| [August 10, 2017] |
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Ichor Holdings, Ltd. Announces Second Quarter 2017 Financial Results
Ichor Holdings, Ltd. (NASDAQ:ICHR), a leader in the design, engineering,
and manufacturing of critical fluid and gas delivery subsystems for
semiconductor capital equipment, today announced financial results for
the second quarter ended June 30, 2017 and guidance for the third
quarter of 2017.
Highlights for the second quarter of 2017 and guidance for the third
quarter of 2017 are as follows:
-
Revenue of $159.7 million
-
U.S. GAAP net income from continuing operations of $10.5 million and
diluted earnings per share from continuing operations attributable to
ordinary shareholders ("diluted EPS") of $0.40
-
Non-GAAP adjusted net income from continuing operations of
$15.5 million and non-GAAP adjusted diluted EPS of $0.60
-
Third quarter revenue guidance of $160-$170 million, inclusive of its
previously announced acquisition of Cal-Weld, Inc. ("Cal-Weld").
Cal-Weld is expected to generate revenue of $15-$20 million in the
last two months of the third quarter, during which Ichor will own
Cal-Weld
"Ichor had another record quarter, with increased demand across all
product lines," said Tom Rohrs, Ichor's Chairman and CEO. "Our focus on
capacity earlier in the year enabled us to meet this level of demand.
Subsequent to the quarter-end, we announced the acquisition of Cal-Weld,
a leading supplier of metal components. This acquisition is accretive to
non-GAAP gross margin and diluted EPS from day one and further cements
our position as a key supplier to the semiconductor capital equipment
OEMs."
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Quarter Ended
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Quarter Ended
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June 30,
2017
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March 31,
2017
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Change
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June 30,
2017
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June 24,
2016
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Change
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(in thousands, except per share amounts and percentages)
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U.S. GAAP Financial Results:
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Net sales
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$
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159,733
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$
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148,704
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+ 7
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%
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$
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159,733
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$
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95,365
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+ 67
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%
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Gross profit percent
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14.7
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%
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16.1
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%
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- 140 bps
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14.7
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%
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15.9
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%
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- 120 bps
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Operating margin percent
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7.4
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%
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9.2
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%
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- 180 bps
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7.4
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%
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5.1
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%
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+ 230 bps
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Net income from continuing operations
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$
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10,470
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$
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12,952
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- 19
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%
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$
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10,470
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$
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3,275
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+ 220
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%
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Diluted EPS
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$
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0.40
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$
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0.51
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- 22
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%
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$
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0.40
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$
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0.06
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n/m (1)
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Quarter Ended
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Quarter Ended
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June 30,
2017
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March 31,
2017
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Change
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June 30,
2017
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June 24,
2016
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Change
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(in thousands, except per share amounts and percentages)
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Non-GAAP Financial Results:
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Net sales
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$
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159,733
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$
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148,704
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+ 7
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%
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$
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159,733
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$
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95,365
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+ 67
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%
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Gross profit percent
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15.8
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%
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16.2
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%
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- 40 bps
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15.8
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%
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15.9
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%
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- 10 bps
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Operating margin percent
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10.5
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%
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10.5
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%
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- 0 bps
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10.5
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%
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9.0
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%
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+ 150 bps
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Adjusted net income from continuing operations
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$
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15,528
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$
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14,567
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+ 7
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%
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$
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15,528
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$
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6,956
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+ 123
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%
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Diluted EPS
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$
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0.60
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$
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0.57
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+ 5
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%
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$
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0.60
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$
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0.29 (2
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)
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+ 107
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%
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(1)
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Comparing second quarter 2017 diluted EPS to second quarter 2016 is
not meaningful, as during 2016 (through our December 2016 initial
public offering ("IPO")), EPS was calculated using the two-class
method, required for participating securities. See the table,
Diluted Earnings per Share from Continuing Operations Attributable
to Common Shareholders, attached to the end of this press release
for a calculation of EPS under the two-class method.
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(2)
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For the second quarter of 2016, assumes the IPO shares sold, the
conversion of preferred shares into ordinary shares, and vesting of
restricted shares and options in connection with our December 2016
IPO occurred at the beginning of the measurement period, for
comparability between periods. No adjustment is needed to diluted
shares outstanding for the second and first quarters of 2017.
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U.S. GAAP Financial Results Overview
For the second quarter of 2017, revenue was $159.7 million, net income
from continuing operations was $10.5 million, and diluted EPS was $0.40.
This compares to revenue of $148.7 million and $95.4 million, net income
from continuing operations of $13.0 million and $3.3 million, and
diluted EPS of $0.51 and $0.06, for the first quarter of 2017 and second
quarter of 2016, respectively.
Non-GAAP Financial Results Overview
For the second quarter of 2017, non-GAAP adjusted net income from
continuing operations was $15.5 million and non-GAAP adjusted diluted
EPS was $0.60. This compares to non-GAAP adjusted net income from
continuing operations of $14.6 million and $7.0 million, and non-GAAP
adjusted diluted EPS of $0.57 and $0.29, for the first quarter of 2017
and second quarter of 2016, respectively.
Third Quarter 2017 Financial Outlook
For the third quarter of 2017, Ichor expects revenue and non-GAAP
adjusted diluted EPS to be in the range of $160-$170 million and
$0.59-$0.65, respectively, which is inclusive of the Cal-Weld
acquisition. We expect third quarter revenue and non-GAAP adjusted
diluted EPS related to the Cal-Weld acquisition to be $15-$20 million
and $0.07-$0.10, respectively, in the last two months of the third
quarter, during which Ichor will own Cal-Weld.
This outlook for non-GAAP adjusted diluted EPS excludes known charges
related to amortization of intangible assets and share-based
compensation expense, but does not reflect any items that are unknown at
this time, such as any additional charges related to acquisitions or
other non-operational or unusual items, as well as other tax related
items, which we are not able to predict without unreasonable efforts due
to their inherent uncertainty.
Balance Sheet and Cash Flow Results
At June 30, 2017, Ichor had cash and restricted cash of $66.8 million,
compared to cash and restricted cash of $52.6 million at
December 30, 2016. The increase in cash was primarily due to
$7.5 million of net cash provided by operating activities, $7.3 million
of proceeds from the exercise of the underwriters' over-allotment option
in January 2017 in connection with our IPO, and $2.2 million of proceeds
from the exercise of stock options by certain employees of the Company,
partially offset by net cash used in investing activities of
$2.8 million. Our operating cash flows of $7.5 million for the six
months ended June 30, 2017 was due to net income of $22.7 million and
non-cash charges of $5.9 million, partially offset by a net increase of
$21.1 million in our net operating assets and liabilities.
We use a 52 or 53 week fiscal year ending on the last Friday in
December. The three months ended June 30, 2017, March 31, 2017, and
June 24, 2016 were 13 weeks. References to the second quarter of 2017,
first quarter of 2017, and second quarter of 2016 relate to the three
months ended June 30, 2017, March 31, 2017, and June 24, 2016,
respectively.
Use of Non-GAAP Financial Results
In addition to U.S. GAAP results, this press release also contains
non-GAAP financial results, including non-GAAP adjusted net income from
continuing operations and non-GAAP adjusted diluted EPS. Non-GAAP
adjusted net income from continuing operations is defined as: net income
from continuing operations; excluding amortization of intangible assets,
share-based compensation expense, and other non-recurring expenses; tax
adjustments related to those non-GAAP adjustments; the tax benefit
associated with the acquisition of Ajax; and certain other non-recurring
charges. Non-GAAP adjusted diluted EPS is defined as non-GAAP adjusted
net income from continuing operations divided by adjusted diluted
ordinary shares, which assumes the IPO shares sold, the conversion of
preferred shares into ordinary shares, and vesting of restricted shares
and options in connection with the IPO occurred at the beginning of the
measurement period.
Management uses non-GAAP adjusted net income from continuing operations,
and non-GAAP adjusted diluted EPS to evaluate Ichor's operating and
financial results. Ichor believes the presentation of non-GAAP results
is useful to investors for analyzing business trends and comparing
performance to prior periods, along with enhancing investors' ability to
view Ichor's results from management's perspective. A table presenting
the reconciliation of non-GAAP results to U.S. GAAP results is included
at the end of this press release.
Conference Call
Ichor will conduct a conference call to discuss its second quarter 2017
results and business outlook on August 10, 2017 at 1:30 p.m. PT.
To listen to the conference call via the Internet, please visit the
investor relations section of Ichor's Web site at ir.ichorsystems.com.
To listen to the conference call via telephone, please call 844-395-9251
(domestic) or 478-219-0504 (international), conference ID: 58939218.
A taped replay of the webcast will be available shortly after the call
on Ichor's website or by calling 855-859-2056 (domestic) or 404-537-3406
(international), conference ID: 58939218.
About Ichor
Ichor is a leader in the design, engineering and manufacturing of
critical fluid delivery subsystems for semiconductor capital equipment.
Our primary offerings include gas and chemical delivery subsystems,
collectively known as fluid delivery subsystems, which are key elements
of the process tools used in the manufacturing of semiconductor devices.
Our gas delivery subsystems deliver, monitor and control precise
quantities of the specialized gases used in semiconductor manufacturing
processes such as etch and deposition. Our chemical delivery subsystems
precisely blend and dispense the reactive liquid chemistries used in
semiconductor manufacturing processes such as electroplating and
cleaning. We also manufacture certain components for internal use in
fluid delivery systems and for direct sales to our customers. This
vertically integrated portion of our business is primarily focused on
metal and plastic parts that are used in gas and chemical systems,
respectively. For more information, please visit Ichor's website at: www.ichorsystems.com.
Safe Harbor Statement
Certain statements in this release are "forward-looking statements" made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Words such as "guidance," "expects,"
"intends," "projects," "plans," "believes," "estimates," "targets,"
"anticipates," and similar expressions are used to identify these
forward-looking statements. Examples of forward-looking statements
include, but are not limited to, statements regarding expected revenue
and non-GAAP adjusted diluted EPS, as well as any other statement that
does not directly relate to any historical or current fact.
Forward-looking statements are based on current expectations and
assumptions, which may not prove to be accurate. These statements are
not guarantees and are subject to risks, uncertainties and changes in
circumstances that are difficult to predict. Many factors could cause
actual results to differ materially and adversely from these
forward-looking statements, including: (1) the integration of Cal-Weld
with Ichor, including the ability to retain customers, suppliers and key
employees, (2) dependence on expenditures by manufacturers and cyclical
downturns in the semiconductor capital equipment industry, (3) reliance
on a very small number of original equipment manufacturers for a
significant portion of sales, (4) negotiating leverage held by our
customers, (5) competitiveness and rapid evolution of the industries in
which we participate, (6) risks associated with weakness in the global
economy and geopolitical instability, (7) keeping pace with developments
in the industries we serve and with technological innovation generally,
(8) designing, developing and introducing new products that are accepted
by original equipment manufacturers in order to retain our existing
customers and obtain new customers, (9) managing our manufacturing and
procurement process effectively, (10) defects in our products that could
damage our reputation, decrease market acceptance and result in
potentially costly litigation, and (11) dependence on a limited number
of suppliers. Additional information concerning these and other factors
can be found in Ichor's filings with the Securities and Exchange
Commission, including other risks, relevant factors and uncertainties
identified in the "Risk Factors" section of Ichor's Annual Report on
Form 10-K or subsequent filings with the Securities and Exchange
Commission. We undertake no obligation to update publicly or revise any
forward-looking statements contained herein to reflect future events or
developments, except as required by law.
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ICHOR HOLDINGS, LTD.
|
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Consolidated Balance Sheets
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(in thousands, except share and per share data)
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(unaudited)
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June 30,
2017
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December 30,
2016
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Assets
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Current assets:
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Cash
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$
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65,044
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$
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50,854
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Restricted cash
|
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|
1,794
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|
1,794
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Accounts receivable, net
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39,818
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|
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26,401
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Inventories
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96,995
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|
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70,881
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Prepaid expenses and other current assets
|
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4,857
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|
|
|
7,061
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Current assets from discontinued operations
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|
35
|
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|
|
99
|
|
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Total current assets
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208,543
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|
|
|
157,090
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Property and equipment, net
|
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14,895
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|
|
12,018
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Other noncurrent assets
|
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|
1,199
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|
|
|
3,574
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Deferred tax assets
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|
|
733
|
|
|
|
570
|
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|
Intangible assets, net
|
|
|
28,548
|
|
|
|
32,146
|
|
|
Goodwill
|
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|
77,071
|
|
|
|
77,093
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Total assets
|
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$
|
330,989
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|
|
$
|
282,491
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|
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Liabilities and Shareholders' Equity
|
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Current liabilities:
|
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|
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Accounts payable
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$
|
101,493
|
|
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$
|
88,531
|
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Accrued liabilities
|
|
|
6,479
|
|
|
|
6,554
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|
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Other current liabilities
|
|
|
7,476
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|
|
|
5,421
|
|
|
Current liabilities from discontinued operations
|
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|
776
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|
|
564
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Total current liabilities
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|
116,224
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|
|
101,070
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Long-term debt, net of current portion
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38,208
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37,944
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Deferred tax liabilities
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|
462
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|
|
|
606
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Other non-current liabilities
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|
1,327
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|
|
|
1,173
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Non-current liabilities from discontinued operations
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|
30
|
|
|
|
39
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Total liabilities
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156,251
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|
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140,832
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Shareholders' equity
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|
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Preferred shares ($0.0001 par value; 20,000,000 shares authorized;
no shares issued and outstanding)
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-
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-
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Ordinary shares ($0.0001 par value; 200,000,000 shares authorized;
25,056,188 and 23,857,381 shares issued and outstanding,
respectively)
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3
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|
|
2
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Additional paid in capital
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206,427
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|
|
|
196,049
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Accumulated deficit
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(31,692
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)
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|
(54,392
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)
|
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Total shareholders' equity
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|
174,738
|
|
|
|
141,659
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Total liabilities and shareholders' equity
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$
|
330,989
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|
|
$
|
282,491
|
|
|
|
|
|
|
|
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ICHOR HOLDINGS, LTD.
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Consolidated Statement of Operations
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(in thousands, except share and per share data)
|
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(unaudited)
|
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|
|
|
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|
|
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|
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Three Months Ended
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Six Months Ended
|
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|
|
|
June 30,
2017
|
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|
March 31,
2017
|
|
|
June 24,
2016
|
|
|
June 30,
2017
|
|
|
June 24,
2016
|
|
|
Net sales
|
|
$
|
159,733
|
|
|
$
|
148,704
|
|
|
$
|
95,365
|
|
|
$
|
308,437
|
|
|
$
|
168,652
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|
|
Cost of sales
|
|
|
136,227
|
|
|
|
124,689
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|
|
|
80,185
|
|
|
|
260,916
|
|
|
|
141,547
|
|
|
Gross profit
|
|
|
23,506
|
|
|
|
24,015
|
|
|
|
15,180
|
|
|
|
47,521
|
|
|
|
27,105
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
1,950
|
|
|
|
1,744
|
|
|
|
1,290
|
|
|
|
3,694
|
|
|
|
2,665
|
|
|
Selling, general, and administrative
|
|
|
7,984
|
|
|
|
6,858
|
|
|
|
7,183
|
|
|
|
14,842
|
|
|
|
13,547
|
|
|
Amortization of intangible assets
|
|
|
1,803
|
|
|
|
1,795
|
|
|
|
1,803
|
|
|
|
3,598
|
|
|
|
3,406
|
|
|
Total operating expenses
|
|
|
11,737
|
|
|
|
10,397
|
|
|
|
10,276
|
|
|
|
22,134
|
|
|
|
19,618
|
|
|
Operating income
|
|
|
11,769
|
|
|
|
13,618
|
|
|
|
4,904
|
|
|
|
25,387
|
|
|
|
7,487
|
|
|
Interest expense, net
|
|
|
675
|
|
|
|
690
|
|
|
|
1,160
|
|
|
|
1,365
|
|
|
|
2,062
|
|
|
Other expense (income), net
|
|
|
151
|
|
|
|
(549
|
)
|
|
|
244
|
|
|
|
(398
|
)
|
|
|
(143
|
)
|
|
Income from continuing operations before income taxes
|
|
|
10,943
|
|
|
|
13,477
|
|
|
|
3,500
|
|
|
|
24,420
|
|
|
|
5,568
|
|
|
Income tax expense from continuing operations
|
|
|
473
|
|
|
|
525
|
|
|
|
225
|
|
|
|
998
|
|
|
|
461
|
|
|
Net income from continuing operations
|
|
|
10,470
|
|
|
|
12,952
|
|
|
|
3,275
|
|
|
|
23,422
|
|
|
|
5,107
|
|
|
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations before taxes
|
|
|
(610
|
)
|
|
|
(111
|
)
|
|
|
(2,305
|
)
|
|
|
(721
|
)
|
|
|
(4,029
|
)
|
|
Income tax expense from discontinued operations
|
|
|
-
|
|
|
|
1
|
|
|
|
2
|
|
|
|
1
|
|
|
|
3
|
|
|
Net loss from discontinued operations
|
|
|
(610
|
)
|
|
|
(112
|
)
|
|
|
(2,307
|
)
|
|
|
(722
|
)
|
|
|
(4,032
|
)
|
|
Net income
|
|
|
9,860
|
|
|
|
12,840
|
|
|
|
968
|
|
|
|
22,700
|
|
|
|
1,075
|
|
|
Less: Undistributed earnings attributable to preferred shareholders
|
|
|
-
|
|
|
|
-
|
|
|
|
(963
|
)
|
|
|
-
|
|
|
|
(1,070
|
)
|
|
Net income attributable to ordinary shareholders
|
|
$
|
9,860
|
|
|
$
|
12,840
|
|
|
$
|
5
|
|
|
$
|
22,700
|
|
|
$
|
5
|
|
|
Net income per share from continuing operations attributable to
ordinary shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.42
|
|
|
$
|
0.53
|
|
|
$
|
0.19
|
|
|
$
|
0.95
|
|
|
$
|
0.29
|
|
|
Diluted
|
|
$
|
0.40
|
|
|
$
|
0.51
|
|
|
$
|
0.06
|
|
|
$
|
0.91
|
|
|
$
|
0.08
|
|
|
Net income per share attributable to ordinary shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.40
|
|
|
$
|
0.52
|
|
|
$
|
0.06
|
|
|
$
|
0.92
|
|
|
$
|
0.07
|
|
|
Diluted
|
|
$
|
0.38
|
|
|
$
|
0.50
|
|
|
$
|
0.02
|
|
|
$
|
0.88
|
|
|
$
|
0.02
|
|
|
Shares used to compute net income from continuing operations per
share attributable to ordinary shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
24,848,365
|
|
|
|
24,654,415
|
|
|
|
85,589
|
|
|
|
24,751,390
|
|
|
|
75,631
|
|
|
Diluted
|
|
|
26,063,527
|
|
|
|
25,640,089
|
|
|
|
277,554
|
|
|
|
25,868,403
|
|
|
|
285,066
|
|
|
Shares used to compute net income per share attributable to ordinary
shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
24,848,365
|
|
|
|
24,654,415
|
|
|
|
85,589
|
|
|
|
24,751,390
|
|
|
|
75,631
|
|
|
Diluted
|
|
|
26,063,527
|
|
|
|
25,640,089
|
|
|
|
277,554
|
|
|
|
25,868,403
|
|
|
|
285,066
|
|
|
|
|
|
|
|
ICHOR HOLDINGS, LTD.
|
|
Consolidated Statements of Cash Flows
|
|
(in thousands)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
June 30,
2017
|
|
|
June 24,
2016
|
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
22,700
|
|
|
$
|
1,075
|
|
|
Adjustments to reconcile net income to net cash used in operating
activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
5,185
|
|
|
|
4,621
|
|
|
Gain on sale of investments and settlement of note receivable
|
|
|
(241
|
)
|
|
|
-
|
|
|
Share-based compensation
|
|
|
913
|
|
|
|
972
|
|
|
Deferred income taxes
|
|
|
(224
|
)
|
|
|
(175
|
)
|
|
Amortization of debt issuance costs
|
|
|
264
|
|
|
|
263
|
|
|
Changes in operating assets and liabilities, net of assets acquired:
|
|
|
|
|
|
|
|
|
|
Accounts receivable, net
|
|
|
(13,417
|
)
|
|
|
(10,732
|
)
|
|
Inventories
|
|
|
(26,114
|
)
|
|
|
1,288
|
|
|
Prepaid expenses and other assets
|
|
|
2,462
|
|
|
|
(1,260
|
)
|
|
Accounts payable
|
|
|
13,592
|
|
|
|
9,320
|
|
|
Accrued liabilities
|
|
|
197
|
|
|
|
1,116
|
|
|
Other liabilities
|
|
|
2,191
|
|
|
|
(2,578
|
)
|
|
Net cash provided by operating activities
|
|
|
7,508
|
|
|
|
3,910
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
(5,214
|
)
|
|
|
(804
|
)
|
|
Cash paid for acquisitions, net of cash acquired
|
|
|
-
|
|
|
|
(17,406
|
)
|
|
Proceeds from sale of intangible assets
|
|
|
-
|
|
|
|
230
|
|
|
Proceeds from sale of property, plant, and equipment
|
|
|
-
|
|
|
|
243
|
|
|
Proceeds from sale of investments and settlement note receivable
|
|
|
2,430
|
|
|
|
-
|
|
|
Net cash used in investing activities
|
|
|
(2,784
|
)
|
|
|
(17,737
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
Issuance of ordinary shares, net of fees
|
|
|
7,278
|
|
|
|
-
|
|
|
Proceeds from exercise of stock options
|
|
|
2,188
|
|
|
|
-
|
|
|
Borrowings under revolving commitment
|
|
|
-
|
|
|
|
7,000
|
|
|
Repayments on revolving commitment
|
|
|
-
|
|
|
|
(4,015
|
)
|
|
Borrowing on long-term debt
|
|
|
-
|
|
|
|
15,000
|
|
|
Repayments on long-term debt
|
|
|
-
|
|
|
|
(2,275
|
)
|
|
Net cash provided by financing activities
|
|
|
9,466
|
|
|
|
15,710
|
|
|
Net increase in cash
|
|
|
14,190
|
|
|
|
1,883
|
|
|
Cash and restricted cash at beginning of year
|
|
|
52,648
|
|
|
|
24,188
|
|
|
Cash and restricted cash at end of quarter
|
|
$
|
66,838
|
|
|
$
|
26,071
|
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
|
|
Cash paid during the period for interest
|
|
$
|
1,812
|
|
|
$
|
1,512
|
|
|
Cash paid during the period for taxes
|
|
$
|
93
|
|
|
$
|
259
|
|
|
Supplemental disclosures of non-cash activities:
|
|
|
|
|
|
|
|
|
|
Capital expenditures included in accounts payable
|
|
$
|
502
|
|
|
$
|
224
|
|
|
|
|
|
|
|
|
|
|
ICHOR HOLDINGS, LTD.
|
|
Reconciliation of U.S. GAAP Net Income from Continuing Operations
to Non-GAAP Adjusted Net Income from Continuing Operations
|
|
(in thousands, except share and per share data)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
|
|
|
June 30,
2017
|
|
|
March 31,
2017
|
|
|
June 24,
2016
|
|
|
June 30,
2017
|
|
|
June 24,
2016
|
|
|
|
|
(in thousands, except share and per share amounts)
|
|
|
Net income from continuing operations
|
|
$
|
10,470
|
|
|
$
|
12,952
|
|
|
$
|
3,275
|
|
|
$
|
23,422
|
|
|
$
|
5,107
|
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of intangible assets
|
|
|
1,803
|
|
|
|
1,795
|
|
|
|
1,803
|
|
|
|
3,598
|
|
|
|
3,406
|
|
|
Share-based compensation (1)
|
|
|
569
|
|
|
|
344
|
|
|
|
555
|
|
|
|
913
|
|
|
|
972
|
|
|
Other non-recurring (income) expenses (2)
|
|
|
952
|
|
|
|
(500
|
)
|
|
|
1,342
|
|
|
|
452
|
|
|
|
2,055
|
|
|
Tax adjustments related to non-GAAP adjustments
|
|
|
(18
|
)
|
|
|
(24
|
)
|
|
|
(19
|
)
|
|
|
(42
|
)
|
|
|
(39
|
)
|
|
Tax benefit related to Ajax acquisition
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Adjustments to cost of goods sold (3)
|
|
|
1,752
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,752
|
|
|
|
-
|
|
|
Non-GAAP adjusted net income from continuing operations
|
|
$
|
15,528
|
|
|
$
|
14,567
|
|
|
$
|
6,956
|
|
|
$
|
30,095
|
|
|
$
|
11,501
|
|
|
Non-GAAP adjusted diluted EPS (4)
|
|
$
|
0.60
|
|
|
$
|
0.57
|
|
|
$
|
0.29
|
|
|
$
|
1.16
|
|
|
$
|
0.48
|
|
|
Shares used to compute diluted EPS (5)
|
|
|
26,063,527
|
|
|
|
25,640,089
|
|
|
|
24,029,793
|
|
|
|
25,868,403
|
|
|
|
24,037,305
|
|
|
(1)
|
|
Of the total share-based compensation expense non-GAAP adjustment,
$27, $8, and $0 is included in cost of sales for the second quarter
of 2017, first quarter of 2017, and second quarter of 2016,
respectively, and $542, $336, and $555 is included in operating
expenses for the second quarter of 2017, first quarter of 2017, and
second quarter of 2016, respectively. Of the total share-based
compensation expense non-GAAP adjustment, $35 and $5 is included in
cost of sales for the six months ended June 30, 2017 and June 24,
2016, respectively, and $878 and $967 is included in operating
expenses for the six months ended June 30, 2017 and June 24, 2016,
respectively.
|
|
(2)
|
|
Included in this amount for the second quarter of 2017 are (i)
expenses incurred in connection with the secondary offering of our
ordinary shares by FP and (ii) acquisition-related expenses.
Included in this amount for the first quarter of 2017 is (i) a
refund from FPC and (ii) a gain on sale of our investment in CHawk.
Included in this amount for the six months ended June 30, 2017 are
(i) expenses incurred in connection with the secondary offering of
our ordinary shares by FP, (ii) acquisition-related expenses, (iii)
a refund from FPC, and (iv) a gain on sale of our investment in
CHawk. Included in this amount for the second quarter of 2016 and
the six months ended June 24, 2016 are (i) IPO preparation expenses,
(ii) consulting fees paid to FPC, (iii) bonuses paid to members of
our management in connection with the cash dividend paid by us in
August 2015, and (iv) acquisition-related expenses.
|
|
(3)
|
|
During the second quarter of 2017, we corrected an error related to
translating the inventory balances at our Malaysia and Singapore
subsidiaries at an incorrect foreign currency rate. The error arose
in prior period financial statements beginning in periods prior to
2014 and through 2016. The correction resulted in a $1.75 million
increase in cost of sales and a corresponding decrease in gross
profit in our consolidated statement of operations and a decrease to
inventories in our consolidated balance sheet during the second
quarter of 2017.
|
|
(4)
|
|
Calculated by dividing non-GAAP adjusted net income from continuing
operations by diluted shares outstanding.
|
|
(5)
|
|
For the quarter second quarter of 2016, assumes the IPO shares sold,
the conversion of preferred shares into ordinary shares, and vesting
of restricted shares and options in connection with our December
2016 IPO occurred at the beginning of the measurement period, for
comparability between current and prior periods. No adjustment is
needed to diluted shares outstanding for the second and first
quarters of 2017.
|
|
|
|
|
|
|
|
|
|
|
|
ICHOR HOLDINGS, LTD.
|
|
U.S. GAAP and Non-GAAP Summary Consolidated Statements of
Operations
|
|
(in thousands)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
|
|
|
Quarter Ended
|
|
|
Quarter Ended
|
|
|
|
June 30, 2017
|
|
|
March 31, 2017
|
|
|
June 24, 2016
|
|
|
|
U.S.
GAAP
|
|
|
Non-
GAAP
|
|
|
U.S.
GAAP
|
|
|
Non-
GAAP
|
|
|
U.S.
GAAP
|
|
|
Non-
GAAP
|
|
Net sales
|
|
$
|
159,733
|
|
|
$
|
159,733
|
|
|
$
|
148,704
|
|
|
$
|
148,704
|
|
|
$
|
95,365
|
|
|
$
|
95,365
|
|
Cost of sales (1)
|
|
|
136,227
|
|
|
|
134,448
|
|
|
|
124,689
|
|
|
|
124,681
|
|
|
|
80,185
|
|
|
|
80,185
|
|
Gross profit
|
|
|
23,506
|
|
|
|
25,285
|
|
|
|
24,015
|
|
|
|
24,023
|
|
|
|
15,180
|
|
|
|
15,180
|
|
Operating expenses (1)
|
|
|
11,737
|
|
|
|
8,440
|
|
|
|
10,397
|
|
|
|
8,462
|
|
|
|
10,276
|
|
|
|
6,576
|
|
Operating income
|
|
|
11,769
|
|
|
|
16,845
|
|
|
|
13,618
|
|
|
|
15,561
|
|
|
|
4,904
|
|
|
|
8,604
|
|
Interest expense
|
|
|
675
|
|
|
|
675
|
|
|
|
690
|
|
|
|
690
|
|
|
|
1,160
|
|
|
|
1,160
|
|
Other expense (income), net
|
|
|
151
|
|
|
|
151
|
|
|
|
(549
|
)
|
|
|
(245
|
)
|
|
|
244
|
|
|
|
244
|
|
Income from continuing operations before income taxes
|
|
|
10,943
|
|
|
|
16,019
|
|
|
|
13,477
|
|
|
|
15,116
|
|
|
|
3,500
|
|
|
|
7,200
|
|
Income tax expense from continuing operations
|
|
|
473
|
|
|
|
491
|
|
|
|
525
|
|
|
|
549
|
|
|
|
225
|
|
|
|
244
|
|
Net income from continuing operations
|
|
$
|
10,470
|
|
|
$
|
15,528
|
|
|
$
|
12,952
|
|
|
$
|
14,567
|
|
|
$
|
3,275
|
|
|
$
|
6,956
|
|
(1)
|
|
Of the total share-based compensation expense non-GAAP adjustment,
$27, $8, and $0 is included in cost of sales for the second quarter
of 2017, first quarter of 2017, and second quarter of 2016,
respectively, and $542, $336, and $555 is included in operating
expenses for the second quarter of 2017, first quarter of 2017, and
second quarter of 2016, respectively.
|
|
|
|
|
The following table calculates diluted EPS from continuing operations
attributable to ordinary shareholders using the two class method,
required for participating securities, as Ichor had two classes of stock
during 2016. Beginning in the first quarter of 2017, Ichor no longer
uses the two class method, as there is only one class of stock
outstanding subsequent to our December IPO. All preferred shares were
converted into ordinary shares in connection with our December IPO.
|
|
|
|
|
|
|
|
|
ICHOR HOLDINGS, LTD.
|
|
Diluted Earnings per Share from Continuing Operations
Attributable to Common Shareholders
|
|
(in thousands, except share and per share data)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
|
|
|
June 30,
2017
|
|
|
March 31,
2017
|
|
|
June 24,
2016
|
|
|
June 30,
2017
|
|
|
June 24,
2016
|
|
|
Net income from continuing operations
|
|
$
|
10,470
|
|
|
$
|
12,952
|
|
|
$
|
3,275
|
|
|
$
|
23,422
|
|
|
$
|
5,107
|
|
|
Undistributed earnings attributed to preferred shareholders
|
|
|
-
|
|
|
|
-
|
|
|
|
(3,259
|
)
|
|
|
-
|
|
|
|
(5,085
|
)
|
|
Net income from continuing operations, attributable to ordinary
shareholders (1)
|
|
$
|
10,470
|
|
|
$
|
12,952
|
|
|
$
|
16
|
|
|
$
|
23,422
|
|
|
$
|
22
|
|
|
Net income per diluted share from continuing operations attributable
to ordinary shareholders
|
|
$
|
0.40
|
|
|
$
|
0.51
|
|
|
$
|
0.06
|
|
|
$
|
0.91
|
|
|
$
|
0.08
|
|
|
Diluted shares used to compute net income from continuing operations
per share attributable to ordinary shareholders
|
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26,063,527
|
|
|
|
25,640,089
|
|
|
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277,554
|
|
|
|
25,868,403
|
|
|
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285,066
|
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(1)
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Under the two-class method, net income attributable to ordinary
shareholders after deduction of preferred share dividends, if any,
is determined by allocating undistributed earnings between the
ordinary shares and the participating securities based on their
respective rights to receive dividends. Basic net income per share
attributable to ordinary shareholders is computed by dividing net
income attributable to ordinary shareholders by the weighted-average
number of ordinary shares outstanding during the period. All
participating securities are excluded from basic weighted-average
ordinary shares outstanding. Diluted net income per share
attributable to ordinary shareholders is computed by dividing net
income attributable to ordinary shareholders by the weighted average
number of ordinary shares outstanding, including all potentially
dilutive ordinary shares, if the effect of each class of potential
shares of ordinary shares is dilutive.
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For purposes of calculating EPS under the two-class method, an
accounting policy election has been made to treat each income
statement line item (net income from continuing operations, net
income from discontinued operations, and net income) as an
independent calculation and only allocate earnings to participating
securities for those line items for which income is reported, as the
participating securities do not have a contractual obligation to
participate in losses. There is therefore no allocation of losses to
participating securities for those line items for which a loss is
reported. Under this method, the sum of the individual EPS income
statement line items will not reconcile to the total net income per
share.
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