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EXCEL - IDEA: XBRL DOCUMENT - OPT SCIENCES CORPFinancial_Report.xls
EX-31 - EXHIBIT 31.1 CERTIFICATION - OPT SCIENCES CORPexhibit_31-1_2q_2013.htm
EX-32 - EXHIBIT 32.1 CERTIFICATION - OPT SCIENCES CORPexhibit_32-1_2q_2013.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 10-Q

(Mark One)
þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 27, 2013.
or
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to ______________.
   
   

Commission File Number: 0-1455

OPT-SCIENCES CORPORATION

(Exact name of registrant as specified in its charter)


NEW JERSEY 21-0681502
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)

1912 BANNARD STREET, CINNAMINSON, NEW JERSEY 08077
(Address of principal executive offices) (Zip Code)

(856) 829-2800

(Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES þ NO o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES þ NO o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o Accelerated filer o
Non-accelerated filer o Smaller reporting company þ
(Do not check if smaller reporting company)    

Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act). YES o NO þ


Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date: 775,585 Shares of Common Stock, par value $0.25, were outstanding as of June 11, 2013.



Opt-Sciences Corporation
FORM 10-Q SECOND QUARTER REPORT - FISCAL YEAR 2013

TABLE OF CONTENTS

    Page
PART I FINANCIAL INFORMATION  
     
Item 1. Financial Statements. 3
     
  Consolidated Balance Sheets as of April 27, 2013 (unaudited) and October 27, 2012. 3
     
  Consolidated Statements of Income and Comprehensive Income (unaudited) for three and six months ended April 27, 2013 and three and six months ended April 28, 2012. 5
     
  Consolidated Statements of Retained Earnings (unaudited) for three and six months ended April 27, 2013 and three and six months ended April 28, 2012. 5
     
  Consolidated Statements of Cash Flows (unaudited) for six months ended April 27, 2013 and six months ended April 28, 2012. 6
     
  Notes to Consolidated Financial Statements. 7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. 9
Item 3 Quantitative and Qualitative Disclosures About Market Risk. 12
Item 4. Controls and Procedures. 12
PART II OTHER INFORMATION 13
Item 1. Legal Proceedings. 13
Item 1A. Risk Factors. 13
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 13
Item 3. Defaults Upon Senior Securities. 13
Item 4. Mine Safety Disclosures. 13
Item 5. Other Information. 13
Item 6. Exhibits. 13
  Signatures. 13

2



PART I   FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

Opt-Sciences Corporation

CONSOLIDATED BALANCE SHEETS

ASSETS

April 27, 2013   
     (Unaudited)     
October 27, 2012
CURRENT ASSETS    
     
Cash and cash equivalents $   1,928,736 $   2,834,374
Marketable securities 8,686,492 7,521,011
Trade accounts receivable 980,109 1,347,983
Inventories 782,913 652,533
Prepaid expenses 22,023 17,905
Loans and exchanges 7,952 8,942
Accrued interest receivable

     81,649

65,115

     
Total current assets

   12,489,874

12,447,863

     
PROPERTY AND EQUIPMENT    
Land 114,006 114,006
Building and improvements 582,747 578,553
Machinery and equipment 2,230,804 2,152,018
Automobiles

          43,268

43,268

     
Total property and equipment 2,970,825 2,887,845
Less accumulated depreciation

     2,226,895

2,153,786

     
Net property and equipment

        743,930

734,059

OTHER ASSETS
Deposits

            2,837

29,621

Total assets

$  13,236,641

$  13,211,543

3



Opt-Sciences Corporation

CONSOLIDATED BALANCE SHEETS

LIABILITIES AND STOCKHOLDERS' EQUITY

  April 27, 2013   
    (Unaudited)     
October 27, 2012
CURRENT LIABILITIES    
     
Accounts payable - trade $       115,685 $         77,424
Accrued income taxes 38,491 33,350
Accrued salaries and wages 142,365 213,800
Accrued professional fees 46,000 98,879
Deferred income taxes 162,029 107,151
Other current liabilities

32,289

38,888

     
Total current liabilities

536,859

569,492

     
STOCKHOLDERS' EQUITY    
     
Common capital stock -par value $0.25 per share -    
authorized and issued 1,000,000 shares 250,000 250,000
Additional paid in capital 272,695 272,695
Retained earnings 12,178,214 12,202,801
Accumulated other comprehensive income:    
Unrealized holding gain on marketable securities 186,091 103,773
Less treasury stock at cost - 224,415 shares

(187,218)

(187,218)

Total stockholders' equity

12,699,782

12,642,051

Total liabilities and stockholders' equity

$  13,236,641

$  13,211,543

4



Opt-Sciences Corporation

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited)

  Three Months
Ended
April 27, 2013
Three Months
Ended
April 28,2012
Six Months
Ended
April 27, 2013
Six Months
Ended
April 28, 2012
         
NET SALES $  1,727,163 $  1,629,022 $  3,087,774 $  3,015,636
COST OF SALES

1,046,790

1,218,354

1,955,351

2,239,235

Gross profit on sales

680,373

410,668

1,132,423

776,401

         
OPERATING EXPENSES        
Sales & delivery 1,428 3,967 29,487 10,007
General & administrative

256,166

218,564

527,351

443,370

Total operating expenses

257,594

222,531

556,838

453,377

Operating income 422,779 188,137 575,585 323,024
         
OTHER INCOME

118,961

65,238

223,658

170,033

Income before taxes 541,740 253,375 799,243 493,057
         
FEDERAL AND STATE INCOME TAXES

216,700

103,900

319,700

202,200

Net income

325,040

149,475

479,543

290,857

         
OTHER COMPREHENSIVE INCOME        
Unrealized holding gains on        
marketable securities, net of taxes

62,559

99,409

186,091

24,770

Comprehensive Income

$     387,599

$     248,884

$     665,634

$     315,627

         
EARNINGS PER SHARE OF        
COMMON STOCK

$          0.42

$           0.19

$          0.62

$          0.38

         
Average shares of stock outstanding

       775,585

       775,585

       775,585

       775,585

CONSOLIDATED STATEMENTS OF RETAINED EARNINGS (Unaudited)

  Three Months
Ended
April 27, 2013
Three Months
Ended
April 28, 2012
Six Months
Ended
April 27, 2013
Six Months
Ended
April 28, 2012
         
RETAINED EARNINGS - beginning of period 11,853,174 11,405,544 12,202,801 11,264,162
Net income

325,040

149,475

479,543

290,857

  12,178,214 11,555,019 12,682,344 11,555,019
         
Less: Dividends paid

-0-

-0-

504,130

-0-

RETAINED EARNINGS - end of period

$ 12,178,214

$ 11,555,019

$ 12,178,214

$ 11,555,019

5



Opt-Sciences Corporation

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

  Six Months Ended
April 27, 2013
Six Months Ended
April 28, 2012
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income $     479,543 $     290,857
Adjustments to reconcile net income to net    
cash provided (used) by operating activities:    
Depreciation 73,110 70,988
(Gain) loss on sales of securities (10,391) 34,900
Decrease (increase) in:    
Accounts receivable 367,874 (205,257)
Inventories (130,380) (53,219)
Prepaid expenses (4,118) 13,204
Prepaid income taxes -0- (60,018)
Loans and exchanges 990 2,900
Accrued interest receivable (16,534) 7,862
Deposits 26,784 -0-
(Decrease) increase in:    
Accounts payable 38,261 63,884
Accrued income taxes 5,141 (172,010)
Accrued salaries and wages (71,435) (48,751)
Accrued professional fees (52,879) (40,000)
Other current liabilities

(6,599)

6,398

Net cash provided (used) by operating activities 699,367 (88,262)
     
CASH FLOWS FROM INVESTING ACTIVITIES:    
Purchases of fixed assets (82,980) (8,620)
Purchases of securities (1,756,194) (315,408)
Proceeds from sales of securities

738,299

255,412

Net cash (used) provided by investing activities

(1,100,875)

(68,616)

     
CASH FLOWS FROM FINANCING ACTIVITIES:    
Dividends paid

(504,130)

-0-

     
(Decrease) in cash (905,638) (156,878)
     
Cash and cash equivalents at beginning of period

2,834,374

1,751,489

     
Cash and cash equivalents at end of period

$   1,928,736

$   1,594,611

     
SUPPLEMENTAL DISCLOSURES:    
Income taxes paid

$      264,559

$      434,228

6



Opt-Sciences Corporation

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying consolidated financial statements include the accounts of Opt-Sciences Corporation, Inc. and its wholly-owned subsidiary, O and S Research, Inc. (collectively, the "Company"). All significant intercompany accounts and transactions have been eliminated in consolidation.

These consolidated financial statements have been prepared by the Company, without audit, and reflect normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the results for the first six months of the Company's fiscal year 2013. These consolidated financial statements do not include all disclosures associated with annual consolidated financial statements and, accordingly, should be read in conjunction with footnotes contained in the Company's consolidated financial statements for the year ended October 27, 2012 together with the auditors' report filed as part of the Company's 2012 Annual Report on Form 10-K.

The three and six months that ended April 27, 2013 represent thirteen and twenty-six weeks respectively. The three and six months that ended April 28, 2012 represent thirteen and twenty-six weeks respectively.

The preparation of these consolidated financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

2. INVENTORIES

Inventories consisted of the following:

April 27, 2013
  (Unaudited)  
October 27, 2012
Raw materials and supplies $    348,760   $    340,694
Work in progress 212,667   127,260
Finished goods

221,486

 

184,579

Total Inventory

$    782,913

 

 $    652,533

End of quarter inventories are stated at the lower of cost (first-in, first-out) or market. The inventory included in unaudited quarterly financial statements and in this Form 10-Q is based on estimates derived from an unaudited physical inventory count of work-in-progress and raw materials. The Company provides for estimated obsolescence on unmarketable inventory based upon assumptions about future demand and market conditions. If actual demand and market conditions are less favorable than those projected by management, additional inventory write downs may be required. Inventory, once written down, is not subsequently written back up, as these adjustments are considered permanent adjustments to the carrying value of the inventory. The Company conducts an audited physical inventory at the end of the fiscal year in connection with its audited financial statements and preparation of its Form 10-K.

3.  REVENUE RECOGNITION

The Company recognizes revenue in accordance with U.S. GAAP and SEC Staff Accounting Bulletin ("SAB") No. 104, Revenue Recognition. SAB No. 104 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the price to the buyer is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed nature of the price to the buyer charged for products delivered or services rendered and collectability of the sales price. The Company assesses credit worthiness of customers based upon prior history with the customer and assessment of financial condition. The Company shipping terms are customarily FOB shipping point.

7



4.  FINANCIAL INSTRUMENTS

SFAS No. 157 (ASC 820), "Fair Value Measurements", requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. SFAS No. 157 (ASC 820) establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

SFAS No. 157 (ASC 820) prioritizes the inputs into three levels that may be used to measure fair value:

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
   
Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
   
Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company's financial instruments consist principally of cash, cash equivalents, marketable securities, trade accounts receivable, accounts payable and accrued liabilities. Pursuant to SFAS No. 157 (ASC 820), the fair value of our cash equivalents and marketable securities is determined based on "Level 1" inputs, which consist of quoted prices in active markets for identical assets. The Company believes that the recorded values of all of the other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

5.    RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In May 2011, the FASB issued guidance related to measuring and disclosing fair values. The Company's adoption of the updated guidance effective October 28, 2012 did not have any impact on the Company's results of operations, financial position or liquidity.

In June 2011, the FASB amended the presentation of comprehensive income. The amendments in this update give us the option to present the total comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. We adopted this amendment on October 28, 2012 and elected to present other comprehensive income in a single continuous statement, Consolidated Statements of Income and Comprehensive Income.

In December 2011, the provisions of Accounting Standards Codification (ASC) Topic 210, "Balance Sheet", were amended to require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of these arrangements on its financial position. In January 2013, the provisions of ASC Topic 210 were further amended to clarify that the scope of the previous amendment only applies to derivative instruments, including separated bifurcated derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are either eligible for offset in the balance sheet or are subject to an agreement similar to a master netting agreement. The guidance requires entities to disclose both gross information and net information about assets and liabilities within the scope of the amendment. These provisions are effective for interim and annual reporting periods beginning on or after January 1, 2013. The adoption of this guidance effective January 27, 2013 will not affect our financial position or results of operations.

In February 2013, the provisions of ASC Topic 220, "Comprehensive Income", were amended to require an entity to disclose information about the amounts reclassified out of accumulated other comprehensive income by component. For amounts required to be reclassified out of accumulated other comprehensive income in their entirety in the same reporting period, the guidance requires entities to present significant amounts by the respective line items of net income, either on the face of the income statement or in the notes to the financial statements. For other amounts that are not required to be reclassified to net income in their entirety, a cross-reference is required to other disclosures that provide additional details about those amounts. These provisions are effective for annual reporting periods beginning after December 15, 2012. We do not anticipate that the adoption of this guidance will have a material impact on our financial position or results of operations.

8



6.  SUBSEQUENT EVENTS

The Company is not aware of any event that occurred subsequent to the balance sheet date but prior to the filing of this report that could have a material impact on our financial position or results of operations.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

We make statements in this Report, and we may from time to time make other statements, regarding our outlook or expectations for earnings, revenues, expenses and/or other matters regarding or affecting the Company that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Forward-looking statements are typically identified by words such as "believe", "expect", "anticipate", "intend", "outlook", "estimate", "forecast", "project" and other similar words and expressions. Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made. We do not assume any duty and do not undertake to update our forward-looking statements. Actual results or future events could differ, possibly materially, from those that we anticipated in our forward-looking statements, and future results could differ materially from our historical performance. Our forward-looking statements are subject to the following principal risks and uncertainties:

-   Uncertain demand for the Company's products because of the current international financial concerns;
-   Risks associated with dependence on a few major customers; and
-   The performance, financial strength and reliability of the Company's vendors.

We provide greater detail regarding other factors in our 2012 Form 10-K.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Management's discussion and analysis of financial condition and results of operations are based upon the Company's consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Specifically, inventory is estimated quarterly and reconciled at the end of the fiscal year when a comprehensive physical count is conducted (also see Notes to Consolidated Financial Statements, Note 1 Summary of Significant Accounting Policies and Note 2 Inventories).

9



EXECUTIVE SUMMARY

Opt-Sciences Corporation, through its wholly owned subsidiary, O and S Research, Inc., both New Jersey corporations, manufactures anti-glare and transparent conductive optical coatings which are deposited on glass used primarily to cover instrument panels in aircraft cockpits. The Company's business is highly dependent on a robust commercial, business, regional and military aircraft market. We recorded second quarter sales of $1,727,163 and net income of $325,040. Sales are up 27% or $366,552 from the first quarter of Fiscal Year 2013. Compared to the second quarter of 2012, sales are up 6% or $ 98,141. We currently expect third quarter sales to be approximately $1,500,000. Sales seem to have rebounded from recent lows. We look for an increase in sales of conductive coated instrument panels and improved sales in all our major markets. Nevertheless, international financial concerns combined with political unrest in the Middle East (resulting in higher oil prices) may affect aircraft users and purchasers by inhibiting their ability to finance and their desire to purchase new airplanes and their ability and desire to upgrade existing aircraft. During the second quarter of 2013, the Company booked $1,706,000 in new orders compared to $1,404,000 in new orders booked for the first quarter of 2013 and $1,949,000 in new orders booked in the second quarter of 2012. Our backlog of unshipped orders was approximately $2,082,000 at the end of the second quarter, down $20,000 from the end of the first quarter of 2013 and down $1,021,000 from the second quarter of 2012. The much higher backlog at the end of the same period last year was primarily due to an inventory buildup by one of our major customers causing a temporary spike in demand.

Even though we have a significant backlog, a substantial portion of that backlog is scheduled for delivery in later periods of this Fiscal Year. Based on their needs which change from time to time, our customers may accelerate or defer delivery dates; and we typically try to accommodate their needs if we have available manufacturing capacity and access to the required raw materials. We generally have a four to twelve week delivery cycle depending on product complexity, plant capacity and lead time for raw materials, such as polarizers or filter glass. Our sales tend to fluctuate from quarter to quarter, because all orders are custom manufactured and customer orders are generally scheduled for delivery based on our customer's need date and not based on our ability to make shipments. Since the Company has two customers that together represented over 42% of sales this quarter, any significant change in the requirements of either of those customers has a direct impact on our revenue for a quarter.

RESULTS OF OPERATIONS - SECOND QUARTER

THIRTEEN WEEKS ENDED APRIL 27, 2013 COMPARED WITH THIRTEEN WEEKS ENDED APRIL 28, 2012

NET SALES
Net sales for the second quarter were $1,727,163 which is $98,141 and 6% more than the net sales of $1,629,022 for the same quarter last year.

COST OF SALES
Cost of sales for the second quarter decreased $171,564 or 14% to $1,046,790 or 61% of sales, compared to $1,218,354 or 75% of sales, for the second quarter last year. The decrease in cost of sales despite a small increase in sales was primarily due to the higher operating efficiencies experienced during the second quarter resulting in lower material costs and lower direct labor costs. Cost of sales is comprised of raw materials, manufacturing direct labor and overhead expenses. The overhead portion of cost of sales is primarily comprised of salaries, benefits, building expenses, production supplies, and maintenance costs related to our production, inventory control and quality departments.

GROSS PROFIT
Gross profit for the second quarter increased $269,705 to $680,373 or 39% of sales from $410,668 or 25% of sales reported for the same quarter last year.

OPERATING EXPENSES
Operating expenses increased $35,063 to $257,594 from $222,531 for the same quarter last year. This increase was primarily due to an increase in sales. Operating expenses consist of marketing and business development expenses, professional expenses, salaries and benefits for executive and administrative personnel, hiring, legal, accounting, and other general corporate expenses.

10



OPERATING INCOME
The Company realized operating income of $422,779 or 24% of sales for the second quarter compared to an operating income of $188,137 or 11% of sales, for the same quarter last year.

OTHER INCOME
Other income of $118,961 for the second quarter increased by $53,723 from the same quarter last year. This difference was primarily related to recognizing a net loss on the sale of securities in the prior year's second quarter.

PROVISONS FOR INCOME TAX
Income tax expense for the second quarter was $216,700 or 40% of pre tax income compared to $103,900 and 41% of pre tax income for the comparable prior period.

NET INCOME
There was net income for the second quarter of $325,040 or $0.42 per share compared to $149,475 or $0.19 per share for second quarter  of Fiscal 2012.

TWENTY-SIX WEEKS ENDED APRIL 27, 2013 COMPARED WITH TWENTY-SIX WEEKS ENDED APRIL 28, 2012

NET SALES
Net sales for the twenty-six weeks ended April 27, 2013 were $3,087,774 which is $72,138 and 2% more than the net sales of $3,015,636 for the same twenty-six week period last year.

COST OF SALES
Cost of sales for the twenty-six weeks ended April 27, 2013 was $1,955,351 or 63% of sales, compared to $2,239,235 or 74% of sales, for the same period last year. The decrease in cost of sales despite a small increase in sales was primarily due to the higher operating efficiencies experienced during the second quarter resulting in lower material costs and lower direct labor costs.

GROSS PROFIT
Gross profit for the twenty-six weeks ended April 27, 2013 increased $356,022 to $1,132,423 or 36% of sales, from $776,401 or 26% of sales reported for the same period last year. The increase in total gross profit was due to  higher operating efficiencies and margins than for the same period last year.

OPERATING EXPENSES
Operating expenses increased by $103,461 to $556,838 during the twenty-six week period ended April 27, 2013 from $453,377 during the twenty-six week period last year. This was due primarily to higher travel expenses and higher legal expenses.

OPERATING INCOME
The Company realized operating income of $575,585 or 18% of sales, for the twenty-six week period ended April 27, 2013, compared to operating income of $323,024 or 11% of sales, for the same period last year. The increase in operating income is primarily due to higher operating efficiencies.

11



OTHER INCOME
Other income of $223,658 for the twenty-six week period ended April 27, 2013 increased $53,625 from $170,033 for the same period for last year. This difference was primarily related to recognizing a net loss on the sale of securities in the prior year's second quarter.

INCOME TAX
Income tax expense for the twenty-six week period ended April 27, 2013 was $319,700 and 40% of pre tax income, compared to $202,200 and 41% of total income for the twenty-six week period ended April 28, 2012.

NET INCOME
Net income for the twenty-six week period ended April 27, 2013 increased $188,686 to $479,543 or $0.62 per share, compared to net income of $290,857 or $0.38 per share for the prior comparable period, primarily because of the increased operating efficiencies then experienced in the prior year.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a "smaller reporting Company" as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by Item 3.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures. Based on an evaluation which is conducted quarterly by our management, including our Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), as of April 27, 2013  he has concluded that our disclosure controls and procedures (as defined in Rules 13a- 15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act") are effective to reasonably ensure that information required to be disclosed in reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls. There were no changes in our internal controls during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, these controls over financial reporting.

12



PART II   OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are subject from time to time to certain claims and litigation in the ordinary course of business. It is the opinion of management that the outcome of such matters will not have a material adverse impact on our combined financial position or results of operations.

ITEM 1A. RISK FACTORS

Smaller reporting companies are not required to provide the information required by this item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

The registrant does not have in place procedures by which stockholders may recommend nominees to the registrant's Board of Directors.

ITEM 6. EXHIBITS

  31.1 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
  32.1 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
  101. Financial statements from the Quarterly Report of Form 10-Q of Opt-Sciences Corporation for the period ending April 27, 2013 as interactive data files formatted in XBRL: (i) The Consolidated Balance Sheet, (ii) the Consolidated Statement of Operations, (iii) the Consolidated Statements of Cash Flows, and (iv) the Notes to the Consolidated Financial Statements.
  101.INS XBRL Instance Document.
  101.SCH XBRL Taxonomy Extension Schema Document.
  101.CAL XBRL Taxonomy Extension Calculation Linkbase Document.
  101.DEF XBRL Taxonomy Extension Definition Linkbase Document.
  101.LAB XBRL Taxonomy Extension Label Linkbase Document.
  101.PRE XBRL Taxonomy Extension Presentation Linkbase Document.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Opt-Sciences Corporation
 
/s/ Anderson L. McCabe      
Anderson L. McCabe
Chief Executive Officer &
Chief Financial Officer
June 11, 2013

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