EMCORE announce unaudited financial results for 3rd Quarter

Quarterly Filing Delay As previously reported by the Company in its Current Report on Form 8-K filed with the Securities and Exchange Commission ("SEC") on August 16, 2010, the filing of the Quarterly Report on Form 10-Q for the period ended June 30, 2010 was delayed because the Company required additional time to complete its review of the accounting for certain inventory write-downs and the allowance against a specific account receivable and whether these matters affected prior financial periods reported. The Company has now filed its Form 10-Q with the SEC and is current with NASD reporting requirements. During the third fiscal quarter ended June 30, 2010, management determined that approximately $2.5 million of excess and obsolete inventory reserves related to the Company's Fiber Optics segment should have been recorded in the quarter ended September 30, 2009. Accordingly, the consolidated balance sheet as of September 30, 2009 was corrected to reduce inventory by approximately $2.5 million with a corresponding increase to accumulated deficit. The impact from correcting prior period financial statements resulted in the reduction of cost of revenue of approximately $1.2 million and $0.3 million in the quarters ended December 31, 2009 and March 31, 2010, respectively which improved profitability in these reporting periods. The Company also recorded a $0.2 million compensation-related adjustment in the quarter and year ended September 30, 2009. These corrections had no impact to net cash used in operating activities as reported on the statements of cash flows. The effect of these corrections was not considered material to any previously reported financial statement and these corrections will be made to applicable prior period financial information in future filings with the SEC. During the quarter, the Company also recorded a $2.4 million reserve on accounts receivable due to uncertainty about its total collectability. QUARTERLY RESULTS Revenue: Revenue for the third fiscal quarter ended June 30, 2010 was $46.6 million. This slight sequential decline in revenue is due entirely to a timing issue with a major shipment. On a segment basis, revenue for the Photovoltaics segment was $15.1 million and revenue for the Fiber Optics segment was $31.5 million, which represents a 4% sequential increase compared to the immediate preceding quarter. During the quarter, the Photovoltaics segment experienced a quarter-end delay in shipping a satellite solar cell order to an international customer due to an unforeseen logistics issue. In August 2010, this order was shipped and the revenue will be recognized in the quarter ended September 30, 2010. Gross Profit: Consolidated gross profit was $12.8 million and consolidated gross margin was 27.5%. On a segment basis, the third quarter Photovoltaics gross margin was 30.7% and the Fiber Optics gross margin was 25.9%. Operating loss: After excluding certain non-cash and other adjustments as set forth in the attached non-GAAP tables, the third quarter non-GAAP consolidated operating loss was $2.8 million, an increase in loss of $1.1 million from the $1.7 million non-GAAP operating loss reported in the preceding quarter and an improvement of $4.4 million from a $7.2 million non-GAAP operating loss reported in the prior year period. During the quarter ended June 30, 2010, in addition to the accounts receivable reserve discussed above, the Company incurred a one-time non-recurring $2.8 million liability associated with a termination fee on the Company's previously announced joint venture with Tangshan Caofeidian Investment Corporation. Net loss: As set forth in the attached non-GAAP tables, the third quarter non-GAAP net loss per share was $0.03, an increase in loss of $0.01 per share from the $0.02 non-GAAP net loss per share reported in the preceding quarter and an improvement of $0.06 per share, from the $0.09 non-GAAP net loss per share reported in the prior year period. 9-MONTH RESULTS Revenue: Revenue for the nine months ended June 30, 2010 was $137.2 million, an increase of $1.4 million, or 1%, from $135.8 million reported in the prior year period. On a segment basis, revenue for the Photovoltaics segment was $49.9 million, an increase of $4.1 million, or 9%, from $45.8 million reported in the prior year period and revenue for the Fiber Optics segment was $87.3 million compared to $90.0 million reported in the prior year period. Gross Profit: Consolidated gross profit for the nine months ended June 30, 2010 was $37.9 million, an improvement of $45.7 million, from a gross loss of $7.8 million reported in the prior year period. Consolidated gross margin was 27.6%, representing a considerable improvement from the negative 5.8% gross margin reported in the prior year period. On a segment basis, the Photovoltaics gross margin was 33.5%, representing a substantial improvement from an 8.3% gross margin reported in the prior year period and the Fiber Optics gross margin was 24.2%, also a considerable improvement from a negative 13.0% gross margin reported in the prior year period. Net Loss: The consolidated net loss for the nine months ended June 30, 2010 was $22.8 million, an improvement of $99.7 million, from a net loss of $122.5 million reported in the prior year period, with the variance due primarily to the improved operating performance at the gross margin level in fiscal 2010, and the magnitude of the non-cash impairment and other balance sheet reserve adjustments recorded in the prior year. Order Backlog As of June 30, 2010, the Company had a consolidated order backlog of approximately $67.6 million, a slight decrease from a $68.0 million order backlog reported as of the end of the preceding quarter. On a segment basis, the quarter-end Photovoltaics order backlog totaled $42.5 million, a $1.2 million, or 3%, increase from $41.3 million reported as of the end of the preceding quarter. The quarter-end Fiber Optics order backlog totaled $25.1 million, a $1.6 million, or 6% decrease from $26.7 million reported as of the end of the preceding quarter. Order backlog is defined as purchase orders or supply agreements accepted by the Company with expected product delivery and / or services to be performed within the next twelve months. Balance Sheet and Liquidity Update As of June 30, 2010, cash, cash equivalents, available-for-sale securities, and current restricted cash totaled approximately $16.0 million and working capital totaled $33.1 million. For the nine months ended June 30, 2010, the Company consumed $5.2 million in cash from operations compared with $30.5 million in the prior year period with the improvement due primarily to improved operating performance and working capital management. In fiscal 2010, the consumption of $5.2 million of cash was entirely related to an increase in components of working capital. Over the last year, the Company achieved positive cash flow from operations in two of the last four quarters, including the quarters ended September 30, 2009 and March 31, 2010. The Company continues to maintain a $14 million credit facility with Bank of America and a $23 million committed and available equity line of credit facility with the Commerce Court Small Cap Value Fund, Ltd. Business Outlook In the fourth fiscal quarter ending September 30, 2010, the Company expects consolidated revenue to be $54-$55 million, which represents an approximately 16%-18% sequential revenue increase, with increases in revenue expected for both the Photovoltaics and Fiber Optics segments. Furthermore, the Company expects significant positive cash flow generated from operations in the fourth quarter.