BusinessWire

Amtech Reports Third Quarter Fiscal 2020 Results

TEMPE, Ariz.,--(BUSINESS WIRE)--Amtech Systems, Inc. (NASDAQ: ASYS), a manufacturer of capital equipment, including thermal processing and wafer polishing, and related consumables used in fabricating semiconductor devices, such as silicon carbide (SiC) and silicon power chips, electronic assemblies and light-emitting diodes (LEDs), today reported results for its third quarter ended June 30, 2020.

Third Quarter Fiscal 2020 Financial and Operational Highlights from Continuing Operations:

  • Net revenue of $15.2 million
  • Breakeven operating income of $31,000
  • Loss from continuing operations, net of tax, of $0.1 million
  • Loss per diluted share from continuing operations of $0.01
  • Customer orders of $10.8 million
  • Unrestricted cash of $46.4 million

Mr. Michael Whang, Chief Executive Officer of Amtech, commented, “While the global pandemic continues to create operational challenges, thanks to the diligent efforts of our employees and supply chain partners, in the third quarter we saw minimal disruption in our ability to service customers. In the fourth quarter, we began to see a rise in customer engagement with our recently announced 300mm diffusion furnace order. We believe this is an early indicator of the strength in long-term demand drivers for power semiconductors, including silicon carbide, led by growing demand from electric vehicles and automotive sensors, renewable energy, mobile devices, and wireless communications applications,” concluded Mr. Whang.

GAAP Financial Results

(in millions, except per share amounts)

Q3

Q2

Q3

9 Months

9 Months

 

FY
2020

FY
2020

FY
2019

2020

2019

Net revenues

$

15.2

 

$

14.5

 

$

21.0

 

$

50.4

 

$

64.9

 

Gross profit

$

6.0

 

$

5.4

 

$

7.9

 

$

19.5

 

$

24.8

 

Gross margin

 

39

%

 

37

%

 

37

%

 

39

%

 

38

%

Operating income (loss)

$

0.0

 

$

(1.0

)

$

1.4

 

$

0.7

 

$

3.3

 

Operating margin

 

0.2

%

 

-6.7

%

 

6.4

%

 

1.4

%

 

5.0

%

(Loss) income from continuing operations, net of tax

$

(0.1

)

$

(0.5

)

$

0.9

 

$

(1.9

)

$

2.2

 

Diluted (loss) income per share from continuing operations

$

(0.01

)

$

(0.04

)

$

0.06

 

$

(0.13

)

$

0.15

 

Net revenues increased 5% sequentially and decreased 28% from the third quarter of fiscal 2019. Semiconductor and SiC/LED revenue in fiscal Q3 2020 increased sequentially due primarily to our Shanghai facility returning to normal operations after the extended Chinese New Year in fiscal Q2 and increased consumable and machine shipments in our SiC/LED segment. Semiconductor and SiC/LED revenue decreased compared to the third quarter of fiscal 2019 primarily due to global COVID-19 impacts on our customers.

Gross margin increased in the third quarter of fiscal 2020 both sequentially and compared to the same prior year period, primarily due to favorable product mix.

Selling, General & Administrative (“SG&A”) expenses decreased $0.6 million sequentially due primarily to payroll tax credits the Company was able to claim as part of the COVID-19 legislation passed by U.S. Congress, the CARES Act. SG&A decreased $0.9 million compared to the same prior year period due primarily to the payroll tax credits, not having our former Automation segment included in our results, and lower travel due to the COVID-19 pandemic.

Relocation and R&D expenses that were expected in the quarter shifted into the fourth quarter of fiscal 2020 due to shutdowns and delays resulting from the COVID-19 pandemic. Operating results were breakeven, primarily from lower SG&A in the quarter, compared to operating loss of $1.0 million in the second quarter of fiscal 2020 and $1.4 million of operating income in the same prior year period.

Loss from continuing operations, net of tax, for the third quarter of fiscal 2020 was $0.1 million, or 1 cent per share. This compares to income from continuing operations of $0.9 million, or 6 cents per share, for the third quarter of fiscal 2019 and loss of $0.5 million, or 4 cents per share, in the preceding quarter.

Outlook

Our outlook reflects the anticipated ongoing impacts from the COVID-19 pandemic as we understand them today; however, given how fluid the situation is both for our own business as well as for that of our customers and supply chain, we would like to remind investors that actual results may differ materially in the weeks and months ahead. Additionally, the semiconductor equipment industries can be cyclical and inherently impacted by changes in market demand. Operating results can be significantly impacted, positively or negatively, by the timing of orders, system shipments, and the financial results of semiconductor manufacturers.

For our fourth fiscal quarter ending September 30, 2020, revenues are expected to be in the range of $13.0 to $15.0 million. Gross margin for the quarter ending September 30, 2020 is expected to be in the mid 30% range, with negative operating margin, primarily due to one-time moving costs for our SiC/LED segment to relocate into their new building and an increase in R&D related to new product development.

A portion of Amtech's results are denominated in Renminbis, a Chinese currency. The outlook provided in this press release is based on an assumed exchange rate between the United States Dollar and the Renminbi. Changes in the value of the Renminbi in relation to the United States Dollar could cause actual results to differ from expectations.

Conference Call

Amtech Systems will host a conference call today at 5:00 p.m. ET to discuss our fiscal third quarter financial results. The call will be available to interested parties by dialing 800-430-8332. For international callers, please dial +1 323-347-3612. The Conference ID number is 9393233. The call will be webcast and available in the Investor Relations section of Amtech’s website at: http://www.amtechsystems.com/conference.htm.

A replay of the webcast will be available in the Investor Relations section of the company’s web site at http://www.amtechsystems.com/conference.htm shortly after the conclusion of the call and will remain available for approximately 30 calendar days.

About Amtech Systems, Inc.

Amtech Systems, Inc. is a leading, global manufacturer of capital equipment, including thermal processing and wafer polishing, and related consumables used in fabricating semiconductor devices, such as silicon carbide (SiC) and silicon power chips, electronic assemblies and light-emitting diodes (LEDs). We sell these products to semiconductor and automotive component manufacturers worldwide, particularly in Asia, North America and Europe. Our strategic focus is on semiconductor growth opportunities in power electronics, leveraging our strength in our core competencies in thermal and substrate processing. We are a market leader in the high-end power chip market (SiC and 300mm silicon horizontal thermal reactor), developing and supplying essential equipment and consumables used in the semiconductor industry. Amtech's products are recognized under the leading brand names BTU International, Bruce Technologies™, and PR Hoffman™.

Cautionary Note Regarding Forward-Looking Statements

Certain information contained in this press release is forward-looking in nature. All statements in this press release, or made by management of Amtech Systems, Inc. and its subsidiaries ("Amtech"), other than statements of historical fact, are hereby identified as "forward-looking statements" (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995). The forward-looking statements in this press release relate only to events or information as of the date on which the statements are made in this press release. Examples of forward-looking statements include statements regarding Amtech's future financial results, operating results, business strategies, projected costs, products under development, competitive positions, plans and objectives of Amtech and its management for future operations, efforts to improve operational efficiencies and effectiveness and profitably grow our revenue, the planned divestiture of our solar business, and enhancements to our technologies and expansion of our product portfolio. In some cases, forward-looking statements can be identified by terminology such as "may," "plan," "anticipate," "seek," "will," "expect," "intend," "estimate," "anticipate," "believe," "continue," "predict," "potential," "project," "should," "would," "could", "likely," "future," "target," "forecast," "goal," "observe," and "strategy" or the negative of these terms or other comparable terminology used in this press release or by our management, which are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. The Form 10-K that Amtech filed with the Securities and Exchange Commission (the "SEC") for the year-ended September 30, 2019, listed various important factors that could affect the Company's future operating results and financial condition and could cause actual results to differ materially from historical results and expectations based on forward-looking statements made in this document or elsewhere by Amtech or on its behalf. These factors can be found under the heading "Risk Factors" in the Form 10-K and investors should refer to them. Because it is not possible to predict or identify all such factors, any such list cannot be considered a complete set of all potential risks or uncertainties. Except as required by law, we undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events, or otherwise.

AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
August 6, 2020
(Unaudited)

Summary Financial Information for Continuing Operations
(in thousands, except percentages and ratios)

 

 

Three Months Ended

 

 

Nine Months Ended June 30,

 

 

June 30,
2020

 

March 31,
2020

 

June 30,
2019

 

 

2020

 

2019

Amtech Systems, Inc.

 

 

 

 

 

 

 

 

 

 

 

Revenues, net of returns and allowances

 

$

15,227

 

 

$

14,460

 

 

$

21,003

 

 

 

$

50,379

 

 

$

64,861

 

Gross profit

 

$

5,951

 

 

$

5,358

 

 

$

7,850

 

 

 

$

19,483

 

 

$

24,797

 

Gross margin

 

 

39

%

 

 

37

%

 

 

37

%

 

 

 

39

%

 

 

38

%

Operating income (loss)

 

$

31

 

 

$

(972

)

 

$

1,351

 

 

 

$

696

 

 

$

3,263

 

New orders

 

$

10,830

 

 

$

20,626

 

 

$

16,278

 

 

 

$

49,081

 

 

$

56,216

 

Backlog

 

$

15,221

 

 

$

19,618

 

 

$

17,237

 

 

 

$

15,221

 

 

$

17,237

 

Semiconductor Segment

 

 

 

 

 

 

 

 

 

 

 

Revenues, net of returns and allowances

 

$

12,357

 

 

$

11,992

 

 

$

16,254

 

 

 

$

41,581

 

 

$

51,267

 

Gross profit

 

$

4,953

 

 

$

4,413

 

 

$

6,566

 

 

 

$

16,552

 

 

$

20,499

 

Gross margin

 

 

40

%

 

 

37

%

 

 

40

%

 

 

 

40

%

 

 

40

%

Operating income (loss)

 

$

1,058

 

 

$

(18

)

 

$

1,951

 

 

 

$

3,762

 

 

$

6,428

 

New orders

 

$

8,356

 

 

$

17,019

 

 

$

12,899

 

 

 

$

40,469

 

 

$

44,462

 

Backlog

 

$

13,798

 

 

$

17,799

 

 

$

13,931

 

 

 

$

13,798

 

 

$

13,931

 

SiC/LED Segment

 

 

 

 

 

 

 

 

 

 

 

Revenues, net of returns and allowances

 

$

2,870

 

 

$

2,468

 

 

$

3,074

 

 

 

$

8,155

 

 

$

9,330

 

Gross profit

 

$

998

 

 

$

945

 

 

$

1,038

 

 

 

$

2,922

 

 

$

3,524

 

Gross margin

 

 

35

%

 

 

38

%

 

 

34

%

 

 

 

36

%

 

 

38

%

Operating income

 

$

241

 

 

$

421

 

 

$

607

 

 

 

$

1,196

 

 

$

2,253

 

New orders

 

$

2,474

 

 

$

3,607

 

 

$

2,697

 

 

 

$

8,612

 

 

$

9,574

 

Backlog

 

$

1,423

 

 

$

1,819

 

 

$

2,934

 

 

 

$

1,423

 

 

$

2,934

 

AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
August 6, 2020
(Unaudited)

Condensed Consolidated Statements of Operations
(in thousands, except per share data)

 

 

Three Months Ended June 30,

 

 

Nine Months Ended June 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Revenues, net of returns and allowances

 

$

15,227

 

 

$

21,003

 

 

$

50,379

 

 

$

64,861

 

Cost of sales

 

 

9,276

 

 

 

13,153

 

 

 

30,896

 

 

 

40,064

 

Gross profit

 

 

5,951

 

 

 

7,850

 

 

 

19,483

 

 

 

24,797

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

4,804

 

 

 

5,718

 

 

 

16,134

 

 

 

18,137

 

Research, development and engineering

 

 

899

 

 

 

746

 

 

 

2,436

 

 

 

2,325

 

Restructuring charges

 

 

217

 

 

 

35

 

 

 

217

 

 

 

1,072

 

Operating income

 

 

31

 

 

 

1,351

 

 

 

696

 

 

 

3,263

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss on sale of subsidiary

 

 

 

 

 

 

 

 

(2,793

)

 

 

 

Interest (expense) income and other, net

 

 

(13

)

 

 

249

 

 

 

512

 

 

 

511

 

Income (loss) from continuing operations before

income taxes

 

 

18

 

 

 

1,600

 

 

 

(1,585

)

 

 

3,774

 

Income tax provision

 

 

90

 

 

 

707

 

 

 

297

 

 

 

1,621

 

(Loss) income from continuing operations, net of tax

 

 

(72

)

 

 

893

 

 

 

(1,882

)

 

 

2,153

 

Income (loss) from discontinued operations, net of tax

 

 

 

 

 

1,154

 

 

 

(11,816

)

 

 

(8,113

)

Net (loss) income

 

$

(72

)

 

$

2,047

 

 

$

(13,698

)

 

$

(5,960

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) Income Per Basic Share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic (loss) income per share from continuing

operations

 

$

(0.01

)

 

$

0.06

 

 

$

(0.13

)

 

$

0.15

 

Basic income (loss) per share from discontinued

operations

 

$

 

 

$

0.08

 

 

$

(0.83

)

 

$

(0.57

)

Net (loss) income per basic share

 

$

(0.01

)

 

$

0.14

 

 

$

(0.96

)

 

$

(0.42

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) Income Per Diluted Share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted (loss) income per share from continuing

operations

 

$

(0.01

)

 

$

0.06

 

 

$

(0.13

)

 

$

0.15

 

Diluted income (loss) per share from discontinued

operations

 

$

 

 

$

0.08

 

 

$

(0.83

)

 

$

(0.57

)

Net (loss) income per diluted share

 

$

(0.01

)

 

$

0.14

 

 

$

(0.96

)

 

$

(0.42

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - basic

 

 

14,155

 

 

 

14,245

 

 

 

14,195

 

 

 

14,231

 

Weighted average shares outstanding - diluted

 

 

14,155

 

 

 

14,316

 

 

 

14,195

 

 

 

14,267

 

AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
August 6, 2020
(Unaudited)

Condensed Consolidated Balance Sheets
(in thousands, except share data)

 

 

June 30,
2020

 

September 30,
2019

Assets

 

 

 

 

Current Assets

 

 

 

 

Cash and cash equivalents

 

$

46,436

 

 

$

52,982

 

Restricted cash

 

 

 

 

 

101

 

Accounts receivable (less allowance for doubtful accounts of $138 and $172 at

June 30, 2020, and September 30, 2019, respectively)

 

 

10,297

 

 

 

12,873

 

Inventories

 

 

19,385

 

 

 

17,532

 

Notes and other receivables

 

 

1,250

 

 

 

 

Income taxes receivable

 

 

150

 

 

 

 

Held-for-sale assets

 

 

 

 

 

22,755

 

Other current assets

 

 

3,066

 

 

 

2,027

 

Total current assets

 

 

80,584

 

 

 

108,270

 

Property, Plant and Equipment - Net

 

 

10,438

 

 

 

10,217

 

Right-of-Use Assets - Net

 

 

5,162

 

 

 

 

Intangible Assets - Net

 

 

674

 

 

 

870

 

Goodwill - Net

 

 

6,633

 

 

 

6,633

 

Other Assets

 

 

565

 

 

 

487

 

Total Assets

 

$

104,056

 

 

$

126,477

 

Liabilities and Shareholders’ Equity

 

 

 

 

Current Liabilities

 

 

 

 

Accounts payable

 

$

3,933

 

 

$

4,371

 

Accrued compensation and related taxes

 

 

1,983

 

 

 

2,717

 

Accrued warranty expense

 

 

401

 

 

 

556

 

Other accrued liabilities

 

 

1,478

 

 

 

1,274

 

Current maturities of long-term debt

 

 

376

 

 

 

371

 

Contract liabilities

 

 

1,645

 

 

 

1,378

 

Income taxes payable

 

 

 

 

 

1,434

 

Held-for-sale liabilities

 

 

 

 

 

18,547

 

Total current liabilities

 

 

9,816

 

 

 

30,648

 

Long-Term Debt

 

 

4,894

 

 

 

5,178

 

Long-Term Lease Liability

 

 

5,088

 

 

 

 

Income Taxes Payable

 

 

2,007

 

 

 

3,199

 

Total Liabilities

 

 

21,805

 

 

 

39,025

 

Commitments and Contingencies

 

 

 

 

Shareholders’ Equity

 

 

 

 

Preferred stock; 100,000,000 shares authorized; none issued

 

 

 

 

 

 

Common stock; $0.01 par value; 100,000,000 shares authorized; shares

issued and outstanding: 14,048,172 and 14,268,797 at June 30, 2020

and September 30, 2019, respectively

 

 

140

 

 

 

143

 

Additional paid-in capital

 

 

124,289

 

 

 

125,098

 

Accumulated other comprehensive loss

 

 

(1,792

)

 

 

(11,233

)

Retained deficit

 

 

(40,386

)

 

 

(26,556

)

Total shareholders’ equity

 

 

82,251

 

 

 

87,452

 

Total Liabilities and Shareholders’ Equity

 

$

104,056

 

 

$

126,477

 

AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
August 6, 2020
(Unaudited)

Condensed Consolidated Statements of Cash Flows
(in thousands)

 

 

Nine Months Ended June 30,

 

 

2020

 

2019

Operating Activities

 

 

 

 

Net loss

 

$

(13,698

)

 

$

(5,960

)

Adjustments to reconcile net loss to net cash (used in) provided by

operating activities:

 

 

 

 

Depreciation and amortization

 

 

932

 

 

 

1,280

 

Write-down of inventory

 

 

540

 

 

 

2,991

 

Deferred income taxes

 

 

784

 

 

 

192

 

Non-cash share-based compensation expense

 

 

257

 

 

 

474

 

Loss (gain) on sales of subsidiaries

 

 

13,708

 

 

 

(1,614

)

(Reversal of) provision for allowance for doubtful accounts, net

 

 

(26

)

 

 

1,104

 

Other, net

 

 

13

 

 

 

107

 

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable

 

 

2,356

 

 

 

630

 

Inventories

 

 

(2,791

)

 

 

284

 

Other assets

 

 

(2,376

)

 

 

12,675

 

Accounts payable

 

 

(2,363

)

 

 

(3,843

)

Accrued income taxes

 

 

(2,722

)

 

 

(1,359

)

Accrued and other liabilities

 

 

5,346

 

 

 

(5,726

)

Contract liabilities

 

 

(950

)

 

 

(814

)

Net cash (used in) provided by operating activities

 

 

(990

)

 

 

421

 

Investing Activities

 

 

 

 

Purchases of property, plant and equipment

 

 

(860

)

 

 

(552

)

Net cash disposed of in sales of subsidiaries

 

 

(9,940

)

 

 

(1,112

)

Net cash used in investing activities

 

 

(10,800

)

 

 

(1,664

)

Financing Activities

 

 

 

 

Proceeds from the exercise of stock options

 

 

799

 

 

 

175

 

Repurchase of common stock

 

 

(2,000

)

 

 

 

Payments on long-term debt

 

 

(285

)

 

 

(280

)

Borrowings on long-term debt

 

 

 

 

 

9

 

Net cash used in financing activities

 

 

(1,486

)

 

 

(96

)

Effect of Exchange Rate Changes on Cash, Cash Equivalents and

Restricted Cash

 

 

578

 

 

 

(1,450

)

Net Decrease in Cash, Cash Equivalents and Restricted Cash

 

 

(12,698

)

 

 

(2,789

)

Cash, Cash Equivalents and Restricted Cash, Beginning of Period*

 

 

59,134

 

 

 

62,496

 

Cash, Cash Equivalents and Restricted Cash, End of Period*

 

$

46,436

 

 

$

59,707

 

* Includes Cash, Cash Equivalents and Restricted Cash that are included in Held-For-Sale Assets on the Condensed Consolidated Balance Sheets for periods prior to January 22, 2020.


Contacts

Amtech Systems, Inc.
Lisa D. Gibbs
Chief Financial Officer
(480) 967-5146
irelations@amtechsystems.com

Sapphire Investor Relations, LLC
Erica Mannion and Mike Funari
(617) 542-6180
irelations@amtechsystems.com