Research Frontiers Reports Fourth Quarter and Full Year 2019 Financial Results

Management to Host Conference Call at 4:30 p.m.

WOODBURY, N.Y., March 12, 2020 (GLOBE NEWSWIRE) -- Research Frontiers Inc. (Nasdaq: REFR) announced its financial results for its fourth quarter and full year ended December 31, 2019. Management will host a conference call today at 4:30 p.m. Eastern Time to discuss its financial and operating results as well as recent developments.

  • Who: Joseph M. Harary, President & CEO, Seth Van Voorhees, CFO
  • Date/Time: Thursday, March 12, 2020 at 4:30PM ET
  • Dial-in Information: 1-888-334-5785
  • Questions: Email to
  • Replay: Available on Friday, March 13, 2020 for 90 days at

Key Comments:

  • In December 2019, Gauzy celebrated the opening of its second production facility in Stuttgart, Germany to produce SPD-Smart light control film for the entire SPD-SmartGlass industry. New and improved film from this new facility is currently being shipped to customers worldwide.
    • This state-of-the-art facility, with specially designed coating and curing areas, gives Gauzy the capacity to coat over one million square meters of SPD film per year in widths of up to 1.8 meters.
  • In December 2019, Glatic Co. acquired a license from Research Frontiers to produce and sell SPD-SmartGlass smart windows for the South Korean architectural market.
  • The Company’s fee income from licensing activities for the year ended December 31, 2019 was $1,564,024 as compared to $1,488,642 for the year ended December 31, 2018 representing a $75,382 increase between these two periods.
    • This increase in revenues was principally the result of higher royalty income from licensees focused on automotive and architectural markets. Royalty income from the automotive and architectural markets was up over 40% in 2019 compared with 2018.
    • When operations from the Company’s suspended VariGuard business unit are factored out, fee income for 2019 would have been $130,316 (9%) higher than for 2018.
  • The amount of SPD light-control film sold in 2019 reached a twelve-year record high.
  • Expenses increased by $857,168 for the year ended December 31, 2019 to $4,764,029 from $3,906,861 for the year ended December 31, 2018.
  • The Company’s net loss increased by $1,122, 852 to $3,808,978 ($0.13 per common share) for the year ended December 31, 2019 as compared to $2,686,128 ($0.10 per common share) for the year ended December 31, 2018.
    • Approximately $1,310,236 of the increase in net loss between these two periods were non-cash accounting expenses relating to the issuance of options and warrants, and other one-time charges. Without these items, the Company’s net loss for 2019 would have been $2,108,039 ($0.07 per common share) or $187,386 higher than in 2018.
  2019  2018  Change $ 
Net Loss $(3,808,978) $(2,686,128) $(1,122,850)
Options & Warrants Issued  841,612   69,309   772,303 
Warrant Market Value Adjustment  652,025   278,044   373,981 
Bad Debt/Impairment of Fixed Assets  207,302   43,350   163,952 
Adjusted Net Loss $(2,108,039) $(2,295,425) $187,386 
Adjusted Net Loss Per Common Share $(0.07) $(0.09) $0.02 

  • During 2019, the Company’s cash and cash equivalents balance increased by $3,622,544 principally as a result of cash proceeds of $5,770,545 from the sale of common stock and warrants and the exercise of options and warrants.
    • At December 31, 2019 the Company had cash and cash equivalents of $6,591,960 and working capital of $6,919,428
    • The Company currently believes that its current cash and cash equivalents will fund its operations for at least the next 36 months.

Non-GAAP Financial Information
In addition to financial measures prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), from time to time we may use or publicly disclose certain “non-GAAP financial measures” in the course of our financial presentations, earnings releases, earnings conference calls and otherwise. For these purposes, the U.S. Securities and Exchange Commission (“SEC”) defines a “non-GAAP financial measure” as a numerical measure of historical or future financial performance, financial positions or cash flows that (i) excludes amounts, or is subject to adjustments that effectively exclude amounts, included in the most directly comparable measure calculated and presented in accordance with GAAP in financial statements, and (ii) includes amounts, or is subject to adjustments that effectively include amounts, that are excluded from the most directly comparable measure so calculated and presented.

Non-GAAP financial measures are provided as supplemental information to investors to provide an alternative method for assessing our financial condition and operating results. We believe that these non-GAAP measures, when taken together with our GAAP financial measures, allow us and our investors to better evaluate our performance and profitability. These measures are not in accordance with or a substitute for GAAP, and they may be different from or inconsistent with non-GAAP financial measures used by other companies. These measures should be used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures.

Pursuant to the requirements of Regulation G, whenever we refer to a non-GAAP financial measure in this press release, we will also generally present the most directly comparable financial measure calculated and presented in accordance with GAAP, along with a reconciliation of the differences between the non-GAAP financial measure we reference and such comparable GAAP financial measure.

Adjusted Net Loss

“Adjusted Net Loss” is defined as net loss adjusted to exclude non-cash expenses related to stock-based compensation, warrants, and from time to time, other non-cash or nonrecurring items. We use Adjusted Net Loss to evaluate operating performance. We further believe that the presentation of Adjusted Net Loss is relevant and useful for investors because it allows investors to view results in a manner similar to the method used by management.

For more details, please see the Company’s Annual Report on Form 10-K which was filed today with the SEC, the contents of which are incorporated by reference herein.

Research Frontiers (Nasdaq: REFR) is a publicly traded technology company and the developer of patented SPD-Smart light-control film technology which allows users to instantly, precisely and uniformly control the shading of glass or plastic products, either manually or automatically. Research Frontiers has licensed its smart glass technology to over 40 companies that include well known chemical, material science and glass companies. Products using Research Frontiers’ smart glass technology are being used in tens of thousands of cars, aircraft, yachts, trains, homes, offices, museums and other buildings. For more information, please visit our website at, and on FacebookTwitterLinkedIn and YouTube.

Seth L. Van Voorhees
Chief Financial Officer
Research Frontiers Inc.

Note: From time to time Research Frontiers may issue forward-looking statements which involve risks and uncertainties. This press release contains forward-looking statements. Actual results could differ and are not guaranteed. Any forward-looking statements should be considered accordingly. "SPD-Smart" and "SPD-SmartGlass" are trademarks of Research Frontiers Inc.

Unaudited Consolidated Balance Sheets
December 31, 2019 and 2018

  2019  2018 
Current assets:        
Cash and cash equivalents $6,591,960  $2,969,416 
Royalties receivable, net of reserves of $1,135,598 in 2019 and $1,094,774 in 2018  656,062   689,677 
Prepaid expenses and other current assets  58,835   52,729 
Total current assets  7,306,857   3,711,822 
Fixed assets, net  141,720   313,177 
Operating lease ROU assets  773,989   - 
Deposits and other assets  33,567   33,567 
Total assets $8,256,133  $4,058,566 
Liabilities and Shareholders’ Equity        
Current liabilities:        
Current portion of operating lease liability $163,236  $- 
Accounts payable  169,750   133,486 
Accrued expenses and other  46,709   273,606 
Deferred revenue  7,734   50,570 
Total current liabilities  387,429   457,662 
Operating lease liability, net of current portion  812,596   - 
Warrant liability  -   501,414 
Total liabilities  1,200,025   959,076 
Shareholders’ equity:        
Common stock, par value $0.0001 per share; authorized 100,000,000 shares, issued and outstanding 31,254,262 in 2019 and 27,665,211 in 2018  3,125   2,767 
Additional paid-in capital  122,552,895   114,787,657 
Accumulated deficit  (115,499,912)  (111,690,934)
Total shareholders’ equity  7,056,108   3,099,490 
Total liabilities and shareholders’ equity $8,256,133  $4,058,566 

Unaudited Consolidated Statements of Operations
Years ended December 31, 2019 and 2018

  2019  2018 
Fee income $1,564,024  $1,488,642 
Operating expenses  3,677,740   3,043,460 
Research and development  1,035,623   863,401 
Loss on impairment of fixed asset  50,666   - 
Total Expenses  4,764,029   3,906,861 
Operating loss  (3,200,005)  (2,418,219)
Warrant market adjustment  (652,025)  (278,044)
Net investment income  43,052   10,135 
Net loss $(3,808,978) $(2,686,128)
Basic and diluted net loss per common share $(0.13) $(0.10)
Weighted average number of common shares outstanding  30,011,556   25,956,232 

Unaudited Consolidated Statements of Shareholders’ Equity
Years ended December 31, 2019 and 2018

  Common Stock  Additional
  Shares  Amount  Capital  Deficit  Total 
Balance, January 1, 2018  24,043,846  $2,404  $111,627,789  $(109,062,827) $2,567,366 
Adoption of ASC 606  -   -   -   58,021   58,021 
Issuance of capital stock  3,562,809   357   3,026,273   -   3,026,630 
Exercise of options and warrants  58,556   6   64,286   -   64,292 
Share-based compensation  -   -   69,309   -   69,309 
Net loss  -   -   -   (2,686,128)  (2,686,128)
Balance, December 31, 2018  27,665,211   2,767   114,787,657   (111,690,934)  3,099,490 
Exercise of options and warrants  1,587,814   158   1,170,388   -   1,170,546 
Issuance of common stock  2,001,237   200   4,599,799   -   4,599,999 
Warrants converted to equity  -   -   1,153,439   -   1,153,439 
Share-based compensation  -   -   841,612   -   841,612 
Net loss  -   -   -   (3,808,978)  (3,808,978)
Balance, December 31, 2019  31,254,262  $3,125  $122,552,895  $(115,499,912) $7,056,108 

Unaudited Consolidated Statements of Cash Flows
Years ended December 31, 2019 and 2018


  2019  2018 
Cash flows from operating activities:        
Net loss $(3,808,978) $(2,686,128)
Adjustments to reconcile net loss to net cash used in operating activities:        
Depreciation and amortization  195,377   181,047 
Warrant market adjustment  652,025   278,044 
Share-based compensation  841,612   69,309 
Loss on impairment of fixed asset  50,666   - 
Bad debts  156,636   43,350 
Change in assets and liabilities:        
Royalties receivable  (123,021)  (77,565)
Prepaid expenses and other current assets  (6,104)  (23,032)
Accounts payable and accrued expenses  1,904   94,169 
Deferred revenue  (42,836)  49,746 
Net cash used in operating activities  (2,082,719)  (2,071,060)
Cash flows from investing activities:        
Purchases of fixed assets  (65,282)  (11,663)
Net cash used in investing activities  (65,282)  (11,663)
Cash flows from financing activities:        
Net proceeds from issuances of common stock and warrants
and exercise of options and warrants
  5,770,545   3,314,292 
Net cash provided by financing activities  5,770,545   3,314,292 
Net increase in cash and cash equivalents  3,622,544   1,231,569 
Cash and cash equivalents at beginning of year  2,969,416   1,737,847 
Cash and cash equivalents at end of year $6,591,960  $2,969,416