2014

Advanced Energy Announces Strong Growth and Profitability in Fourth Quarter Results

FORT COLLINS, Colo., Feb. 16 /PRNewswire-FirstCall/ -- Advanced Energy Industries, Inc. (Nasdaq: AEIS) today announced financial results for the fourth quarter ended December 31, 2009.

Sales for the fourth quarter of 2009 increased 28.4% to $66.4 million from $51.8 million in the third quarter of 2009, and decreased 1.6% from $67.5 million in the fourth quarter of 2008.

Sales to the semiconductor capital equipment markets rose 58.2% sequentially to $32.9 million, representing 49.6% of total sales for the quarter. Sales to the non-semiconductor markets grew 8.6% sequentially to $22.0 million, representing 33.2% of total sales for the quarter. Service revenue also continued strong, increasing 7.6% sequentially to $11.5 million or 17.3% of total sales for the quarter. Bookings for the fourth quarter were $98.0 million, which drove our book to bill ratio to 1.48:1, up from 1.16:1 in the third quarter of 2009. Ending backlog increased 91.2% sequentially to $66.2 million at the end of the fourth quarter compared to $34.6 million at the end of the third quarter of 2009.

Gross margin improved significantly to 36.8% in the fourth quarter, up from 30.1% in the third quarter of 2009 and 27.2% for the fourth quarter of 2008. The sequential improvement was driven largely by leverage against our fixed costs from the increase in revenues.

Fourth quarter net income was $1.5 million or $0.04 per diluted share, compared to a net loss of $8.4 million or a loss per share of $0.20 in the third quarter of 2009. In the fourth quarter of 2008, the net loss was $19.0 million or a loss per share of $0.45, the vast majority of which was a non-cash charge of $18.0 million for income taxes related to a valuation allowance against our deferred tax assets. We are pleased to report that we ended 2009 with cash, cash equivalents and investments of $177.5 million, a decline of just $2.6 million due to our careful cash management during the year.

For the full year 2009, sales were $186.4 million, 43.3% below sales of $328.9 million in 2008. The challenging economic environment impacted sales across all markets, most notably in the semiconductor capital equipment market where sales fell 43.1% from 2008. Net loss from operations for 2009 was $102.7 million, or a loss per share of $2.45. More than half of this was due to a non-cash goodwill impairment charge in the first quarter of 2009 of $63.3 million or $1.51 per share. Net loss for 2008 was $1.8 million or $0.04 per diluted share.

"The fourth quarter marked a high point in 2009, as we grew revenues and achieved profitability by leveraging the cost reductions taken during the year," said Hans Betz, chief executive officer. "The pace of the recovery in the semiconductor capital equipment market ramped significantly in the quarter, as did the penetration of our Solaron inverters into larger, multi-megawatt projects. When the global economy recovers, we expect to benefit from the investments we made in technology during the downturn and our growth in multiple markets."

First Quarter 2010 Guidance

The Company anticipates first quarter 2010 results to be within the following ranges:

  • Sales of $77 million to $83 million
  • Earnings per share of $0.13 to $0.17

Fourth Quarter 2009 Conference Call

Management will host a conference call today, Tuesday, February 16, 2010, at 8:30 am Eastern Standard Time to discuss Advanced Energy's financial results. Domestic callers may access this conference call by dialing (888) 713-4717. International callers may access the call by dialing (816) 650-2836. Participants will need to provide a conference passcode 54700348. For a replay of this teleconference, please call (800) 642-1687 or (706) 645-9291, and enter the passcode 54700348. The replay will be available through 12:00 a.m. Eastern Standard Time, February 18, 2010. A webcast will also be available on the Investor Relations webpage at http://ir.advanced-energy.com.

About Advanced Energy

Advanced Energy® is a global leader in innovative power and control technologies for high-growth, thin-film manufacturing and solar-power generation.  Specifically, AE targets solar grid-tie inverters, solar cells, semiconductors, flat panel displays, data storage products, architectural glass and other advanced applications.

The Company's expectations with respect to guidance to financial results for the first quarter ending March 31, 2010 are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to: the effects of global macroeconomic conditions upon demand for our products, the volatility and cyclicality of the industries the company serves, particularly the semiconductor industry, the timing of orders received from customers, the company's ability to realize cost improvement benefits, and unanticipated changes to management's estimates, reserves or allowances.  These and other risks are described in Advanced Energy's Form 10-K, Forms 10-Q and other reports and statements filed with the Securities and Exchange Commission.  These reports and statements are available on the SEC's website at www.sec.gov. Copies may also be obtained from Advanced Energy's website at www.advancedenergy.com or by contacting Advanced Energy's investor relations at 970-407-6555. Forward-looking statements are made and based on information available to the company on the date of this press release. The company assumes no obligation to update the information in this press release.

    
    
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                     (in thousands, except per share data)
    
                                Three Months Ended       Twelve Months Ended
                            -----------------------------  -------------------
                              December 31,   September 30,    December 31,
                            2009       2008      2009       2009       2008
                            ----       ----      ----       ----       ----
    
    Sales                 $66,439    $67,525   $51,762   $186,395   $328,918
    Cost of sales          41,972     49,128    36,181    132,028    204,136
                           ------     ------   -------    -------    -------
    Gross profit           24,467     18,397    15,581     54,367    124,782
                             36.8%      27.2%     30.1%      29.2%      37.9%
    Operating expenses:
      Research and
       development         11,227     13,424    10,195     43,262     54,952
      Selling, general
       and administrative  11,135      9,513    10,788     41,484     52,273
      Impairment of
       goodwill                 -          -         -     63,260          -
      Amortization of
       intangible assets      148        257       123        613        946
      Restructuring
       charges                  6      1,898       235      4,376      3,487
                           ------     ------   -------    -------    -------
        Total operating
         expenses          22,516     25,092    21,341    152,995    111,658
    
    Income (loss) from
     operations             1,951     (6,695)   (5,760)   (98,628)    13,124
    
    Other income, net         495        553       506      1,910      2,883
                           ------     ------   -------    -------    -------
    Income (loss) from
     operations before
     income taxes           2,446     (6,142)   (5,254)   (96,718)    16,007
    Provision for
     income taxes             923     12,835     3,177      5,987     17,786
                           ------     ------   -------    -------    -------
    
    Net income (loss)      $1,523   $(18,977)  $(8,431) $(102,705)   $(1,779)
                           ======     ======   =======    =======    =======
    
    Basic earnings
     (loss) per share       $0.04     $(0.45)   $(0.20)    $(2.45)    $(0.04)
    
    Diluted earnings
     (loss) per share       $0.04     $(0.45)   $(0.20)    $(2.45)    $(0.04)
    
    Basic weighted-
     average common
     shares outstanding    42,032     41,832    42,004     41,966     42,537
    
    Diluted weighted-
     average common
     shares outstanding    42,464     41,832    42,004     41,966     42,537
    
    
    
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                              (in thousands)
    
                                                       December 31, 
                                                 ----------------------
                                                 2009              2008
                                                 ----              ----
    ASSETS
    
    Current assets:
         Cash and cash equivalents             $133,106          $116,448
         Marketable securities                   44,401            33,266
         Accounts receivable, net                50,267            56,549
         Inventory                               37,118            46,659
         Deferred income taxes, net               9,215            13,253
         Other current assets                     5,640             5,324
                                               --------          --------
    Total current assets                        279,747           271,499
    
    Property and equipment, net                  30,615            31,322
    
    Long-term investments                             -            30,401
    Deposits and other                            9,294             7,528
    Goodwill and intangibles, net                 5,982            72,918
    Deferred income taxes, net                   19,487             6,969
                                               --------          --------
    Total assets                               $345,125          $420,637
                                               ========          ========
    LIABILITIES AND STOCKHOLDERS' EQUITY
    
    Current liabilities:
         Accounts payable                       $23,802            $8,005
         Other accrued expenses                  24,176            23,928
                                               --------          --------
    Total current liabilities                    47,978            31,933
    
    Long-term liabilities                        18,813            12,155
                                               --------          --------
    Total liabilities                            66,791            44,088
    
    Stockholders' equity                        278,334           376,549
                                               --------          --------
    Total liabilities and
     stockholders' equity                      $345,125          $420,637
                                               ========          ========

SOURCE Advanced Energy Industries, Inc.



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