Precision Optics Corporation's Financial Insights for 2024

Precision Optics Reports Fiscal Year 2024 Financial Performance

Precision Optics Corporation, Inc. (NASDAQ: POCI) is a respected provider of optical instruments tailored for the medical and defense sectors. This year, the company has disclosed its unaudited financial outcomes for the fourth quarter and the entire fiscal year ending June 30, 2024.

Key Financial Highlights for FY 2024

In the fiscal year 2024, Precision Optics achieved several noteworthy financial results:

• Revenue totaled $19.1 million, a drop from the previous year's $21.0 million, yet exceeding the anticipated range of $18.9 million.
• Production revenue was reported at $10.8 million, declining by 25% when compared to the previous year.
• The engineering segment saw remarkable growth with revenue reaching $8.3 million— a 24% increase year-over-year.
• Gross margin stood at 30.3%, a decline from 36.8% in FY 2023, which had included a one-time sale of technology rights.
• Net loss for the year amounted to ($3.0) million, compared to a lesser loss of ($0.1) million in FY 2023.
• Adjusted EBITDA was $(1.6) million, significantly decreased from the previous year's positive $0.5 million.

Fourth Quarter Achievements

The fourth quarter ending June 30, 2024, showcased the following performance metrics:

• Revenue reached $4.7 million, slightly lower than the $5.0 million reported in the same quarter last year but surpassing the forecast of $4.5 million.
• Engineering revenue improved to $1.9 million, up from $1.4 million in the same quarter of the previous year.
• Meanwhile, production revenue was reported at $2.8 million, down from $3.6 million in Q4 of FY 2023.
• Gross margins decreased to 21.7%, from 35.0% in the same quarter last year.
• For the quarter, the net loss was ($1.4) million compared to a loss of ($0.1) million in the prior year's quarter.
• Adjusted EBITDA for Q4 was $(1.1) million, less favorable than the $(0.4) million recorded a year earlier.

Notable Recent Developments

Several impactful events unfolded in the recent months, boosting the company's outlook:

• A significant $9 million production order was proudly announced in May 2024 for a single-use cystoscopy surgery program, with production shipments commencing in July 2024.
• In August 2024, Precision Optics successfully completed a $1.4 million registered direct offering, involving participation from key company officers and directors.

Executive Insights

Joseph Forkey, CEO of Precision Optics, reflected on the challenges faced at the end of FY 2023, particularly the loss of $7 million in annualized revenue from several programs not continuing into FY 2024. However, the robust engineering pipeline has compensated for significant portions of this shortfall, fueled by record levels of product development revenue and new products transitioning into production.

Looking ahead to fiscal 2025, the company anticipates revenue for the first quarter to be between $4.2 and $4.4 million, remaining consistent with the first quarter of FY 2024 despite previous challenges linked to the commencement of key production programs. The CEO remains optimistic about double-digit revenue growth with significant rises expected from the second quarter of the fiscal year.

Conclusion and Future Outlook

As Precision Optics continues to stabilize and grow, their commitment to innovation in both medical devices and aerospace optics places them on a promising trajectory. With a solid foundation and emerging production programs, the company appears well-positioned to meet increasing market demands while navigating financial challenges.

Frequently Asked Questions

1. What are the main highlights from Precision Optics' FY 2024 financial results?

Precision Optics reported a total revenue of $19.1 million, a net loss of ($3.0) million, and an adjusted EBITDA of $(1.6) million.

2. How did the engineering segment perform in FY 2024?

The engineering revenue reached a record $8.3 million, representing a 24% increase compared to the previous fiscal year.

3. What recent orders has Precision Optics announced?

In May 2024, the company announced a significant $9 million production order for a single-use cystoscopy surgery program.

4. What are the expectations for FY 2025 revenue?

The company expects first-quarter revenue in the range of $4.2 to $4.4 million, with projections for double-digit growth in subsequent quarters.

5. Who is the CEO of Precision Optics, and what is his outlook for the company?

Joseph Forkey is the CEO, and he remains optimistic about the company's transition from development to production and the potential for recovery in revenue.

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