Amtech Reports First Quarter Fiscal 2018 Results
TEMPE, Ariz., Feb. 8, 2018 /PRNewswire/ -- Amtech Systems, Inc. (NASDAQ: ASYS), a global manufacturer and supplier of production equipment and related supplies for the solar, semiconductor and LED markets, today reported results for its first quarter ended December 31, 2017.
First Quarter Fiscal 2018 Financial and Operational Highlights:
-- Net revenues of $73.6 million (solar $49.2 million)
-- Net income of $6.5 million
-- Diluted earnings per share of $0.42
-- Customer orders of $37.3 million (solar $7.3 million)
-- Quarter-end backlog of $65.9 million (solar $39.3 million)
-- Book to bill ratio of 0.5:1 (0.1:1 solar)
-- Unrestricted cash of $52.7 million
Mr. Fokko Pentinga, Chief Executive Officer of Amtech, commented, "As anticipated, we had a very good start to our fiscal 2018. In the December quarter we had record revenues with an even higher record level of shipments, along with solid profitability. All three of our reporting segments, solar, semiconductor, and polishing, performed well, with our semiconductor and polishing segments outperforming our expectations. Our financial position is strong and we continue to make strategic investments in our businesses and to focus on operational excellence."
Net revenue for the first quarter of fiscal 2018 was $73.6 million compared to $54.7 million in the preceding quarter and $29.1 million in the first quarter of fiscal 2017. The sequential increase is due primarily to the shipment of all of the equipment for Phase II of the solar turnkey order and increased sales of our polishing templates. The increase from the prior year quarter is due primarily to shipments relating to Phase II of the solar turnkey order, as well as increased shipments of our semiconductor equipment and sales of our polishing templates.
Net income for the first quarter of fiscal 2018 was $6.5 million, or $0.42 per diluted share, compared to a net loss of $0.1 million, or $0.00 per share for the first quarter of fiscal 2017 and net income of $7.3 million or $0.51 per diluted share in the preceding quarter.
Unrestricted cash and cash equivalents at December 31, 2017 were $52.7 million, compared to $51.1 million at September 30, 2017.
At December 31, 2017, our total order backlog was $65.9 million (solar $39.3 million), compared to total backlog of $102.4 million (solar $81.4 million) at September 30, 2017. Backlog includes deferred revenue and customer orders that are expected to ship within the next 12 months.
Gross margin in the first quarter of fiscal 2018 was 28%, compared to 36% in the preceding quarter and 29% in the first quarter of fiscal 2017. Sequentially, gross margin decreased primarily due to $2.1 million in revenue deferrals in the first quarter of fiscal 2018, compared to the recognition of $1.5 million of previously deferred profit in the fourth quarter of fiscal 2017. Additionally, less utilization of previously reserved inventory and sales of lower-margin products in our semiconductor segment contributed to the sequential decrease in gross margin. Compared to the prior year quarter, gross margin decreased slightly on higher sales volumes due to a lower-margin product mix and a deferral of profit in the first quarter of fiscal 2018, compared to recognition of previously deferred profit in the first quarter of fiscal 2017.
Selling, general and administrative expense ("SG&A") in the first quarter of fiscal 2018 were $10.6 million, compared to $9.8 million in the preceding quarter and $7.0 million in the first quarter of fiscal 2017. Sequentially, the SG&A increase was due primarily to increased commissions and freight related to the higher revenues, partially offset by lower employee-related expenses. The increase in SG&A from the prior year quarter is due primarily to higher commissions, freight, and other selling expenses. For the three months ended December 31, 2016, SG&A expenses include the collection of previously reserved accounts receivable of approximately $1.0 million which contributed to the year-over-year increase.
Research, development and engineering (RD&E) expense was $2.0 million in the first quarter of fiscal 2018 compared to $1.8 million in the preceding quarter and $1.6 million in the first quarter of fiscal 2017.
Income tax expense in the first quarter of fiscal 2018 was $1.2 million compared to $0.5 million in the preceding quarter and $0.1 million in the first quarter of fiscal 2017.
Outlook
The company expects revenues for the quarter ending March 31, 2018 to be in the range of $26 to $29 million. Gross margin for the quarter ending March 31, 2018 is expected to be in the mid 20 percent range, with operating margin slightly negative.
The solar and semiconductor equipment industries can be cyclical and inherently impacted by changes in market demand. Additionally, operating results can be impacted by the timing of orders, system shipments and the financial results of the solar and semiconductor businesses. The results for the second half of fiscal 2018 will be significantly influenced by the timing of the Phase III order of the 1GW turnkey project. Operating results could also be affected by the net impact of revenue deferral on shipments, and recognition of revenue based on customer acceptances, and progress on the start-up of the turnkey production lines, all of which can have a significant effect on operating results.
A substantial portion of Amtech's revenues are denominated in Euros. The revenue outlook provided in this press release is based on an assumed exchange rate between the United States Dollar and the Euro. A significant decrease in the value of the Euro in relation to the United States Dollar could cause actual revenues to be lower than anticipated.
Conference Call
Amtech Systems will host a conference call and webcast today at 5:00 p.m. ET to discuss first quarter fiscal 2018 financial results. Those in the USA wishing to participate in the live call should dial (844) 868-9329. From Canada, dial (866) 605-3852, and internationally, dial (412) 317-6703. Request "Amtech" when connected to the operator. A replay of the call will be available one hour after the end of the conference call through February 15, 2018. To access the replay please dial US toll free (877) 344-7529 and enter code 10116145. Internationally, dial (412) 317-0088 and use the same code. A live and archived web cast of the conference call can be accessed in the investor relations section of Amtech's website at www.amtechsystems.com.
About Amtech Systems, Inc.
Amtech Systems, Inc. is a global supplier of advanced thermal processing equipment to the solar, semiconductor / electronics, and LED manufacturing markets. Amtech's equipment includes diffusion, ALD and PECVD systems and solder reflow systems. Amtech also supplies wafer handling automation and polishing equipment and related consumable products. The Company's wafer handling, thermal processing and consumable products currently address the diffusion, oxidation, and deposition steps used in the fabrication of solar cells, LEDs, semiconductors, MEMS, printed circuit boards, semiconductor packaging, and the polishing of newly sliced sapphire and silicon wafers. Amtech's products are recognized under the leading brand names Tempress Systems(TM), Bruce Technologies(TM), PR Hoffman(TM), R2D Automation(TM), SoLayTec, and BTU International.
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this press release is forward-looking in nature. All statements in this press release, or made by management of Amtech Systems, Inc. and its subsidiaries ("Amtech"), other than statements of historical fact, are hereby identified as "forward-looking statements" (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). The forward-looking statements in this press release relate only to events or information as of the date on which the statements are made in this press release. Examples of forward-looking statements include statements regarding Amtech's future financial results, operating results, business strategies, projected costs, products under development, competitive positions, and plans and objectives of Amtech and its management for future operations. In some cases, forward-looking statements can be identified by terminology such as "may," "will," "should," "would," "expects," "plans," "anticipates," "intends," "believes," "estimates," "predicts," "potential," "continue," or the negative of these terms or other comparable terminology or our management are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. The Form 10-K that Amtech filed with the Securities and Exchange Commission (the "SEC") for the year-ended September 30, 2017, listed various important factors that could affect the company's future operating results and financial condition and could cause actual results to differ materially from historical results and expectations based on forward-looking statements made in this document or elsewhere by Amtech or on its behalf. These factors can be found under the heading "Risk Factors" in the Form 10-K and investors should refer to them. Because it is not possible to predict or identify all such factors, any such list cannot be considered a complete set of all potential risks or uncertainties. Except as required by law, we undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events, or otherwise.
Contacts:
Amtech Systems, Inc. Christensen
Robert T. Hass Investor Relations
Chief Financial Officer Patty Bruner
(480) 967-5146 (480) 201-6075
irelations@Amtechsystems.com pbruner@christensenir.com
AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
February 8, 2018
(Unaudited)
Condensed Consolidated
Statements of Operations
(in thousands, except per
share data)
-------------------------
Three Months Ended
December 31,
2017 2016
---- ----
Revenues, net of returns
and allowances $73,611 $29,135
Cost of sales 53,274 20,692
Gross profit 20,337 8,443
Selling, general and
administrative 10,580 6,996
Research, development and
engineering 1,991 1,627
----- -----
Operating income (loss) 7,766 (180)
Loss from equity method
investment (26) (143)
Interest and other
expense, net (48) 81
--- ---
Income (loss) before
income taxes 7,692 (242)
Income tax provision 1,240 90
----- ---
Net income (loss) 6,452 (332)
----- ----
Add: net loss attributable
to noncontrolling
interest - 279
--- ---
Net income (loss)
attributable to Amtech
Systems, Inc. $6,452 $(53)
====== ====
Income (Loss) Per Share:
Basic income (loss) per
share attributable to
Amtech shareholders $0.44 $0.00
Weighted average shares
outstanding 14,781 13,179
Diluted income (loss) per
share attributable to
Amtech shareholders $0.42 $0.00
Weighted average shares
outstanding 15,298 13,179
AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
February 8, 2018
(unaudited)
Condensed
Consolidated
Balance
Sheets
(in thousands,
except share
data)
--------------
December 31, September 30,
2017 2017
---- ----
Assets
------
Current Assets
Cash and cash
equivalents $52,696 $51,121
Restricted
cash 9,913 24,640
Accounts
receivable
Trade (less
allowance for
doubtful
accounts of
$1,473 and
$866 at
December 31,
2017, and
September 30,
2017,
respectively) 24,365 22,519
Unbilled and
other 21,620 14,275
Inventories 22,762 30,210
Vendor
deposits 5,180 11,806
Other 2,310 2,542
----- -----
Total current
assets 138,846 157,113
Property,
Plant and
Equipment -
Net 15,637 15,792
Intangible
Assets -Net 3,378 3,495
Goodwill - Net 11,484 11,405
Investments 2,588 2,615
Deferred
Income Taxes
- Long-Term 200 200
Other Assets -
Long-Term 980 1,003
--- -----
Total Assets $173,113 $191,623
======== ========
Liabilities
and
Stockholders'
Equity
--------------
Current
Liabilities
Accounts
payable $20,483 $21,555
Accrued
compensation
and related
taxes 7,422 7,592
Accrued
warranty
expense 1,401 1,254
Other accrued
liabilities 2,918 2,056
Customer
deposits 19,328 48,784
Current
maturities of
long-term
debt 365 361
Deferred
profit 5,632 4,081
Income taxes
payable 1,608 286
----- ---
Total current
liabilities 59,157 85,969
Long-Term Debt 8,225 8,134
Income Taxes
Payable -
Long-Term 6,802 7,037
----- -----
Total
Liabilities 74,184 101,140
Commitments
and
Contingencies
Stockholders'
Equity
Preferred
stock;
100,000,000
shares
authorized;
none issued - -
Common stock;
$0.01 par
value;
100,000,000
shares
authorized; 149 147
shares issued
and
outstanding:
14,876,430
and
14,710,591 at
December 31,
2017, and
September 30,
2017,
respectively
Additional
paid-in
capital 127,015 125,564
Accumulated
other
comprehensive
loss (7,988) (8,529)
Retained
deficit (20,247) (26,699)
------- -------
Total equity 98,929 90,483
------ ------
Total
Liabilities
and
Stockholders'
Equity $173,113 $191,623
======== ========
AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
February 8, 2018
(unaudited)
Condensed Consolidated Statements of
Cash Flows
(in thousands)
-------------
Three Months Ended December 31,
2017 2016
---- ----
Operating Activities
Net income (loss) $6,452 $(332)
Adjustments to reconcile net loss to
net
cash provided by (used in) operating
activities:
Depreciation and amortization 471 654
Write-down of inventory 41 33
Capitalized interest 143 190
Deferred income taxes (7) 31
Non-cash share based compensation
expense 253 319
Loss from equity method investment 26 143
Provision for (reversal of) allowance
for doubtful accounts, net 48 (1,178)
Changes in operating assets and
liabilities:
Restricted cash 14,885 (2,425)
Accounts receivable (8,869) (3,600)
Inventories 7,558 1,621
Accrued income taxes 1,087 239
Vendor deposits and other assets 6,974 725
Accounts payable (1,255) 78
Customer deposits and accrued
liabilities (29,023) 584
Deferred profit 1,479 (619)
----- ----
Net cash provided by (used in)
operating activities 263 (3,537)
--- ------
Investing Activities
Purchases of property, plant and
equipment (93) (86)
Proceeds from sale of property, plant
and equipment - 1
Net cash used in investing activities (93) (85)
--- ---
Financing Activities
Proceeds from exercise of stock
options 1,199 1
Payments on long-term debt (89) (160)
Borrowings on long-term debt - 21
Net cash provided by (used in)
financing activities 1,110 (138)
----- ----
Effect of Exchange Rate Changes on
Cash and Cash Equivalents 295 (257)
--- ----
Net Increase (Decrease) in Cash and
Cash Equivalents 1,575 (4,017)
Cash and Cash Equivalents, Beginning
of Period 51,121 27,655
------ ------
Cash and Cash Equivalents, End of
Period $52,696 $23,638
======= =======
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SOURCE Amtech Systems, Inc.
