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