Dynasil Corporation of America Reports Third Quarter Fiscal 2014 Financial Results

  Dynasil Corporation of America Reports Third Quarter Fiscal 2014 Financial                                    Results  Company Reports Third Consecutive Quarter of Profitability  PR Newswire  WATERTOWN, Mass., Aug. 13, 2014  WATERTOWN, Mass., Aug. 13, 2014 /PRNewswire/ --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 www.dynasil.com 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 www.dynasil.com.  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 (Unaudited) ASSETS                                     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         1,468,741        1,537,318 unbilled receivables  Inventories, net of reserves            2,941,358        3,140,244  Prepaid expenses and other current      1,393,411        1,291,942 assets  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 LIABILITIES AND STOCKHOLDERS' EQUITY 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         7,576,543        15,362,333 liabilities Long-term Liabilities  Long-term debt, net of current portion  3,254,443        -  Capital lease obligations, net of       131,269          232,173 current portion  Convertible notes                       810,413          -  Pension liability                       249,966          249,966  Deferred tax liability                  179,369          186,866  Total long-term        4,625,460        669,005 liabilities Stockholders' Equity  Dynasil stockholders' equity            14,316,159       10,645,888  Noncontrolling interest                 (46,546)         -  Total stockholders'    14,269,613       10,645,888 equity 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) (Unaudited)                      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          337,033        418,318        1,046,567      1,384,739   marketing   Research and       300,296        499,732        1,024,873      1,710,090   development   General and        3,144,132      3,997,407      9,624,678      11,644,624   administrative   Impairment of   goodwill and       -              -              -              6,763,072   long-lived assets Total operating      3,781,461      4,915,457      11,696,118     21,502,525 expenses Gain on sale of      30,000         -              1,216,686      - assets Income (loss) from   156,186        (215,507)      2,237,629      (7,654,808) operations Interest expense,    145,797        181,773        567,904        545,690 net Income (loss)        10,389         (397,280)      1,669,725      (8,200,498) before taxes Income tax (credit)  (47,719)       (30,920)       (87,160)       (213,065) provision Net income (loss)    58,108         (366,360)      1,756,885      (7,987,433)   Less: Net loss   attributable to    (16,059)       -              (46,546)       -   noncontrolling   interest Net income (loss)    $        $         $          $     attributable to      74,167        (366,360)     1,803,431     (7,987,433) common stockholders Net income (loss)    $        $         $          $                          58,108        (366,360)     1,756,885     (7,987,433) Other comprehensive income (loss):   Foreign currency   141,948        (45)           214,957        (245,666)   translation Total comprehensive  $        $         $          $     income (loss)        200,056        (366,405)     1,971,842     (8,233,099) Basic net income     $        $        $        $      (loss) per common      0.00        (0.02)       0.12         (0.54) share Diluted net income   $        $        $        $      (loss) per common      0.00        (0.02)       0.12         (0.54) share 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    Contact: Patty Kehe Corporate Secretary Dynasil Corporation of America Phone: (617) 668-6855 pkehe@dynasil.com  SOURCE Dynasil Corporation of America  Website: http://www.dynasil.com  
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