Planar Systems, Inc. (PLNR)
F1Q13 Earnings Call
February 6, 2013 5:00 PM ET
Gerry Perkel – President and CEO
Ryan Gray – VP and CFO
Bill Gordon – Gordon Capital
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I would now like to turn the conference over to your host for today, Mr. Gerry Perkel, President and CEO. I move the floor sir.
Good afternoon and thank you for joining us for Planar’s first quarter earnings conference call. With me this afternoon is Ryan Gray, Planar’s Chief Financial Officer.
Before I begin I do need to state that the press release we issued today contains forward-looking statements. On this conference call we will comment on our strategic business and financial outlook and make other forward-looking statements based on our current expectations, estimates, assumptions and projections. Words such as expects, anticipates, intends, plans, believes, sees, estimates and variations of such words and similar expressions are intended to identify such forward-looking statements.
All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. I refer you to the earning’s press release we issued earlier today and to our periodic filings with the SEC for a description of factors that could cause actual results to differ materially from the results described in the forward-looking statements. The forward-looking statements we make today speak only as of today and we do not undertake any obligation to update any such statements to reflect events or circumstances occurring after today.
With that behind us, let me move on and talk about our results for the quarter. We are very pleased with the results from Q1. We made good progress and continuing to transform our revenue mix towards product categories with higher growth potential. Our total revenue of $44.2 million was slightly above our expectations. We delivered the highest level of quarterly Digital Signage Product revenues ever at $16.9 million which represents 55% growth over Q1 last year.
We experienced that growth across multiple of our Digital Signage Product families. In particular our tiled LCD solutions grew over 45% and reached to a record quarterly level of over $13 million. Additionally, our Signage Monitor Products were more than double were they were a year ago. All in all it was a very strong quarter for us in Digital Signage Products.
Highlighting the quarter among our Commercial and Industrial product line is our Touch Monitor product line. Sales for the quarter of Touch Monitor were $4.9 million which represents 38% growth over the same period a year ago. We began shipping our new Helium Touch Monitor which is a 27-inch multi-touch display designed specifically for use with the new Windows 8 operating system during the quarter which helped contribute to the growth figures.
In total, our Commercial and Industrial product line sales were $27.3 million, just down 26% from the first quarter a year ago. Some of that decline is linked to our EL product line which as we announced was sold during the quarter and as a result was only part of the company for a portion of the quarter. When excluding our EL product line revenue, the remainder of the Commercial and Industrial product lines declined approximately 20%.
The strong growth in Touch Monitors I mentioned a moment ago was offset by declines in our desktop monitors, high-end home custom and rear-projection products. As we have discussed previously, we are focused on driving more and more of our revenue in our product category that represent higher growth potential. Digital Signage Products and Touch Monitors represent two such market opportunities and in Q1 their combined revenues represented just over 50% of our total revenue when excluding EL product revenue.
That is the highest percentage of contribution from our growth revenue categories that we’ve achieved so far and is far above the 34% level we saw a year ago in the first quarter. As these product categories become a larger portion of our overall business, we expect that the growth of these product lines will enable us to grow in total of the company which is the key part of our strategy.
We’re also pleased with the bottom line results for the quarter as well. We delivered $0.05 of non-GAAP earnings per share which was above our expected results. We have been continuing to work to drive down our breakeven point by reducing expense overtime and improving our gross margins through a stronger mix including higher sales of Digital Signage Products and better absorption of our non-EL manufacturing expenses.
We believe there is more potential to improve here as we continue to increase the total revenue for the company. We also made significant progress on a key customer win for our custom Commercial and Industrial product line. We now have a signed control and purchase orders for a new custom industrial product that will move into production in the second half of this fiscal year. The contract has revenue totaling approximately $10 million over two years and has some potential to increase from that level.
All in all, it was a good quarter from a revenue generation, growth in our new key product lines and profit generation point of view.