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10 November 2009


Advanced Photonix maintains gross margin despite slump

For its fiscal second-quarter 2010 (ended 25 September 2009), Advanced Photonix Inc of Ann Arbor, MI, USA (which designs and makes silicon, InP- and GaAs-based photodetectors, high-speed optical receivers, and terahertz instrumentation) has reported sales of $5.4m. This is down 34% on $8.2m a year ago and 8% on $5.9m on last quarter due to a broad-based decline across four of the firm’s five markets.

“The first half of the year was negatively impacted by the recessionary environment, and this quarter was in line with our expectations,” says chairman & CEO Richard Kurtz. “We have taken the necessary cost-reduction steps to minimize the impact of the revenue shortfall in the first half of the year,” he adds.

Hence, for fiscal first-half 2010, gross margin was 45%, down only slightly on 46% a year ago despite the 29% drop from what had been record half-year revenue, reflecting cost-reduction initiatives and the prior year's facilities consolidation. The latter involved consolidation of the wafer fabs in Camarillo, CA and Dodgeville, WI into Ann Arbor in mid-2007 and closure of the silicon photodiode assembly facility in Dodgeville in late 2007.

On a non-GAAP basis, net loss was $452,000, compared to net income of $315,000 last quarter and $306,000 a year ago. EBITDA (earnings before interest, taxes, depreciation, and amortization) was minus $220,000, compared to positive EBITDA of $554,000 last quarter and $557,000 a year ago.

“We anticipate second-half revenue to show a return to growth, driven mainly by our HSOR [high-speed optical receivers] and Terahertz product platforms,” says Kurtz. “While we do not anticipate top-line revenue to meet 2009 numbers, predominantly due to the industrial product market being closely tied to the overall economy, we do expect the second half of the year to show growth over the first six months and, with the reduced cost structure, a return to GAAP profitability,” he adds. “We continue to invest in our product platforms that position us for additional future growth as the overall economy improves.”

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