German industrial laser technology company OR Laser, makers of the ORLAS Creator metal 3D printer, has been acquired by photonics manufacturer and developer Coherent (NASDAQ:COHR) headquartered in Santa Clara, CA.
In an investor call reporting financial results for Q2 2018, Coherent CEO John Ambroseo noted a “tremendous growth” in the metal additive manufacturing industry, and attributed the acquisition, in part, to OR Laser’s solutions that help to alleviate a “log-jam for innovation.”
Second quarter financial results for Coherent
Reporting second quarter financial statements ending March 31, 2018, Coherent showed flat revenues and a significant increase in the earning per share at $2.61.
For the first 6 months of the fiscal year 2018, Coherent earnings per share stands at $4.29 versus $2.95 for the previous year period. The company has a healthy cash position of $347M at end March 2018, with financial long term debt at circa $450M, and nearly no short term financial debt.
In addition to the OR investment, Coherent has continued making voluntary prepayments on its debt. The most recent prepayment of €60 million brings the total voluntary reduction to €285 million, since the company initiated its debt reduction policy.
Coherent financial performance is particularly tied to the demand for OLED displays used in mobile phones, digital cameras and media players.
In the quarterly conference call Abroseo shared in great details his optimistic view on the future demand for Coherent systems. “The takeaway is simple,” he says, “It is reasonable to discuss the timing of certain investments such as Samsung’s A5 fab, but we believe the future of OLEDs is very bright.”
The uncertainty on the demand for Coherent systems in relation to flat displays has significantly weighted on the company share price that nearly halved since its peak of January 2018.
OR Laser’s creative advantage
Released at formnext 2016, the ORLAS Creator is powder bed fusion based metal 3D printer. It has a build chamber measuring 100 mm in diameter x 110 mm high, and an enclosed ambient argon/nitrogen printing environment.
Interestingly, 3D printing in the Creator bypasses the typical .stl and .gcode generating slicing stage, and has the ability to 3D print directly from a CAD model.
This direct CAD 3D printing feature was a deciding factor in the acquisition. Ambroseo comments,
“Industry data shows that metal AM machine unit sales grew 80 per cent in 2017 versus 2016. Despite these impressive numbers, the market is constrained, in part, by process development and process knowledge.”
“Many of the existing tool providers in metal AM are providing process development services and encoding the parameters into their tools. While this may ensure reproducibility and quality, it creates a log-jam for innovation.”
To alleviate this “log-jam” Ambroseo explains, “[OR Laser] has also developed a complete AM software suite so no third-party software is needed to go from a CAD model to printed part.
“We believe this combination will be critical in opening up the metal AM market. We also see opportunities for process improvement in the types of lasers being applied in metal AM.”
Future direction of OR Laser will be guided towards the aerospace and automotive industries.
Market consolidation
It is interesting to notice that with this acquisition, another European company has been snapped up by an American player. Notably, American multinational conglomerate GE acquired metal 3D printing companies Concept Laser, from Germany, and Arcam AB, from Sweden.
To further its position in the dental market, 3D Systems bought Dutch company Vertex-Global Holding B.V in 2017.
The industry has also seen significant activity between companies within Europe as well. Prodways Group, part of Groupe Gorgé, has acquired a 75% stake in fellow French company Interson-Protac, and German chemical giant BASF now wholly owns Dutch premium filament maker Innofil3D.
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Featured image shows a metal 3D print of the classic rook and double helix from the ORLAS CREATOR. Photo by Michael Petch.
