APRIL 18--StockerYale Inc. (Salem, NH; www.stockeryale.com), an independent provider of photonics-based products, announced its financial results for the first quarter, ended March 31, 2005. Revenues for the first quarter of 2005 increased 11% to $4.6 million from those reported in both the first and fourth quarters of 2004. Revenue growth was driven by higher laser and specialty optical fiber shipments. Order bookings increased 12% to $4.8 million in the first quarter 2005 from $4.3 million the previous quarter reflecting a doubling of specialty fiber orders and improved penetration of lasers into OEM accounts.
Gross profit for the quarter increased 32% to $1.6 million from the comparable quarter of 2004. The increase in gross profit resulted from the combination of higher sales and a significant improvement in gross margin. The gross margin as a percentage of sales increased from 30% in the first quarter of 2004 to 36% in the first quarter of 2005 as the result of selling higher margin products and material cost reductions.
The operating loss for the first quarter was $1.5 million versus $1.4 million in the comparable 2004 quarter and down 52% from $2.9 million in the prior quarter, excluding asset impairment charges of $173,000. Operating expenses were down 18% compared to the fourth quarter of 2004, but increased 15% to $3.1 million compared to $2.7 million the first quarter of 2004. The increase primarily reflected higher nonrecurring legal expenses, which the company expects to decline significantly in the near future. Research and development expenses of $833,000 reported in the first quarter of 2005 were consistent with the first quarter of 2004 and selling expenses increased 13% to $784,000 compared to the first quarter of 2004.
In April 2005, the company reached an agreement to sell its 100,000-sq ft Salem, NH, manufacturing facility for $4.75 million subject to completion of due diligence procedures and contingent on the buyer receiving financing. It is expected that the transaction will close within 75 days. As previously disclosed, the company relocated the Salem illumination business to Montreal, Canada, in June 2004
"This year is off to a strong start led by our laser and specialty-fiber businesses. We expect that increased sales to existing OEMs, the introduction of several new products, and improved manufacturing efficiencies will result in a meaningful improvement in gross margins and operating profits throughout the year," said Ricardo A. Diaz, chief operating officer. "We expect both our laser and fiber businesses to drive our top line growth during the year, presuming continued strength in the machine-vision market, as well as increased acceptance of our products in the defense market, including fiberoptic gyroscopes for navigation systems and reference lasers for missile counter-measure systems. In addition, the company is beginning to receive orders for its new line COBRA 500 LED line illuminators, which received Photonic Spectra's prestigious product of the year award this past January," Diaz added.
