Coherent Inc. (NASDAQ:COHR) Q1 2016 Earnings Conference Call - Final Transcript

Jan 28, 2016 • 04:30 pm ET

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Coherent Inc. (NASDAQ:COHR) Q1 2016 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to Coherent's First Fiscal Quarter 2016 Results Conference Call hosted by Coherent Inc. At this time, all participants are in a listen-only mode. At the conclusion of our prepared remarks, we will conduct a question-and-answer session. [Operator Instructions]. As a reminder this call is being recorded.

I would now like to introduce Ms. Leen Simonet, Executive Vice President and Chief Financial Officer. You may begin your conference.

Executive
Leen Simonet

Thank you, Shannon. Good afternoon and thank you for joining us on today's call. I will provide financial information and John Ambroseo, our President and CEO, will provide a business overview. As a reminder, any guidance and any statements in today's conference call pertaining to future guidance, market trends, plans, events or performance, are forward-looking statements that involve risks and uncertainties, and actual results may differ significantly.

We encourage you to refer to the risk disclosures and critical accounting policies described in the Company's reports on Forms 10-K, 10-Q and 8-K, as applicable and as filed from time-to-time by the Company. The full text of today's prepared remarks and trended GAAP and non-GAAP supplemental financial information will be posted on the Coherent Investor Relations website. A replay of this webcast will also be made available for approximately 90 days following the call.

Let me start by giving the financial highlights of the quarter. We are delighted with our first quarter earnings report as many of our metrics turned very positive. Our first quarter bookings of $273 million is a record for the Company and was primarily driven by record flat panel display bookings. John will comment on this later during the call. Revenues for the quarter were $190.3 million with corresponding pro forma earnings of $0.99 per diluted share. Although revenues were slightly below the low-end of our guidance, earnings came in strong and are above guidance and consensus.

The first quarter earnings were positively impacted by a favorable product mix leading to a 45.1% pro forma gross profit margin. As a result, our pro forma EBITDA percent for the quarter was 21.3% which is approximately the mid-point of our long-term goal of 19% to 23%. In addition, the tax rate is below guidance which is primarily the result of the permanent reinstatement of the federal R&D tax credit. Net sales for the first quarter of $190.3 million decreased $19.3 million or 9% sequentially. In general, this decline can be attributed to our historically shorter first fiscal quarter coupled with the impact of the timing of shipping larger Linebeam systems for the flat panel display market and an overall via drilling market downturn. In addition, the economic slowdown in China impacted our materials processing and medical markets revenue.

Revenues decreased $10.3 million or 5% compared to the same quarter a year ago. And as a reminder, the first quarter of fiscal 2015 included our largest format Linebeam system. Our total backlog of $403 million is also a record for the Company. The shippable backlog at the end