LAKE MARY, Fla., Feb. 23, 2011 /PRNewswire/ -- FARO Technologies,
Inc. (Nasdaq: FARO) 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
|
|
Twelve
Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except share and
per share data)
|
|
Dec 31,
2010
|
|
Dec 31,
2009
|
|
Dec 31,
2010
|
|
Dec 31,
2009
|
|
SALES
|
|
|
|
|
|
|
|
|
|
Product
|
|
$
49,456
|
|
$
38,422
|
|
$
157,331
|
|
$
117,714
|
|
Service
|
|
9,059
|
|
7,604
|
|
34,444
|
|
29,989
|
|
Total Sales
|
|
58,515
|
|
46,026
|
|
191,775
|
|
147,703
|
|
COST OF SALES
|
|
|
|
|
|
|
|
|
|
Product
|
|
17,775
|
|
15,646
|
|
54,571
|
|
46,293
|
|
Service
|
|
6,204
|
|
4,897
|
|
23,806
|
|
20,702
|
|
Total Cost of Sales
(exclusive of depreciation and amortization, shown separately
below)
|
|
23,979
|
|
20,543
|
|
78,377
|
|
66,995
|
|
GROSS PROFIT
|
|
34,536
|
|
25,483
|
|
113,398
|
|
80,708
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
Selling
|
|
15,710
|
|
12,164
|
|
50,679
|
|
48,598
|
|
General and
administrative
|
|
7,300
|
|
6,365
|
|
26,776
|
|
24,956
|
|
Depreciation and
amortization
|
|
1,492
|
|
1,440
|
|
6,326
|
|
5,530
|
|
Research and
development
|
|
3,854
|
|
3,047
|
|
12,690
|
|
12,613
|
|
Total operating
expenses
|
|
28,356
|
|
23,016
|
|
96,471
|
|
91,697
|
|
INCOME (LOSS) FROM
OPERATIONS
|
|
6,180
|
|
2,467
|
|
16,927
|
|
(10,989)
|
|
OTHER (INCOME)
EXPENSE
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
(22)
|
|
(28)
|
|
(105)
|
|
(253)
|
|
Other (income) expense,
net
|
|
983
|
|
(233)
|
|
2,783
|
|
(592)
|
|
Interest
expense
|
|
3
|
|
5
|
|
34
|
|
14
|
|
INCOME (LOSS) BEFORE INCOME TAX
EXPENSE (BENEFIT)
|
|
5,216
|
|
2,723
|
|
14,215
|
|
(10,158)
|
|
INCOME TAX EXPENSE
|
|
377
|
|
3,344
|
|
3,147
|
|
424
|
|
NET INCOME (LOSS)
|
|
$
4,839
|
|
$
(621)
|
|
$
11,068
|
|
$
(10,582)
|
|
NET INCOME (LOSS) PER SHARE -
BASIC
|
|
$
0.30
|
|
$
(0.04)
|
|
$
0.69
|
|
$
(0.66)
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) PER SHARE -
DILUTED
|
|
$
0.29
|
|
$
(0.04)
|
|
$
0.68
|
|
$
(0.66)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares -
Basic
|
|
16,179,531
|
|
16,101,412
|
|
16,153,831
|
|
16,125,449
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares -
Diluted
|
|
16,424,638
|
|
16,101,412
|
|
16,365,826
|
|
16,125,449
|
|
|
|
|
|
|
|
|
|
|
FARO
TECHNOLOGIES, INC. AND SUBSIDIARIES
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
December
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
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE FARO Technologies, Inc.