Prepress supplier system supplier Creo has announced revenue of $174.6M in the first quarter of 2005, an increase of 12.4 per cent from the first quarter of 2004. Net earnings were $5.9M. Earnings before taxes and other items increased by 64 per cent to $7.3M. Consumables revenue reached $27.9M this quarter, an increase of 109.1 per cent over last year and 16.3 per cent up on the fourth quarter of 2004.
Gross margin in the first quarter of this year was 40.6 per cent, compared with 43 per cent in the first quarter of 2004. Total operating expenses of $63.6M for the first quarter of 2005 were stable compared with $62.4M in the first quarter of 2004. As a percentage of revenue, total operating expenses declined by 380 basis points to 36.4 per cent against 40.2 per cent in the prior year’s first quarter.
Cash used by operations was $5.4M, reflecting a significant increase in accounts receivable as a result of higher revenue, increased inventory levels due to the ramp-up of the plate business, and the timing of vendor and restructuring payments.
Subsequent to the quarter end, Creo entered into an arrangement agreement to be acquired by Eastman Kodak (see February issue, page 7). Kodak will acquire all of the issued and outstanding common shares of Creo at a cash price of approximately $980M. Creo shareholders will vote upon the proposed transaction at the rescheduled annual meeting to be held on March 29, 2005.
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