Planar Systems, Inc. (PLNR)
F1Q12 Earnings Call
February 7, 2012 5:00 PM ET
Gerry Perkel – President and CEO
Scott Hildebrandt – Chief Financial Officer
Jeff Martin – Roth Capital Partners
Jim Ricchiuti – Needham & Co.
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As a reminder, this conference is being recorded for replay purposes. I would now like to turn the conference over to your host for today, Mr. Gerry Perkel, President and CEO. Please proceed, sir.
Good afternoon. And thank you for joining us for Planar's first quarter earnings conference call. With me this afternoon is Scott Hildebrandt, Planar's Chief Financial Officer.
Before I begin, I do need to say that the press release -- press releases we issued today contain 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 other -- 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 earnings 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 say that I’m pleased with the 14% revenue growth we delivered in the first quarter and the progress we are making in growing our digital signage revenue base. Specifically on the digital signage products front, I’m very pleased that we were able to deliver 85% growth in revenues for these products compared with the first quarter of last year, as digital signage product revenues totaled $10.9 million.
As you know, for sometime, we’ve been focusing on driving digital signage growth and have set a target to achieve 30% or greater digital signage product revenue growth for this fiscal year. Quarterly growth rates will swing from quarter-to-quarter and obviously 85% was a very strong result.
The key driver of our growth was again, impressive results for our Clarity Matrix product line, where we saw growth of approximately 140%. We continue to experienced strong growth in the adoption of super narrow bezel technology and continue to find many customers across multiple markets they are seeing the value of our unique architecture.
In addition, we are seeing more and more of our digital signage product sales come from our standard products versus custom designs as we expand our standard product offerings. We began shipping additional models in our new PS line of large format standalone signage displays this quarter and expect to expand our standalone product offerings as we move forward.
We also continue to seek out opportunities for our outdoor LCD products for signage applications and now have products installed in some trials for outdoor deployments. While the adoption in outdoor LCD signage has been slower than we had hoped. We still see a good longer term opportunity as more customers such as quick-serve restaurants look to convert portions of their outdoor static signage to digital. All in all we are pleased with the progress we are making in our [quest] to aggressively grow our digital signage products.
As we move forward, you will hear us describe the rest of our product lines broadly as our commercial and industrial products. This product grouping represents approximately three quarters of our revenue today, has made up of several product lines, some of which are more mature and some of which offer growth opportunities.
In the first quarter, our commercial and industrial product lines in total delivered 3% and total $36.8 million, most of the product lines within this category group, for instance, compared to the first quarter a year ago our rear-projection cube revenues grew approximately 17%, our desktop monitor revenues grew approximately 16%, our touch monitor revenues grew approximately 10% and our custom developed industrial products grew approximately 28%, and our Runco high-end home theater products grew about 2%.
Unfortunately, those positive results were offset by a 25% decline in our EL product sales along with the reductions in some small product lines that we are in the process of discontinuing.
Our goal with this commercial and industrial product line is to capitalize on growth opportunities we see and to limit our investment level there, so we can fund the growth of the digital signage opportunities we see.
As we look forward, we do see growth opportunities for several of these product lines, but in total we expect to see single-digit growth in this area for FY ’12 as the more mature areas may tend to offset growth in other areas.
We’ve captured a number of new design wins recently for our custom AMLCD business for ruggedized military applications. We expect this to begin production in the second half of FY ’12 and in FY ’13, and these new customers as they move into production do offer opportunities for growth.