Don Kania, 51, recruited from Veeco Instruments Inc. of Woodbury, N.Y., where Kania had been president and chief operating officer since 1998. He started at FEI in mid-August 2006, just as the company’s turnaround was beginning to accelerate, with two great quarters in a row. Competition in this space is fierce and companies are in a race to introduce new products, Kania told Small Times Contributing Editor Jo McIntyre, but he says FEI is well positioned for good results.
Q: What steps have been taken, both before and after your arrival, to return FEI to profitability?
Before I came, there was a significant restructuring that was complete when I came on board. We closed the Peabody (Mass.) operation and several sites in Europe. That allows you to operate more efficiently. Revenues have increased and orders have gone up. We are shifting to higher margin products and are doing a good job of controlling costs. There’s a big difference between restructuring and growing.
The best way to delineate what’s happened since I showed up is that the mantra now is “profitable growth.”
Q: When do you expect commerce to overtake research as a market for S/TEMs?
Today, they’re not far out of balance. Industrial class customers make up at least half of our customer base, but that includes researchers at industrial companies. In applications, manufacturing is about two-thirds of our business, compared to research which is one-third. And about one-quarter of our business is in service.
Big sales used to be to Intel and Hitachi. The recently announced big sales to universities are a big shift. Five years ago universities were building new spaces for nanotechnology research. The brick and mortar is now in place and that leads them to being ready to fill the building with tools. We’ve done a great job of filling them. They are buying our stuff in bulk.