FARO has announced its financial results for the fourth quarter and fiscal year ended December 31, 2017.
- Quarterly sales of $106.4 million, up 16.1% year-over-year
- Construction BIM-CIM segment quarterly sales of $25.8 million, up 47.2% year-over-year
- Strengthened gross margin to 58.3% for the quarter
- Increased operating margin to 8.6% for the quarter
Total 2017 sales increased by $35.3 million, or 10.9%, to $360.9 million for the year ended December 31, 2017 from $325.6 million for the year ended December 31, 2016. Sales increase was primarily driven by a strong increase in construction BIM-CIM segment, growth in warranty revenue, and increases in average selling prices. New order bookings increased by $46.3 million, or 14.0%, to $377.0 million for the year ended December 31, 2017 from $330.7 million for the year ended December 31, 2016.
“In 2017, we executed well on our strategic initiatives in completing our vertical reorganization by mid-year, reinvigorating our product portfolio with next generation technology, and investing in expanding our sales force to make meaningful progress towards our long-term financial objectives,” stated Dr. Simon Raab, President and Chief Executive Officer. “Our team delivered double-digit new order bookings and sales growth for 2017, and at the same time increased gross margin progressively through the year to reach 58.3% in the fourth quarter. Our second half performance strongly indicates that we are gaining traction from our vertical focus, investments in new products, and additional sales headcount as highlighted by our remarkable 47.2% increase in fourth quarter construction BIM-CIM sales. As we have discussed before, there is a natural, short-term cost to these investments. However, we expect sustained returns from these initiatives and we will continue with our vertical strategies while optimizing our operations through our 2018 global lean initiatives, which are aimed at reinvigorating the FARO culture of continuous improvement and technological superiority in all of our vertical markets.”
Gross margin was 56.7% for fiscal year 2017, up 2.0 percentage points over the prior year, mostly due to higher average selling prices from stated technological leadership and improved manufacturing efficiency.
Operating income was $5.3 million for fiscal year 2017, reflecting a decrease from $13.3 million for fiscal year 2016. This decrease was primarily due to an intentional increase in operating expenses related to strategic growth initiatives, including a start-up selling expense of $9.5 million driven by a 17.7% increase in period ending sales headcount from 536 as of December 31, 2016 to 631 as of December 31, 2017 and increases in R&D spending from recent technology acquisitions.
As of December 31, 2017, cash and short-term investments totaled $152.0 million, of which $98.8 million was held by foreign subsidiaries.
For more information: www.faro.com