6 October 2010


Emcore revenue shrinks 3% as it concludes accounting review

In its delayed unaudited financial results for fiscal third-quarter 2010 (to end-June), Emcore Corp of Albuquerque, NM, USA, which makes components and subsystems for the fiber-optic and solar power markets, has reported revenue of $46.6m, up 21% on $38.5m a year ago. This was down 3% on last quarter's $48.2m, but this was due to a timing issue with a major shipment: the Photovoltaics segment experienced a quarter-end delay in shipping a satellite solar cell order to an international customer due to an “unforeseen logistics issue” (the order was shipped in August and the revenue will be recognized in the September quarter).

Of the total quarterly revenue, Photovoltaics was hence down 16% on $18m last quarter to $15.1m. Meanwhile, Fiber Optics revenue was up 4% on $30.2m to $31.5m.

Gross margin has fallen from last quarter’s 32.1% to 27.5%, including 30.7% for Photovoltaics (down from last quarter’s record 46.6%) and 25.9% for Fiber Optics (up from 23.6%).

Although an improvement from $7.3m a year ago, non-GAAP net loss of $3m is up from $1.8m last quarter. During the quarter, cash, cash equivalents, available-for-sale securities, and current restricted cash fell from $19m to about $16m. Working capital totaled $33.1m. Emcore adds that, over the last year, it has achieved positive cash flow from operations in two of the last four quarters, including the quarters to end-September 2009 and end-March 2010. The firm continues to maintain a $14m credit facility with Bank of America and a $23m committed and available equity line of credit facility with the Commerce Court Small Cap Value Fund Ltd.

During the quarter, order backlog fell slightly from $68m last quarter to $67.6m. This includes $42.5m in Photovoltaics (down 3% on $41.3m) and $25.1m in Fiber Optics (down 6% on $26.7m).

Neverthless, despite this slight dip, for fiscal fourth-quarter (to end-September 2010), Emcore expects significant positive cash flow from operations, based on revenue rising 16–18% sequentially to $54–55m (with revenue growth in not only Fiber Optics but also Photovoltaics).

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