Camtek Announces Results for the Third Quarter of 2019
MIGDAL HAEMEK, Israel, Nov. 7, 2019 /PRNewswire/ -- Camtek Ltd. (NASDAQ: CAMT) (TASE: CAMT), today announced its financial results for the quarter ended September 30, 2019.
Highlights of the Third Quarter 2019
-- Revenues were at $32.5 million;
-- GAAP gross margin at 46.9%; Non-GAAP gross margin at 47.1%;
-- GAAP operating income was $4.4 million and non-GAAP operating income was
$5.3 million, representing margins of 13.5% and 16.2%, respectively;
-- GAAP net income of $4.2 million, or $0.11 per diluted share, and
non-GAAP net income of $5.0 million, or $0.13 per diluted share;
-- Operating cash flow of $3.8 million with $83.0 million in cash and
short-term deposits at quarter-end; and
-- Expect fourth quarter revenues at similar levels to that of the third
quarter, with improved profitability.
Management Comment
Rafi Amit Camtek's CEO commented, "Camtek's third quarter results reflect continued solid execution, with revenues in the upper limit of our guidance range despite the current weaker semiconductor market. Our gross margin came in below previous quarters mainly as a result of less favorable product mix in the quarter. We expect an improvement in the gross and operating margins in the fourth quarter."
Continued Mr. Amit, "China has grown to become our largest territory and we expect this to continue into next year. Orders have been for various applications including Advanced Packaging and Front-End Macro inspection, as well as new customers opening facilities and purchasing an initial tool, with the potential for further expansion. Since the beginning of the year we have gained 14 new customers, most of them in China. Furthermore, we have strengthened our position in two key market segments: power devices and CMOS image sensors. During the quarter, we received and installed two multiple machine orders for these segments which are expected to continue growing into 2020."
Concluded Mr. Amit, "Fundamental long-term market drivers remain strong, and Camtek continues to maintain its strong position in the market. Next quarter, we expect revenues at around current levels. This should put us at record revenue level for the year of about $133 million."
Third Quarter 2019 Financial Results
Revenues for the third quarter of 2019 were $32.4 million. This compares to third quarter 2018 revenues of $32.3 million.
Gross profit on a GAAP basis in the quarter totaled $15.2 million (46.9% of revenues), a decline of 6% compared to a gross profit of $16.2 million (50.2% of revenues) in the third quarter of 2018. Gross profit on a non-GAAP basis in the quarter totaled $15.3 million (47.1% of revenues), a decline of 6% compared to a gross profit of $16.2 million (50.4% of revenues) in the third quarter of 2018. The decline in the gross margin is due to less favorable product mix in the third quarter of 2019.
Operating profit on a GAAP basis in the quarter totaled $4.4 million (13.5% of revenues), a decline of 21% compared to an operating income of $5.6 million (17.2% of revenues) in the third quarter of 2018. Operating profit on a non-GAAP basis in the quarter totaled $5.3 million (16.2% of revenues), a decline of 15% compared to $6.2 million (19.2% of revenues) in the third quarter of 2018. The decline in the operating margin is due to the lower gross margin in the third quarter of 2019.
Net income on a GAAP basis in the quarter totaled $4.2 million, or $0.11 per diluted share, a decline of 18% compared to net income of $5.1 million, or $0.14 per diluted share, in the third quarter of 2018. Net income on a non-GAAP basis in the quarter totaled $5.0 million, or $0.13 per diluted share, a decline of 12% compared to a non-GAAP net income of $5.7 million, or $0.16 per diluted share, in the third quarter of 2018.
Cash and cash equivalents, as of September 30, 2019, were $83.0 million compared to $54.9 million as of December 31, 2018 and $85.3 million as of June 30, 2019. During the quarter the Company generated a positive operating cash flow of $3.8 million and paid a cash dividend of $5.7 million.
Conference Call
Camtek will host a conference call today, November 7, 2019, 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 10am Eastern Time
Israel: 03 918 0609 at 5pm Israel Time
International: +972 3 918 0609
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.
A summary presentation of the quarterly results will also be available on Camtek's website.
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 other risks identified in our Annual Report on Form 20-F and other documents filed by the Company with the SEC, that represent our views only as of the date they are made and should not be relied upon as representing our views as of any subsequent date.
This press release provides financial measures that exclude: (i) share based compensation expenses; (ii) certain Chroma transaction expenses; (iii) discontinued operations; and (iv) 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)
September 30, December 31,
---
2019 2018
---
Assets U.S. Dollars (In
thousands)
--- ---
Current assets
Cash and cash equivalents 59,040 54,935
Short-term deposits 24,000
Trade accounts receivable, net 28,590 31,644
Inventories 26,479 30,109
Other current assets 2,316 2,613
---
Total current assets 140,425 119,301
---
Fixed assets, net *18,793 17,117
---
Long term inventory 2,856 2,056
Deferred tax asset 1,201 2,366
Other assets, net 240 231
Intangible assets, net 521 476
---
4,818 5,129
---
Total assets 164,036 141,547
===
Liabilities and shareholders' equity
---
Current liabilities
Trade accounts payable 11,317 15,541
Other current liabilities *19,624 23,179
---
Total current liabilities 30,941 38,720
Long term liabilities
Other long term liabilities *2,375 1,420
---
2,375 1,420
---
Total liabilities 33,316 40,140
---
Commitments and contingencies
Shareholders' equity
Ordinary shares NIS 0.01 par value, 100,000,000
shares authorized at
September 30, 2019 and at December 31, 2018;
40,689,020 issued shares at September 30, 2019
and 38,535,445 at
December 31, 2018;
38,596,644 shares outstanding at
September 30, 2019 and 157 151
36,443,069 at December 31, 2018
Additional paid-in capital 100,352 81,873
Retained earnings 32,109 21,281
---
132,618 103,305
Treasury stock, at cost (2,092,376
as of September 30, 2019 and (1,898) (1,898)
December 31, 2018)
---
Total shareholders' equity 130,720 101,407
---
Total liabilities and shareholders'
equity 164,036 141,547
===
*Includes adjustment in respect of implementation of ASC 842 - Leases
Camtek Ltd.
Consolidated Statements of Operations
---
(in thousands, except share data)
Nine Months ended Three Months Year ended
September 30, ended September
30, December 31,
---
2019 2018 2019 2018 2018
---
U.S. dollars U.S. dollars U.S. dollars
---
90,000
Revenues 100,818 32,470 32,264 123,174
Cost of revenues 51,875 45,921 17,252 16,081 62,378
---
Gross profit 48,943 44,079 15,218 16,183 60,796
---
Research and
development costs 11,891 10,456 4,164 3,501 14,581
Selling, general and
administrative
expenses 19,668 19,792 6,681 7,128 26,182
---
31,559 30,248 10,845 10,629 40,763
Operating income 17,384 13,831 4,373 5,554 20,033
---
Financial income, net 340 491 188 55 728
---
Income from
continuing
operations 17,724 14,322 4,561 5,609 20,761
before income taxes
---
Income tax expense (1,508) (1,364) (398) (516) (2,030)
---
Net income from
continuing
operations 16,216 12,958 4,163 5,093 18,731
===
Discontinued operations *
Income from discontinued
operations
Income before tax
expense 1,257 -
Income tax expense (94) -
Net income from
discontinued
operations 1,163 -
Net income 17,379 12,958 4,163 5,093 18,731
===
*Relates to the earn-out payment received from the sale of the PCB business.
Net income per ordinary share:
Nine months Three months
ended ended Year ended
September 30,
September 30, December 31,
2019 2018 2019 2018 2018
U.S. dollars U.S. dollars U.S. dollars
Basic earnings from
continuing 0.43 0.36 0.11 0.14 0.52
operation
Basic earnings from
discontinued 0.03
operation
Basic net earnings 0.47 0.36 0.11 0.14 0.52
Diluted earnings from
continuing 0.43 0.35 0.11 0.14 0.51
operation
Diluted earnings from
discontinued 0.03
operation
Diluted net earnings 0.46 0.35 0.11 0.14 0.51
Weighted average number of
ordinary shares
outstanding:
Basic 37,286 36,105 38,541 36,300 36,190
Diluted 38,064 36,657 39,307 36,941 36,747
Camtek Ltd.
Reconciliation of GAAP To Non-GAAP results
---
(In thousands, except share data)
Nine Months ended Three Months ended Year ended
September 30, September 30, December 31,
---
2019 2018 2019 2018 2018
---
U.S. dollars U.S. dollars U.S. dollars
---
Reported net income
attributable to 17,379 12,958 4,163 5,093 18,731
Camtek Ltd. on GAAP basis
Share-based compensation 2,068 1,028 818 634 1,682
Chroma transaction
expenses (1) 136 63 -
Attributable to
discontinued operations (1,163) -
Effect of FIT
reorganization (2) 506 506
Non-GAAP net income 18,420 14,492 5,044 5,727 20,919
===
Non -GAAP diluted net income per
share
0.48 0.40 0.13 0.16 0.57
Gross margin on GAAP basis from
continuing operations
48.5% 49.0% 46.9% 50.2% 49.4%
Reported gross profit on
GAAP basis 48,943 44,079 15,218 16,183 60,796
Share-based compensation 207 105 85 62 167
Effect of FIT
reorganization (2) 205 205
Non- GAAP gross margin 49,150 44,389 15,303 16,245 61,168
Non-GAAP gross profit 48.8% 49.3% 47.1% 50.4% 49.7%
===
Reported operating income attributable
to Camtek Ltd. on GAAP basis from
continuing operations
17,384 13,831 4,373 5,554 20,033
Share-based compensation 2,068 1,028 818 634 1,682
Chroma transaction
expenses (1) 136 63 -
Effect of FIT
reorganization (2) 506 506
Non-GAAP operating income 19,588 15,365 5,254 6,188 22,221
===
(1) In the second and third quarters of 2019, certain transaction expenses were incurred in relation to the
technological cooperation agreement with Chroma. These were recorded under operating expenses.
(2) 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.
CAMTEK LTD. INTERNATIONAL INVESTOR RELATIONS
Moshe Eisenberg, CFO
GK Investor Relations
Tel: +972 4 604 8308
Ehud Helft / Gavriel Frohwein
Tel: (US) 1 646 688 3559
Mobile: +972 54 900 7100
camtek@gkir.com
moshee@camtek.com
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SOURCE Camtek Ltd
