Advanced Energy Industries Inc. (AEIS, Financial) filed Quarterly Report for the period ended 2010-09-30.
Advanced Energy Industries Inc. has a market cap of $564.6 million; its shares were traded at around $13.2 with a P/E ratio of 50.1 and P/S ratio of 3.1. AEIS is in the portfolios of RS Investment Management, Chuck Royce of Royce& Associates, Steven Cohen of SAC Capital Advisors.
Sales for the three months ended September 30, 2010 increased 224.4% to $141.0 million from $43.5 million for the three months ended September 30, 2009. Sales for the nine months ended September 30, 2010 increased 199.5% to $310.8 million from $103.8 million for the nine months ended September 30, 2009. The increase in sales for the period was driven primarily by a recovery in all of the end markets that we serve, most notably in the semiconductor capital equipment market and the addition of $31.5 million generated by PV Powered during the period May 3, 2010 to September 30, 2010. This recovery began to occur in the second half of 2009 and continued into the first nine months of 2010.
Sales to customers in the solar panel market increased in terms of dollars to $18.9 million, or 13.4% of total sales, for the three months ended September 30, 2010 as compared to $2.3 million, or 5.4% of total sales, for the three months ended September 30, 2009. Sales to customers in the solar panel market increased in terms of dollars to $35.6 million, or 11.5% of total sales, for the nine months ended September 30, 2010 as compared to $13.9 million, or 14.5% of total sales, for the nine months ended September 30, 2009.
Global support revenue grew 28.9% to $13.2 million, or 9.3% of total sales, for the three months ended September 30, 2010, compared to $10.2 million, representing 23.5% of sales, for the three months ended September 30, 2009. In the nine months ended September 30, 2010, global support sales rose 33.3% to $34.7 million, or 11.2% of sales, from $26.0 million, or 25.1% of sales in the nine months ended September 30, 2009. The increase in global support sales was due to an increase in factory utilization by our customers, which drove demand for repairs, replacement parts and inventory restocking. The outlook for our service business in the last quarter of 2010 continues to be strong, and we expect it will grow as we expand our product offerings to include maintenance contracts in the growing solar array market.
The increase in research and development expenses of $7.2 million in the three months ended September 30, 2010 as compared to the same period in 2009 was driven primarily by increases in personnel costs of $2.1 million, materials and supplies of $1.4 million and outside consulting services of $1.4 million. The increase of $10.9 million in the nine months ended September 30, 2010 as compared to the same period in 2009 was driven primarily by increases in personnel costs of $5.0 million and outside consulting services of $3.0 million. The increase in personnel costs were driven by the reversal of the temporary cost control efforts mentioned above as well as engineering personnel absorbed in the PV Powered acquisition. We continue to focus on new product development, specifically related to the expansion of our inverter product line globally and, although we have maintained a very cautious approach to our discretionary spending in 2010, we anticipate that research and development expenses will continue to increase in the last quarter of 2010 in terms of absolute dollars but remain within their current range as a percentage of sales.
The increase in SG&A expenses of $10.7 million in the three months ended September 30, 2010 as compared to the same period in 2009 was driven primarily by increases in personnel costs of $6.8 million, including $5.0 million of incentive compensation, $1.5 million of outside consultant fees, $0.5 million of travel costs and $0.4 million of external sales commission. The increase of $22.2 million in the nine months ended September 30, 2010 as compared to the same period in 2009 was driven primarily by increases in personnel costs of $13.4 million, including $8.7 million of incentive compensation, $2.9 million of outside consultant fees, $1.4 million of travel costs and $0.6 million of external sales commissions. The increase in commissions was driven by our sharp increase in revenue. Our travel increases were necessary to meet the expectations and demands of our global customers. The increased personnel costs related to the reversal of the temporary cost control efforts described earlier in this section as well as the incentive compensation for which there was no comparable amount in 2009.We also incurred $0.8 million of transaction costs related to the acquisition of PV Powered during the nine months ended September 30, 2010 as well as additional costs related to employees absorbed through the acquisition. Although we are aware of the growing needs of our customers during this period of revenue growth and will continue to closely scrutinize and monitor increases to these expenses throughout the year, we do anticipate that SG&A expenses will continue to increase in the last quarter of 2010 in terms of absolute dollars and will remain within their current range as a percentage of sales.
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Advanced Energy Industries Inc. has a market cap of $564.6 million; its shares were traded at around $13.2 with a P/E ratio of 50.1 and P/S ratio of 3.1. AEIS is in the portfolios of RS Investment Management, Chuck Royce of Royce& Associates, Steven Cohen of SAC Capital Advisors.
Highlight of Business Operations:
We had income from continuing operations for the three months ended September 30, 2010 of $17.6 million compared to an $8.4 million net loss from continuing operations for the three months ended September 30, 2009. We had income from continuing operations for the nine months ended September 30, 2010 of $33.9 million compared to a $103.5 million loss from continuing operations for the nine months ended September 30, 2009. The loss from continuing operations for the nine months ended September 30, 2009 included a $63.3 million non-cash impairment of goodwill and $4.4 million of restructuring charges.Sales for the three months ended September 30, 2010 increased 224.4% to $141.0 million from $43.5 million for the three months ended September 30, 2009. Sales for the nine months ended September 30, 2010 increased 199.5% to $310.8 million from $103.8 million for the nine months ended September 30, 2009. The increase in sales for the period was driven primarily by a recovery in all of the end markets that we serve, most notably in the semiconductor capital equipment market and the addition of $31.5 million generated by PV Powered during the period May 3, 2010 to September 30, 2010. This recovery began to occur in the second half of 2009 and continued into the first nine months of 2010.
Sales to customers in the solar panel market increased in terms of dollars to $18.9 million, or 13.4% of total sales, for the three months ended September 30, 2010 as compared to $2.3 million, or 5.4% of total sales, for the three months ended September 30, 2009. Sales to customers in the solar panel market increased in terms of dollars to $35.6 million, or 11.5% of total sales, for the nine months ended September 30, 2010 as compared to $13.9 million, or 14.5% of total sales, for the nine months ended September 30, 2009.
Global support revenue grew 28.9% to $13.2 million, or 9.3% of total sales, for the three months ended September 30, 2010, compared to $10.2 million, representing 23.5% of sales, for the three months ended September 30, 2009. In the nine months ended September 30, 2010, global support sales rose 33.3% to $34.7 million, or 11.2% of sales, from $26.0 million, or 25.1% of sales in the nine months ended September 30, 2009. The increase in global support sales was due to an increase in factory utilization by our customers, which drove demand for repairs, replacement parts and inventory restocking. The outlook for our service business in the last quarter of 2010 continues to be strong, and we expect it will grow as we expand our product offerings to include maintenance contracts in the growing solar array market.
The increase in research and development expenses of $7.2 million in the three months ended September 30, 2010 as compared to the same period in 2009 was driven primarily by increases in personnel costs of $2.1 million, materials and supplies of $1.4 million and outside consulting services of $1.4 million. The increase of $10.9 million in the nine months ended September 30, 2010 as compared to the same period in 2009 was driven primarily by increases in personnel costs of $5.0 million and outside consulting services of $3.0 million. The increase in personnel costs were driven by the reversal of the temporary cost control efforts mentioned above as well as engineering personnel absorbed in the PV Powered acquisition. We continue to focus on new product development, specifically related to the expansion of our inverter product line globally and, although we have maintained a very cautious approach to our discretionary spending in 2010, we anticipate that research and development expenses will continue to increase in the last quarter of 2010 in terms of absolute dollars but remain within their current range as a percentage of sales.
The increase in SG&A expenses of $10.7 million in the three months ended September 30, 2010 as compared to the same period in 2009 was driven primarily by increases in personnel costs of $6.8 million, including $5.0 million of incentive compensation, $1.5 million of outside consultant fees, $0.5 million of travel costs and $0.4 million of external sales commission. The increase of $22.2 million in the nine months ended September 30, 2010 as compared to the same period in 2009 was driven primarily by increases in personnel costs of $13.4 million, including $8.7 million of incentive compensation, $2.9 million of outside consultant fees, $1.4 million of travel costs and $0.6 million of external sales commissions. The increase in commissions was driven by our sharp increase in revenue. Our travel increases were necessary to meet the expectations and demands of our global customers. The increased personnel costs related to the reversal of the temporary cost control efforts described earlier in this section as well as the incentive compensation for which there was no comparable amount in 2009.We also incurred $0.8 million of transaction costs related to the acquisition of PV Powered during the nine months ended September 30, 2010 as well as additional costs related to employees absorbed through the acquisition. Although we are aware of the growing needs of our customers during this period of revenue growth and will continue to closely scrutinize and monitor increases to these expenses throughout the year, we do anticipate that SG&A expenses will continue to increase in the last quarter of 2010 in terms of absolute dollars and will remain within their current range as a percentage of sales.
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