Spire Corp. (SPIR, Financial) filed Quarterly Report for the period ended 2009-03-31.
Spire Corp. develops manufactures and markets highly-engineered photovoltaic module manufacturing equipment and provides biomedical processing services. Spire is the world's leader in the design and manufacture of specialized equipment for the production of terrestrial photovoltaic modules from solar cells with its equipment installed. Spire's value-added biomedical processing services offer surface treatments to enhance the durability or antimicrobial characteristics of orthopedic and other medical devices. Spire Corp. has a market cap of $56.3 million; its shares were traded at around $6.76 with and P/S ratio of 0.9. Spire Corp. had an annual average earning growth of 1.7% over the past 5 years.
Cost of sales and revenues 88 75
- -
Gross profit 12 25
Selling, general and administrative expenses (33) (26)
Internal research and development expenses (2) (1)
Gain on termination of contract 12 -
- -
Loss from operations (11) (2)
Other loss, net (1) (2)
- -
Loss before income tax provision (12) (4)
Income tax provision - -
- -
Net loss (12%) (4%)
= =
The 19% decrease in contract research, services and license revenues for
the three months ended March 31, 2009 as compared to the three months ended
March 31, 2008 is primarily attributable to a decrease in optoelectronics,
royalties and research and development activities, partially offset by
orthopedics service revenue. Revenue from our optoelectronics processing
services (Spire Semiconductor) decreased 54% in 2009 compared to 2008 as a
result of an overall decrease in optoelectronics activities attributable to a
further deepening of the current global economic recession and to a lesser
extent the termination of a contract with Principia Lightworks, Inc. in March
2009 (see Gain on Termination of Contact). Revenue from royalties decreased 100%
as a result of the termination of contract with Nisshinbo Industries, Inc. in
November. Revenues from our research and development activities decreased 31% in
2009 as compared to 2008 primarily due to a decrease in the number and value of
contracts associated with funded research and development. Revenues from our
orthopedic activities increased 29% in 2009 as compared to 2008. This increase
is primarily the result of revenue from a new customer added in the third
quarter of 2008.
Three Months Ended March 31, Increase/(Decrease)
- -
(in thousands) 2009 % 2008 % $ %
- - - - - -
Cost of goods sold $ 8,677 92% $ 8,494 77% $183 2%
Cost of contract research,
services and licenses 2,164 76% 2,374 67% (210) (9%)
- - -
Net cost of sales and revenues $10,841 88% $10,868 75% $(27) 0%
= = =
Selling, general and administrative $ 4,045 33% $ 3,778 26% $267 7%
Internal research and development 311 2% 111 1% 200 180%
- - -
Operating expenses $ 4,356 35% $ 3,889 27% $467 12%
= = =
On March 31, 2008, we entered into a second Loan and Security Agreement
(the "Revolving Credit Facility") with the Bank. Under the terms of the
Revolving Credit Facility, the Bank agreed to provide us with a credit line up
to $5.0 million. Our obligations under the Equipment Credit Facility are secured
by substantially all of our assets and advances under the Revolving Credit
Facility are limited to 80% of eligible receivables and the lesser of 25% of the
value of our eligible inventory, as defined, or $2.5 million if the inventory is
backed by a customer letter of credit. Interest on outstanding borrowings
accrues at a rate per annum equal to the greater of Prime Rate plus one percent
(1.0%) or seven percent (7.0%). In addition, we agreed to pay to the Bank a
collateral monitoring fee of $750 per month in the event we are in default of
our covenants and agreed to the following additional terms: (i) $50 thousand
commitment fee; (ii) an unused line fee in the amount of 0.75% per annum of the
average unused portion of the revolving line; and (iii) an early termination fee
of 0.5% of the total credit line if we terminate the Revolving Credit Facility
prior to 12 months from the Revolving Credit Facility's effective date. In
addition, on March 31, 2008 our existing Equipment Credit Facility was amended
whereby the Bank granted a waiver for our defaults for not meeting our December
31, 2007 quarter liquidity and profit covenants and for not meeting our January
and February 2008 liquidity covenants. Further, the covenants were amended to
match the covenants, as discussed below, contained in the Revolving Credit
Facility. Our interest rate under the Equipment Credit Facility was also
modified from Bank Prime plus one half percent (0.5%) to the greater of Bank
Prime plus one percent (1.0%) or seven percent (7.0%).
On May 13, 2008, the Bank amended the Equipment Credit Facility and the
Revolving Credit Facility, modifying our net income profitability covenant
requirements in exchange for a three quarters percent (0.75%) increase in our
interest rate (7.75% at March 31, 2009) and waiver restructuring fee equal to
one half percent (0.5%) of amounts outstanding under the Equipment Credit
Facility and committed under the Revolving Credit Facility. Interest on
outstanding borrowings accrues at a rate per annum equal to the greater of Prime
Rate plus one percent (1.0%) or seven percent (7.0%). In addition, our term loan
balance will be factored in when calculating our borrowing base under the
Revolving Credit Facility.
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Spire Corp. develops manufactures and markets highly-engineered photovoltaic module manufacturing equipment and provides biomedical processing services. Spire is the world's leader in the design and manufacture of specialized equipment for the production of terrestrial photovoltaic modules from solar cells with its equipment installed. Spire's value-added biomedical processing services offer surface treatments to enhance the durability or antimicrobial characteristics of orthopedic and other medical devices. Spire Corp. has a market cap of $56.3 million; its shares were traded at around $6.76 with and P/S ratio of 0.9. Spire Corp. had an annual average earning growth of 1.7% over the past 5 years.
Highlight of Business Operations:
Net sales and revenues 100% 100%Cost of sales and revenues 88 75
- -
Gross profit 12 25
Selling, general and administrative expenses (33) (26)
Internal research and development expenses (2) (1)
Gain on termination of contract 12 -
- -
Loss from operations (11) (2)
Other loss, net (1) (2)
- -
Loss before income tax provision (12) (4)
Income tax provision - -
- -
Net loss (12%) (4%)
= =
The 19% decrease in contract research, services and license revenues for
the three months ended March 31, 2009 as compared to the three months ended
March 31, 2008 is primarily attributable to a decrease in optoelectronics,
royalties and research and development activities, partially offset by
orthopedics service revenue. Revenue from our optoelectronics processing
services (Spire Semiconductor) decreased 54% in 2009 compared to 2008 as a
result of an overall decrease in optoelectronics activities attributable to a
further deepening of the current global economic recession and to a lesser
extent the termination of a contract with Principia Lightworks, Inc. in March
2009 (see Gain on Termination of Contact). Revenue from royalties decreased 100%
as a result of the termination of contract with Nisshinbo Industries, Inc. in
November. Revenues from our research and development activities decreased 31% in
2009 as compared to 2008 primarily due to a decrease in the number and value of
contracts associated with funded research and development. Revenues from our
orthopedic activities increased 29% in 2009 as compared to 2008. This increase
is primarily the result of revenue from a new customer added in the third
quarter of 2008.
Three Months Ended March 31, Increase/(Decrease)
- -
(in thousands) 2009 % 2008 % $ %
- - - - - -
Cost of goods sold $ 8,677 92% $ 8,494 77% $183 2%
Cost of contract research,
services and licenses 2,164 76% 2,374 67% (210) (9%)
- - -
Net cost of sales and revenues $10,841 88% $10,868 75% $(27) 0%
= = =
Selling, general and administrative $ 4,045 33% $ 3,778 26% $267 7%
Internal research and development 311 2% 111 1% 200 180%
- - -
Operating expenses $ 4,356 35% $ 3,889 27% $467 12%
= = =
On March 31, 2008, we entered into a second Loan and Security Agreement
(the "Revolving Credit Facility") with the Bank. Under the terms of the
Revolving Credit Facility, the Bank agreed to provide us with a credit line up
to $5.0 million. Our obligations under the Equipment Credit Facility are secured
by substantially all of our assets and advances under the Revolving Credit
Facility are limited to 80% of eligible receivables and the lesser of 25% of the
value of our eligible inventory, as defined, or $2.5 million if the inventory is
backed by a customer letter of credit. Interest on outstanding borrowings
accrues at a rate per annum equal to the greater of Prime Rate plus one percent
(1.0%) or seven percent (7.0%). In addition, we agreed to pay to the Bank a
collateral monitoring fee of $750 per month in the event we are in default of
our covenants and agreed to the following additional terms: (i) $50 thousand
commitment fee; (ii) an unused line fee in the amount of 0.75% per annum of the
average unused portion of the revolving line; and (iii) an early termination fee
of 0.5% of the total credit line if we terminate the Revolving Credit Facility
prior to 12 months from the Revolving Credit Facility's effective date. In
addition, on March 31, 2008 our existing Equipment Credit Facility was amended
whereby the Bank granted a waiver for our defaults for not meeting our December
31, 2007 quarter liquidity and profit covenants and for not meeting our January
and February 2008 liquidity covenants. Further, the covenants were amended to
match the covenants, as discussed below, contained in the Revolving Credit
Facility. Our interest rate under the Equipment Credit Facility was also
modified from Bank Prime plus one half percent (0.5%) to the greater of Bank
Prime plus one percent (1.0%) or seven percent (7.0%).
On May 13, 2008, the Bank amended the Equipment Credit Facility and the
Revolving Credit Facility, modifying our net income profitability covenant
requirements in exchange for a three quarters percent (0.75%) increase in our
interest rate (7.75% at March 31, 2009) and waiver restructuring fee equal to
one half percent (0.5%) of amounts outstanding under the Equipment Credit
Facility and committed under the Revolving Credit Facility. Interest on
outstanding borrowings accrues at a rate per annum equal to the greater of Prime
Rate plus one percent (1.0%) or seven percent (7.0%). In addition, our term loan
balance will be factored in when calculating our borrowing base under the
Revolving Credit Facility.
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