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Nanophase Reports Second Quarter 2016 Financial Results

Due to travel schedules, the company’s financial conference call is scheduled for August 5, 2016 at 11am EDT

ROMEOVILLE, Ill., July 27, 2016 (GLOBE NEWSWIRE) -- Nanophase Technologies Corporation (OTCQB:NANX), a technology leader in nanomaterials and advanced nanoengineered products, today reported financial results for the second quarter ended June 30, 2016. 

“Reporting both positive cash flow and positive net income for the quarter is a milestone, as we have never done that before,” commented Nanophase CEO and President Jess Jankowski.  “But the celebration was short lived.  We have larger goals.  In keeping with our strategy, namely, segregating those existing businesses that we continue to supply and support from the businesses inside which we are launching new products and actively developing new revenue streams, has helped us focus greater resources on higher value areas.”

Six Months Ended June 30, 2016 Financial Highlights

  • Revenue for the first six months of 2016 was $5.9 million, vs. the $5.2 million reported during the same period of 2015. 
     
  • The net loss for the first six months of 2016 was $0.1 million, or a loss of $0.00 per share, compared to a net loss of $0.7 million, or $0.02 per share, for the comparable period of 2015. 
     
  • The Company finished the quarter with approximately $1.4 million in cash and cash equivalents; the Company had no debt. 

Second Quarter 2016 Financial Highlights

  • Revenue for the second quarter was $3.7 million in 2016 and $2.9 million in 2015. 
     
  • The net profit for the quarter was $0.5 million in 2016, or $0.01 per share, compared to a net loss for the quarter of $0.1 million, or $0.00 per share, for 2015. 

Jankowski continued, “As we discussed last quarter, we are in the process of building new revenue streams in personal care and solar control.  We are also actively seeking to develop relationships to engage other sellers to promote certain other less strategic businesses while more directly and aggressively investing in those that we believe will create the highest return.” 

Shareholders and members of the financial community are encouraged to participate in the upcoming conference call, where Mr. Jankowski will discuss the company’s current and long-term prospects.

/EIN News/ -- Second Quarter 2016 Conference Call
Due to travel schedules, the Nanophase conference call, to be hosted by Jess Jankowski, the Company’s President & CEO, is scheduled for August 5, 2016, at 10:00 a.m. CDT, 11:00 a.m. EDT. The conference call dial-in number for U.S. callers is 877-312-8776 and for international callers is 408-774-4007.  The conference ID is 51617022.  Please dial in to the conference at least five minutes before the call is scheduled to begin.

The call may also be accessed through the company’s website, at www.nanophase.com, by clicking on Investor Relations, Investor News and the link in the July 18th conference call announcement release.

Use of Non-GAAP Financial Information
Nanophase believes that the presentation of results excluding certain items, such as non-cash equity compensation charges, provides meaningful supplemental information to both management and investors, facilitating the evaluation of performance across reporting periods. The Company uses these non-GAAP measures for internal planning and reporting purposes. These non-GAAP measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAP measures used by other companies. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net income or net income per share prepared in accordance with generally accepted accounting principles.

About Nanophase Technologies
Nanophase Technologies Corporation (NANX), www.nanophase.com, is a leader in nanomaterials technologies and provides nanoengineered solutions for multiple industrial product applications. Using a platform of patented and proprietary integrated nanomaterial technologies, the Company creates products with unique performance attributes from two ISO 9001:2008 and ISO 14001 facilities. Nanophase delivers commercial quantity and quality nanoparticles, coated nanoparticles, and nanoparticle dispersions in a variety of media. 

Forward-Looking Statements
This press release contains words such as “expects,” ”shall,” “will,” “believes,” and similar expressions that are intended to identify forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Such statements in this announcement are made based on the Company’s current beliefs, known events and circumstances at the time of publication, and as such, are subject in the future to unforeseen risks and uncertainties that could cause the Company’s results of operations, performance and achievements to differ materially from current expectations expressed in, or implied by, these forward-looking statements. These risks and uncertainties include, without limitation, the following: a decision by a customer to cancel a purchase order or supply agreement in light of the Company’s dependence on a limited number of key customers; uncertain demand for, and acceptance of, the Company’s nanocrystalline materials; the Company’s manufacturing capacity and product mix flexibility in light of customer demand; the Company’s limited marketing experience; changes in development and distribution relationships; the impact of competitive products and technologies; the Company’s dependence on patents and protection of proprietary information; the resolution of litigation in which the Company may become involved; the impact of any potential new government regulations that could be difficult to respond to or too costly to comply with while remaining financially viable; the ability of the Company to maintain an appropriate electronic trading venue; and other factors described in the Company’s Form 10-K filed March 29, 2016. In addition, the Company’s forward-looking statements could be affected by general industry and market conditions and growth rates. Except as required by federal securities laws, the Company undertakes no obligation to update or revise these forward-looking statements to reflect new events, uncertainties or other contingencies.

 
NANOPHASE TECHNOLOGIES CORPORATION
 
BALANCE SHEETS
 
       
     June 30,     
      2016      December 31, 
ASSETS (Unaudited)     2015  
           
Current assets:    
  Cash and cash equivalents $   1,424,385     $   1,275,402  
  Trade accounts receivable, less allowance for doubtful accounts       
  of $6,000 on June 30, 2016 and December 31, 2015     1,703,660         506,549  
  Other receivable     84         43  
  Inventories, net     597,026         661,593  
  Prepaid expenses and other current assets     442,278         247,726  
    Total current assets     4,167,433         2,691,313  
           
  Equipment and leasehold improvements, net     1,578,932         1,860,579  
  Other assets, net     21,142         22,381  
      $   5,767,507     $   4,574,273  
           
LIABILITIES AND STOCKHOLDERS' EQUITY      
Current liabilities:      
  Current portion of capital lease obligations     96,727         94,406  
  Accounts payable     637,926         507,643  
  Accrued expenses     479,833         276,287  
    Total current liabilities     1,214,486         878,336  
           
  Long-term portion of capital lease obligations     94,609         143,560  
  Long-term deferred rent     494,116         518,747  
  Asset retirement obligation     175,308         172,238  
    Total long-term liabilities     764,033         834,545  
           
           
Stockholders' equity:      
  Preferred stock, $.01 par value, 24,088 shares authorized and       
    no shares issued and outstanding     -      
  Common stock, $.01 par value, 35,000,000 shares authorized; 31,185,496         -  
    and 28,585,496 shares issued and outstanding on June 30, 2016 and     
    December 31, 2015, respectively     311,855         285,855  
  Additional paid-in capital     97,222,381         96,172,795  
  Accumulated deficit     (93,745,248 )       (93,597,258 )
  Total stockholders' equity     3,788,988         2,861,392  
    $   5,767,507     $   4,574,273  
 

 

 
NANOPHASE TECHNOLOGIES CORPORATION
 
STATEMENTS OF OPERATIONS
   
(Unaudited)
 
    Three months ended   Six months ended
    June 30,   June 30,
      2016       2015       2016       2015  
Revenue:  
  Product revenue, net     $   3,677,876     $   2,921,386     $   5,867,099     $   5,221,184  
  Other revenue         5,200         16,228         27,081         26,615  
  Net revenue         3,683,076         2,937,614         5,894,180         5,247,799  
                 
Operating expense:                  
  Cost of revenue         2,170,568         1,945,526         3,925,204         3,690,077  
  Gross profit         1,512,508         992,088         1,968,976         1,557,722  
                 
  Research and development expense         371,828         342,980         673,426         644,890  
  Selling, general and administrative expense       674,740         739,291         1,435,961         1,606,366  
Income/(Loss) from operations          465,940         (90,183 )       (140,411 )       (693,534 )
Interest income         -         -         -         -  
Interest expense         (3,872 )       (3,204 )       (8,130 )       (5,728 )
Other, net         544         -         551         -  
Income/(Loss) before provision for income taxes       462,612         (93,387 )       (147,990 )       (699,262 )
Provision for income taxes         -         -         -         -  
Net income/(loss)     $   462,612     $   (93,387 )   $   (147,990 )   $   (699,262 )
       
 
Net income/(loss) per share- basic and diluted     $   0.01     $   -     $   -     $   (0.02 )
 
Weighted average number of basic and diluted                 
  common shares outstanding         31,185,496         28,585,496         30,599,782         28,564,133  
 
 
NANOPHASE TECHNOLOGIES CORPORATION
 
STATEMENTS OF OPERATIONS - EXPANDED SCHEDULE
   
(Unaudited)
 
    Three months ended   Six months ended
    June 30,   June 30,
      2016       2015       2016       2015  
Revenue:  
  Product revenue, net     $   3,677,876     $   2,921,386     $   5,867,099     $   5,221,184  
  Other revenue         5,200         16,228         27,081         26,615  
  Net revenue         3,683,076         2,937,614         5,894,180         5,247,799  
                 
Operating expense:                  
  Cost of revenue detail:                  
  Depreciation         139,710         143,024         282,633         287,346  
  Non-Cash equity compensation         5,523         6,032         11,516         11,667  
  Other costs of revenue         2,025,335         1,796,470         3,631,055         3,391,064  
  Cost of revenue         2,170,568         1,945,526         3,925,204         3,690,077  
  Gross profit         1,512,508         992,088         1,968,976         1,557,722  
                 
  Research and development expense detail:                
  Depreciation         29,031         28,765         57,587         58,730  
  Non-Cash equity compensation         8,880         8,999         18,211         17,344  
  Other research and development expense       333,917         305,216         597,628         568,816  
  Research and development expense         371,828         342,980         673,426         644,890  
                 
  Selling, general and administrative expense detail:            
  Depreciation and amortization         10,326         10,085         20,535         20,268  
  Non-Cash equity compensation         26,562         32,369         57,859         65,074  
  Other selling, general and administrative expense     637,852         696,837         1,357,567         1,521,024  
  Selling, general and administrative expense     674,740         739,291         1,435,961         1,606,366  
Income/(Loss) from operations          465,940         (90,183 )       (140,411 )       (693,534 )
Interest income         -         -         -         -  
Interest expense         (3,872 )       (3,204 )       (8,130 )       (5,728 )
Other, net         544         -         551         -  
Income/(Loss) before provision for income taxes       462,612         (93,387 )       (147,990 )       (699,262 )
Provision for income taxes         -         -         -         -  
Net income/(loss)     $   462,612     $   (93,387 )   $   (147,990 )   $   (699,262 )
                   
Non-GAAP Disclosure (see note regarding Non-GAAP disclosures):            
  Addback Interest, net       3,872         3,204         8,130         5,728  
  Addback Depreciation/Amortization       179,067         181,874         360,755         366,344  
  Addback Non-Cash Equity Compensation       40,965         47,400         87,586         94,085  
 
  Adjusted EBITDA   $   686,516     $   139,091     $   308,481     $   (233,105 )
 

 

COMPANY CONTACT
                    Nancy Baldwin
                    Investor Relations
                    630-771-6708

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