Camtek Announces Record Results for the Second Quarter of 2018
MIGDAL HAEMEK, Israel, July 31, 2018 /PRNewswire/ -- Camtek Ltd. (NASDAQ: CAMT); (TASE: CAMT), today announced its financial results for the quarter ended June 30, 2018.
Highlights of the Second Quarter 2018
-- Revenues were a record at $30.5 million, up 34% year-over-year and ahead
of the upper end of the previously-issued guidance range;
-- Revenues for the first half of 2018 are up over 30% from 2017;
-- GAAP operating income was $4.7 million and non-GAAP operating income was
$5.0 million, representing a margins of 15.5% and 16.3%, respectively;
and
-- GAAP net income was $4.3 million and non-GAAP net income was $4.6
million; representing margins of 14.2% and 15.0%, respectively.
Forward Looking Guidance
Third quarter 2018 revenues are expected to grow to $31-32 million, representing a year-over-year increase of approximately 30% for the third quarter and for the first nine months of 2018.
Management Comment
Rafi Amit Camtek's CEO commented, "2018 continues to be a very strong year with revenue growth of approximately 30% and corresponding improvement in profitability. Our strong results are due to our focus on the fastest growing segments of the semiconductors market, particularly advanced packaging. Furthermore, we are successfully leveraging our strong market position in metrology to grow and capture market share in 2D inspection applications as well. Our backlog at record levels and our improved visibility into the end of the year, give us confidence that we will continue revenue growth and associated improvement in margins and profit in the fourth quarter of 2018."
The financial results and the comparison to 2017 in this press release include only those of the continuing operations.
Second Quarter 2018 Financial Results
Revenues for the second quarter of 2018 were $30.5 million. This compares to second quarter 2017 revenues of $22.7 million, a growth of 34%.
Gross profit on a GAAP basis in the quarter totaled $14.9 million (48.9% of revenues), compared to a gross profit of $11.2 million (49.2% of revenues) in the second quarter 2017.
Gross profit on a non-GAAP basis in the quarter totaled $14.9 million (49.0% of revenues), compared to $11.2 million (49.2% of revenues) in the second quarter 2017.
Operating profit on a GAAP basis in the quarter totaled $4.7 million (15.5% of revenues), compared to an operating loss of $11.0 million in the second quarter 2017. The 2017 operating loss was due to a $13 million settlement payment for IP litigation.
Operating profit on a non-GAAP basis in the quarter totaled $5.0 million (16.3% of revenues), compared to $2.1 million (9.2% of revenues) in the second quarter 2017.
Net income on a GAAP basis in the quarter totaled $4.3 million, or $0.12 per diluted share, compared to net loss from continuing operations of $5.7 million, or ($0.16) per diluted share, in the second quarter 2017.
Net income on a non-GAAP basis in the quarter totaled $4.6 million, or $0.13 per diluted share, compared to non-GAAP net income from continuing operations of $2.0 million, or $0.06 per diluted share, in the second quarter 2017.
Cash and cash equivalents, as of June 30, 2018, were $41.2 million compared to $47.2 million as of March 31, 2018. During the quarter the Company paid a $5.1 million dividend. In addition, the Company reported a negative operating cash flow of $1.0 million during the second quarter to support the working capital requirements.
Conference Call
Camtek will host a conference call today, July 31, 2018, at 10:00 am ET.
Rafi Amit, CEO, Moshe Eisenberg, CFO and Ramy Langer, COO will host the call and will be available to answer questions after presenting the results. To participate, please call one of the following telephone numbers a few minutes before the start of the call.
US: 1-888-668-9141 at 10:00 am Eastern
Time
Israel: 03-918-0609 at 5:00 pm Israel Time
International: +972-3-918-0609 at 5:00 pm Israel Time
For those unable to participate, the teleconference will be available for replay on Camtek's website at http://www.camtek.com beginning 24 hours after the call.
ABOUT CAMTEK LTD.
Camtek is a leading manufacturer of metrology and inspection equipment and a provider of software solutions serving the Advanced Packaging, Memory, CMOS Image Sensors, MEMS, RF and other segments in the mid end of the semiconductor industry.
Camtek provides dedicated solutions and crucial yield-enhancement data, enabling manufacturers to improve yield and drive down their production costs.
With eight offices around the world, Camtek has best-in-class sales and customer support organization, providing tailor-made solutions in line with customers' requirements.
This press release is available at http://www.camtek.com
This press release may contain projections or other forward-looking statements regarding future events or the future performance of the Company. These statements are only predictions and may change as time passes. We do not assume any obligation to update that information. Actual events or results may differ materially from those projected, including as a result of changing industry and market trends, reduced demand for our products, the timely development of our new products and their adoption by the market, increased competition in the industry, price reductions as well as due to risks identified in the documents filed by the Company with the SEC.
This press release provides financial measures that exclude: (i) settlement expenses; (ii) changes in valuation allowance on deferred tax assets; (iii) share based compensation expenses, (iv) discontinued operations, and (v) write off costs with regard to the FIT activities, and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these Non-GAAP financial measures provide meaningful supplemental information regarding our performance. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management uses both GAAP and non-GAAP measures when evaluating the business internally and therefore felt it is important to make these non-GAAP adjustments available to investors. A reconciliation between the GAAP and non-GAAP results appears in the tables at the end of this press release.
Consolidated Balance Sheets
---------------------------
(In thousands)
June 30, December 31,
-------- ------------
2018 2017
---- ----
U.S. Dollars (In
thousands)
-----------------
Assets
------
Current assets
Cash and cash equivalents 41,204 43,744
Trade accounts receivable, net 32,278 23,153
Inventories 23,693 21,336
Other current assets 2,769 3,215
----- -----
Total current assets 99,944 91,448
------ ------
Fixed assets, net 15,731 15,503
------ ------
Long-term inventory 1,466 1,383
Deferred tax asset 3,308 4,067
Other assets, net 153 153
Intangible assets, net 480 482
--- ---
5,407 6,085
----- -----
Total assets 121,082 113,036
======= =======
Liabilities and shareholders' equity
------------------------------------
Current liabilities
Trade accounts payable 15,174 10,502
Other current liabilities 16,552 17,395
------ ------
Total current liabilities 31,726 27,897
Long term liabilities
Liability for employee severance
benefits 870 838
--- ---
870 838
--- ---
Total liabilities 32,596 28,735
------ ------
Shareholders' equity
Ordinary shares NIS 0.01 par value, 100,000,000 shares
authorized at June 30,
2018 and at December 31, 2017;
38,277,165 issued shares at June 30, 2018 and 37,924,507 at
December 31,
2017;
36,184,789 shares outstanding at
June 30, 2018 and 35,832,131 at
December 149 149
31, 2017
Additional paid-in capital 79,820 78,437
Retained earnings (losses) 10,415 7,613
------ -----
90,384 86,199
Treasury stock, at cost (2,092,376
as of June 30, 2018 and December
31, 2017) (1,898) (1,898)
------ ------
Total shareholders' equity 88,486 84,301
------ ------
Total liabilities and shareholders'
equity 121,082 113,036
======= =======
Consolidated Statements of Operations
-------------------------------------
(in thousands, except share data)
Six Months ended Three Months Year ended
June 30, ended June 30, December 31,
-------- -------------- ------------
2018 2017 2018 2017 2017
---- ---- ---- ---- ----
U.S. dollars U.S. dollars U.S. dollars
------------ ------------ ------------
Revenues 57,736 43,828 30,462 22,682 93,485
Cost of revenues 29,840 22,384 15,563 11,527 47,966
------ ------ ------ ------ ------
Gross profit 27,896 21,444 14,899 11,155 45,519
------ ------ ------ ------ ------
Research and development
costs 6,955 6,852 3,406 3,413 13,534
Selling, general and
administrative expenses 12,664 11,159 6,775 5,754 22,022
Patent litigation expense - 13,000 - 13,000 13,000
--- ------ --- ------ ------
Total operating expenses 19,619 31,011 10,181 22,167 48,556
Operating income (loss) 8,277 (9,567) 4,718 (11,012) (3,037)
----- ------ ----- ------- ------
Financial income
(expenses), net 436 (209) 146 (56) (150)
--- ---- --- --- ----
Income (loss) from continuing operations
before income taxes 8,713 (9,776) 4,864 (11,068) (3,187)
----- ------ ----- ------- ------
Income tax benefit
(expense) (848) 5,364 (533) 5,404 4,875
---- ----- ---- ----- -----
Income (loss) from
continuing operations 7,865 (4,412) 4,331 (5,664) 1,688
===== ====== ===== ====== =====
Discontinued operation
Income from discontinued operation
Income before tax benefit
(expense) - 4,339 - 1,981 18,302
Income tax benefit
(expense) - (505) - (194) (6,028)
--- ---- --- ---- ------
Income from discontinued
operation - 3,834 - 1,787 12,274
=== ===== === ===== ======
Net income (loss) 7,865 (578) 4,331 (3,877) 13,962
Net income (loss) per ordinary share:
Basic earnings (loss)
from continuing
operation 0.22 (0.12) 0.12 (0.16) 0.05
==== ===== ==== ===== ====
Basic earnings from
discontinued operation - 0.11 - 0.05 0.35
=== ==== === ==== ====
Diluted earnings (loss)
from continuing
operation 0.22 (0.12) 0.12 (0.16) 0.05
==== ===== ==== ===== ====
Diluted earnings from
discontinued
operation - 0.11 - 0.05 0.34
=== ==== === ==== ====
Weighted average number of
ordinary shares outstanding:
Basic 36,050 35,359 36,090 35,369 35,441
====== ====== ====== ====== ======
Diluted 36,512 35,359 36,632 35,369 35,964
====== ====== ====== ====== ======
Camtek Ltd.
Reconciliation of GAAP To Non-GAAP results
------------------------------------------
(In thousands, except share data)
Six Months ended Three Months ended
June Year ended
June 30, 30,
December
31,
----------------- -------------------------- -----------
2018 2017 2018 2017 2017
---- ---- ---- ---- ----
U.S. dollars U.S. dollars U.S. dollars
------------ ------------ ------------
Reported net income (loss)
attributable to
Camtek
Ltd. on GAAP basis 7,865 (578) 4,331 (3,877) 13,962
Effect of FIT
reorganization (1) 506 - - - -
Share-based compensation 395 184 249 92 426
Settlement expense, net of
tax (2) - 12,025 - 12,025 12,025
Realization of deferred
tax assets (3) - (4,495) - (4,495) (4,495)
Attributable to
discontinued operations - (3,832) - (1,787) (12,274)
Non-GAAP net income 8,766 3,304 4,580 1,958 9,644
===== ===== ===== ===== =====
Non -GAAP net income per
share , basic and diluted 0.24 0.09 0.13 0.06 0.27
Gross margin on GAAP basis
from continuing
operations 48.4% 48.9% 48.9% 49.2% 48.7%
Reported gross profit on
GAAP basis 27,896 21,444 14,899 11,155 45,519
Effect of FIT
reorganization (1) 205 - - - -
Share-based compensation 44 19 28 9 44
Non- GAAP gross margin 28,145 21,463 14,927 11,164 45,563
Non-GAAP gross profit 48.8% 48.9% 49.0% 49.2% 48.7%
==== ==== ==== ==== ====
Reported operating income
(loss) attributable to
Camtek Ltd. 8,277 (9,567) 4,718 (11,012) (3,037)
on GAAP basis from continuing
operations
Effect of FIT
reorganization (1) 506 - - - -
Share-based compensation 395 184 249 92 426
Settlement expense (2) - 13,000 - 13,000 13,000
Non-GAAP operating income 9,178 3,617 4,967 2,080 10,389
===== ===== ===== ===== ======
(1) At the end of the first quarter of 2018, the Company ceased its efforts to utilize the remaining inventory and equipment related to FIT development and recorded a one-time write-off in the amount of $0.5 million, consisting of: (1) inventory write-offs of $0.2 million, recorded under the cost of revenue line item; and (2) fixed asset write-offs of $0.3 million recorded under operating expenses.
(2) During the three and the six months ended June 30, 2017, and the year ended December 31, 2017, the Company recorded a provision of $13 million ($12 million net of tax) in conjunction settlement with Rudolph Technologies Inc.
(3) During the three and the six months ended June 30, 2017, and the year ended December 31. 2017, the Company recorded net income of $4.5 million as a result of a decrease in the valuation allowance on deferred tax assets following the evaluation of the realizability of the assets based on projected future earnings.
Camtek Ltd.
P.O. Box 544, Ramat Gabriel Industrial Park
Migdal Ha'Emek 23150, ISRAEL
Tel: +972-(4)-604-8100
Fax: +972-(4)-644-0523
E-mail: info@camtek.com
Web site: http://www.camtek.com
Contacts:
CAMTEK LTD.
Moshe Eisenberg, CFO
Tel: +972-4-604-8308
Mobile: +972-54-900-7100
moshee@camtek.com
INTERNATIONAL INVESTOR RELATIONS
GK Investor Relations
Ehud Helft / Gavriel Frohwein
Tel: (US) +1-646-688-3559
camtek@gkir.com
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SOURCE Camtek Ltd.
