Sigma Labs Reports Second Quarter 2019 Financial Results

SANTA FE, N.M., Aug. 14, 2019 (GLOBE NEWSWIRE) -- Sigma Labs, Inc. (NASDAQ: SGLB) (“Sigma Labs”), a leading provider of quality assurance software to the commercial 3D printing industry, reported its financial and operational results for the second quarter ended June 30, 2019.

Key Second Quarter 2019 and Subsequent Highlights

  • Selected by a major international OEM machine manufacturer to deploy two PrintRite3D® quality assurance software programs as part of an evaluation process for a broader rollout.
     
  • Selected by Airbus ( AIR:FP / OTC: EADSY), a global leader in aeronautics, space and related services to deploy the PrintRite3D version 5.0 software product into a laser powder bed printer as part of a testing and evaluation program ahead of a larger potential commercial rollout throughout the Airbus organization.
     
  • Partnered with Materialise NV (NASDAQ: MTLS), a leading provider of additive manufacturing software and 3D printing solutions, and as a result of being Sigma’s first RTE installation, entered an agreement to integrate Sigma Labs’ proprietary PrintRite3D software solution into Materialise’s embedded hardware solution.
     
  • Launched the breakthrough PrintRite3D® version 5.0 quality assurance software at the RAPID+TCT 3D Printing and Additive Manufacturing Conference in May 2019, a step-change software update featuring real-time melt pool analytics with automated anomaly detection, enabling exciting new industrial-scale applications of the company’s software.
     
  • Realized third-party validation of Sigma Labs’ proprietary PrintRite3D® quality assurance software through a Defense Advanced Research Project Agency (DARPA) research study conducted in collaboration with Honeywell Aerospace.
     
  • Fortified our balance sheet through a $2.3 million underwritten public offering of common stock in August 2019 to advance commercialization efforts of its proprietary quality assurance software products.
     
  • Appointed Frank D. Orzechowski as Chief Financial Officer effective July 1, 2019. The 30-year financial and operational veteran has led large teams through significant corporate transactions, including mergers and acquisitions, financings and other transactions during his career.
     
  • Presented at multiple investor and industry conferences to strengthen the company’s commercial and investor presence, including:
     

Management Commentary

“The second quarter of 2019 was highlighted by sustained commercialization efforts, as we continue to make meaningful progress towards integrating our proven quality assurance technology into innovative new applications in the multi-billion-dollar industrial 3D printing market,” said John Rice, Chief Executive Officer of Sigma Labs.

“Our focus remains on four key areas:

  1. Product Development: Making our proprietary PrintRite3D software increasingly simple to use for our customers and integrating it into exciting new end-user applications, as demonstrated with our version 5.0 which integrated an improved user interface as well as other exciting new capabilities, transforming it into a readily usable software product.
     
  2. Securing New Evaluation Programs: As with our recently announced Airbus partnership to evaluate our PrintRite3D version 5.0 software for a broader rollout, we continue to seek placements with top-tier manufacturers, allowing them to ‘test drive’ our software, demonstrating the clear value and making a wider-scale purchase more likely.
     
  3. Negotiating OEM Transactions: As part of our broader vision for the company, our goal is to have PrintRite3D deployed into the marketplace directly from the factory, coming pre-installed on new machines. We will continue to make a strong push at all the original equipment manufacturers to establish long-term OEM partner agreements to integrate PrintRite3D into their machines, adding value both for Sigma Labs shareholders and their end-customers who will experience better overall manufacturing quality.
     
  4. Preserving Shareholder Value: We recently announced the completion of a $2.3 million public offering of common stock, which fortifies our balance sheet and, through our capital-light operating model and disciplined approach to capital allocation, brings Sigma Labs much closer to a profitable entity. We seek to minimize dilution wherever possible and constantly seek out new ways to build long-term value for our shareholders.             

“Our core software product, proven out and vetted through case studies with DARPA and Honeywell Aerospace, addresses significant unmet market challenges facing the 3D metal printing industry. I believe we are on the cusp of realizing key operational milestones that position us for a memorable year and look forward to creating long-term value for our shareholders as we continue our steady pace of operational execution.

“Given the recent momentum, new CFO appointment, and to increase our transparency with the investor community, we will be returning to a regular cadence of quarterly conference calls commencing with third quarter of 2019 financial results in early November. We look forward to sharing more on our developing story at upcoming industry conferences in Austin, Texas and Frankfurt, Germany and soon to be announced investor conferences in 2019,” concluded Rice.

Second Quarter 2019 Financial Results

Revenue for the second quarter of 2019 decreased 66% to $33,582, as compared to $98,663 in the second quarter of 2018. This decrease is primarily attributable to the 100% dedication of our printer to Internal R&D in the second quarter of 2019 as we accelerated development of the Inspect product, as well as an overall decline in AM revenue.

Gross profit in the second quarter of 2019 decreased to negative $27,043, as compared to $30,095, or 30.5% of revenues, in the second quarter of 2018. The decrease in our gross margin is primarily attributable to the additional travel and labor costs associated with the on-site and remote collaboration involved in initiation of the company’s Rapid Test and Evaluation programs.

Total operating expenses were $1.6 million in the second quarter of 2019, as compared to $1.4 million in the second quarter of 2018.  

Net loss in the second quarter of 2019 totaled $1.6 million, or $(0.15) per share, compared to a net loss of $1.4 million, or $(0.25) per share, in the second quarter of 2018.

Cash totaled $0.7 million at June 30, 2019, as compared to $1.9 million at March 31, 2019. Subsequent to the closing of the second quarter of 2019, Sigma Labs completed a $2.3 million public offering of common stock.

About Sigma Labs
Sigma Labs, Inc. (NASDAQ: SGLB) is a leading provider of quality assurance software to the commercial 3D printing industry under the PrintRite3D® brand. Founded in 2010, Sigma is a software company that specializes in the development and commercialization of real-time computer aided inspection (CAI) solutions known as PrintRite3D® for 3D advanced manufacturing technologies. Sigma Labs’ advanced computer-aided software product revolutionizes commercial additive manufacturing, enabling non-destructive quality assurance mid-production, uniquely allowing errors to be corrected in real-time. 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 which may cause the Company's actual results, performance or achievements to be materially different from any anticipated results, performance or achievements. 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 the Company’s Annual Report on Form 10-K (including but not limited to the discussion under “Risk Factors” therein) filed with the SEC on April 1, 2019 and which may be viewed at  http://www.sec.gov .

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