LAKE MARY, Fla., Feb. 27, 2013 /PRNewswire/ -- FARO
Technologies, Inc. (NASDAQ: FARO) today announced results for the
fourth quarter ended December 31,
2012. Sales in the fourth quarter of 2012 increased
4.7% to $80.7 million, from
$77.1 million in the fourth quarter
of 2011. The Company reported net income decreased to
$7.8 million, or $0.46 per share, in the fourth quarter of 2012,
from $9.5 million, or $0.56 per share, in the fourth quarter of
2011.
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Fiscal 2012 sales were $273.4
million, an increase of 7.6% compared to fiscal 2011 sales
of $254.2 million. Net income
for fiscal 2012 was $23.0 million
compared to $23.4 million in fiscal
2011. The decline in net income was attributable in part to
legal fees of $3.7 million in fiscal
2012, compared with $1.3 million in
2011, associated with the FCPA Monitor and the Nikon Patent case,
both of which were substantially and favorably resolved during
2012. Cash flow from operating activities for 2012 was
$27.9 million, compared to
$8.7 million in 2011.
New order bookings for the fourth quarter of 2012 were
$82.1 million, an increase of
$5.0 million, or 6.5%, compared to
$77.1 million in the fourth quarter
of 2011. New order bookings for fiscal 2012 were $276.2 million, an increase of 8.0% from
$255.7 million in fiscal
2011.
"Performance in the fourth quarter and for the full year was
solid in light of the economic headwinds we faced in most of our
end markets. Although customer interest was strong throughout
the year and our new products were well received, deal closure
rates were slower reflecting continued economic uncertainty,"
stated Jay Freeland, FARO's
President & CEO.
Sales of the Focus Laser Scanner were particularly strong.
Gross margins on this product are lower than the Company's other
products primarily because of greater reliance on the distribution
channel compared to the Company's other products. However, those
sales involve minimal associated sales and marketing
expenses. Overall gross margin for the fourth quarter of 2012
was 53.4%, compared to 56.5% in the fourth quarter of 2011.
The Company's operating margin for the fourth quarter decreased
to 13.9%, compared to 16.7% in the fourth quarter of 2011 and
included approximately $0.4 million
of professional fees related to the Company's patent
litigation.
"Although our overall 2012 results were satisfactory, they did
not meet our expectations. In 2013, we anticipate continuing
market uncertainty. To address this and drive improved
performance, we expect to continue to strengthen our product
portfolio, increase sales coverage around the world, and tighten
cost controls across the Company's operations," 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 demand for its products, 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 FARO's plans 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;
- production delays caused by shortages of raw materials
incorporated in the Company's products;
- 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;
- risks associated with 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, 2011.
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
FARO is the world's most trusted source for
3D measurement technology. The Company develops and markets
computer-aided measurement and imaging devices and software.
Technology from FARO permits high-precision 3D measurement, imaging
and comparison of parts and complex structures within production
and quality assurance processes. The devices are used for
inspecting components and assemblies, rapid prototyping,
documenting large volume spaces or structures in 3D, surveying and
construction, as well as for investigation and reconstruction of
accident sites or crime scenes.
Approximately 15,000 customers are operating more than 30,000
installations of FARO's systems, worldwide. The Company's global
headquarters is located in Lake Mary,
FL; its European regional headquarters in Stuttgart, Germany; and its Asia/Pacific regional headquarters in
Singapore. FARO has offices in
Brazil, Mexico, United
Kingdom, France,
Spain, Italy, Poland, Netherlands, India, China,
Malaysia, Vietnam, Thailand and Japan.
More information is available at http://www.faro.com.
FARO
TECHNOLOGIES, INC. AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
|
Twelve
Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
thousands, except share and per share data)
|
Dec 31,
2012
|
|
Dec 31,
2011
|
|
|
Dec 31,
2012
|
|
Dec 31,
2011
|
SALES
|
|
|
|
|
|
|
|
|
Product
|
$
68,775
|
|
$
65,953
|
|
|
$
227,905
|
|
$
212,635
|
Service
|
11,895
|
|
11,127
|
|
|
45,490
|
|
41,529
|
Total
Sales
|
80,670
|
|
77,080
|
|
|
273,395
|
|
254,164
|
COST OF
SALES
|
|
|
|
|
|
|
|
|
Product
|
30,170
|
|
25,881
|
|
|
94,103
|
|
82,408
|
Service
|
7,431
|
|
7,687
|
|
|
29,673
|
|
28,067
|
Total Cost
of Sales (exclusive of depreciation and amortization,
shown separately below)
|
37,601
|
|
33,568
|
|
|
123,776
|
|
110,475
|
GROSS
PROFIT
|
43,069
|
|
43,512
|
|
|
149,619
|
|
143,689
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES:
|
|
|
|
|
|
|
|
|
Selling
|
18,413
|
|
17,960
|
|
|
64,446
|
|
62,117
|
General
and administrative
|
7,037
|
|
6,875
|
|
|
29,065
|
|
26,806
|
Depreciation and amortization
|
1,812
|
|
1,665
|
|
|
6,976
|
|
6,712
|
Research
and development
|
4,580
|
|
4,159
|
|
|
17,578
|
|
15,196
|
Total
operating expenses
|
31,842
|
|
30,659
|
|
|
118,065
|
|
110,831
|
INCOME
FROM OPERATIONS
|
11,227
|
|
12,853
|
|
|
31,554
|
|
32,858
|
OTHER
(INCOME) EXPENSE
|
|
|
|
|
|
|
|
|
Interest
income
|
(19)
|
|
(17)
|
|
|
(160)
|
|
(101)
|
Other
expense, net
|
529
|
|
442
|
|
|
744
|
|
1,217
|
Interest
expense
|
6
|
|
4
|
|
|
28
|
|
37
|
INCOME
BEFORE INCOME TAX EXPENSE
|
10,711
|
|
12,424
|
|
|
30,942
|
|
31,705
|
INCOME TAX
EXPENSE
|
2,870
|
|
2,952
|
|
|
7,944
|
|
8,328
|
NET
INCOME
|
$
7,841
|
|
$
9,472
|
|
|
$
22,998
|
|
$
23,377
|
NET INCOME
PER SHARE - BASIC
|
$
0.46
|
|
$
0.57
|
|
|
$
1.36
|
|
$
1.42
|
|
|
|
|
|
|
|
|
|
NET INCOME
PER SHARE - DILUTED
|
$
0.46
|
|
$
0.56
|
|
|
$
1.34
|
|
$
1.39
|
|
|
|
|
|
|
|
|
|
Weighted
average shares - Basic
|
16,966,063
|
|
16,668,567
|
|
|
16,910,830
|
|
16,503,773
|
|
|
|
|
|
|
|
|
|
Weighted
average shares - Diluted
|
17,074,074
|
|
16,940,438
|
|
|
17,129,128
|
|
16,868,430
|
FARO
TECHNOLOGIES, INC. AND SUBSIDIARIES
|
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
December
31,
|
(in
thousands, except share data)
|
|
2012
|
|
2011
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and
cash equivalents
|
|
$
93,233
|
|
$
64,540
|
Short-term
investments
|
|
64,990
|
|
64,997
|
Accounts
receivable, net
|
|
62,559
|
|
57,512
|
Inventories, net
|
|
48,894
|
|
49,934
|
Deferred
income taxes, net
|
|
7,216
|
|
5,297
|
Prepaid
expenses and other current assets
|
|
11,186
|
|
9,207
|
Total
current assets
|
|
288,078
|
|
251,487
|
Property
and Equipment:
|
|
|
|
|
Machinery
and equipment
|
|
32,236
|
|
29,171
|
Furniture
and fixtures
|
|
6,516
|
|
5,963
|
Leasehold
improvements
|
|
10,897
|
|
10,233
|
Property and equipment at
cost
|
|
49,649
|
|
45,367
|
Less:
accumulated depreciation and amortization
|
|
(34,305)
|
|
(29,134)
|
Property and equipment,
net
|
|
15,344
|
|
16,233
|
Goodwill
|
|
18,816
|
|
18,610
|
Intangible
assets, net
|
|
7,048
|
|
6,849
|
Service
inventory
|
|
19,125
|
|
17,316
|
Deferred
income taxes, net
|
|
2,396
|
|
2,296
|
Total
Assets
|
|
$
350,807
|
|
$
312,791
|
LIABILITIES AND SHAREHOLDERS'
EQUITY
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
10,413
|
|
$
13,396
|
Accrued
liabilities
|
|
18,216
|
|
18,076
|
Income
taxes payable
|
|
4,886
|
|
2,682
|
Current
portion of unearned service revenues
|
|
19,460
|
|
15,638
|
Customer
deposits
|
|
2,662
|
|
4,072
|
Current
portion of obligations under capital leases
|
|
45
|
|
84
|
Total current
liabilities
|
|
55,682
|
|
53,948
|
Unearned
service revenues - less current portion
|
|
11,221
|
|
9,540
|
Deferred
tax liability, net
|
|
1,149
|
|
1,148
|
Obligations under capital leases - less current
portion
|
|
19
|
|
257
|
Total
Liabilities
|
|
68,071
|
|
64,893
|
|
|
|
|
|
Shareholders' Equity:
|
|
|
|
|
Common
stock - par value $.001, 50,000,000 shares authorized; 17,653,879
and 17,381,110 issued; 16,973,644 and 16,700,875 outstanding,
respectively
|
|
18
|
|
17
|
Additional
paid-in capital
|
|
181,094
|
|
169,780
|
Retained
earnings
|
|
104,358
|
|
81,360
|
Accumulated other comprehensive income
|
|
6,341
|
|
5,816
|
Common
stock in treasury, at cost - 680,235 shares
|
|
(9,075)
|
|
(9,075)
|
Total
Shareholders' Equity
|
|
282,736
|
|
247,898
|
Total
Liabilities and Shareholders' Equity
|
|
$
350,807
|
|
$
312,791
|
FARO
TECHNOLOGIES, INC. AND SUBSIDIARIES
|
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years
Ended December 31,
|
|
|
|
|
|
|
|
(in
thousands)
|
|
2012
|
|
2011
|
|
2010
|
CASH FLOWS
FROM:
|
|
|
|
|
|
|
OPERATING
ACTIVITIES:
|
|
|
|
|
|
|
Net
income
|
|
$
22,998
|
|
$
23,377
|
|
$
11,068
|
Adjustments to reconcile net income to net cash
provided by
|
|
|
|
|
|
|
operating activities:
|
|
|
|
|
|
|
Depreciation and amortization
|
|
6,976
|
|
6,712
|
|
6,326
|
Compensation for stock options and restricted stock
units
|
|
4,018
|
|
2,727
|
|
2,392
|
Provision
for (net recovery of) bad debts
|
|
(23)
|
|
2,169
|
|
2,408
|
Deferred
income tax benefit
|
|
(2,016)
|
|
(672)
|
|
(693)
|
Change in
operating assets and liabilities:
|
|
|
|
|
|
|
Decrease
(increase) in:
|
|
|
|
|
|
|
Accounts
receivable
|
|
(4,840)
|
|
(8,979)
|
|
(13,018)
|
Inventories, net
|
|
(844)
|
|
(27,329)
|
|
(6,273)
|
Prepaid
expenses and other current assets
|
|
(1,870)
|
|
(1,417)
|
|
(2,172)
|
Income tax
benefit from exercise of stock options
|
|
(1,135)
|
|
(1,593)
|
|
(133)
|
Increase
(decrease) in:
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities
|
|
(3,079)
|
|
4,644
|
|
10,435
|
Income
taxes payable
|
|
3,497
|
|
2,998
|
|
829
|
Customer
deposits
|
|
(1,374)
|
|
668
|
|
1,474
|
Unearned
service revenues
|
|
5,565
|
|
5,384
|
|
2,338
|
Net cash provided by (used in) operating activities
|
|
27,873
|
|
8,689
|
|
14,981
|
|
|
|
|
|
|
|
INVESTING
ACTIVITIES:
|
|
|
|
|
|
|
Purchases
of property and equipment
|
|
(3,843)
|
|
(4,474)
|
|
(4,047)
|
Payments
for intangible assets
|
|
(1,361)
|
|
(890)
|
|
(979)
|
Net cash
used in investing activities
|
|
(5,204)
|
|
(5,364)
|
|
(5,026)
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
Proceeds
from notes payable
|
|
-
|
|
-
|
|
2,490
|
Payments
on notes payable
|
|
-
|
|
-
|
|
(2,490)
|
Payments
on capital leases
|
|
(132)
|
|
(163)
|
|
(84)
|
Income tax
benefit from exercise of stock options
|
|
1,135
|
|
1,593
|
|
133
|
Proceeds
from issuance of stock, net
|
|
6,162
|
|
9,150
|
|
1,405
|
Net cash
provided by financing activities
|
|
7,165
|
|
10,580
|
|
1,454
|
|
|
|
|
|
|
|
EFFECT OF
EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
|
|
(1,141)
|
|
(87)
|
|
4,235
|
|
|
|
|
|
|
|
INCREASE IN CASH AND CASH
EQUIVALENTS
|
|
28,693
|
|
13,818
|
|
15,644
|
|
|
|
|
|
|
|
CASH AND
CASH EQUIVALENTS, BEGINNING OF YEAR
|
|
64,540
|
|
50,722
|
|
35,078
|
|
|
|
|
|
|
|
CASH AND
CASH EQUIVALENTS, END OF YEAR
|
|
$
93,233
|
|
$
64,540
|
|
$
50,722
|
SOURCE FARO Technologies, Inc.