Welcome!

News Feed Item

Optex Systems Holdings, Inc. Releases Third Quarter 2013 Results

RICHARDSON, TX--(Marketwired - August 08, 2014) - Optex Systems Holdings, Inc. (OTCQB: OPXS), a leading manufacturer of optical sighting systems and assemblies primarily for Department of Defense applications, reported operating results for the three months and nine months ended June 29, 2014.

In the three months ended June 29, 2014, revenues decreased by ($2.5) million or (56.8%) from the respective prior period in 2013. The decrease in revenue is due to lower spending by the U.S. Government across all product lines as compared to prior year levels. The gross margin during the three months ended June 29, 2014 was $0.24 million or 12.6% of revenues as compared to a gross margin of $0.67 million or 15.2% for the three months ended June 30, 2013. The decrease in gross margin percentage for the period, as compared to the prior year period, is primarily due to reserves booked for excess slow moving inventory in the current quarter. During the three months ended June 29, 2014, we recorded a net loss applicable to common shareholders of ($0.41) million as compared to net loss applicable to common shareholders of ($0.08) million during the three months ended June 30, 2013. The increased loss of ($0.33) million is primarily to lower revenue and the associated gross margin of ($0.43) million offset with reduced general and administrative spending of $0.12 in the current year period as compared to the prior year.

In the nine months ended June 29, 2014, revenues decreased by ($4.6) million or (38.3%) from the respective prior period in 2013. The decrease is primarily attributable to lower revenue in plastic and glass periscopes due to reduced spending by the U.S. Government below prior year levels. The gross margin during the nine months ended June 29, 2014 was $1.2 million or 16.2% of revenues as compared to a gross margin of $2.0 million or 16.7% for the nine months ended June 30, 2013. The total gross margin declined due to decreased revenue and the gross margin percentage is slightly lower by 0.05% resulting from additional reserves booked for excess slow moving inventory in the current year. During the nine months ended June 29, 2014, we recorded a net loss applicable to common shareholders of ($0.55) million as compared to a net loss applicable to common shareholders of ($0.15) million during the nine months ended June 30, 2013. The increase in net loss of ($0.40) million is primarily attributable to lower revenue and the associated gross margin of ($0.8) million offset with the reduced general and administrative spending of $0.3 million and favorable changes in deferred income taxes and interest expenses of $0.1 million in the current year period as compared to the prior year.

Backlog, as of June 29, 2014, was $9.9 million as compared to a backlog of $15.0 million as of June 30, 2013, representing a decrease of $5.1 million or 34.0%. In the nine months ending June 29, 2014, Optex Systems Holdings received $5.1 million in new orders consisting of $2.8 million in plastic periscopes, $1.6 million in M36/DDAN sighting systems and $0.7 million in other product lines.

During the nine months ended June 29, 2014, the Company has experienced a net loss and a 38% decrease in revenues as compared to the nine months ended June 30, 2013. U.S. military spending has been significantly reduced as a result of the Congressional sequestration cuts to defense spending, which began in fiscal year 2013. As a result of lower U.S. government spending, we continue to explore other opportunities for manufacturing outside of our traditional product lines for products which could be manufactured using our existing lines in order to fully utilize our existing capacity. Given the sizable reduction in backlog from 2013 levels, we do not anticipate being able to fully offset the reduced government spending with alternative business in the current fiscal year or in the next twelve months.

The Company has historically funded its operations through operations, preferred stock offerings and bank debt. The Company's ability to generate positive cash flows depends on a variety of factors, including the continued development and successful marketing of the Company's products. At December 31, 2013, the Company had approximately $909 thousand in cash and access to a $1.0 million working line of credit. The Company expects to continue to incur net losses for at least the next year. Successful transition to attaining profitable operations is dependent upon achieving a level of revenue adequate to support the Company's cost structure. 

As of June 29, 2014, we had cash and cash equivalents of $0.9 million which is consistent with the period ended September 29, 2013. Net cash provided by operating activities during the period from September 30, 2013 to June 29, 2014 totaled $0.9 million. The outstanding line of credit balance as of September 29, 2013 was $0.9 million. In the first nine months of fiscal year 2014, Optex used the cash provided by operating activities to bring the ending outstanding line of credit balance to zero as of June 29, 2014. 

Management of the Company expects to be successful in maintaining sufficient working capital and will manage operations commensurate with its level of working capital through June 30, 2015. In the event the Company does not successfully implement its ultimate business plan, certain assets may not be recoverable. 

"Optex is now experiencing the full force of reduced U.S. defense spending," said Danny Schoening, Optex CEO. "During the last quarter, while the number of requests for quotes continued to grow, the size of and number of actual solicitation awards substantially declined," he commented. "We continue to reduce expenses, adjust staffing, purchasing and all controllable expenses as we remain steadfast in our commitment to responding rapidly and providing periscopes and sighting systems that represent quality and value at a fair price." 

Merrick Okamoto, Chairman of Optex, added, "During this downtrend in U.S. defense purchasing, I am proud of our efforts to expand our international business. The Company completed delivery and installation of our M17 Day / Thermal Driving Periscope to a South American country that has spurred additional interest from other foreign defense departments."

ABOUT OPTEX SYSTEMS

Optex, which was founded in 1987, is a Richardson, Texas based ISO 9001:2008 certified concern, which manufactures optical sighting systems and assemblies, primarily for Department of Defense (DOD) applications. Its products are installed on various types of U.S. military land vehicles, such as the Abrams and Bradley fighting vehicles, Light Armored and Armored Security Vehicles, and have been selected for installation on the Stryker family of vehicles. Optex also manufactures and delivers numerous periscope configurations, rifle and surveillance sights and night vision optical assemblies. Optex delivers its products both directly to the military services and to prime contractors. For additional information, please visit the Company's website at www.optexsys.com.

Safe Harbor Statement

This press release and other written reports and oral statements made from time to time by the Company may contain so-called "forward-looking statements," all of which are subject to risks and uncertainties. You can identify these forward-looking statements by their use of words such as "expects," "plans," "will," "estimates," "forecasts," "projects" and other words of similar meaning. You can identify them by the fact that they do not relate strictly to historical or current facts. These statements are likely to address the Company's growth strategy, financial results and product and development programs. You must carefully consider any such statement and should understand that many factors could cause actual results to differ from the Company's forward-looking statements. These factors include inaccurate assumptions and a broad variety of other risks and uncertainties, including some that are known and some that are not. No forward-looking statement can be guaranteed and actual future results may vary materially.

The Company does not assume the obligation to update any forward-looking statement. You should carefully evaluate such statements in light of factors described in the Company's filings with the SEC, especially on Forms 10-K, 10-Q and 8-K. In various filings the Company has identified important factors that could cause actual results to differ from expected or historic results. You should understand that it is not possible to predict or identify all such factors. Consequently, you should not consider any such list to be a complete list of all potential risks or uncertainties.

                                                                            
                                                                            
                        Optex Systems Holdings, Inc.                        
                   Condensed Consolidated Balance Sheets                    
                                                                            
                                           (Thousands, except share data)   
                                           June 29, 2014     September 30,  
                                            (Unaudited)          2013       
                                         ----------------  ---------------- 
                                                                            
                 ASSETS                                                     
                                                                            
Current Assets                                                              
Cash                                     $            909  $            882 
Accounts Receivable                                   948             3,118 
Net Inventory                                       6,939             7,579 
Prepaid Expenses                                       42                36 
                                         ----------------  ---------------- 
                                                                            
Total Current Assets                                8,838            11,615 
                                                                            
Property and Equipment                                                      
Property Plant and Equipment                        1,738             1,704 
Accumulated Depreciation                           (1,518)           (1,460)
                                         ----------------  ---------------- 
                                                                            
Total Property and Equipment                          220               244 
                                                                            
Other Assets                                                                
Deferred Tax Asset - Long Term                      1,154             1,077 
Prepaid Royalties - Long Term                         158               180 
Security Deposits                                      27                21 
                                         ----------------  ---------------- 
                                                                            
Total Other Assets                                  1,339             1,278 
                                         ----------------  ---------------- 
                                                                            
  Total Assets                           $         10,397  $         13,137 
                                         ================  ================ 
                                                                            
  LIABILITIES AND STOCKHOLDERS' EQUITY                                      
                                                                            
Current Liabilities                                                         
Accounts Payable                         $            282  $            989 
Accrued Expenses                                      488               706 
Accrued Warranties                                     25                25 
Customer Advance Deposits - Short Term                991               769 
Credit Facility                                         -               858 
                                         ----------------  ---------------- 
Total Current Liabilities                           1,786             3,347 
                                         ----------------  ---------------- 
                                                                            
Other Liabilities                                                           
Customer Advance Deposits - Long Term               1,234             1,935 
                                         ----------------  ---------------- 
                                                                            
Total Other Liabilities                             1,234             1,935 
                                         ----------------  ---------------- 
                                                                            
Total Liabilities                                   3,020             5,282 
                                                                            
Stockholders' Equity                                                        
Optex Systems Holdings, Inc. Preferred                                      
 Stock ($0.001 par 5,000 authorized,                                        
 1,001 and 1, 016 series A preferred                                        
 shares issued and outstanding,                                             
 respectively)                                          -                 - 
Optex Systems Holdings, Inc. - (par                                         
 $0.001, 2,000,000,000 authorized,                                          
 170,913,943 and 157,346,607 shares                                         
 issued and outstanding, respectively)                171               157 
Additional Paid-in-capital                         17,984            17,922 
Retained Earnings (Deficit)                       (10,778)          (10,224)
                                         ----------------  ---------------- 
                                                                            
Total Stockholders' Equity                          7,377             7,855 
                                         ----------------  ---------------- 
                                                                            
Total Liabilities and Stockholders'                                         
 Equity                                  $         10,397  $         13,137 
                                         ================  ================ 
                                                                            
                                                                            
                                                                            
                        Optex Systems Holdings, Inc.                        
              Condensed Consolidated Statements of Operations               
                                (Unaudited)                                 
                                                                            
                              (Thousands, except common share data)         
                                                                            
                         Three months ended           Nine months ended     
                       June 29,      June 30,      June 29,      June 30,   
                         2014          2013          2014          2013     
                     ------------  ------------  ------------  ------------ 
                                                                            
Revenues             $      1,858  $      4,358  $      7,394  $     11,978 
                                                                            
Total Cost of Sales         1,615         3,688         6,170         9,955 
                     ------------  ------------  ------------  ------------ 
                                                                            
Gross Margin         $        243  $        670  $      1,224  $      2,023 
                                                                            
General and                                                                 
 Administrative               648           766         1,853         2,208 
                     ------------  ------------  ------------  ------------ 
                                                                            
Operating Loss       $       (405) $        (96) $       (629) $       (185)
                                                                            
Other Expenses                                                              
                                                                            
Interest Expense -                                                          
 Net                           (6)           22             2            28 
                     ------------  ------------  ------------  ------------ 
Total Other          $         (6) $         22  $          2  $         28 
                                                                            
Loss Before Taxes    $       (399) $       (118) $       (631) $       (213)
                                                                            
Deferred Income                                                             
 Taxes (Benefit)                -           (39)          (77)          (68)
                     ------------  ------------  ------------  ------------ 
                                                                            
Net Loss After Taxes $       (399) $        (79) $       (554) $       (145)
                     ============  ============  ============  ============ 
                                                                            
Net Loss Applicable                                                         
 to Common                                                                  
 Shareholders        $       (399) $        (79) $       (554) $       (145)
                                                                            
                     ------------  ------------  ------------  ------------ 
Basic and Diluted                                                           
 Loss per Share      $     (0.002) $     (0.001) $     (0.003) $     (0.001)
                     ============  ============  ============  ============ 
                                                                            
Weighted Average                                                            
 Common Shares                                                              
 Outstanding          170,913,943   157,346,607   162,949,533   154,216,977 
                                                                            

CONTACT:
Optex Systems Holdings, Inc.
Stanley A. Hirschman
President
(972) 764-5700
[email protected]
1420 Presidential Drive
Richardson, TX 75081

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
As you move to the cloud, your network should be efficient, secure, and easy to manage. An enterprise adopting a hybrid or public cloud needs systems and tools that provide: Agility: ability to deliver applications and services faster, even in complex hybrid environments Easier manageability: enable reliable connectivity with complete oversight as the data center network evolves Greater efficiency: eliminate wasted effort while reducing errors and optimize asset utilization Security: imple...
Mobile device usage has increased exponentially during the past several years, as consumers rely on handhelds for everything from news and weather to banking and purchases. What can we expect in the next few years? The way in which we interact with our devices will fundamentally change, as businesses leverage Artificial Intelligence. We already see this taking shape as businesses leverage AI for cost savings and customer responsiveness. This trend will continue, as AI is used for more sophistica...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, led attendees through the exciting evolution of the cloud. He looked at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering m...
Digital transformation is about embracing digital technologies into a company's culture to better connect with its customers, automate processes, create better tools, enter new markets, etc. Such a transformation requires continuous orchestration across teams and an environment based on open collaboration and daily experiments. In his session at 21st Cloud Expo, Alex Casalboni, Technical (Cloud) Evangelist at Cloud Academy, explored and discussed the most urgent unsolved challenges to achieve f...
In his session at 21st Cloud Expo, Raju Shreewastava, founder of Big Data Trunk, provided a fun and simple way to introduce Machine Leaning to anyone and everyone. He solved a machine learning problem and demonstrated an easy way to be able to do machine learning without even coding. Raju Shreewastava is the founder of Big Data Trunk (www.BigDataTrunk.com), a Big Data Training and consulting firm with offices in the United States. He previously led the data warehouse/business intelligence and B...
Recently, REAN Cloud built a digital concierge for a North Carolina hospital that had observed that most patient call button questions were repetitive. In addition, the paper-based process used to measure patient health metrics was laborious, not in real-time and sometimes error-prone. In their session at 21st Cloud Expo, Sean Finnerty, Executive Director, Practice Lead, Health Care & Life Science at REAN Cloud, and Dr. S.P.T. Krishnan, Principal Architect at REAN Cloud, discussed how they built...
The past few years have brought a sea change in the way applications are architected, developed, and consumed—increasing both the complexity of testing and the business impact of software failures. How can software testing professionals keep pace with modern application delivery, given the trends that impact both architectures (cloud, microservices, and APIs) and processes (DevOps, agile, and continuous delivery)? This is where continuous testing comes in. D
The “Digital Era” is forcing us to engage with new methods to build, operate and maintain applications. This transformation also implies an evolution to more and more intelligent applications to better engage with the customers, while creating significant market differentiators. In both cases, the cloud has become a key enabler to embrace this digital revolution. So, moving to the cloud is no longer the question; the new questions are HOW and WHEN. To make this equation even more complex, most ...
Blockchain is a shared, secure record of exchange that establishes trust, accountability and transparency across business networks. Supported by the Linux Foundation's open source, open-standards based Hyperledger Project, Blockchain has the potential to improve regulatory compliance, reduce cost as well as advance trade. Are you curious about how Blockchain is built for business? In her session at 21st Cloud Expo, René Bostic, Technical VP of the IBM Cloud Unit in North America, discussed the b...
SYS-CON Events announced today that Synametrics Technologies will exhibit at SYS-CON's 22nd International Cloud Expo®, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. Synametrics Technologies is a privately held company based in Plainsboro, New Jersey that has been providing solutions for the developer community since 1997. Based on the success of its initial product offerings such as WinSQL, Xeams, SynaMan and Syncrify, Synametrics continues to create and hone in...
With tough new regulations coming to Europe on data privacy in May 2018, Calligo will explain why in reality the effect is global and transforms how you consider critical data. EU GDPR fundamentally rewrites the rules for cloud, Big Data and IoT. In his session at 21st Cloud Expo, Adam Ryan, Vice President and General Manager EMEA at Calligo, examined the regulations and provided insight on how it affects technology, challenges the established rules and will usher in new levels of diligence arou...
Nordstrom is transforming the way that they do business and the cloud is the key to enabling speed and hyper personalized customer experiences. In his session at 21st Cloud Expo, Ken Schow, VP of Engineering at Nordstrom, discussed some of the key learnings and common pitfalls of large enterprises moving to the cloud. This includes strategies around choosing a cloud provider(s), architecture, and lessons learned. In addition, he covered some of the best practices for structured team migration an...
The 22nd International Cloud Expo | 1st DXWorld Expo has announced that its Call for Papers is open. Cloud Expo | DXWorld Expo, to be held June 5-7, 2018, at the Javits Center in New York, NY, brings together Cloud Computing, Digital Transformation, Big Data, Internet of Things, DevOps, Machine Learning and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding busin...
No hype cycles or predictions of a gazillion things here. IoT is here. You get it. You know your business and have great ideas for a business transformation strategy. What comes next? Time to make it happen. In his session at @ThingsExpo, Jay Mason, an Associate Partner of Analytics, IoT & Cybersecurity at M&S Consulting, presented a step-by-step plan to develop your technology implementation strategy. He also discussed the evaluation of communication standards and IoT messaging protocols, data...
Companies are harnessing data in ways we once associated with science fiction. Analysts have access to a plethora of visualization and reporting tools, but considering the vast amount of data businesses collect and limitations of CPUs, end users are forced to design their structures and systems with limitations. Until now. As the cloud toolkit to analyze data has evolved, GPUs have stepped in to massively parallel SQL, visualization and machine learning.