LASE Corp 10-Q for FY2022 Q3

LASE Corp. (LASE)

10-Q 2022-11-14 For: 2022-09-30

Added on April 11, 2026

About this 10-Q

LASE Corp filed this 10-Q on November 14, 2022, covering the quarter ended September 30, 2022 (FY2022 Q3).

Headline figures

Quarter ended September 30, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $1.22M; up 11.5% from $1.1M a year earlier
Net income: $205.09K; up 29.3% from net income of $158.67K a year earlier
Diluted EPS: $0.04; up 33.3% from $0.03 a year earlier

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Delaware		84-3628771
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller reporting Company	☒
		Emerging growth company	☒

		Page No.
PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements	3

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26

Item 4.	Controls and Procedures	26

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	27

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	27

Item 3.	Defaults Upon Senior Securities	27

Item 4.	Mine Safety Disclosures	27

Item 5.	Other Information	27

Item 6.	Exhibits	27

Signatures		29

Certifications

	September 30, 2022		December 31, 2021
	Unaudited
Assets
Current Assets:
Cash and Cash Equivalents	$	231,986	$	615,749
Accounts Receivable, Net		1,248,045		84,365
Inventory		1,682,472		1,790,952
Total Current Assets		3,162,504		2,491,066

Other Assets		10,568		3,000

Property, Plant, & Equipment, Net		619,069		698,580

Intangible Assets, Net		2,995,846		3,167,945

Operating Lease Right-of-Use Asset		371,581		499,758

Total Assets	$	7,159,569	$	6,860,350

Liabilities & Stockholders' Equity
Current Liabilities:
Accounts Payable	$	198,304	$	113,443
Deferred Revenue		5,000		91,775
Current Portion of Operating Lease		175,602		171,757
Loans Payable, Current Portion		100,000		-
Sales Tax Payable		18,787		15,456
Total Current Liabilities		497,693		392,431

Long Term Liabilities:
Loans Payable		-		579,012
Operating Lease Liability, less Current Portion		195,979		328,001
Total Long Term Liabilities		195,979		907,013
Total Liabilities		693,673		1,299,444

Commitments and Contingencies (Note 3)

Stockholders' Equity:
Common Stock Par Value $0.01: 100,000,000 shares authorized, 4,878,417 issued and outstanding as of September 30, 2022 and December 31, 2021		48,783		48,783
Additional Paid in Capital		5,242,832		5,242,832
Retained Earnings		1,174,280		269,291
Total Stockholders' Equity		6,465,896		5,560,906
Total Liabilities & Stockholders' Equity	$	7,159,569	$	6,860,350

	3 Months Ending September 30,						9 Months Ending September 30,
	2022			2021			2022			2021

Net Sales	$	1,224,450		$	1,098,590		$	3,790,176		$	2,989,106
Cost of Sales		513,163			453,438			1,504,080			1,217,731
Gross Profit		711,287			645,152			2,286,096			1,771,375

Operating Expenses:
Sales & Marketing		74,266			93,279			251,024			285,565
General & Administrative		323,253			186,474			839,969			507,113
Depreciation & Amortization		84,853			98,640			258,894			295,919
Total Operating Expenses		482,372			378,393			1,349,887			1,088,597
Operating Income		228,915			266,759			936,209			682,779

Other Income (Expenses):
Interest Expense		(10,000	)		(10,847	)		(24,426	)		(43,300	)
Other Income		-			(97,245	)		7,031			(97,245	)
Total Other Income (Expense)		(10,000	)		(108,092	)		(17,394	)		(140,545	)
Income (Loss) Before Tax		218,915			158,667			918,815			542,234
Tax Provision		13,825			-			13,825			68
Net Income	$	205,089		$	158,667		$	904,990		$	542,166

Income per Share:
Basic	$	0.04		$	0.03		$	0.19		$	0.11
Fully Diluted	$	0.04		$	0.03		$	0.19		$	0.11

Weighted Average Shares Outstanding (September 30, 2021 is reflective of a 1/6 reverse stock split):
Basic		4,878,417			4,878,417			4,878,417			4,878,417
Fully Diluted		4,895,084			4,878,417			4,883,973			4,878,417

					Additional
	Common Stock				Paid In		Accumulated		Stockholders’
	Shares		Amount		Capital		Deficit		Equity Total
Balance, January 1, 2022 after 1/6 split. 100,000,000 authorized at 0.001		4,878,417	$	48,783	$	5,242,832	$	269,290	$	5,560,906

Net income for the nine months ended September 30, 2022		-		-		-		904,990		904,990

Balance, September 30, 2022		4,878,417	$	48,783	$	5,242,832	$	1,174,280	$	6,465,896

	September 30, 2022		December 31, 2021
Inventory
Equipment Parts Inventory		789,060		731,863
Finished Goods Inventory		195,239		161,918
Sales Demo Inventory		647,790		885,514
Work in process Inventory		50,384		11,657
Total Inventory		1,682,472		1,790,952

Category		Economic Useful Life
Office furniture and fixtures		3-5 years
Machinery and equipment		5-7 years
Intangible Assets		7-12 years

	September 30, 2022			December 31, 2021
Capital Assets
Equipment and Furniture
Accumulated Depreciation		(269,126	)		(186,526	)
Machinery & Equipment		797,695			797,695
Office and Computer Equipment		11,509			8,420
Office Furniture		31,029			31,029
R&D Equipment		37,973			37,973
Vehicles		9,989			9,989
Total Capital Assets		619,069			698,580

Intangible Assets	June 30, 2022			December 31, 2021
Accumulated Amortization		(412,424	)		(236,130	)
Customer Relationships		211,000			211,000
Equipment Design Documentation		2,675,000			2,675,000
Operational Software & Website		305,470			301,275
Trademarks		216,800			216,800
Total Intangible Assets		2,995,846			3,167,945

	For the Nine Months Ending September 30,
	2022			2021
Net cash provided by Operating Activities		102,532			333,875
Net cash provided by Investing Activities		(7,284	)		(12,665	)
Net cash provided by Financing Activities		(479,012	)		(52,819	)

	☐	Level 1 - quoted market prices in active markets for identical assets or liabilities.

	☐	Level 2 - inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

	☐	Level 3 - unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

	For the Nine Months ending September 30,
	2022			2021
Net cash provided by Operating Activities		102,532			333,875
Net cash provided by Investing Activities		(7,284	)		(12,665	)
Net cash provided by Financing Activities		(479,012	)		(52,819	)

2022	$	43,580

2023	$	176,909

2024	$	151,092

Deferred rent	$	-

Total lease payments	$	371,581

Less imputed interest	$	-

Total	$	371,581

	Three Months ending September 30,
	2022		2021
Revenue		1,224,450		1,098,590

	9 Months Ending September 30,
	2022			2021
Cash Flows From:
OPERATING ACTIVITIES
Net Income (Loss)	$	904,990		$	542,166
Adjustments to Reconcile Net Income (Loss) to Net Cash Flow from Operating Activities:
Depreciation & Amortization		258,894			295,919
Net Change, Right-of-Use Asset & Liabilities		-			(28,755	)
Change in Operating Assets & Liabilities:
Accounts Receivable		(1,163,680	)		(533,658	)
Inventory		108,480			229,896
Prepaids & Other Current Assets		(7,568	)		-
Accounts Payable		84,861			(39,331	)
Customer Deposits		(86,775	)		(128,783	)
Sales Tax Payable		3,331			(3,579	)
Net Cash From (Used In) Operating Activities		102,532			333,875

INVESTING ACTIVITIES
Purchase of Equipment		-			(2,750	)
Purchase of Computers		(3,089	)		-
Purchase of R&D Equipment		-			(6,920	)
Purchase of Intangible Assets		(4,195	)		(2,995	)
Net Cash From (Used In) Investing Activities		(7,284	)		(12,665	)

FINANCING ACTIVITIES
Proceeds from (Repayment of) Notes		(161,684	)		(251,569	)
Proceeds from (Repayment of) PPP Loan		(317,328	)		198,750
Net Cash From (Used In) Financing Activities		(479,012	)		(52,819	)
Net Cash Flow for Period	$	(383,763	)	$	268,391
Cash - Beginning of Period		615,749			326,713
Cash - End of Period	$	231,986		$	595,105

SUPPLEMENTARY CASH FLOW INFORMATION
Cash Paid During the Period for:
Income Taxes	$	13,825		$	68
Interest	$	24,426		$	43,300

	•	identification of a contract with a customer;
	•	identification of the performance obligations in the contact;
	•	determination of the transaction price;
	•	allocation of the transaction price to the separate performance allocation; and
	•	recognition of revenue when performance obligations are satisfied.

	Nine Months ending September 30,
	2022		2021
Revenue		3,790,176		2,989,106

	3 Months Ending				9 Months Ending
	September 30,				September 30,
	2022		2021		2022		2021
Other financial data (unaudited):
EBITDA⁽¹⁾	$	313,767	$	268,153	$	1,202,134	$	881,453
Adjusted EBITDA⁽²⁾	$	313,767	$	268,153	$	1,202,134	$	881,453

	•	Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;

	•	Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

	•	Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

	•	In January 2021, we launched a comprehensive management software system that is initially being utilized to track sales orders, purchase orders and inventory. This system is scalable, and we plan to expand this system and integrate this with our accounting systems to strengthen our internal controls and disclosure controls and procedures.

	•	In February 2022, we engaged MKA CPAs & Advisors, a regional advisory firm that provides outsourced accounting services, to assist us with month end closing activities and financial statement preparation, including compilation of monthly and annual balance sheets and statements of operations, in accordance with Statements on Standards for Accounting Review Services promulgated by the AICPA.

	•	In April 2022, we engaged CFO Systems, LLC, an outsourced CFO consultancy, to assist with the preparation of, and revisions to, the financial information presented in the Registration Statement, as well as to implement any improvements or enhancements to such financial information as incorporated into our periodic reports, such as this Form 10-Q.

	•	In July 2022, we hired for the first time a Vice President of Finance with extensive financial planning and reporting experience in manufacturing and distribution, including larger public Company settings, to serve as both our Principal Accounting Officer and Principal Financial Officer. Recently promoted to CFO, he establishes strict financial reporting leadership and assumes responsibility for the development of a comprehensive system of reporting controls, including the onboarding of additional specialized accounting expertise as the business grows and evolves.

	•	We plan to use a portion of the proceeds of the IPO to expand our financial reporting group, provide training on public Company financial reporting to relevant personnel, and to enhance our accounting systems, as mentioned in the previous bullets.

31.1		Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer

31.2		Rule 13(a)-14(a)/15(d)-14(a) Certification of principal financial and accounting officer

32.1		Section 1350 Certification of principal executive officer

32.2		Section 1350 Certification of principal financial and accounting officer

101*		XBRL data files of Financial Statements and Notes contained in this Quarterly Report on Form 10-Q.

	Laser Photonics Corporation

Date: November 14, 2022	By:	/s/ Wayne Tupuola
	Name:	Wayne Tupuola
	Title:	President and CEO
		(Principal Executive Officer)

Date: November 14, 2022	By:	/s/ Tim Schick, CFA
	Name:	Tim Schick, CFA
	Title:	CFO
		(Principal Accounting Officer and Principal Financial Officer)

1.	I have reviewed this quarterly report on Form 10-Q of Laser Photonics Corporation (the “registrant”).

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report.

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.

4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 14, 2022	By:	/s/ Tim Schick, CFA
		CFO
		(Principal Financial and Accounting Officer)