02 May 2017
CEO Gapontsev hails results driven by “rapid growth of core products, applications and geographies”.IPG Photonics, the leading provider of high-power fiber lasers and amplifiers, has reported “record” financial results for the first quarter of this year, which ended March 31.
Comparing the latest quarter’s trading with the equivalent period in 2016 shows that IPG’s revenue is up 38% to $285.8m, operating income up 45% to $101.5m, while operating margin was also up to 35.5% from 33.8%.
Dr. Valentin Gapontsev, IPG's CEO, commented, “Our first quarter results have been driven by rapid growth across our core products, applications and geographies. First quarter revenue and earnings per share were above the high end of our guidance as the pace at which our fiber lasers are replacing conventional lasers and non-laser technology appears to be accelerating. During the first quarter we achieved record sales of $285.8m, while EPS of $1.38 increased 50% year over year."
Materials processing sales increased 33% year-over-year in the first quarter and accounted for approximately 92% of total sales driven by strength in cutting and welding. Sales to other markets were up 140% year-over-year driven by strong sales in telecom and advanced applications.
Demand within IPG's core materials processing business was especially strong in China, which grew 89% year over year in the first quarter. Sales of high-power lasers increased 42% year over year from rapid growth in cutting and welding applications while sales of QCW lasers increased 148% year over year driven by growth in welding and percussion hole drilling.
During the first quarter of 2017, IPG generated $50.8m in cash from operations and used $21.9m to finance capital expenditures. IPG ended the quarter with $862.8m in cash and cash equivalents and short-term investments, representing an increase of $32.2m from December 31, 2016.
"We achieved record orders during the quarter, with a book-to-bill ratio greater than one. Based on our current backlog, we believe we are in excellent position to deliver strong results again in the second quarter," said Dr. Gapontsev.
The company is expecting next quarter revenue to be in the range $320m to $340m: “IPG anticipates earnings per diluted share in the range of $1.50 to $1.70 based on 54,370,000 diluted common shares, which includes 53,368,000 basic common shares outstanding and 1,002,000 potentially dilutive options at March 31, 2017.”
Dr. Gapontsev added, "The magnitude of our first quarter out-performance and second quarter revenue guidance has exceeded our expectations when compared to those assumed in our annual guidance of 10% to 14% revenue growth in 2017.
"As such, we believe the stronger-than-expected performance and guidance for the first half of the year should be treated as additive to our full-year revenue growth outlook. However, it should not be used, at this time, as an assumption for out-performance in the second half of the year. While order flow remains strong, our visibility into the back half of the year, particularly the fourth quarter, remains somewhat limited."