Q3 2024 Laser Photonics Corp Earnings Call
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Mind you. This conference is being recorded it is now my pleasure to introduce Brian Siegel with Hayden Investor Relations. Please go ahead.
Brian Siegel: Thank you operator with me today are ways of poor laser photonics CEO Carlos readiness, the company's VP of finance any forward looking statements made during this conference call, whether general or specific in nature are subject to risks and uncertainties that may cause actual results to differ materially from those that the company anticipates. These risks and uncertainties include.
Brian Siegel: But are not limited to specific risks and uncertainties discussed in the reports the company periodically files with the SEC.
Brian Siegel: Laser photonics assumes no obligation to either update any forward looking statements that is made or may make or to update the factors that may cause actual results to differ materially from those they forecast I will now turn the call over to Wayne laser Photonics, Chief Executive Officer.
Wayne Laser: Good morning, everyone and thank you for joining us today to review laser Photonics third quarter results Frank.
Wayne Laser: I'll get into the third quarter I'm excited to share details about our recent acquisition of Controle Microsystems.
Wayne Laser: EMS, which was finalized shortly after the close of the quarter.
Wayne Laser: We used a portion of the $3 million in funds. We raised in August to make this acquisition, which represents a transformative opportunity for an LPC by expanding our footprint into the healthcare and pharmaceutical industries, particularly in controlled release drug delivery and chronic proofing pills, while also providing a chrome.
Wayne Laser: Mental synergies and industry markets.
Wayne Laser: CMS specializing in custom precision laser systems their key products for life Sciences are laser drilling systems that create microscopic apertures and tablets for controlled release drug delivery and systems that mark pills to prevent counterfeiting.
Also make customs laser solutions for industrial and other markets, which we believe present some interesting opportunities that were previously not exploited.
Wayne Laser: These capabilities aligned well with Lpc's fusion of innovating solutions that impact critical industries.
Wayne Laser: The pharmaceutical market and especially in the drug delivery technologies is expected to grow at nearly 11% annually through 2030.
Wayne Laser: This acquisition Diversifies LPC into a high growth recession resistant sector, given us a buffer against economic cyclicality.
Wayne Laser: And providing stability to our clean tech revenue stream as we work to expand penetration rates for this technology.
Wayne Laser: CMS already serves several of the world's largest pharmaceutical companies, providing a platform for us to deepen relationships with major industry players and.
Wayne Laser: And expand our client base in this sector.
Speaker Change: Due to Underinvestment from his previous order, we believe CMS products were not fully monetize in both the pharma and custom laser side.
Speaker Change: Rpc's robust sales and marketing infrastructure.
Speaker Change: We see significant potential to unlock value CMS also brings over $2 million in unbilled contracted revenue, which we can convert to immediate cash flow. This in next quarter.
Speaker Change: Additionally, we retained most of the CMS engineering and support staff, adding their expertise towards teams.
Speaker Change: Our immediate focus will be on integrating the CMS team and products into the Lpc's operations, while driving forward with our ongoing initiatives.
We remain committed to innovating in our core industrial laser markets, particularly in surface treatment anti drone systems and.
Speaker Change: Expanding our reach globally.
Speaker Change: In summary, the CMS acquisition aligns with Ltc's growth strategy, diversifying our portfolio and setting the foundation for scalability and sustained revenue growth in new verticals now I'll review our results.
This quarter, we navigated a challenging period with the decrease in sales and increased cost driven by our strategic investments and expanding human resource sales and administrative functions.
Speaker Change: These decisions while impacting our short term performance are integral to supporting our future growth and setting the stage for long term success.
Speaker Change: Thomas Corp, steadfast in our submission to establish itself as a leader in laser technology solutions for industrial applications.
Speaker Change: Even considering recent temporary financial setbacks.
Our commitment to investing in groundbreaking technologies aligns with our vision of expansion positioning us to leverage emergency opportunities enhance operational efficiency moving forward.
Speaker Change: <unk> acquisition of CMS, along with its intellectual property and patents related to software and optical mechanical capabilities.
Speaker Change: Positions related products Corp to advance the development of class one products.
Speaker Change: Robotics self.
Speaker Change: These developments will pave the way for future innovation stemming from this foundational research.
Speaker Change: In the spirit of innovation, we have made significant strides in the research and development of our advanced products, including the <unk> production system and our both the shape <unk> metal additive manufacturing technology with.
Speaker Change: With higher precision and efficiency the systems will be essential in meeting growing demands in both the defense and industrial markets. We look forward to bringing more information on these technologies and future investor updates. Additionally, our focus during the quarter has been an events.
Speaker Change: Two pivotal product concepts, the laser shield anti drone system LCD and the Nextgen cleantech robotic cell LCD represents our proactive approach to addressing security challenges, while the two type of a buy sell reflects our commitment to innovation and automated manufacturing solutions together.
Speaker Change: These initiatives not only highlight our dedication to advancing these technology.
Speaker Change: Also to reinforce our strategy of continuous development as we work towards commercialization by nurturing. These technologies through rigorous research and development Leesville. Thomas Corp is well positioned to capitalize on future laser solutions in a rapidly evolving market, although sales were down for the quarter we closed.
Speaker Change: Several key deals that are strategically significant for LPC these growth and marketing position.
Speaker Change: Secured a sale of our <unk> Tec industrial roughly <unk> $30 50.
Speaker Change: <unk> 352 accurate a global leader in non destructive testing or MDT services.
Speaker Change: This sale marks the beginning of a promising relationship with accurate, which is exploring lpc's laser technology to enhance their asset protection.
Speaker Change: Across industries, including chemical power generation and aerospace.
Speaker Change: Our partnership positions <unk> as a preferred provider for accurate ongoing purchasing program.
Speaker Change: As to expand our footprint in the MDT market.
Speaker Change: We also achieved the sale to the U S. Navy at Pearl Harbor further establishing <unk> footprint in the defense sector to sell underscores the reliability and performance of our laser system and demanding environments.
Speaker Change: The Navy's decision to use our cleantech laser technology aligns with their need for safe efficient and environmentally compliant maintenance solutions for their fleet.
Speaker Change: Meet increasingly echoed across other military branches.
Speaker Change: We expect our existing partnership with Brock now, bringing our laser powerful robotic and handheld systems to the Asia Pacific region.
Speaker Change: By joining forces with Brock, Australia, <unk> advanced laser technologies will now serve industries such as mining.
Construction and defense across Australia, and New Zealand markets.
Speaker Change: This partnership uniquely addresses operational challenges and hazardous environments by pairing Lpc's laser system with <unk> remote control robotic solutions, enhancing both safety and productivity for operators in the field.
Speaker Change: We also had a significant sale in the renewable energy technology market, where our cleantech product will be used to enhance the manufacturing process for hyper pure policy silicon solar cells.
Speaker Change: Each of these sales highlight how LPC is cultivating relationships that position us for sustained growth at strategic verticals, including defense non destructive testing and heavy industrial applications. These customers and partnerships provide a foundation for future sales upsell opportunities and expansion.
Speaker Change: And to markets.
Speaker Change: Thank you to our shareholders and employees for their unwavering support and dedication.
Speaker Change: We look forward to delivering on our strategic initiatives and building on our recent achievements to drive long term value.
Speaker Change: I will now turn it over to Carlos to review our financials.
Carlos Readiness: Thank you Wayne revenue was down 22% from last year at $800000.
Carlos Readiness: Although it is opex sequentially by 21% from the second quarter Encouragingly, our mix continues to be dominated by clean tech leading to a 1140 basis point improvement in gross margin to 85, 8% operating expenses increased by 25% due to our investment and resources to manage.
Our anticipated growth, including the addition of HR sales and administrative personnel.
Carlos Readiness: The combination of these items led to higher operating losses of $1 4 million and a net loss of $1 $6 million loss per share expanded to 13 cents from previous <unk> 11 per share.
Carlos Readiness: While our share count increased to $13 3 million from $8 3 million due to the acquisition of licenses from phone on and our August capital raise which netted a total of $2 6 million as we look forward. We are excited to combine CMS and LPC.
Carlos Readiness: <unk> brings with it over $2 million in existing orders, which we expect to ship over the next few months.
Carlos Readiness: And they continue to add new orders to their backlog for 2025 as well. We are also optimistic that momentum for clean Tech will pick up over the next few quarters as we continue to grow our pipeline and convert a portion of it to orders with that operator, we can close out the call.
Speaker Change: Thank you. This concludes today's teleconference. We thank you for your participation you may disconnect your lines at this time.
Speaker Change: Okay.