Exhibit 99.1
Kopin Reports Third Quarter 2004 Financial
Results; Year-Over-Year Revenue Growth: III-V, 62 Percent;
CyberDisplay, 15 Percent
TAUNTON, Mass.--(BUSINESS WIRE)--Oct. 28, 2004--Kopin Corporation
(NASDAQ: KOPN) today announced financial results for the third quarter
ended September 25, 2004.
Key Points for the Third Quarter of 2004:
-- Revenue increased 31 percent year-over-year to $22.9 million
compared with $17.5 million in the third quarter of 2003, and
declined three percent from $23.6 million in the second
quarter of 2004.
-- Net loss was $1.1 million, or $0.02 per share, compared with a
net loss of $3.0 million, or $0.04 per share, for the third
quarter of 2003 and a net loss of $2.3 million, or $0.03 per
share, in the second quarter of 2004.
-- CyberDisplay revenue increased 15 percent year-over-year to
$13.2 million and remained flat on a sequential basis.
-- III-V revenue rose 62 percent year-over-year and decreased
seven percent sequentially to $9.7 million.
"Kopin's third-quarter financial results reflect continued solid
performance within our HBT products group as well as initial volume
production CyberDisplay shipments to military customers, which offset
a slowing camcorder market," said President and Chief Executive
Officer Dr. John C.C. Fan. "As a result, we achieved our expectation
for 30 percent year-over-year revenue growth."
Volume Shipments to Military Customers Drive CyberDisplay Revenue
Third-quarter CyberDisplay(TM) revenue was $13.2 million, flat
with the $13.2 million reported in the second quarter of 2004 and up
15 percent from the same period in 2003. During the quarter, Kopin
began shipping its CyberDisplay in volume quantities to military
customers for thermal imaging applications. This marks the first time
the Company has shipped CyberDisplay products in high volume for
military applications. In the consumer market, Kopin continued to
broaden its penetration into non-camcorder applications. Wireless
pioneer Nokia selected Kopin's CyberDisplay 180K as the color
microdisplay for the Kaleidoscope I, an innovative picture viewing and
storage accessory for digital still cameras and next-generation
camera-equipped wireless handsets. In addition, Kopin is supplying a
microdisplay system to Accupix, a near-to-eye application leader based
in Korea. Designed for Accupix's new MPG-230M multimedia virtual movie
theater, the microdisplay system features the CyberDisplay 180K, as
well as a TV decoder and driver chipset.
"We continue to successfully execute on our long-term strategy to
expand the CyberDisplay's application base in consumer, industrial and
military electronics. During the quarter, we began initial production
shipments to Raytheon for thermal weapon sights and added Nokia and
Accupix to our roster of consumer electronics customers. At the same
time, we continued to make significant advances in our display
technology by introducing low-voltage versions of our 113K and 230K
microdisplays. These new products exemplify our philosophy of
relentless innovation, a strategy we believe will enable us to
continue to expand our market penetration," said Dr. Fan. "Looking
into 2005 and beyond, we expect accelerating demand for digital still
cameras and mobile video applications to be significant industry
growth drivers for Kopin."
Industry Growth Drives III-V Performance
Kopin posted III-V revenue of $9.7 million in the third quarter,
compared with revenue of $10.4 million in the second quarter of 2004
and $6.0 million in the third quarter of 2003. "Demand for Kopin's
HBTs in the wireless handset and WLAN markets remains steady. In
addition, customers sampling our new GAIN HBT have reported excellent
performance and durability test results. Our goal remains to secure a
design win for the new transistor by the end of the year," said Dr.
Fan.
"Within our CyberLite product group, we are evaluating options for
this product line, with the goal of pairing Kopin's superior
technology with a lower cost manufacturing base. A number of companies
have approached us about potential partnerships, and we expect to
complete the evaluation process by the end of this year. In parallel,
we are continuing our efforts to make new high-performance CyberLite
products aimed at mid- and high-end LED applications."
Nine-Month Results
For the nine months ended September 25, 2004, total revenue
increased to $68.8 million from $55.4 million for the same period last
year. Revenue from III-V products was $29.6 million for the first nine
months of 2004, an increase of approximately 22 percent over revenue
of $24.2 million for the first nine months of 2003. CyberDisplay
revenues increased 25 percent to $39.2 million in the first nine
months of 2004 from $31.3 million in the same period in 2003. The net
loss for the most recent nine-month period was $6.8 million, or $0.10
per share, compared with a net loss of $6.3 million, or $0.09 per
share, for the first nine months of 2003.
Business Outlook
Commenting on Kopin's outlook for the fourth quarter of 2004, Dr.
Fan said, "During the fourth quarter, we expect to see traditional
seasonality in the wireless handset and consumer electronics markets,
including continued industry softness in the camcorder market. As a
result, we anticipate that total fourth-quarter revenue will be in the
range of $18.0 million to $20.0 million. Longer term, our strong
balance sheet - with more than $110 million in cash and no debt - will
enable us to continue developing innovative products and capitalize on
the emerging portable technologies that are changing the way people
communicate and share experiences."
Third-Quarter Conference Call
Kopin will provide a live audio webcast of its third-quarter
conference call for investors at 10:00 a.m. ET today, October 28,
2004. Investors who want to hear the call should log on to the
Investor Relations section of Kopin's website, www.kopin.com, at least
15 minutes before the event's broadcast. The call will be available on
the Investor Relations section for one week. After that, investors can
access an archived version of the call on Kopin's website.
Kopin's third-quarter 2004 conference call also can be heard live
by dialing (801) 983-4013 or (800) 937-6563 five minutes prior to the
call. A replay of the call will be available from 1:00 p.m. ET,
Thursday, October 28 through midnight ET, Wednesday, November 3. To
access the replay, dial (719) 457-0820 or (888) 203-1112 and refer to
confirmation code 867339.
About Kopin
Founded in 1984, Kopin is pioneering the use of nanotechnology to
manufacture nanosemiconductor products that make mobile electronic
devices small, fast, bright, lightweight and power efficient. With an
intellectual property portfolio of more than 200 issued and pending
patents, Kopin supplies the world's largest electronics manufacturers
and government agencies with breakthrough semiconductor products. The
Company's liquid-crystal microdisplays, ultra-efficient transistors
and high-brightness light emitting diodes (LEDs) enhance the delivery
and presentation of voice, video and data. Kopin technology is
currently used in nearly one-third of the world's cell phones and
camcorders and is the microdisplay standard for the U.S. military. For
more information, please visit Kopin's website at www.kopin.com.
Statements in this news release may be considered
"forward-looking" statements under the "Safe Harbor" provisions of the
Private Securities Litigation Reform Act of 1995. These include
statements relating to Kopin's expectation that Kopin's new
CyberDisplay products will enable the Company to penetrate more
segments of the market; that accelerating demand for digital still
cameras and mobile video products will be growth drivers for the
Company; that Kopin will complete its evaluation of CyberLite business
models by the end of the year; that Kopin will experience traditional
seasonality in its business; that fourth quarter revenue will be in
the range of $18.0 million to $20.0 million; and that Kopin's balance
sheet, in the long term, will enable the Company to develop innovative
products and capitalize on emerging portable technologies. These
statements involve a number of risks and uncertainties that could
materially affect future results. Among these risk factors are general
economic and business conditions and growth in the flat panel display,
wireless, LED and gallium arsenide integrated circuit and materials
industries; the impact of competitive products and pricing;
availability of third-party components; the successful CyberLite
production ramp; the qualification of Kopin's CyberLite manufacturing
process by additional customers; availability of integrated circuit
fabrication facilities; cost and yields associated with production of
the Company's CyberDisplay imaging devices, CyberLite LEDs and HBT
transistor wafers; loss of significant customers; acceptance of the
Company's products; success of new product and other research and
development efforts; continuation of strategic relationships; the
value of shares of Micrel Semiconductor held by the Company; Kopin's
ability to accurately forecast revenue levels; and other risk factors
and cautionary statements listed in the Company's periodic reports and
registration statements filed with the Securities and Exchange
Commission. These include, but are not limited to, the Company's
Annual Report on Form 10-K for the year ended December 31, 2003 and
Quarterly Report on Form 10-Q for the period ended June 26, 2004.
CyberDisplay, CyberEVF, CyberLite, GAIN-HBT and The
NanoSemiconductor Company are trademarks of Kopin Corporation.
The Company's condensed consolidated statement of operations and
balance sheet are attached.
Kopin - The NanoSemiconductor Company(TM)
Kopin Corporation
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended Nine Months Ended
------------------------ ------------------------
Sept 25, Sept 27, Sept 25, Sept 27,
2004 2003 2004 2003
------------------------ ------------------------
Revenues:
Product
revenues $22,911,095 $17,213,912 $67,841,529 $54,730,946
Research and
development
revenues - 300,000 986,553 700,000
------------------------ ------------------------
22,911,095 17,513,912 68,828,082 55,430,946
Expenses:
Cost of product
revenues 17,833,237 14,764,386 56,758,136 44,662,098
Research and
development 3,542,350 3,294,887 10,965,079 9,098,567
Selling,
general and
administrative 2,679,540 2,373,777 8,434,760 8,004,755
Other 240,000 120,216 240,000 360,648
------------------------ ------------------------
24,295,127 20,553,266 76,397,975 62,126,068
------------------------ ------------------------
Loss from operations (1,384,032) (3,039,354) (7,569,893) (6,695,122)
Other income and
expense:
Interest and
other income 646,211 891,691 2,219,304 2,583,749
Interest and
other expense (258,613) (711,992) (1,056,709) (1,494,561)
------------------------ ------------------------
387,598 179,699 1,162,595 1,089,188
------------------------ ------------------------
Loss before minority
interest in income
of subsidiary (996,434) (2,859,655) (6,407,298) (5,605,934)
Minority interest in
income of
subsidiary (124,109) (166,588) (431,152) (658,056)
------------------------ ------------------------
Net loss $(1,120,543)$(3,026,243) $(6,838,450)$(6,263,990)
==================================================
Net loss per share:
Basic $(0.02) $(0.04) $(0.10) $(0.09)
======================== ========================
Diluted $(0.02) $(0.04) $(0.10) $(0.09)
======================== ========================
Weighted average
number of common
shares outstanding:
Basic 70,048,767 69,549,645 70,079,558 69,449,090
======================== ========================
Diluted 70,048,767 69,549,645 70,079,558 69,449,090
======================== ========================
Kopin Corporation
Condensed Consolidated Balance Sheets
(Unaudited)
Sept 25, December 31,
2004 2003
----------------------------
ASSETS
Current assets:
Cash and marketable securities $110,118,835 $120,333,188
Accounts receivable, net 10,502,434 6,771,391
Inventory 10,585,952 5,920,364
Prepaid and other assets 2,253,109 1,451,374
----------------------------
Total current assets 133,460,330 134,476,317
----------------------------
Equipment and improvements, net 24,945,126 31,008,403
Other assets 7,692,396 9,335,749
----------------------------
Total assets $166,097,852 $174,820,469
============================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $13,378,364 $14,365,686
Accrued expenses 1,861,938 2,224,928
Billings in excess of revenue earned 1,967,559 1,378,970
----------------------------
Total current liabilities 17,207,861 17,969,584
----------------------------
Minority interest 3,690,791 3,113,728
Stockholders' equity 145,199,200 153,737,157
----------------------------
Total liabilities and stockholders' equity $166,097,852 $174,820,469
============================
CONTACT: Kopin Corporation
Richard Sneider, 508-824-6696
Chief Financial Officer
rsneider@kopin.com
or
Sharon Merrill Associates, Inc.
Ehren Lister, 617-542-5300
Account Executive
elister@investorrelations.com