Coherent reports mixed third quarter results

01 Aug 2015

Revenue and profit downward shifts were "partially offset" by a healthy sequential expansion in gross profit percentage.

Diversified photonics systems and laser developer Coherent has announced financial results for its third fiscal quarter 2015. Quarter sales totaled $188.5m ($203.7m in Q2 2015) while non-GAAP net income was $20.6m, or $0.82 per share compared with previous year equivalents of $18.2m, or $0.73 per share – equating to increases of 13.1% and 12.%, respectively.

Bookings received during Q3 2015 were $176.7m. This result compares to bookings of $244.5m in the same prior year period and $220.6 million in the immediately preceding quarter. The book-to-bill ratio was 0.94, and ending backlog expected to ship in the next 12 months was $305.2m at July 4, 2015, compared to $315.3m at April 4, 2015 and $344.3m at June 28, 2014.

John Ambroseo, Coherent’s President and CEO, commented, “We had a number of significant events during our third fiscal quarter. We were prepared to make an expedited shipment of our third Triple Vyper/Linebeam 1500 system in Q3 when the customer requested that we revert to the original ship date in September 2015.

"This does not change our overall outlook for the flat panel display market. The revenue and profit shifts were partially offset by a healthy sequential expansion in our gross profit percentage, attributable to a favorable mix and lower warranty costs.”

Ups and downs

Leen Simonet Coherent’s Executive VP and CFO described the highs and lows contained in the Q3 figures: “The high point of this quarter’s performance is the sizable step up in the company’s gross profit percentage, which led to a sequential increase in EBITDA percent to 18.4% compared to 17.6% in the previous quarter.

She continued, “Net sales for Q3 of $188.5m declined $8m [4.1%] compared to the same quarter a year ago, the result of the unfavorable exchange rate fluctuations. Compared to the previous quarter, net sales decreased $15.2 million or 7.5%, which is partially due to the Linebeam 1500 ELA system shift to the fourth quarter and a slowdown in semiconductor investments. In addition, our medical ophthalmic revenues declined following a very strong second quarter.”

New products

Ambroseo added that the company had in recent years been investing in a number of new product platforms: “We introduced several of them at Lasers Munich in June 2015. Our second-generation fiber laser platform delivers power scalability and modularity for metal cutting and joining applications.

"The Monaco is a next generation short-pulse industrial laser suitable for many uses including medical therapeutics and medical device manufacturing. Our third major product release was a 5-micron version of our Diamond Series platform. Based upon carbon monoxide, this device should play a key role in next generation via drilling and thin film/glass cutting.”

Acquisitions

The company also announced that it recently completed two targeted acquisitions. First, it purchased the assets of Raydiance, a private company which specialized in short-pulse laser processing. Raydiance had an installed base of over 100 tools for automotive fuel injector nozzle drilling and medical device manufacturing. Coherent will offer existing and new solutions for these markets as well as provide paid service and parts for the installed base.

Coherent said it also intends to leverage the Raydiance technology to develop new applications for lasers and tools in consumer electronics manufacturing. Second, the company acquired the Tinsley Optics business from L3 Communications, which had been supplying the very large form factor optics for the Coherent’s Linebeam 1500 excimer laser annealing system.

About the Author

Matthew Peach is a contributing editor to optics.org.