AUGUST 10--Coreco Inc. (Montreal, Quebec, Canada; www.imaging.com) has announced its results for the second quarter, ended June 30, 2004, marking its highest quarterly revenues in three years. Revenues in the second quarter increased 27% to US$6,225,731 year over year and 17% on a sequential basis. The gross margin maintained its upward trend, increasing to 61.1% of sales from 58.7% one year ago and 60.7% last quarter. As a result of the increased momentum in revenue growth and the higher operating leverage, net earnings almost doubled to US$552,849 or US$0.08 per share in the second quarter, from US$283,752 or US$0.04 per share in the same period last year.
For the comparable six-month periods, revenues increased 24%, the gross margin improved to 60.9% from 57%, and net earnings more than quadrupled to US$892,406 or US$0.13 per share from US$207,748 or US$0.03 per share one year earlier.
At June 30, 2004, the company held US$3,520,026 in cash and cash equivalents and net working capital improved to US$9.0 million from US$7.9 million at the end of last year.
All the company's major geographic markets generated higher sales during the second quarter. Asia accounted for the largest increase with year-over-year growth of 46%, while sales in the USA and Europe grew by 28% and 13%, respectively. For this quarter, Asia accounted for 30% of total sales, North America for 45% and Europe for 25%.
By product category, sales of the company's smart products continued to grow, increasing almost threefold over the same quarter of last year. Sales of embedded products grew by 38%, frame grabbers by 11% and software by 4%. As a percentage of total sales, frame grabbers, embedded products and software accounted for 43%, 45% and 6%, respectively, and smart products for the remaining 6%.
The semiconductor and electronics industries continued to account for most of the revenue growth in the second quarter, representing a year-over-year increase of 60%. Shipments to flat-panel-display manufacturers drove this growth, resulting from a large order received in the first quarter. During the quarter, the company received 15 design-wins, including seven for semiconductor and electronics applications and two from medical OEMs. While this number is lower than the design-wins received in the first quarter, the total dollar value is higher because of wins from large OEMs.
The book-to-bill ratio remained above 1.0 during the first six months of the year. Subsequent to quarter-end, it increased significantly due to the booking of orders previously deferred by European customers to the beginning of July.
Sales of the company's smart products continued to grow in the quarter, accounting for more than 6% of total sales compared with less than 2% for the same period last year. New customers during the quarter included Fortune 500 companies in the automotive and food processing industries. To serve the growing market for smart products, the company launched Netsight II, a new high-performance, multi-camera vision system. It also enlarged its international distribution network by adding five new distributors in the USA, as well as representation in China, Taiwan, and Singapore.