Press Release

Photronics Reports Third Quarter Fiscal 2019 Results

August 20, 2019 at 6:00 AM EDT
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  • Third quarter 2019 revenue was $138.1 million, up 5% sequentially and 1% year-over-year
  • Net income attributable to Photronics, Inc. shareholders was $6.3 million, or $0.10 per diluted share
  • Strong cash generation increased cash to $197 million, even as investments in China expansion continue
  • Fourth quarter 2019 guidance: revenue between $143 and $151 million with diluted EPS between $0.11 and $0.17

BROOKFIELD, Conn., Aug. 20, 2019 (GLOBE NEWSWIRE) -- Photronics, Inc. (NASDAQ:PLAB), a worldwide leader in photomask technologies and solutions, today reported financial results for its fiscal 2019 third quarter ended July 28, 2019.

Financial Results Summary
$ Millions, except per share data Q319 Q219 Q318 Q/Q Y/Y
Revenue 138.1 131.6 136.4 5% 1%
Integrated circuit (IC) revenue 100.2 98.6 107.2 2% (7%)
Flat panel display (FPD) revenue 37.9 33.0 29.1 15% 30%
Net income attributable to Photronics, Inc. shareholders 6.3 8.5 13.0 (25%) (51%)
Diluted earnings per share 0.10 0.13 0.18 (0.03) (0.08)

"We performed well during the third quarter of 2019, achieving record FPD revenue and delivering our eighth consecutive quarter of year-over-year revenue growth,” said Peter Kirlin, chief executive officer. “FPD revenue growth was driven by continued strength in AMOLED display for mobile applications and ramping shipments from our new China facility. IC revenue grew sequentially due to improved demand from Asian foundries for mainstream nodes. Gross and operating margins improved sequentially as we were able to control costs despite China startup activity. Our cash balance grew during the quarter, demonstrating our ability to generate cash as we continue to invest in China. We are on pace to have an outstanding year in 2019 and positioned to perform even better in 2020 and beyond.”

Fourth Quarter 2019 Guidance

For the fourth quarter of 2019, Photronics expects revenue to be between $143 million and $151 million, and net income attributable to Photronics, Inc. shareholders to be between $0.11 and $0.17 per diluted share.

Conference Call

A conference call to discuss these results is scheduled for 8:30 a.m. Eastern time on Tuesday, August 20, 2019. The call can be accessed by logging onto Photronics' website 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’ website for instant replay access.

About Photronics

Photronics is a leading worldwide manufacturer of integrated circuit (IC) and flat panel display (FPD) photomasks. High precision quartz plates that contain microscopic images of electronic circuits, photomasks are a key element in the IC and FPD manufacturing process. Founded in 1969, Photronics has been a trusted photomask supplier for 50 years. As of October 31, 2018, the company had 1,575 employees across 11 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 the company and its subsidiaries. The forward-looking statements contained in this press release 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, political, 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.  There is no assurance that the company’s expectations will be realized. For additional information please see the company’s quarterly and annual reports filed with the Securities and Exchange Commission. The company assumes no obligation to provide revisions to any forward-looking statements.

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

 

 
PHOTRONICS, INC. 
Condensed Consolidated Statements of Income
(in thousands, except per share amounts)
(Unaudited)
         
         
  Three Months Ended   Nine Months Ended
  July 28,   April 28,   July 29,   July 28,   July 29,
    2019      2019    2018    2019    2018
                   
Revenue $   138,112     $   131,580   $   136,391   $   394,404   $   390,616
                   
Cost of goods sold     107,542         105,570       100,794       311,721       294,538
                   
  Gross profit     30,570         26,010       35,597       82,683       96,078
                   
Operating Expenses:                  
                   
  Selling, general and administrative     13,124         13,269       12,504       40,186       37,891
                   
  Research and development     4,046         3,542       2,653       11,852       10,574
                   
Total Operating Expenses     17,170         16,811       15,157       52,038       48,465
                   
  Operating income      13,400         9,199       20,440       30,645       47,613
                   
Other income (expense), net     (348 )       3,931       1,411       4,692       637
                   
  Income before income taxes     13,052         13,130       21,851       35,337       48,250
                   
Income tax provision     3,218         3,278       2,054       7,883       3,783
                   
  Net income      9,834         9,852       19,797       27,454       44,467
                   
Net income attributable to noncontrolling interests     3,487         1,373       6,792       7,361       14,899
                   
Net income attributable to Photronics, Inc. shareholders $   6,347     $   8,479   $   13,005   $   20,093   $   29,568
                   
Earnings per share:                  
                   
  Basic $   0.10     $   0.13   $   0.19   $   0.30   $   0.43
                   
  Diluted $   0.10     $   0.13   $   0.18   $   0.30   $   0.41
                   
Weighted-average number of common shares outstanding:                  
                   
  Basic   66,313       66,261     69,374     66,386     69,141
                   
  Diluted   66,570       70,597     75,258     69,919     75,121
                   

 

PHOTRONICS, INC.  
Condensed Consolidated Balance Sheets  
(in thousands)  
(Unaudited)  
   
         
  July 28,   October 31,  
   2019    2018  
         
Assets        
         
Current assets:        
  Cash and cash equivalents $   197,243   $   329,277  
  Accounts receivable     134,369       120,515  
  Inventories     39,982       29,180  
  Other current assets     48,873       23,759  
         
     Total current assets     420,467       502,731  
         
Property, plant and equipment, net     636,743       571,781  
Intangible assets, net     9,013       12,368  
Other assets     47,972       23,129  
         
Total assets $   1,114,195   $   1,110,009  
         
         
         
Liabilities and Equity        
         
Current liabilities:        
  Debt $   6,100   $   57,453  
  Accounts payable and accrued liabilities     153,174       133,623  
         
     Total current liabilities     159,274       191,076  
         
Long-term debt     43,015       -   
Other liabilities     11,568       14,364  
         
Photronics, Inc. shareholders' equity      763,394       759,671  
Noncontrolling interests     136,944       144,898  
     Total equity     900,338       904,569  
         
Total liabilities and equity $   1,114,195   $   1,110,009  
         

 

PHOTRONICS,  INC.  
Condensed Consolidated Statements of Cash Flows  
(in thousands)  
(Unaudited)  
                 
                 
          Nine Months Ended  
          July 28,   July 29,  
           2019     2018   
                 
Cash flows from operating activities:          
  Net income        $   27,454     $   44,467    
  Adjustments to reconcile net income to net cash        
  provided by operating activities:          
     Depreciation and amortization        60,387         64,485    
     Changes in operating assets, liabilities and other     (64,337 )       (21,995 )  
                 
Net cash provided by operating activities       23,504         86,957    
                 
Cash flows from investing activities:          
  Purchases of property, plant and equipment     (160,149 )       (64,372 )  
  Government incentive         17,694         -     
  Other             (24 )       313   *
                 
Net cash used in investing activities       (142,479 )       (64,059 ) *
                 
Cash flows from financing activities:          
  Proceeds from debt         53,227         -     
  Contribution from noncontrolling interest     29,394         17,997    
  Repayments of debt         (61,319 )       (4,170 )  
  Dividends paid to noncontrolling interests     (26,102 )       (8,166 )  
  Purchase of treasury stock         (10,696 )       (6,787 )  
  Proceeds from share-based arrangements     1,314         4,028    
  Other             (92 )       (274 )  
                 
Net cash (used in) provided by financing activities     (14,274 )       2,628    
                 
Effect of exchange rate changes on cash, cash equivalents, and restricted cash      1,206         (975 ) *
                 
Net (decrease) increase in cash, cash equivalents, and restricted cash     (132,043 )       24,551   *
Cash, cash equivalents, and restricted cash, beginning of period     331,989   *     310,936   *
                 
Cash, cash equivalents, and restricted cash, end of period $   199,946     $   335,487   *
                 
* Amount has been modified to reflect the adoption of ASU 2016-18        
                 

 

 

 

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Source: Photronics, Inc.