25 November 2020
POET more than halves loss in Q3
For third-quarter 2020, POET Technologies Inc of Toronto, Ontario, Canada — designer and developer of the POET Optical Interposer and photonic integrated circuits (PICs) for the data-center and telecom markets — has reported a net loss of $3.5m ($0.01 per share), up from $2.9m ($0.01 per share) a year ago but cut from $6.2m ($0.02 per share) last quarter.
The loss included R&D costs level with last quarter at $1.3m. This is up from $0.5m a year ago, reflecting a redistribution of R&D activities and costs that were previously accounted for by Singapore-based subsidiary DenseLight Semiconductors Pte Ltd and reported as a discontinued operation after 1 January 2019, when the organization operated as a single entity. Since DenseLight was divested on 8 November 2019, these costs are now accounted for solely by POET.
Non-cash expenses included stock-based compensation of $1.1m and depreciation & amortization of $0.21m, compared with $0.85m and $0.19m, respectively, last quarter and $0.8m and $42,000, respectively, a year ago.
During the quarter, POET had debt-related finance costs of $244,000 (compared with $229,000 last quarter and $321,000 a year). Of this, $141,000 was non-cash (compared with $130,000 last quarter and $110,000 a year ago).
On a non-IFRS basis, cash outflow from operations has risen from -$1.3m a year ago and -$1.7m last quarter to -$2.9m.
Nevertheless, POET ended Q3/2020 with cash and cash equivalents of $9.4m, compared with $1.4m at the end of 2019.
Business highlights in Q3/2020 include:
- signing a development and supply agreement with a leading European optical systems company to design optical engines for a 400G data-center application;
- proving out all features and production methods for the Optical Interposer platform to achieve production-ready status; and
- extending the final expiry date of 12,545,350 warrants with an exercise price of CN$0.75 from 30 September to 17 November (no warrants were exercised prior to expiry).
“During the third quarter, we made extraordinary progress on our product development efforts on the Optical Interposer platform, and in several instances, exceeding our own internal performance metrics. We intend to release this data publicly once we have collected additional data from our product tests with potential customers,” says CEO Dr Suresh Venkatesan.
After the end of Q3/2020, POET completed the signing of a definitive agreement with Sanan Integrated Circuit Co Ltd of Xiamen City, Fujian province (a subsidiary of Sanan Optoelectronics Co Ltd, China’s first 6-inch pure-play compound semiconductor wafer foundry) for the formation of Super Photonics Xiamen Co Ltd, a joint venture with an estimated value of $50m. “We are actively engaged with our strategic partner Sanan IC under the newly formed joint venture aimed at the development and manufacturing of optical solutions for the data communications and telecommunications markets,” Venkatesan adds.
POET also announced that director & former executive chairman David Lazovsky is resigning from the board at the end of November to dedicate himself full-time to his most recent venture, Inorganic Intelligence. “I would like to take this opportunity to thank Dave for his several years of service to POET, including serving as executive chairman for three years,” says Venkatesan. “Dave was instrumental in helping to guide the company’s strategy and provided insightful aid in discussions with potential strategic partners.”