Press Release

Photronics Reports Second Quarter Fiscal 2018 Results

May 22, 2018 at 6:00 AM EDT
PDF Version
  • Second quarter 2018 revenue was $130.8 million, up 6% sequentially and 21% year-over-year
     
  • High-end IC revenue surged 83% year-over-year on strong demand from Asia foundries
     
  • Net income attributable to Photronics, Inc. shareholders was $10.7 million ($0.15 per diluted share)
     
  • Third quarter 2018 guidance: revenue between $128 and $136 million with diluted EPS between $0.12 and $0.18

BROOKFIELD, Conn., May 22, 2018 (GLOBE NEWSWIRE) -- Photronics, Inc. (NASDAQ:PLAB), a worldwide leader in supplying innovative imaging technology solutions for the global electronics industry, today reported financial results for its fiscal 2018 second quarter ended April 29, 2018.

Second quarter revenue was $130.8 million, increases of 6% sequentially and 21% compared with the same quarter prior year. Integrated circuit (IC) revenue was $102.3 million, up 7% sequentially and 24% compared with last year. Flat panel display (FPD) revenue was $28.5 million, up 3% sequentially and 11% compared with last year.

Net income attributable to Photronics, Inc. shareholders was $10.7 million ($0.15 per diluted share), compared with $5.9 million ($0.09 per diluted share) for the first quarter of 2018 and $1.8 million ($0.03 per diluted share) for the second quarter of 2017.

"Performance strengthened again in the second quarter, continuing the sequential revenue growth of the past four quarters,” said Peter Kirlin, chief executive officer. “High-end IC was especially strong year-over-year, up 83%. Sequentially, IC continued to improve in both logic and memory, as customers, particularly Asia foundries, released new designs. High-end FPD was down slightly on soft AMOLED demand, but mainstream improved due to growth in LTPS LCD displays. Operating margin improved with the growth in revenue, although tempered slightly by higher operating expenses. Minority interest increased due to strong earnings from our Taiwan JV, and a foreign exchange gain contributed to the bottom line, resulting in net income of $10.7 million. We ended the quarter with a cash balance of $321 million, which will be very important as we anticipate a ramp of capital expenditures later this year for our new facilities in China.”

Third Quarter 2018 Guidance

For the third quarter of 2018, Photronics expects revenue to be between $128 million and $136 million, and net income attributable to Photronics, Inc. shareholders to be between $0.12 and $0.18 per diluted share.

Conference Call

A conference call to discuss these results is scheduled for 8:30 a.m. Eastern time on Tuesday, May 22, 2018. The call can be accessed by logging onto Photronics' web site at www.photronics.com.  The live dial-in number is (877) 377-7095 or (408) 774-4601 outside of the United States and Canada. The call will be archived on Photronics’ web site for instant replay access.

About Photronics

Photronics is a leading worldwide manufacturer of photomasks. Photomasks are high precision quartz plates that contain microscopic images of electronic circuits. A key element in the manufacture of semiconductors and flat panel displays, photomasks are used to transfer circuit patterns onto semiconductor wafers and flat panel display substrates during the fabrication of integrated circuits, a variety of flat panel displays and, to a lesser extent, other types of electrical and optical components. They are produced in accordance with product designs provided by customers at strategically located manufacturing facilities in Asia, Europe, and North America. Additional information on the Company can be accessed at www.photronics.com

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements made by or on behalf of Photronics, Inc. and its subsidiaries (the Company). The forward-looking statements contained in this press release and other parts of Photronics’ web site involve risks and uncertainties that may affect the Company’s operations, markets, products, services, prices, and other factors. These risks and uncertainties include, but are not limited to, economic, competitive, legal, governmental, and technological factors as well as decisions we may make in the future regarding our business, capital structure and other matters. These forward-looking statements generally can be identified by phrases such as “believes”, “expects”, “anticipates”, “plans”, “projects”, and similar expressions.  Accordingly, there is no assurance that the Company’s expectations will be realized. For a fuller discussion of the factors that may affect the Company's operations, see "Forward Looking Statements" in the Company's Quarterly and Annual Reports to the Securities and Exchange Commission on Forms 10-Q and 10-K. The Company assumes no obligation to provide revisions to any forward-looking statements.

 
PHOTRONICS, INC.
Condensed Consolidated Statements of Income
(in thousands, except per share amounts)
(Unaudited)
         
         
        Three Months Ended   Six Months Ended
         April 29,   January 28,   April 30,    April 29,   April 30,
          2018       2018       2017       2018       2017  
                         
Revenue       $   130,779     $   123,446     $   108,297     $   254,225     $   218,128  
                         
Cost of goods sold         (97,960 )       (95,784 )       (88,140 )       (193,744 )       (174,972 )
                         
  Gross profit           32,819         27,662         20,157         60,481         43,156  
                         
Operating Expenses:                      
                         
  Selling, general and administrative     (13,637 )       (11,750 )       (10,894 )       (25,387 )       (21,765 )
                         
  Research and development       (3,817 )       (4,104 )       (3,726 )       (7,921 )       (7,211 )
                         
Total Operating Expenses       (17,454 )       (15,854 )       (14,620 )       (33,308 )       (28,976 )
                         
  Operating income          15,365         11,808         5,537         27,173         14,180  
                         
Other income (expense), net       3,332         (4,105 )       (3,622 )       (774 )       (5,705 )
                         
  Income before income taxes       18,697         7,703         1,915         26,399         8,475  
                         
Income tax (provision) benefit       (3,508 )       1,778         (431 )       (1,729 )       (2,481 )
                         
  Net income            15,189         9,481         1,484         24,670         5,994  
                         
Net income attributable to noncontrolling interests     (4,524 )       (3,583 )       313         (8,107 )       (2,251 )
                         
Net income attributable to Photronics, Inc. shareholders $   10,665     $   5,898     $   1,797     $   16,563     $   3,743  
                         
Earnings per share:                      
                         
  Basic       $   0.15     $   0.09     $   0.03     $   0.24     $   0.05  
                         
  Diluted       $   0.15     $   0.09     $   0.03     $   0.23     $   0.05  
                         
Weighted-average number of common shares outstanding:                  
                         
  Basic         69,293       68,755       68,426       69,024       68,301  
                         
  Diluted         75,190       69,372       69,385       75,052       69,277  
                         

 

 
PHOTRONICS, INC. 
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
 
             
         April 29,   October 29,
         2018    2017
             
Assets            
             
Current assets:          
  Cash and cash equivalents   $   321,246   $   308,021
  Accounts receivable       124,331       105,320
  Inventories         31,936       23,703
  Other current assets       22,786       12,080
             
  Total current assets       500,299       449,124
             
Property, plant and equipment, net     563,313       535,197
Intangible assets, net       14,708       17,122
Other assets         23,961       19,351
             
Total assets     $   1,102,281   $   1,020,794
             
             
             
Liabilities and Equity        
             
Current liabilities:          
  Current portion of long-term borrowings $   59,263   $   4,639
  Accounts payable and accrued liabilities     107,245       77,137
             
  Total current liabilities       166,508       81,776
             
Long-term borrowings     -       57,337
Other liabilities         17,707       16,386
             
Photronics, Inc. shareholders' equity      783,380       744,564
Noncontrolling interests       134,686       120,731
  Total equity         918,066       865,295
             
Total liabilities and equity   $   1,102,281   $   1,020,794
             
             

 

 
PHOTRONICS,  INC.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
               
               
          Six Months Ended
           April 29,   April 30,
            2018       2017  
               
Cash flows from operating activities:        
  Net income        $   24,670     $   5,994  
  Adjustments to reconcile net income to net cash      
    provided by operating activities:        
  Depreciation and amortization        44,429         42,241  
  Changes in operating assets, liabilities and other     (31,191 )       (1,328 )
               
Net cash provided by operating activities       37,908         46,907  
               
Cash flows from investing activities:        
  Purchases of property, plant and equipment     (44,129 )       (14,152 )
  Acquisition of business       -         (5,400 )
  Proceeds from sale of investments     -         167  
  Other             436         (462 )
               
Net cash used in investing activities       (43,693 )       (19,847 )
               
Cash flows from financing activities:        
  Repayments of long-term borrowings       (2,771 )       (2,695 )
  Contribution from noncontrolling interest     11,998       -  
  Proceeds from share-based arrangements     3,776         2,311  
  Other             (267 )       (23 )
               
Net cash provided by (used in) financing activities     12,736         (407 )
               
Effect of exchange rate changes on cash        6,274         4,997  
               
Net increase in cash and cash equivalents       13,225         31,650  
Cash and cash equivalents, beginning of period     308,021         314,074  
               
Cash and cash equivalents, end of period   $   321,246     $   345,724  
               

 

For Further Information:
R. Troy Dewar, CFA
Director, Investor Relations
(203) 740-5610
tdewar@photronics.com

Primary Logo

 

Source: Photronics, Inc.