Boring makes the big bucks, or so it seems at manufacturer Laserbond (ASX:LBL) which has just upgraded its profit guidance again.

The company says full year revenue should come in between $21.6m and $22.6m, up 38-42 per cent over last year, and EBITDA (earnings before interest, tax, depreciation and amortisation) is expected at $4.3-4.6m, up 109 per cent.

Laserbond lifted half year revenue guidance in January by 45 per cent, and last year lifted full year revenue by 27 per cent.

ASX investors began to take note of the company after July last year, and today sent the stock up 22 per cent to 41c.

Since July the stock is up 215 per cent.


Fricken lasers

The company has three arms — services, products and technology — based on a laser cladding technology which it sells to a range of industries from mining to marine.

According to company secretary Matthew Twist, the base process involves spraying a metal powder coating onto worn machinery in order to “reclaim” it and put it back into use.

Gregory Hooper started the company in 1993 and was soon joined by brother Wayne, and both still run the company.

The problem with a coating however is that in hard wearing or corrosive environments it can crack and peel off. Welding allows the coating to bond with the base metal, but you can’t get a refined finish.

So the brothers Hooper invented a laser which they commissioned in 2002 which offers the strength of a weld with a refined edge, Twist says.

Today the company offers laser cladding as well as other machinery processes as a service by rejigging old parts.

In the last few years it set up a products division, working with original equipment manufacturers (OEMs) to build bespoke products. It is now moving into selling its own branded products, starting with steel mill rolls which it’s selling into the US market.

And as of late last year the technology division launched where they sell the laser cladding equipment under licence.

Twist said they now shipping the second piece of equipment to a UK company under a seven year licence, which will see them provide support as well as technology upgrades.

Show me the mo’ney

Laserbond spent the last three years investing in people, equipment and R&D on new technologies and applications, Twist says.

Further investments will follow, as Twist says they’ve got spare capacity to grow because a lot of their equipment isn’t manned all day.

All came to fruition this year with that $20m-plus revenue guidance. The board had been expecting this, but it has clearly caught the market by surprise.

The company is targeting $40m in revenue by 2022.

The company has been profitable every year except 2016 and pays dividends. The 2018 full year payout was 0.4c a share