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10-Q - 10-Q - DYNASIL CORP OF AMERICAv386141_10q.htm
EX-31.1B - EXHIBIT 31.1B - DYNASIL CORP OF AMERICAv386141_ex31-1b.htm
EX-31.1A - EXHIBIT 31.1A - DYNASIL CORP OF AMERICAv386141_ex31-1a.htm
EX-10.1 - EXHIBIT 10.1 - DYNASIL CORP OF AMERICAv386141_ex10-1.htm
EX-32.1 - EXHIBIT 32.1 - DYNASIL CORP OF AMERICAv386141_ex32-1.htm


Exhibit 99.1




Patty Kehe
Corporate Secretary
Dynasil Corporation of America
Phone: (617) 668-6855


Dynasil Corporation of America Reports
Third Quarter Fiscal 2014 Financial Results


Company Reports Third Consecutive Quarter of Profitability


Watertown, MA, August 13, 2014 – Dynasil Corporation of America (NASDAQ: DYSL), a developer and manufacturer of optics and photonics products, optical detection and analysis technology and components for the homeland security, medical and industrial markets, today announced financial results for the fiscal 2014 third quarter ended June 30, 2014.


Dynasil reported net income attributable to common stockholders for the quarter of approximately $100,000 compared with a net loss of ($400,000), for the quarter ended June 30, 2013. Net income for the nine months ended June 30, 2014 is $1.8 million, or $0.12 per share, as compared to a net loss of ($8.0 million), or ($0.54) per share, for the comparable period in 2013.


“In addition to being our third consecutive quarter of profitability, we believe that Dynasil continued to take positive steps toward our future,” said Dynasil Chairman and Interim CEO Peter Sulick. “These steps included our new revolving line of credit with Middlesex Savings Bank, our renewed compliance with the terms of our subordinated loan from Massachusetts Capital Resource Company and the acquisition of the assets of DichroTec Thin Films, LLC which added substantial capacity to EMF, our specialized coatings business.”


Net revenue for the third quarter of fiscal 2014 decreased to $10.6 million, from $11.3 million in the third quarter of fiscal 2013. In this quarter, the Optics segment’s revenues increased approximately $1.3 million, or 33% over the same period in the prior year. This increase was offset by a $1.5 million decrease in revenues from the now divested lead paint and medical products businesses which were sold during the first quarter of 2014 and by an approximate $400,000 decrease in Contract Research revenues, caused by a general slowdown in the timing of award grants and award funding.


Operating expenses for the three months ended June 30, 2014 were $3.8 million, a decrease of $1.2 million compared to the same period in 2013. The decrease in total operating expenses is primarily a result of the sale of the lead paint and medical products businesses in the Instruments segment. In addition, the Contract Research segment has reduced its operating expenses to better align with its lower revenue level.




As a result, operating income for the quarter ended June 30, 2014, increased to approximately $200,000 from a loss of ($200,000) in the quarter ended June 30, 2013.


“We are pleased that the operating income in each of Dynasil’s four business segments improved in the third quarter of 2014, as compared to the same period in 2013,” stated Mr. Sulick. “We are also happy to report that our Biomedical segment’s joint venture with Mayo Clinic, Xcede Technologies, has raised an additional $400,000 from note holders to further fund its research efforts in tissue sealant technology.”


Financial Results Webcast Information


Dynasil Corporation will host a webcast for investors and analysts at 5:00 p,m. ET on Wednesday, August 20,2014. The webcast will be hosted by Chairman and Interim CEO and President Peter Sulick and Chief Financial Officer Thomas Leonard. Those who wish to listen to the webcast can register via the Webcast link, visit the Investor Relations section of the Company's website at or also dial (877) 870-4263. Please ask to be joined into the Dynasil Corporation of America webcast. For interested individuals unable to join the live conference call, a webcast replay will be available on the Company's website for one year.


About Dynasil


Dynasil Corporation of America (NASDAQ: DYSL) develops and manufactures optical detection and analysis technology and components for the homeland security, medical and industrial markets. Combining world-class expertise in research and materials science with extensive experience in manufacturing and product development, Dynasil is commercializing products including dual-mode radiation detection solutions for Homeland Security and commercial applications and sensors for non-destructive testing.  Dynasil has an impressive and growing portfolio of issued and pending U.S. patents.  The Company is based in Watertown, Massachusetts, with additional operations in Mass., Minn., NY, NJ and the United Kingdom. More information about the Company is available at


Forward-looking Statements


The statements contained in this Quarterly Report on Form 10 Q which are not historical facts, are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements regarding future events and our future results are based on current expectations, estimates, forecasts, and projections and the beliefs and assumptions of our management, including, without limitation, our expectations regarding results of operations, our compliance with the financial covenants under our loan agreements with Middlesex Savings Bank and Massachusetts Capital Resource Company, Xcede obtaining financing from outside investors, the commercialization of our products including our dual mode detectors, our development of new technologies including at Dynasil Biomedical, uncertainty of the impact of the DichroTec acquisition, our ability to remediate the material weaknesses in our internal control over financial reporting, the adequacy of our current financing sources to fund our current operations, our growth initiatives, our capital expenditures and the strength of our intellectual property portfolio. These forward-looking statements may be identified by the use of words such as “plans,” “intends,” “may,” “could,” “expect,” “estimate,” “anticipate,” “continue” or similar terms, though not all forward-looking statements contain such words. The actual results of the future events described in such forward looking statements could differ materially from those stated in such forward looking statements due to a number of important factors. These factors that could cause actual results to differ from those anticipated or predicted include, without limitation, our ability to comply with the financial covenants under our outstanding indebtedness, our ability to develop and commercialize our products, including obtaining regulatory approvals, the size and growth of the potential markets for our products and our ability to serve those markets, the rate and degree of market acceptance of any of our products, our ability to address our material weaknesses in our internal controls, general economic conditions, costs and availability of raw materials and management information systems, our ability to obtain and maintain intellectual property protection for our products, competition, the loss of key management and technical personnel, our ability to obtain timely payment of our invoices to governmental customers, litigation, the effect of governmental regulatory developments, the availability of financing sources, our ability to identify and execute on acquisition opportunities and integrate such acquisitions into our business, and seasonality, as well as the uncertainties set forth in the Company’s Annual Report on Form 10 K, filed on December 20, 2013, including the risk factors contained in Item 1a, and from time to time in the Company's other filings with the Securities and Exchange Commission. The Company disclaims any intention or obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.




Dynasil Corporation of America and Subsidiaries

Consolidated Balance Sheet



   June 30, 2014   September 30, 2013 
Current Assets          
Cash and cash equivalents  $3,085,154   $2,436,828 
Accounts receivable, net   3,282,400    3,657,320 
Costs in excess of billings and unbilled receivables   1,468,741    1,537,318 
Inventories, net of reserves   2,941,358    3,140,244 
Prepaid expenses and other current assets   1,393,411    1,291,942 
Total current assets   12,171,064    12,063,652 
Property, Plant and Equipment, net   6,592,839    4,773,779 
Other Assets          
Intangibles, net   1,333,513    3,484,583 
Goodwill   6,332,396    6,240,983 
Deferred financing costs, net   41,804    114,229 
Total other assets   7,707,713    9,839,795 
Total Assets  $26,471,616   $26,677,226 
Current Liabilities          
Current portion of long-term debt  $2,437,742   $9,819,048 
Capital lease obligations, current   128,979    124,383 
Accounts payable   2,230,015    2,056,262 
Deferred revenue   127,445    515,790 
Accrued expenses and other liabilities   2,652,362    2,846,850 
Total current liabilities   7,576,543    15,362,333 
Long-term Liabilities          
Long-term debt, net of current portion   3,254,443    - 
Capital lease obligations, net of current portion   131,269    232,173 
Convertible notes   810,413    - 
Pension liability   249,966    249,966 
Deferred tax liability   179,369    186,866 
Total long-term liabilities   4,625,460    669,005 
Stockholders' Equity          
Dynasil stockholders' equity   14,316,159    10,645,888 
Noncontrolling interest   (46,546)   - 
Total stockholders' equity   14,269,613    10,645,888 
Total Liabilities and Stockholders' Equity  $26,471,616   $26,677,226 




Dynasil Corporation of America and Subsidiaries

Consolidated Statement of Operations and Comprehensive Income (Loss)



   Three Months Ended   Nine Months Ended 
   June 30,   June 30, 
   2014   2013   2014   2013 
Net revenue  $10,640,527   $11,322,342   $31,758,512   $32,360,147 
Cost of revenue   6,732,880    6,622,392    19,041,451    18,512,430 
Gross profit   3,907,647    4,699,950    12,717,061    13,847,717 
Operating expenses:                    
Sales and marketing   337,033    418,318    1,046,567    1,384,739 
Research and development   300,296    499,732    1,024,873    1,710,090 
General and administrative   3,144,132    3,997,407    9,624,678    11,644,624 
Impairment of goodwill and long-lived assets   -    -    -    6,763,072 
Total operating expenses   3,781,461    4,915,457    11,696,118    21,502,525 
Gain on sale of assets   30,000    -    1,216,686    - 
Income (loss) from operations   156,186    (215,507)   2,237,629    (7,654,808)
Interest expense, net   145,797    181,773    567,904    545,690 
Income (loss) before taxes   10,389    (397,280)   1,669,725    (8,200,498)
Income tax (credit) provision   (47,719)   (30,920)   (87,160)   (213,065)
Net income (loss)   58,108    (366,360)   1,756,885    (7,987,433)
Less: Net loss attributable to noncontrolling interest   (16,059)   -    (46,546)   - 
Net income (loss) attributable to common stockholders  $74,167   $(366,360)  $1,803,431   $(7,987,433)
Net income (loss)  $58,108   $(366,360)  $1,756,885   $(7,987,433)
Other comprehensive income (loss):                    
Foreign currency translation   141,948    (45)   214,957    (245,666)
Total comprehensive income (loss)  $200,056   $(366,405)  $1,971,842   $(8,233,099)
Basic net income (loss) per common share  $0.00   $(0.02)  $0.12   $(0.54)
Diluted net income (loss) per common share  $0.00   $(0.02)  $0.12   $(0.54)
Weighted average shares outstanding                    
Basic   15,280,607    14,859,899    15,134,377    14,767,401 
Diluted   15,299,422    14,859,899    15,145,639    14,767,401