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| 8-K - CURRENT REPORT - Nano Magic Holdings Inc. | form8k.htm |
PEN Inc. Announces Third Quarter Financial Results
Investor Conference Call and Business Update Set for November 25, 10 am ET
DEERFIELD BEACH, FL--(Marketwired - November 17, 2014) - PEN Inc. (OTCQB: PENC) (PEN) reported Friday the financial results for the quarter ended September 30, 2014.
Scott Rickert, PEN’s Chairman and CEO, said, “The historical business of PEN, primarily the sales of our eye care glass cleaning and defogging business, remains strong. We have restructured the contract research business to make it a break-even business going forward and thus PEN overall is profitable. This result after only one month of combined operations for the quarter reflects the hard work and dedication of the entire PEN team. Our focus is on continuing the growth of our historical businesses and the coming roll-out of new products. Our goal remains to create strong growth via new nanotechnology-enhanced products.”
For the three quarters ended September 30, PEN profits were $41,073 versus a net loss for the same period of 2013 of $168,950. Excluding one-time costs of approximately $235,000 associated with the Combination of Applied Nanotech and Nanofilm, PEN had pro forma net income for the nine month period of approximately $329,000.
For the quarter ended September 30, 2014, the Company reported a net loss of $448,887 versus a profit of $26,321 for the same period of 2013. The results reflect the merger acquisition costs, as well as the losses from the research and development segment. Since the combination, PEN has made efforts to cut costs and plans to achieve positive or break-even cash flow from operations in that segment by the end of 2014. For the nine month period, sales increased by $890,101 or 13.3% as compared to the same period in 2013.
Substantially all of PEN’s results of operations for the third quarter and year to date relate to the Nanofilm product segment since Nanofilm was the acquiror for accounting purposes, and the results of operations related to the research and development segment based in the Applied Nanotech Inc. subsidiary acquired in the combination are included in the results of operations only for the period from August 27, 2014, (the effective date of the combination) to September 30, 2014.
The entire Form 10Q and related financial statements are available at www.sec.gov, or the company’s website, www.pen-technology.com.
Investor call and business update: Tuesday, November 25, 2014. At 10 a.m.
PEN will host an investor call Tuesday, November 25 at 10 a.m. ET to discuss third quarter results, provide a business update and take questions from investors. Participants can register for the webcast at this address:
http://w.on24.com/r.htm?e=896132&s=1&k=539B926244C74972BC1708A6B77EB90B.
The live event can also be followed on Twitter with the hashtag #PENRickert. Questions for the event may be submitted in advance to Lynn Lilly, Director of Communication, at llilly@pen-technology.com, or by tweeting them via direct Twitter message to @PENRickert or with the hashtag #PENRickert.
PEN, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
| September 30, 2014 | December 31, 2013 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash | $ | 254,429 | $ | 100,367 | ||||
| Accounts receivable, net | 1,089,697 | 1,524,303 | ||||||
| Accounts receivable - related party | 9,112 | 17,224 | ||||||
| Inventory | 1,255,890 | 1,484,456 | ||||||
| Prepaid expenses and other current assets | 426,588 | 107,718 | ||||||
| Total Current Assets | 3,035,716 | 3,234,068 | ||||||
| OTHER ASSETS: | ||||||||
| Property, plant and equipment, net | 803,276 | 672,704 | ||||||
| Intangible assets, net | 2,387,198 | - | ||||||
| Other assets | 37,197 | 73,504 | ||||||
| Total Other Assets | 3,227,671 | 746,208 | ||||||
| TOTAL ASSETS | $ | 6,263,387 | $ | 3,980,276 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Bank revolving line of credit | $ | - | $ | 199,919 | ||||
| Current portion of bank term loan | - | 60,000 | ||||||
| Convertible notes payable, net | 66,666 | - | ||||||
| Convertible notes payable - related parties, net | 80,001 | - | ||||||
| Accounts payable | 1,424,102 | 721,860 | ||||||
| Accrued expenses | 1,077,572 | 344,271 | ||||||
| Income taxes payable | 50,000 | - | ||||||
| Deferred revenue | 120,871 | - | ||||||
| Total Current Liabilities | 2,819,212 | 1,326,050 | ||||||
| LONG-TERM LIABILITIES: | ||||||||
| Bank term loan, net of current portion | - | 515,000 | ||||||
| Other long-term liabilities | - | 127,914 | ||||||
| Total Long-term Liabilities | - | 642,914 | ||||||
| Total Liabilities | 2,819,212 | 1,968,964 | ||||||
| STOCKHOLDERS’ EQUITY: | ||||||||
| Preferred stock, $.0001 par value, 20,000,000 shares authorized; No shares issued and outstanding | - | - | ||||||
| Class A common stock: $.0001 par value, 1,300,000,000 shares authorized; 232,316,856 and 27,670,187 issued and outstanding at September 30, 2014 and December 31, 2013, respectively | 23,232 | 2,767 | ||||||
| Class B common stock: $.0001 par value, 400,000,000 shares authorized; 250,731,549 and 250,698,105 issued and outstanding at September 30, 2014 and December 31, 2013, respectively | 25,073 | 25,070 | ||||||
| Class Z common stock: $.0001 par value, 100,000,000 shares authorized; 47,273,470 and 47,273,470 issued and outstanding at September 30, 2014 and December 31, 2013, respectively | 4,727 | 4,727 | ||||||
| Additional paid-in capital | 4,454,735 | 3,083,413 | ||||||
| Accumulated deficit | (1,063,592 | ) | (1,104,665 | ) | ||||
| Total Stockholders’ Equity | 3,444,175 | 2,011,312 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 6,263,387 | $ | 3,980,276 | ||||
See 10Q for accompanying notes to unaudited consolidated financial statements.
PEN, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| SALES: | ||||||||||||||||
| Third parties | $ | 1,913,911 | $ | 2,391,073 | $ | 7,446,232 | $ | 6,529,367 | ||||||||
| Related party | 40,810 | 44,353 | 147,862 | 174,626 | ||||||||||||
| Total Sales | 1,954,721 | 2,435,426 | 7,594,094 | 6,703,993 | ||||||||||||
| COST OF SALES | 1,340,759 | 1,524,087 | 4,172,427 | 4,148,487 | ||||||||||||
| GROSS PROFIT | 613,962 | 911,339 | 3,421,667 | 2,555,506 | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||||||
| Selling and marketing expenses | 42,033 | 57,878 | 186,062 | 201,108 | ||||||||||||
| Salaries, wages and contract labor | 574,213 | 313,733 | 1,448,933 | 961,106 | ||||||||||||
| Research and development | 131,371 | 267,135 | 426,740 | 727,021 | ||||||||||||
| Professional fees | 249,503 | 81,998 | 568,225 | 272,511 | ||||||||||||
| General and administrative expenses | 265,563 | 175,094 | 622,085 | 557,064 | ||||||||||||
| Total Operating Expenses | 1,262,683 | 895,838 | 3,252,045 | 2,718,810 | ||||||||||||
| INCOME (LOSS) FROM OPERATIONS | (648,721 | ) | 15,501 | 169,622 | (163,304 | ) | ||||||||||
| OTHER INCOME (EXPENSES): | ||||||||||||||||
| Interest income | - | 6 | - | 35 | ||||||||||||
| Interest expenses | (1,806 | ) | (15,521 | ) | (19,230 | ) | (72,051 | ) | ||||||||
| Other income, net | 12,124 | 30,813 | - | 37,678 | ||||||||||||
| Total Other Income/(Expense) | 10,318 | 15,298 | (19,230 | ) | (34,338 | ) | ||||||||||
| Income (loss) before income taxes | (638,403 | ) | 30,799 | 150,392 | (197,642 | ) | ||||||||||
| Income tax benefit (expense) | 159,726 | - | (55,901 | ) | - | |||||||||||
| NET INCOME (LOSS) | (478,677 | ) | 30,799 | 94,491 | (197,642 | ) | ||||||||||
| Net (income) loss attributable to former non-controlling interest | 29,790 | (4,478 | ) | (53,418 | ) | 28,692 | ||||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO PEN, INC. | $ | (448,887 | ) | $ | 26,321 | $ | 41,073 | $ | (168,950 | ) | ||||||
| NET INCOME (LOSS) PER COMMON SHARE: | ||||||||||||||||
| Basic | $ | (0.00 | ) | $ | 0.00 | $ | 0.00 | $ | (0.00 | ) | ||||||
| Diluted | $ | (0.00 | ) | $ | 0.00 | $ | 0.00 | $ | (0.00 | ) | ||||||
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||||||||||||||
| Basic | 401,181,389 | 325,641,762 | 351,098,340 | 325,641,762 | ||||||||||||
| Diluted | 401,181,389 | 325,641,762 | 351,098,340 | 325,641,762 | ||||||||||||
See 10Q for accompanying notes to unaudited consolidated financial statements.
About PEN Inc. (OTCQB: PENC)
PEN Inc. (PENC) is a global leader in developing, commercializing and marketing enhanced-performance products enabled by nanotechnology. The company focuses on innovative and advanced product solutions in safety, health and sustainability. For more information about PEN Inc., visit www.pen-technology.com.
Safe Harbor Statement
This press release contains forward-looking statements that involve risks and uncertainties concerning our business, products, and financial results. Actual results may differ materially from the results predicted. More information about potential risk factors that could affect our business, products, and financial results are included in our annual report on Form 10-K for the fiscal year ended December 31, 2013, and in reports subsequently filed by us with the Securities and Exchange Commission (“SEC”). All documents are available through the SEC’s Electronic Data Gathering Analysis and Retrieval System (EDGAR) at www.sec.gov or from our website listed above. We hereby disclaim any obligation to publicly update the information provided above, including forward-looking statements, to reflect subsequent events or circumstances.