Proto Labs, Inc. (NYSE:PRLB) Q1 2018 Earnings Conference Call - Final Transcript

Apr 26, 2018 • 08:30 am ET

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Proto Labs, Inc. (NYSE:PRLB) Q1 2018 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

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

It is now my pleasure to introduce your host, Mr. Dan Schumacher, Director of Investor Relations. Thank you. You may begin.

Executive
Dan Schumacher

Thank you, operator, and good morning, everyone. With me today is Vicki Holt, our President and Chief Executive Officer; and John Way, our Chief Financial Officer. This morning before the market opened, Proto Labs issued a press release announcing its financial results for the first quarter ended March 31, 2018. The release is available on the company's website at protolabs.com.

Before we begin, I would like to remind everyone that our discussion will include statements relating to future performance and expectations that are or may be considered forward-looking statements and subject to many risks and uncertainties that could cause actual results to differ materially from expectations. Please refer to our earnings press release and recent SEC filings, including our Annual Report on Form 10-K, for information on certain risks that could cause the actual outcomes to differ materially and adversely from any forward-looking statements made today.

Additionally, the results and guidance we will discuss include non-GAAP financial measures consistent with our past practice. Please refer to our press release within the Investor Relations section of our company website for a complete reconciliation of non-GAAP to GAAP results.

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

Executive
Victoria M. Holt

Thank you, Dan. Good morning, everyone. Thank you for joining us on our first quarter conference call. Proto Labs began 2018 with a strong start, as reflected in the press release that we issued today. We reported record quarterly revenue and record net income in the first quarter. Both our revenue and our earnings per share were just above our guidance range. This quarter is the first full quarter that includes the results of the Rapid Manufacturing acquisition that we completed at the end of 2017. The results of this acquisition combined with our strong business performance and the benefits of the tax law changes are reflected in our financial results.

We reported revenue of $108 million in the first quarter. This represented an increase of 34% over the prior year. In addition to our revenue growth, we continue to serve a record number of product developers. Our unique product developers served increased 22% to 18,057 compared to the prior year. The number of unique product developers does not yet include the individuals served on the Rapid Manufacturing system.

Looking at a breakdown by geography, the US, our largest market, produced record revenue and strong growth of 40% over the prior year, including the benefit from the Rapid acquisition. Europe increased 17% with growth rates benefiting from foreign currency translation. On a constant currency basis, revenue growth was 2%. This growth rate