Intevac, Inc. Announces First Quarter 2001 Financial Results

Revenues Increase 70%, Backlog Increases 58% Over First Quarter of 2000



Apr 17, 2001, 01:00 ET from Intevac, Inc.

    SANTA CLARA, Calif., April 17 /PRNewswire/ --
 Intevac, Inc. (Nasdaq: IVAC), today reported financial results for the
 three-month period ended March 31, 2001.
     Intevac's first quarter revenues were $10.0 million, a 70% increase over
 the $5.9 million reported in the first quarter of 2000.  Net loss for the
 first quarter was ($3.8) million, or ($0.32) per share, diluted, on
 11.9 million weighted average shares outstanding.  The net loss of
 ($3.8) million includes a $2.0 million write down of commercial paper issued
 by Pacific Gas & Electric Company, which recently filed for reorganization
 under Chapter 11 the US Bankruptcy Code.  The net loss for the first quarter
 of 2001, without the effect of the write down, would have been ($1.8) million,
 or ($0.15) per share, diluted.
     The ($3.8) million net loss compares to a net loss of ($2.9) million, or
 ($0.24) per share, diluted, for the first quarter of 2000.  The ($2.9) million
 net loss included a credit to restructuring expense of approximately
 $0.6 million, equivalent to $0.05 per share, diluted, related to early
 completion of the Company's plan to consolidate operations at its Santa Clara
 headquarters.  The net loss for the first quarter of 2000 excluding the credit
 to restructuring expense was ($3.5) million or ($0.30) per share, diluted.
     Backlog totaled $46.1 million at March 31, 2001 as compared to
 $42.1 million at December 31, 2000 and $29.1 million at April 1, 2000.
     "I am pleased with our effort in developing Flat Panel Display equipment
 business, as evidenced by growth in our backlog.  We are encouraged by strong
 interest in our D-STAR(R) and Rapid Thermal Processing systems from customers
 in Japan and Southeast Asia.  We also continue to see healthy upgrade orders
 from our disk equipment customers." stated Ajit Rode, Intevac's Chief
 Executive Officer.
     "Good progress continued on our LIVAR(R) products in the first quarter,"
 said Verle Aebi, President of Intevac's Photonics Division.  "We delivered
 three more flight cameras to Lockheed-Martin for the Airborne Laser Program.
 Two more cameras remain to be delivered for completion of this successful
 program.  LIVAR(R) was also demonstrated for the U.K. Ministry of Defense.
 This maritime demonstration showed that LIVAR(R) has significant seaborne
 applications, in addition to the airborne and landborne applications
 previously identified, and further broadens the military market for LIVAR(R).
     We received the first order for our commercial LIVAR(R) camera product,
 the Model 120, which was announced last quarter and a $1.9 million contract
 was received from the US Air Force to environmentally harden the LIVAR(R)
 camera and reduce manufacturing costs.  Separately the US Army released a
 major solicitation, the Cost Effective Targeting System, which uses LIVAR(R)
 as one of its key technologies.  This solicitation starts the process to
 develop fieldable equipment using LIVAR(R) for the Army."
     The Company will discuss its financial results and expectations for 2001
 in a conference call at 2:00 p.m. Pacific Daylight Time.  To listen to the
 conference call please dial 719-457-2661 a few minutes before the call, or go
 to Intevac's web site, www.intevac.com, access the "IR Calendar" page in the
 Investor Relations section and follow the links to the conference call
 webcast.  Replays of the conference call will be available at Intevac's web
 site or by dialing 719-457-0820 (code 585500) after 4:00 PM Pacific Daylight
 Time.
     Intevac's Equipment business is a leading supplier of sputtering systems
 used to manufacture thin-film disks for computer hard disk drives.  Sputtering
 is a complex vacuum deposition process used to deposit multiple thin-film
 layers on a disk.  The Equipment business also realizes revenues from the
 sales of disk lubrication equipment and flat panel display manufacturing
 equipment.  Intevac's Photonics business develops electro-optical devices that
 permit highly sensitive detection of photons in the visible and short wave
 infrared portions of the spectrum.  This technology, when combined with
 advanced silicon integrated circuits, makes it possible to produce highly
 sensitive video cameras.  This development work is creating new products for
 both military and industrial applications.  Products include Intensified
 Digital Video Sensors, cameras incorporating those sensors and Laser
 Illuminated Viewing and Ranging ("LIVAR(R)") systems for positive target
 identification.
     For more information visit the Company's website at www.intevac.com or
 contact Charles Eddy, Chief Financial Officer, Intevac, Inc., 3560 Bassett
 Street, Santa Clara, CA 95054, 408-496-2259, ceddy@intevac.com
 
     This press release includes statements that constitute "forward-looking
 statements" within the meaning of the Private Securities Litigation Reform Act
 of 1995 (the "Reform Act").  Intevac claims the protection of the safe-harbor
 for forward-looking statements contained in the Reform Act.  These
 forward-looking statements are often characterized by the terms "may,"
 "believes," "projects," "expects," or "anticipates," and do not reflect
 historical facts.  Specific forward-looking statements contained in this press
 release include, but are not limited to, market acceptance of the company's
 equipment and photonics products and the company's ability to make additional
 sales to large flat panel display customers.  Forward-looking statements
 involve risks, uncertainties and other factors which may cause actual results,
 performance or achievements of Intevac to be materially different from those
 expressed or implied by such forward-looking statements.  Additional risk
 factors are detailed in Intevac's Annual Report on Form 10-K for the period
 ended December 31, 2000 and its Quarterly Report on Form 10-Q for the period
 ended March 31, 2001.
 
 
     CONSOLIDATED STATEMENTS OF OPERATIONS
     (In thousands, except per share amounts)
 
                                                           3 months ended
                                                       Mar. 31,       Apr. 1,
                                                         2001          2000
                                                     (Unaudited)   (Unaudited)
 
     Net revenues
       Equipment                                       $7,932         $4,859
       Photonics                                        2,073          1,033
         Total net revenues                            10,005          5,892
 
     Gross profit                                       3,400            651
     Gross margin
       Equipment                                        45.0%          25.7%
       Photonics                                       (8.1%)         (44.2%)
       Consolidated(A)                                  34.0%          11.0%
 
     Operating expenses
       Research and development expense                 3,496          2,461
       Selling, general and administrative expense      1,669          1,585
       Restructuring expense                               --           (615)
         Total operating expenses                       5,165          3,431
 
     Operating income (loss)
       Equipment                                         (563)        (1,769)
       Photonics                                         (662)          (884)
       Corporate and other                               (540)          (127)
     Total operating loss                              (1,765)        (2,780)
       Other income (expense)                          (2,019)           (81)
     Loss before provision for income taxes            (3,784)        (2,861)
       Provision for (benefit from) income taxes(C)        --             --
     Loss from continuing operations                   (3,784)        (2,861)
 
     Net loss                                         ($3,784)       ($2,861)
 
     Per share - Basic
       Loss from continuing operations                 ($0.32)       ($0.24)
       Net loss                                        ($0.32)       ($0.24)
     Per share - Diluted(B)
       Loss from continuing operations                 ($0.32)       ($0.24)
       Net loss                                        ($0.32)       ($0.24)
     Weighted average common shares outstanding
       Basic                                          11,896         11,759
       Diluted(B)                                     11,896         11,759
 
     (A) Consolidated gross margin includes amortization of goodwill and other
         intangibles in the three month periods ending March  31, 2001 and
         April 1, 2000, respectively, of $0 and $143.
     (B) Diluted earnings per share exclude "as converted" treatment of the
         Company's 6 1/2% Convertible Subordinated Notes Due 2004 and the
         effect of outstanding stock options when those treatments are
         anti-dilutive to earnings per share.
     (C) The Company did not accrue any tax benefits during the three month
         periods ending March  31, 2001 and April 1, 2000.  Net deferred tax
         assets at March 31, 2001 and April 1, 2000 totaled $7,722 and $7,722
         respectively.
 
 
     CONDENSED CONSOLIDATED BALANCE SHEETS
     (In thousands)
 
     ASSETS                                          March 31,        Dec. 31
                                                       2001            2000
                                                    (Unaudited)
 
     Current assets
       Cash, cash equivalents
        and shortterm investments                     $31,666        $38,403
       Accounts receivable, net                         7,717          9,593
       Inventories                                     23,884         15,833
       Prepaid expenses and other current assets        1,196            844
       Deferred tax assets                              4,041          4,041
         Total current assets                          68,504         68,714
 
     Property, plant and equipment, net                10,581         11,060
     Investment in 601 California Avenue LLC            2,431          2,431
     Goodwill and other intangibles                         2              7
     Debt issuance costs                                  713            774
     Deferred tax assets and other long
      term assets                                       3,684          3,684
         Total assets                                 $85,915        $86,670
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
 
     Current liabilities
       Notes payable                                       --         $1,904
       Accounts payable                                 6,397          2,757
       Accrued payroll and related liabilities          1,895          1,534
       Other accrued liabilities                        4,883          5,109
       Customer advances                               17,259         16,317
         Total current liabilities                     30,434         27,621
 
     Convertible notes                                 41,245         41,245
     Other long-term debt                                  --             --
     Shareholders' equity
       Common stock                                    18,891         18,675
       Retained earnings                               (4,655)          (871)
         Total shareholders' equity                    14,236         17,804
         Total liabilities and
          shareholders' equity                        $85,915        $86,670
 
 

SOURCE Intevac, Inc.
    SANTA CLARA, Calif., April 17 /PRNewswire/ --
 Intevac, Inc. (Nasdaq: IVAC), today reported financial results for the
 three-month period ended March 31, 2001.
     Intevac's first quarter revenues were $10.0 million, a 70% increase over
 the $5.9 million reported in the first quarter of 2000.  Net loss for the
 first quarter was ($3.8) million, or ($0.32) per share, diluted, on
 11.9 million weighted average shares outstanding.  The net loss of
 ($3.8) million includes a $2.0 million write down of commercial paper issued
 by Pacific Gas & Electric Company, which recently filed for reorganization
 under Chapter 11 the US Bankruptcy Code.  The net loss for the first quarter
 of 2001, without the effect of the write down, would have been ($1.8) million,
 or ($0.15) per share, diluted.
     The ($3.8) million net loss compares to a net loss of ($2.9) million, or
 ($0.24) per share, diluted, for the first quarter of 2000.  The ($2.9) million
 net loss included a credit to restructuring expense of approximately
 $0.6 million, equivalent to $0.05 per share, diluted, related to early
 completion of the Company's plan to consolidate operations at its Santa Clara
 headquarters.  The net loss for the first quarter of 2000 excluding the credit
 to restructuring expense was ($3.5) million or ($0.30) per share, diluted.
     Backlog totaled $46.1 million at March 31, 2001 as compared to
 $42.1 million at December 31, 2000 and $29.1 million at April 1, 2000.
     "I am pleased with our effort in developing Flat Panel Display equipment
 business, as evidenced by growth in our backlog.  We are encouraged by strong
 interest in our D-STAR(R) and Rapid Thermal Processing systems from customers
 in Japan and Southeast Asia.  We also continue to see healthy upgrade orders
 from our disk equipment customers." stated Ajit Rode, Intevac's Chief
 Executive Officer.
     "Good progress continued on our LIVAR(R) products in the first quarter,"
 said Verle Aebi, President of Intevac's Photonics Division.  "We delivered
 three more flight cameras to Lockheed-Martin for the Airborne Laser Program.
 Two more cameras remain to be delivered for completion of this successful
 program.  LIVAR(R) was also demonstrated for the U.K. Ministry of Defense.
 This maritime demonstration showed that LIVAR(R) has significant seaborne
 applications, in addition to the airborne and landborne applications
 previously identified, and further broadens the military market for LIVAR(R).
     We received the first order for our commercial LIVAR(R) camera product,
 the Model 120, which was announced last quarter and a $1.9 million contract
 was received from the US Air Force to environmentally harden the LIVAR(R)
 camera and reduce manufacturing costs.  Separately the US Army released a
 major solicitation, the Cost Effective Targeting System, which uses LIVAR(R)
 as one of its key technologies.  This solicitation starts the process to
 develop fieldable equipment using LIVAR(R) for the Army."
     The Company will discuss its financial results and expectations for 2001
 in a conference call at 2:00 p.m. Pacific Daylight Time.  To listen to the
 conference call please dial 719-457-2661 a few minutes before the call, or go
 to Intevac's web site, www.intevac.com, access the "IR Calendar" page in the
 Investor Relations section and follow the links to the conference call
 webcast.  Replays of the conference call will be available at Intevac's web
 site or by dialing 719-457-0820 (code 585500) after 4:00 PM Pacific Daylight
 Time.
     Intevac's Equipment business is a leading supplier of sputtering systems
 used to manufacture thin-film disks for computer hard disk drives.  Sputtering
 is a complex vacuum deposition process used to deposit multiple thin-film
 layers on a disk.  The Equipment business also realizes revenues from the
 sales of disk lubrication equipment and flat panel display manufacturing
 equipment.  Intevac's Photonics business develops electro-optical devices that
 permit highly sensitive detection of photons in the visible and short wave
 infrared portions of the spectrum.  This technology, when combined with
 advanced silicon integrated circuits, makes it possible to produce highly
 sensitive video cameras.  This development work is creating new products for
 both military and industrial applications.  Products include Intensified
 Digital Video Sensors, cameras incorporating those sensors and Laser
 Illuminated Viewing and Ranging ("LIVAR(R)") systems for positive target
 identification.
     For more information visit the Company's website at www.intevac.com or
 contact Charles Eddy, Chief Financial Officer, Intevac, Inc., 3560 Bassett
 Street, Santa Clara, CA 95054, 408-496-2259, ceddy@intevac.com
 
     This press release includes statements that constitute "forward-looking
 statements" within the meaning of the Private Securities Litigation Reform Act
 of 1995 (the "Reform Act").  Intevac claims the protection of the safe-harbor
 for forward-looking statements contained in the Reform Act.  These
 forward-looking statements are often characterized by the terms "may,"
 "believes," "projects," "expects," or "anticipates," and do not reflect
 historical facts.  Specific forward-looking statements contained in this press
 release include, but are not limited to, market acceptance of the company's
 equipment and photonics products and the company's ability to make additional
 sales to large flat panel display customers.  Forward-looking statements
 involve risks, uncertainties and other factors which may cause actual results,
 performance or achievements of Intevac to be materially different from those
 expressed or implied by such forward-looking statements.  Additional risk
 factors are detailed in Intevac's Annual Report on Form 10-K for the period
 ended December 31, 2000 and its Quarterly Report on Form 10-Q for the period
 ended March 31, 2001.
 
 
     CONSOLIDATED STATEMENTS OF OPERATIONS
     (In thousands, except per share amounts)
 
                                                           3 months ended
                                                       Mar. 31,       Apr. 1,
                                                         2001          2000
                                                     (Unaudited)   (Unaudited)
 
     Net revenues
       Equipment                                       $7,932         $4,859
       Photonics                                        2,073          1,033
         Total net revenues                            10,005          5,892
 
     Gross profit                                       3,400            651
     Gross margin
       Equipment                                        45.0%          25.7%
       Photonics                                       (8.1%)         (44.2%)
       Consolidated(A)                                  34.0%          11.0%
 
     Operating expenses
       Research and development expense                 3,496          2,461
       Selling, general and administrative expense      1,669          1,585
       Restructuring expense                               --           (615)
         Total operating expenses                       5,165          3,431
 
     Operating income (loss)
       Equipment                                         (563)        (1,769)
       Photonics                                         (662)          (884)
       Corporate and other                               (540)          (127)
     Total operating loss                              (1,765)        (2,780)
       Other income (expense)                          (2,019)           (81)
     Loss before provision for income taxes            (3,784)        (2,861)
       Provision for (benefit from) income taxes(C)        --             --
     Loss from continuing operations                   (3,784)        (2,861)
 
     Net loss                                         ($3,784)       ($2,861)
 
     Per share - Basic
       Loss from continuing operations                 ($0.32)       ($0.24)
       Net loss                                        ($0.32)       ($0.24)
     Per share - Diluted(B)
       Loss from continuing operations                 ($0.32)       ($0.24)
       Net loss                                        ($0.32)       ($0.24)
     Weighted average common shares outstanding
       Basic                                          11,896         11,759
       Diluted(B)                                     11,896         11,759
 
     (A) Consolidated gross margin includes amortization of goodwill and other
         intangibles in the three month periods ending March  31, 2001 and
         April 1, 2000, respectively, of $0 and $143.
     (B) Diluted earnings per share exclude "as converted" treatment of the
         Company's 6 1/2% Convertible Subordinated Notes Due 2004 and the
         effect of outstanding stock options when those treatments are
         anti-dilutive to earnings per share.
     (C) The Company did not accrue any tax benefits during the three month
         periods ending March  31, 2001 and April 1, 2000.  Net deferred tax
         assets at March 31, 2001 and April 1, 2000 totaled $7,722 and $7,722
         respectively.
 
 
     CONDENSED CONSOLIDATED BALANCE SHEETS
     (In thousands)
 
     ASSETS                                          March 31,        Dec. 31
                                                       2001            2000
                                                    (Unaudited)
 
     Current assets
       Cash, cash equivalents
        and shortterm investments                     $31,666        $38,403
       Accounts receivable, net                         7,717          9,593
       Inventories                                     23,884         15,833
       Prepaid expenses and other current assets        1,196            844
       Deferred tax assets                              4,041          4,041
         Total current assets                          68,504         68,714
 
     Property, plant and equipment, net                10,581         11,060
     Investment in 601 California Avenue LLC            2,431          2,431
     Goodwill and other intangibles                         2              7
     Debt issuance costs                                  713            774
     Deferred tax assets and other long
      term assets                                       3,684          3,684
         Total assets                                 $85,915        $86,670
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
 
     Current liabilities
       Notes payable                                       --         $1,904
       Accounts payable                                 6,397          2,757
       Accrued payroll and related liabilities          1,895          1,534
       Other accrued liabilities                        4,883          5,109
       Customer advances                               17,259         16,317
         Total current liabilities                     30,434         27,621
 
     Convertible notes                                 41,245         41,245
     Other long-term debt                                  --             --
     Shareholders' equity
       Common stock                                    18,891         18,675
       Retained earnings                               (4,655)          (871)
         Total shareholders' equity                    14,236         17,804
         Total liabilities and
          shareholders' equity                        $85,915        $86,670
 
 SOURCE  Intevac, Inc.