Proto Labs, Inc. (NYSE:PRLB) Q4 2014 Earnings Conference Call - Final Transcript

Feb 05, 2015 • 08:30 am ET

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Proto Labs, Inc. (NYSE:PRLB) Q4 2014 Earnings Conference Call - Final Transcript

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Presentation
Operator
operator

Greetings and welcome to the Proto Labs Fourth Quarter 2014 Earnings Call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host Bill Dietrick, thank you sir, you may begin.

Executive
Bill Dietrick

Thank you, operator and good morning everyone. This morning before the market opened Proto Labs issued a press release announcing its fourth quarter and full-year financial results for the period ended December 31, 2014. The release is available on the company's website at protolabs.com,.

(Forward-Looking Cautionary Statement)

Now I'd like to turn the call over to Vicky Holt, President and Chief Executive Officer of Proto Labs. Vicky.

Executive
Vicky Holt

Thanks Bill. Good morning, everyone. Thank you for joining us today on our fourth quarter 2014 conference call. With me today on the call is John Way, our new Chief Financial Officer. John joined us in December and he had a very busy two months coming up to speed on the company while closing the 2014 books. John is a seasoned financial executive with a lot of experience in managing high-growth companies. He has been the CFO for two private equity backed companies as well as several divisions of UnitedHealth Group including Optum collaborative care.

At Optum, John played a key role in developing and executing the strategy that took the business from its creation to $3 billion in revenue. We are very happy he is here and believe he will be a significant asset in helping Proto Labs, get to the next level.

This morning, I'd like to begin with an overview of our 2014 financial and operational results, including an update on our new services and the Fineline integration. I'll also provide a little color on our strategy for 2015. Then John will offer you more detailed look at our quarterly financial results and our outlook for the first quarter of 2015. Following that we will be happy to take your questions.

Proto Labs once again achieved record quarterly revenue for the fourth quarter of 2014. Revenue totaled $56.1 million, a 27% increase over the fourth quarter of 2013. This includes $3.9 million of revenue from Additive Manufacturing Services through our Fineline acquisition. Without this fourth quarter revenue would have been $52.2 million, an increase of 18% over the prior year.

I would like to note that Fineline grew 48% over Q4 2013 reflecting the benefits of the combined organization. We experienced record quarterly revenue on a local currency basis. Revenue in North America increased 35% year-over-year. In Europe overall sales revenue in local currency increased 10% from the fourth quarter of 2013. But when translated to dollars, revenue growth was 3%.

While we continue to experience relatively flat demand in our Protomold parts business, it was offset by strong growth in Protomold and Firstcut with both of these services setting sales record in the quarter. We remain cautious regarding the outlook for