LAKE MARY, Fla., Feb. 23, 2011 /PRNewswire/ -- FARO Technologies, Inc. today announced results for the fourth quarter ended December 31, 2010. Sales in the fourth quarter of 2010 increased 27.1%, to $58.5 million, from $46.0 million in the fourth quarter of 2009. The Company reported net income of $4.8 million, or $0.29 per share, compared to a net loss of $0.04 per share in the fourth quarter of 2009.
Fiscal 2010 sales were $191.8 million, an increase of 29.9%, compared to fiscal 2009 sales of $147.7 million. New order bookings for fiscal 2010 were $197.9 million, an increase of 30.5%, from $151.7 million in fiscal 2009. Net income for fiscal 2010 was $11.1 million compared to net loss of $10.6 million in fiscal 2009.
New order bookings for the fourth quarter of 2010 were $67.4 million, an increase of $14.3 million, or 26.9%, compared to $53.1 million in the fourth quarter of 2009.
"The fourth quarter was extremely strong for us, a significant accomplishment compared to the fourth quarter of 2009 when sales started to improve," stated Jay Freeland, FARO's President and CEO. "Asia continued its rapid expansion, growing sales 43% in the fourth quarter and more than 50% for the year. We finished 2010 with approximately $23 million in backlog, our highest level ever, providing a solid foundation for the first quarter of 2011. Finally, the launch of the new Focus 3D Laser Scanner exceeded our expectations. Orders for the Focus in the fourth quarter of 2010 were substantially higher than any total year for the previous laser scanner models. We believe this reflects the disruptive nature of this product, with its cutting edge performance and market-leading size, weight, ease of use and price."
Gross margin for the fourth quarter of 2010 was 59.0%, compared to 55.4% in the fourth quarter of 2009. Gross margin increased primarily due to an increase in the proportion of higher margin product sales relative to lower margin service revenue.
"Overall, 2010 was an outstanding year. We had excellent sales growth and ground-breaking product introductions. We capitalized on the cost leverage we created in 2009 which added substantially to the bottom line and also allowed for the introduction of both the FARO Focus 3D and the FARO AMP. The Company is positioned well for 2011, with equally exciting product introductions lined-up and additional capacity to leverage our structure. We did not issue any guidance in 2009 and 2010 and we will not be issuing specific guidance for 2011. However, we maintain the view that our markets remain highly underpenetrated and we believe we have the ongoing opportunity to achieve the annual 20-25% sales growth rates we historically achieved. Our top priority continues to be strengthening our position as the leader in this space," Freeland concluded.
This press release contains forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that are subject to risks and uncertainties, such as statements about FARO's focus, plans and strategies, and its future operating results and financial condition. Statements that are not historical facts or that describe the Company's plans, objectives, projections, expectations, assumptions, strategies, or goals are forward-looking statements. In addition, words such as "intend," "believe," "will," "expect" and similar expressions or discussions of our strategy or other intentions identify forward-looking statements. Forward-looking statements are not guarantees of future performance and are subject to various known and unknown risks, uncertainties, and other factors that may cause actual results, performances, or achievements to differ materially from future results, performances, or achievements expressed or implied by such forward-looking statements. Consequently, undue reliance should not be placed on these forward-looking statements.
Factors that could cause actual results to differ materially from what is expressed or forecasted in such forward-looking statements include, but are not limited to:
-- development by others of new or improved products, processes or technologies that make the Company's products obsolete or less competitive; -- the cyclical nature of the industries of the Company's customers and material adverse changes in customers' access to liquidity and capital; -- declines or other adverse changes, or lack of improvement, in industries that the Company serves or the domestic and international economies in the regions of the world where the Company operates and other general economic, business, and financing conditions; -- fluctuations in the Company's annual and quarterly operating results and the inability to achieve its financial operating targets; -- risks associated with expanding international operations, such as fluctuations in currency exchange rates, difficulties in staffing and managing foreign operations, political and economic instability, compliance with import and export regulations, and the burdens and potential exposure of complying with a wide variety of U.S. and foreign laws and labor practices; -- other risks detailed in Part I, Item 1A. Risk Factors in the Company's Annual Report on Form 10-K for the year ended December 31, 2009.
Forward-looking statements in this release represent the Company's judgment as of the date of this release. The Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.
About FARO
With over 20,000 installations and 11,000 customers globally, FARO Technologies, Inc. designs, develops, and markets portable, computerized measurement and imaging devices and software used to create digital models -- or to perform evaluations against an existing model -- for anything requiring highly detailed 3-D measurements, including part and assembly inspection, factory planning and asset documentation, as well as specialized applications ranging from surveying, recreating accident sites and crime scenes to digitally preserving historical sites.
FARO's technology increases productivity by dramatically reducing the amount of on-site measuring time, and the various industry-specific software packages enable users to process and present their results quickly and more effectively.
Principal products include the world's best-selling portable measurement arm -- the FaroArm; the world's best-selling laser tracker -- the FARO Laser Tracker X and Xi; the FARO Laser ScanArm; FARO Photon Laser Scanners; the FARO Gage, Gage-PLUS and PowerGAGE; and the CAM2 Q family of advanced CAD-based measurement and reporting software. FARO Technologies is ISO-9001 certified and ISO-17025 laboratory registered.
FARO TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended ------------------ (in thousands, except share and per Dec 31, Dec 31, share data) 2010 2009 ----------------------------------- -------- -------- SALES Product $49,456 $38,422 Service 9,059 7,604 ----- ----- Total Sales 58,515 46,026 ------ ------ COST OF SALES Product 17,775 15,646 Service 6,204 4,897 ----- ----- Total Cost of Sales (exclusive of depreciation and amortization, shown separately below) 23,979 20,543 ------ ------ GROSS PROFIT 34,536 25,483 OPERATING EXPENSES: Selling 15,710 12,164 General and administrative 7,300 6,365 Depreciation and amortization 1,492 1,440 Research and development 3,854 3,047 ----- ----- Total operating expenses 28,356 23,016 ------ ------ INCOME (LOSS) FROM OPERATIONS 6,180 2,467 ----- ----- OTHER (INCOME) EXPENSE Interest income (22) (28) Other (income) expense, net 983 (233) Interest expense 3 5 --- --- INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT) 5,216 2,723 INCOME TAX EXPENSE 377 3,344 --- ----- NET INCOME (LOSS) $4,839 $(621) ------ ----- NET INCOME (LOSS) PER SHARE - BASIC $0.30 $(0.04) ----- ------ NET INCOME (LOSS) PER SHARE - DILUTED $0.29 $(0.04) ----- ------ Weighted average shares - Basic 16,179,531 16,101,412 ---------- ---------- Weighted average shares - Diluted 16,424,638 16,101,412 ---------- ---------- Twelve Months Ended ------------------- (in thousands, except share and per Dec 31, Dec 31, share data) 2010 2009 ----------------------------------- -------- -------- SALES Product $157,331 $117,714 Service 34,444 29,989 ------ ------ Total Sales 191,775 147,703 ------- ------- COST OF SALES Product 54,571 46,293 Service 23,806 20,702 ------ ------ Total Cost of Sales (exclusive of depreciation and amortization, shown separately below) 78,377 66,995 ------ ------ GROSS PROFIT 113,398 80,708 OPERATING EXPENSES: Selling 50,679 48,598 General and administrative 26,776 24,956 Depreciation and amortization 6,326 5,530 Research and development 12,690 12,613 ------ ------ Total operating expenses 96,471 91,697 ------ ------ INCOME (LOSS) FROM OPERATIONS 16,927 (10,989) ------ ------- OTHER (INCOME) EXPENSE Interest income (105) (253) Other (income) expense, net 2,783 (592) Interest expense 34 14 --- --- INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT) 14,215 (10,158) INCOME TAX EXPENSE 3,147 424 ----- --- NET INCOME (LOSS) $11,068 $(10,582) ------- -------- NET INCOME (LOSS) PER SHARE - BASIC $0.69 $(0.66) ----- ------ NET INCOME (LOSS) PER SHARE - DILUTED $0.68 $(0.66) ----- ------ Weighted average shares - Basic 16,153,831 16,125,449 ---------- ---------- Weighted average shares - Diluted 16,365,826 16,125,449 ---------- ---------- FARO TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS December December 31, 31, (in thousands, except share data) 2010 2009 --------------------------------- ---- ---- ASSETS Current Assets: Cash and cash equivalents $50,722 $35,078 Short-term investments 64,986 64,986 Accounts receivable, net 51,862 42,944 Inventories, net 28,242 26,582 Deferred income taxes, net 4,455 4,473 Prepaid expenses and other current assets 8,045 6,016 ----- ----- Total current assets 208,312 180,079 ------- ------- Property and Equipment: Machinery and equipment 24,840 19,867 Furniture and fixtures 5,700 5,225 Leasehold improvements 9,682 9,434 ----- ----- Property and equipment at cost 40,222 34,526 Less: accumulated depreciation and amortization (24,982) (20,788) ------- ------- Property and equipment, net 15,240 13,738 ------ ------ Goodwill 19,015 19,934 Intangible assets, net 7,204 7,985 Service inventory 13,726 12,079 Deferred income taxes, net 2,522 1,895 ----- ----- Total Assets $266,019 $235,710 -------- -------- LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable $12,025 $8,985 Accrued liabilities 15,208 8,173 Income taxes payable 1,138 229 Current portion of unearned service revenues 13,357 12,226 Customer deposits 3,679 2,173 Current portion of obligations under capital leases 91 80 --- --- Total current liabilities 45,498 31,866 Unearned service revenues - less current portion 6,758 5,910 Deferred income taxes, net 1,161 1,143 Obligations under capital leases -less current portion 125 193 --- --- Total Liabilities 53,542 39,112 ------ ------ Shareholders' Equity: Common stock -par value $.001, 50,000,000 shares authorized; 16,894,374 and 16,795,289 issued; 16,214,139 and 16,115,054 outstanding, respectively 17 17 Additional paid-in-capital 156,310 152,380 Retained earnings 57,983 46,915 Accumulated other comprehensive income 7,242 6,361 Common stock in treasury, at cost -680,235 shares (9,075) (9,075) ------ ------ Total Shareholders' Equity 212,477 196,598 ------- ------- Total Liabilities and Shareholders' Equity $266,019 $235,710 -------- -------- FARO TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31, ------------------------ (in thousands) 2010 2009 2008 -------------- ---- ---- ---- CASH FLOWS FROM: OPERATING ACTIVITIES: Net income (loss) $11,068 $(10,582) $13,952 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 6,326 5,530 4,505 Compensation for stock options and restricted stock units 2,392 2,449 2,237 Provision for bad debts 2,408 1,852 1,092 Deferred income tax (benefit) expense (693) 1,986 (1,972) Change in operating assets and liabilities: Decrease (increase) in: Accounts receivable (13,018) 5,769 2,993 Inventories, net (6,273) 8,301 (6,429) Prepaid expenses and other current assets (2,172) 1,964 (1,187) Income tax benefit from exercise of stock options (133) (4) (45) Increase (decrease) in: Accounts payable and accrued liabilities 10,435 (7,891) (5,317) Income taxes payable 829 (1,749) (355) Customer deposits 1,474 1,736 82 Unearned service revenues 2,338 (396) 3,710 ----- ---- ----- Net cash provided by operating activities 14,981 8,965 13,266 ------ ----- ------ INVESTING ACTIVITIES: Purchases of property and equipment (4,047) (3,387) (9,705) Payments for intangible assets (979) (670) (3,766) Purchases of short- term investments - (64,986) (81,965) Proceeds from sales of short-term investments - 81,965 77,375 --- ------ ------ Net cash (used in) provided by investing activities (5,026) 12,922 (18,061) ------ ------ ------- FINANCING ACTIVITIES: Proceeds from notes payable 2,490 - - Payments on notes payable (2,490) - - Payments on capital leases (84) (88) (11) Income tax benefit from exercise of stock options 133 4 45 Purchases of treasury stock - (8,829) (95) Proceeds from issuance of stock, net 1,405 83 92 ----- --- --- Net cash provided by (used in) financing activities 1,454 (8,830) 31 ----- ------ --- EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS $4,235 $(1,473) $2,460 ------ ------- ------ INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 15,644 11,584 (2,304) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 35,078 23,494 25,798 ------ ------ ------ CASH AND CASH EQUIVALENTS, END OF PERIOD $50,722 $35,078 $23,494 ======= ======= =======
FARO Technologies, Inc.
CONTACT: Keith Bair, Senior Vice President and CFO of FARO,
+1-407-333-9911, keith.bair@FARO.com
Web Site: http://www.faro.com/
