Sigma Labs Reports First Quarter 2021 Financial Results

·11 min read

New Global Customer Wins Drive Improved Financial Performance for Revenue & Gross Margins

Management to Host Conference Call Today at 4:30 p.m. ET

SANTA FE, NM / ACCESSWIRE / April 22, 2021/Sigma Labs, Inc. (NASDAQ:SGLB) ("Sigma Labs" or the "Company"), a leading developer of quality assurance software for the commercial 3D metal printing industry, has reported its financial and operational results for the first quarter ended March 31, 2021.

Key First Quarter and Subsequent Operational Highlights

  • Improved financial performance with revenue increasing by more than 100% over both Q1 2020 and Q4 2020, to $0.5 million. Enhanced gross margin, resulting in gross profit before operating expenses of $0.3 million for the quarter.

  • Announced several key contract wins to further validate the company's technology, including:

  • Selected by Ermaksan Innovative Technologies to provide the Company's In-Process Quality Assurance technology, PrintRite3D®, as a factory option on Ermaksan's ENAVISION 3D metal additive machines and will be integrated with the Materialise Control Platform (MCP).

  • Awarded contract from Lockheed Martin Space Additive Design & Manufacturing Center for an initial system of its PrintRite3D in-process quality assurance solution.

  • Awarded contract from a large European aerospace company through OEM agreement with Additive Industries for a quad laser PrintRite3D system.

  • Completed two equity offerings raising gross proceeds of approximately $14.8 million.

  • Additional capital brings new institutional investors and enables Company to further invest in business to expand unit sales and revenue growth.

Management Commentary
"The first quarter of 2021 was marked by continued adoption of Sigma Labs industry standard IPQA technology that was validated by our improved financial performance with solid PrintRite3D unit sales, a strengthened balance sheet showing strong institutional investor interest, and macro tailwinds signaling a return to growth in the coming months for the 3D metal printing industry," said Mark K. Ruport, President and CEO of Sigma Labs. "We are increasingly seeing upticks of activity in the 3D metal printing market, resulting in several new contracts for initial systems. We believe that each new customer will open up opportunities for additional systems as our customers expand and accelerate their Additive Manufacturing initiatives.

"Recently we announced a $9.7 million registered direct offering priced at-the-market under Nasdaq rules to significantly strengthen our balance sheet and provide us with sufficient working capital to allow us to meet the growth demands of the market. Combined with our previous $5.1 million public offering which included the full exercise of the underwriter's over-allotment option, we now have over $16.8 million in cash to support growth, direct sales and marketing. This achievement represents a significant milestone for the company and will put us in the strongest financial position in the history of Sigma Labs.

"For the remainder of the year, we are continuing along our roadmap to focus on new markets and opportunities, including aerospace, space exploration and defense. We are leveraging our sales team to expand sales through our current partnerships, and through direct sales to global end-user manufacturers, universities and R&D organizations. Additionally, we will continue to seek out new and expanded strategic partnerships with 3D printer OEMs, software companies, and integrators.

"The outlook for the Additive Manufacturing industry in 2021 appears robust, with increasing demand predicted by Statista and others as 3D metal printing goes from prototyping to full industrialization. We believe we are poised to set the standard for quality assurance and capture a significant share of the market. We look forward to sharing more of our accomplishments and contract wins as the year progresses," concluded Ruport.

First Quarter 2021 Financial Results
Revenue for the first quarter of 2021 totaled $458,140. This compares to revenues of $221,730 for the first quarter of 2020. The increase in revenue was primarily due to increased PrintRite3D® unit sales in the first quarter of 2021.

Gross profit for the first quarter of 2021 was $329,809, which resulted in a gross margin of 72% as compared to negative $22,973 in the first quarter of 2020.

Total operating expenses for the first quarter of 2021 were $1.8 million as compared to total operating expenses of $1.6 million for the same period in 2020.

Cash used in operating activities for the three months ended March 31, 2021 totaled $1.2 million compared to $1.5 million in the first quarter of 2020, a decrease of $0.3 million.

Net loss for the first quarter of 2021 was $0.7 million, or $(0.09) per share, as compared to a net loss of $1.6 million, or $(1.30) per share, in the first quarter of 2020.

Cash totaled $16.8 million at March 31, 2021, as compared to $3.7 million at December 31, 2020. The increase in cash during the period was a result of a $9.7 million registered direct offering of common stock and short-term warrants and a public offering of shares of common stock with gross proceeds of approximately $5.1 million. In addition, warrant exercises during the first quarter of 2021 have contributed an additional $1.1 million in cash proceeds.

First Quarter 2021 Results Conference Call
Sigma Labs President and CEO Mark Ruport and CFO Frank Orzechowski will host the conference call, followed by a question-and-answer period.

To access the call, please use the following information:

Date:

Thursday, April 22, 2021

Time:

4:30 p.m. Eastern time, 1:30 p.m. Pacific time

Toll-free dial-in number:

1-877-407-9039

International dial-in number:

1-201-689-8470

Conference ID:

13718662

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact MZ Group at 1-949-491-8235.

The conference call will be broadcast live and available for replay at http://public.viavid.com/index.php?id=144322 and via the investor relations section of the Company's website at www.sigmalabsinc.com.

A replay of the conference call will be available after 7:30 p.m. Eastern time through May 6, 2021.

Toll-free replay number:

1-844-512-2921

International replay number:

1-412-317-6671

Replay ID:

13718662

About Sigma Labs
Sigma Labs Inc. is a leading provider of in-process quality assurance (IPQA®) software to the additive manufacturing industry. Sigma Labs specializes in the development and commercialization of real-time monitoring solutions known as PrintRite3D® for 3D metal advanced manufacturing technologies. PrintRite3D detects and classifies defects and anomalies real-time during the manufacturing process, enabling significant cost-savings and production efficiencies. Sigma Labs believes its software product will be a major catalyst for the acceleration and adoption of 3D metal printing. For more information, please visit www.sigmalabsinc.com.

Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (which Sections were adopted as part of the Private Securities Litigation Reform Act of 1995). Statements preceded by, followed by or that otherwise include the words "believe," "anticipate," "estimate," "expect," "intend," "plan," "project," "prospects," "outlook," and similar words or expressions, or future or conditional verbs such as "will," "should," "would," "may," and "could" are generally forward-looking in nature and not historical facts. These forward-looking statements involve known and unknown risks, uncertainties and other factors. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are risks relating to, among other things, market and other conditions, Sigma Labs' business and financial condition, Sigma Labs' ability to satisfy its capital needs through increasing its revenue and obtaining additional financing, and the impact of COVID-19, general economic, industry or political conditions in the United States or internationally. The Company disclaims any intention to, and undertakes no obligation to, revise any forward-looking statements, whether as a result of new information, a future event, or otherwise. For additional risks and uncertainties that could impact the Company's forward-looking statements, please see disclosures contained in Sigma Labs' public filings with the SEC, including the "Risk Factors" in Sigma Labs' Annual Report on Form 10-K, and which may be viewed at www.sec.gov.

Investor Contact:
Chris Tyson
Executive Vice President
MZ Group - MZ North America
949-491-8235
SGLB@mzgroup.us
www.mzgroup.us

Company Contact:
Steven Gersten
Sigma Internal IR
813-334-9745
investors@sigmalabsinc.com

Sigma Labs, Inc.
Condensed Balance Sheets
(Unaudited)

March 31, 2021

December 31, 2020

ASSETS

Current Assets:

Cash

$

16,843,201

$

3,700,814

Accounts Receivable, net

388,050

331,562

Inventory

747,780

659,651

Prepaid Assets

135,453

90,735

Total Current Assets

18,114,484

4,782,762

Other Assets:

Property and Equipment, net

128,318

138,626

Intangible Assets, net

762,368

753,122

Long-Term Prepaid Asset

26,000

26,000

Total Other Assets

916,686

917,748

TOTAL ASSETS

$

19,031,170

$

5,700,510

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:

Accounts Payable

$

280,437

$

128,937

Deferred Revenue

76,417

77,957

Accrued Expenses

217,404

243,815

Derivative Liability

4,905,927

-

Total Current Liabilities

5,480,185

450,709

Long-Term Liabilities

Stock Appreciation Rights

93,525

48,341

CARES Act Deferred Payroll Taxes

37,728

37,728

Total Long-Term Liabilities

131,253

86,069

TOTAL LIABILITIES

5,611,438

536,778

Stockholders' Equity

Preferred Stock, $0.001 par; 10,000,000 shares authorized; 465 and 715 issued and outstanding, respectively

1

1

Common Stock, $0.001 par; 12,000,000 shares authorized; 10,493,598 and 5,995,320 issued and outstanding, respectively

10,494

5,995

Additional Paid-In Capital

47,225,812

38,262,744

Accumulated Deficit

(33,816,575

)

(33,105,008

)

Total Stockholders' Equity

13,419,732

5,163,732

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

19,031,170

$

5,700,510

Sigma Labs, Inc.
Condensed Statements of Operations
(Unaudited)

Three Months Ended

March 31, 2021

March 31, 2020

REVENUES

$

458,140

$

221,730

COST OF REVENUE

128,331

244,703

GROSS PROFIT

329,809

(22,973)

OPERATING EXPENSES:

Salaries & Benefits

847,171

652,197

Stock-Based Compensation

117,477

154,171

Operating R&D Costs

196,340

53,689

Investor & Public Relations

108,341

215,441

Organization Costs

77,616

49,444

Legal & Professional Service Fees

176,847

184,891

Office Expenses

148,225

147,747

Depreciation & Amortization

23,031

18,012

Other Operating Expenses

86,356

84,049

Total Operating Expenses

1,781,404

1,559,641

LOSS FROM OPERATIONS

(1,451,595)

(1,582,614)

OTHER INCOME (EXPENSE)

Interest Income

55

851

Gain on Derivative Liability

802,285

-

Exchange Rate Loss

(51

)

(1,391

)

Interest Expense

(1,353

)

(431

)

Total Other Income (Expense)

800,936

(971)

LOSS BEFORE PROVISION FOR INCOME TAXES

(650,659)

(1,583,585)

Provision for Income Taxes

-

-

Net Loss

$

(650,659)

$

(1,583,585)

Preferred Dividends

(60,908

)

(315,247

)

Net Loss Applicable to Common Stockholders

$

(711,567)

$

(1,898,832)

Net Loss per Common Share - Basic and Diluted

$

(0.09)

$

(1.30)

Weighted Average Number of Shares Outstanding - Basic and Diluted

7,790,121

1,463,627

Sigma Labs, Inc.
Condensed Statements of Cash Flows
(Unaudited)

Three Months Ended

March 31, 2021

March 31, 2020

OPERATING ACTIVITIES

Net Loss

$

(650,659

)

$

(1,583,585

)

Adjustments to reconcile Net Loss to Net Cash used in operating activities:

Noncash Expenses:

Depreciation and Amortization

23,031

18,012

Gain on Derivative Liability

(802,285

)

-

Stock Based Compensation Employees

117,477

154,171

Stock Based Compensation - Third Party Services

30,981

39,618

Stock Based Compensation - Directors

61,471

-

Change in assets and liabilities:

Accounts Receivable

(56,488

)

(63,885

)

Inventory

(88,129

)

92,915

Prepaid Assets

(44,718

)

63,006

Accounts Payable

151,500

(243,000

)

Deferred Revenue

(1,540

)

(45,330

)

Accrued Expenses

(26,411

)

42,383

Long-term portion of Stock Appreciation Rights

45,184

-

NET CASH USED IN OPERATING ACTIVITIES

(1,240,586

)

(1,525,696

)

INVESTING ACTIVITIES

Purchase of Property and Equipment

(5,350

)

(11,474

)

Purchase of Intangible Assets

(16,619

)

(39,055

)

NET CASH USED IN INVESTING ACTIVITIES

(21,969

)

(50,529

)

FINANCING ACTIVITIES

Gross Proceeds from Public and Private Issuances of Securities

14,869,899

2,100,000

Less Offering Costs

(1,600,967

)

(428,876

)

Payment of Note Payable

-

(50,000

)

Proceeds from Exercise of Warrants

1,136,010

499,200

NET CASH PROVIDED BY FINANCING ACTIVITIES

14,404,942

2,120,324

NET CHANGE IN CASH FOR PERIOD

13,142,387

544,099

CASH AT BEGINNING OF PERIOD

3,700,814

86,919

CASH AT END OF PERIOD

$

16,843,201

$

631,018

Supplemental Disclosures:

Noncash investing and financing activities disclosure:

Issuance of Common Shares for Preferred Dividends

60,908

315,247

Other noncash operating activities disclosure:

Issuance of Securities for Services

92,452

39,618

Disclosure of cash paid for:

Interest

$

1,353

$

1,458

Income Taxes

$

-

$

-

SOURCE: Sigma Labs, Inc.



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