Nanophase Reports Fourth Quarter and Fiscal Year 2016 Financial Results - Nanophase Technologies (OTC:NANX)

ROMEOVILLE, Ill., Feb. 15, 2017 (GLOBE NEWSWIRE) -- Nanophase Technologies Corporation NANX, a technology leader in nanomaterials and advanced nanoengineered products, today reported financial results for the fourth quarter and fiscal year ended December 31, 2016.

"2016 demonstrated continued financial growth on the top line and bottom line (from the base business, prior to launch costs for our new fully formulated personal care solutions), and featured our first outright quarterly profit during the second quarter," commented Nanophase CEO and President Jess Jankowski. "And with revenue starting to come in from these new products, we expect continued improvement heading into 2017."

Twelve Months Ended December 31, 2016 Financial Highlights

Revenue for fiscal year 2016 was $10.8 million, vs. the $10.3 million reported during the same period of 2015.
The net loss for fiscal year 2016 was $1.3 million, or a loss of $0.04 per share, compared to a net loss of $1.2 million, or $0.04 per share, for the comparable period of 2015.
The Company finished the quarter with approximately $1.8 million in cash and cash equivalents; the Company had no debt.

Fourth Quarter 2016 Financial Highlights

Revenue for the fourth quarter was $2.4 million in 2016 and $2.3 million in 2015.
The net loss for the quarter was $0.7 million in 2016, or $0.02 per share, compared to a net loss of $0.3 million, or $0.01 per share, for 2015.

Jankowski continued, "We could have simply posted a slightly better result than the prior year, but our plan is to grow the top line significantly more in 2017 than we did during 2016, and we are investing in making that happen. That most of our investment was covered by the business indicates we are moving in the right direction. I believe we have the strategy, the solutions and the positioning to get this done."

Shareholders and members of the financial community are encouraged to participate in the upcoming conference call, where Mr. Jankowski will discuss the company's current and long-term prospects.

Fourth Quarter and Fiscal Year 2016 Conference Call
The Nanophase conference call, to be hosted by Jess Jankowski, the Company's President & CEO, is scheduled for February 16, 2017, at 10:00 a.m. CST, 11:00 a.m. EST. The conference call dial-in number for U.S. callers is 877-312-8776 and for international callers is 408-774-4007. The conference ID is 5824085. Please dial in to the conference at least five minutes before the call is scheduled to begin.

The call may also be accessed through the company's website, at www.nanophase.com, by clicking on Investor Relations, Investor News and the link in the conference call announcement release.

Use of Non-GAAP Financial Information
Nanophase believes that the presentation of results excluding certain items, such as non-cash equity compensation charges, provides meaningful supplemental information to both management and investors, facilitating the evaluation of performance across reporting periods. The Company uses these non-GAAP measures for internal planning and reporting purposes. These non-GAAP measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAP measures used by other companies. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net income or net income per share prepared in accordance with generally accepted accounting principles.

About Nanophase Technologies
Nanophase Technologies Corporation (NANX), www.nanophase.com, is a leader in nanomaterials technologies and provides nanoengineered solutions for multiple industrial product applications. Using a platform of patented and proprietary integrated nanomaterial technologies, the Company creates products with unique performance attributes from two ISO 9001:2008 and ISO 14001 facilities. Nanophase delivers commercial quantity and quality nanoparticles, coated nanoparticles, and nanoparticle dispersions in a variety of media.

Forward-Looking Statements
This press release contains words such as "expects," "shall," "will," "believes," and similar expressions that are intended to identify forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Such statements in this announcement are made based on the Company's current beliefs, known events and circumstances at the time of publication, and as such, are subject in the future to unforeseen risks and uncertainties that could cause the Company's results of operations, performance and achievements to differ materially from current expectations expressed in, or implied by, these forward-looking statements. These risks and uncertainties include, without limitation, the following: a decision by a customer to cancel a purchase order or supply agreement in light of the Company's dependence on a limited number of key customers; uncertain demand for, and acceptance of, the Company's nanocrystalline materials; the Company's manufacturing capacity and product mix flexibility in light of customer demand; the Company's limited marketing experience; changes in development and distribution relationships; the impact of competitive products and technologies; the Company's dependence on patents and protection of proprietary information; the resolution of litigation in which the Company may become involved; the impact of any potential new government regulations that could be difficult to respond to or too costly to comply with while remaining financially viable; the ability of the Company to maintain an appropriate electronic trading venue; and other factors described in the Company's Form 10-K filed March 29, 2016. In addition, the Company's forward-looking statements could be affected by general industry and market conditions and growth rates. Except as required by federal securities laws, the Company undertakes no obligation to update or revise these forward-looking statements to reflect new events, uncertainties or other contingencies.

NANOPHASE TECHNOLOGIES CORPORATION

BALANCE SHEETS


			December 31,
				2016		December 31,
ASSETS			(Unaudited)				2015

Current assets:
	Cash and cash equivalents		$	1,779,027		$	1,275,402
	Trade accounts receivable, less allowance for doubtful accounts
		of $5,000 on December 31, 2016 and $6,000 on December 31, 2015		434,226			506,549
	Other receivable			96			43
	Inventories, net			771,975			661,593
	Prepaid expenses and other current assets			441,634			247,726
		Total current assets		3,426,958			2,691,313

	Equipment and leasehold improvements, net			1,395,441			1,860,579
	Other assets, net			19,893			22,381
			$	4,842,292		$	4,574,273

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
	Current portion of capital lease obligations			107,021			94,406
	Accounts payable			669,025			507,643
	Accrued expenses			521,302			276,287
		Total current liabilities		1,297,348			878,336

	Long-term portion of capital lease obligations			109,448			143,560
	Long-term deferred rent			465,850			518,747
	Asset retirement obligation			178,378			172,238
		Total long-term liabilities		753,676			834,545


Stockholders' equity:
	Preferred stock, $.01 par value, 24,088 shares authorized and
		no shares issued and outstanding		-
	Common stock, $.01 par value, 42,000,000 and 35,000,000 shares authorized;						-
		31,229,996 and 28,585,496 shares issued and outstanding on December 31, 2016
		and December 31, 2015, respectively		312,300			285,855
	Additional paid-in capital			97,359,324			96,172,795
	Accumulated deficit			(94,880,356	)		(93,597,258	)
		Total stockholders' equity		2,791,268			2,861,392
			$	4,842,292		$	4,574,273

NANOPHASE TECHNOLOGIES CORPORATION

STATEMENTS OF OPERATIONS

(Unaudited)

				Three months ended						Twelve months ended
				December 31,						December 31,
					2016			2015			2016			2015
Revenue:
	Product revenue, net			$	2,343,061		$	2,271,979		$	10,719,808		$	10,271,919
	Other revenue				24,283			7,780			62,739			41,270
		Net revenue			2,367,344			2,279,759			10,782,547			10,313,189

Operating expense:
	Cost of revenue				1,776,592			1,606,702			7,542,876			7,199,594
		Gross profit			590,752			673,057			3,239,671			3,113,595

	Research and development expense				494,181			303,193			1,553,688			1,272,621
	Selling, general and administrative expense				803,057			703,585			2,954,232			3,019,424
Income/(Loss) from operations					(706,486	)		(333,721	)		(1,268,249	)		(1,178,450	)
Interest income					-			-			-			-
Interest expense					(3,540	)		(4,625	)		(14,849	)		(13,999	)
Other, net					-			-			-			-
Income/(Loss) before provision for income taxes					(710,026	)		(338,346	)		(1,283,098	)		(1,192,449	)
Provision for income taxes					-			-			-			-
Net income/(loss)				$	(710,026	)	$	(338,346	)	$	(1,283,098	)	$	(1,192,449	)


Net income/(loss) per share- basic and diluted				$	(0.02	)	$	(0.01	)	$	(0.04	)	$	(0.04	)

Weighted average number of basic and diluted
	common shares outstanding				31,229,996			28,585,496			30,911,869			28,574,902


NANOPHASE TECHNOLOGIES CORPORATION

*STATEMENTS OF OPERATIONS - EXPANDED SCHEDULE*

(Unaudited)

				Three months ended						Twelve months ended
				December 31,						December 31,
					2016			2015			2016			2015
Revenue:
	Product revenue, net			$	2,343,061		$	2,271,979		$	10,719,808		$	10,271,919
	Other revenue				24,283			7,780			62,739			41,270
		Net revenue			2,367,344			2,279,759			10,782,547			10,313,189

Operating expense:
	Cost of revenue detail:
	Depreciation				80,503			147,685			471,660			581,382
	Non-Cash equity compensation				5,298			5,105			22,398			22,369
	Other costs of revenue				1,690,791			1,453,912			7,048,818			6,595,843
		Cost of revenue			1,776,592			1,606,702			7,542,876			7,199,594
			Gross profit		590,752			673,057			3,239,671			3,113,595

	Research and development expense detail:
	Depreciation				22,018			27,475			104,852			113,043
	Non-Cash equity compensation				9,090			8,279			36,354			34,380
	Other research and development expense				463,073			267,439			1,412,482			1,125,198
		Research and development expense			494,181			303,193			1,553,688			1,272,621

	Selling, general and administrative expense detail:
	Depreciation and amortization/impairment				60,121			10,090			88,532			40,449
	Non-Cash equity compensation				64,141			27,902			148,317			123,828
	Other selling, general and administrative expense				678,795			665,593			2,717,383			2,855,147
		Selling, general and administrative expense			803,057			703,585			2,954,232			3,019,424
Income/(Loss) from operations					(706,486	)		(333,721	)		(1,268,249	)		(1,178,450	)
Interest income					-			-			-			-
Interest expense					(3,540	)		(4,625	)		(14,849	)		(13,999	)
Other, net					-			-			-			-
Income/(Loss) before provision for income taxes					(710,026	)		(338,346	)		(1,283,098	)		(1,192,449	)
Provision for income taxes					-			-			-			-
Net income/(loss)				$	(710,026	)	$	(338,346	)	$	(1,283,098	)	$	(1,192,449	)

Non-GAAP Disclosure (see note regarding Non-GAAP disclosures):
	Addback Interest, net				3,540			4,625			14,849			13,999
	Addback Depreciation/Amortization/Impairment				162,642			185,250			665,044			734,874
	Addback Non-Cash Equity Compensation				78,529			41,286			207,069			180,577

	Adjusted EBITDA			$	(465,315	)	$	(107,185	)	$	(396,136	)	$	(262,999	)

COMPANY CONTACT
Nancy Baldwin
Investor Relations
630-771-6708

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