Rofin ends fiscal 2012 on high note, keeps conservative outlook

Three months after lowering its year-end outlook and expectations for fiber laser sales, Rofin-Sinar rebounded with some surprisingly strong numbers in its fiscal 4Q12, though it maintains the cautious optimism now catching hold among other laser systems providers.

Plymouth, MI - Three months after lowering its year-end outlook and expectations for fiber laser sales, Rofin-Sinar (NASDAQ: RSTI) has rebounded with some surprisingly strong numbers in its fiscal 4Q12 (ended Sept. 30), though it maintains the cautious optimism now catching hold among other laser systems providers.

RSTI's 4Q12 sales actually rose 12% Q/Q to $147M with earnings-per-share of $0.35, vs. expectations of $125M-$130M and $0.25-$0.28. "Net sales, net income, and earnings per share turned out better than we expected," stated Günter Braun, RSTI president/CEO. In the analyst conference call he pointed to "excellent demand" specifically in the consumer electronics and medical device sectors.

Incoming orders, though, decreased -5% to $137.4M (the book-to-bill ratio for F4Q12 was 0.93), and profits took a hit due to a less favorable product mix. Total laser shipments in 4Q12 were down about -9% from a year ago; Braun pointed to more lasers shipped with lower output power. Shipments for micro/laser marking increased ~4% thanks to a multiple-unit order -- but high-power/macro shipments dropped -27%.

By system, sales of laser products for macro applications decreased -18% from a year ago, while sales of lasers for marking and micro applications were down -13%. The laser components business was the lone bright spot, up +12%. Geographically, net sales dipped -10% in Europe and -22% in Asia, and were up 1% in North America.

For the full year fiscal year 2012, RSTI's sales and profits were both well below 2011 performance ($540M/-10% and $34.5M/-42%, respectively). Sales of lasers for macro apps were down -14%, lasers for marking/micro were down -10%, and components were up 8%; by geography, North American sales rose 8%, while Europe was down -11% and Asia decreased -16%.

RSTI had initially pledged to sell $80M in fiber lasers in fiscal 2012; the company ended the year with $66.5M in fiber laser sales, after being short of the halfway point as of last quarter ($38.3M), so fiber laser sales actually picked up substantially in fiscal 4Q12. In the next year, though, Braun projects 300 fiber laser sales, with some of that going to military and defense use.

Looking ahead to fiscal 1Q13, RSTI projects "continuing uncertainty regarding the global economy and the more cautious sentiment of our industrial customers" -- so it sees revenues sliding a bit to $130M-$135M, and EPS slipping to $0.25-$0.28. Micro laser apps are still "challenging," but Braun sees "slowly" building interest in more lasers for improving solar cell efficiencies.

Discussing the results, RSTI president/CEO Günter Braun noted good customer interest in China for CO2 and high-power fiber lasers, and solid demand in Europe and North America for medical devices. The automotive industry, he suggested, is "on the declining side" with weakening demand for smaller cars, as consumers feel the pressure of the European macroeconomic woes.

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