Rogers Corp. (ROG, Financial) filed Quarterly Report for the period ended 2010-03-31.
Rogers Corp. has a market cap of $546.8 million; its shares were traded at around $34.66 with a P/E ratio of 86.7 and P/S ratio of 1.9. ROG is in the portfolios of Westport Asset Management, Chuck Royce of Royce& Associates.
Our sales growth was driven by the performance of our core strategic businesses, as High Performance Foams achieved sales of $31.8 million, an increase of almost 85% over the $17.2 million recorded in the first quarter of 2009, and our Printed Circuit Materials achieved sales of $34.6 million, an increase of 15.1% over the $30.0 million in sales in the first quarter of 2009. From an operating results perspective, all of our reportable segments reported significant improvements in the first quarter of 2010 as compared to the losses incurred in the first quarter of 2009. Once again, these improvements were led by our High Performance Foams segment, which achieved operating income of $2.3 million as compared to an operating loss in the first quarter of 2009 of $4.7 million, and our Printed Circuit Materials segment, which reported operating income of $4.6 million in the first quarter of 2010 as compared to an operating loss of $0.9 million in the first quarter of 2009.
Selling and administrative expenses increased 25.3% from $16.7 million in the first quarter of 2009 to $21.0 million in the first quarter of 2010. The quarter-over-quarter increase in expense experienced in 2010 as compared to 2009 can be primarily attributable to the incremental costs incurred during 2010 for equity compensation and incentive compensation programs. Equity compensation expense totaled $2.6 million in the first quarter of 2010, an increase of $1.9 million from the first quarter of 2009, which was due primarily to the timing of the issuance of our primary 2010 stock option grants in the first quarter of 2010, as the comparable grant was issued in the second quarter of 2009, and the related accounting treatment that requires us to immediately expense certain grants to those individuals who are eligible for retirement. The increase in incentive compensation expense of approximately $2.2 million was driven by our current projections related to our annual incentive compensation plan. There was no incentive compensation costs incurred in 2009. In addition, selling and administrative expenses includes approximately $0.9 million in costs related to the acquisition of SK Utis in the first quarter of 2010. Excluding the 2010 equity compensation, incentive and acquisition costs, selling and administrative expenses decreased in 2010 as compared to 2009 by 8.8%, primarily due to our lower cost structure, which more than offset the higher costs incurred related to increased production levels.
Our High Performance Foams (HPF) reportable segment is comprised of our polyurethane and silicone foam products. Net sales in this segment were $31.8 million in the first quarter of 2010, an increase of 84.9% from the recession-driven $17.2 million in the first quarter of 2009. Operating results in this segment also improved significantly as the segment swung from an operating loss of $4.7 million in the first quarter of 2009 to an operating profit of $2.3 million in 2010. First quarter 2010 results also included approximately $0.9 million of costs associated with the acquisition of SK Utis. Sales have continued to increase sequentially in this segment from the low point experienced in the first quarter of 2009, as sales in first quarter of 2010 improved upon the fourth quarter 2009 results by 12.0%. The increase in sales has been driven by strong demand for specialty foam materials across almost all end markets, particularly in mobile internet devices. Also, sales into the mass transit market were strong, driven by demand for specialty foam products into seating applications in trains. Sales in this segment have also improved incrementally as a result of the acquisition of the assets of MTI Global in the second quarter of 2009 and will benefit in the future from the acquisition of SK Utis, which occurred in the first quarter of 2010. First quarter results do not include any operational activity of SK Utis, as the company was acquired at the close of business on March 31, 2010.
At March 31, 2010, cash, cash equivalents and short-term investments totaled $42.9 million as compared to $58.1 million at December 31, 2009, a decline of approximately 26%. This decline was due primarily to the cash payment of $26.0 million made for the acquisition of SK Utis during the quarter, which was financed entirely through internal funding as we did not utilize any of our credit facilities. This decline was also partially offset by positive cash flow from operations and $8.1 million of dividends received from our joint ventures.
We have a Multicurrency Revolving Credit Agreement with RBS Citizens, National Association (Bank), a successor in interest to Citizens Bank of Connecticut (Credit Agreement). On November 16, 2009, we entered into Amendment No. 5 (Amendment) to this Credit Agreement. Pursuant to this Amendment, the total facility under the Credit Agreement was reduced from $100 million to $50 million, by eliminating the previously existing $25 million credit facility and reducing the previously existing $75 million credit facility to $50 million. The current $50 million credit facility (Credit Facility) is available for loans or letters of credit. It is a multi-currency facility under which we may borrow in U.S. dollars, Japanese Yen, Euros or any other currency freely convertible into U.S. dollars and traded on a recognized interbank market. Under the terms of the Credit Agreement, we have the right to incur additional indebtedness outside of the Credit Agreement through additional borrowings in an aggregate amount of up to $25 million.
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Rogers Corp. has a market cap of $546.8 million; its shares were traded at around $34.66 with a P/E ratio of 86.7 and P/S ratio of 1.9. ROG is in the portfolios of Westport Asset Management, Chuck Royce of Royce& Associates.
Highlight of Business Operations:
In the first quarter of 2010, we continued to build on the positive momentum experienced in the second half of 2009, as sales continued to rebound, reaching $83.9 million in the quarter as compared to a recession-driven $65.5 million in the first quarter of 2009. Our bottom line results also improved significantly, as we achieved net income of $0.43 per diluted share in the first quarter of 2010 as compared to a net loss of $0.56 per share in the first quarter of 2009.Our sales growth was driven by the performance of our core strategic businesses, as High Performance Foams achieved sales of $31.8 million, an increase of almost 85% over the $17.2 million recorded in the first quarter of 2009, and our Printed Circuit Materials achieved sales of $34.6 million, an increase of 15.1% over the $30.0 million in sales in the first quarter of 2009. From an operating results perspective, all of our reportable segments reported significant improvements in the first quarter of 2010 as compared to the losses incurred in the first quarter of 2009. Once again, these improvements were led by our High Performance Foams segment, which achieved operating income of $2.3 million as compared to an operating loss in the first quarter of 2009 of $4.7 million, and our Printed Circuit Materials segment, which reported operating income of $4.6 million in the first quarter of 2010 as compared to an operating loss of $0.9 million in the first quarter of 2009.
Selling and administrative expenses increased 25.3% from $16.7 million in the first quarter of 2009 to $21.0 million in the first quarter of 2010. The quarter-over-quarter increase in expense experienced in 2010 as compared to 2009 can be primarily attributable to the incremental costs incurred during 2010 for equity compensation and incentive compensation programs. Equity compensation expense totaled $2.6 million in the first quarter of 2010, an increase of $1.9 million from the first quarter of 2009, which was due primarily to the timing of the issuance of our primary 2010 stock option grants in the first quarter of 2010, as the comparable grant was issued in the second quarter of 2009, and the related accounting treatment that requires us to immediately expense certain grants to those individuals who are eligible for retirement. The increase in incentive compensation expense of approximately $2.2 million was driven by our current projections related to our annual incentive compensation plan. There was no incentive compensation costs incurred in 2009. In addition, selling and administrative expenses includes approximately $0.9 million in costs related to the acquisition of SK Utis in the first quarter of 2010. Excluding the 2010 equity compensation, incentive and acquisition costs, selling and administrative expenses decreased in 2010 as compared to 2009 by 8.8%, primarily due to our lower cost structure, which more than offset the higher costs incurred related to increased production levels.
Our High Performance Foams (HPF) reportable segment is comprised of our polyurethane and silicone foam products. Net sales in this segment were $31.8 million in the first quarter of 2010, an increase of 84.9% from the recession-driven $17.2 million in the first quarter of 2009. Operating results in this segment also improved significantly as the segment swung from an operating loss of $4.7 million in the first quarter of 2009 to an operating profit of $2.3 million in 2010. First quarter 2010 results also included approximately $0.9 million of costs associated with the acquisition of SK Utis. Sales have continued to increase sequentially in this segment from the low point experienced in the first quarter of 2009, as sales in first quarter of 2010 improved upon the fourth quarter 2009 results by 12.0%. The increase in sales has been driven by strong demand for specialty foam materials across almost all end markets, particularly in mobile internet devices. Also, sales into the mass transit market were strong, driven by demand for specialty foam products into seating applications in trains. Sales in this segment have also improved incrementally as a result of the acquisition of the assets of MTI Global in the second quarter of 2009 and will benefit in the future from the acquisition of SK Utis, which occurred in the first quarter of 2010. First quarter results do not include any operational activity of SK Utis, as the company was acquired at the close of business on March 31, 2010.
At March 31, 2010, cash, cash equivalents and short-term investments totaled $42.9 million as compared to $58.1 million at December 31, 2009, a decline of approximately 26%. This decline was due primarily to the cash payment of $26.0 million made for the acquisition of SK Utis during the quarter, which was financed entirely through internal funding as we did not utilize any of our credit facilities. This decline was also partially offset by positive cash flow from operations and $8.1 million of dividends received from our joint ventures.
We have a Multicurrency Revolving Credit Agreement with RBS Citizens, National Association (Bank), a successor in interest to Citizens Bank of Connecticut (Credit Agreement). On November 16, 2009, we entered into Amendment No. 5 (Amendment) to this Credit Agreement. Pursuant to this Amendment, the total facility under the Credit Agreement was reduced from $100 million to $50 million, by eliminating the previously existing $25 million credit facility and reducing the previously existing $75 million credit facility to $50 million. The current $50 million credit facility (Credit Facility) is available for loans or letters of credit. It is a multi-currency facility under which we may borrow in U.S. dollars, Japanese Yen, Euros or any other currency freely convertible into U.S. dollars and traded on a recognized interbank market. Under the terms of the Credit Agreement, we have the right to incur additional indebtedness outside of the Credit Agreement through additional borrowings in an aggregate amount of up to $25 million.
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