A message from Bruce Hoechner, CEO, Rogers Corporation:

Rogers continues to be well diversified by market. The markets that represent our megatrend focus areas of Internet Growth, Mass Transit, and Clean Technology drove 55% of net sales in the quarter, and we continue to believe they will help accelerate the Company’s growth going forward.

In markets supporting Internet Growth, consumer demand for higher functionality, speed, and bandwidth drove sales growth for Rogers’ solutions in both Internet devices and infrastructure applications, with sales up 11% quarter-over-quarter (Q4 of 2012 vs. Q4 of 2011). In Mobile Internet Devices, we continue to have a market leading position in cushioning and sealing for tablet computer and smart phone applications. In Internet Infrastructure applications, sales of printed circuit materials used in base station power amplifiers as well as smart antenna systems were up substantially due to wireless telecom network builds.

In Mass Transit, sales were basically even with the same quarter of last year.  China’s Ministry of Rail recently announced aggressive plans for increasing rail investment which may drive higher demand for our Power Distribution Systems for high-speed rail traction motors as programs begin to ramp up later this year.

Still impacted by the global slowdown of capital and infrastructure spending, Clean Technology sales were substantially lower than Q4 of last year.  Sequentially, however, we saw improvement in demand for some clean technology applications versus Q3.  We have also seen an increase in our order backlog for industrial motor drives and other applications, which would seem to indicate growing customer confidence in these markets.

In other markets, we achieved double-digit growth quarter-over-quarter and sequentially for our innovative cushioning and impact protection materials for personal protection.

Growing adoption of automotive safety sensors continued to boost demand for Rogers’ high frequency printed circuit materials with sales into this emerging technology area up significantly versus Q4 of 2011.  More stringent safety requirements are being adopted in Europe in order for cars to receive 5-star safety ratings.  As radar systems will help automakers achieve these coveted ratings, we believe the more demanding requirements will accelerate adoption of these systems.

We continue to build a solid pipeline of design opportunities across all three megatrend categories. At the end of the fourth quarter, we were working on 716 major design opportunities with 427 design-in wins.  During the quarter we saw many programs move out of design into production.  Our Q4 2012 opportunity pipeline compares favorably vs Q 4 2011 when we were working on 623 opportunities with 362 design-in wins. As a materials technology supplier of choice for many of the world’s leading innovators, we remain focused on partnering with customers in their design process for next generation products.

Our net sales were $124.2 million, a decline of 1% over last year’s fourth quarter, and 4% sequentially.  Q4-2012 vs. Q4-2011, our two largest business segments performed well with High Performance Foams revenues up 7%, and Printed Circuit Materials up 4%. In Power Electronic Solutions, our Power Distribution Systems business was up 8% due primarily to strong demand in the automotive market.  This growth was offset by a 23% decline in the Curamik substrates portion of our business as clean technology investments continue to be weighed down by the ongoing European fiscal crisis and clean tech regulatory and policy uncertainties in the US and other markets.

Looking at the businesses sequentially vs. Q3-2012, High Performance Foams demand was relatively flat due to some seasonality and a shift in display technology that reduced overall cushioning content per device for some platforms. Printed Circuit Materials revenues were down 11%, due primarily to year-end inventory corrections to match demand in LNB Satellite TV applications.

In the Power Electronics Solutions segment, we saw improvement over Q3.  Power Distribution Systems sales were up 11% as demand continued to ramp in several key markets related to Automotive and Clean Technology.  Revenues for Curamik Electronic Solutions were basically flat over Q3.

Moving forward, we are seeing positive indicators for growth across several of our markets, particularly those supporting Internet Growth, Mass Transit, and Automotive Safety.  The streamlining and operational improvements we began in 2012 have positioned us well as markets improve.  We believe that all of our businesses have strong growth prospects as we look toward the future. We remain disciplined in our focus on delivering greater value to our customers and shareholders in 2013 and for years to come.

Read the full 2012 Fourth Quarter and Year-End Results press release.

A message from Bruce Hoechner, CEO, Rogers Corporation:

We announced our third quarter earnings on November 5th, a week later than planned due to Hurricane Sandy.  We weathered the great storm well in Connecticut although thousands are still without power.  My sincere thanks to all our employees who made sure that our customers saw as little interruption as possible due to this crisis.  Our thoughts are with those folks who were severely impacted by the storm.  Rogers has already donated $20,000 to the Red Cross storm relief effort and we are investigating how else we can help.

For the third quarter of 2012, our businesses generated net sales of $130.2 million, a decrease of 11.6% from last year’s third quarter.  The majority of the decline was in our Power Electronics segment reporting a 35% decline.  This segment was hard hit due to markets it serves such as industrial motor controls, driven by capital investment, and renewable energy markets that rely on governmental infrastructure investment.

We believe these markets have bottomed out and we will begin to see improvements in demand by the second half of 2013.  In comparison with the results for Q3-2011, High Performance Foams was down 3.5%, while Printed Circuit Materials achieved a 1% increase for the quarter. Sequentially, however, we achieved an overall 3% net sales improvement versus the second quarter of 2012, with both High Performance Foams and Printed Circuit Materials reporting strong growth at 10.9% and 7.2%, respectively. Power Electronics Solutions declined 11.4% versus last quarter.

Although we expect our commitment to the megatrend focus areas of Clean Technology, Internet and Mass Transit to help accelerate the Company?s growth over the next few years, economic and market dynamics impacted results in the third quarter.  These megatrends drove 53% of net sales in the quarter, down from 60% in Q3 of 2011.  Hardest hit was our Clean Technology megatrend category where the ongoing slowdown in capital and infrastructure spending continues to impact demand for our power electronics solutions for industrial motor drive and wind energy applications.  However, we have seen a significant increase in demand for our power distribution systems into several projects in the automotive market.  In Mass Transit, we have not yet seen the rebound in rail investment in Europe and China that we expect will drive demand for our Power Distribution Systems products.

As for the Internet megatrend, in Mobile Internet Devices, our High Performance Foams business continues to be a market leader in cushioning and sealing for tablet computer applications, but timing of tablet model changes left inventory in the supply chain, preventing it from being a stronger quarter.   Sales were strong for our PORON® XRD® cushioning materials for mobile device cases, also used in sports impact apparel.  In Internet Infrastructure, our Printed Circuit Materials business showed strong growth in products that enable the latest smart antenna technologies.   Sales for base station power amplifier applications were up vs. last quarter, a sign we believe indicates that the highly anticipated wireless infrastructure build is beginning to ramp.   On the wired network side, our recently launched Theta® high speed digital product has won several qualifications but development of demand has been slower than previously anticipated.  We have put our capacity expansion for that product on hold for now as we work to align capacity with our latest view of market timing.

Despite the difficulties we face in the global economy, we exit the third quarter with strong growth, quarter on quarter, in two of our largest businesses and we believe that all of our businesses have strong growth prospects as we look toward the future.  Rogers remains focused on improving our execution, identifying new growth opportunities, and managing the areas that are within our control.  As technology leaders in our key markets, we are seeing positive indicators of continued growth in our High Performance Foams and Printed Circuit Materials businesses.   In Power Electronics Solutions, we are not seeing a rebound yet but we are aligning our cost structure so that Rogers will be in a strong position to deliver even greater value to our customers and shareholders in the years to come.

Read the full press release

There has been lots of discussion of how manufacturing is becoming a thing of the past in the United States. Well, we were happy to read in this New York Times article “Does America Need Manufacturing” that there is a shift happening in area of advanced battery technology to help make advancements in clean energy technology.   Not only has the government been providing stimulus money to help drive these efforts, but it’s also promising to help job creation in this tough economy.  Clean energy technology is one of our megatrends that we track, and are actively working on developing new products in this area.

The article notes:

In 2009, the U.S. made less than 2 percent of the world’s lithium-ion batteries. By 2015, the Department of Energy projects that, thanks mostly to the government’s recent largess, the United States will have the capacity to produce 40 percent of them. Whichever country figures out how to lead in the production of lithium-ion batteries will be well positioned to capture “a large piece of the world’s future economic prosperity,” says Arun Majumdar, the head of the Department of Energy’s Advanced Research Projects Agency-Energy (ARPA-E). The batteries, he stressed, are essential to the future of the global-transportation business and to a variety of clean-energy industries.

This is good news, we hope the trend continues in this direction.  We are doing our part in advancing this technology.  We recently launched our RO-LINX® PowerCircuit™ Busbars that enable the effective distribution of high voltages and large currents in power electronic modules for HEVs and EVs, while minimizing physical and thermal constraints. On another side, we are working to create more effective lithium ion battery pack assemblies and enclosures using silicone and urethane foams to protect this sensitive technology from harsh environments, improve durability and help extend battery life and capacity which is a huge issue when it comes to all types of EVs.

One thing is for certain, this is a rapidly moving technology that is evolving very quickly. Lithium ion batteries are where it’s at today, but we anticipate there are more advanced battery technologies that are in development now that could become a game changer in clean technology. At Rogers, we’ll continue to be committed to staying on top of clean technology trends and will be developing new products to help respond and meet consumer demands for even better HEV and EV solutions.

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