Digital Power Corporation announced its financial results for Q4 and the year ended December 31, 2014. Revenues for the year were $9,022,000.
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This is an increase of 3% from revenues of $8,770,000 for the year ended December 31, 2013. The company recorded an operating loss of $542,000 for the year ended December 31, 2014 compared to an operating loss of $317,000 for comparable 2013 period.
Non GAAP operating losses were $189,000 and $115,000 for the 2014 and 2013 years, respectively. Net loss for the year ended December 31, 2014 was $658,000, an increase of 4%, or $26,000, over the loss of $632,000 for the year ended December 31, 2013
Non GAAP net losses were $130,000 and $118,000 for the 2014 and 2013 years, respectively. Gross margins in 2014 and 2013 were comparable at 36%.
Digital Power reported revenues of $2,112,000 for the fourth quarter ended December 31, 2014, a decrease of 7% from revenue of $2,267,000 in the comparable quarter in 2013. The company recorded an operating loss of $360,000 for the fourth quarter of 2014 compared to an operating loss of $173,000 for the fourth quarter of 2013.
Non GAAP operating losses were $238,000 and $107,000 for the fourth quarter of 2014 and fourth quarter of 2013, respectively. Digital Power reported a net loss of $499,000 for the fourth quarter of 2014 compared to a net loss of $361,000 for the fourth quarter of 2013. Non GAAP net losses were $202,000 and $110,000 for the fourth quarter of 2014 and fourth quarter of 2013, respectively.
Commenting on the results, president and CEO Amos Kohn stated: "For the year ended December 31, 2014 our net loss of $658,000 included $247,000 of stock option expenses, $106,000 of intellectual property amortization expenses, and $175,000 for impairment expenses related to our Telkoor investment of 2011.
"For the year ended December 31, 2013, our net loss of $632,000 included $106,000 of stock option expenses, $96,000 for intellectual property amortization, and $312,000 for the Telkoor investment impairment. Excluding the aforementioned non cash related expenses our net loss would have been $130,000 for the year ended December 31, 2014 and $118,000 for the year ended December 31, 2013.
"While we are very disappointed about the magnitude of the loss reported for the past two years, it is important to note that 80% and 81% of the losses in 2014 and 2013, respectively, was attributable to non-cash related expenses.
"We comply with generally accepted accounting principles that require inclusion of these expenses. Our cash balances increased to $2.1 million at December 31, 2014 compared to $1.7 million at December 31, 2013 primarily the result of a reduction in accounts receivable balances.
"For the year ended December 31, 2014 our defense product revenues of $2.6 million were similar to the $2.7 million for the year ended December 31, 2013. In 2013, we began to realize our expansion in this market with several new fully customized design projects to supply advanced power switching solutions for military battlefield uses and power rectifier systems for international naval fleets.
"We also completed the development of new power switching solutions for medical surgical instruments and other products for telecom and datacom industries. We have a strong backlog for our defense related products and expect to continue to realize the benefits of our presence in this market.
"Our commercial product revenue increased to $6.4 million for the year ended December 31, 2014 from $6.1 million for the year ended December 31, 2013 primarily as the result of improved orders from our European market.
"For 2014, our domestic commercial product revenue suffered from the loss of a major customer as the result of their acquisition by a European company that changed the strategic direction of their supply chain. ■