Super Vision International, Inc. (NASDAQ:SUPVA), a world leader in
solid-state LED and fiber optic lighting systems and controls used
in commercial, architectural, signage, swimming pool and retail
lighting applications today announced financial results for the
full year ended December 31, 2005 and the restatement of the
quarterly results for the first three quarters of 2005 and the full
year ended December 31, 2004. 2005 Financial Results Total revenue
for the year increased to $12.0 million as compared to $11.9
million in 2004, driven by a 21% increase in LED revenue in 2005
offset by a 15% decrease in sales of fiber optic lighting products.
2005 was a milestone year for the company as revenue from LED
lighting systems surpassed revenue from fiber optic lighting
systems for the first time in the company's history. LED revenues
accounted for 49% of the company's sales compared to 41% in 2004.
Fiber optic revenue represented only 47% of total revenue compared
to 55% of total revenue in 2004 and 66% in 2003. Gross margins for
the year improved to 41% in 2005 compared to 36% in 2004 as
restated (39% compared to 36% as restated excluding a one-time
settlement recovery of $240,000 received in 2005 for damaged and
faulty parts charged to cost of sales in prior years) as a result
of cost reduction initiatives and improvements in operational
efficiencies. The net loss for the year was approximately $488,500
or ($0.19) per basic and diluted share as compared to a restated
net loss of approximately $401,400, or ($0.16) per basic and
diluted share for 2004. The increase in net loss was driven
primarily by increased research and development expenses, legal
fees, wages, benefits and a one-time severance expense. New
President and Chief Executive Officer Mike Bauer said,
"Repositioning Super Vision International to capitalize on the
emerging market for solid-state LED lighting systems and controls,
expanding our product platform through strategic investments and
reconfiguring our facility for improved operational efficiencies
and higher gross margins were our primary goals in 2005 and we
achieved them. The investments in new product development and our
new training and development center were long overdue and as the
market for fiber optic lighting has matured we felt it was critical
to make these key moves to break out of the past, accelerate our
revenue growth and drive the company to profitability. It is an
exciting time for our company. The overall market for high
brightness, solid-state lighting systems is estimated to grow at
over 20% in the next several years. Our goal is to capitalize on
this opportunity and become a leader in the market." "Sales to date
of our new SaVi(TM) brand of architectural LED lighting products
that we began shipping last April have exceeded $1 million and we
have introduced three new state-of-the-art high density array LED
SaVi(TM) products that we expect to start shipping in the 2nd
quarter of 2006. In addition, during 2005, we filed six new patent
applications and were issued another patent in December, bringing
our total number of issued patents to nineteen." Earlier this month
the company, along with its independent registered public
accounting firm, Cross, Fernandez & Riley, LLP, determined to
restate its previously filed financial statements for the year
ended December 31, 2004 and the quarters ended March 31, June 30
and September 30, 2005 to reflect the capitalization of overhead
and freight-in costs on inventory items not previously capitalized
and the correction of an error in our overhead rate. The
restatement resulted from a reassessment of the company's current
methodology for capitalizing labor and overhead due to the change
in product mix from fiber optics to LED based products over the
last three years. As a result of the restatement, the company's
accumulated deficit decreased by $434,967 as of December 31, 2004
and the company's net loss for 2004 increased by $69,231 from
$332,201 to $401,432, or an increased loss of $0.03 per basic and
diluted share. The impact of the restatement on the quarterly
unaudited financial statements for the three previously reported
quarters in 2005 is disclosed in our 10-KSB for the year ended
December 31, 2005 filed with the Securities and Exchange Commission
on March 29, 2006 and in the company's Current Report on Form 8-K
filed with the Securities and Exchange Commission on March 22,
2006. "2005 was a milestone year for Super Vision as we diversified
our product platform, transitioned to new senior leadership, began
executing a new strategic vision for the company and invested in
our future," stated Dan Regalado, Executive Vice President and
Chief Financial Officer. "Gross margins increased year over year by
200 basis points excluding the one-time benefit of a settlement
that reduced our cost of sales, and in February 2006, we
established a $1.2 million revolving line of credit to finance
additional investments or working capital needs that might arise."
Operating expenses for the year increased 16% compared to 2004
primarily driven by higher legal expenses, higher research and
development expenses, increased wages and benefits, and a one-time
severance expense. Total operating expenses for 2005 were $5.2
million as compared to $4.5 million in 2004 as restated. EBITDA,
which is Earnings Before Interest, Taxes, Depreciation and
Amortization, is a non-GAAP financial measure which management uses
as part of its performance appraisal in reviewing the Company's
ongoing operational business trends related to its financial
condition and results of operations. For the year ended December
31, 2005, EBITDA was approximately $467,500 compared to $644,300 in
2004. The Company had cash and investments of approximately $1.3
million at December 31, 2005 with a current ratio of 3.2 to 1. 2005
Highlights -- Successful President/CEO transition announced and
executed. -- LED revenues increased 21%. -- Gross Margins improved
8.0% to 39% on a normalized basis. -- New SaVi(TM) brand of
architectural LED products was introduced. -- New LED and Fiber
Optic Training and Development Center opened in November. -- Six
patent applications were filed; one new patent was issued bringing
the total for issued company patents to nineteen. About Super
Vision International, Inc. Super Vision International's vision is
to incorporate Light, Color and Imagination with advanced
technology to become one of the world's leading suppliers of
lighting and lighting control products that add visual excitement,
accent, impact and identity to commercial and residential lighting
projects around the world. For more information, please visit the
Super Vision web site at http://www.svision.com. Certain of the
above statements contained in this press release are
forward-looking statements that involve a number of risks and
uncertainties. Such forward-looking statements are within the
meaning of that term in Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934. Reference
is made to Super Vision's filings under the Securities Exchange Act
for factors that could cause actual results to differ materially.
Super Vision undertakes no obligation to publicly update or revise
any forward-looking statements, whether as a result of new
information, future events, or otherwise. Readers are cautioned
that any such forward-looking statements are not guarantees of
future performance and involve risks and uncertainties, and that
actual results may differ materially from those indicated in the
forward-looking statements as a result of various factors. Readers
are cautioned not to place undue reliance on these forward-looking
statements. -0- *T SUPER VISION INTERNATIONAL, INC. STATEMENTS OF
OPERATIONS Year Ended December 31, 2005 2004 (as restated)
------------ ------------- Revenues $11,983,223 $11,894,666 Cost of
sales 7,110,595 7,605,656 ------------ ------------- Gross margin
4,872,628 4,289,010 Operating expenses: Selling, general and
administrative 4,691,905 4,087,412 Research and development 552,209
418,177 (Gain) Loss on disposal of property and equipment (6,000)
18,937 ------------ ------------- Total operating expenses
5,238,114 4,524,526 ------------ ------------- Operating loss
(365,486) (235,516) Non-operating income (expense): Interest income
55,540 32,392 Other income 189,480 192,691 Interest expense
(367,992) (390,999) ------------ ------------- Total non-operating
expense, net (122,972) (165,916) ------------ ------------- Net
loss $ (488,458) $ (401,432) ============ ============= Basic and
diluted loss per common share $ (0.19) $ (0.16) ============
============= Basic and diluted weighted average shares outstanding
2,542,579 2,541,601 ============ ============= *T -0- *T Selected
Balance Sheet Data As of December 31, 2005 2004 (as restated)
------------- ------------- Cash and investments $ 1,274,150 $
1,926,042 Current assets $ 6,311,190 $ 6,679,561 Total assets $
9,323,808 $ 9,829,528 Current liabilities $ 1,995,530 $ 1,794,366
Total liabilities $ 4,288,386 $ 4,313,034 Total stockholders'
equity $ 5,035,422 $ 5,516,494 *T -0- *T Reconciliation of Non-GAAP
Financial Measure The following table reconciles GAAP to non-GAAP
financial measure: Earnings Before Interest Taxes Depreciation and
Amortization Year Ended December 31,
------------------------------------- 2005 2004 Change % (as
restated) ------------------------------------- Net Loss (488,458)
(401,432) (87,026) (22%) Plus: Interest expense 367,992 390,999
(23,007) (6%) Depreciation 549,311 580,165 (30,854) (5%)
Amortization and impairment 38,654 74,556 (35,902) (48%) Taxes --
-- -- -- ------------------------------------- EBITDA 467,499
644,288 (176,789) (27%) ===================================== % of
Revenues 4% 5% *T
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