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Luna Innovations Incorporated Reports First Quarter 2014 Financial ResultsROANOKE, Va. --(Business Wire)-- Luna Innovations Incorporated (NASDAQ: LUNA) today announced its financial results for the first quarter ended March 31, 2014. Following the sale of its fiber optic shape sensing technology for medical applications in the first quarter of 2014, Luna reported a net income attributable to common stockholders of $8.5 million, or $0.49 per diluted common share, compared to a net income attributable to common stockholders of $2.8 million, or $0.17 per diluted common share for the first quarter of 2013. Net income for the first quarter of 2014 includes an after-tax gain of $9.5 million related to the sale of the medical shape sensing business. Net income for the first quarter of the prior year includes an after tax gain of $4.0 million realized from the sale of the company's secure computing and communications group in March of 2013. Total revenue increased by 9% from $4.1 million in the first quarter of 2013 to $4.5 million in the first quarter of 2014, driven by growth in the company's products and licensing segment, which increased 22% compared to the first quarter of 2013, reflecting increased sales of fiber optic test and measurement products. Technology development revenue also increased by 2% compared to the first quarter of 2013. Gross profit increased to $1.6 million for the first quarter of 2014 compared to $1.1 million for the first quarter of 2013, resulting in an improvement in gross margin to 35% for the first quarter of 2014 compared to gross margin of 28% in the first quarter of 2013. Operating expenses were relatively unchanged at $3.5 million for the first quarter of 2014 compared to $3.4 million for the first quarter of the prior year. The company reported a loss from continuing operations of $1.0 million for the first quarter of 2014, compared to a loss from continuing operations of $1.3 million in the first quarter of 2013. Adjusted EBITDA, a non-GAAP measure, which is earnings before interest, taxes, and non-cash expenses of share-based compensation, depreciation, amortization and warrant expense, improved to $(1.4) million for the first quarter of 2014, as compared to $(1.6) million for the first quarter of 2013. "With the sale of the medical shape sensing business in the first quarter, we significantly improved our liquidity, allowing us to focus on our key growth initiative of fiber optic sensing for strain and temperature," said My Chung, president and chief executive officer. "We ended the first quarter with $10.9 million of cash on hand and in April received the second installment of $6 million from the sale. With this enhanced working capital, we are positioned to continue to expand our sales and marketing and our product development efforts toward the growth of our ODiSI platform for distributed sensing, as well as to pursue future growth opportunities through an ongoing pipeline of technologies within the technology development segment of our business." First Quarter Financial and Business Summary
Non-GAAP Measures In evaluating the operating performance of its business, Luna's management excludes certain charges and credits that are required by generally accepted accounting principles ("GAAP"). These non-GAAP results provide useful information to both management and investors by excluding items that the company believes may not be indicative of its operating performance, because either they are unusual and the company does not expect them to recur in the ordinary course of its business or they are unrelated to the ongoing operation of the business in the ordinary course. These non-GAAP measures should be considered in addition to results and guidance prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. The non-GAAP measures included in this press release have been reconciled to the nearest GAAP measure in the table following the financial statements attached to this press release. Conference Call Information As previously announced, Luna will conduct an investor conference call at 5:00 p.m. (EDT) today to discuss its financial results and business developments for the first quarter of 2014. The call can be accessed by dialing 866-515-2913 domestically or 617-399-5127 internationally prior to the start of the call. The participant access code is 82796803. Investors are advised to dial in at least five minutes prior to the call to register. The conference call will also be webcast live over the Internet. The webcast can be accessed by logging on to the "Investor Relations" section of the Luna website, www.lunainc.com, prior to the event. The webcast will be archived under the "Webcasts and Presentations" section of the Luna website for at least 30 days following the conference call. About Luna: Luna Innovations Incorporated (www.lunainc.com) is a public company composed of scientists, engineers, and business professionals developing and manufacturing a new generation of technologies and products. Luna has been successful in taking innovative technologies from applied research to product development and ultimately to the commercial market, driving breakthroughs in fields such as aerospace, automotive, telecommunications, healthcare, energy, and defense. Forward-Looking Statements: The statements in this release that are not historical facts constitute "forward-looking statements" made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements include our expectations regarding the company's future growth and commercialization of the company's shape sensing platform and other growth opportunities in the company's technology development segment. Management cautions the reader that these forward-looking statements are only predictions and are subject to a number of both known and unknown risks and uncertainties, and actual results, performance, and/or achievements of the company may differ materially from the future results, performance, and/or achievements expressed or implied by these forward-looking statements as a result of a number of factors. These factors include, without limitation, failure of demand for the company's products and services to meet expectations, technological challenges and those risks and uncertainties set forth in the company's periodic reports and other filings with the Securities and Exchange Commission. Such filings are available at the SEC's (News - Alert) website at www.sec.gov and at the company's website at www.lunainc.com. The statements made in this release are based on information available to the company as of the date of this release and Luna undertakes no obligation to update any of the forward-looking statements after the date of this release.
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