OSA-Direct
Sunday, 23 Jul 2017

Thin Film Electronics reports interim financial results for Q3 2016

Thinfilm has maintained a high activity level through the first nine months of 2016, as the Company has taken further steps to becoming a complete NFC solutions provider

6 Nov 2016 | Editor

Thin Film Electronics's (ThinFilm) revenue and other income in the first nine months of 2016 amounted to US$ 2,826,000, slightly ahead of the same period in 2015 (9M 2015: US$ 2,814,000). Sales revenue amounted to US$ 995,000 in 9M 2016, compared to US$ 1,225,000 in 9M 2015, and was largely related to product development projects, delivery of prototypes and products to strategic customers and partners, technology transfer revenue as well as product deliveries.

Operating costs (excluding depreciation and amortization charges) amounted to US$ 29,590,000 in the first nine months of 2016, including the cost of share-based compensation of US$ 872,000. The corresponding figure for 2015 was US$ 23,805,000 and US$ 588,000 respectively.

The group's cash balance increased by US$ 11,182,000 in the first nine months of 2016 (compared to a decrease of USD 6,232,000 in 9M 2015).

Thin Film Electronics reports financial results
for Q3 2016 (US$ ,000)
2016
Q3
2015
Q3
2016
9 months
2015
9 months
Sales - revenues 248 494 995 1,225
Other - revenues 476 434 1,516 1,306
Other - income 105 111 315 283
Revenues - Total 829 1,039 2,826 2,814
Operating Costs (9,802) (8,925) (29,590) (23,805)
Operating Profit (loss) (9,787) (8,313) (28,813) (22,070)
Net (loss) Income (9,677) (6,388) (30,424) (20,032)

Outlook

  • ThinFilm is developing technology that is expected to be critical to the extension of the Internet of Things to ordinary objects
  • The inclusion of NFC in smartphones increased dramatically over the past several years
  • According to NFC Forum, there are now one billion smart phones with NFC, and the number is expected to increase to up to 2 billion by the end of 2016
  • Annual shipments of NFC devices are expected to exceed 2 billion by 2018
  • Thinfilm began mass-production of wireless tags for electronic article surveillance (EAS), shipping over 10M units during 2015, and completing the original 13-million-unit order in H1 2016
  • Thinfilm plans to continue to increase production capacity, which currently allows seven-figure monthly production of NFC labels and multi-million monthly production of EAS tags, corresponding to an overall 40-million annual unit production capacity, based on NFC label equivalents
  • This volume is expected to support further market introduction of NFC label products during 2017 in categories such as wines and specialty foods, and field trials in liquors, while also providing capacity for the expected demand from new EAS orders, currently under negotiation
  • The process of migrating transistor manufacturing from sheet-based to roll-based PDPS production has progressed, and Thinfilm will relocate its San Jose, California-based NFC Innovation Center and current US headquarters
  • Thinfilm has taken over a new facility, which is leased for 12 years, and is currently undertaking tenant improvements within the office-space portions of the property
  • Occupancy of the new facility will take place in H1 2017, and buffer stock build up of front-end die has commenced to allow for uninterrupted backend integration and assembly and sufficient supply to meet customer demand during the 10-week relocation of sheet-based production equipment to the new facility, located approximately one mile from the current Zanker Road site
  • The new facility features a significantly larger manufacturing clean room, and enables Thinfilm to support the Company's plans to scale current production and implement a high-volume roll-to-roll manufacturing line for EAS (electronic article surveillance) by year-end 2017 and for transistor-based products in 2018 - including NFC OpenSense and NFC SpeedTap
  • By accelerating the transition to roll-to-roll printed electronics manufacturing through capex investment, Thinfilm expects to be prepared to support up to a billion-unit annual production volume by end of 2018
  • In parallel, the Company will look to partner with scale-up qualified, industrial companies to maintain its low-capex business model, as exemplified by its Thinfilm Memory partnership with Xerox
  • Thinfilm expects to maintain a significant investment in new product development, focusing on new sensor labels

www.thinfilm.no   

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