FARO Reports 2010 Sales Growth of 29.9%; 2010 Orders Growth of 30.5%; Net Income of $11.1 million

LAKE MARY, Fla., Feb. 23, 2011 /PRNewswire/ -- FARO Technologies, Inc. (Nasdaq: FARO) today announced results for the fourth quarter ended December 31, 2010.  Sales in the fourth quarter of 2010 increased 27.1%, to $58.5 million, from $46.0 million in the fourth quarter of 2009.  The Company reported net income of $4.8 million, or $0.29 per share, compared to a net loss of $0.04 per share in the fourth quarter of 2009.

Fiscal 2010 sales were $191.8 million, an increase of 29.9%, compared to fiscal 2009 sales of $147.7 million.  New order bookings for fiscal 2010 were $197.9 million, an increase of 30.5%, from $151.7 million in fiscal 2009.  Net income for fiscal 2010 was $11.1 million compared to net loss of $10.6 million in fiscal 2009.

New order bookings for the fourth quarter of 2010 were $67.4 million, an increase of $14.3 million, or 26.9%, compared to $53.1 million in the fourth quarter of 2009.

"The fourth quarter was extremely strong for us, a significant accomplishment compared to the fourth quarter of 2009 when sales started to improve," stated Jay Freeland, FARO's President and CEO.  "Asia continued its rapid expansion, growing sales 43% in the fourth quarter and more than 50% for the year.  We finished 2010 with approximately $23 million in backlog, our highest level ever, providing a solid foundation for the first quarter of 2011.  Finally, the launch of the new Focus 3D Laser Scanner exceeded our expectations.  Orders for the Focus in the fourth quarter of 2010 were substantially higher than any total year for the previous laser scanner models.  We believe this reflects the disruptive nature of this product, with its cutting edge performance and market-leading size, weight, ease of use and price."

Gross margin for the fourth quarter of 2010 was 59.0%, compared to 55.4% in the fourth quarter of 2009. Gross margin increased primarily due to an increase in the proportion of higher margin product sales relative to lower margin service revenue.

"Overall, 2010 was an outstanding year.  We had excellent sales growth and ground-breaking product introductions.  We capitalized on the cost leverage we created in 2009 which added substantially to the bottom line and also allowed for the introduction of both the FARO Focus 3D and the FARO AMP.  The Company is positioned well for 2011, with equally exciting product introductions lined-up and additional capacity to leverage our structure.  We did not issue any guidance in 2009 and 2010 and we will not be issuing specific guidance for 2011.  However, we maintain the view that our markets remain highly underpenetrated and we believe we have the ongoing opportunity to achieve the annual 20-25% sales growth rates we historically achieved. Our top priority continues to be strengthening our position as the leader in this space," Freeland concluded.

This press release contains forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that are subject to risks and uncertainties, such as statements about FARO's focus, plans and strategies, and its future operating results and financial condition. Statements that are not historical facts or that describe the Company's plans, objectives, projections, expectations, assumptions, strategies, or goals are forward-looking statements. In addition, words such as "intend," "believe," "will," "expect" and similar expressions or discussions of our strategy or other intentions identify forward-looking statements. Forward-looking statements are not guarantees of future performance and are subject to various known and unknown risks, uncertainties, and other factors that may cause actual results, performances, or achievements to differ materially from future results, performances, or achievements expressed or implied by such forward-looking statements. Consequently, undue reliance should not be placed on these forward-looking statements.

Factors that could cause actual results to differ materially from what is expressed or forecasted in such forward-looking statements include, but are not limited to:

• development by others of new or improved products, processes or technologies that make the Company's products obsolete or less competitive;
• the cyclical nature of the industries of the Company's customers and material adverse changes in customers' access to liquidity and capital;
• declines or other adverse changes, or lack of improvement, in industries that the Company serves or the domestic and international economies in the regions of the world where the Company operates and other general economic, business, and financing conditions;
• fluctuations in the Company's annual and quarterly operating results and the inability to achieve its financial operating targets;
• risks associated with expanding international operations, such as fluctuations in currency exchange rates, difficulties in staffing and managing foreign operations, political and economic instability, compliance with import and export regulations, and the burdens and potential exposure of complying with a wide variety of U.S. and foreign laws and labor practices;
• other risks detailed in Part I, Item 1A. Risk Factors in the Company's Annual Report on Form 10-K for the year ended December 31, 2009.

Forward-looking statements in this release represent the Company's judgment as of the date of this release. The Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.

About FARO

With over 20,000 installations and 11,000 customers globally, FARO Technologies, Inc. designs, develops, and markets portable, computerized measurement and imaging devices and software used to create digital models -- or to perform evaluations against an existing model -- for anything requiring highly detailed 3-D measurements, including part and assembly inspection, factory planning and asset documentation, as well as specialized applications ranging from surveying, recreating accident sites and crime scenes to digitally preserving historical sites.

FARO's technology increases productivity by dramatically reducing the amount of on-site measuring time, and the various industry-specific software packages enable users to process and present their results quickly and more effectively.

Principal products include the world's best-selling portable measurement arm -- the FaroArm; the world's best-selling laser tracker -- the FARO Laser Tracker X and Xi; the FARO Laser ScanArm; FARO Photon Laser Scanners; the FARO Gage, Gage-PLUS and PowerGAGE; and the CAM2 Q family of advanced CAD-based measurement and reporting software. FARO Technologies is ISO-9001 certified and ISO-17025 laboratory registered.

SOURCE FARO Technologies, Inc.