Dynasil Corporation Of America Reports Fiscal Year 2011 Financial Results

Dynasil Corporation of America (NASDAQ: DYSL), a leading developer of sensing, detection and analysis technology for homeland security, medical and industrial applications, today reported financial results for fiscal year ended September 30, 2011.

Revenue for fiscal 2011 increased to $47.0 million compared with $43.0 million in fiscal 2010. Contract Research segment revenue increased to $24.9 million from $23.1 million in fiscal 2010. The Company’s renamed Products & Technology segment (previously called “Optics/Photonics, Products & Instruments”) posted revenue of $22.1 million, up from $19.9 million a year earlier.

Net income for the 12 months ended September 30, 2011 was $1.4 million, or $0.08 per diluted share, compared with $3.2 million, or $0.22 per diluted share, in fiscal 2010. Lower net income in the 2011 period resulted from higher selling, general and administrative expenses and increased investment in corporate growth initiatives, partially offset by Research & Experimentation (R&E) Tax Credits. For fiscal year 2011, the Company had an income tax expense of $293,198 compared with an income tax expense of $929,661 for fiscal year 2010. The significant difference primarily resulted from state and federal R&E tax credits of approximately $1.5 million in fiscal 2011, partially offset by the required deferred tax liability recorded for the tax effects of book/tax differences related to Property, Plant and Equipment, Goodwill, and Intangible Assets.

“Dynasil delivered 9 percent revenue growth in 2011, with gains in both business segments despite a challenging economic environment,” said Steven Ruggieri, the Company’s president and chief executive officer. “Our Contract Research segment grew $1.8 million, or nearly 8 percent, from fiscal 2010, reflecting robust business with key federal customers including the U.S. Department of Homeland Security and the U.S. Department of Energy. Our Products & Technology segment grew more than $2 million, or 11 percent, from the year-earlier period, primarily as a result of our acquisition of Hilger Crystals in the fourth quarter of fiscal 2010.”

Product Pipeline

“During the fourth quarter of 2011 we began shipping our dual-mode radiation detectors to OEM customers for beta testing, and we remain on track to begin generating revenue from this program in 2012,” Ruggieri said. “Our dual-mode technology represents the first in a planned pipeline of scintillation crystal products capable of advanced radiation detection for markets including homeland security, baggage screening and energy.”

“Our product pipeline also includes sensors for non destructive testing, radiation dosimeters based on technologies developed at our RMD Research business unit and thin film digital X-rays,” Ruggieri continued. “In addition, we are testing and evaluating three of the biomedical technologies acquired earlier this year from Dr. Daniel Ericson. While development is still in the early stages, we believe that these technologies have commercial potential.”

Recent Highlights
  • Dynasil promoted Kanai S. Shah, Ph.D., Vice President of Research and leader of the Materials Science Group, to President of RMD Research, the Company’s research business unit, beginning in December. Dr. Shah, 50, joined RMD in 1985 as a Staff Scientist. He became Director of Research in 2002 and Vice President of Research in 2009. He has been responsible for new semiconductor and scintillator development at RMD for more than a decade.
  • RMD Research received contracts totaling $3.65 million from the Department of Homeland Security’s Domestic Nuclear Detection Office (DNDO). These contracts provide funded research and development of gamma and neutron radiation detectors capable of identifying illicit nuclear materials. The contracts consist of $2.15 million under the DNDO’s Exploratory Research Program (ERP) and $1.5 million under the Small Business Innovation Research (SBIR) program. Earlier this month, the U.S. House and Senate negotiated a deal to reauthorize the SBIR program for an additional six years.

“In fiscal 2011 we made good progress in expanding our product pipeline and diversifying our contract research business,” Ruggieri said. “In the coming quarters, we expect to have a product realization process in place designed to support the evaluation, assessment, development and commercialization of our technologies. We have a number of exciting milestones to look forward to in 2012, and we believe that we are well positioned for continued growth.”

Conference Call Information

As previously announced, Dynasil Corporation will host a conference call for investors and analysts Thursday, December 29, 2011 at 5:00 p.m. ET. On the call will be Dynasil President and Chief Executive Officer Steven Ruggieri and Chief Financial Officer Richard Johnson. Those who wish to listen to the conference call and view presentation slides should visit the Investor Information section of the Company’s website at www.dynasilcorp.com. The call also may be accessed by dialing (877) 407-5790 or (201) 689-8328. For interested individuals unable to join the live conference call, a webcast replay will be available on the Company’s website for one year.

About Dynasil

Dynasil Corporation of America (NASDAQ: DYSL) develops and manufactures detection, sensing and analysis technology, precision instruments and optical components for the homeland security, medical and industrial markets. Combining world-class technology with expertise in research and materials science, Dynasil is commercializing products including dual-mode radiation detection solutions for Homeland Security and commercial applications, probes for medical imaging and sensors for non-destructive testing. Dynasil has an impressive and growing portfolio of issued and pending U.S. patents. The Company is based in Watertown, Massachusetts, with additional operations in Mass., Minn., NY, NJ and the United Kingdom. More information about the Company is available at www.dynasilcorp.com.

Forward-looking Statements

This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements regarding future events and our future results are based on current expectations, estimates, forecasts, and projections and the beliefs and assumptions of our management, including, without limitation, our expectations regarding results of operations, the commercialization of our products including our dual mode detectors, our development of new technologies including at Dynasil Biomedical, the adequacy of our current financing sources, our capital expenditures and the strength of our intellectual property portfolio. These forward-looking statements may be identified by the use of words such as “may,” “could,” “expect,” “estimate,” anticipate,” continue” or similar terms, though not all forward-looking statements contain such words. The actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements due to a number of important factors. These factors that could cause actual results to differ from those anticipated or predicted include, without limitation, our ability to develop and commercialize our products, the size and growth of the potential markets for our products and our ability to serve those markets, the rate and degree of market acceptance of any of our products, general economic conditions, costs and availability of raw materials and management information systems, our ability to obtain and maintain intellectual property protection for our products, competition, the loss of key management personnel, litigation, the effect of governmental regulatory developments, the availability of financing sources, our ability to identify and execute on acquisition opportunities and integrate such acquisitions into our business, and seasonality, as well as the uncertainties set forth in the Company’s Annual Report on Form 10-K and from time to time in the Company's other filings with the Securities and Exchange Commission. The Company disclaims any intention or obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
 
DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
 
ASSETS
2011 2010
Current assets
Cash and cash equivalents $ 4,479,840 $ 4,111,966

Accounts receivable, net of allowance for doubtful accounts of $182,634 and $132,584 and sales returns allowance of $18,356 and $24,168 for September 30, 2011 and September 30, 2010, respectively.
5,837,139 6,360,583
Inventories 3,250,539 3,097,219
Costs in excess of billings 408,240 135,157
Deferred tax asset 1,119,800 1,196,735
Prepaid income taxes 341,825 166,231
Prepaid expenses and other current assets   453,738   453,418
Total current assets 15,891,121 15,521,309
 
Property, Plant and Equipment, net 4,860,328 3,953,319
 
Other Assets
Intangibles, net 6,374,329 6,671,149
Goodwill 13,330,182 13,775,087
Deferred tax asset - non current 694,800 -0-
Deferred financing costs, net   150,656   190,568
Total other assets   20,549,967   20,636,804
 
Total Assets $ 41,301,416 $ 40,111,432
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current portion of long-term debt $ 1,859,728 $ 1,870,779
Accounts payable 2,088,395 1,482,250
Accrued expenses and other liabilities 2,322,459 2,177,743
Contingent consideration 183,713 -0-
Dividends payable  

-0-
  131,400
Total current liabilities 6,454,295 5,662,172
 
Long-term Liabilities
Long-term debt, net 8,985,442 10,833,334
Deferred tax liability 1,619,637 873,300
Contingent consideration   -0-   750,000
Total long-term liabilities 10,605,079 12,456,634
 
Temporary Equity 2,000,000 2,000,000
 
Stockholders' Equity 22,242,042 19,992,626
   
Total Liabilities and Stockholders' Equity $ 41,301,416 $ 40,111,432
 
 
DYNASIL CORPORATION OF AMERICA
CONSOLIDATED STATEMENTS OF OPERATIONS
   
  2011   2010
Net revenue $ 46,951,666 $ 42,969,762
Cost of revenue   27,683,729   25,205,960
Gross profit 19,267,937 17,763,802
Selling, general and administrative expenses   17,021,191   12,971,640
Income from operations 2,246,746 4,792,162
Interest expense, net   601,903   628,120
Income before income taxes 1,644,843 4,164,042
Income taxes   293,198   929,661
Net income $ 1,351,645 $ 3,234,381
 
 
Net Income $ 1,351,645 $ 3,234,381
Other comprehensive income:

Foreign currency translation, net of $83,318 and $77,400 income taxes in 2011 and 2010
  147,404   150,162
Total comprehensive income $ 1,499,049 $ 3,384,543
 
 
Net income $ 1,351,645 $ 3,234,381
Dividends on preferred stock   116,646   537,433
Net income applicable to common stockholders 1,234,999 2,696,948
Dividend add back due to preferred stock conversion   -0-   537,433
Net income for diluted income per common share $ 1,234,999 $ 3,234,381
 
Basic net income per common share $ 0.08 $ 0.22
Diluted net income per common share $ 0.08 $ 0.22
 
Weighted average shares outstanding
Basic 14,932,226 12,404,701
Diluted 15,127,004 14,937,575
 

Copyright Business Wire 2010

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