Quarterly Report • Nov 2, 2023
Quarterly Report
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Q3
"Providing support for multiple customer proof of concept (PoC) projects in various segments and carrying out a variety of improvement projects kept the pressure on the organisation during the third quarter, although the period was relatively sluggish from an order intake and revenue perspective.
The consumer market remains challenging and is focused on cost reduction rather than implementing new, innovative and more expensive technology. This is currently impacting our ability to achieve new smartphone design-wins. Nevertheless, we continue to be persistent and push the TLens® message. We hope that consumer sentiment will change once the overall economy starts improving.
Augmented reality (AR) customer cases continue to develop positively, although a few design-in cases are experiencing some delays. Two design-wins related to AR enterprise glasses have been secured and are currently in mass production. The customer pipeline in this segment continues to grow, and we are involved in both enterprise and consumer cases.
As for new market segments, we continue address both automotive and healthcare. There seems to be a clear need for autofocus technology in the automotive market for a variety of use cases. However, there are still many questions to be answered, both with respect to market need and technology fit. A long development and qualification cycle is to be expected, so potential revenue from this market segment is many years ahead of us. Healthcare-related cases are more mature, and the cooperation we have developed with Kavli Institute at the Norwegian University of Science and Technology (NTNU), and the contribution we have made to the development of the Mini2P microscope1 has led to several similar engagements. Lately, for example, we have begun collaborating with commercial players supplying products to the various research laboratories around the world. In addition to this, we are engaged in several commercial endoscope cases.
Step by step, poLight is moving in the right direction, even under difficult market circumstances – particularly in the consumer market. Nevertheless, business prospects in important future markets are maturing and we continue working hard to overcome the market and operational challenges that still lie ahead!"
| Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|
| 3.1 | 5.3 | 17.4 | 9.3 | 13.4 |
| 2.6 | 3.2 | 9.2 | 5.8 | 8.5 |
| -20.5 | -11.3 | -52.5 | -43.7 | -58.7 |
| -16.6 | -11.0 | -49.5 | -45.2 | -58.9 |
| -20.3 | -19.6 | -76.9 | -48.4 | -63.6 |
| -20.3 | -20.1 | 48.3 | -53.6 | -73.5 |
1 An open-source miniature 2-photon microscope brain explorer for fast high-resolution calcium imaging in freely-moving mice
poLight works primarily with two categories of subcontractors – a MEMS/wafer supplier (ST Microelectronics (ST) in Italy) and assembly partners. While ST produces the wafers/actuators, assembly partners assemble the complete product. The polymer (i.e. lens material) is produced at poLight's headquarters.
Assembly and testing activity was relatively low during the quarter and mainly related to healthcare, AR/MR and industrial cases at various stages. In addition to yield improvement work, the quarter was used to relocate final test activity to the factory in the Philippines. All assembly and testing is now conducted in the Philippines instead of being split between Taiwan and the Philippines. This will both streamline logistics and reduce costs.
During the quarter ST continued to deliver wafers based on the purchase order placed Q2-2021, and deliveries was completed mid-October.
Important improvement projects relating to the performance and reliability of existing products (TLensÒ) continued during the quarter. Some aspects will be implemented in the short term, while others have a longer-term horizon. With regard to new products/functionality, the main focus has been on TWedgeÒ, a potential new product that enables wobulation, a method for improving resolution in AR projection display solutions. Technical samples of this product were delivered to selected customers during the third quarter.
poLight is actively engaged in several market areas. This includes consumer applications, such as smartphones, augmented reality devices and accessories, as well as a broad range of professional applications, such as barcode readers, medical devices and augmented/mixed reality glasses. Recent developments in the automotive market indicate a future need for autofocus solutions, and TLensÒ has been mentioned as a potential candidate. This market is demanding and it will take a long time to qualify for such applications. Nevertheless, it is worthwhile exploring, since the volume potential is significant.
Interest in poLight´s solutions remains high and the company continues to make progress on several projects with potential customers. In sum, TLensÒ technology is increasingly being recognised by potential customers in a wide range of market areas. Over time, this is expected to develop into a diversified revenue base for poLight.
The new camera module concept, based on add-in TLensÒ design, is continuing to open new opportunities for different applications. Several reference designs have been developed to position TLensÒ for various use cases. During the quarter, the focus was on smartphone and augmented reality applications. Other applications, such as webcams, laptops, smart home devices, wearables, etc., are also being explored.
Demonstration of the Meizu 20 Infinity, using TLens® in the selfie camera, continued during the quarter. From a performance perspective, the feedback has been positive, but the cost difference between a TLens®-based AF camera and a non-AF or VCM-based AF solution is dampening interest in the current market climate. The cost difference is mainly due to less mature assembly processes, for the add-in designs, at the camera module partners.
In the consumer market, poLight has so far achieved four design-wins, is involved in three ongoing PoC projects and nine PoCs that are in the planning stage. In addition to the above, the company has achieved one design-in and eight ongoing PoCs related to consumer AR/MR-related products, including those relevant for TWedge®.
TLensÒ is being considered/tested by several important AR/MR market players. The TLens® technology's low powerconsumption, no gravity sensitivity, temperature stabilisation (often referred to as athermalisation), high speed and compactness stand out as key technical benefits.
The AR market segment continued to develop positively for poLight during the quarter. TLens® is used/planned for use in both world-facing cameras and displays. The company is currently included in two AR enterprise products already on the market. These are the Magic Leap 2 and the latest product from LLVision. In addition, five design-ins have been confirmed (one for consumer application, two VR related). Of which 2 may be launched/announced end of 2023, - but risk for further delays. One case confirmed delayed. The consumer related case is progressing very well – promising high-volume case. Eleven PoCs are ongoing (eight of which are for consumer applications), while 14 PoCs are in the planning stage. Three of the design-ins were planned to be launched during the second half of 2023, but the latest information indicates that there may be some delays.
The AR/MR market is entering a very important phase and poLight expects to see several companies releasing new products in the coming years. Most of the initial customer cases relate to the professional/business market, so initial volumes will be low. Over time, however, AR/MR devices are expected to address the consumer market, prompting a significant increase in demand some years down the road. In the longer term, the AR/MR segment is expected to be an important market for the company.
It will take time to develop this market and will require entry into some broader application areas. Currently, five companies use TLens® in commercially available products (design-wins). All five cases are still shipping to customers and are expected to do so for several more years. During the quarter, it was announced that Superlead, a Chinese customer, had placed a follow-on order worth NOK 1.15 million. At the same time, it was confirmed that Superlead now uses TLens® in four products. Other existing customers are also considering expanding their use of TLens®.
In addition to the five design-wins, the company is involved in 12 ongoing PoCs, nine of which are for barcode/machine vision applications.
The company is continuing to support selected opportunities in the healthcare market segment. The cooperation poLight has developed with Kavli Institute at the Norwegian University of Science and Technology (NTNU), and the contribution the company has made to the development of the Mini2P microscope2 has led to several similar engagements. Lately, for example, the company has also begun collaborating with commercial players supplying products to the various research laboratories around the world. For further details, see the press release dated 25 September 2023. In addition to this, poLight is engaged in several commercial endoscope cases. The healthcare market will take time to develop but may represent an attractive market segment in the longer term.
At the end of the quarter, the company was engaged in one design-win (Kavli, Mini2P), two design-ins (a laparoscope from Xenocor and a miniature two-photon microscope being developed by another company for commercial sale), and 17 ongoing PoCs, of which 10 relate to Mini2P. Xenocor seems to be experiencing some unexpected delays in the market launch.
During the quarter, the company has been engaged in three PoCs, while five others are in the planning stage. Going forward, this market segment is expected to have a need for autofocus technology and TLens® is one of the solutions being explored. The market is significant in size but is challenging and will take many years to develop.
2 An open-source miniature 2-photon microscope brain explorer for fast high-resolution calcium imaging in freely-moving mice
| (in NOK million) | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|
| Revenue | 3.1 | 5.3 | 17.4 | 9.3 | 13.4 |
| Cost of sales | -0.5 | -2.1 | -8.2 | -3.5 | -4.8 |
| Gross profit | 2.6 | 3.2 | 9.2 | 5.8 | 8.5 |
| Research and development expenses 1) | -8.0 | -7.2 | -24.3 | -26.8 | -32.9 |
| Sales and marketing expenses | -4.0 | -2.6 | -11.8 | -9.4 | -13.1 |
| Operational / supply chain expenses | -4.9 | -1.9 | -11.8 | -6.3 | -9.2 |
| Administrative expenses | -6.1 | -2.8 | -13.8 | -7.0 | -12.1 |
| EBITDA | -20.5 | -11.3 | -52.5 | -43.7 | -58.7 |
| Share option plan expense | 3.2 | 1.0 | 5.2 | 3.6 | 4.8 |
| Accrued employer's NICs re. share option plan | 0.7 | -0.7 | -2.2 | -5.0 | -5.0 |
| EBITDA ex share options | -16.6 | -11.0 | -49.5 | -45.2 | -58.9 |
| Depreciation and amortisation and net | |||||
| impairment losses | -2.6 | -2.3 | -7.2 | -8.0 | -10.4 |
| EBIT ex share options | -19.2 | -13.3 | -56.7 | -53.2 | -69.3 |
1) R&D expenses, net of government grants (see details of grants in Note 9)
Revenue totalled NOK 3.1 million in Q3 2023 (NOK 5.3 million in Q3 2022), which reflects deliveries of TLensÒ and ASICs for commercial use and customer development projects mainly related to healthcare, AR/MR and industrial cases at various stages.
R&D expenditure, net of government grants, amounted to NOK 8.0 million, compared with NOK 7.2 million in Q3 2022.
Sales and marketing expenses came to NOK 4.0 million in Q3 2023 (NOK 2.6 million). Operational/supply chain expenses totalled NOK 4.9 million (NOK 1.9 million), due to increased internal resource usage relating to yield improvement and development of a wafer database.
Administrative expenses totalled NOK 6.1 million in the quarter, compared with NOK 2.8 million in Q3 2022. During the quarter, two amendments to the share option plan were approved. The first authorised the issue of new share options, while the second extended the deadline for exercise of the share options that originally expired in October 2023. The new amendments and employer's national insurance contributions (NICs) on share options (see below for further details), contributed to the increased expenses compared with Q3 2022.
EBITDA totalled NOK -20.5 million in Q3 2023 (NOK -11.3 million). Share option plan expense and an increased number of employees and consultants are the main drivers for the increased expenditure.
Share option plan expenses amounted to NOK 3.2 million in Q3 2023 (NOK 1.0 million), while NOK 0.7 million in accrued employer's national insurance contributions (NICs) was recognised in the quarter (NOK 0.7 million in reversed accruals in Q3 2022). The company pays employer's NICs on the difference between the share's market value and the option's strike price on the date of exercise. The decrease in accrued employer's NICs was mainly attributable to the decrease in poLight's share price in the period.
Depreciation and amortisation, which primarily related to non-current intangible assets, totalled NOK 2.6 million in the quarter (NOK 2.3 million).
| Balance sheet | |||
|---|---|---|---|
| (in NOK million) | Q3 2023 | Q3 2022 | FY 2022 |
| Property, plant and equipment | 9.8 | 6.6 | 10.7 |
| Intangible assets | 19.4 | 26.7 | 24.9 |
| Right-of-use assets | 3.1 | 4.0 | 3.9 |
| Inventories | 69.6 | 36.0 | 45.6 |
| Receivables and prepayments | 7.7 | 7.4 | 8.9 |
| Cash and cash equivalents | 132.8 | 104.4 | 84.2 |
| Total assets | 242.4 | 185.1 | 178.2 |
| Total equity | 224.3 | 166.2 | 150.7 |
| Total current liabilities | 16.0 | 15.7 | 24.6 |
| Total non-current liabilities | 2.1 | 3.2 | 3.0 |
| Total equity and liabilities | 242.4 | 185.1 | 178.2 |
As at 30 September 2023, total assets came to NOK 242.4 million, compared with NOK 185.1 million as at 30 September 2022 and NOK 178.2 million as at 31 December 2022.
Property, plant and equipment totalled NOK 9.8 million as at 30 September 2023, compared with NOK 6.6 million as at 30 September 2022 and NOK 10.7 million as at 31 December 2022. In the second half of 2022, investments were made in additional final test equipment in both Taiwan and the Philippines. The equipment includes sorting features with respect to various performance parameters.
At the reporting date, intangible assets totalled NOK 19.4 million, compared with NOK 26.7 million as at 30 September 2022, reflecting amortisation during the year, and NOK 24.9 as at 31 December 2022.
Inventories increased by NOK 24.1 million in the year to date, to stand at NOK 69.6 million at the close of the third quarter (NOK 36.0 million at 30 September 2022 and NOK 45.6 million at 31 December 2022). The increase in inventories mainly relates to wafers from ST Microelectronics.
As at 30 September 2023, poLight had cash and cash equivalents totalling NOK 132.8 million, compared with NOK 104.4 million as at 30 September 2022 and NOK 84.2 million as at 31 December 2022. The rights issue in the second quarter generated NOK 125.8 million in net proceeds.
Total current liabilities amounted to NOK 16.0 million as at 30 September 2023, compared with NOK 15.7 million as at 30 September 2022 and NOK 24.6 million as at 31 December 2022.
| (in NOK million) | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|
| Net cash flow used in operating activities | -20.3 | -19.6 | -76.9 | -48.4 | -63.6 |
| Net cash flow used in investing activities | 0.0 | -0.3 | -0.1 | -4.8 | -9.2 |
| Net cash flow from/(used in) financing activities | 0.0 | -0.2 | 125.3 | -0.4 | -0.7 |
| Net increase/decrease in cash and cash | |||||
| equivalents | -20.3 | -20.1 | 48.3 | -53.6 | -73.5 |
The net cash outflow from operating activities totalled NOK 20.3 million in Q3 2023, compared with NOK 19.6 million in Q3 2022. Working capital increased by NOK 4.5 million in the quarter, of which NOK 3.4 million relates to the increased inventory.
The net decrease in cash and cash equivalents totalled NOK 20.3 million for the quarter, compared with a net decrease of NOK 20.1 million in the same period in 2022.
The risk related to current tensions between China and Taiwan mentioned in earlier quarterly reports has been resolved because of moving all assembly and test activity from Taiwan to the Philippines.
poLight does not have any operations, customers or direct suppliers in Russia or Ukraine. The war in Ukraine has therefore not had any direct consequences of significance for the Group's operations, other than the general impact of the war on the global situation.
The Group's TLensÒ technology, and products derived from this technology, are involved in different qualification tests for various applications by potential customers. There is no guarantee that the TLensÒ products (or other products produced by the Group) will meet the performance parameters set by potential customers, or by parties testing the Group's products at a later time. If the Group's products do not meet such performance parameters, the Group may be required to implement changes to its products or may not be able to enter into commercial agreements with potential customers. Any requirement to implement changes to the Group's products may imply a delay in the commercialisation of the Group's technology and may also entail significant costs that may not be recovered. Furthermore, there is no guarantee that changes to the Group's products will be sufficient to satisfy the demands of the Group's potential customers. Failure to enter into commercial agreements will have a material adverse effect on the Group's revenues, profitability and financial position.
Over the next 12 months, the Group's principal source of liquidity will still be cash generated from financing, equity and/or debt, in addition to net cash flows generated from sales. Accordingly, these consolidated financial statements have been prepared on the assumption that both the Group and the parent company are going concerns, and management confirms that this an appropriate assumption.
The consumer market is currently challenging and there are no signs of improvement in the short term. Nevertheless, poLight will continue to address this market by actively capitalising on its first important smartphone reference. Further key actions will be to mature and cost optimise TLens®-based camera module solutions, addressing both component and system level aspects, continuously enhance important performance parameters, actively develop the capability and relationships with existing and new camera module partners with respect to add-in designs, and address higher value applications such as back-facing cameras. It is important to emphasise that all the activities listed above will have direct relevance for other application areas, such as augmented/mixed reality.
AR/MR will be a key market for poLight going forward. So far, there seems to be a good match between market need and the properties of the TLens®, and potentially also the TWedge® at a later stage. Volumes for AR/MR cases are still low, since the majority of the applications relate to the enterprise market. poLight aims to establish a strong position at an early stage and grow its business within this area as consumer cases start to be deployed. However, this is expected to still be some years ahead of us.
Looking forward, another potential high-volume market is the automotive sector. poLight is currently engaging with key playersin this market to better understand the possibilities and challengesinvolved. It has not yet been decided whether this is a market poLight will actively address, but it is being investigated and a business case will be developed. The same applies to the healthcare market, with cases within the field of endoscopy increasing in number.
Going forward, poLight plans to continue strengthening its organisation to enable it to address all the above-mentioned opportunities and challenges in a professional and robust manner.
This report contains statements regarding the future. In particular, the section "Outlook" contains forward-looking statements regarding the Group's expectations. All statements regarding the future are subject to inherent risks and uncertainties, and many factors can lead to actual results and developments deviating substantially from what has been expressed or implied in such statements. These factors include the risk factors relating to the Group's activities described in the section "Risk factors" above and in poLight's Annual Report for 2022, including the section "Risks and risk management" in the Board of Directors' Report.
| NOK 000 | Note | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|---|
| Sale of goods | 2 947 | 3 092 | 17 059 | 6 498 | 10 034 | |
| Rendering of services | 103 | 2 181 | 305 | 2 771 | 3 328 | |
| Revenue | 3 051 | 5 272 | 17 364 | 9 270 | 13 363 | |
| Cost of sales | -469 | -2 086 | -8 164 | -3 517 | -4 826 | |
| Gross profit | 2 581 | 3 186 | 9 200 | 5 753 | 8 536 | |
| Research and development expenses net of governmental grants |
6,9 | -7 995 | -7 175 | -24 255 | -26 780 | -32 907 |
| Sales and marketing expenses | -4 029 | -2 633 | -11 841 | -9 373 | -13 122 | |
| Operational / supply chain expenses | -4 886 | -1 942 | -11 836 | -6 272 | -9 179 | |
| Administrative expenses | -6 147 | -2 759 | -13 789 | -7 023 | -12 068 | |
| Operating result before depreciation and amortisation | ||||||
| (EBITDA) | -20 475 | -11 322 | -52 521 | -43 694 | -58 740 | |
| Depreciation and amortisation and net impairment losses | 8 | -2 616 | -2 271 | -7 165 | -8 013 | -10 400 |
| Operating result (EBIT) | -23 092 | -13 594 | -59 686 | -51 706 | -69 140 | |
| Net financial items | 7 | 1 626 | 704 | 1 874 | 664 | 1 496 |
| Loss before tax | -21 466 | -12 890 | -57 812 | -51 042 | -67 644 | |
| Income tax expense | -81 | -49 | -110 | -53 | -242 | |
| Loss for the period | -21 547 | -12 939 | -57 922 | -51 095 | -67 886 | |
| Attributable to: | ||||||
| Equity holders of the parent | -21 547 | -12 939 | -57 922 | -51 095 | -67 886 | |
| Earnings per share: | ||||||
| Basic, attributable to ordinary equity holders of the parent | ||||||
| (NOK) | -0.33 | -0.25 | -0.95 | -0.98 | -1.31 | |
| Diluted, attributable to ordinary equity holders of the parent (NOK) |
-0.33 | -0.25 | -0.95 | -0.98 | -1.31 |
| NOK 000 | Note | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|---|
| Loss for the period | -21 547 | -12 939 | -57 922 | -51 095 | -67 886 | |
| Other comprehensive income | ||||||
| Exchange differences on translation of foreign operations | -183 | 38 | 239 | 101 | 95 | |
| Income tax effect | 0 | 0 | 0 | 0 | 0 | |
| Net other comprehensive income to be reclassified to | ||||||
| profit or loss in subsequent periods | -183 | 38 | 239 | 101 | 95 | |
| Total comprehensive income for the period, net of tax | -21 730 | -12 901 | -57 683 | -50 994 | -67 791 | |
| Attributable to: | ||||||
| Equity holders of the parent | -21 730 | -12 901 | -57 683 | -50 994 | -67 791 |
| NOK 000 Note |
Q3 2023 | Q3 2022 | FY 2022 |
|---|---|---|---|
| ASSETS | |||
| Property, plant and equipment | 9 848 | 6 612 | 10 748 |
| Intangible assets 8 |
19 399 | 26 674 | 24 855 |
| Right-of-use assets | 3 055 | 3 982 | 3 871 |
| Total non-current assets | 32 302 | 37 268 | 39 474 |
| Inventories | 69 632 | 36 025 | 45 577 |
| Trade and other receivables 9 |
7 298 | 4 071 | 8 386 |
| Prepayments | 419 | 3 366 | 557 |
| Cash and cash equivalents | 132 772 | 104 413 | 84 249 |
| Total current assets | 210 121 | 147 875 | 138 769 |
| Total assets | 242 423 | 185 143 | 178 242 |
| EQUITY AND LIABILITIES | |||
| Share capital | 2 648 | 2 078 | 2 078 |
| Share premium | 271 300 | 209 573 | 145 785 |
| Reserves | 1 369 | 1 136 | 1 130 |
| Retained earnings | -51 050 | -46 563 | 1 699 |
| Total equity | 224 267 | 166 223 | 150 692 |
| Lease liabilities | 2 136 | 3 178 | 2 970 |
| Total non-current liabilities | 2 136 | 3 178 | 2 970 |
| Trade and other payables 10 |
13 856 | 14 244 | 22 480 |
| Current lease liabilities | 1 163 | 998 | 1 100 |
| Provisions | 1 000 | 500 | 1 000 |
| Total current liabilities | 16 020 | 15 742 | 24 581 |
| Total liabilities | 18 156 | 18 920 | 27 550 |
| Total equity and liabilities | 242 423 | 185 143 | 178 242 |
| Attributable to equity holders of the parent | ||||||||
|---|---|---|---|---|---|---|---|---|
| NOK 000 Note |
Share capital |
Share premium |
Retained earnings |
Translation reserve |
Total | |||
| As at 1 January 2022 | 2 077 | 209 320 | 977 | 1 035 | 213 409 | |||
| Loss for the period | -51 095 | -51 095 | ||||||
| Other comprehensive income | 101 | 101 | ||||||
| Total comprehensive income | 0 | 0 | -51 095 | 101 | -50 994 | |||
| Share options exercised | 1 | 253 | 254 | |||||
| Equity-settled share-based payment | 3 554 | 3 554 | ||||||
| As at 30 September 2022 | 2 078 | 209 573 | -46 564 | 1 136 | 166 223 | |||
| As at 1 January 2023 | 2 078 | 145 785 | 1 699 | 1 130 | 150 692 | |||
| Loss for the period | -57 922 | -57 922 | ||||||
| Other comprehensive income | 239 | 239 | ||||||
| Total comprehensive income | 0 | 0 | -57 922 | 239 | -57 683 | |||
| Issue of ordinary shares | 568 | 147 931 | 148 500 | |||||
| Share options exercised | 2 | 285 | 287 | |||||
| Transaction costs | -22 702 | -22 702 | ||||||
| Equity-settled share-based payment | 5 173 | 5 173 | ||||||
| As at 30 September 2023 | 2 648 | 271 300 | -51 050 | 1 369 | 224 267 |
| NOK 000 | Note | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|---|
| Operating activities | ||||||
| Profit / loss (-) for the period | -21 466 | -12 890 | -57 812 | -51 042 | -67 644 | |
| Adjustments for: | ||||||
| Depreciation of property, plant and equipment and right-of-use assets |
797 | 453 | 1 709 | 1 309 | 1 877 | |
| Amortisation of intangible assets | 8 | 1 819 | 1 819 | 5 456 | 6 703 | 8 522 |
| Net finance income | -1 626 | -704 | -1 874 | -664 | -1 496 | |
| Equity-settled share-based payments | 3 198 | 1 021 | 5 173 | 3 554 | 4 821 | |
| Other non-cash items | 1 260 | 399 | 1 484 | -431 | -430 | |
| Changes in unrealised net foreign exchange rate | ||||||
| differences/fluctuations | -127 | -32 | 46 | -73 | 143 | |
| Changes in working capital: | ||||||
| Increase (-) in trade and other receivables and prepayments | -1 548 | -234 | -1 523 | 10 384 | 11 925 | |
| Increase (-) in inventories | -3 351 | -5 530 | -24 055 | -19 190 | -28 741 | |
| Decrease (-) in trade and other payables | 10 | -3 820 | -8 626 | -8 624 | -5 663 | 2 574 |
| Changes in provisions and government grants | 4 258 | 4 511 | 2 749 | 5 713 | 3 166 | |
| Interest received | 7 | 430 | 385 | 706 | 1 344 | 2 255 |
| Interest paid | 7 | -61 | -80 | -199 | -253 | -330 |
| Income tax paid | -81 | -49 | -110 | -53 | -242 | |
| Net cash flows used in operating activities | -20 317 | -19 556 | -76 875 | -48 361 | -63 600 | |
| Investing activities | ||||||
| Purchase of property, plant and equipment | -28 | -301 | -109 | -4 764 | -9 202 | |
| Net cash flows used in investing activities | -28 | -301 | -109 | -4 764 | -9 202 | |
| Financing activities | ||||||
| Proceeds from issuance of ordinary shares | 0 | 0 | 148 500 | 0 | 0 | |
| Proceeds from exercise of share options | 287 | 0 | 287 | 254 | 254 | |
| Transaction costs on issue of shares | -23 | 0 | -22 702 | 0 | 0 | |
| Payment of lease liabilities | -262 | -238 | -771 | -700 | -964 | |
| Net cash flows from/(used in) financing activities | 2 | -238 | 125 314 | -446 | -710 | |
| Net increase/decrease in cash and cash equivalents | -20 343 | -20 095 | 48 330 | -53 571 | -73 513 | |
| Effect of exchange rate changes on cash and cash equivalents | -56 | 69 | 194 | 174 | -49 | |
| Cash and cash equivalents at the start of the period | 153 172 | 124 438 | 84 249 | 157 810 | 157 810 | |
| Cash and cash equivalents at the close of the period | 132 772 | 104 413 | 132 772 | 104 413 | 84 249 |
poLight ASA is a public limited liability company. It was founded in 2005 and is incorporated and domiciled in Norway. The address of its registered office is Innlaget 230, 3185 Skoppum, Norway.
poLight offers a patented, proprietary tunable optics technology, starting with its first product, TLens® which replicates "the human eye" experience in autofocus cameras used in devices such as smartphones, wearables, barcode scanners, machine vision systems and various medical equipment. poLight's TLens® enables better system performance and new user experiences due to benefits such as extremely fast focus, small footprint, no magnetic interference, low power consumption and constant field of view. poLight is based in Horten, Norway, with employees in Finland, France, UK, US, China, Taiwan and the Philippines. For more information, please visit https://www.polight.com.
The interim condensed consolidated financial statements for the quarter ended 30 September 2023 are unaudited and have been prepared in accordance with IAS 34. These interim condensed consolidated financial statements do not include all the information required for the full annual financial statements of the Group and should be read in conjunction with the consolidated financial statements for 2022.
These interim consolidated financial statements have been prepared on a historical cost basis, are presented in Norwegian kroner (NOK) and all values are rounded to the nearest thousand (NOK 000), except when otherwise indicated.
The accounting policies adopted in the preparation of these interim condensed consolidated financial statements are consistent with the consolidated financial statements for the year ended 31 December 2022.
Management makes accounting judgements on development costs. Key significant estimates are made regarding impairment of intangible assets, inventory obsolescence and the accounting for share option plans, described in the Consolidated Financial Statements for the year ended 31 December 2022.
| Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|
| 17 560 | 10 692 | 45 739 | 31 446 | 45 614 |
| 2 616 | 2 271 | 7 165 | 8 013 | 10 400 |
| 5 497 | 3 816 | 15 982 | 18 000 | 21 663 |
| 25 673 | 16 780 | 68 886 | 57 459 | 77 676 |
1) Including consultants engaged on long-term contracts
| (in NOK 000) | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|
| Employee 2) benefits expense | 5 596 | 5 110 | 18 368 | 16 283 | 22 878 |
| Other operating expenses | 2 754 | 2 582 | 7 752 | 12 341 | 14 922 |
| Government grants | -355 | -517 | -1 864 | -1 844 | -4 892 |
| Total | 7 995 | 7 175 | 24 255 | 26 779 | 32 907 |
2) Including consultants engaged on long-term contracts
| (in NOK 000) | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|
| Net foreign exchange gain (loss) | 168 | 151 | -987 | -655 | -385 |
| Interest income | 1 525 | 632 | 3 069 | 1 572 | 2 249 |
| Interest expense on lease liabilities | -61 | -80 | -199 | -253 | -330 |
| Financial expenses | -6 | 1 | -9 | -1 | -38 |
| Net financial items | 1 626 | 704 | 1 874 | 664 | 1 496 |
| (in NOK 000) | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|
| At the start of the period | 21 217 | 28 492 | 24 855 | 33 377 | 33 377 |
| Amortisation | -1 819 | -1 819 | -5 456 | -6 703 | -8 522 |
| At the close of the period | 19 399 | 26 673 | 19 399 | 26 673 | 24 855 |
poLight's operations constitute one single cash generating unit (CGU) for impairment assessment purposes, the TLens® technology platform. Indicators of impairment of the TLens® technology have been assessed, and none identified.
| (in NOK 000) | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | FY 2022 |
|---|---|---|---|---|---|
| Net receivables at the start of the period | 6 123 | 6 077 | 4 614 | 7 280 | 7 280 |
| Grants received | -4 614 | -5 028 | -4 614 | -7 558 | -7 558 |
| Released to the statement of profit and loss | 355 | 517 | 1 864 | 1 844 | 4 892 |
| Net receivables at the close of the period | 1 864 | 1 566 | 1 864 | 1 566 | 4 614 |
| (in NOK 000) | Q3 2023 | Q3 2022 | FY 2022 |
|---|---|---|---|
| Trade payables | 5 546 | 4 539 | 10 612 |
| Other payables | 6 558 | 5 853 | 7 923 |
| Accrued employer's NICs on share option plan | 1 752 | 3 852 | 3 945 |
| At the close of the period | 13 857 | 14 244 | 22 480 |
poLight ASA is the ultimate parent company. None of the shareholders of poLight ASA has control of the company. As at 30 September 2023, the largest shareholder was Investinor Direkte AS, which owned 13.44 per cent of the company's shares.
Intercompany agreements are entered into with all group subsidiaries. All sales by the subsidiaries are made to the parent company. All transactions are performed on an arm's length basis. No transactions have been undertaken with other related parties during the relevant financial period.
No significant events have occurred after the reporting date that have a material effect on the financial statements.
poLight uses the following alternative performance measures for interim and annual financial reporting, in order to provide a better understanding of the Group's underlying financial performance:
EBITDA Earnings before interest, taxes, depreciation and amortisation. EBITDA ex share options EBITDA excluding share option plan expense incl. changes in accrued employer's NICs EBIT Earnings before interest and taxes EBIT ex share options EBIT excluding share option plan expense incl. changes in accrued employer's NICs
poLight ASA Innlaget 5 NO-3185 Skoppum, Norway E-mail: [email protected]
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