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Luna Innovations Inc (Old)Â (LUNA -2.93%)
Q1Â 2020 Earnings Call
May 7, 2020, 5:00 p.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Ladies and gentlemen, thank you for standing by and welcome to the Q1 2020 Luna Innovations Incorporated Earnings Conference Call. At this time all participants lines are in a listen-only mode.
[Operator Instructions]
I would now like to hand the conference over to your speaker today Allison Woody. Thank you. Please go ahead.
Allison Woody -- Director of Administration
Thank you. Good afternoon and thank you for joining us today. This afternoon we issued our first quarter fiscal 2020 earnings press release. In addition, we posted to the Investor Relations section of our website, a presentation with supplemental information for the quarter. If you do not have a copy of the release or the supplemental materials, please check our website at lunainc.com. We will also post a replay of this call to our website. Some of our comments and discussions today are based on non-GAAP measures, specifically adjusted EBITDA. These adjusted numbers exclude the effect of certain non-cash expenses and other items. The adjusted results are a supplement to the GAAP financial statements.
Luna believes the presentation and exclusion of these items is useful in order to focus on what we deem to be a more reliable indicator of ongoing operating performance. Before we proceed with our presentation today, let us remind you that statements made on this conference call as well as in our public filings, releases and websites, which are not historical facts may be forward-looking statements that involve risk and uncertainties and are subject to changes at any time, including but not limited to, statements about our expectations regarding future operating results or the ongoing prospects of the Company. Actual results may differ materially as a result of a variety of factors. More complete information regarding forward-looking statements, risks and uncertainties is available in the Company's SEC filings, which can be found on the SEC website and our website. We disclaim any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future events or developments except as required by law. As for our prepared remarks, Scott Graeff, our President and Chief Executive Officer; Gene Nestro, our Chief Financial Officer; Brian Soller, Senior Vice President and General Manager of our Lightwave Division and James Garrett, Senior Vice President and General Manager of our Luna Labs division will be available to take your questions.
And at this time, I would like to turn the call over to Scott.
Scott A. Graeff -- President and Chief Executive Officer
Good afternoon, everyone. As Allison mentioned, we issued our first quarter 2020 press release at market close and you'll find it on our website. What an extraordinary time it has been since we last got together. Let me begin by thanking all of you for taking the time to join us today and saying that I hope you and those close to, you are healthy and safe. I am incredibly grateful to be at the helm of a company, which for the most part has been able to stay the course. I want to be clear, this does not mean that we are completely immune to the broad effects of this pandemic and the significant macroeconomic downturn, which is currently hitting some industries harder than others and I'm very mindful of how quickly a situation can change. For context, I was COO of Luna in 2008 when the financial crisis hit. During that time, we were forced to lay-off nearly 25% of our workforce at all levels, halt production and we experienced the negative effect of sequestration on our contract research business. I know first-hand how difficult it is to recreate a talented leadership team and maintain production lines. That's why it is critical for us in the face of this current global challenges related to the coronavirus epidemic to retain and maintain our highly skilled, highly educated workforce. You just can't flip a switch and quickly rebuild that type of team. And that's why I'm clearly focused on doing as much as possible through this pandemic to stay the course operationally, so that we may remain soundly positioned when these storm clouds clear. As you will hear from our comments this afternoon, we were able to deliver to our expectations for the first quarter of 2020 and as you saw from the release we issued, we are reaffirming our guidance for the full year but likely toward the lower end of the ranges. As we prepared for this call, Gene and I spent quite a bit of time with our operational and sales teams to understand any trends or forward indicators they might be seeing that suggest a softening of the business or any other significant changes. Just as importantly, Brian. James and I have spent time on the phone with our customers and our component suppliers to better understand how the pandemic may affect their operations. Our pipeline for the second half of the year has forecasted orders of varying sizes. For a company of our size having any of the larger orders pushed out of this year could significantly affect our results. But with the information we have today, we have no evidence of a softening in our business that would cause us to alter our guidance. Of course, just like everyone else, we've had to make adjustments to the way we are doing business, particularly as Luna is designated as essential. You may have seen that we issued a release on April 14 with some of the details around what we are doing to adjust to this new environment. I'm exceptionally proud of the entire Luna team, which continues to demonstrate dedication, resilience and positivity while delivering results. Their safety and well-being my top priorities. I'd like to start by providing an overview of the results for the first quarter and then I'll share some of the details around how the pandemic is affecting Luna as well as my thoughts on the remainder of the year. For the first quarter, total revenues were up 16% to $17.1 million compared to the prior year's quarter. Products and licensing really drove this with an increase of 26% year-over-year. We expanded gross margin by 320 basis points and delivered adjusted EBITDA of $1.6 million, up 600,000 over last year. Now let's move on to our businesses, starting with Lightwave.
Lightwave reported a strong first quarter with product revenues growing 24% on a year-over-year basis. This year-over-year increase was primarily driven by a near doubling of revenues in the communications test segment. As a reminder, the acquisition of General Photonics occurred at the beginning of March 2019, resulting in an additional two months of revenue in Q1 of this year that we did not have in 2019. We also achieved strong double-digit growth of our legacy communications test products driven by sales of our OBR or Optical Backscatter Reflectometer. Let me provide a few additional highlights while I'm covering communications test. OBR sales were bolstered in Q1 by sales of our two newest versions, the OBR 6415 and the OBR 6200, both of which we've discussed in some detail on previous calls. The OBR 6415 was launched last year and is our latest high speed OBR aimed at enhancing R&D and production of fiber optic components and systems. In Q1, we delivered multiple systems to customers working primarily in manufacturing of fiber optic components and cables. We view this as evidence that our strategy to penetrate manufacturing applications is beginning to pay off. And in Q1, we officially launched a commercial version of our newest product, the OBR 6200. The OBR 6200 is our new portable OBR test instrument for field test applications. On previous calls, we've discussed our development and delivery of the military qualified version of OBR 6200 aimed at field maintenance of military aircraft. In fact, we booked several new orders for the military grade version of the OBR 6200 in Q1. We also booked a large blanket order in excess of 700,000 for our General Photonics line of products. These units will be integrated into a satellite communications system. Moving on to our sensing segment, as a reminder, this segment includes our ODiSI and HYPERION distributed fiber optic sensing products as well as our Terahertz instruments. Total revenue in Q1 2020 for this segment versus the prior year period were down. We had several large orders for products in this segment shift into Q2, especially for our Terahertz products.
As a reminder, the timing of Terahertz orders often can be lumpy throughout the year. A highlight in this segment was that we booked a large multiple unit order for our HYPERION product to be deployed later this year in China for an oil pipeline monitoring application. Our HYPERION system will monitor the pipeline for any damage resulting from seismic activity. We have continued to invest in our business, particularly in our sales and engineering capabilities and we're seeing the benefits from all the investment and work to lay the foundation. We're well positioned to leverage the growth in fiber optics, and we continue to be excited about the momentum that we're seeing. Obviously, a lot has changed since we drove the bulk of these results in Lightwave. So before I switch over to the technology development or Luna Labs, let me give you some color about our Lightwave operations during this pandemic. We've been able to continue to operate at all of our locations with employees either telecommuting or participating in staggered schedules and shifts following all social distancing guidelines. And by implementing these changes, we've been able to continue to deliver our global network of customers. In fact during March, two of our locations set record totals for products shipped off the dock. We're also working very closely with our global supply chain. We mentioned on last quarter's call that we were seeing some slowdown from our supply base in Asia. I'm happy to report that those impacts in Q1 were minimal and did not result in any delayed shipments of Luna products to our customers.
While we continue to experience some minor delays in the early part of Q2, all indications from our partners are that the supply chain for critical parts in Asia is expected to be fully caught up by the end of May. Where we've seen a delay, we've been able to draw from our inventory of components to continue production. We're monitoring our supply chain very closely and we will remediate any issues that arise. As we sit here today, we believe we can procure the components necessary to meet our sales needs. As it relates to our sales activities, historically, an important part of our sales has been through a series of trade shows and conferences, none of which we are currently taking place. We quickly shifted to a robust, online presence, hosting and planning to host a total of six webinars to educate existing and potential customers about our key products. While trade shows have always been successful in filling our sales pipeline, these webinars have allowed very good engagement between sales and customers and allow Luna to curate a specific message over a longer and more dedicated period of customer face time. We're also developing application specific white papers that highlight each product's unique capabilities and are leveraging broad media outlets to publish these papers. We certainly recognize that our main target markets will be affected differently and we do expect a slowdown in the aerospace and automotive industries due to the impact of the coronavirus. That said, we do not at this point expect a material impact in the infrastructure, defense and communications segments. The bottom line is that to date, we've not seen a material impact on our pace of sales or the size and the health of our sales pipeline within the Lightwave division.
I'll move on to a discussion of technology development, which we are now calling Luna Labs. As a reminder, Luna Labs works in research areas that are outside of our core strategic fiber optic activities. Here, we primarily leverage third-party contract research to build a portfolio of technologies that could be future growth areas for Luna. Mature technologies are commercialized by Luna labs through direct sales, distributors or licensing agreements. Revenues were $6.8 million in the first quarter of 2020 which represents a 3% increase versus the prior year. Within Luna Labs, one of the biggest challenges stemming from the pandemic is that several of our partners, especially academic collaborators, have been forced to shut down. We have a strong talented internal team and a diverse network of partners to help us fill any gaps in specific expertise. For example, all animal studies for our biomedical projects are conducted by external partners. In particular, we partnered with many university laboratories. Because many universities are closed, this has slowed work on some contracts, which will present challenges to realizing the full revenue potential within the original timeframe. We are exploring other options to complete the work that is time-critical. We've kept our focus, working on projects and making up any shortfall in our traditional SBIR Phase 1 and Phase 2 revenue with later stage research and Luna Labs products. Overall, the COVID impact from Luna labs to our total top and bottom line is not expected to be significant and the adjusted contribution still falls within our 2020 outlook ranges I hope that my comments have given you a clear picture of how we're operating in our two business segments and an idea of some of our challenges. One of my highest priorities continues to be communicating as quickly and openly as possible as facts and circumstances change, both with Luna employees and with all of our stakeholders. I continue to frequently touch base with employees, I meet virtually with every one of our locations on a weekly basis. We've enjoyed our several virtual happy hours and have received numerous positive messages from employees. We have not furloughed any employees or reduced compensation at this point. We've adopted the Cares Act option in the 401(k) plan that allows access to funds that may be needed by individual employees. We've worked with employees to provide time-off under the FFCRA so they may care for themselves or an affected family member. Finally, we applied for and were awarded PPP funding.
However, as many of you have undoubtedly experienced, the criteria for qualification has continually changed. So based on the fact that we have a reasonable balance of cash, we recently made a decision to decline and return the loan. I'm focused on the potential impact to our business if our customers and suppliers don't return to work and production as we've assumed. Based on the facts we have currently, which includes the strict criteria around the loan, we felt the prudent path was to decline the government's assistance. Most importantly, our strategy and core priorities have not changed. We continue to serve our customers with excellence and produce outstanding and innovative fiber optic based products. As always, we're focused on the value we can and will create long-term.
With that, let me address our guidance for 2020. Because we gave our initial 2020 outlook on March 5th, we had some visibility into the COVID-19 issue. There was already some discussion around remote work and how the pandemic might affect our operations. As we prepared for today's call, our teams conducted a bottoms-up analysis, took a hard look at our pipeline, reached out even more to customers and suppliers as I mentioned earlier. So, leveraging what we know today in order to complete our forecast, we're maintaining the 2020 outlook we provided on March 5th, which is total revenues of $81 million to $84 million, adjusted EBITDA of $10 million to $12 million although we do believe that our full year 2020 financial performance will trend toward the lower end of these ranges. As a reminder, in terms of seasonality, we expect the results will continue to be weighted to the second half with the percentage split in H1 2020 being slightly below historical trends. Remember, that in recent years, Luna has recorded approximately 44% to 46% of our revenue in the first half of the year. If the global shut down lasts beyond mid-summer, then we will reevaluate. However, based on what we know today, it would be completely arbitrary for us to withdraw our 2020 outlook. We realize how complex our current environment is and we're being as transparent as possible as we see shifts in operational or financial trends. We started 2020 by articulating a strong vision of enabling the future with fiber and we're very clear about our purpose. Despite the challenges COVID-19 has created, we continue to feel good about delivering against our goals, including our 2020 outlook with the additional color I mentioned.
I'll now hand the call over to Gene for more of the financial details on the quarter. Gene?
Gene Nestro -- Chief Financial Officer
Thank you, Scott. I'd like to start by covering a few unique components of this quarter's results. First, the income statement for this first quarter of 2020 includes the incremental effect of two months of General Photonics. At the beginning of March 2020, we lapped a full year of ownership of this asset. Second, the first quarter of 2019 included a non-recurring item, which was a one-time tax benefit of $1.9 million and which has not repeated this year, driving a significant difference in the year-over-year comparison. Finally, in SG&A, there were about $25 million [Phonetic] in recurring and non-cash expenses. These are costs associated with the two acquisitions and include amortization of the new intangible assets as well as an increase in share-based compensation. Remember that Q1 2019 only included one month of these costs for General Photonics. Our revenues for Q1 2020 were $17.1 million compared to revenues of $14.8 million for Q1 2019, representing a 16% year-over-year increase. The increase in revenues year-over-year was composed of a 26% increase in our products and licensing segment and a 3% increase in our technology development or Luna Lab segment. Within the products and licensing segment, our year-over-year growth continue to be driven by strong performance from our communications test business.
Our gross profit increased to $8.4 million for the quarter compared to $6.8 million for the same quarter last year, representing a gross margin of approximately 49% in Q1 2020, compared to more than 45% in Q1 2019. The gross margin improvement continues to reflect, in part, the changing mix of our revenues with about 60% of our revenues coming from the products and licensing segment in Q1 2020 compared to about 55% in Q1 2019. This change in mix is driven largely by our acquisitions and is consistent with our long-term strategy. Operating expenses were $8 million or approximately 47% of revenue in Q1 2020 compared to $7.7 million or about 52% of revenue in Q1 2019. During Q1 '20, we continued to see operating leverage on our increasing sales. The increase in SG&A expenses continue to be largely driven by the same two items we've previously discussed. These are both the incremental expense associated with last year's acquisition as well as higher sales and marketing expenses in Lightwave as we continue to support that division's increasing sales. With the revenue growth and gross margin expansion, our operating profit improved to $0.4 million in Q1 2020 compared to a loss of $0.9 million in Q1 of last year. Net income from continuing operations for Q1 2020 was $0.3 million or $0.01 per share compared to $1.1 million for Q1 2019. I mentioned at the beginning of my remarks that last year's Q1 included a $1.9 million tax benefit that is not included in this quarter. And finally, a key metric reflecting our underlying operations is adjusted EBITDA.
As Scott mentioned, adjusted EBITDA was nearly $1.6 million for the first quarter of 2020 versus $960,000 in Q1 2019. This solid performance was driven primarily by strong topline growth from both our legacy businesses and those businesses we acquired combined with our ongoing expense management. Let me move now to the balance sheet. Cash increased by $1.3 million sequentially and we ended the quarter with $26.3 million of cash and cash equivalents compared to $25 million at the end of 2019. Our working capital was $41.9 million at March 31 compared to $41.1 million on December 31, 2019. Scott already discussed our 2020 outlook. So I won't repeat it. But I do want to reiterate what Scott outlined at the beginning regarding our assessment and bottoms-up analysis of our businesses, which led to our decision to maintain the outlook. We take providing an outlook very seriously and know that you, our investors do as well. We continue to monitor and evaluate the effects from this pandemic on a daily basis. At this time, with what we know, we believe we still will come in within our original 2020 outlook ranges, but just trending toward the lower end as we've said. We will continue to be transparent and should things change significantly, we will communicate that information. Before I turn the call back to Scott to conclude, I want to give you one additional heads up with respect to the second quarter and how we will be reporting.
As you've heard us mention in this call, what was previously our technology development group, we're now referring to as Linda Labs. Similarly, internally we refer to products and licensing as Lightwave. Therefore in the second quarter, you will see us start to report as two segments, Lightwave and Luna Labs, to more accurately reflect how we manage and discuss our businesses. In Q2, we will provide you with historical quarterly information so that you can adjust your models accordingly to reflect the Lightwave and Luna Labs business segments.
With that I will turn the call back over to Scott.
Scott A. Graeff -- President and Chief Executive Officer
Thank you, Gene. At this time, I'd like to open up the call for questions. Brian Soller, Senior Vice President and General Manager of our Lightwave Division and James Garrett, Senior Vice President and General Manager of our Luna Labs division are with Gene and me at this time and also available to address questions, I wanted to ensure that the proper folks who are on the phone today to address any specific business segment questions you might have. With that, we'll take questions.
Questions and Answers:
Operator
[Operator Instructions]
You have a questioner from the line of Barry Sine with Spartan Capital.
Barry Sine -- Spartan Capital -- Analyst
Hey, good afternoon gentlemen. First question regarding trade shows. I appreciate you calling that out and I understand your strategy, the kind of sell virtually rather than in person to trade shows. Can you give some estimate as to what percentage of your revenue have come in via trade shows historically?
Scott A. Graeff -- President and Chief Executive Officer
Last time we talked Barry, we did attend OFC and there were not a lot of folks there, Brian and we took a smaller staff to the last trade show, we were at, was the industry's largest trade show, OFC. So that was a big show that was sparsely attended. I don't know if we track the revenue per se by what comes in from trade shows. It's just a matter of touch points that we have directly with the customers and like we said, we're trying to supplement that with webinars and phone calls directly from the sales guys to folks and things like that. I'll let Brian talk more about it obviously Barry, but I'm not -- I know it's something that we utilize and like I said, we're trying to supplement it. Brian?
Brian J. Soller -- Senior Vice President & General Manager, Lightwave Division
Yes, sure. Hey, Barry. Certainly, trade shows do generate quite a bit of sales activity for us. We don't track specifically how much revenue can be attributed to a specific trade show per se, but from a lead generation perspective, I mean if you look at something in the range of probably 40% of our leads or more come from trade shows. So that activity is really important for us. I can say that if the aggressive position we've taken with getting webinars and virtual meetings going. We've had two of the six already. The second was actually today. And the statistics have been very good. So we'll see how it all flows through into the funnel. But thus far, what we found is that our webinar attendance has been really strong with over 200 new leads generated at the first one and the one today, it was up in the 500 plus range, which puts us statistically, actually slightly ahead of what we would garner from a trade show. I think it's an issue of people looking for new way and different ways to connect.
Barry Sine -- Spartan Capital -- Analyst
Okay, that's helpful. And again I wanted to slice and dice the COVID-19 impact a little bit differently. I appreciate your thoroughness and I wanted to do address it from an end industry market standpoint. And this kind of three industries that I have in mind that I think might add some impact, which would be commercial aviation, energy and automotive. Maybe you could talk a little bit about what you do in each of those and why demand may or may not be impacted by COVID-19 and one aspect I'm wondering about is how much of your revenue from each of those comes from R&D work or development work that might not be impacted and how much comes from actual production? So for example if the auto industry is selling fewer cars, we just see fewer shipments of any particular product.
Scott A. Graeff -- President and Chief Executive Officer
Yes, I'll start Barry briefly and then let Bryan dive into a little bit more detail on that. We talked about on the last call, specifically a lot of the work that we're doing with the fiber sensing is in kind of R&D for future use. There was not a lot of 2020 exposure, specifically in the commercial aerospace market. We were working on things that are going into next generation kind of turns of airplanes and things like that as well as the R&D that we're working with, in automotive. So it was not selling to -- there is not a slowdown in production of current vehicles that we see an impact. That's not really our particular market, it is more kind of the next-gen. So, I'll let -- again that's -- we talked about that before and that's my understanding as I touch and reach out to a lot of the customers themselves. So Brian, I'll let you add a little bit more.
Brian J. Soller -- Senior Vice President & General Manager, Lightwave Division
Yes, I think that's right. I mean if you look at commercial aerospace, that segment is obviously going to be hit pretty hard in 2020. Most of, or at least a good chunk of what we're doing there is in development programs for future products that will fly on commercial aircraft. So those revenues didn't fall into the 2020 window. On the R&D side, I think it will -- we'll see a slowdown there of selling individual systems into R&D labs. But that's not a huge chunk of our 2020 revenue. Energy, we have not seen an impact thus far. And in fact, we've just at the end of Q1 and even into Q2 seen some positive signs and some good activity there. So we don't necessarily expect a major impact there. And then in automotive I think everyone is in the same, but we have to kind of wait and see what happens with the macro situation. We don't tie as we've talked in the past our revenues to the level of car sales in a given timeframe, we're into longer-term R&D programs. We fully expect those to continue billing as we get into the middleweight part of 2020.
Barry Sine -- Spartan Capital -- Analyst
Okay, appreciate you're addressing that. My last -- third and last question, I want to address the cash balance. Obviously very significant, debt number is a nice round zero, any -- what are you looking to do with that cash at this point? Has that outlook changed and what I'm specifically wondering about are you seeing any acquisitions out there where a business might be under a bit more stress as a result of the COVID-19 situation and you might be able to come in and swoop in a little bit better terms even if that means that some of those cyclicality benefits you just talked about with the existing business don't exist with future acquisitions.
Scott A. Graeff -- President and Chief Executive Officer
Yes, well I would certainly say Barry that we continue to be active. And I said that on the last call that we were active and we continue to be active. And I would say it's safe to say that there are opportunities given what's going on in the market right now with some folks that might not have as strong a balance sheet or whatever it may be. And so that was always the purpose of that to turn that cash into an accretive use not sitting in the bank. But it is good in a time like this to add $1.5 million or $1.3 million whatever it was in Q1 to end with in Q1 with over $26 million. Like you said, no debt, access to the revolver that we have. But we are active and that is the use I think trying to grow non-organically is certainly part of Luna's go-forward strategy.
Barry Sine -- Spartan Capital -- Analyst
So just to follow up on that. Acquisitions is that may be under stress would be companies that perhaps have their business activity a little bit more tied to current production products unlike your businesses. Is that an area that you'd be willing to go into and expose yourself to a little bit more economic sensitivity, if you can get the right acquisition?
Scott A. Graeff -- President and Chief Executive Officer
I think if it was the right acquisition at the right price. I believe the two initiatives that from a communications test and from our sensing initiative, I believe one focused on the need for speed, one focused on pushing to the 5G, I don't think that's going away. I don't think that need for speed is going to back off. And on the fiber optic sensing slide, I don't believe that light-weighting is going away, I believe that people will continue to want to use different materials combining different mixes of materials and using fiber to test those lighter waiting materials. So if they fit, I would say all those are on the table to look at if it was the right company with the right culture, it would have to be accretive, we are not going to step, no matter what we're not going to step into something that is not additive to the top and the bottom immediately. So if it fits our discipline and it's a good company, certainly we would look at everything.
Barry Sine -- Spartan Capital -- Analyst
Okay, thank you very much, gentlemen.
Scott A. Graeff -- President and Chief Executive Officer
Thanks, Barry.
Operator
[Operator Instructions]
Scott A. Graeff -- President and Chief Executive Officer
I'll let everyone know on the call. We apologize, for the first time since I've been doing this for 14 years at Luna, we are experiencing problems with our online reader [Phonetic] view template here and we are not able to communicate, other than on this call out loud with our operator and I don't know whether you are queuing up for questions that we cannot see. So I apologize, it's the first time that I have experienced in the 14 years that Luna has been public. So let me throw that out there, I apologize if you're in the queue trying to ask a question and we can't get it asked.
Operator
You have a question from the line of Charles Nolls [Phonetic], Private Investor.
Charles Nolls -- Private Investor
Good afternoon.
Scott A. Graeff -- President and Chief Executive Officer
Hey, how are you?
Charles Nolls -- Private Investor
You can hear me, OK good. If you think you have problems like that you might have to give a phone number for people to call. When I was [Indecipherable] they had done this thing with [Indecipherable] labs, where they determine the purity of prepackaged pharmaceuticals with kind of percent accuracy and I always thought that was going to be where the money was, I'm out doing my hikes, so I'm a little bit winded. But in physiology one of the things I remember this concentration of oxygen and carbon dioxide changes on exploration if you're ill. And also, I don't remember [Indecipherable] if the airport when I'm thinking if the Terahertz could have some sort of detectors and have people call and [Indecipherable] a certain carbon complex like coronavirus, it might pick it up. And fantastic report, again proud of -- what's happened with the yearly meeting, I assume it's not going to be in New York.
Scott A. Graeff -- President and Chief Executive Officer
Yes Chuck, we're going to have to like many other public companies are going to have to do that virtually, I was going to mention that here before I signed off. So we're going to provide a I guess it's a dial-in number and you'll be able to dial in and login online and ask questions and we'll be available to answer questions at that as well. But we had an in-person presentation with all of management plan, kind of a mini Investor Day plan for our shareholder meeting, but that was -- it was scheduled to be in New York City. So the plans on that had to take a different direction, but we are planning on doing it virtually on Monday. Hopefully, you've got your proxy and saw the notice of that Chuck?
Charles Nolls -- Private Investor
Yes, I was hoping to go to this one, but let us know when you might be back open for visitors at the plant because I've wanting to do that. But now I'm retiring. So I can do that.
Scott A. Graeff -- President and Chief Executive Officer
Just reach out to us, we will schedule time for myself or Brian to meet you there and take it -- go through it.
Charles Nolls -- Private Investor
Sounds great.
Scott A. Graeff -- President and Chief Executive Officer
I appreciate it.
Operator
At this time there are no further questions. I would now like to turn the call back to Scott for any closing remarks.
Scott A. Graeff -- President and Chief Executive Officer
I think we're going to wrap this up operator. So thanks everyone for joining us today. We continue to believe that we're on the right path with the right vision and our financial and operational success during 2019 and the first part of 2020 underscores this belief. We also continue to believe that our potential is significant and that we are witnessing a market shift that could accelerate the adoption of the capabilities provided by Luna. As I mentioned on our Q4 call, what we're seeing now is a true market pull where some very significant players have realized the impact of incorporating optical fiber sensors into their products and are coming to us for assistance. Like I just mentioned, we are going to hold our annual meeting -- Annual Shareholder Meeting virtually on Monday, May 11 at 12 noon Eastern. Due to the pandemic and like many public companies, we shifted this meeting from in-person to virtual. If you are a shareholder, details on how to join are in our proxy statement located on the SEC.gov's website or on Luna's Investor Relations section of its website. With that I'd like to thank you for your time and interest in Luna Innovations. Thank you.
Operator
[Operator Closing Remarks]
Duration: 42 minutes
Call participants:
Allison Woody -- Director of Administration
Scott A. Graeff -- President and Chief Executive Officer
Gene Nestro -- Chief Financial Officer
Brian J. Soller -- Senior Vice President & General Manager, Lightwave Division
Barry Sine -- Spartan Capital -- Analyst
Charles Nolls -- Private Investor
