EFI reports revenue surge in strong Q3 results

Simon Nias
Friday, October 22, 2010

EFI has posted an almost 30% year-on-year increase in third quarter revenues following strong growth across all three of its business segments.

The highlight from EFI's inkjet division, which grew 18% year-on-year, came in UV ink sales, with volumes up 43% year-on-year driven by "terrific demand" for the Vutek GS series, which passed the 100th unit sold mark in the quarter.

In addition to the massive year-on-year increase, year-to-date growth in UV ink sales accelerated from 35% for the first six months to 41% for the nine months to 30 September.

EFI chief executive Guy Gecht described the growth as "back to pre-recession levels" . "Nothing grows that fast except for maybe only one thing - the iPhone," he added.

Gecht said the surge in UV ink sales was "good news on many levels" as it was not only a boost for EFI but an indicator of the health of the US-based company's clients.

"We are delighted to see our customers buying more ink of course, and it's great news for them because it shows they are winning more jobs not only against screen but against other inks, such as aqueous, and against other non-EFI users," he added.

"The GS is leading that consumption because the marketers in the signage and packaging markets love the quality, which is much higher than anything else in the market, the short run capability and the ROI.

"Our figures show that the average ink consumption per GS customer is three times higher than the previous generation, which shows that people are taking advantage of the increased quality and productivity to win more jobs."

Meanwhile, EFI's Fiery division posted revenues of $61m, up 36% on $45m last year, marking the second consecutive quarter of 30% or better year-on-year growth.

EFI highlighted Fiery's strong showing at Graph Expo, where 33 Fierys were on display, including three on its stand and 30 across its OEM partners' booths on the show floor. Xerox, Konica Minolta, Ricoh and Canon will all begin shipping new Fiery-driven engines in the coming quarter.

Gecht said that the performance at Graph Expo had been matched by both Label Expo and SGIA, where EFI broke its record for the number of inkjet printers sold at a trade show and also demonstrated a new textile printer, which gained positive feedback.

"SGIA was outstanding, we overachieved on every metric we set," said Gecht. "EFI is so tied to our customers success and so it's a great morale boost because all our customers are doing well - all three shows this year were way above expectations."

EFI APPS division turnover grew 37% to $15.8m in the quarter, which included revenues from the new Radius ERP for the packaging market. Gecht said: "There is a higher urgency to run businesses very accurately and very efficiently and to do that you need MIS.

"Printers recognise that they can't run a successful business on gut feeling and a spreadsheet anymore."

EFI's group operating income came in at $1.8m for the quarter, up from a $15.1m loss last year, while group pre-tax profit was $4.9m, compared with a $13.9m pre-tax loss in Q3 2009.

For the year-to-date EFI is running an operating loss of $8.4m and a pre-tax loss of $9.4m, compared with an operating loss of $61.6m and a pre-tax profit of $21.1m for the first nine months of 2009 (the latter resulting from the disposal of vacant offices and land at its California headquarters last year).

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