Current report Kopin Corp

8-K - Current report

Published: 2017-08-08 07:30:13
Submitted: 2017-08-08
Period Ending In: 2017-08-08
a51665768.htm KOPIN CORPORATION 8-K



UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 8-K



CURRENT REPORT


Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported) August 8, 2017


KOPIN CORPORATION

(Exact Name of Registrant as Specified in Charter)



DELAWARE

000-19882

04-2833935

(State or Other Jurisdiction

of Incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

125 North Drive, Westborough, MA 01581

(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code (508) 870-5959


(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
(see General Instruction A.2 below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Item 2.02. Results of Operations and Financial Condition.

Kopin Corporation issued a press release on August 8, 2017, a copy of which is attached as Exhibit 99.1 to this report and incorporated herein by this reference, in which the Company announced financial results for the second quarter ended July 1, 2017. This information in this Item 2.02 (including Exhibit 99.1) shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

(d)

Exhibits.

 

99.1

Press Release dated August 8, 2017, entitled, “KOPIN PROVIDES BUSINESS UPDATE AND SECOND QUARTER 2017 OPERATING RESULTS”.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

KOPIN CORPORATION

 
 
Date:

August 8, 2017

By:

/s/ Richard A. Sneider

Richard A. Sneider

Treasurer and Chief Financial Officer

(Principal Financial and Accounting Officer)



EXHIBIT INDEX

Exhibit   Description
99.1

Press Release dated August 8, 2017, entitled, “KOPIN PROVIDES BUSINESS UPDATE AND SECOND QUARTER 2017 OPERATING RESULTS”.

a51665768ex99_1.htm EXHIBIT 99.1


Exhibit 99.1

Kopin Provides Business Update and Second
Quarter 2017 Operating Results

  • 2Q Revenues of $5.9M, 36% higher than 2Q 2016
  • Expect 70% Revenue Growth in Second Half of 2017
  • Five New Headsets with Key Kopin Components to be Introduced in 2H 2017
  • All Four Military Programs Ramping
  • Revenue Growth Momentum Accelerating

WESTBOROUGH, Mass.--(BUSINESS WIRE)--August 8, 2017--Kopin Corporation (NASDAQ: KOPN), a leading developer of innovative wearable computing technologies and solutions, today provided an update on its business initiatives and reported financial results for the second quarter of 2017, ended July 1, 2017.

“We made very good progress in many areas in the second quarter, and we are actively working with multiple tier-one customers,” said Dr. John CC Fan, CEO of Kopin. “We believe the commercial AR/VR opportunities are beginning to materialize. We have experienced very strong interest for our 2k x 2k LightningTM OLED displays and related optics, and we have made great progress in production readiness of our Lightning OLED displays with our foundry partners BOE and OliGHTEK. In addition, the recent announcements by Google about its second-generation Glass intended for industrial applications has furthered the momentum of AR headsets. Kopin’s displays and optic products are designed for these rugged applications.

“We also had a solid quarter in our military business. The four major production programs in our military business, including the F-35 pilot helmets, the Family of Weapon Sights Programs (Individual and Crew), and our VR optical system for armor vehicle simulation and training headsets, are all ramping and should have a very significant impact on our revenues in the second half of 2017 and in 2018.

“In our consumer segment, we have completed shipment of the first generation of SOLOSTM, our health and fitness AR glasses. The initial customers have been passionate about SOLOS and we have received excellent feedback from them. We expect to have the second generation of SOLOS on sale by the end of 2017.


“Finally we are making very good progress in our WhisperTM audio technology. In the second half of the year we expect to see the introduction of five new AR/VR headsets, of which two are Kopin systems and three are customer products. Of the five, four will feature our Whisper chip. In addition, we have made great progress in extending our Whisper technology from near-field to far-field applications. Early tests have shown the far field use matches the superior advantages in noise cancellation, voice quality, and speech recognition achieved in the near field application.

“On the strength of these new products and our current programs, we are optimistic about the revenue growth for the balance of the year and beyond. We anticipate revenues in the second half of 2017 will increase by approximately 70% as compared to the first half of 2017. Careful deployment of our financial resources, as always, remains a key priority. We ended the quarter with $85 million in cash and no debt, providing sufficient capital to monetize and commercialize our investments.

“In summary, we have successfully completed the first phase of technology and product development. We are now entering the harvesting and growth phase, and we are actively increasing sales and marketing efforts. All the cylinders are now working,” concluded Dr. Fan.

Second Quarter Financial Results

Total revenues for the second quarter ended July 1, 2017 were $5.9 million, compared with $4.4 million for the second quarter ended June 25, 2016.

Research and development (R&D) expenses for the second quarter of 2017 were $4.7 million compared to $4.1 million for the second quarter of 2016.

Selling, general and administrative (SG&A) expenses were $5.2 million for the second quarter of 2017 compared to $4.3 million for the second quarter of 2016, reflecting an increase in amortization of intangible assets, accrual of contingent earn out and professional fees. Included in SG&A is incremental SG&A expense of $0.5 million from the Company’s acquisition of NVIS, which was completed in the first quarter of 2017.

Net loss for the second quarter of 2017 was $7.3 million, or $0.10 per share, compared with net loss of $3.2 million, or $0.05 per share, for the second quarter of 2016. The second quarter of 2016 included a $7.7 million gain on the sale of our Korean subsidiary

During the second quarter of 2017 we had 9 patents granted and filed for 2 new applications. Overall we have over 300 patents and patents pending, almost all of which are related to wearable applications.

As of July 1, 2017 Kopin had approximately $85 million in cash equivalents and marketable securities, and no long term debt.

All amounts above are estimates and readers should refer to our Form 10-Q for the quarter ended July 1, 2017, for final disposition.


Financial Results Conference Call

In conjunction with its second quarter 2017 financial results, Kopin will host a teleconference call for investors and analysts at 8:30 a.m. ET today. To participate, please dial (877) 709-8150 (U.S. and Canada) or (201) 689-8354 (International). The call will also be available as a live and archived audio webcast on the “Investors” section of the Kopin website, www.kopin.com.

About Kopin

Kopin Corporation is a leading developer and provider of innovative wearable technologies and solutions for integration into head-worn computing and display systems to military, industrial and consumer customers. Kopin’s technology portfolio includes ultra-small displays, optics, speech enhancement technology, system and hands-free control software, low-power ASICs, and ergonomically designed smart headset reference systems. Kopin’s proprietary components and technology are protected by more than 300 global patents and patents pending. For more information, please visit Kopin’s website at www.kopin.com.

Kopin, Lightning, SOLOS, and Whisper are trademarks of Kopin Corporation.


Forward-Looking Statements

Statements in this press release may be considered “forward-looking” statements under the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. These include, without limitation, statements relating to our belief that revenue in the second half of 2017 will increase 70% as compared to the first half of 2017; that five new headsets will be introduced in the second half of 2017 of which two will be Kopin products and three will be customer products; that our four military programs will continue to ramp and should have a very significant impact on our revenues in the second half of 2017 and 2018; that our revenue growth momentum is accelerating; our belief that the commercial AR/VR opportunities are beginning to materialize; our expectation that the second generation of SOLOS will be on sale by the end of 2017; our expectation that four of the five new headsets introduced in the second half of 2017 will feature our Whisper chip; and that we have sufficient capital to monetize and commercialize our investments. These statements involve a number of risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. These risks and uncertainties include, but are not limited to, the following: Our revenues may not grow in the second half of 2017; here may be delays and the five new headset products may not be introduced; the five new headset products may not gain market acceptance; our military programs may not continue to ramp and they may be delayed, cancelled or not funded; our revenue momentum may stop; our revenues may decline for a variety of reasons including, but not limited to, lack of market acceptance, production issues, material supply issues and pricing issues; four of the five new headsets may not have the Whisper chip in them; our Whisper Chip may not work for far field applications; our Whisper Chip may not achieve market acceptance; the second generation of Solos may not be introduced in the second half of 2017; we may have insufficient fund to monetize and or commercialize our investment; we may not be well positioned as the VR and AR markets begin to accelerate; our progress may not lead to the growth of the AR and VR markets; the AR and VR markets may take longer to develop than we anticipate; there may be no demand for our AR and VR products; and other risk factors and cautionary statements listed in Kopin’s periodic reports and registration statements filed with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the 12 months ended December 31, 2016, and Kopin’s subsequent filings with the Securities and Exchange Commission. You should not place undue reliance on any forward-looking statements, which are based only on information currently available to Kopin and only as of the date on which they are made. We undertake no obligation to update any of these forward-looking statements to reflect events or circumstances occurring after the date of this release.


               
Kopin Corporation
Supplemental Information
(Unaudited)
 

Three Months Ended

Six Months Ended

 

July 1, 2017

June 25, 2016

July 1, 2017

June 25, 2016

Display Revenues by Category (in millions)

Wearable Applications $ 0.9 $ 1.8 $ 1.5 $ 4.4
Military Applications 1.0 0.9 2.0 2.4
Industrial Applications 2.7 1.0 4.5 2.2
Consumer Electronics Applications 0.4 0.4 0.9 1.1
Research and Development   0.9   0.3   1.4   0.4
Total $ 5.9 $ 4.4 $ 10.3 $ 10.5
 
 
Stock-Based Compensation Expense
Continuing Operations
Cost of component revenues $ 159,000 $ 148,000 $ 263,000 $ 290,000
Research and development 195,000 132,000 413,000 249,000
Selling, general and administrative   322,000   615,000   1,292,000   412,000
$ 676,000 $ 895,000 $ 1,968,000 $ 951,000
 
 
Other Financial Information
Depreciation and amortization $ 699,000 $ 316,000 $ 1,143,000 $ 652,000
 

   
Kopin Corporation
Condensed Consolidated Statements of Operations
(Unaudited)
           
Three Months Ended Six Months Ended

July 1, 2017

June 25, 2016

July 1, 2017

June 25, 2016

Revenues:
Net product revenues $ 4,979,400 $ 4,096,529 $ 8,912,543 $ 10,074,663
Research and development revenues   948,069     258,746     1,393,054     399,750  
5,927,469 4,355,275 10,305,597 10,474,413
Expenses:
Cost of product revenues 4,117,226 4,646,846 7,234,583 9,282,887
Research and development 4,678,221 4,119,401 8,960,090 8,159,352
Selling, general and administrative 5,200,261 4,282,264 10,841,947 8,043,113
Gain on sale of property and plant   -     (7,700,522 )   -     (7,700,522 )
13,995,708 5,347,989 27,036,620 17,784,830
 
Loss from operations (8,068,239 ) (992,714 ) (16,731,023 ) (7,310,417 )
 
Other income (expense), net   807,699     100,986     384,606     (275,098 )
 
Loss before benefit (provision) for income taxes and net loss (7,260,540 ) (891,728 ) (16,346,417 ) (7,585,515 )
(income) from noncontrolling interest
 
(Provision) benefit for income taxes   -     (1,963,000 )   1,146,000     (2,104,000 )
 
Net loss (7,260,540 ) (2,854,728 ) (15,200,417 ) (9,689,515 )
 
Net (income) loss attributable to noncontrolling interest   (71,431 )   (339,374 )   10,007     (438,047 )
 
Net loss attributable to the controlling interest $ (7,331,971 ) $ (3,194,102 ) $ (15,190,410 ) $ (10,127,562 )
 
Net loss per share:
Basic and diluted $ (0.10 ) $ (0.05 ) $ (0.22 ) $ (0.16 )
 
Weighted average number of common shares outstanding:
Basic and diluted   70,626,542     64,011,571     67,582,615     63,994,809  
 

 
Kopin Corporation
Condensed Consolidated Balance Sheets
(Unaudited)
       

July 1, 2017

December 31, 2016

ASSETS
Current assets:
Cash and marketable securities $ 84,908,544 $ 77,197,896
Accounts receivable, net 1,943,272 1,699,195
Inventory 4,412,962 3,302,112
Prepaid and other current assets   1,532,106   1,194,901
 
Total current assets 92,796,884 83,394,104
 
Land, equipment and improvements, net 3,708,747 2,976,006
Goodwill and intangible assets 4,189,434 844,023
Other assets   938,791   618,139
 
Total assets $ 101,633,856 $ 87,832,272
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,182,746 $ 4,355,462
Accrued expenses 7,153,590 5,457,484
Deferred income taxes 2,623,679 2,571,000
Billings in excess of revenue earned   1,027,227   981,761
 
Total current liabilities 14,987,242 13,365,707
 
Lease commitments 260,668 246,922
 
Total Kopin Corporation stockholders' equity 86,260,343 74,077,686
Noncontrolling interest   125,603   141,957
Total stockholders' equity   86,385,946   74,219,643
Total liabilities and stockholders' equity $ 101,633,856 $ 87,832,272
 

CONTACT:
Kopin Corporation
Richard Sneider, 508-870-5959
Treasurer and Chief Financial Officer
Richard_Sneider@kopin.com
or
Market Street Partners
Joann Horne, 415-445-3233
JHorne@marketstreetpartners.com

Additional Files
FileSequenceDescriptionTypeSize
0001157523-17-002313.txt   Complete submission text file   81557
$KOPN

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