POET Technologies Inc. (“POET” or the “Company”) (TSX Venture: PTK;
NASDAQ: POET), the designer and developer of the POET Optical
Interposer™ and Photonic Integrated Circuits (PICs) for the data
center and tele-communication markets, today reported its audited
condensed consolidated financial results for the fourth quarter and
full year ended December 31, 2021. The Company’s financial results
as well as the Management’s Discussion and Analysis have been filed
on SEDAR and EDGAR. All financial figures are in United States
dollars (“USD”) unless otherwise indicated.
Fourth Quarter Financial (non-IFRS) and
Recent Business Highlights:
The Company continued to execute on its
strategic initiatives and achieved the following significant
milestones during the fourth quarter and the subsequent three
months:
- Secured a commitment from a leading
network systems company for a unique multi-engine design for 100G
CWDM4 and 100G LR4 Optical Engines based on the POET Optical
Interposer. The combined value of the NRE and the purchase order
for initial units exceeds US$1.2 million;
- Established the first phase of a
supply agreement with a leading global supplier of lasers and other
components used in high-speed optical networking equipment. The
companies will collaborate on the design and production of
flip-chippable Continuous Wave (CW) high power lasers for use in
the Company’s 400G optical engines;
- Completed previously announced
consolidation of its common shares and commenced trading on the
Nasdaq Capital Market on March 14, 2022;
- Entered development agreement and
received initial purchase order from Celestial AI to provide
multi-laser integrated external light source modules for AI
accelerator chips;
- Began collaboration on multi-phase,
co-development project with Liobate Technologies to incorporate
advanced Thin-Film Lithium Niobate (TFLN) modulators into the
Company’s optical engines, with a focus on commercializing POET’s
400/800Gps Transmit and Receive optical engines for data center and
telecom applications;
- Appointed seasoned optical industry
executive, Raju Kankipati, to newly established position of Vice
President of Product Line Management;
- Formally launched and began
sampling 400G FR4 and 800G (2x400G FR4) Receive (RX) optical
engines based on the POET Optical Interposer, representing the
industry’s only chip-scale integrated version of a FR4 RX optical
engine;
- Exhibited and demonstrated POET’s
unique chip-scale integrated FR4 optical engines, 200G FR4 Transmit
and 400G FR4 Receive, at the Optical Fiber Conference (OFC), in
addition to hosting meetings with numerous existing and prospective
customers;
- Joined new center for photonics
integration, the Singapore Hybrid-Integrated Next Generation
micro-Electronics (SHINE), as a founding member;
- Ended the fourth quarter with
robust balance sheet consisting primarily of cash, cash equivalents
and short-term investments of $21.3 million and no debt.
Management Comments
“During the fourth quarter and year-to-date, we
have successfully delivered an increasing number of fully
functional samples of POET’s optical engines to customers, which is
a key milestone in the commercialization of our technology after
more than four years of technology and product development,” stated
Dr. Suresh Venkatesan, Chairman & CEO. “I’m also pleased to
report that we are on track to deliver Beta samples to multiple
lead customers within the coming weeks. These latest Beta samples
meet or exceed the highest industry specifications, and they will
be undergoing standard reliability testing and qualifications by
customers over the next three to six months.”
“As a further highlight to our product sampling
milestones, the recent launch and live demonstration of our 200G
FR4 Transmit and 400G FR4 Receive optical engines at OFC was also a
watershed achievement. Enabled by our proprietary POET Optical
Interposer platform, we were the only company to exhibit a
chip-scale integrated FR4 optical engine, offering substantial
size, energy efficiency and cost benefits compared to alternative
solutions based on the DR4 standard. As a result of our
demonstrations and participation at OFC, we have gained increasing
awareness as well as notable traction on new engagements for our
standard products as well as potential custom designs across a
growing number of prospective customers. We expect to build on this
momentum over the course of 2022, as we continue to execute on our
product roadmap and expand sampling of our industry-leading
solutions based on the POET Optical Interposer platform toward
production releases later this year.”
Financial SummaryThe Company
reported a net loss of $3.7 million, or ($0.10) per share, in the
fourth quarter of 2021 compared to a net loss of $5.0 million, or
($0.17) per share, for the same period in 2020 and a net loss of
$3.5 million, or ($0.10) per share, in the third quarter of 2021.
The net loss in the fourth quarter of 2021 included research and
development costs of $2.0 million compared to $2.2 million for the
same period in 2020 and $1.2 million in the third quarter of 2021.
R&D for the Company varies from period to period as based on
the immediate product development needs of the Company. The
Company’s decreased spend in the fourth quarter of 2021 compared to
the fourth quarter of 2020 was driven by the current contraction in
the global semiconductor chip supply chain that has resulted in
slower deliveries of orders made by the Company. The increased
spend in the fourth quarter of 2021 compared to the third quarter
of 2021 was a result of certain NRE commitments with large tier-one
industry suppliers established to manage the Company’s supply chain
and associated risks.
Non-cash expenses in the fourth quarter of 2021
included stock-based compensation of $1.2 million and depreciation
and amortization of $0.3 million. Non-cash stock-based compensation
and depreciation and amortization in the same period of 2020 were
$0.9 million and $0.2 million, respectively. Third quarter 2021
stock-based compensation and depreciation and amortization were
$1.3 million and $0.3 million, respectively. The Company had debt
related finance costs of $16,000 in the fourth quarter of 2021
compared to $249,000 in the fourth quarter of 2020 and $20,000 in
the third quarter of 2021. All of the finance costs recognized in
the fourth quarter of 2021 were non-cash compared to $128,000
during the same period in 2020 and $18,000 in the third quarter of
2021. The Company recognized other income, including interest of
$27,000 in the fourth quarter of 2021 compared to $7,000 in the
same period in 2020 and $208,000 in the third quarter of 2021.
Other income, including interest in the third quarter of 2021
included $187,000 of COVID-19 related PPP loan that was
forgiven.
Impact of joint venture in the fourth quarter of
2021 was $1.0 million compared to nil in the same period of 2020
and $0.4 million in the third quarter of 2021. Impact of joint
venture is a net gain on the Company’s activity related to its
investment in SPX. During 2021, the Company recognized a gain of
$2.6 million related to its contribution of intellectual property
to SPX in accordance with IAS 28. The Company only recognized a
gain on the contribution of the intellectual property equivalent to
the SAIC’s interest in SPX. Additionally, the Company recognized
its share of SPX's losses using the equity method. The Company
recognized 94.2% or $1.1 million of the net operating loss of SPX
from March 12, 2021 to December 31, 2021. The Company's current
share of the operating loss is a result of the high value of the
Company's initial contribution.
On a non-IFRS basis, cash flow from operating
activities in the fourth quarter of 2021 was ($3.2) million
compared to ($2.9) million in the fourth quarter of 2020 and ($2.8)
million in the third quarter of 2021.
Non-IFRS Financial Performance
Measures
Certain financial information presented in this
press release is not prescribed by IFRS. These non-IFRS financial
performance measures are included because management has used the
information to analyze the business performance and financial
position of POET. These non-IFRS financial measures are intended to
provide additional information only and do not have any
standardized meaning under IFRS and may not be comparable to
similar measures presented by other companies. These non-IFRS
financial measures should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
IFRS.
POET TECHNOLOGIES
INC.PROFORMA – NON-IFRS PRESENTATION OF
OPERATIONS(All figures are in U.S. Dollars)
For the Quarter ended: |
|
31-Dec-21 |
|
30-Sep-21 |
|
30-Jun-21 |
|
31-Mar-21 |
|
31-Dec-20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
|
- |
|
- |
|
209,100 |
|
|
|
Research and development |
|
(2,010,793 |
) |
(1,231,676 |
) |
(1,812,924 |
) |
(1,339,784 |
) |
(2,229,672 |
) |
Depreciation and
amortization |
|
(281,178 |
) |
(296,424 |
) |
(270,189 |
) |
(252,731 |
) |
(242,385 |
) |
Professional fees |
|
(269,306 |
) |
(354,163 |
) |
(247,742 |
) |
(284,105 |
) |
(374,737 |
) |
Wages, benefits and management
fees |
|
(610,428 |
) |
(623,731 |
) |
(593,280 |
) |
(816,012 |
) |
(720,877 |
) |
Impact of joint venture |
|
1,022,417 |
|
422,834 |
|
- |
|
- |
|
- |
|
Stock-based compensation |
|
(1,181,375 |
) |
(1,295,864 |
) |
(1,236,593 |
) |
(820,538 |
) |
(893,664 |
) |
General expenses and rent |
|
(377,223 |
) |
(275,078 |
) |
(381,539 |
) |
(357,980 |
) |
(305,495 |
) |
Interest expense |
|
(15,512 |
) |
(19,729 |
) |
(94,799 |
) |
(234,579 |
) |
(248,823 |
) |
Other income, including
interest |
|
26,650 |
|
208,100 |
|
19,772 |
|
7,309 |
|
7,333 |
|
Net loss |
|
(3,696,748 |
) |
(3,465,731 |
) |
(4,408,194 |
) |
(4,098,420 |
) |
(5,008,320 |
) |
|
|
|
|
|
|
|
Net loss per share |
|
(0.10 |
) |
(0.10 |
) |
(0.13 |
) |
(0.13 |
) |
(0.17 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Business Update Conference Call
The Company will host a business update conference call tomorrow,
Wednesday, April 27, 2022, at 8:00 a.m. Pacific Time (11:00 a.m.
Eastern Time). A link to the live webcast and archived replay of
the business update conference call, as well as associated
presentation materials, can be found in the Investor Relations
section of POET’s website at www.poet-technologies.com.
Additionally, the live conference call can be accessed by dialing
1-866-688-4315 and using Conference ID 6948124. A telephone replay
of the call will also be made available approximately two hours
after the call and remain available through May 4, 2022. The
telephone replay can be accessed by dialing 1-855-859-2056 and
using the Conference ID 6948124.
About POET Technologies
Inc.POET Technologies is a design and development company
offering integration solutions based on the POET Optical
Interposer™ a novel platform that allows the seamless integration
of electronic and photonic devices into a single multi-chip module
using advanced wafer-level semiconductor manufacturing techniques
and packaging methods. POET’s Optical Interposer eliminates costly
components and labor-intensive assembly, alignment, burn-in and
testing methods employed in conventional photonics. The
cost-efficient integration scheme and scalability of the POET
Optical Interposer brings value to any device or system that
integrates electronics and photonics, including some of the highest
growth areas of computing, such as Artificial Intelligence (AI),
the Internet of Things (IoT), autonomous vehicles and high-speed
networking for cloud service providers and data centers. POET is
headquartered in Toronto, with operations in Allentown, PA,
Shenzhen, China and Singapore. More information may be obtained at
www.poet-technologies.com.
|
|
Shareholder Contact:Shelton GroupBrett L.
Perrysheltonir@sheltongroup.com |
Company Contact:Thomas R. Mika, EVP &
CFOtm@poet-technologies.com |
|
|
This news release contains “forward-looking
information” (within the meaning of applicable Canadian securities
laws) and “forward-looking statements” (within the meaning of the
U.S. Private Securities Litigation Reform Act of 1995). Such
statements or information are identified with words such as
“anticipate”, “believe”, “expect”, “plan”, “intend”, “potential”,
“estimate”, “propose”, “project”, “outlook”, “foresee” or similar
words suggesting future outcomes or statements regarding any
potential outcome. Such statements include the Company’s
expectations with respect to the success of the Company’s product
development efforts, the performance of its products, the expected
results of its operations, meeting revenue targets, and the
expectation of continued success in the financing efforts, the
capability, functionality, performance and cost of the Company’s
technology as well as the market acceptance, inclusion and timing
of the Company’s technology in current and future products.
Such forward-looking information or statements
are based on a number of risks, uncertainties and assumptions which
may cause actual results or other expectations to differ materially
from those anticipated and which may prove to be incorrect.
Assumptions have been made regarding, among other things,
management’s expectations regarding the success and timing for
completion of its development efforts, financing activities, future
growth, recruitment of personnel, opening of offices, the form and
potential of its joint venture, plans for and completion of
projects by the Company’s third-party consultants, contractors and
partners, availability of capital, and the necessity to incur
capital and other expenditures. Actual results could differ
materially due to a number of factors, including, without
limitation, the failure of its products to meet performance
requirements, lack of sales in its products, once released,
operational risks in the completion of the Company’s anticipated
projects, lack of performance of its joint venture, delays in
recruitment for its newly opened operations or changes in plans
with respect to the development of the Company’s anticipated
projects by third-parties, risks affecting the Company’s ability to
execute projects, the ability of the Company to generate sales for
its products, the ability to attract key personnel, and the ability
to raise additional capital. Although the Company believes that the
expectations reflected in the forward-looking information or
statements are reasonable, prospective investors in the Company’s
securities should not place undue reliance on forward-looking
statements because the Company can provide no assurance that such
expectations will prove to be correct. Forward-looking information
and statements contained in this news release are as of the date of
this news release and the Company assumes no obligation to update
or revise this forward-looking information and statements except as
required by law.
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
120 Eglinton Avenue, East, Suite 1107, Toronto, ON, M4P
1E2- Tel: 416-368-9411 - Fax: 416-322-5075
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