Research Frontiers Reports Third Quarter 2016 Financial Results
Management to Host Conference Call Today at 4:30 p.m.
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WOODBURY, NY -- (Marketwired) -- 11/03/16 --
Research Frontiers Inc. (NASDAQ: REFR) reported its financial results for its third quarter ended September 30, 2016. Management will host a conference call today at 4:30 p.m. Eastern Time to discuss its financial and operating results as well as recent developments.
- Who: Joseph M. Harary, President & CEO, Seth Van Voorhees, CFO
- Date/Time: Thursday, November 3, 2016, 4:30PM ET
- Dial-in Information: 1-412-717-9591
- Replay: Available on Thursday, November 3, 2016 for 90 days at www.SmartGlass-IR.com
Key Third Quarter 2016 Comments:
The Company continues to generate the majority of its revenues from the automotive market, and fee income from both of the Company's main automotive licensees were up in the third quarter of 2016 as compared to the second quarter. These results were in line with guidance previously given by the Company during the last several conference calls identifying the expectation that fee income from the automotive market would be higher in the third quarter than in the second quarter of 2016, and that the fourth quarter of 2016 would be even stronger than the third quarter.
Overall, fee income from licensing activities for the nine months ended September 30, 2016 decreased to $958,337 from $1,628,736 for the nine months ended September 30, 2015.
- A substantial majority of this decrease during the nine months ending September 30, 2016 was the result of non-recurring fees earned last year associated with the Company's participation in the Milan Expo, and non - recurring fee income under several licenses in 2015.
- To a much lesser extent, fee income from automobiles and aircraft using the Company's technology was lower during the first nine months of 2016 due to: (1) lower production levels of certain car models in the period; (2) lower costs to the OEM (and therefore lower royalties per car to the Company) for glass incorporating the Company's technology on certain car models, and (3) a design improvement in certain aircraft that caused a short-term reduction in new window installations.
- As noted above, these lower automotive sales levels reversed themselves with improvement in the third quarter compared to the second quarter of 2016, with this improving trend expected to continue in the fourth quarter of 2016.
- Lower sales levels in the aircraft industry were due to an overall design change in several aircraft which the Company's technology is being used on. Revenues from these aircraft are expected to be higher beginning with the fourth quarter of 2016 since these design improvements have been completed and fully implemented, and production of aircraft with these new improvements has resumed.
- Production efficiencies are expected to continue and accelerate with the introduction of the higher vehicle production volumes for various car models going forward, and the Company expects that lower pricing per square foot of the Company's technology could expand the market opportunities, adoption rates, and revenues for its technology in automotive and non- automotive applications.
- The Company expects to generate additional royalty income from the near-term introduction of additional new car and aircraft models from other OEMS (original equipment manufacturers), and from continued growth of sales of products using the Company's technology in markets outside of automotive and aircraft applications.
Research Frontiers is the developer of SPD-Smart light-control technology which allows users to instantly, precisely and uniformly control the shading of glass or plastic, either manually or automatically. Research Frontiers has built an infrastructure of over 40 licensed companies that collectively are capable of serving the growing global demand for smart glass products in automobiles, homes, buildings, museums, aircraft and boats. For more information, please visit our website at www.SmartGlass.com, and on Facebook, Twitter, LinkedIn and YouTube.
Note: From time to time Research Frontiers may issue forward-looking statements which involve risks and uncertainties. This press release contains forward-looking statements. Actual results could differ and are not guaranteed. Any forward-looking statements should be considered accordingly. "SPD-Smart" and "SPD-SmartGlass" are trademarks of Research Frontiers Inc.
RESEARCH FRONTIERS INCORPORATED
Consolidated Balance Sheets
September 30 December 31
2016 2015
Assets (Unaudited)
---------------------------------------------- ------------- -------------
Current assets:
Cash and cash equivalents $ 2,988,662 $ 5,712,310
Short-term investments 1,520,620 1,513,784
Royalty receivables, net of reserves of
$629,457 in 2016 and 2015 1,535,570 1,314,675
Prepaid expenses and other current assets 63,695 133,465
------------- -------------
Total current assets 6,108,547 8,674,234
------------- -------------
Fixed assets, net 695,014 836,216
Deposits and other assets 33,567 33,567
------------- -------------
Total assets $ 6,837,128 $ 9,544,017
============= =============
Liabilities and Shareholders' Equity
----------------------------------------------
Current liabilities:
Accounts payable $ 32,114 $ 46,734
Accrued expenses and other 572,391 421,478
Deferred revenue 10,000 -
------------- -------------
Total current liabilities 614,505 468,212
------------- -------------
Shareholders' equity:
Common stock, par value $0.0001 per share;
authorized 100,000,000 shares, issued and
outstanding24,043,846 shares for 2016 and
2015 2,404 2,404
Additional paid-in capital 111,483,959 111,483,959
Accumulated deficit (105,263,740) (102,410,558)
------------- -------------
Total shareholders' equity 6,222,623 9,075,805
------------- -------------
Total liabilities and shareholders' equity $ 6,837,128 $ 9,544,017
============= =============
RESEARCH FRONTIERS INCORPORATED
Consolidated Statements of Operations
(Unaudited)
Nine months ended Three months ended
---------------------------- ----------------------------
September 30, September 30, September 30, September 30,
2016 2015 2016 2015
------------- ------------- ------------- -------------
Fee income $ 958,337 $ 1,628,736 $ 304,772 $ 445,846
------------- ------------- ------------- -------------
Operating
expenses 2,676,178 3,029,386 624,080 895,123
Research and
development 1,160,544 1,096,420 246,755 327,448
------------- ------------- ------------- -------------
Total Expenses 3,836,722 4,125,806 870,835 1,222,571
------------- ------------- ------------- -------------
Operating loss (2,878,385) (2,497,070) (566,063) (776,725)
Net investment
income 25,203 32,085 6,332 9,405
------------- ------------- ------------- -------------
Net loss $ (2,853,182) $ (2,464,985) $ (559,731) $ (767,320)
============= ============= ============= =============
Basic and
diluted net
loss per common
share $ (0.12) $ (0.10) $ (0.02) $ (0.03)
============= ============= ============= =============
Weighted average
number of
common shares
outstanding 24,043,846 24,037,042 24,043,846 23,996,038
============= ============= ============= =============
RESEARCH FRONTIERS INCORPORATED
Consolidated Statements of Cash Flows
(Unaudited)
Nine months ended
--------------------------------------
September 30, 2016 September 30, 2015
------------------ ------------------
Cash flows from operating
activities:
Net loss $ (2,853,182) $ (2,464,985)
Adjustments to reconcile net loss to
net cash used in operating
activities:
Depreciation and amortization 141,481 91,949
Stock-based compensation - 183,897
Loss on sale of asset 1,776 -
Change in assets and liabilities:
Royalty receivables (220,895) (592,254)
Prepaid expenses and other
current assets 69,770 44,002
Deferred revenue 10,000 10,000
Accounts payable and accrued
expenses 136,293 (130,379)
------------------ ------------------
Net cash used in operating
activities (2,714,757) (2,857,770)
------------------ ------------------
Cash flows from investing
activities:
Purchases of fixed assets (8,055) (312,943)
Proceeds from sale of fixed asset 6,000 -
Change in investments (6,836) 1,493,888
------------------ ------------------
Net cash provided by (used in)
investing activities (8,891) 1,180,945
------------------ ------------------
Cash flows from financing
activities:
Net proceeds from sale of common
stock - -
Net proceeds from exercise of
options and warrants - 535,123
------------------ ------------------
Net cash provided by financing
activities - 535,123
------------------ ------------------
Net decrease in cash and cash
equivalents (2,723,648) (1,141,702)
Cash and cash equivalents at
beginning of year 5,712,310 7,569,537
------------------ ------------------
Cash and cash equivalents at end of
period $ 2,988,662 $ 6,427,835
================== ==================
CONTACT:Seth L. Van VoorheesChief Financial OfficerResearch Frontiers [email protected]
Source: Research Frontiers Inc.
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