales, lower indirect costs offset by the amount of overhead absorbed due to the reduction in sales volume.

Net cash used in operating activities of continuing operations was $5.2 million for the year ended 2013, as compared to net cash used in operating activities of continuing operations of $6.1 million for the same period last year. At year-end 2013, Spire had unrestricted cash and cash equivalents of $4.0 million, as compared to $3.0 million at December 31, 2012.

Rodger W. LaFavre, President and CEO, stated, “While we are seeing improved PV market conditions, they were too late to translate into improved PV equipment sales for the fourth quarter of 2013.”

Mr. LaFavre, continued, “Current industry forecasts would indicate that strong demand will stimulate revenues for the industry’s manufacturers. We are already seeing increased equipment and turn-key line activities. Our focus on a sustained cost reduction program has resulted in measurable savings in operating expenses and is expected to continue through 2014. We are optimistic that the improving module manufacturing equipment business, combined with our cost reduction efforts will allow Spire to improve its operating performance in 2014.”

About Spire Corporation

Spire Corporation is a global solar company providing technology, equipment and turn-key production lines to manufacture photovoltaic modules and providing optoelectronics thin film services. For further details on the Company and its products, please visit www.spirecorp.com.

                 
Spire Corporation and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except share and per share amounts)
 
Three Months Ended Year Ended
December 31, December 31,
2013 2012 2013 2012

Net sales and revenues

$ 3,615   $ 3,787   $ 14,581   $ 22,110  

Operating loss from continuing operations

  (1,795 )   (1,189 )   (8,376 )   (6,603 )

Loss from continuing operations before income tax benefit

(1,884 ) (1,213 ) (8,523 ) (6,730 )

Income tax benefit (expense) – continuing operations

  5     (65 )   2     1,951  

Loss from continuing operations

(1,879 ) (1,278 ) (8,521 ) (4,779 )

Loss from discontinued operations before sale of business unit

-- -- -- (580 )

Gain on sale of business unit, net of transaction expenses

  --     160     --     3,501  

Net loss

  (1,879 )   (1,118 )   (8,521 )   (1,858 )

Less: Net income (loss) attributable to noncontrolling interest

  143     --     (44 )   --  

Net loss attributable to common stockholders

$ (2,022 ) $ (1,118 ) $ (8,477 ) $ (1,858 )

Basic and diluted income (loss) per share:

From continuing operations after income taxes $ (0.22 ) $ (0.15 ) $ (0.92 ) $ (0.56 )
From discontinued operations, net of tax   --     0.02     --     0.34  
Basic and diluted loss per share $ (0.22 ) $ (0.13 ) $ (0.92 ) $ (0.22 )

Weighted average number of common and common equivalent shares outstanding – basic and diluted

  9,207,874     8,627,850     9,176,438     8,579,027  
 
     

Summary of Condensed Consolidated Balance Sheet

 

December 31,

2013

Assets

Current assets $ 14,696
Net property and equipment 941
Other assets   432  
Total assets $ 16,609  

Liabilities and stockholders' deficit

Current liabilities $ 10,992
Total long-term liabilities 5,790
Stockholders’ deficit   (713 )
Total liabilities and stockholders’ deficit $ 16,609  
 

Certain matters described in this press release including those relating to Spire’s prospects for growth constitute forward-looking statements under the federal securities laws. The discussion of forward-looking information requires management of the Company to make certain estimates and assumptions regarding the Company’s strategic duration and the effect of such plans on the Company’s financial results. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the risk of dependence on market growth, competition and dependence on government agencies and other third parties for funding contract research and services, as well as other factors described in the Company's Form 10-K and other periodic reports filed with the Securities and Exchange Commission. Forward-looking statements contained in the press release speak only as of the date of this release. Subsequent events or circumstances occurring after such date may render these statements incomplete or out of date. The Company undertakes no obligation and expressly disclaims any duty to update such statements.

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