Laser Maker’s Profit Nearly Doubles Despite Dip In Sales

PLYMOUTH — Rofin-Sinar Technologies Inc. (NASDAQ: RSTI), the industrial laser maker with dual headquarters in Plymouth and Hamburg, Germany, reported net income of $11.5 million or 41 cents a share in its third fiscal quarter ended June 30, up from net income of $6.4 million or 23 cents a share in the same quarter a year earlier.

For the nine months, net income was $26.5 million or 94 cents a share, up from $13.2 million or 47 cents a share a year earlier. Revenue was $377.7 million, down frmo $384.1 million a year earlier.

“We delivered very strong third quarter results that demonstrate that our measures to increase efficiency and profitability are gaining momentum,” said RSTI president and CEO Thomas Merk. “Both net income and earnings per share rose by 78 percent year-over-year, and we steadily improved our gross margin. A favorable product mix, combined with more efficient production of our high-power fiber lasers and lower manufacturing costs of our third generation fiber lasers, improved our gross profit margin for the quarter to 39 percent of net sales, putting us within reach of our 40 percent target for the fourth fiscal quarter. Important highlights of the third quarter were an excellent sales level in the solar industry and a strong medical device business. From a geographical perspective, our North American and Asian businesses performed well, but European revenues continued to suffer from currency effects. Using last fiscal year’s average exchange rates, quarterly revenue would have been $146.8 million, representing a growth of more than 9 percent.”

Third quarter selling, general and administrative expenses, including additional costs of $1.1 million related to the recent CEO change, were $24.7 million or 19 percent of sales, down $1.2 million from last fiscal year’s third quarter. Net research and development expenses decreased by $1.4 million to $9.9 million, or 7 percent of sales, down from $11.3 million (which was 8 percent of net sales) in the third quarter of fiscal year 2014.

Sales of lasers for marking and micro applications rose 9 percent to $64.1 million, or 48 percent of sales. Sales of laser products for macro applications fell 14 percent to $48.7 million, or 37 percent of sales. Sales of components rose 5 percent to $19.7 million, or 15 percent of total sales.

Revenue in Asia rose 11 percent to $50.4 million, rose 10 percent in North America to $27.5 million, and fell 15 percent in Europe to $54.6 million.

Order entry for the quarter fell 10 percent to $130 million from third quarter of fiscal year 2014, resulting in a backlog of $157.5 million as of June 30.

The company said it expects fourth quarter sales of $135 million to $140 million and earnings per share of 48 to 53 cents.

Rofin currently has more than 52,000 laser units installed worldwide and serves more than 4,000 customers.

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

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