NEWS FEB 2010
Cambridge Mechatronics battles through the recession to announce its first annual profit on record revenues
Cambridge, UK, February 1st, 2010 Cambridge Mechatronics Ltd (CML), a leading developer of Intellectual Property and components for precision electronic actuators used in high volume consumer products, today announced that (subject to Audit) it achieved record revenues and its first-ever profit during the financial year ended December 31st, 2009. That this achievement came in the midst of one of the deepest and longest recessions in modern economic history is further testament to the competitiveness of the company’s two major technology platforms;
Miniature Camera Auto-Focus Lens Actuators
During 2009 CML enjoyed the first revenues from its Shape Memory Alloy (SMA) Auto-Focus lens actuator platform, which has been in development since early 2006. These revenues were made up from:
1) Up front fees received from 2 new manufacturing licensees
2) Royalties on actuators shipped by licensees to camera integrators
3) Sales of proprietary semiconductor ICs to camera integrators
4) Sales of SMA wire to licensees
5) Sales of SMA specific Test & Measurement Equipment to licensees
This has resulted in CML being truly established as the world leader in the development of SMA-based lens actuators for Digital Imaging Products such as miniature cameras used in mobile phones. Perhaps more importantly, thanks to CML’s efforts, SMA-based actuation is now considered by many to be the preferred technology for the coming generation of miniature camera auto-focus mechanisms. This is because CML SMA-based actuators are smaller, faster and ultimately cheaper than the credible alternatives.
Although the product line has still some way to ago to achieve profitability, it enters 2010 with enormous momentum. During the coming year CML expects to see at least a 5X increase in Auto-Focus related revenues as the first licensees enter mass production and multiple new licensees are signed up. The company is currently predicting that its SMA platform will be cash generative during the second half of 2011.
Surround Sound Systems
CML is universally acknowledged as the inventor of the front rendered surround sound system now commonly referred to as the Soundbar. The company signed its first licensee for its Digital Sound Projector (DSP) platform in 2002, and then brought about its big break-through in 2004 when it licensed Yamaha. Since then multiple other licensees have been signed and the DSP platform has been generating profits for CML and its licensees every year. Yamaha’s licensed products’ success in particular have spawned many imitators, but without the superior performance advantages of CML’s phased-array-based ‘Concentrated Soundbeam’ technology. It was during 2009 that DSP began to really reward CML’s stakeholders for their patience by achieving the following:
1) Record license fee income
2) 2 new licensed Soundbars in production (bringing the total to 8)
3) 12 new licensed Flat Panel TVs in production (bringing the total to 15)
4) Record unit shipments of licensed products (resulting in record royalties)
5) 10 new international patents granted (bringing the total to 24)
6) Its 10th Industry award at the TV Innovations Conference in Beverley Hills
Patience Being Rewarded
Many of the company’s employees and investors have been with CML since the late nineties when the company first sought outside investment. Despite being granted 98 patents to date and an international reputation for technical excellence this is the first time the company has enjoyed any semblance of financial success.
"I am delighted that finally our employees and shareholders are seeing the first tangible evidence that their collective faith in the commercial viability of our inventions was justified" said Dr Tony Hooley, CML’s founder and serving Chief Scientific Officer. "Although we are still some way from an appropriate return for our effort and risk, at least we can see a credible path to our just rewards".
A Rosy Future
The company is confident that its current momentum will continue throughout 2010 and onwards. If this is the case, the company will enjoy a very profitable future, as the market for Auto-Focus actuators in mobile phones alone is forecast to be 600 million units by 2013. The market for Soundbars is also expected to grow rapidly, from approximately 2 million units in 2009 to 14 million units by 2014. The company is also working on new technology platforms, one of which will be announced during 2010.
"We are now positioned to take advantage of our brilliant employees’ endeavours" said Andy Osmant, CML’s Commercial Director and long-serving CFO. "For the first time ever we have a complete set. Working products, working capital and really hard-working licensees selling into growing markets".
In a tribute to the Government’s support of innovational product development, CML’s CEO, Simon Calder said "Although the huge majority of my gratitude goes to our employees and our extraordinarily patient and supportive shareholders, it must be acknowledged that R&D Tax credits and the EIS Scheme, combined to reduce our expenses and increase our working capital. This significantly increased our ability to succeed".