Rofin-Sinar Profits Jump Despite Small Revenue Decline

PLYMOUTH — Rofin-Sinar Technologies Inc. (Nasdaq: RSTI), the industrial laser maker with dual headquarters in Plymouth and in Hamburg, Germany, posted net income of $12 million or 43 cents a share in the fourth fiscal quarter ended Sept. 30, up frmo $9.8 million or 35 cents a share in the same quarter a year earlier.

Revenue for the quarter was $146.1 million, down 1 percent from $147.6 million a year earlier.

For the full fiscal year, net income was $25.2 million or 89 cents a share, down from $34.8 million or $1.22 a share in the prior fiscal year. Revenue was $530.1 million, down from $560.1 million in the prior fiscal year.

“We delivered excellent financial performance in our fiscal fourth quarter as many of our initiatives began to show results,” Rofin-Sinar president and CEO Gunther Braun said in a statement. “Net sales met our expectations, while net income and earnings per share were better than we expected. Most importantly, we improved our gross profit margin to over 37 percent due to a favorable product mix and ongoing cost reduction measures in fiber lasers, a trend we expect to continue as we move toward our gross margin goal of 40 percent by the fourth quarter of fiscal year 2015. Clearly, our strategy is working, we are beginning to see the positive results of our R&D investments, and we remain well-positioned to create long-term shareholder value.”

Braun said the quarter was the best ever for sales in medical devices and the auto industry, while sales to the medical device and automotive industries, while sales to the machine tool, consumer electronics and semiconductor industries “remained solid.”

Barun said the company will “continue to see benefits from new product introductions, such as high-power fiber lasers and ultra-short-pulse lasers, and the use of our products in new applications, such as brittle material cutting. We are making excellent progress in the cost-efficient production of next generation high-power fiber lasers, which we will be introducing in calendar 2015. We believe we are well-positioned for 2015 and beyond, as we expect the launch of these next-generation products to significantly improve our market position and support future growth in revenue and profitability.”

The company said the quarter’s selling, general and admniistrative expenses were $27.1 million, 19 percent of sales, and up $3 million from a year earlier. The company said $1.2 million of the increase was one-time expenses, mostly involving the expansion and modernization of manufacturing plants. Net research and development expenses for the quarter were $11.5 million, up $1.5 million from a year earlier and representing 8 percent of sales.

Sales of laser products for macro applications rose 7 percent to $57.4 million and accounted for 39 percent of total sales. Sales of lasers for marking and micro applications fell 6 percent to $69.4 million and represented 48 percent of total sales. Sales of components fell 4 percent to $19.3 million and represented 13 percent of total sales.

On a geographical basis, revenue in North America fell year-over-year 7 percent to $28.2 million and by 9 percent in Europe to $65.8 million, while revenue in Asia rose 16 percent to $52.1 million.

For the twelve months ended Sept. 30, sales of lasers for macro applications fell 2 percent to $209.6 million while sales of lasers for marking and micro applications fell 9 percent to $250.2 million. Sales of components fell 3 percent to $70.3 million compared to fiscal year 2013.

On a geographical basis for the year, sales in North America fell 11 percent to $101.9 million from $114.9 million a year earlier. In Europe, sales rose 3 percent to $256.6 million from $250.3 million year earlier. In Asia, sales fell 12 percent to $171.6 million from $194.9 million a year earlier.

Order entry rose 14 percent to $141.3 million for the quarter and by 4 percent to $553.4 million for the fiscal year compared to the corresponding periods in fiscal year 2013. The backlog, mainly for laser products, amounted to $141.3 million as of Sept. 30.

The company said it expects sales between $127 million and $132 million for the first fiscal quarter, which will end Dec. 31, or 28 cents to 30 cents a share. At the midpoint of the guidance range, the first quarter outlook represents year-over-year growth of 7 percent in sales and 262 percent in earnings per share.

To listen to a conference call discussing these results, visit www.rofin.com.

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