RAE Systems Inc. (RAE)
Q1 2010 Earnings Call
May 5, 2010 04:30 pm ET
Bob Durstenfeld – Director IR
Robert Chen - CEO
Randy Gausman - CFO
Ken Liddy - Wells Fargo
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Welcome to the RAE Systems Inc. 2010 conference call. At this point, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. As a reminder, today's call is being recorded. I would now like to turn the call over to Bob Durstenfeld, Director of Investors Relations.
Thank you. Good afternoon everyone. And thank you for joining us today. With me today are Bob Chen, our Chief Executive Officer and Randy Gausman our Chief Financial Officer. If you have not seen today's earnings release be retrieved from our website at raesystems.com or from marketwire Yahoo finance or similar websites.
If you would like a replay of this conference call it can be retrieved two hours after this call from our website, or from links in the call announcement. I would like to remind you that the matters that we will be discussing today include forward-looking statements and as that term is used in section 21E of the Securities and Exchange Act of 1934 and as such are subject to risks and uncertainties.
Forward-looking statements may include without limitation expressions of believes, anticipation or expectations of management, statements of the industry trends or future results of operations of RAE Systems and its subsidiaries and other statements that are not historical fact. These types of statements address matters that are subject to risks and uncertainties which could cause actual results to differ materially. Factors that could cause or contribute to such differences include but are not limited to general economic and industry factors and their receptiveness of the market to RAE Systems and its products.
In addition to our forward-looking statements, should be considered in the context of other risk factors discussed in our filing with the Securities and Exchange Commission including but not limited to our Annual Report on Form 10-K and form 10-Q filings available online at www.sec.gov or our website. All forward looking statements are based on information available to the company on the date hereof and the company assumes no obligation to update such statements. As a reminder, we will not be commenting on analyst models.
Today, Bob Chen will review our first quarter highlights and business outlook for 2010. Randy Gausman will review the financial results for the first quarter ended March 31
, 2010. Following a brief summary by Bob Chen, we will open up the call for questions and answers.
I will now turn the call over to Bob Chen, Bob, go ahead please.
Thank you, Bob. Good afternoon and thank you for joining us on our first quarter 2010 conference call. This afternoon, I will make a few comments about our just completed first quarter. And then, I will focus my remarks on the future business outlook for RAE Systems.
For the first quarter of 2010, we posted revenue of $18.8 million, which represents our second best first quarter revenue performance in the company's history. Our gross margin was 54%, our highest gross margin in the last four quarters, also in the first quarter, we recorded a small net loss of $0.01 per share. We are encouraged by our improving operating performance during the current economic environment.
Now, I want to focus my remaining remarks on the future. Our vision for RAE Systems is to be the leading sensing solution provider in the safety and security industry recognized for innovation and business performance. We have established our reputation as the leading innovator of photo ionization detectors and radiation solutions. That we are advancing with a further development of wireless, intelligence, connected sensor networks.
For example, we began by introducing wireless enabled photo ionization detectors, combined with our proprietary RAELink 3 wireless modem. We can now deliver real time GPS location and sensor data over our area wireless sensor network. A RAELink 3 is the bridge to deliver both RAE Systems and third party instrumentation information utilizing the AreaRAE wireless platform.
We have continued our advancement in wireless products with a introduction in 2009 of the AreaRAE Inerts and Mesh Guard. We expect that both of these products will enable us to further penetrate the oil and gas drilling and processing markets worldwide. After the just completed Fire Department Instructors' Conference, we preview ProRAE Guardian, which is an advanced generation virtual command center for intelligent wireless monitoring.
ProRAE Guardian improves the performance levels and ease of the use in the remote monitoring of wireless gas detection systems and networks. The ProRAE Guardian platform enables our customers to monitor wirelessly enabled RAE Systems products and complimentary third party products on a single platform. This is an exciting innovation that will address additional applications about wireless sensor networks in our global markets.
Furthermore, we are continued to make investments in broadening our product portfolio. Developing a new application for our product and evaluating opportunities to expand the applications for our innovative technologies into adjacent markets. We are scaling up our global marketing efforts to educate users on the advantage of deploying wireless technology we were continuing make investments in R&D a priority to develop a new generation of wireless toxic gas and radiation instruments, in addition to intelligence software monitoring systems, while the economic environment remains challenging, and impacts our performance.