Press release

NUBURU Inc. Announces Fourth Quarter and Full Year 2022 Financial Results

0
Sponsored by Businesswire

NUBURU Inc. (“NUBURU” or the “Company”) (NYSE American: BURU), a leading innovator in high-power and high-brightness industrial blue laser technology, today announced its financial results for the fourth quarter and the fiscal year ended December 31, 2022.

“We ended 2022 on a high note as we began making deliveries under our previously announced contracts with Essentium and AFWERX. We have begun 2023 with the business momentum to pursue our near-term commercial and operational objectives as we completed our business combination and our listing on the NYSE American exchange and we continue to ship lasers systems,” said Dr. Mark Zediker, CEO and Co-Founder of NUBURU. “We also launched our latest product, the NUBURU BL™-Series at the recent Photonics West show, which we expect will further enhance our competitive position in today’s market with shipments beginning in Q2.”

Dr. Zediker added, “These recent milestones further validate the potential for our solutions in metal processing in attractive end markets such as 3D printing, aerospace, consumer electronics and e-mobility for the world’s transportation needs. NUBURU is increasingly well positioned in key market segments where innovative technology is most useful and appreciated.”

Fourth Quarter and Full Year Financial Highlights (Unaudited)

Three Months Ended

December 31,

$ Change

% Change

($ in thousands)

2022

 

2021

 

 

 

Revenue $

435

 

$

62

 

$

373

 

601.6

%

Total gross margin

(771

)

(689

)

(82

)

11.9

%

EBITDA⁽¹⁾

(3,859

)

(2,505

)

(1,354

)

54.1

%

Capital expenditures

(254

)

(110

)

(144

)

130.9

%

Free cash flow⁽¹⁾

(3,194

)

(1,943

)

(1,251

)

64.4

%

 
 

Year Ended

December 31,

$ Change

% Change

($ in thousands)

2022

 

2021

 

Revenue $

1,440

 

$

377

 

$

1,063

 

282.0

%

Total gross margin

(3,419

)

(1,390

)

(2,029

)

146.0

%

EBITDA⁽¹⁾

(13,547

)

(8,838

)

(4,709

)

53.3

%

Capital expenditures

(536

)

(426

)

(110

)

25.8

%

Free cash flow⁽¹⁾

(10,764

)

(8,233

)

(2,531

)

30.7

%

______________

(1)

EBITDA and Free cash flow are non-GAAP financial measures. See “Use of Non-GAAP Financial Measures” below for our definitions of, and additional information about, EBITDA and Free cash flow and for a reconciliation to the most directly comparable U.S. GAAP financial measures.

“Our fourth quarter and full year 2022 results highlight the continuation of our commercialization efforts. Despite the difficult market conditions, we are pleased to have successfully completed our business combination, which we believe has positioned us well for continued growth in our target markets,” stated Brian Knaley, CFO of NUBURU. “While we are pleased with our recent performance, we are also extremely excited about our future prospects, and we plan to provide the market with updated financial guidance in March 2023.”

Recent Business Highlights

  • NUBURU completed its business combination resulting in NUBURU becoming a publicly listed company on the NYSE American exchange.
  • NUBURU announced the BL-Series Launch at Photonics West in January 2023. The BL-Series lasers are designed as easy-to-service packages that can readily integrate with scanners and beam delivery systems.
  • NUBURU has delivered multiple laser systems to Essentium for qualification into their metal additive manufacturing system.
  • NUBURU continues to deliver upon milestones per the previously announced contract with the U.S. Air Force’s AFWERX. These milestones included delivery of multiple systems to the AFWERX sponsored additive program.
  • With the closing of the business combination, NUBURU expanded its board to include diverse and seasoned directors with the requisite public company experience to advise on NUBURU’s entrance to the public markets and the execution of its growth plans.

About NUBURU

Founded in 2015, NUBURU is a developer and manufacturer of industrial blue lasers that leverage fundamental physics and their high-brightness, high-power design to produce faster, higher quality welds and parts than current lasers can provide in laser welding and additive manufacturing of copper, gold, aluminum and other industrially important metals. NUBURU’s industrial blue lasers produce minimal to defect-free welds that are up to eight times faster than the traditional approaches — all with the flexibility inherent to laser processing.

Use of Non-GAAP Financial Measures

In this press release, the Company includes EBITDA and Free cash flow, which are non-GAAP performance measures that the Company uses to supplement its results presented in accordance with U.S. GAAP. As required by the rules of the United States Securities and Exchange Commission (“SEC”), the Company has provided herein a reconciliation of the non-GAAP financial measures contained in this press release to the most directly comparable measures under GAAP. In addition to the Company’s results determined in accordance with GAAP, the Company’s management believes these non-GAAP measures are useful in evaluating its operational performance. The Company’s management uses these non-GAAP financial information to evaluate the Company’s ongoing operations and for internal planning and forecasting purposes. The Company’s management believes that non-GAAP financial information, when taken collectively and in context, may be helpful to investors in assessing the Company’s operating performance and trends and in comparing the Company’s financial measures with those of comparable companies that may present similar non-GAAP financial measures.

EBITDA and Free Cash Flow

The Company defines “EBITDA” as income (loss), plus (minus) depreciation and amortization expenses, plus (minus) interest, plus (minus) taxes and “Free cash flow” as net cash from (used in) operating activities less capital expenditures. EBITDA and Free cash flow are intended as supplemental measures of the Company’s performance that are neither required by, nor presented in accordance with, GAAP and these measures should not be considered a substitute for net income (loss), and net cash used in operating activities reported in accordance with GAAP. The Company’s computation of EBITDA and Free cash flow may not be comparable to other similarly titled measures computed by other companies, because all companies may not calculate EBITDA or Free cash flow in the same fashion.

Limitations of Non-GAAP Financial Measures

There are a number of limitations related to EBITDA, including the following:

  • EBITDA excludes certain recurring, non-cash charges, such as depreciation of property and equipment and/or amortization of intangible assets. While these are non-cash charges, the Company may need to replace the assets being depreciated and amortized in the future and EBITDA does not reflect cash requirements for these replacements or new capital expenditure requirements.
  • EBITDA does not reflect interest expense, net, which may constitute a significant recurring expense in the future.
  • Free cash flow does not reflect the impact of equity or debt raises or repayment of debt or dividends paid.

Because of these and other limitations, EBITDA and Free cash flow should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. The Company compensates for these limitations by relying primarily on the Company’s GAAP results and using EBITDA and Free cash flow on a supplemental basis. You should review the reconciliation of the Company’s net loss to EBITDA and net loss to Free cash flow below and not rely on any single financial measure to evaluate the Company’s business.

The Company’s presentation of EBITDA should not be construed as an inference that its future results will be unaffected by unusual or non-recurring items and its presentation of Free cash flow does not necessarily indicate whether cash flows will be sufficient to fund its cash needs.

Forward-Looking Statements

This press release contains certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including certain financial forecasts and projections. All statements other than statements of historical fact contained in this press release may be forward-looking statements. Some of these forward-looking statements can be identified by the use of forward-looking words, including “may,” “should,” “expect,” “intend,” “will,” “estimate,” “anticipate,” “believe,” “predict,” “plan,” “seek,” “targets,” “projects,” “could,” “would,” “continue,” “forecast” or the negatives of these terms or variations of them or similar expressions. All forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. All forward-looking statements are based upon estimates, forecasts and assumptions that, while considered reasonable by NUBURU and its management, are inherently uncertain and many factors may cause the Company’s actual results to differ materially from current expectations which include, but are not limited to: (1) the ability to continue to meet the security exchange’s listing standards; (2) failure to achieve expectations regarding its product development and pipeline; (3) the inability to access sufficient capital to operate as anticipated; (4) the risk that the business combination disrupts current plans and operations of NUBURU as a result of the consummation of the business combination; (5) the inability to recognize the anticipated benefits of the business combination, which may be affected by, among other things, competition, the ability of the Company to grow and manage growth profitably, maintain relationships with customers and suppliers and retain its management and key employees; (6) changes in applicable laws or regulations; (7) the possibility that NUBURU may be adversely affected by other economic, business and/or competitive factors; (8) the inability to obtain financing from Lincoln Park Capital; (9) the impact of the COVID-19 pandemic, including any mutations or variants thereof, and its effect on business and financial conditions; (10) volatility in the markets caused by geopolitical and economic factors; and (11) other risks and uncertainties set forth in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in NUBURU’s Current Report on Form 8-K filed by NUBURU with the Securities and Exchange Commission (the “SEC”) on February 6, 2023, Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2022 filed by NUBURU with the SEC on November 14, 2022 and the business combination proxy statement/prospectus filed by NUBURU with the SEC on December 12, 2022 and other documents filed with the SEC from time to time. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. NUBURU does not give any assurance that it will achieve its expected results. NUBURU assumes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, except as otherwise required by applicable securities laws.

NUBURU Inc.

BALANCE SHEETS

(Unaudited)

 

 

December 31,

 

 

2022

 

 

2021

 

ASSETS

Current assets:

 

 

Cash and cash equivalents

$

2,880,254

 

$

6,007,575

 

Accounts receivable

 

327,200

 

 

223,275

 

Inventories, net

 

972,695

 

 

410,098

 

Deferred financing costs

 

4,258,515

 

 

 

Prepaid expenses and other

 

46,737

 

 

70,073

 

Total current assets

 

8,485,401

 

 

6,711,021

 

 

 

 

Property and equipment, net

 

3,771,849

 

 

3,980,280

 

Construction in progress

 

188,912

 

 

 

Right-of-use assets

 

641,651

 

 

 

Deposits

 

34,359

 

 

34,359

 

TOTAL ASSETS

$

13,122,172

 

$

10,725,660

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY

Current liabilities:

 

 

Accounts payable

$

4,456,587

 

$

221,188

 

Accrued expenses

 

2,312,118

 

 

646,863

 

Operating lease liability

 

343,049

 

 

 

Contract liabilities

 

178,750

 

 

173,050

 

Convertible notes payable

 

7,300,000

 

 

 

Total current liabilities

 

14,590,504

 

 

1,041,101

 

 

 

 

Deferred rent

 

 

 

96,484

 

Operating lease liability, net of current portion

 

373,907

 

 

 

Total liabilities

 

14,964,411

 

 

1,137,585

 

 

 

 

Stockholders’ (deficit) equity:

 

 

Preferred stock

 

 

Series A preferred stock, $0.0001 par value; 12,000,000 shares authorized, 8,000,000 issued and outstanding; aggregate liquidation preference of $11,707,559 and $11,227,559 at December 31, 2022 and 2021, respectively

 

800

 

 

800

 

Series A‑1 preferred stock, $0.0001 par value; 3,520,914 shares authorized, 3,478,263 issued and outstanding; aggregate liquidation preference of $5,669,728 and $5,429,728 at December 31, 2022 and 2021, respectively

 

348

 

 

348

 

Series B preferred stock, $0.0001 par value; 4,000,000 shares authorized, 3,123,088 issued and outstanding; aggregate liquidation preference of $20,547,599 and $19,610,673 at December 31, 2022 and 2021, respectively

 

312

 

 

312

 

Series B‑1 preferred stock, $0.0001 par value; 24,625,000 shares authorized, 24,625,000 issued and outstanding; aggregate liquidation preference of $22,513,127 and $21,331,127 at December 31, 2022 and 2021, respectively

 

2,463

 

 

2,463

 

Series C preferred stock, $0.0001 par value; 1,166,372 shares authorized, 1,166,372 and 1,128,594 issued and outstanding as of December 31, 2022 and 2021, respectively; aggregate liquidation preference of $12,030,361 and $11,303,062 at December 31, 2022 and 2021, respectively

 

117

 

 

113

 

Common stock, $0.0001 par value; 72,000,000 shares authorized, 10,782,091 and 9,999,051 shares issued and outstanding as of December 31, 2022 and 2021, respectively

 

1,077

 

 

999

 

Additional paid‑in capital

 

59,344,952

 

 

56,646,247

 

Accumulated deficit

 

(61,192,308

)

 

(47,063,207

)

Total stockholders’ (deficit) equity

 

(1,842,239

)

 

9,588,075

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY

$

13,122,172

 

$

10,725,660

 

 

 

 

NUBURU Inc.

STATEMENT OF OPERATIONS

(Unaudited)

 

 

Year Ended December 31,

 

 

2022

 

 

2021

 

 

 

 

Net revenues

$

1,440,428

 

$

376,665

 

 

 

 

Cost of revenues

 

 

Materials

 

472,440

 

 

24,605

 

Direct labor

 

1,742,796

 

 

570,432

 

Direct job costs

 

2,391,796

 

 

822,509

 

Overhead

 

252,567

 

 

348,723

 

 

 

 

Total cost of revenues

 

4,859,599

 

 

1,766,269

 

 

 

 

Gross deficit

 

(3,419,171

)

 

(1,389,604

)

 

 

 

Operating expenses

 

 

Research and development

 

4,546,057

 

 

2,463,307

 

Sales and marketing

 

708,144

 

 

1,647,552

 

General and administrative

 

5,324,417

 

 

3,884,677

 

 

 

 

Total operating expenses

 

10,578,618

 

 

7,995,536

 

 

 

 

Loss from operations

 

(13,997,789

)

 

(9,385,140

)

 

 

 

Other income (expense)

 

 

Interest income

 

43,976

 

 

1,165

 

Interest expense

 

(175,288

)

 

 

 

 

 

Total other income (expense)

 

(131,312

)

 

1,165

 

 

 

 

Net loss and comprehensive loss

$

(14,129,101

)

$

(9,383,975

)

 

 

 

Net loss available to common stockholders

$

(17,317,546

)

$

(12,240,023

)

 

 

 

Net loss per common share – basic and diluted

$

(1.64

)

$

(1.23

)

 

 

 

Weighted average common shares outstanding – basic and diluted

 

10,590,335

 

 

9,973,846

 

 

NUBURU Inc.

STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

Year Ended December 31,

 

 

2022

 

 

2021

 

 

 

 

Cash flows from operating activities

 

 

Net loss

$

(14,129,101

)

$

(9,383,975

)

Adjustments to reconcile net loss to cash used in operating activities:

 

 

Depreciation and amortization

 

450,505

 

 

546,944

 

Share based compensation expense

 

2,362,340

 

 

441,367

 

Loss on disposal of property and equipment

 

 

 

147,469

 

Excess and obsolete inventory reserve adjustments

 

(590,137

)

 

236,748

 

Inventory lower of cost and net realizable value adjustments

 

332,021

 

 

329,331

 

Changes in operating assets and liabilities:

 

 

Inventories

 

(199,429

)

 

(234,503

)

Accounts Receivable

 

(103,925

)

 

(170,275

)

Prepaid expenses and other

 

23,336

 

 

(45,813

)

Operating lease right-of-use asset

 

292,932

 

 

 

Accounts payable

 

628,702

 

 

(24,147

)

Accrued expenses

 

1,013,437

 

 

223,631

 

Contract liabilities

 

5,700

 

 

137,274

 

Operating lease liability

 

(314,111

)

 

 

Deferred rent

 

 

 

(10,846

)

 

 

 

Net cash used in operating activities

 

(10,227,730

)

 

(7,806,795

)

 

 

 

Cash flows from investing activities

 

 

Proceeds from the sale of property and equipment

 

 

 

195,492

 

Purchases of property and equipment

 

(536,038

)

 

(426,445

)

 

 

 

Net cash used in investing activities

 

(536,038

)

 

(230,953

)

 

 

 

Cash flows from financing activities

 

 

Proceeds from issuance of convertible promissory note

 

7,300,000

 

 

 

Proceeds from issuance of common stock ‑ options exercised

 

147,557

 

 

7,800

 

Proceeds from issuance of preferred stock

 

188,890

 

 

5,642,970

 

 

 

 

Net cash provided by financing activities

 

7,636,447

 

 

5,650,770

 

 

 

 

Net decrease in cash and cash equivalents

 

(3,127,321

)

 

(2,386,978

)

 

 

 

Cash and cash equivalents, beginning of period

 

6,007,575

 

 

8,394,553

 

 

 

 

Cash and cash equivalents, end of period

$

2,880,254

 

$

6,007,575

 

 

 

 

Supplemental non-cash flow investing and financing activities:

 

 

Right-of-use asset obtained in exchange for new operating lease liability

$

934,583

 

$

 

Deferred financing costs included in accounts payable and accrued expenses

$

4,258,515

 

$

 

 

 

 

Reconciliation of Non-GAAP Financial Measures:

The following tables reconcile the Company’s net loss (the most directly comparable GAAP measure to EBITDA) to EBITDA for the periods presented and the Company’s net cash used in operating activities (the most directly comparable GAAP measure to Free Cash Flow) to Free cash flow for the periods presented:

Three Months Ended
December 31,
($ in thousands)

 

2022

 

 

2021

 

Net loss

$

(4,022

)

$

(2,644

)

Income tax expense

 

 

 

 

Interest (Income) expense, net

 

93

 

 

 

Depreciation and amortization

 

70

 

 

139

 

EBITDA

 

(3,859

)

 

(2,505

)

 
Three Months Ended
December 31,
($ in thousands)

 

2022

 

 

2021

 

Net cash used in operating activities

$

(2,940

)

$

(1,833

)

Capital expenditures

 

(254

)

 

(110

)

Free cash flow

 

(3,194

)

 

(1,943

)

Year Ended
December 31,
($ in thousands)

 

2022

 

 

2021

 

Net loss

$

(14,129

)

$

(9,384

)

Income tax expense

 

 

 

 

Interest (Income) expense, net

 

131

 

 

(1

)

Depreciation and amortization

 

451

 

 

547

 

EBITDA

 

(13,547

)

 

(8,838

)

 
Year Ended
December 31,
($ in thousands)

 

2022

 

 

2021

 

Net cash used in operating activities

$

(10,228

)

$

(7,807

)

Capital expenditures

 

(536

)

 

(426

)

Free cash flow

 

(10,764

)

 

(8,233

)