Optical Communications Products, Inc. (OCPI)
This is a printer friendly page!
Communications Products believes their investment into R&D, sales & marketing and
acquisitions will make them the front-runner when the market recovers
Dr. Tran: OCP was founded in 1991. The company went public in November of 2000; Furakawa Electric Company of Japan is now our major shareholder, and owns about 60% of the company. We focused on the fiber-optic market in the metro networks, local area networks and storage area networks.
CEOCFOinterviews: What are your main products and who is using them?
Dr. Tran: We supply optical modules and subsystems to the fiber-optic industry. Our customers are the fiber-optic equipment manufacturers, such as Alcatel (NYSE: ALA), Cisco Systems, Inc. (NASD: CSCO), Lucent Technologies (NYSE: LU), and Nortel Networks (NYSE: NT).
CEOCFOinterviews: Do you need to maintain a big inventory of your various products?
Dr. Tran: No. In the current climate, we are shipping products through short lead orders; we have very little inventory of our products because the demand and visibility right now are limited. We dont want to stock products.
CEOCFOinterviews: How else have you adapted to the current economic climate and how do you weather the storm?
Dr. Tran: The fiber-optic industry has been down for a year or two now and obviously we have to manage the company accordingly. Our revenue now is lower than our revenue a year-and-a-half ago. We broke-even in profitability in our last fiscal year, which ended in September, 2002. In this environment, most of companies are losing money. We have been efficient in running the company. I think one thing that is unique about OCP is, even in this environment, we are still investing in the company. We are focused on expanding our R&D capability to ensure that we have the breadth of products to serve into this market. We are also investing in expanding our sales and marketing force. We believe in the long-run the market will recover, and once it recovers we could be the front-runner.
CEOCFOinterviews: What is it which sets you apart from your competitors?
Dr. Tran: I think we have a fair number of competitive advantages. We have a technology that makes our products better in performance than our competitors. We also focus a lot in the servicing of customers and working closely with the customers to find out exactly what they need for their products. The other thing that sets us apart in this environment is that we are very strong financially; we have plenty of cash in our company so that we can continue to invest in developing the product and service customers the way they want to be serviced. We are a long-term viable supplier to our customers.
CEOCFOinterviews: I noticed that you have a new V.P. in corporate development. What are you planning to do in that area?
Dr. Tran: That is tied back to our plans to expand the company operations. While other companies are stepping down, we are actually stepping up to do it. We want to expand the company and strengthen our operation and look at where our business opportunities are. We have made a number of acquisitions, for example recently we acquired the business of Cielo Communications, and the array products of Gore Photonics. These are examples of where we invest in order to strengthen our technology base. We are always looking around for opportunities that will fit with our plan.
CEOCFOinterviews: How often do you bring out new products?
Dr. Tran: In product development, we work closely with our customers. Through our product announcements, we introduce new product families that we offer to the customers. We also often introduce products which are improved or enhanced versions of our product lines.
CEOCFOinterviews: How do you market to your customers?
Dr. Tran: Right now, the market is different than it was a few years ago; customers usually need to know a lot about you before they buy from you. We have a number of customers that we have been working with for many years. At the same time, we also target new customers that we have not worked with. We usually target a certain market area and identify who the players are in these markets and we go and market our products to these customers. We have been expanding our marketing organization; we have our Director of marketing who joined us a while back.
CEOCFOinterviews: It sounds like you are taking advantage of the opportunities available to you!
Dr. Tran: That is exactly right, and that is why we do what we do, which is simply the reverse of what most other companies are doing. I think this is the right time to invest. We have the financial resources to go forward without any problem.
CEOCFOinterviews: It looks like you are selling at about half of book value!
Dr. Tran: I believe the investor will see the value in OCP, compared to some other companies in the market place. I believe the investor can distinguish OCP strategy and market position from other fiber-optics companies.
CEOCFOinterviews: What should potential investors know that perhaps they dont realize when they look at your company?
Dr. Tran: I think it is hard to say because each investor looks at a company differently. What we really want the investor to realize is our revenue is stable and our spending has not been that high even with our investment. Our balance sheet is very strong. OCP is positioned to be a long-term supplier and we have a lot of confidence. Our customers know that we will not exit the market; therefore, we are a viable supplier. We are working hard and looking at what we need and where we want to be a year or two and two years from now, and we have taken a lot of action to move OCP into that position so that when the market recovers, we could be the front runner.
To view Releases highlight & left click on the company name!
ceocfointerviews.com does not purchase or
recommendation on stocks based on the interviews published.