UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of
report (Date of earliest event reported): October 30, 2017
Cognex Corporation |
(Exact name of registrant as specified in charter) |
Massachusetts |
001-34218 |
04-2713778 |
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
One Vision Drive, Natick, Massachusetts |
01760-2059 |
(Address of principal executive offices) |
(Zip Code) |
Registrant's telephone number, including area code: (508) 650-3000
N/A |
(Former name or former address, if changed since last report.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
|
Emerging growth company |
⃞ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
⃞ |
Item 2.02 Results of Operations and Financial Condition
On October 30, 2017, Cognex Corporation (the “Company”) issued a news release to report its financial results for the quarter ended October 1, 2017. The release is furnished as Exhibit 99.1 hereto. The information in Item 2.02 of this Current Report on Form 8-K, including the Exhibit attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, regardless of any general incorporation language in such filing.
Item 8.01 Other Events
On October 30, 2017, the Company announced that its Board of Directors increased its quarterly cash dividend to$0.09 per share. In addition, the Board approved a two-for-one split of the Company's common stock, payable in the form of a stock dividend. All shareholders of record on November 17, 2017, will receive the quarterly cash dividend on a pre-split basis and one additional share of common stock for each share they own. The quarterly cash dividend and the stock dividend are payable on December 1, 2017.
The NASDAQ Stock Market is expected to begin reporting the adjusted number of shares outstanding and the split- adjusted per-share stock price on December 4, 2017.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit No. |
Description |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
COGNEX CORPORATION |
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|
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Dated: |
October 30, 2017 |
By: /s/ John J. Curran |
John J. Curran |
||
Senior Vice President of Finance |
||
and Chief Financial Officer |
Exhibit 99.1
Cognex Reports Record Results for the Third Quarter of 2017
Machine Vision Company Reports Record Quarterly Revenue, Net Income and Earnings per Share from Continuing Operations
NATICK, Mass.--(BUSINESS WIRE)--October 30, 2017--Cognex Corporation (NASDAQ: CGNX) today announced its financial results for the third quarter of 2017 (ended October 1, 2017). Table 1 below shows selected financial data for Q3-17 compared to Q3-16, Q2-17 and the first nine months of 2017 compared to the first nine months of 2016. A reconciliation of certain financial measures from GAAP to non-GAAP is shown in Exhibit 2 of this news release.
Table 1* |
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(Dollars in thousands, except per share amounts) |
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Revenue |
Net Income |
Net Income from |
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Quarterly Comparisons |
|||||||||
Current quarter: Q3-17 | $259,739 | $102,348 | $1.14 | ||||||
Prior year’s quarter: Q3-16 | $147,952 | $53,675 | $0.61 | ||||||
Change from Q3-16 to Q3-17 | 76% | 91% | 87% | ||||||
Prior quarter: Q2-17 | $172,904 | $56,072 | $0.63 | ||||||
Change from Q2-17 to Q3-17 | 50% | 83% | 81% | ||||||
Year-to-Date Comparisons |
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Nine months ended Oct. 1, 2017 | $567,585 | $204,075 | $2.28 | ||||||
Nine months ended Oct. 2, 2016 | $391,431 | $111,574 | $1.29 | ||||||
Change from first nine months of 2016 to first nine months of 2017 |
45% |
83% |
77% |
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*Table 1 excludes the results of discontinued operations, which relate to the company’s Surface Inspection Systems Division (SISD) that was sold on July 6, 2015.
“What a spectacular quarter!” exclaimed Dr. Robert J. Shillman, Founder and Chairman of Cognex. “Cognex reported record-breaking revenue, net income and earnings per share that far exceeded the prior records set just last quarter. And we were extremely profitable, with operating margin expanding to a record 42% driven by significant high-margin revenue growth. I am proud of Cognoids everywhere for delivering such impressive results."
“Cognex's remarkable performance is due to perseverance,” said Robert J. Willett, Chief Executive Officer of Cognex. "Our ability to capitalize on the widespread adoption of machine vision is the result of many years of hard work by Cognoids around the world. It's gratifying to see our efforts deliver such exceptional results."
Mr. Willett continued, "Our view of the future continues to be positive as more automation processes that include machine vision are needed to perform an increasing array of complex manufacturing tasks. We are investing to take advantage of the substantial potential that we see for our company going forward."
Details of the Quarter
Statement of Operations Highlights - Third Quarter of 2017
Balance Sheet Highlights - October 1, 2017
Financial Outlook - Fourth Quarter of 2017
Non-GAAP Financial Measures
Analyst Conference Call and Simultaneous Webcast
About Cognex Corporation
Cognex Corporation designs, develops, manufactures and markets a wide range of image-based products, all of which use artificial intelligence (AI) techniques that give them the human-like ability to make decisions on what they see. Cognex products include machine vision systems, machine vision sensors and barcode readers that are used in factories and distribution centers around the world where they eliminate production and shipping errors.
Cognex is the world's leader in the machine vision industry, having shipped more than 1.5 million vision-based products, representing over $5 billion in cumulative revenue, since the company's founding in 1981. Headquartered in Natick, Massachusetts, USA, Cognex has offices and distributors located throughout the Americas, Europe and Asia. For details visit Cognex online at www.cognex.com.
Certain statements made in this news release, which do not relate solely to historical matters, are forward-looking statements. These statements can be identified by use of the words “expects,” “anticipates,” “estimates,” “believes,” “projects,” “intends,” “plans,” “will,” “may,” “shall,” “could,” “should,” and similar words and other statements of a similar sense. These forward-looking statements, which include statements regarding business and market trends, future financial performance, customer order rates, the timing for recognition of revenue, expected areas of growth, research and development activities, further stock repurchases, investments, and strategic plans, involve known and unknown risks and uncertainties that could cause actual results to differ materially from those projected. Such risks and uncertainties include: (1) the loss of a large customer; (2) current and future conditions in the global economy; (3) the reliance on revenue from the consumer electronics or automotive industries; (4) the inability to penetrate new markets; (5) the inability to achieve significant international revenue; (6) fluctuations in foreign currency exchange rates and the use of derivative instruments; (7) information security breaches or business system disruptions; (8) the inability to attract and retain skilled employees; (9) the reliance upon key suppliers to manufacture and deliver critical components for our products; (10) the failure to effectively manage product transitions or accurately forecast customer demand; (11) the inability to design and manufacture high-quality products; (12) the technological obsolescence of current products and the inability to develop new products; (13) the failure to properly manage the distribution of products and services; (14) the inability to protect our proprietary technology and intellectual property; (15) our involvement in time-consuming and costly litigation; (16) the impact of competitive pressures; (17) the challenges in integrating and achieving expected results from acquired businesses; (18) potential impairment charges with respect to our investments or for acquired intangible assets or goodwill; (19) exposure to additional tax liabilities; and (20) the other risks detailed in Cognex reports filed with the SEC, including its Form 10-K for the fiscal year ended December 31, 2016. You should not place undue reliance upon any such forward-looking statements, which speak only as of the date made. Cognex disclaims any obligation to update forward-looking statements after the date of such statements.
Exhibit 1 |
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COGNEX CORPORATION
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Three-months Ended | Nine-months Ended | ||||||||||||||||||||||||
October 1, |
July 2, 2017 |
October 2, |
October 1, |
October 2, |
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Revenue | $ | 259,739 | $ | 172,904 | $ | 147,952 | $ | 567,585 | $ | 391,431 | |||||||||||||||
Cost of revenue (1) | 62,360 | 37,471 | 32,749 | 128,056 | 88,930 | ||||||||||||||||||||
Gross margin | 197,379 | 135,433 | 115,203 | 439,529 | 302,501 | ||||||||||||||||||||
Percentage of revenue | 76 | % | 78 | % | 78 | % | 77 | % | 77 | % | |||||||||||||||
Research, development, and engineering expenses (1) | 26,078 | 23,377 | 18,603 | 72,225 | 58,829 | ||||||||||||||||||||
Percentage of revenue |
10 | % | 14 | % | 13 | % | 13 | % | 15 | % | |||||||||||||||
Selling, general, and administrative expenses (1) | 61,054 | 52,518 | 42,072 | 160,093 | 123,125 | ||||||||||||||||||||
Percentage of revenue | 24 | % | 30 | % | 28 | % | 28 | % | 31 | % | |||||||||||||||
Operating income | 110,247 | 59,538 | 54,528 | 207,211 | 120,547 | ||||||||||||||||||||
Percentage of revenue | 42 | % | 34 | % | 37 | % | 37 | % | 31 | % | |||||||||||||||
Foreign currency gain (loss) | (127 | ) | (184 | ) | (607 | ) | (574 | ) | (377 | ) | |||||||||||||||
Investment and other income | 2,030 | 1,969 | 2,421 | 6,281 | 5,434 | ||||||||||||||||||||
Income before income tax expense | 112,150 | 61,323 | 56,342 | 212,918 | 125,604 | ||||||||||||||||||||
Income tax expense (benefit) | 9,802 | 5,251 | 2,667 | 8,843 | 14,030 | ||||||||||||||||||||
Net income from continuing operations | $ | 102,348 | $ | 56,072 | $ | 53,675 | $ | 204,075 | $ | 111,574 | |||||||||||||||
Percentage of revenue | 39 | % | 32 | % | 36 | % | 36 | % | 29 | % | |||||||||||||||
Net loss from discontinued operations | — | — | — | — | (255 | ) | |||||||||||||||||||
Net income | $ | 102,348 | $ | 56,072 | $ | 53,675 | $ | 204,075 | $ | 111,319 | |||||||||||||||
Percentage of revenue | 39 | % | 32 | % | 36 | % | 36 | % | 28 | % | |||||||||||||||
Basic earnings per weighted-average common and common-equivalent share: | |||||||||||||||||||||||||
Net income from continuing operations | $ | 1.18 | $ | 0.65 | $ | 0.63 | $ | 2.36 | $ | 1.31 | |||||||||||||||
Net loss from discontinued operations | — | — | — | — | — | ||||||||||||||||||||
Net income | $ | 1.18 | $ | 0.65 | $ | 0.63 | $ | 2.36 | $ | 1.31 | |||||||||||||||
Diluted earnings per weighted-average common and common-equivalent share: | |||||||||||||||||||||||||
Net income from continuing operations | $ | 1.14 | $ | 0.63 | $ | 0.61 | $ | 2.28 | $ | 1.29 | |||||||||||||||
Net loss from discontinued operations | — | — | — | — | (0.01 | ) | |||||||||||||||||||
Net income | $ | 1.14 | $ | 0.63 | $ | 0.61 | $ | 2.28 | $ | 1.28 | |||||||||||||||
Weighted-average common and common-equivalent shares outstanding: | |||||||||||||||||||||||||
Basic | 86,617 | 86,639 | 85,460 | 86,526 | 85,167 | ||||||||||||||||||||
Diluted | 89,677 | 89,614 | 87,346 | 89,562 | 86,805 | ||||||||||||||||||||
Cash dividends per common share | $ | 0.085 | $ | 0.085 | $ | 0.075 | $ | 0.245 | $ | 0.22 | |||||||||||||||
Cash and investments per common share | $ | 8.91 | $ | 8.84 | $ | 8.23 | $ | 8.91 | $ | 8.23 | |||||||||||||||
Book value per common share | $ | 13.09 | $ | 12.15 | $ | 11.02 | $ | 13.09 | $ | 11.02 | |||||||||||||||
(1) Amounts include stock option expense, as follows: | |||||||||||||||||||||||||
Cost of revenue | $ | 520 | $ | 454 | $ | 273 | $ | 1,404 | $ | 795 | |||||||||||||||
Research, development, and engineering | 2,765 | 2,715 | 1,366 | 8,090 | 4,942 | ||||||||||||||||||||
Selling, general, and administrative | 4,741 | 4,677 | 2,983 | 13,861 | 10,146 | ||||||||||||||||||||
Total stock option expense | $ | 8,026 | $ | 7,846 | $ | 4,622 | $ | 23,355 | $ | 15,883 |
Exhibit 2 |
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COGNEX CORPORATION
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Three-months Ended | Nine-months Ended | ||||||||||||||||||||||||
October 1, |
July 2, |
October 2, |
October 1, |
October 2, |
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Adjustment for stock option expense and tax benefit for stock option exercises | |||||||||||||||||||||||||
Operating income (GAAP) | $ | 110,247 | $ | 59,538 | $ | 54,528 | $ | 207,211 | $ | 120,547 | |||||||||||||||
Stock option expense | 8,026 | 7,846 | 4,622 | 23,355 | 15,883 | ||||||||||||||||||||
Operating income (Non-GAAP) | $ | 118,273 | $ | 67,384 | $ | 59,150 | $ | 230,566 | $ | 136,430 | |||||||||||||||
Percentage of revenue (Non-GAAP) | 46 | % | 39 | % | 40 | % | 41 | % | 35 | % | |||||||||||||||
Net income from continuing operations (GAAP) | $ | 102,348 | $ | 56,072 | $ | 53,675 | $ | 204,075 | $ | 111,574 | |||||||||||||||
Stock option expense | 8,026 | 7,846 | 4,622 | 23,355 | 15,883 | ||||||||||||||||||||
Tax effect on stock option expense | (2,639 | ) | (2,583 | ) | (1,520 | ) | (7,661 | ) | (5,207 | ) | |||||||||||||||
Discrete tax benefit related to employee stock option exercises | (8,620 | ) | (5,787 | ) | (6,038 | ) | (27,574 | ) | (7,246 | ) | |||||||||||||||
Net income from continuing operations (Non-GAAP) | $ | 99,115 | $ | 55,548 | $ | 50,739 | $ | 192,195 | $ | 115,004 | |||||||||||||||
Percentage of revenue (Non-GAAP) | 38 | % | 32 | % | 34 | % | 34 | % | 29 | % | |||||||||||||||
Net income from continuing operations per diluted weighted-average common and common-equivalent share (GAAP) | $ | 1.14 | $ | 0.63 | $ | 0.61 | $ | 2.28 | $ | 1.29 | |||||||||||||||
Share impact of non-GAAP adjustments identified above | (0.03 | ) | (0.01 | ) | (0.03 | ) | (0.13 | ) | 0.03 | ||||||||||||||||
Net income from continuing operations per diluted weighted-average common and common-equivalent share (Non-GAAP) | $ | 1.11 | $ | 0.62 | $ | 0.58 | $ | 2.15 | $ | 1.32 | |||||||||||||||
Diluted weighted-average common and common-equivalent shares outstanding (GAAP) | 89,677 | 89,614 | 87,346 | 89,562 | 86,805 | ||||||||||||||||||||
Exclusion of tax adjustments | |||||||||||||||||||||||||
Income before income tax expense (GAAP) | $ | 112,150 | $ | 61,323 | $ | 56,342 | $ | 212,918 | $ | 125,604 | |||||||||||||||
Income tax expense (benefit) (GAAP) | $ | 9,802 | $ | 5,251 | $ | 2,667 | $ | 8,843 | $ | 14,030 | |||||||||||||||
Effective tax rate (GAAP) | 9 | % | 9 | % | 5 | % | 4 | % | 11 | % | |||||||||||||||
Tax adjustments: | |||||||||||||||||||||||||
Discrete tax benefit related to employee stock option exercises | (8,620 | ) | (5,787 | ) | (6,038 | ) | (27,574 | ) | (7,246 | ) | |||||||||||||||
Other discrete tax events | (1,765 | ) | — | (1,436 | ) | (1,908 | ) | (1,332 | ) | ||||||||||||||||
Income tax expense excluding tax adjustments (Non-GAAP) | $ | 20,187 | $ | 11,038 | $ | 10,141 | $ | 38,325 | $ | 22,608 | |||||||||||||||
Effective tax rate (Non-GAAP) | 18 | % | 18 | % | 18 | % | 18 | % | 18 | % | |||||||||||||||
Net income from continuing operations excluding tax adjustments (Non-GAAP) | $ | 91,963 | $ | 50,285 | $ | 46,201 | $ | 174,593 | $ | 102,996 | |||||||||||||||
Percentage of revenue (Non-GAAP) | 35 | % | 29 | % | 31 | % | 31 | % | 26 | % | |||||||||||||||
Net income from continuing operations per diluted weighted-average common and common-equivalent share (GAAP) | $ | 1.14 | $ | 0.63 | $ | 0.61 | $ | 2.28 | $ | 1.29 | |||||||||||||||
Share impact of non-GAAP adjustments identified above | (0.11 | ) | (0.07 | ) | (0.08 | ) | (0.33 | ) | (0.10 | ) | |||||||||||||||
Net income from continuing operations per diluted weighted-average common and common-equivalent share (Non-GAAP) | $ | 1.03 | $ | 0.56 | $ | 0.53 | $ | 1.95 | $ | 1.19 | |||||||||||||||
Diluted weighted-average common and common-equivalent shares outstanding (GAAP) | 89,677 | 89,614 | 87,346 | 89,562 | 86,805 | ||||||||||||||||||||
Exhibit 3 |
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COGNEX CORPORATION
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October 1, 2017 | December 31, 2016 | ||||||||
Assets | |||||||||
Cash and investments | $ | 771,111 | $ | 745,170 | |||||
Accounts receivable | 121,976 | 55,438 | |||||||
Unbilled revenue | 51,612 | 2,217 | |||||||
Inventories | 48,061 | 26,984 | |||||||
Property, plant, and equipment | 65,957 | 53,992 | |||||||
Goodwill and intangible assets | 127,635 | 103,592 | |||||||
Other assets | 72,165 | 51,211 | |||||||
Total assets | $ | 1,258,517 | $ | 1,038,604 | |||||
Liabilities and Shareholders' Equity | |||||||||
Accounts payable and accrued liabilities | $ | 83,401 | $ | 52,369 | |||||
Deferred revenue and customer deposits | 16,072 | 8,211 | |||||||
Income taxes | 15,616 | 10,554 | |||||||
Other liabilities | 9,905 | 4,871 | |||||||
Shareholders' equity | 1,133,523 | 962,599 | |||||||
Total liabilities and shareholders' equity | $ | 1,258,517 | $ | 1,038,604 |
Exhibit 4 |
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COGNEX CORPORATION
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Three-months Ended | Nine-months Ended | ||||||||||||||||||||||||
October 1, |
July 2, |
October 2, |
October 1, |
October 2, |
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Revenue | $ | 259,739 | $ | 172,904 | $ | 147,952 | $ | 567,585 | $ | 391,431 | |||||||||||||||
Revenue by geography: | |||||||||||||||||||||||||
Europe | 56 | % | 36 | % | 50 | % | 44 | % | 46 | % | |||||||||||||||
Americas | 20 | % | 33 | % | 25 | % | 26 | % | 29 | % | |||||||||||||||
Greater China | 13 | % | 14 | % | 13 | % | 14 | % | 13 | % | |||||||||||||||
Other Asia | 11 | % | 17 | % | 12 | % | 16 | % | 12 | % | |||||||||||||||
Total | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||
Revenue by market: | |||||||||||||||||||||||||
Factory automation | 97 | % | 96 | % | 96 | % | 96 | % | 95 | % | |||||||||||||||
Semiconductor and electronics capital equipment | 3 | % | 4 | % | 4 | % | 4 | % | 5 | % | |||||||||||||||
Total | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % |
CONTACT:
Cognex Corporation
Susan Conway, 508-650-3353
Senior
Director of Investor Relations
susan.conway@cognex.com