Axcelis Announces Financial Results For Second Quarter 2018

Company Reports Accelerated Gross Margin Performance and Remains Confident in Future Growth

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Aug 02, 2018, 16:01 ET

BEVERLY, Mass., Aug. 2, 2018 /PRNewswire/ -- Axcelis Technologies, Inc. (Nasdaq: ACLS) today announced financial results for the second quarter ended June 30, 2018.

The Company reported second quarter revenue of $119.3 million, compared to $122.2 million for the first quarter of 2018. Operating profit for the quarter was $19.3 million, compared to $18.5 million for the first quarter. Net income for the quarter was $14.7 million, or $0.43 per diluted share, compared to net income for the first quarter of 2018 of $13.9 million, or $0.41 per diluted share. Cash, cash equivalents and restricted cash were $154.9 million at June 30, 2018, compared to $148.5 million on March 31, 2018.

"We're very pleased with our financial performance in the second quarter driven by solid revenue and earnings growth. Our gross margin initiatives continue to deliver improvements, yielding results above guidance. Demand for our products remains strong across our diverse customer base, and the industry continues to be in a robust, sustained cycle fueled by growth in IoT and big data," said President and CEO Mary Puma. "We are still targeting our $450 million business model in 2018, and anticipate 2019 to be another solid year for equipment CAPEX."

Business Outlook
For the third quarter ending September 30, 2018, Axcelis expects revenues of between $95 and $100 million. Gross margin in the third quarter is expected to be around 40%. Third quarter operating profit is forecasted to be approximately $8-10 million. Earnings per share is expected to be between $0.15 and $0.20.

Second Quarter 2018 Conference Call
The Company will host a conference call today at 5:00 pm ET to discuss the Company's results for the second quarter. The call will be available to interested listeners via an audio webcast that can be accessed through the Investors page of Axcelis' website at www.axcelis.com, or by dialing 866.588.8911 (707.294.1561 outside North America). Participants calling into the conference call will be requested to provide the company name, Axcelis Technologies, and pass code: 2690966. Webcast replays will be available for 30 days following the call.

Safe Harbor Statement
This press release and the conference call contain forward-looking statements under the Private Securities Litigation Reform Act safe harbor provisions. These statements, which include our expectations for spending in our industry and guidance for future financial performance, are based on management's current expectations and should be viewed with caution. They are subject to various risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, many of which are outside the control of the Company, including that customer decisions to place orders or our product shipments may not occur when we expect, that orders may not be converted to revenue in any particular quarter, or at all, whether demand will continue for the semiconductor equipment we produce or, if not, whether we can successfully meet changing market requirements, and whether we will be able to maintain continuity of business relationships with and purchases by major customers. Increased competitive pressure on sales and pricing, increases in material and other production costs that cannot be recouped in product pricing and instability caused by changing global economic, political or financial conditions could also cause actual results to differ materially from those in our forward-looking statements. These risks and other risk factors relating to Axcelis are described more fully in the most recent Form 10-K filed by Axcelis and in other documents filed from time to time with the Securities and Exchange Commission.

About Axcelis:
Axcelis (Nasdaq: ACLS), headquartered in Beverly, Mass., has been providing innovative, high-productivity solutions for the semiconductor industry for 40 years. Axcelis is dedicated to developing enabling process applications through the design, manufacture and complete life cycle support of ion implantation systems, one of the most critical and enabling steps in the IC manufacturing process. Learn more about Axcelis at www.axcelis.com.

Company Contacts

Investor Relations:
Doug Lawson
978.787.9552

Editorial/Media:
Maureen Hart
978.787.4266

Axcelis Technologies, Inc. Consolidated Statements of Operations (In thousands, except per share amounts) (Unaudited)

			Three months ended June 30,					Six months ended June 30,
				2018		2017			2018		2017

Revenue:
	Product			$	112,521	$	96,539		$	228,543	$	178,517
	Services				6,812		6,251			12,975		11,166
		Total revenue			119,333		102,790			241,518		189,683
Cost of Revenue:
	Product				63,913		57,689			132,287		104,486
	Services				6,420		6,039			13,075		11,421
		Total cost of revenue			70,333		63,728			145,362		115,907

Gross profit					49,000		39,062			96,156		73,776

Operating expenses:
	Research and development				12,553		11,256			24,786		21,151
	Sales and marketing				8,912		7,485			17,323		14,534
	General and administrative				8,268		7,791			16,278		14,848
		Total operating expenses			29,733		26,532			58,387		50,533

Income from operations					19,267		12,530			37,769		23,243

Other (expense) income:
	Interest income				515		111			925		180
	Interest expense				(1,127)		(1,336)			(2,464)		(2,447)
	Other, net				(1,016)		16			(1,118)		(138)
		Total other expense			(1,628)		(1,209)			(2,657)		(2,405)

Income before income taxes					17,639		11,321			35,112		20,838

Income tax provision (benefit)					2,970		(2,611)			6,528		(2,600)

Net income				$	14,669	$	13,932		$	28,584	$	23,438

Net income per share:
		Basic		$	0.46	$	0.46		$	0.89	$	0.78
		Diluted		$	0.43	$	0.42		$	0.84	$	0.72

Shares used in computing net income per share:
		Basic weighted average common shares			32,214		30,589			32,154		30,183
		Diluted weighted average common shares			33,942		33,168			34,048		32,779

Axcelis Technologies, Inc. Consolidated Balance Sheets (In thousands, except per share amounts) (Unaudited)

			June 30,		December 31,
			2018		2017
ASSETS
Current assets:
	Cash and cash equivalents		$	147,297	$	133,407
	Short-term restricted cash			730		750
	Accounts receivable, net			74,429		75,302
	Inventories, net			129,554		120,544
	Prepaid expenses & other assets			10,925		9,772
	Total current assets			362,935		339,775
Property, plant and equipment, net				36,312		36,168
Restricted cash				6,915		6,723
Deferred income taxes				77,005		83,148
Other assets				25,264		22,404
		Total assets	$	508,431	$	488,218
	LIABILITIES AND STOCKHOLDERS' EQUITY

	Accounts payable		$	32,633	$	32,642
	Accrued compensation			12,727		20,955
	Warranty			4,698		4,112
	Income taxes			163		273
	Deferred revenue			11,927		16,181
	Other current liabilities			4,542		5,124
	Total current liabilities			66,690		79,287
Sales leaseback obligation				47,735		47,714
Long-term deferred revenue				3,248		1,964
Other long-term liabilities				5,144		5,643
		Total liabilities		122,817		134,608
Commitments and contingencies
Stockholders' equity:
	Common stock, $0.001 par value, 75,000 shares authorized; 32,331 shares issued and outstanding at June 30, 2018; 32,048 shares issued and outstanding at December 31, 2017			32		32
	Additional paid-in capital			559,207		556,147
	Accumulated deficit			(174,561)		(204,745)
	Accumulated other comprehensive income			936		2,176
		Total stockholders' equity		385,614		353,610
		Total liabilities and stockholders' equity	$	508,431	$	488,218