01—Abstract
Summary
Summary of the 10-K filed August 27, 2010. Cited figures are marked; the original filing is the authoritative source.
II-VI Incorporated's 2010 Form 10-K report highlights a strong recovery and growth trajectory following the global economic downturn.
The company experienced a significant increase in bookings and revenues, driven by improved demand across its key markets, including industrial, military, and telecommunications. The acquisition of Photop Technologies, Inc. in January 2010 played a crucial role in this growth, contributing positively to both top-line and bottom-line results and expanding the company's capabilities in crystal materials and optics. The company's strategy emphasizes vertical integration, investment in manufacturing, customer service, and strategic acquisitions.
II-VI Incorporated operates globally with manufacturing facilities and sales offices in key regions, and a substantial portion of its revenue is derived from international sales. Despite facing challenges such as economic uncertainties and competition, the company appears well-positioned to capitalize on market trends and continue its expansion in fiscal year 2011.
02—Key points
Key Highlights
- Significant increase in bookings and revenues in fiscal year 2010, indicating a recovery from the previous year and growing market demand.
- Successful acquisition of Photop Technologies, Inc. in January 2010, which contributed positively to financial results and expanded the company's product portfolio and market reach.
- Strengthening demand in key segments like Infrared Optics and Military & Materials, driven by increased industrial activity and military program involvement.
- Diversified business segments including Infrared Optics, Near-Infrared Optics, Military & Materials, and Compound Semiconductor Group, providing resilience and broad market coverage.
- Global operational footprint with manufacturing and sales operations in North America, Europe, and Asia, supporting international revenue growth (49% of total revenue in FY2010).
- Company's strategic focus on vertical integration, investment in manufacturing, and pursuing strategic acquisitions to enhance competitive position and drive growth.
- A substantial backlog of $157 million as of June 30, 2010, providing visibility into future revenue streams.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2010, Coherent Corp. kept $0.11.
- Revenue$345.1M100.0%
- Cost of revenue−$210.5M61.0%
- Gross profit$134.6M39.0%
- Operating costs−$96.0M27.8%
- Operating income$38.6M11.2%
- Interest, other & tax$-00.0%
- Net income$38.6M11.2%
Where FY2010 revenue went
$345.1M- Cost of revenue: $210.5M, 61% of revenue
- SG&A: $71.1M, 21% of revenue
- Net income: $38.6M, 11% of revenue
- R&D: $11.8M, 3.4% of revenue
- Other operating costs: $13.1M, 3.8% of revenue
Kept 11% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2010filed August 27, 2010Financial Statements
FY2010 against FY2009
| Line item | FY2010FY2009 | Change |
|---|---|---|
| Revenue | $345.09M$292.22M | +18.1% |
| Cost of Revenue | $210.49M$168.62M | +24.8% |
| Gross Profit | $134.60M$123.61M | +8.9% |
| R&D Expenses | $11.81M$10.21M | +15.7% |
| SG&A Expenses | $71.11M$58.07M | +22.5% |
| Operating Expenses | $293.77M$245.90M | +19.5% |
| Operating Income | $38.58M$38.86M | −0.7% |
| Interest Expense | $87K$178K | −51.1% |
| Net Income | $38.58M$36.78M | +4.9% |
| EPS (Basic) | $0.64$0.62 | +3.2% |
| EPS (Diluted) | $0.63$0.61 | +3.3% |
| Shares Outstanding (Basic) | 60.30M59K | +101534.8% |
| Shares Outstanding (Diluted) | 61.50M60K | +102127.2% |
05—Questions
Frequently Asked Questions
What was the financial performance of II-VI Incorporated in fiscal year 2010?
In fiscal year 2010, II-VI Incorporated demonstrated strong financial recovery. Bookings increased by 48% to $387.6 million, and revenues grew by 18% to $345.1 million, compared to fiscal year 2009. Net earnings attributable to II-VI Incorporated rose by 5% to $38.6 million, translating to diluted earnings per share of $1.25. This improvement was driven by increased demand across various markets and the significant contribution from the acquisition of Photop Technologies.
How did the acquisition of Photop Technologies, Inc. impact the company?
The acquisition of Photop Technologies, Inc. in January 2010 was a key driver of II-VI's growth in fiscal year 2010. Photop contributed approximately $46.9 million in revenues and $30.4 million in goodwill to the company's financials. The acquisition expanded II-VI's capabilities in crystal materials and optics, particularly within the Near-Infrared Optics segment, and is expected to yield further synergies and financial benefits.
What are the main risks and challenges facing II-VI Incorporated, according to the filing?
The company faces several risks, including the impact of general economic conditions on demand for its products, reliance on international sales and global operations which are subject to currency fluctuations and geopolitical risks, competition from larger companies, dependence on complex manufacturing processes and limited supply sources for certain materials, potential volatility in commodity prices, and risks associated with strategic acquisitions. Exposure to government markets, where contracts can be subject to funding changes, is also a noted risk.
What is the company's strategy for future growth?
II-VI Incorporated's strategy focuses on building businesses with world-class, high-technology materials capabilities. Key strategies include vertical integration, continued investment in manufacturing operations, enhancing its reputation for quality and customer service, identifying new products and markets, strategically utilizing Asian manufacturing operations, pursuing strategic acquisitions and alliances, actively engaging in military programs, and maintaining a balanced approach to research and development. The company aims to capitalize on market growth and operational excellence.
06—Continue