SOURCE: Photronics, Inc.

Photronics, Inc.

February 14, 2018 06:00 ET

Photronics Reports First Quarter Fiscal 2018 Results

BROOKFIELD, CT--(Marketwired - February 14, 2018) -

  • First quarter 2018 revenue was $123.4 million, up 2% sequentially and 12% year-over-year
  • Net income attributable to Photronics, Inc. shareholders was $5.9 million ($0.09 per diluted share)
  • Balance sheet strengthened as cash balance increased $40.5 million to $348.6 million
  • Second quarter 2018 guidance: revenue between $120 and $128 million with diluted EPS between $0.04 and $0.09

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 first quarter ended January 28, 2018.

First quarter revenue was $123.4 million, increases of 2% sequentially and 12% compared with same quarter prior year. Integrated circuit (IC) revenue was $95.7 million, essentially flat sequentially and up 11% compared with last year. Flat panel display (FPD) revenue was $27.8 million, up 11% sequentially and 19% compared with last year.

Net income attributable to Photronics, Inc. shareholders was $5.9 million ($0.09 per diluted share), compared with $5.4 million ($0.08 per diluted share) for the fourth quarter of 2017 and $1.9 million ($0.03 per diluted share) for the first quarter of 2017.

"We achieved another quarter of solid revenue growth, despite seasonal headwinds, due to continued strength in high-end IC demand, and overall improvement in FPD," said Peter Kirlin, chief executive officer. "High-end IC improved primarily due to logic demand from Asia foundry customers, where tape-out activity remains robust. FPD demand for new LCD panels was strong as customers released new designs to improve factory utilization. Operating expenses were slightly higher sequentially as adjustments recognized in the previous quarter did not recur; operating margin was 9.6% compared with 10.3% in the previous quarter. Below the operating income line, a foreign exchange loss of $2.7 million, net of tax and non-controlling interest, and tax benefits of $4.2 million resulted in net income of $5.9 million. Our balance sheet strengthened during the quarter, with cash balance growing to $348.6 million on strong operating cash flow and the initial contribution from our partner for the PDMCX joint venture in China."

Second Quarter 2018 Guidance

Kirlin continued, "For the second quarter of 2018, we expect revenue to be between $120 million and $128 million, and net income attributable to Photronics, Inc. shareholders to be between $0.04 and $0.09 per diluted share."

Conference Call

A conference call to discuss these results is scheduled for 8:30 a.m. Eastern time on Wednesday, February 14, 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. AND SUBSIDIARIES  
Condensed Consolidated Statements of Income  
(in thousands, except per share amounts)  
(Unaudited)  
   
   
   Three Months Ended  
   January 28,   October 29,   January 29,  
   2018   2017   2017  
                 
Revenue  $123,446   $120,971   $109,831  
                 
Cost of goods sold   (95,784 )  (94,529 )  (86,832 )
                 
  Gross profit   27,662    26,442    22,999  
                 
Operating Expenses:                
                 
 Selling, general and administrative   (11,750 )  (10,182 )  (10,871 )
                 
 Research and development   (4,104 )  (3,838 )  (3,485 )
                 
Total Operating Expenses   (15,854 )  (14,020 )  (14,356 )
                 
  Operating income   11,808    12,422    8,643  
                 
Other (expense) income, net   (4,105 )  536    (2,083 )
                 
  Income before income taxes   7,703    12,958    6,560  
                 
Income tax benefit (provision)   1,778    (2,462 )  (2,050 )
                 
  Net income   9,481    10,496    4,510  
                 
Net income attributable to noncontrolling interests   (3,583 )  (5,110 )  (2,564 )
                 
Net income attributable to Photronics, Inc. shareholders  $5,898   $5,386   $1,946  
                 
Earnings per share:                
                 
  Basic  $0.09   $0.08   $0.03  
                 
  Diluted  $0.09   $0.08   $0.03  
                 
Weighted-average number of common shares outstanding:                
                 
  Basic   68,755    68,615    68,176  
                 
  Diluted   69,372    69,218    69,169  
               
 
 
PHOTRONICS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
 
       
   January 28,  October 29,
   2018  2017
         
Assets        
         
Current assets:        
 Cash and cash equivalents  $348,560  $308,021
 Accounts receivable   104,638   105,320
 Inventories   26,997   23,703
 Other current assets   12,162   12,080
          
  Total current assets   492,357   449,124
         
Property, plant and equipment, net   548,307   535,197
Intangible assets, net   16,224   17,122
Other assets   24,568   19,351
         
Total assets  $1,081,456  $1,020,794
         
         
         
Liabilities and Equity        
         
Current liabilities:        
 Current portion of long-term borrowings  $3,259  $4,639
 Accounts payable and accrued liabilities   84,814   77,137
          
  Total current liabilities   88,073   81,776
         
Long-term borrowings   57,366   57,337
Other liabilities   17,570   16,386
         
Photronics, Inc. shareholders' equity   777,433   744,564
Noncontrolling interests   141,014   120,731
  Total equity   918,447   865,295
         
Total liabilities and equity  $1,081,456  $1,020,794
       
   
   
PHOTRONICS, INC. AND SUBSIDIARIES  
Condensed Consolidated Statements of Cash Flows  
(in thousands)  
(Unaudited)  
          
          
   Three Months Ended  
   January 28,   January 29,  
   2018   2017  
            
Cash flows from operating activities:           
 Net income  $9,481   $4,510  
 Adjustments to reconcile net income to net cash provided by operating activities:           
  Depreciation and amortization   22,363    20,896  
  Changes in operating assets, liabilities and other   (982 )  6,133  
            
Net cash provided by operating activities   30,862    31,539  
            
Cash flows from investing activities:           
  Purchases of property, plant and equipment   (10,995 )  (9,600 )
  Acquisition of business   -    (5,400 )
  Other   (134 )  (396 )
            
Net cash used in investing activities   (11,129 )  (15,396 )
            
Cash flows from financing activities:           
  Repayments of long-term borrowings   (1,381 )  (1,343 )
  Contribution from noncontrolling interest   11,998    -  
  Proceeds from share-based arrangements   798    1,113  
  Other   (261 )  (16 )
            
Net cash provided by (used in) financing activities   11,154    (246 )
            
Effect of exchange rate changes on cash   9,652    (275 )
            
Net increase in cash and cash equivalents   40,539    15,622  
Cash and cash equivalents, beginning of period   308,021    314,074  
            
Cash and cash equivalents, end of period  $348,560   $329,696  
         

Contact Information

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