Brooks Automation Reports Results of First Quarter of Fiscal 2021, Ended December 31, 2020, and Announces Quarterly Cash Dividend
CHELMSFORD, Mass., Feb. 2, 2021 /PRNewswire/ -- Brooks Automation, Inc. (Nasdaq: BRKS) today reported financial results for the first fiscal quarter of 2021, ended December 31, 2020.
Financial Results Summary
Quarter Ended
Dollars in millions, except per share
data December 31, September 30, December 31, Change vs.
2020 2020 2019 Prior Qtr Prior Year
Revenue $
250 $
246 $
210 1
% 19
%
Semiconductor Solutions $
131 $
138 $
119 (5)
% 11
%
Life Sciences $
118 $
108 $
92 9
% 29
%
Diluted EPS Continuing Operations $
0.36 $
0.39 $
0.18 (7)
% 103
%
Diluted EPS Total $
0.35 $
0.39 $
0.18 (11)
% 98
%
Non-GAAP Diluted EPS Continuing
Operations $
0.47 $
0.47 $
0.23 1
% 108
%
Adjusted EBITDA $
58 $
54 $
32 7
% 81
%
Management Comments
"We are very pleased with the results of our first quarter of 2021 as we continued our trajectory of strong profitable growth," commented Steve Schwartz, president and CEO. "Our life sciences business had another exceptional quarter, driven by both product and services offerings. Semiconductor remains robust and is poised to accelerate in the second quarter given a healthy order backlog and market tailwinds."
Summary of GAAP Results
First Quarter, Fiscal 2021
-- Revenue for the first quarter was $250 million, up 19% year over year,
supported by growth in both Life Sciences and Semiconductor Solutions.
Diluted EPS from continuing operations was $0.36 per share compared to
$0.18 per share in the first quarter of 2020.
-- Life Sciences revenue of $118 million grew 29% year over year.
Year-over-year organic growth was 32%. Life Sciences Products grew 53%
year over year, and Life Sciences Services grew 17%. Life Sciences
Services increased 28%, excluding the effect of the recent exit of the
RUCDR alliance.
-- Semiconductor Solutions revenue was $131 million, an increase of 11%
year over year.
-- GAAP operating income was $31 million, compared to $11 million in the
first quarter of 2020. GAAP operating margin was 12.4%, up 730 basis
points year over year.
Summary of Non-GAAP Results for Continuing Operations
First Quarter, Fiscal 2021
-- Diluted EPS for the first quarter was $0.47, up 108% year over year.
-- Operating income was $44 million, an increase of 99% year over year, and
operating margin was 17.5%, up 710 basis points year over year. Gross
margin of 46.3% was up 470 basis points year over year and was the
primary contributor to the operating margin improvement. Year-over-year
gross margin expansion in both Life Sciences and Semiconductor Solutions
drove this improvement.
-- Life Sciences operating margin was 18.8%, up from 6.5% in the prior
year. The year-over-year improvement was driven by gross margin of
50.2%, up 590 basis points year over year. An additional 640 basis
points improvement came from the leverage of operating expense which
grew only 7% to support the 29% revenue growth. The 590 basis point
year-over-year improvement in Life Sciences gross margin was driven by
the Products business, up 310 basis points, and the Services business,
up 790 basis points. The favorable mix effect of unwinding the RUCDR
alliance agreement drove 210 basis points of the total Life Sciences
business gross margin improvement while 380 basis points of the increase
was due to performance improvement.
-- Semiconductor Solutions operating margin was 16.4%, an increase of 380
basis points from the prior year. Gross margin was 42.8%, up 320 basis
points year over year, primarily driven by growth and favorable mix in
vacuum robots compared to the prior year.
-- Adjusted EBITDA was $58 million, up 81% from the first quarter of 2020
and 7% sequentially.
A reconciliation of non-GAAP measures to the most nearly comparable GAAP measures follows the consolidated balance sheets, statements of operations and statements of cash flows included in this release.
Cash and Liquidity
-- Cash flow from operations was $44 million for the quarter, an increase
of $18 million year over year.
-- The Company ended the first fiscal quarter of 2021 with a total balance
of cash, cash equivalents, restricted cash, and marketable securities of
$323 million. With total debt of $50 million, net cash was $272 million.
Quarterly Cash Dividend
The Company additionally announced that the Board of Directors has reiterated a dividend of $0.10 per share payable on March 26, 2021 to stockholders of record on March 5, 2021. Future dividend declarations, as well as the record and payment dates for such dividends, are subject to the final determination of the Company's Board of Directors.
Guidance for Second Quarter Fiscal 2021
The Company announced revenue and earnings guidance for the second quarter of fiscal 2021. Revenue is expected to be in the range of $267 million to $283 million and non-GAAP diluted earnings per share is expected to be in the range of $0.48 to $0.57. GAAP diluted earnings per share for the second fiscal quarter is expected to be in the range of $0.33 to $0.42
Conference Call and Webcast
Brooks management will webcast its first quarter earnings conference call today at 4:30 p.m. Eastern Time. During the call, Company management will respond to questions concerning, but not limited to, the Company's financial performance, business conditions and industry outlook. Management's responses could contain information that has not been previously disclosed.
The call will be broadcast live over the Internet and, together with presentation materials referenced on the call, will be hosted at the Investor Relations section of Brooks' website at www.brooks.investorroom.com, and will be archived online on this website for convenient on-demand replay. In addition, you may call 800-734-8583 (US & Canada only) or +1-212-231-2904 for international callers to listen to the live webcast.
Regulation G - Use of Non-GAAP financial Measures
The Company supplements its GAAP financial measures with certain non-GAAP financial measures to provide investors a better perspective on the results of business operations, which the Company believes is more comparable to the similar analysis provided by its peers. These measures are not presented in accordance with, nor are they a substitute for, U.S. generally accepted accounting principles, or GAAP. These measures should always be considered in conjunction with appropriate GAAP measures. A reconciliation of non-GAAP measures to the most nearly comparable GAAP measures is included at the end of this release following the consolidated balance sheets, statements of operations and statements of cash flows.
"Safe Harbor Statement" under Section 21E of the Securities Exchange Act of 1934
Some statements in this release are forward-looking statements made under Section 21E of the Securities Exchange Act of 1934. These statements are neither promises nor guarantees but involve risks and uncertainties, both known and unknown, that could cause Brooks' financial and business results to differ materially from our expectations. They are based on the facts known to management at the time they are made. These forward-looking statements include but are not limited to statements about our revenue and earnings expectations, our ability to increase our profitability, our ability to improve or retain our market position, and our ability to deliver financial success in the future. Factors that could cause results to differ from our expectations include the following: the impact of the COVID-19 global pandemic on the markets we serve, including our supply chain, and on the global economy generally, the volatility of the industries the Company serves, particularly the semiconductor industry; our possible inability to meet demand for our products due to difficulties in obtaining components and materials from our suppliers in required quantities and of required quality; the inability of customers to make payments to us when due; the timing and effectiveness of cost reduction and cost control measures; price competition; disputes concerning intellectual property; uncertainties in global political and economic conditions, and other factors and other risks, including those that we have described in our filings with the Securities and Exchange Commission, including but not limited to our Annual Report on Form 10-K, current reports on Form 8-K and our quarterly reports on Form 10-Q. As a result, we can provide no assurance that our future results will not be materially different from those projected. Brooks expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statement to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based. Brooks undertakes no obligation to update the information contained in this press release.
About Brooks Automation
Brooks (Nasdaq: BRKS) is a leading provider of life science sample-based solutions and semiconductor manufacturing solutions worldwide. The Company's Life Sciences business provides a full suite of reliable cold-chain sample management solutions and genomic services across areas such as drug development, clinical research and advanced cell therapies for the industry's top pharmaceutical, biotech, academic and healthcare institutions globally. Brooks Life Sciences' GENEWIZ division is a leading provider of gene sequencing and gene synthesis services. With over 40 years as a partner to the semiconductor manufacturing industry, Brooks is a provider of industry-leading precision vacuum robotics, integrated automation systems and contamination control solutions to the world's leading semiconductor chip makers and equipment manufacturers. Brooks is headquartered in Chelmsford, MA, with operations in North America, Europe and Asia. For more information, visit www.brooks.com.
BROOKS INVESTOR CONTACTS:
Sara Silverman
Director of Investor Relations
Brooks Automation
978.262.2635
sara.silverman@brooks.com
Sherry Dinsmore
Brooks Automation
978.262.4301
sherry.dinsmore@brooks.com
BROOKS AUTOMATION, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except per share data)
Three Months Ended
December 31,
2020 2019
Revenue
Products $
159,616 $
131,862
Services 89,887 78,638
Total revenue 249,503 210,500
Cost of revenue
Products 91,503 79,971
Services 44,872 45,543
Total cost of revenue 136,375 125,514
Gross profit 113,128 84,986
Operating expenses
Research and development 16,083 14,401
Selling, general and
administrative 66,030 59,343
Restructuring charges 87 576
Total operating expenses 82,200 74,320
Operating income 30,928 10,666
Interest income 76 699
Interest expense (556) (737)
Other income (expenses), net 1,329 (417)
Income before income taxes 31,777 10,211
Income tax benefit 4,770 (2,963)
Income from continuing
operations 27,007 13,174
Loss from discontinued
operations, net of tax (979) (117)
Net income $
26,028 $
13,057
Basic net income per share:
---
Income from continuing
operations $
0.35 $
0.18
Loss from discontinued
operations, net of tax (0.01) (0.00)
Basic net income per share $
0.35 $
0.18
Diluted net income per share:
---
Income from continuing
operations $
0.36 $
0.18
Loss from discontinued
operations, net of tax (0.01) (0.00)
Diluted net income per share $
0.35 $
0.18
Weighted average shares
outstanding used in computing
net income per share:
Basic 74,021 72,972
Diluted 74,283 73,645
BROOKS AUTOMATION, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands, except share and per share data)
December 31, September 30,
2020 2020
---
Assets
Current assets
Cash and cash equivalents $
308,517 $
295,649
Marketable securities 55 67
Accounts receivable, net 196,679 188,291
Inventories 123,917 114,834
Prepaid expenses and other current assets 45,988 50,612
Total current assets 675,156 649,453
Property, plant and equipment, net 126,947 117,665
Long-term marketable securities 3,410 3,101
Long-term deferred tax assets 4,765 4,979
Goodwill 512,989 501,536
Intangible assets, net 219,866 218,325
Other assets 71,599 64,066
Total assets $
1,614,732 $
1,559,125
===
Liabilities and Stockholders' Equity
Current liabilities
Current portion of long-term debt $
414 $
827
Accounts payable 67,811 61,758
Deferred revenue 35,661 31,357
Accrued warranty and retrofit costs 8,228 8,201
Accrued compensation and benefits 31,693 43,267
Accrued restructuring costs 106 181
Accrued income taxes payable 15,972 10,094
Accrued expenses and other current liabilities 65,885 55,433
Total current liabilities 225,770 211,118
Long-term debt 49,629 49,588
Long-term tax reserves 19,458 19,168
Long-term deferred tax liabilities 15,132 17,798
Long-term pension liabilities 6,741 6,406
Long-term operating lease liabilities 34,173 31,855
Other long-term liabilities 11,675 9,578
Total liabilities 362,578 345,511
Stockholders' Equity
Preferred stock, $0.01 par value -1,000,000 shares
authorized, no shares issued or outstanding
Common stock, $0.01 par value -125,000,000 shares
authorized, 87,672,132 shares issued and 74,210,263
shares outstanding at December 31, 2020, 87,293,710
shares issued and 73,831,841 shares outstanding at
September 30, 2020 877 873
Additional paid-in capital 1,949,556 1,942,850
Accumulated other comprehensive income 35,145 21,919
Treasury stock at cost - 13,461,869 shares (200,956) (200,956)
Accumulated deficit (532,468) (551,072)
Total stockholders' equity 1,252,154 1,213,614
Total liabilities and stockholders' equity $
1,614,732 $
1,559,125
===
BROOKS AUTOMATION, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(In thousands)
Three Months Ended
December 31,
2020 2019
---
Cash flows from operating activities
Net income $
26,028 $
13,057
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 15,746 16,477
Stock-based compensation 6,710 4,410
Amortization of premium on marketable securities and
deferred financing costs 56 67
Deferred income taxes (4,960) (8,183)
Other gains on disposals of assets 1 126
Adjustment to the gain on divestiture, net of tax 948 319
Changes in operating assets and liabilities, net of
acquisitions:
Accounts receivable (4,504) 1,503
Inventories (6,307) (4,335)
Prepaid expenses and current assets 28,945 6,120
Accounts payable 5,727 5,255
Deferred revenue 3,186 (720)
Accrued warranty and retrofit costs (185) 221
Accrued compensation and tax withholdings (12,307) (5,755)
Accrued restructuring costs (75) (203)
Accrued expenses and current liabilities (15,279) (2,616)
Net cash provided by operating activities 43,730 25,743
Cash flows from investing activities
Purchases of property, plant and equipment (15,227) (9,614)
Purchases of marketable securities (4) (10,742)
Maturities of marketable securities 33,584
Acquisitions, net of cash acquired (15,061)
Net cash (used in) provided by investing activities (30,292) 13,228
Cash flows from financing activities
Principal payments on debt (414) (414)
Payments of finance leases (319) (319)
Common stock dividends paid (7,424) (7,369)
Net cash used in financing activities (8,157) (8,102)
Effects of exchange rate changes on cash and cash
equivalents 11,250 2,808
Net increase in cash and cash equivalents 16,531 33,677
Cash, cash equivalents and restricted cash, beginning of
period 302,526 305,171
Cash and cash equivalents and restricted cash,
end of period $
319,057 $
338,848
===
Reconciliation of cash, cash equivalents, and restricted
cash to the consolidated balance sheets
Cash and cash equivalents $
308,517 $
335,319
Short-term restricted cash included in prepaid expenses
and other current assets 3,571 3,529
Long-term restricted cash included in other assets 6,969
Total cash, cash equivalents and restricted
cash shown in the consolidated statements of
cash flows $
319,057 $
338,848
===
Notes on Non-GAAP Financial Measures:
These financial measures are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. Management adjusted the GAAP results for the impact of amortization of intangible assets, restructuring charges, purchase price accounting adjustments and charges related to M&A to provide investors better perspective on the results of operations which the Company believes is more comparable to the similar analysis provided by its peers. Management also excludes special charges and gains, such as impairment losses, gains and losses from the sale of assets, as well as other gains and charges that are not representative of the normal operations of the business. Management strongly encourages investors to review our financial statements and publicly-filed reports in their entirety and not rely on any single measure.
Quarter Ended
---
December 31, 2020 September 30, 2020 December 31, 2019
per diluted per diluted per diluted
Dollars in thousands, except per share data
$ share
$ share
$ share
Net income from continuing operations $
27,007 $
0.36 $
28,973 $
0.39 $
13,174 $
0.18
Adjustments:
---
Amortization of intangible assets 9,745 0.13 10,442 0.14 10,584 0.14
Restructuring charges 87 0.00 241 0.00 576 0.01
Merger costs 2,991 0.04 19 0.00 195 0.00
Tax adjustments (1) (1,999) (0.03) (800) (0.01) (5,230) (0.07)
Tax effect of adjustments (2,880) (0.04) (4,369) (0.06) (2,662) (0.04)
Non-GAAP adjusted net income from continuing operations $
34,951 $
0.47 $
34,506 $
0.47 $
16,637 $
0.23
Stock based compensation, pre-tax 6,710 0.09 3,969 0.05 4,410 0.06
Tax rate 15 15 15
% % %
Stock-based compensation, net of tax 5,704 0.08 3,374 0.05 3,749 0.05
Non-GAAP adjusted net income excluding stock-based compensation - continuing
operations $
40,655 $
0.55 $
37,880 $
0.51 $
20,386 $
0.28
Shares used in computing non-GAAP diluted net income per share 74,283 74,004 73,645
(1) The Company elected to apply the
tax benefit related to the stock
compensation windfall realized in
the quarters ended December 31,
2020 and 2019 to the non-GAAP
full year tax rate. The Company
elected to exclude a deferred tax
benefit realized in the three
month period ended December 31,
2019 related to the extension of
the 15 percent tax rate incentive
in China.
Quarter Ended
December 31, September 30, December 31,
Dollars in thousands 2020 2020 2019
GAAP net income $
26,028 $
28,973 $
13,057
Adjustments:
---
Less: Loss (income) from
discontinued operations 979 117
Less: Interest income (76) 16 (699)
Add: Interest expense 556 679 737
Add: Income tax benefit 4,770 4,380 (2,963)
Add: Depreciation 6,001 5,295 5,891
Add: Amortization of completed
technology 2,389 2,813 2,674
Add: Amortization of customer
relationships and acquired
intangible assets 7,356 7,629 7,910
Earnings before interest, taxes,
depreciation and amortization $
48,003 $
49,785 $
26,724
Quarter Ended
December 31, September 30, December 31,
Dollars in thousands 2020 2020 2019
Earnings before interest, taxes,
depreciation and amortization $
48,003 $
49,785 $
26,724
Adjustments:
---
Add: Stock-based compensation 6,710 3,969 4,410
Add: Restructuring charges 87 240 576
Add: Merger costs 2,991 19 195
Adjusted earnings before interest,
taxes, depreciation and
amortization $
57,791 $
54,013 $
31,905
Quarter Ended
---
Dollars in thousands December 31, 2020 September 30, 2020 December 31, 2019
GAAP gross profit/ $
113,128 45.3 $
111,969 45.5 $
84,986 40.4
margin percentage
% % %
Adjustments:
---
Amortization of
completed technology 2,389 1.0 2,813 1.1 2,674 1.3
Non-GAAP adjusted $
115,517 46.3 $
114,782 46.6 $
87,660 41.6
gross profit/gross
margin percentage % % %
Brooks Semiconductor Solutions Group
---
Quarter Ended
Dollars in thousands December 31, 2020 September 30, 2020 December 31, 2019
GAAP gross profit/ $
55,789 42.5 $
59,435 43.1 $
46,300 39.0
margin percentage
% % %
Adjustments:
---
Amortization of
completed
technology 384 0.3 736 0.5 732 0.6
Non-GAAP adjusted $
56,173 42.8 $
60,171 43.6 $
47,032 39.6
gross profit/
margin percentage % % %
Brooks Life Sciences Products
Brooks Life Sciences Services
--- ---
Quarter Ended
Quarter Ended
Dollars in thousands December 31, 2020 September 30, 2020 December 31, 2019 December 31, 2020 September 30, 2020 December 31, 2019
GAAP gross profit/ $
20,531 45.1 $
16,701 43.2 $
12,378 41.6 $
36,810 50.7 $
35,832 51.5 $
26,308 42.5
margin percentage
% % % % % %
Adjustments:
---
Amortization of
completed
technology 273 0.6 293 0.8 292 1.0 1,732 2.4 1,784 2.6 1,650 2.7
Non-GAAP adjusted $
20,804 45.7 $
16,994 44.0 $
12,670 42.6 $
38,542 53.1 $
37,616 54.0 $
27,958 45.1
gross profit/
margin percentage % % % % % %
Brooks Life Sciences Total
---
Quarter Ended
Dollars in thousands December 31, 2020 September 30, 2020 December 31, 2019
GAAP gross profit/ $
57,341 48.5 $
52,533 48.5 $
38,686 42.1
margin percentage
% % %
Adjustments:
---
Amortization of
completed
technology 2,005 1.7 2,077 1.9 1,942 2.1
Non-GAAP adjusted $
59,346 50.2 $
54,610 50.5 $
40,628 44.3
gross profit/
margin percentage % % %
Brooks Semiconductor Solutions Group Brooks Life Sciences Products Brooks Life Sciences Services Brooks Life Sciences Total
--- --- --- ---
Quarter Ended
Quarter Ended
Quarter Ended
Quarter Ended
Dec 31, Sept 30, Dec 31, Dec 31, Sept 30, Dec 31, Dec 31, Sept 30, Dec 31, Dec 31, Sept 30, Dec 31,
Dollars in thousands 2020 2020 2019 2020 2020 2019 2020 2020 2019 2020 2020 2019
GAAP operating profit $
21,154 $
27,094 $
14,268 $
7,669 $
4,072 $
69 $
12,579 $
11,353 $
3,963 $
20,248 $
15,425 $
4,032
Adjustments:
---
Amortization of completed
technology 384 736 732 273 293 292 1,732 1,784 1,650 2,005 2,077 1,942
Non-GAAP adjusted operating
profit $
21,538 $
27,830 $
15,000 $
7,942 $
4,365 $
361 $
14,311 $
13,137 $
5,613 $
22,253 $
17,502 $
5,974
Total Segments
Corporate
Total
--- --- ---
Quarter Ended
Quarter Ended
Quarter Ended
Dec 31, Sept 30, Dec 31, Dec 31, Sept 30, Dec 31, Dec 31, Sept 30, Dec 31,
Dollars in thousands 2020 2020 2019 2020 2020 2019 2020 2020 2019
GAAP operating profit (loss) $
41,402 $
42,519 $
18,300 $
(10,474) $
(8,398) $
(7,634) $
30,928 $
34,121 $
10,666
Adjustments:
---
Amortization of completed
technology 2,389 2,813 2,674 2,389 2,813 2,674
Amortization of customer
relationships and acquired
intangible assets 7,356 7,629 7,910 7,356 7,629 7,910
Restructuring charges 87 241 576 87 241 576
Merger costs 2,991 19 195 2,991 19 195
Non-GAAP adjusted operating
profit (loss) $
43,791 $
45,332 $
20,974 $
(40) $
(509) $
1,047 $
43,751 $
44,823 $
22,021
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