Amtech Reports First Quarter Fiscal 2012 Results
TEMPE, Ariz., Feb. 9, 2012 /PRNewswire/ -- Amtech Systems, Inc. (NASDAQ: ASYS), a global supplier of production and automation systems and related supplies for the manufacture of solar cells, semiconductors, and sapphire and silicon wafers, today reported results for its first fiscal quarter ending December 31, 2011.
First Quarter Fiscal 2012 Financial Summary:
- Net revenue of $24.7 million
- Solar revenue of $15.6 million
- Semi revenue of $9.1 million
- Quarterly bookings of $11.1 million
- Quarter-end backlog of $69.2 million; solar backlog $55.8 million
- Gross margin of 29%
- Operating loss of $1.8 million
- Net loss $876,000, or $(0.09) per diluted share
Mr. Fokko Pentinga, Chief Executive Officer of Amtech, commented, “Although macroeconomic and solar industry headwinds in the first quarter were in line with our expectations, we exceeded the high end of our revenue guidance by nearly seven percent. Importantly, our sales and service teams concentrated on staying current with our customers with respect to their immediate needs and their near and long-term objectives. As a result, we are better positioning ourselves for the next technology buying cycle. Also, we successfully completed several installations and had very strong acceptance activity during the quarter. While we continue to maintain a healthy backlog with minimal cancellations, there have been some extensions in shipment dates.”
“At the onset of the downturn, we moved quickly to reduce expenses as sales came under pressure,” added Mr. Pentinga. “We continued to make adjustments in the quarter and continue to reduce both variable and fixed costs with consideration of the current slow demand and the anticipated improved future demand. It is very important to note that the development of new technologies and expansion of our product offerings through both organic and inorganic growth opportunities continue to be our highest priorities. Our ion implant technology is progressing on schedule and our plan is to introduce the system this May at the Shanghai solar show. For the long term, we continue to stay on course to maintain our strong leadership position in the markets we serve.”
Mr. J.S. Whang, Executive Chairman of the Board of Amtech, commented, “As we previously announced, Fokko became our Chief Executive Officer effective January 1, 2012, and is leading our global business. As Executive Chairman, I continue to participate in the oversight of Amtech’s global business but also have intensified the pursuit of external growth opportunities having strategic importance to our future success. The purpose of the management realignment we have adopted is to further sharpen our focus on all fronts during this down cycle, with the aim of coming out stronger than when we went in.”
Net revenue for the first quarter of fiscal 2012 was $24.7 million, down 59% sequentially from $59.9 million for the preceding quarter, and down 54% from $53.7 million for the first quarter of fiscal 2011. The decrease was driven by lower system shipments to customers in the solar industry. Semiconductor revenue totaled $9.1 million a 16% increase from semiconductor revenue in the first quarter of fiscal 2011 and 19% higher than the fourth quarter of fiscal 2011.
Total orders in the first quarter of fiscal 2012 were $11.1 million ($3.1 million solar), down 34% compared to total orders of $16.8 million ($4.7 million solar) in the preceding quarter due primarily to overcapacity in the solar market.
At December 31, 2011, the Company’s total order backlog was $69.2 million, compared to total backlog of $85.9 million at September 30, 2011. Total backlog at December 31, 2011 includes $55.8 million in solar orders and deferred revenue, compared to solar backlog of $71.2 million at September 30, 2011. The effect of foreign exchange on backlog was a negative $3.1 million in the December quarter. Backlog includes deferred revenue and customer orders that are expected to ship within the next 12 months.
Gross margin in the first quarter of fiscal 2012 was 29%, compared to 34% sequentially and 36% in the first quarter of fiscal 2011. The lower gross margin is primarily due to significantly lower capacity utilization partially offset by higher recognition of previously deferred revenue and cost reductions in manufacturing labor.
Selling, general and administrative (SG&A) expenses in the first quarter of fiscal 2012 were $6.3 million, or 25% of revenue, compared to $10.1 million, or 17% of revenue, in the preceding quarter and $10.4 million, or 19% of revenue, in the first quarter of fiscal 2011. The decrease in SG&A expenses, as compared to the first quarter of fiscal 2011, was primarily due to lower commissions and shipping costs associated with lower volumes and lower legal and consulting fees associated with our acquisition activities.
Research and Development expense was $2.8 million in the first quarter of fiscal 2012 compared to $2.1 million in the preceding quarter and $0.8 million in the first quarter of fiscal 2011. The year-over-year quarterly change is primarily due to investment in the Company's solar ion-implant project and development costs associated with other product and technology development programs.
Depreciation and amortization in the first quarter of fiscal 2012 was $769,000, compared to $818,000 in the fourth quarter of fiscal 2011.
Included in the first quarter of fiscal 2012 results is $465,000 of stock option expense, compared to $374,000 in the fiscal first quarter a year ago and $371,000 in the fourth quarter of 2011.
The income tax benefit in the first quarter of fiscal 2012 is $320,000, resulting in an effective tax rate of approximately 18%, which reflects non-deductible losses related to our research and development investments in China.
The net loss for the first quarter of fiscal 2012 was $876,000, or loss of $0.09 diluted per share, compared to net income of $5.0 million, or $0.52 per diluted share, for the first quarter of fiscal 2011, and net income of $3.1 million, or $0.31 per diluted share, in the preceding quarter. The decrease was primarily due to lower sales volumes and increased investment in research and development.
Total cash and cash equivalents at December 31, 2011 were $54.9 million, compared to $67.4 million at September 30, 2011. The decrease in cash is primarily due to payments to vendors in excess of receipts from customers and payments made in October to shareholders of Kingstone Technology Hong Kong Limited (Kingstone) in connection with the amendment to the Kingstone stock purchase agreement.
While visibility in 2012 continues to be limited, Amtech maintains a long-term positive outlook on the solar market. The current supply/demand imbalance and global economic conditions continue to impact solar cell manufacturers, Amtech’s principal customer base. As a result, the Company expects revenues in its fiscal 2012 second quarter ending March 31 to be in the range of $20 - $22 million, and gross margins to be in-line or slightly lower than the December quarter. With research and development expenses expected to be significantly higher in the March quarter due primarily to the solar ion implant project, Amtech expects to incur a higher net loss in the second quarter.
Operating results could be impacted by the timing of system shipments, the net impact of revenue deferral on those shipments, and recognition of revenue based on customer acceptances, 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.
Amtech Systems will host a conference call and webcast today at 5:00pm EST to discuss first quarter fiscal 2012 financial results. Those in the USA wishing to participate in the live call should dial (877) 317-6789. From Canada, dial (866)-605-3852, and internationally, dial (412) 317-6789. Request “Amtech” when connected to the operator. A replay of the call will be available one hour after the end of the conference through February 16. To access the replay please dial US toll free (877) 344-7529 and enter code 10009437. 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. manufactures capital equipment, including silicon wafer handling automation, thermal processing equipment and related consumables used in fabricating solar cells, LED and semiconductor devices. Semiconductors, or semiconductor chips, are fabricated on silicon wafer substrates, sliced from ingots, and are part of the circuitry, or electronic components, of many products including solar cells, computers, telecommunications devices, automotive products, consumer goods, and industrial automation and control systems. 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 and the polishing of newly sliced silicon wafers.
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 (“the Company” or “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). 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. 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 the Company and its management for future operations.
We cannot guarantee that any forward-looking statement will be realized, although we believe that the expectations reflected in the forward-looking statements are reasonable. Achievement of future results is subject to risks, uncertainties and potentially inaccurate assumptions. The Form 10-K that we filed with the Securities and Exchange Commission for the year-ended September 30, 2011 listed various important factors that could affect Amtech’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.
INCOME STATEMENT - CONSOLIDATED
(amounts in thousands, except per share data)
Three Months Ended
Revenues, net of returns and allowances
Cost of sales
Selling, general and administrative
Research and development
Operating income (loss)
Interest and other income (expense), net
Income (loss) before income taxes
Income tax provision (benefit)
Net income (loss)
Add: Net Loss Attributable to noncontrolling interest
Net income (loss) attributable to Amtech Systems, Inc.
Earnings (Loss) Per Share:
Basic income (loss) per share attributable to Amtech shareholders
Weighted average shares outstanding
Diluted income (loss) per share attributable to Amtech shareholders
Weighted average shares outstanding
BALANCE SHEET - CONSOLIDATED
Cash and cash equivalents
Trade (less allowance for doubtful accounts of $298 and $246 at
December 31, 2011 and September 30, 2011, respectively)
Unbilled and other
Deferred income taxes
Prepaid income taxes
Total current assets
Property, Plant and Equipment - Net
Intangible Assets - Net
Liabilities and Stockholders' Equity
Accrued compensation and related taxes
Accrued warranty expense
Other accrued liabilities
Income taxes payable
Total current liabilities
Income Taxes Payable Long-term
Deferred Income Taxes Long-term
Commitments and Contingencies
Preferred stock; 100,000,000 shares authorized; none issued
Common stock; $0.01 par value; 100,000,000 shares authorized;
shares issued and outstanding: 9,478,457 and 9,431,393
at December 31, 2011 and September 30, 2011, respectively
Additional paid-in capital
Accumulated other comprehensive (loss)
Total Amtech Systems Inc. stockholders' equity
Total Liabilities and Stockholders' Equity
STATEMENT OF CASH FLOWS - CONSOLIDATED
Three Months Ended
Net income (loss)
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities:
Depreciation and amortization
Write-down of inventory
Deferred income taxes
Non-cash share based compensation expense
Provision for allowance for doubtful accounts
Changes in operating assets and liabilities:
Accrued income taxes
Prepaid expenses and other assets
Accrued liabilities and customer deposits
Net cash used in operating activities
Purchases of property, plant and equipment
Net cash used in investing activities
Proceeds from issuance of common stock, net
Repurchase of common stock
Payments on long-term obligations
Excess tax benefit of stock options
Net cash provided by (used in) financing activities
Effect of Exchange Rate Changes on Cash
Net Decrease in Cash and Cash Equivalents
Cash and Cash Equivalents, Beginning of Period
Cash and Cash Equivalents, End of Period
SOURCE Amtech Systems, Inc.
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