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Proc-Type: 2001,MIC-CLEAR
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<SEC-DOCUMENT>0000912057-03-000229.txt : 20030515
<SEC-HEADER>0000912057-03-000229.hdr.sgml : 20030515
<ACCEPTANCE-DATETIME>20030515170104
ACCESSION NUMBER:		0000912057-03-000229
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20030515
ITEM INFORMATION:		Financial statements and exhibits
ITEM INFORMATION:		Regulation FD Disclosure
FILED AS OF DATE:		20030515

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PRECISION OPTICS CORPORATION INC
		CENTRAL INDEX KEY:			0000867840
		STANDARD INDUSTRIAL CLASSIFICATION:	ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845]
		IRS NUMBER:				042795294
		STATE OF INCORPORATION:			MA
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-10647
		FILM NUMBER:		03705943

	BUSINESS ADDRESS:	
		STREET 1:		22 EAST BROADWAY
		CITY:			GARDNER
		STATE:			MA
		ZIP:			01440-3338
		BUSINESS PHONE:		9786301800

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PRECISION OPTICS CORP INC
		DATE OF NAME CHANGE:	19600201
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>a2111245z8-k.txt
<DESCRIPTION>8-K
<TEXT>

<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                             -----------------------

                                    FORM 8-K

                                 CURRENT REPORT
                     PURSUANT TO SECTION 13 OR 15(D) OF THE
                       THE SECURITIES EXCHANGE ACT OF 1934

                Date of report (Date of earliest event reported):
                                May 15, 2003

                       PRECISION OPTICS CORPORATION, INC.

                    -----------------------------------------

             (Exact name of registrant as specified in its charter)

<TABLE>
<S>                                 <C>                   <C>
Massachusetts                         001-10647             04-2795294
- -------------                       --------------        ---------------
(State or other jurisdiction of      (Commission          (I.R.S. Employer
of incorporation or organization)    File Number)         Identification No.)
</TABLE>

                 22 East Broadway, Gardner, Massachusetts 01440
                 ----------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

       Registrant's telephone number, including area code: (978) 630-1800

<PAGE>


Item 7. Financial Statements and Exhibits.

         (c) Exhibits

<Table>
<Caption>
Exhibit Number                         Title
- --------------                         -----
<S>                                   <C>
  99.1                                 Press Release, dated May 15, 2003
</Table>


Item 9. Regulation FD Disclosure (Information Provided Under Item 12,
        Disclosure of Results of Operations and Financial Condition).

         The information contained in this Item 9 is furnished pursuant to
Item 12 of Form 8-K, Results of Operations and Financial Condition, and is
included under Item 9 in accordance with SEC Release No. 33-8216.

         On May 15, 2003 the Registrant issued the press release attached as
Exhibit 99.1 announcing operating results on an unaudited basis for the third
quarter and nine months of fiscal year 2003 ended March 31, 2003.


<PAGE>

                                    SIGNATURE

         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 hereunto duly authorized.

                                 PRECISION OPTICS CORPORATION, INC.

Date: May 15, 2003               By: /s/ Jack P. Dreimiller
                                     ------------------------------------------
                                     Name: Jack P. Dreimiller
                                     Title: Senior Vice President, Finance and
                                            Chief Financial Officer

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>3
<FILENAME>a2111245zex-99_1.txt
<DESCRIPTION>EX-99.1
<TEXT>
<PAGE>

EXHIBIT 99.1

NEWS RELEASE
===============================================================================
FOR IMMEDIATE RELEASE                                    THURSDAY, MAY 15, 2003

                      PRECISION OPTICS CORPORATION ANNOUNCES

                              THIRD QUARTER RESULTS

GARDNER, Massachusetts - Precision Optics Corporation, Inc. (Nasdaq: POCI) today
announced operating results on an unaudited basis for the third quarter and nine
months of fiscal year 2003 ended March 31, 2003. All shares and per share data
reflect the effects of a 1-for-6 reverse stock split that became effective on
January 29, 2003.

THIRD QUARTER HIGHLIGHTS

     o Revenues for the quarter were $903,068, up 53.1% sequentially and up
       151.6% from the prior year, to the highest level in seven quarters.

     o Gross margin improved from a negative 29.9% last year to a positive 34.1%
       in the current quarter.

     o Net loss for the third quarter was reduced by $.7 million from a year ago
       to $416,713, or $.24 per share compared to $.65 per share last year.

     o Cash and cash equivalents were $3.8 million at quarter end.

     o Prototypes of an innovative specialty endoscope were shipped to a major
       new customer in March, leading to an initial production order of
       approximately $335,000.

     o Patent and trademark applications were filed for advanced technology
       related to autoclavable endoscope design and endoscope manufacturing.

OPERATING RESULTS

Revenues for the quarter ended March 31, 2003 were $903,068 compared to $358,896
for the same period in fiscal year 2002, an increase of 151.6%. Revenues for the
quarter increased 53.1% sequentially from the preceding quarter. Net loss was
$416,713 compared to a net loss of $1,140,950 last year. Basic and diluted loss
per share was $0.24 in the current quarter ended March 31, 2003, versus $0.65
per share for the comparable period last year. The weighted average common
shares outstanding were 1,752,052 during both periods. In the preceding quarter
ended December 31, 2002, net loss was $710,986, or $0.41 per share.

<PAGE>

For the nine months ended March 31, 2003, revenues were $2,035,270 compared to
$1,173,306 for the same period last year, an increase of 73.5%. Net loss,
including charges for asset impairment and restructuring of $53,131, was
$1,919,590 or $1.10 per share, compared to a net loss of $8,642,180, or $4.93
per share, for the same period last year. Last year's net loss included charges
for asset impairment, restructuring and inventory write-down totaling
$4,652,628. The weighted average common shares outstanding were 1,752,052 during
both periods.

The increase in revenues for the quarter and nine months ended March 31, 2003
was due primarily to higher sales of stereo endoscope products.

CUSTOMER RELATIONSHIPS

In March the Company shipped prototypes of a new specialty endoscope for cardiac
surgical applications to a significant new customer. Following a successful
evaluation of these prototypes and a rigorous audit of the Company's quality
system and processes, the customer placed initial production orders totaling
approximately $335,000. Production and shipment is to begin during the quarter
ending June 30, 2003.

Also in March, the Company's principal customer for stereo endoscopes and
cameras announced that it has entered into a merger agreement to be acquired by
another of the Company's customers (pending shareholder approval). Sales to this
customer accounted for 67% and 50% of total revenues for the quarter and nine
months ended March 31, 2003, respectively. It is uncertain as to what effects
the pending merger will have on the Company's relationship with this customer
and whether future business prospects will materialize. While this customer has
expressed satisfaction with the Company's stereo endoscope products to date,
currently the Company has no significant open orders from this customer for
future delivery. Since currently business with this customer is very important
to the Company, the loss of such business would have a material adverse effect
on the Company's operations and financial position. The Company continues its
vigorous pursuit of sales of a new generation of advanced endoscopes to this
customer, and further sales opportunities with other customers from new
non-stereo products recently brought to production in the past year.

TECHNICAL ACHIEVEMENTS

During the quarter, the Company filed two patent applications with the U.S.
Patent and Trademark Office related to its proprietary endoscope technology. The
first covers the Company's LENSLOCK(TM) technology, which improves ruggedness,
clarity and image sharpness, and is applicable to essentially all instruments in
the Company's endoscope product line. The second application was filed for an
innovative design for autoclavable endoscopes. The major benefits of
autoclavable instruments include increased patient safety, quick turnaround, and
elimination of hazardous sterilant and by-product materials, all of which
enhance value

<PAGE>

to the user. The Company believes its autoclavable endoscope technology will
continue to generate significant opportunities for endoscope revenue growth.

OUTLOOK

For the quarter ended March 31, 2003, the total of cash and cash equivalents
plus receivables decreased by approximately $349,000 from December 31, 2002,
compared to a decrease of approximately $526,000 for the quarter ended December
31, 2002, and approximately $807,000 for the quarter ended September 30, 2002,
continuing this positive sequential trend. Cash and cash equivalents decreased
by approximately $801,000 for the quarter ended March 31, 2003, compared to a
decrease of approximately $500,000 for the quarter ended December 31, 2002. This
increased cash usage is attributable primarily to higher inventory purchases and
customer receivables to support the higher sales level in the quarter ended
March 31, 2003. Receivables at March 31, 2003 increased by approximately
$452,000 during the quarter and represented approximately 80% of third quarter
revenues. Also contributing to the higher receivables at March 31, 2003, and
thus the higher cash usage, was the pattern of shipments during the third
quarter. A significant amount of product shipments (over 50%) occurred during
the last month of the quarter ended March 31, 2003. As a result, cash receipts
in the quarter ending June 30, 2003 are expected to be significantly higher than
the previous quarter.

Capital equipment expenditures during the nine months ended March 31, 2003 were
approximately $22,000, down 69% from the nine months ended March 31, 2002.
Future capital expenditures will be dependent upon future sales and success of
on-going research and development efforts.

For the quarter ended March 31, 2003, research and development expenses were
approximately $253,000, down 49.7% from the $503,000 in the quarter ended March
31, 2002. It is anticipated that quarterly R&D expenses for the foreseeable
future will remain at this lower level, but is ultimately dependent upon the
Company's assessment of new product opportunities.

ABOUT PRECISION OPTICS

Precision Optics Corporation, a leading developer and manufacturer of advanced
optical instruments since 1982, designs and produces high-quality optical thin
film coatings, medical instruments, and other advanced optical systems. The
Company's medical instrumentation line includes laparoscopes, arthroscopes and
endocouplers and a world-class 3-D endoscope for use in minimally invasive
surgical procedures. Precision Optics Corporation is certified to the ISO 9001
Quality Standard, and complies with the FDA Good Manufacturing Practices and the
European Union Medical Device Directive for CE Marking of its medical products.
The Company's Internet Website is www.poci.com.

<PAGE>

               PRECISION OPTICS CORPORATION, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                       FOR THE THREE AND NINE MONTHS ENDED
                             MARCH 31, 2003 AND 2002
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                       -- THREE MONTHS --                  -- NINE MONTHS --
                                                        2003           2002               2003          2002
<S>                                                   <C>            <C>               <C>            <C>
REVENUES                                              $903,068       $358,896          $2,035,270     $1,173,306

COST OF GOODS SOLD                                     595,249        466,033           1,607,186      2,438,945
                                                     ---------    -----------         -----------    -----------
         Gross Profit (Loss)                           307,819       (107,137)            428,084     (1,265,639)
                                                     ---------    -----------         -----------    -----------

RESEARCH and DEVELOPMENT                               253,449        503,401             902,642      1,916,298

SELLING, GENERAL and
ADMINISTRATIVE EXPENSES                                487,064        553,045           1,420,384      1,501,214

PROVISION FOR ASSET IMPAIRMENT and
RESTRUCTURING                                                -              -              53,131      4,112,628
                                                     ---------    -----------         -----------    -----------
              Total Operating Expenses                 740,513      1,056,446           2,376,157      7,530,140
                                                     ---------    -----------         -----------    -----------

         Operating Loss                               (432,694)    (1,163,583)         (1,948,073)    (8,795,779)

INTEREST INCOME                                         15,318         30,017              54,423        166,650

INTEREST EXPENSE                                          (207)        (7,384)             (6,769)       (13,051)

GAIN (LOSS) ON SALE OF ASSETS HELD
FOR SALE                                                   870              -             (19,171)             -
                                                     ---------    -----------         -----------    -----------
         Net Loss                                    $(416,713)   $(1,140,950)        $(1,919,590)   $(8,642,180)
                                                     =========    ===========         ===========    ===========

Basic and Diluted Loss Per Share (1)                    ($0.24)        ($0.65)             ($1.10)        ($4.93)
                                                         =====          =====               =====          =====

Weighted Average Common Shares
    Outstanding (1)                                  1,752,052      1,752,052           1,752,052      1,752,052
                                                     =========      =========           =========      =========
</TABLE>

(1) After giving effect to a 1-for-6 reverse stock split that became effective
    on January 29, 2003.

<PAGE>

               PRECISION OPTICS CORPORATION, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                         March 31, 2003
                                                                            (UNAUDITED)           JUNE 30, 2002
                                                                           -------------          -------------
<S>                                                                         <C>                    <C>
                                    ASSETS

CURRENT ASSETS
         Cash and Cash Equivalents                                          $ 3,788,581            $ 5,825,601
         Accounts Receivable, Net                                               729,661                374,499
         Inventories                                                          1,241,855              1,009,009
         Refundable Income Taxes                                                      -                 13,849
         Prepaid Expenses                                                       168,596                 93,574
         Assets Held for Sale                                                   276,061                847,696
                                                                           -------------           -----------
                  Total Current Assets                                        6,204,754              8,164,228
                                                                           -------------           -----------
PROPERTY AND EQUIPMENT                                                        4,008,229              3,983,698
         Less: Accumulated Depreciation                                      (3,665,434)            (3,492,403)
                                                                           -------------           -----------
                  Net Property and Equipment                                    342,795                491,295
                                                                           -------------           -----------
OTHER ASSETS                                                                    239,232                224,516
                                                                           -------------           -----------
TOTAL ASSETS                                                               $  6,786,781            $ 8,880,039
                                                                           =============           ===========
                      LIABILITIES AND STOCKHOLDERS' EQUITY

TOTAL CURRENT LIABILITIES                                                    $  587,451               $746,524
                                                                           -------------           -----------
CAPITAL LEASE OBLIGATION AND OTHER                                                3,110                 17,705
                                                                           -------------           -----------

STOCKHOLDERS' EQUITY
         Common Stock, $.01 par value-
              Authorized -- 20,000,000 shares
              Issued and Outstanding - 1,752,052 shares
                  at March 31, 2003 and
                  June 30, 2002 (1)                                              17,521                 17,521
         Additional Paid-in Capital (1)                                      27,770,175             27,770,175
         Accumulated Deficit                                               ( 21,591,476)           (19,671,886)
                                                                           -------------           -----------
                  Total Stockholders' Equity                                  6,196,220              8,115,810
                                                                           -------------           -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                   $6,786,781             $8,880,039
                                                                           =============           ===========
</TABLE>

     (1) After giving effect to a 1-for-6 reverse stock split that became
     effective on January 29, 2003.

              Forward-looking statements contained in this news release,
     including those related to the Company's products under development and
     revenue estimates, are made under "safe harbor" provisions of the Private
     Securities Litigation Reform Act of 1995 and involve a number of risks and
     uncertainties that could materially affect future results. These risks and
     uncertainties, many of which are not within the Company's control, include,
     but are not limited to, the uncertainty and timing of the successful
     development of the Company's new products, the risks associated with
     reliance on a few key customers; the Company's ability to regain and
     maintain compliance with requirements for continued listing on the NASDAQ
     SmallCap Market; the Company's ability to attract and retain personnel with
     the necessary scientific and technical skills, the timing and completion of
     significant orders; the timing and amount of the Company's research and
     development expenditures; the timing

<PAGE>

     and level of market acceptance of customers' products for which the Company
     supplies components; performance of the Company's vendors; the ability of
     the Company to control costs associated with performance under fixed price
     contracts; and the continued availability to the Company of essential
     supplies, materials and services; and the other risk factors and cautionary
     statements listed from time to time in the Company's periodic reports filed
     with the Securities and Exchange Commission, including but not limited to,
     the Company's Annual Report on Form 10-KSB for the year ended June 30,
     2002.

                                       ###


</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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