Microvision Reports First Quarter 2006 Financial Results

Microvision Reports First Quarter 2006 Financial Results

REDMOND, Wash.--(BUSINESS WIRE)--May 11, 2006--Microvision, Inc. (Nasdaq:MVIS - News), a leader in light scanning technologies, today announced consolidated financial results for the first quarter of 2006. Revenues for the first quarter of 2006 were $2.5 million, down 38% from $4.0 million reported for the first quarter of the prior year. Revenues were lower due to lower contract revenue resulted from the completion of several contract development efforts in 2005 The operating loss for the first quarter increased 20% to $6.7 million compared to $5.5 million in the first quarter of 2005, however the 2006 number included $493,000 in severance costs relating to the company's restructuring plan and $416,000 of non-cash compensation expense associated with the company's adoption of FASB 123®, Share Based Payment, on January 1, 2006. The company reported net income available for common shareholders of $331,000, or $.01 per share, compared to a net loss available for common shareholders of $7.2 million, or ($.33) per share for the first quarter of 2005. Income in the first quarter of 2006 includes a $7.3 million gain on investments from the sale of 2.55 million shares of the company's holdings in Lumera Corporation.
The company ended the quarter with $7.0 million in cash. At March 31, 2006 the company had a backlog of $1.4 million which was comprised of $1.3 million related to development contracts and $92,000 related to product sales.

Highlights

Record quarter for unit shipments of the Flic bar code scanner; first quarter shipments of 9,300 units equaled almost half of the total volume shipped for the full year of 2005;
Improved cash position by raising $10.3 million through the sale of 2.55 million shares of its Lumera Corporation common stock that resulted in a $7.3 million gain being recognized in income for the first quarter;
Completed an organizational restructuring and realignment as part of its 2006 turnaround;
Completed the transformation of the management team and began the reconstitution of its Board of Directors;
Defined and began executing a new financing strategy consistent with its new operating strategy; and
Made demonstrable progress in defining the development of requirements for the Integrated Photonics Module ("IPM") - an embedded engine to fuel high volume display and imaging applications.
"Our first quarter efforts have been focused on implementing several key organizational initiatives aimed at beginning to turn around the company and position it for long term, sustainable growth," said Alexander Tokman, Microvision President and CEO. "We've completed an organizational realignment consistent with the new business strategy and added new talent to lead the critical business functions. We've also implemented a new reward and recognition system for employees aimed at promoting professional excellence.

"Despite a relatively short time period for implementing changes, we are already seeing important signs of turnaround, specifically relating to growth of product sales. Flic had a record first quarter for unit shipments equaling nearly half of the total volume shipped for the entire year of 2005, positioning the product for what we believe will be a strong year. Growing our contract revenue funnel is of top priority and we continue to work towards the goal of signing a strategic Tier 1 and OEM partners for the development and commercialization of automotive head-up display and embedded personal projection display products."