CAMTEK ANNOUNCES RESULTS FOR THE FOURTH QUARTER AND FULL YEAR OF 2023

EXPECTS 30% YoY GROWTH IN THE FIRST QUARTER WITH RECORD REVENUE IN FY 2024

MIGDAL HAEMEK, Israel, Feb. 20, 2024 /PRNewswire/ -- Camtek Ltd. (NASDAQ: CAMT) (TASE: CAMT), today announced its financial results for the fourth quarter and year ended December 31, 2023.

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Highlights of the Fourth Quarter of 2023

    --  Revenues of $88.7 million, an 8% increase year-over-year;
    --  GAAP operating income of $17.2 million; non-GAAP operating income of
        $25.5 million, representing an operating margin of 19.4% and 28.7%
        respectively;
    --  GAAP net income of $20.8 million and non-GAAP net income of $28.2
        million;
    --  Strong operating cash flow of $34.2 million; and
    --  Completion of FRT metrology acquisition.

Highlights of the Full Year 2023

    --  Revenues of $315.4 million, 1.7% below those of last year;
    --  GAAP operating income of $65.4 million; non-GAAP operating income of
        $83.3 million; representing operating margins of 20.7% and 26.4%,
        respectively;
    --  GAAP net income of $78.6 million; non-GAAP net income of $95.7 million;
        and
    --  Operating cash flow of $79.3 million in 2023, which led to a year-end
        total cash, short-term and long-term deposits and marketable securities
        balance of $449 million.

Forward-Looking Expectations

Management expects revenues in the first quarter of 2024 between $93-95 million, representing a mid-point 30% increase over the first quarter of 2023, with further growth leading to a year of record revenue for Camtek.

Management Comment

Rafi Amit, Camtek's CEO commented, "The high demand for high performance computing (HPC) was the main driver behind our record fourth quarter, bringing our full year 2023 revenues to $315 million. We received orders for close to 300 systems in the second half of 2023, which puts us in an excellent position going into 2024. This achievement was primarily due to our strong position with tier-1 customers that manufacture HBM (High Bandwidth Memory) and chiplet devices for AI applications. In addition, we have seen continued strong demand from our OSAT customers, driven by other advanced packaging applications."

Continued Mr. Amit, "During the fourth quarter of 2023 we completed the acquisition of FRT and we are confident that this business will meet our expectations in 2024 and beyond. Looking ahead, we anticipate 2024 to be a record year for Camtek even without the contribution of FRT to our results."

Fourth Quarter 2023 Financial Results

Revenues for the fourth quarter of 2023 were $88.7 million. This compares to fourth quarter 2022 revenues of $82.2 million, a year-over-year growth of 8%.

Gross profit on a GAAP basis in the quarter totaled $39.8 million (44.9% of revenues), compared to a gross profit of $39.9 million (48.6% of revenues) in the fourth quarter of 2022.

Gross profit on a non-GAAP basis in the quarter totaled $43.7 million (49.2% of revenues), up 9% compared to a gross profit of $40.2 million (49.0% of revenues) in the fourth quarter of 2022.

Operating profit on a GAAP basis in the quarter totaled $17.2 million (19.4% of revenues), compared to an operating profit of $20.5 million (24.9% of revenues) in the fourth quarter of 2022.

Operating profit on a non-GAAP basis in the quarter totaled $25.5 million (28.7% of revenues), an increase of 12% compared to $22.8 million (27.8% of revenues) in the fourth quarter of 2022.

Net income on a GAAP basis in the quarter totaled $20.8 million, or $0.42 per diluted share, compared to net income of $21.7 million, or $0.45 per diluted share, in the fourth quarter of 2022.

Net income on a non-GAAP basis in the quarter totaled $28.2 million, or $0.57 per diluted share, compared to a non-GAAP net income of $24.0 million, or $0.50 per diluted share, in the fourth quarter of 2022.

Full Year 2023 Results Summary

Revenues for 2022 were $315.4 million, compared to the $320.9 million reported in 2022, a slight decline of 1.7%.

Gross profit on a GAAP basis totaled $147.6 million (46.8% of revenues), compared to $159.9 million (49.8% of revenues) in 2022.

Gross profit on a non-GAAP basis totaled $152.7 million (48.4% of revenues), compared to $161.1 million (50.2% of revenues) in 2022.

Operating income on a GAAP basis totaled $65.4 million (20.7% of revenues), compared to operating income of $81.5 million (25.4% of revenues) in 2022.

Operating income on a non-GAAP basis totaled $83.3 million (26.4% of revenues), an increase of 20% compared to $92.0 million (28.7% of revenues) in 2022.

Net income on a GAAP basis totaled $78.6 million, or $1.61 per diluted share. This is compared to net income of $79.9 million, or $1.66 per diluted share, in 2022.

Net income on a non-GAAP basis totaled $95.7 million, or $1.96 per diluted share. This is an increase of 27% compared to net income of $90.5 million, or $1.88 per diluted share, in 2022.

Cash and cash equivalents, short-term and long-term deposits, and marketable securities, as of December 31, 2023, were $448.6 million compared to $478.7 million as of December 31, 2022 and $517.1 million as of September 30, 2023. During the fourth quarter, the Company generated an operating cash flow of $34.2 million.

Conference Call

Camtek will host a video conference call/webinar today via Zoom, on Tuesday, February 20, 2024, at 9:00 am ET (16:00 Israel time).

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 in the webinar, please register using the following link, which will provide access to the video call:

https://us06web.zoom.us/webinar/register/WN_bNKd27BfSJmYAcuLiB6DZQ

For those wishing to listen via phone, following registration, the dial in link will be sent. For any problems in registering, please email Camtek's investor relations a few hours in advance of the call.

For those unable to participate, a recording will be available on Camtek's website at http://www.camtek.com within a few 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 high-end inspection and metrology equipment provider for the semiconductor industry. Camtek's systems inspect IC and measure IC features on wafers in various phases of the production process of semiconductor devices, from front-end and mid-end and up to the beginning of assembly (Post Dicing). Camtek's systems inspect and measures wafers for some of the most demanding semiconductor market segments, including Advanced Interconnect Packaging, Heterogenous Integration, Memory and HBM, CMOS Image Sensors, Compound Semiconductors, MEMS, and RF, serving numerous industry's leading global IDMs, OSATs, and foundries.

With manufacturing facilities in Israel and Germany, and eight offices around the world, Camtek provides state of the art solutions in line with customers' requirements.

This press release is available at http://www.camtek.com

This press release contains statements that may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on Camtek's current beliefs, expectations and assumptions about its business and industry, all of which may change. Forward-looking statements can be identified by the use of words including "believe," "anticipate," "should," "intend," "plan," "will," "may," "expect," "estimate," "project," "positioned," "strategy," and similar expressions that are intended to identify forward-looking statements, including statements relating to the compound semiconductors market and our position in this market and the anticipated timing of delivery of the systems. These forward-looking statements involve known and unknown risks and uncertainties that may cause the actual results, performance or achievements of Camtek to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that may cause our actual results to differ materially from those contained in the forward-looking statements include, but are not limited to the effects of the evolving nature of the war situation in Israel, including in Gaza with the Hamas and in Lebanon with the Hezbollah and the related evolving regional conflict, including without limitation, the Houti attacks on marine vessels; the impact of war in Ukraine, rising inflation, rising interest rates, volatile exchange rates and commodities' prices, ; our dependency upon the semiconductor industry and the risk that unfavorable economic conditions or low capital expenditures may negatively impact our operating results; anticipated trends and impacts related to industry component and substrate shortages and other supply chain challenges; the future purchase, use, and availability of components supplied by third parties; impurities and other disruptions to our customers' operations, which could lower production yields or interrupt manufacturing, and could result in the cancellation or delay of purchase of our products; formal or informal imposition by countries of new or revised export and/or import and doing-business regulations or sanctions, including but not limited to changes in U.S. trade policies, changes or uncertainty related to the U.S. government entity list and changes in the ability to sell products incorporating U.S originated technology, which can be made without prior notice, and our ability to effectively address such global trade issues and changes; the risks relating to the concentration of a significant portion of our business in certain countries in the Asia Pacific Region, particularly China (which is our largest territory), Taiwan and Korea, some of which might be subject to the trade restrictions referred to above or involved in trade wars with countries which might impose such trade restrictions; changing industry and market trends; reduced demand for our products; potential adverse reactions or changes to business relationships resulting from the completion of the transaction with FRT, and ongoing or potential litigations or disputes, incidental to the conduct of FRT's business and other risks related to the integration of FRT's business into Camtek business; and those other factors discussed in our Annual Report on Form 20-F and other documents filed by the Company with the SEC as well as other documents that may be subsequently filed by Camtek from time to time with the SEC. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Camtek does not assume any obligation to update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release unless required by law.

While we believe that we have a reasonable basis for each forward-looking statement contained in this press release, we caution you that these statements are based on a combination of facts and factors currently known by us and our projections of the future, about which we cannot be certain. In addition, any forward-looking statements represent Camtek's views only as of the date of this press release and should not be relied upon as representing its views as of any subsequent date. Camtek does not assume any obligation to update any forward-looking statements unless required by law.

This press release provides financial measures that exclude: (i) share based compensation expenses; and (ii) acquisition related expenses, 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. The results reported in this press-release are preliminary unaudited results, and investors should be aware of possible discrepancies between these results and the audited results to be reported, due to various factors.


                                                                                                      
     CAMTEK LTD and its subsidiaries



       
              Consolidated Balance Sheets



       
              (In thousands)


                                                                                                                                        December 31,          December 31,


                                                                                                                                  2023                   2022


                                                                                                                                        U.S. Dollars



       
              
                Assets

    ---




       
              Current assets



       Cash and cash equivalents                                                                                             119,968                148,156



       Short-term deposits                                                                                                   215,250                251,500



       Marketable securities                                                                                                  18,816



       Trade accounts receivable, net                                                                                         87,300                 80,611



       Inventories                                                                                                            85,905                 65,541



       Other current assets                                                                                                   19,548                 11,156



       Total current assets                                                                                                  546,787                556,964







       Long-term deposits                                                                                                     21,000                 79,000



       Marketable securities                                                                                                  73,576



       Long-term inventory                                                                                                     9,023                  5,357



       Deferred tax asset, net                                                                                                 2,642                  1,004



       Other assets, net                                                                                                       1,370                  1,024



       Property, plant and equipment, net                                                                                     41,987                 33,141



       Intangible assets, net                                                                                                 16,937                    597



       Goodwill                                                                                                               74,345



           Total non- current assets                                                                                         240,880                120,123



       
              Total assets                                                                                               787,667                677,087





       
              
                Liabilities and shareholders' equity

    ---


       
              Current liabilities



       Trade accounts payable                                                                                                  42,187                 31,667



       Other current liabilities                                                                                               54,487                 56,833



       Total current liabilities                                                                                               96,674                 88,500





       
              Long-term liabilities



       Deferred tax liabilities, net                                                                                            7,541



       Other long-term liabilities                                                                                             10,473                  8,748



       Convertible notes                                                                                                      196,831                195,737



           Total long-term liabilities                                                                                        214,845                204,485



       Total liabilities                                                                                                      311,519                292,985





       
              Commitments and contingencies



       
              Shareholders' equity



       Ordinary shares NIS 0.01 par value, 100,000,000 shares authorized at


       December 31, 2023 and at December 31, 2022;



       46
            ,993,998
             
            issued shares at December 31, 2023 and 46,505,318
     
     at


       December 31, 2022;



       44
            ,901,622
             
            shares outstanding at December 31, 2023


       and 44,412,942
             
            at December 31, 2022                                                                      176                    175



       Additional paid-in capital                                                                                             200,389                187,105



       Accumulated other comprehensive income                                                                                     129



       Retained earnings                                                                                                      277,352                198,720


                                                                                                                               478,046                386,000



       Treasury stock, at cost (2,092,376 as of December 31, 2023 and


       December 31, 2022)                                                                                                      (1,898)               (1,898)



       Total shareholders' equity                                                                                             476,148                384,102



       
              Total liabilities and shareholders' equity                                                                  787,667                677,087


                                                                                       CAMTEK LTD. and its
                                                                                             subsidiaries



     
                Consolidated Statements of Income



     
                (in thousands, except share data)


                                                                   Year ended December                      Three Months ended December
                                                                    31,                               31,


                                                        2023     2022               2023               2022


                                                                       U.S. dollars                                       U.S. dollars





     
                Revenues                          315,375  320,909             88,690             82,175



     Cost of revenues                               167,742  161,053             48,902             42,229





     
                Gross profit                      147,633  159,856             39,788             39,946







     Research and development costs                  31,470   28,859              8,042              6,684



     Selling, general and administrative expense     50,751   49,499             14,527             12,801


                                                      82,221   78,358             22,569             19,485







     
                Operating income                   65,412   81,498             17,219             20,461





     Financial income, net                           22,218    6,690              5,682              3,801





     
                Income before income taxes         87,630   88,188             22,901             24,262





     Income taxes expense                           (8,998) (8,239)           (2,111)           (2,589)





     
                Net income                         78,632   79,949             20,790             21,673


        Net income per ordinary share:


                                                  Year ended December                Three Months ended December
                                                   31,                  31,


                                         2023   2022               2023    2022


                                                  U.S. dollars                U.S. dollars







     
     Basic net earnings               1.76   1.81               0.46    0.49







     
     Diluted net earnings             1.61   1.66               0.42    0.45





     
     Weighted average number of


     
     ordinary shares outstanding:





     
     Basic                          44,725 44,158             44,882  44,397





     
     Diluted                        48,863 48,229             49,149  48,332



     
                Reconciliation of GAAP To Non-GAAP results



     
                (In thousands, except share data)


                                                                           Year ended December                  Three Months ended December
                                                                            31,                    31,


                                                                 2023    2022               2023      2022


                                                                           U.S. dollars                  U.S. dollars





     
                Reported net income attributable


     
                to Camtek Ltd. on GAAP basis                78,632  79,949             20,790    21,673



     Acquisition of FRT related expenses (1)                   4,550                     4,550



     Share-based compensation                                 12,525  10,523              2,868     2,371





     
                Non-GAAP net income                         95,707  90,472             28,208    24,044





     
                Non-GAAP net income per diluted share         1.96    1.88               0.57      0.50





     
                Gross margin on GAAP basis                   46.8%  49.8%             44.9%    48.6%


     
                Reported gross profit on GAAP basis        147,633 159,856             39,788    39,946





     Acquisition of FRT related expenses (1)                   3,492                     3,492



     Share-based compensation                                  1,591   1,217                395       295



     
                Non-GAAP gross margin                       48.4 % 50.2 %            49.2 %   49.0 %



     
                Non-GAAP gross profit                      152,716 161,073             43,675    40,241





     
                Reported operating income (loss)


     
                attributable to Camtek Ltd. on GAAP


     
                basis                                       65,412  81,498             17,219    20,461



     Acquisition of FRT related expenses (1)                   5,406                     5,406



     Share-based compensation                                 12,525  10,523              2,868     2,371



     
                Non-GAAP operating income                   83,343  92,021             25,493    22,832

(1) During the twelve months and three months ended December 31, 2024, the Company recorded acquisition expenses of $4.5 million for both periods, consisting of: (1) inventory written-up to fair value in purchase accounting charges of $2.2 million, for both periods. This amount recorded under cost of revenues line item. (2) $0.4 million amortization of intangible assets acquired recorded under cost of revenues line item. (3) Inventory write-off of $0.9 million recorded under costs of revenues line item. (4) $0.2 million amortization of intangible assets acquired recorded under sales and marketing expenses line item. (5) Acquisition expenses of $1.7 million recorded under general and administrative expenses line item. (6) $0.9 million reversal of tax provision related to the above adjustment, recorded under the tax expense line item.

CAMTEK LTD.
Moshe Eisenberg, CFO
Tel: +972 4 604 8308
Mobile: +972 54 900 7100
moshee@camtek.com

INTERNATIONAL INVESTOR RELATIONS
EK Global Investor Relations
Ehud Helft
Tel: (US) 1 212 378 8040
camtek@ekgir.com

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SOURCE Camtek Ltd.