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Mar 31, 2020
FARO Q1 2020 Earnings Report
FARO's financial performance declined due to market softness and COVID-19 impacts, but restructuring efforts progressed as planned.
Key Takeaways
FARO Technologies reported a decrease in total sales and new order bookings for Q1 2020 compared to Q1 2019. The company experienced a net loss, but restructuring plans are on track to achieve targeted savings.
Total sales decreased to $79.5 million from $93.6 million year-over-year due to market softness and COVID-19 uncertainty.
New order bookings declined by 23% to $77.9 million compared to $100.7 million in the prior year.
A net loss of $14.8 million, or $0.84 per share, was recorded, compared to a net income of $0.2 million, or $0.01 per share, in Q1 2019.
Restructuring plan implementation is progressing well, targeting $40 million in annualized savings by year-end.
FARO
FARO
FARO Revenue by Segment
Revenue by Segment
Product Sales Revenue
CapyFin.comService Sales Revenue
CapyFin.com Forward Guidance
FARO is optimistic that its new strategy will enable it to emerge as a stronger, more efficient business with a highly scalable financial model when the business environment returns to normalized levels.
Positive Outlook
- Restructuring plan progressing well, on track to achieve targeted $40 million in annualized savings by the end of the year.
- Strong balance sheet positions FARO well for the current environment.
- Limited disruption to manufacturing supply chain to date.
- Sales team remains enthusiastic about the new go-to-market strategy.
- New strategy expected to enable FARO to emerge as a stronger, more efficient business with a highly scalable financial model.
Challenges Ahead
- Near-term demand visibility remains challenged due to the global pandemic.
- Total sales decreased due to market softness and order pushouts.
- New order bookings decreased compared to the previous year.
- The company recorded additional non-recurring charges related to expected cash severance payments.
- Net loss was recorded for the quarter, compared to net income in the same period last year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income