Exhibit 99.1
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CONTACT:
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Tim Mammen
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David Calusdian |
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Chief Financial Officer
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Executive Vice President |
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IPG Photonics Corporation
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Sharon Merrill Associates, Inc. |
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(508) 373-1100
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(617) 542-5300 |
IPG PHOTONICS REPORTS 27% INCREASE IN SALES IN FIRST QUARTER OF 2008
Fiber Lasers for Materials Processing Applications and Strong Overseas Sales
Drive Revenue Growth
OXFORD, Mass. — May 6, 2008 — IPG Photonics Corporation (Nasdaq: IPGP), the world leader in
high-power fiber lasers and amplifiers, today reported that revenues for the first quarter of 2008
increased by 27% to $52.9 million and net income increased by 23% to $8.1 million from the first
quarter of 2007. Revenue growth for the quarter was driven by sales of the Company’s fiber lasers
used for materials processing applications, which increased by 34% over the first quarter of 2007
to $44.2 million, as well as strong sales to European and Asian markets.
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Three Months Ended |
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March 31, |
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2008 |
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2007 |
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% Change |
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Revenue |
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$ |
52.9 |
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$ |
41.8 |
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27% |
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Gross margin |
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46.1 |
% |
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46.3 |
% |
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Operating income |
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$ |
12.5 |
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$ |
11.1 |
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13% |
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Operating margin |
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23.7 |
% |
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26.5 |
% |
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Net income |
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$ |
8.1 |
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$ |
6.6 |
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23% |
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Earnings per diluted share |
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$ |
0.18 |
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$ |
0.15 |
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20% |
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Operating income increased 13% to $12.5 million for the first quarter of 2008, up from $11.1
million for the same period in 2007. Earnings per diluted share increased 20% to $0.18 from $0.15
a year ago. Operating expenses for the first quarter of 2008 were $11.9 million, or 22% of
revenue, compared with $8.3 million, or 20% of revenue, in the first quarter of 2007.
Cash and cash equivalents were $38.7 million on March 31, 2008, compared with $38.0 million on
December 31, 2007, primarily as a result of $5.4 million of cash provided by operating activities,
proceeds from the sale of marketable securities of $4.5 million and net proceeds from the Company’s
credit lines of $3.3 million, offset by capital expenditures and investments in intangible assets
of $13.0 million. In addition to cash and cash equivalents, short-term and long-term investments
in auction rate securities were $2.5 million at March 31, 2008.
IPGP
Q4 Results/2
Comments on the First Quarter
“The growing acceptance of fiber lasers across a variety of applications, combined with our
presence in the major markets for industrial lasers across the globe, resulted in another quarter
of strong top- and bottom-line growth,” said Dr. Valentin Gapontsev, IPG Photonics’ Chief Executive
Officer. “Strong shipments in the European Union and continued expansion into the high-growth
markets of Russia, India, China and South Korea more than offset the softness we experienced in the
U.S. which accounts for only 18% of our sales.”
“In the first quarter of this year, pulsed laser sales increased 73% over the prior year, driven by
strong demand for marking and photovoltaic (solar) applications. Pulsed lasers are IPG’s largest
revenue generator. Gross margins in Q1 grew to 46% from 43% in the fourth quarter, due to higher
absorption of fixed costs as a result of improved yields and increased production, part of which
resulted in an increase in inventories. We have overcome the production issues which impacted
diode yields in the fourth quarter of 2007” added Dr. Gapontsev.
Business Outlook and Financial Guidance
“In international markets, we continue to see robust growth from existing OEMs, new customers and
our presence in key high-growth Asian markets. In the U.S. and elsewhere, we are seeing
substantially increased order flow in materials processing and telecommunications from the
beginning of the year. Some of these orders will ship in the second quarter and the remainder is
expected to ship during the following six to nine months” stated Dr. Gapontsev.
For the second quarter of 2008, IPG Photonics expects revenues in the range of $52 million to $56
million. The Company anticipates earnings per diluted share in the range of $0.15 to $0.19 based
on 46,041,000 common shares, which include 44,095,000 basic common shares outstanding and 1,946,000
potentially dilutive options at March 31, 2008.
Conference Call Reminder
The Company will hold a conference call to review its financial results and business highlights
today, May 6, 2008 at 10:00 a.m. ET. The conference call will be webcast live over the Internet
and can be accessed on the Investors section of the Company’s website at www.ipgphotonics.com. The
conference call also can be accessed by dialing (877) 548-7903 or (719) 325-4871. Interested
parties that are unable to listen to the live call may access an archived version of the webcast on
IPG’s website.
About IPG Photonics Corporation
IPG Photonics is the world leader in high-power fiber lasers and amplifiers. Founded in 1990, IPG
pioneered the development and commercialization of optical fiber-based lasers for use in a wide
range of applications such as materials processing, advanced applications, telecommunications and
medical applications. Fiber lasers have revolutionized the industry by delivering superior
performance, reliability and usability at a lower total cost of ownership compared with
conventional lasers, allowing end users to increase productivity and decrease operating costs. IPG
has its headquarters in Oxford, Massachusetts, and has additional plants and offices throughout the
world. For more information, please visit www.ipgphotonics.com.
IPGP
Q4 Results/3
Safe Harbor Statement
Information and statements provided by the Company and its employees, including statements in this
press release, that relate to future plans, events or performance are forward-looking statements.
These statements involve risks and uncertainties. Any statements in this press release that are
not statements of historical fact are forward-looking statements, including, but not limited to,
those relating to increasing demand for the Company’s products from existing and new OEMs, diode
yields, improved gross margins, growth rates in Asia, increased orders in the U.S. and elsewhere,
expected shipment dates for new orders, and the Company’s revenue and EPS guidance for the second
quarter of 2008. Factors that could cause actual results to differ materially include risks and
uncertainties, including risks associated with the Company’s ability to penetrate new applications
for fiber lasers and increase market share, the rate of acceptance and penetration of IPG’s
products, effective management of growth, level of fixed costs from its vertical integration,
intellectual property infringement claims and litigation, interruption in supply of key components,
contract cancellations, manufacturing risks, competitive factors including declining average
selling prices, building and expanding field service and support operations, uncertainties
pertaining to customer orders, demand for products and services, development of markets for the
Company’s products and services and other risks identified in the Company’s SEC filings. Readers
are encouraged to refer to the risk factors described in the Company’s Annual Report on Form 10-K
(filed with the SEC on March 13, 2008) and its periodic reports filed with the SEC, as applicable.
Actual results, events and performance may differ materially. Readers are cautioned not to rely on
the forward-looking statements, which speak only as of the date hereof. The Company undertakes no
obligation to update the forward-looking statements that may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of unanticipated events.
IPGP-G