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Amtech Reports Second Quarter Fiscal 2018 Results
[May 10, 2018]

Amtech Reports Second Quarter Fiscal 2018 Results


TEMPE, Ariz., May 10, 2018 /PRNewswire/ -- Amtech Systems, Inc. (NASDAQ: ASYS), a global manufacturer and supplier of production equipment and related supplies for the solar, semiconductor and LED markets, today reported results for its second quarter ended March 31, 2018.

Second Quarter Fiscal 2018 Financial and Operational Highlights:

  • Net revenues of $32.8 million (Solar segment $12.6 million)
  • Net income of $2.8 million
  • Diluted earnings per share of $0.19
  • Customer orders of $28.8 million (Solar segment $7.0 million)
  • Quarter-end backlog of $63.1 million (Solar segment $35.0 million)
  • Book to bill ratio of 0.9:1 (0.6:1 Solar segment)
  • Unrestricted cash of $50.5 million

Mr. Fokko Pentinga, Chief Executive Officer of Amtech, commented, "Our semiconductor and polishing businesses are continuing to show year-over-year growth with sales of higher-margin products contributing to the sequential increase in our gross margin.  Regarding our Solar segment, I am pleased to report that the installation and start-up of Phase I of the multi-phase 1 gigawatt bi-facial order is going smoothly and we have completed the first and second of three milestones.  Our solar revenue is dependent on several factors, including the timing of customers' investment in expanding solar cell production capacity, particularly the timing of turnkey orders.  At this time, we look forward to continuing to assist our solar customers in their planning and review of optimal next-phase investments."

Net revenue for the second quarter of fiscal 2018 was $32.8 million compared to $73.6 million in the preceding quarter and $32.9 million in the second quarter of fiscal 2017.  The sequential decrease is primarily due to the shipment in the first quarter of this fiscal year of all of the equipment for Phase II of the large solar turnkey project.  The timing of large Semiconductor orders and shipments also contributed to the sequential decrease. Compared to the prior year quarter, net revenue is relatively flat, with increases in Semiconductor and Polishing shipments offset by decreases in Solar shipments.

Unrestricted cash and cash equivalents at March 31, 2018 were $50.5 million, compared to $51.1 million at September 30, 2017.

At March 31, 2018, our total order backlog was $63.1 million (Solar segment $35.0 million), compared to total backlog of $65.9 million (Solar segment $39.3 million) at December 31, 2017.  Backlog includes deferred revenue and customer orders that are expected to ship within the next 12 months. 

Gross margin in the second quarter of fiscal 2018 was 36%, compared to 28% in the preceding quarter and 25% in the second quarter of fiscal 2017.  Sequentially and compared to prior year, gross margin increased due to a higher-margin product mix and recognition of previously deferred profit, compared to revenue deferrals in the first quarter of fiscal 2018 and in the second quarter of fiscal 2017.

Selling, general and administrative expense ("SG&A") in the second quarter of fiscal 2018 was $9.5 million, compared to $10.6 million in the preceding quarter and $8.3 million in the second quarter of fiscal 2017.  Sequentially, SG&A decreased primarily due to lower commissions and freight resulting from lower shipments. The increase in SG&A from the prior year quarter is due primarily to increased selling, freight and employee-related expenses.

Research, development and engineering (RD&E) expense was $2.2 million in the second quarter of fiscal 2018 compared to $2.0 million in the preceding quarter and $1.5 million in the second quarter of fiscal 2017.  

Income tax in the second quarter of fiscal 2018 was a benefit of $2.8 million compared to expense of $1.2 million in the preceding quarter and expense of $0.2 million in the second quarter of fiscal 2017. The tax benefit recorded in the second quarter of fiscal 2018 is primarily due to the resolution of an uncertain tax position.

Net income for the second quarter of fiscal 2018 was $2.8 million, or $0.19 per diluted share, compared to a net loss of $1.4 million, or $0.11 per share for the second quarter of fiscal 2017 and net income of $6.5 million or $0.42 per diluted share in the preceding quarter.

Outlook

The company expects revenues for the quarter ending June 30, 2018 to be in the range of $34 to $37 million. Gross margin for the quarter ending June 30, 2018 is expected to be in the mid to upper 20 percent range, with operating margin slightly negative.

The solar and semiconductor equipment industries can be cyclical and inherently impacted by changes in market demand. Additionally, operating results can be impacted by the timing of orders, system shipments and the financial results of solar and semiconductor manufacturers.  The results for the coming quarters will be significantly influenced by the timing of the Phase III order of the 1GW turnkey project. Operating results could also be affected by the net impact of revenue deferral on shipments, recognition of revenue based on customer acceptances, and meeting start-up milestones of the turnkey production lines, all of which can have a significant effect on operating results.

A substantial portion of Amtech's revenues are denominated in Euros.  The revenue outlook provided in this press release is based on an assumed exchange rate between the United States Dollar and the Euro.  A significant decrease in the value of the Euro in relation to the United States Dollar could cause actual revenues to be lower than anticipated.

Conference Call

Amtech Systems will host a conference call and webcast today at 5:00 p.m. ET to discuss second quarter fiscal 2018 financial results.  Those in the USA wishing to participate in the live call should dial (844) 868-9329. From Canada, dial (866) 605-3852, and internationally, dial (412) 317-6703.  Request "Amtech" when connected to the operator.  A replay of the call will be available one hour after the end of the conference call through May 17, 2018.  To access the replay please dial US toll free (877) 344-7529 and enter code 10119630.  Internationally, dial (412) 317-0088 and use the same code.  A live and archived web cast of the conference call can be accessed in the investor relations section of Amtech's website at www.amtechsystems.com.

About Amtech Systems, Inc.

Amtech Systems, Inc. is a global supplier of advanced thermal processing equipment to the solar, semiconductor / electronics, and LED manufacturing markets. Amtech's equipment includes diffusion, ALD and PECVD systems and solder reflow systems. Amtech also supplies wafer handling automation and polishing equipment and related consumable products. The Company's wafer handling, thermal processing and consumable products currently address the diffusion, oxidation, and deposition steps used in the fabrication of solar cells, LEDs, semiconductors, MEMS, printed circuit boards, semiconductor packaging, and the polishing of newly sliced sapphire and silicon wafers. Amtech's products are recognized under the leading brand names Tempress Systems, Bruce Technologies, PR Hoffman, R2D Automation, SoLayTec, and BTU International.

Cautionary Note Regarding Forward-Looking Statements

Certain information contained in this press release is forward-looking in nature. All statements in this press release, or made by management of Amtech Systems, Inc. and its subsidiaries ("Amtech"), other than statements of historical fact, are hereby identified as "forward-looking statements" (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). The forward-looking statements in this press release relate only to events or information as of the date on which the statements are made in this press release.  Examples of forward-looking statements include statements regarding Amtech's future financial results, operating results, business strategies, projected costs, products under development, competitive positions, and plans and objectives of Amtech and its management for future operations.  In some cases, forward-looking statements can be identified by terminology such as "may," "will," "should," "would," "expects," "plans," "anticipates," "intends," "believes," "estimates," "predicts," "potential," "continue," or the negative of these terms or other comparable terminology or our management are intended to identify such forward-looking statements.  These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. The Form 10-K, as amended, that Amtech filed with the Securities and Exchange Commission (the "SEC") for the year-ended September 30, 2017, listed various important factors that could affect the company's future operating results and financial condition and could cause actual results to differ materially from historical results and expectations based on forward-looking statements made in this document or elsewhere by Amtech or on its behalf.  These factors can be found under the heading "Risk Factors" in the Form 10-K and investors should refer to them.  Because it is not possible to predict or identify all such factors, any such list cannot be considered a complete set of all potential risks or uncertainties.  Except as required by law, we undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events, or otherwise.

Contacts:





Amtech Systems, Inc.

Robert T. Hass

Chief Financial Officer

(480) 967-5146

irelations@Amtechsystems.com

Christensen

Investor Relations

Patty Bruner

(480) 201-6075

pbruner@christensenir.com


 

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

May 10, 2018

(Unaudited)


Condensed Consolidated Statements of Operations










(in thousands, except per share data)



















Three Months Ended March 31,


Six Months Ended March 31,


2018


2017


2018


2017

Revenues, net of returns and allowances

$

32,783



$

32,944



$

106,394



$

62,079


Cost of sales

21,058



24,549



74,332



45,241


Gross profit

11,725



8,395



32,062



16,838










Selling, general and administrative

9,478



8,260



20,058



15,258


Research, development and engineering

2,182



1,535



4,173



3,163


Operating income (loss)

65



(1,400)



7,831



(1,583)










Income (loss) from equity method investment

28



52



2



(91)


Interest and other expense, net

(38)



(197)



(86)



(116)


Income (loss) before income taxes

55



(1,545)



7,747



(1,790)


Income tax (benefit) provision

(2,780)



194



(1,540)



284


Net income (loss)

2,835



(1,739)



9,287



(2,074)










Add: net loss attributable to noncontrolling interest



319





599


Net income (loss) attributable to Amtech Systems, Inc.

$

2,835



$

(1,420)



$

9,287



$

(1,475)










Income (Loss) Per Share:








Basic income (loss) per share attributable to Amtech shareholders

$

0.19



$

(0.11)



$

0.63



$

(0.11)


Weighted average shares outstanding

14,891



13,188



14,835



13,184


Diluted income (loss) per share attributable to Amtech shareholders

$

0.19



$

(0.11)



$

0.61



$

(0.11)


Weighted average shares outstanding

15,154



13,188



15,223



13,184


 

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

May 10, 2018

(unaudited)


Condensed Consolidated Balance Sheets





(in thousands, except share data)







March 31,
2018


September 30,
2017

Assets





Current Assets





Cash and cash equivalents


$

50,495



$

51,121


Restricted cash


9,662



24,640


Accounts receivable





Trade (less allowance for doubtful accounts of $1,499 and $866 at March 31, 2018, and September 30, 2017, respectively)


22,719



22,519


Unbilled and other


18,651



14,275


Inventories


29,043



30,210


Vendor deposits


3,034



11,806


Other


2,633



2,542


Total current assets


136,237



157,113


Property, Plant and Equipment - Net


16,083



15,792


Intangible Assets - Net


3,289



3,495


Goodwill - Net


11,646



11,405


Investments


2,616



2,615


Deferred Income Taxes - Long-Term


200



200


Other Assets - Long-Term


946



1,003


Total Assets


$

171,017



$

191,623


Liabilities and Stockholders' Equity





Current Liabilities





Accounts payable


$

19,129



$

21,555


Accrued compensation and related taxes


6,865



7,592


Accrued warranty expense


1,495



1,254


Other accrued liabilities


3,262



2,056


Customer deposits


18,260



48,784


Current maturities of long-term debt


369



361


Deferred profit


5,085



4,081


Income taxes payable


1,933



286


Total current liabilities


56,398



85,969


Long-Term Debt


8,217



8,134


Income Taxes Payable - Long-Term


3,490



7,037


Total Liabilities


68,105



101,140


Commitments and Contingencies





Stockholders' Equity





Preferred stock; 100,000,000 shares authorized; none issued





Common stock; $0.01 par value; 100,000,000 shares authorized;

shares issued and outstanding: 14,896,004 and 14,710,591 at March 31, 2018, and September 30, 2017, respectively


149



147


Additional paid-in capital


127,367



125,564


Accumulated other comprehensive loss


(7,192)



(8,529)


Retained deficit


(17,412)



(26,699)


Total stockholders' equity


102,912



90,483


Total Liabilities and Stockholders' Equity


$

171,017



$

191,623


 

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

May 10, 2018

(unaudited)


Condensed Consolidated Statements of Cash Flows




(in thousands)









Six Months Ended March 31,


2018


2017

Operating Activities




Net income (loss)

$

9,287



$

(2,074)


Adjustments to reconcile net loss to net cash (used in) provided by operating activities:




Depreciation and amortization

916



1,255


Write-down of inventory

126



51


Capitalized interest

143



204


Deferred income taxes

(23)



24


Non-cash share based compensation expense

463



624


(Gain) loss on sale of property, plant and equipment

(57)



9


(Gain) loss from equity method investment

(2)



91


Provision for (reversal of) allowance for doubtful accounts, net

48



(1,217)


Changes in operating assets and liabilities:




Restricted cash

15,710



(1,703)


Accounts receivable

(3,642)



(2,002)


Inventories

1,644



1,840


Accrued income taxes

(1,899)



169


Vendor deposits and other assets

9,097



(5,557)


Accounts payable

(2,954)



1,823


Customer deposits and accrued liabilities

(31,481)



17,531


Deferred profit

819



520


Net cash (used in) provided by operating activities

(1,805)



11,588


Investing Activities




Purchases of property, plant and equipment

(686)



(210)


Proceeds from sale of property, plant and equipment

68



34


Net cash used in investing activities

(618)



(176)


Financing Activities




Proceeds from exercise of stock options

1,340



94


Payments on long-term debt

(183)



(319)


Borrowings on long-term debt



137


Net cash provided by (used in) financing activities

1,157



(88)


Effect of Exchange Rate Changes on Cash and Cash Equivalents

640



(119)


Net (Decrease) Increase in Cash and Cash Equivalents

(626)



11,205


Cash and Cash Equivalents, Beginning of Period

51,121



27,655


Cash and Cash Equivalents, End of Period

$

50,495



$

38,860






 

Cision View original content:http://www.prnewswire.com/news-releases/amtech-reports-second-quarter-fiscal-2018-results-300646656.html

SOURCE Amtech Systems, Inc.


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