Axcelis Announces Financial Results For Second Quarter 2017

August 3, 2017 at 4:02 PM EDT
Purion Platform Continues to Drive Strong Growth in Revenues, Operating Profit and Cash

BEVERLY, Mass., Aug. 3, 2017 /PRNewswire/ -- Axcelis Technologies, Inc. (Nasdaq: ACLS) today announced financial results for the second quarter ended June 30, 2017.

The Company reported second quarter revenue of $102.8 million, compared to $86.9 million for the first quarter of 2017. Operating profit for the quarter was $12.5 million, compared to $10.7 million in the first quarter. Net income for the quarter was $13.9 million, or $0.42 per diluted share, compared to net income for the first quarter of 2017 of $9.5 million, or $0.29 per diluted share. Total cash was $115.4 million at June 30, 2017, compared to $76.2 million on March 31, 2017.

In 2017, the Company adopted Accounting Standard Update No. 2016-09 (ASU 2016-09), which addresses accounting for equity compensation expense and related tax effects. In the second quarter, this new standard had a $2.8 million positive impact on our net income and a $0.09 positive impact on earnings per share. This accounting change has no impact on the Company's operating results or cash flow. Excluding the effect of ASU 2016-09, net income for the quarter would have been $11.1 million, or $0.33 per diluted share.

President and CEO Mary Puma commented, "The Purion platform continued to gain momentum during the quarter, driving robust financial performance and market share gains. The industry remains in a period of strong growth with increased spending in memory and IoT. We're very pleased that 2017 will be a strong year for Axcelis. With greater visibility into the second half, we now anticipate total 2017 revenues of approximately $380 million with market share between 26 and 28 percent, at the high end of our previous estimates."

Business Outlook
For the third quarter ending September 30, 2017, Axcelis expects revenues of approximately $95 million. Gross margin in the third quarter is expected to be approximately 38%. Third quarter operating profit is forecasted to be approximately $10-12 million with earnings per diluted share of $0.27-0.31, prior to any tax effect of ASU 2016-09. Total cash for the quarter is expected to be around $120 million.

Second Quarter 2017 Conference Call
The Company will host a conference call today at 5:00 pm ET to discuss the Company's results for the second quarter of 2017. The call will be available to interested listeners via an audio webcast on the Investors page of Axcelis' website at www.axcelis.com, or by dialing 866.588.8911 (707.294.1561 outside North America).  Participants calling into the conference call will be requested to provide the company name, Axcelis Technologies, and pass code: 44383784. Webcast replays will be available for 30 days following the call.

Use of Non-GAAP Financial Results
Adjusting net income to exclude the effects of income tax benefits and provisions of ASU 2016-09 is a non-GAAP financial measure. Since the Company is not a cash income tax payer in the US and ASU 2016-09 has had a significant impact on our reported net income in the second quarter, management will use adjusted net income and adjusted net income per diluted share to assist in our understanding of the Company's operating and financial performance. The Company believes the presentation of these non-GAAP results is useful to investors for analyzing business trends and comparing performance to prior periods, along with enhancing investors' ability to view the Company's results from management's perspective.  The presentation of supplemental non-GAAP information is not meant to be considered in isolation or as a substitute for results prepared and presented in accordance with GAAP.

Safe Harbor Statement
This press release and the conference call contain forward-looking statements under the SEC safe harbor provisions. These statements, which include our expectations for increased spending in our industry and guidance for future financial performance, are based on management's current expectations and should be viewed with caution. They are subject to various risks and uncertainties, many of which are outside the control of the Company, including the timing of orders and shipments, the conversion of orders to revenue in any particular quarter, or at all, the continuing demand for semiconductor equipment, relative market growth, continuity of business relationships with and purchases by major customers, competitive pressure on sales and pricing, increases in material and other production costs that cannot be recouped in product pricing and global economic, political and financial conditions. These risks and other risk factors relating to Axcelis are described more fully in the most recent Form 10-K filed by Axcelis and in other documents filed from time to time with the Securities and Exchange Commission.

About Axcelis:
Axcelis (Nasdaq: ACLS), headquartered in Beverly, Mass., has been providing innovative, high-productivity solutions for the semiconductor industry for over 35 years. Axcelis is dedicated to developing enabling process applications through the design, manufacture and complete life cycle support of ion implantation systems, one of the most critical and enabling steps in the IC manufacturing process. Learn more about Axcelis at www.axcelis.com.

Company Contacts

Investor Relations:
Doug Lawson
978.787.9552

Editorial/Media:
Maureen Hart
978.787.4266

Axcelis Technologies, Inc.

Consolidated Statements of Operations

(In thousands, except per share amounts)

(Unaudited)



Three months ended

June 30,

Six months ended

June 30,




2017

2016

2017

2016











Revenue:











Product

$

96,539

$

58,859

$

178,517

$

121,034

Services

6,251

5,592

11,166

10,938


Total revenue

102,790

64,451

189,683

131,972

Cost of Revenue:













Product

57,689

34,638

104,486

74,902

Services

6,039

4,682

11,421

8,523


Total cost of revenue

63,728

39,320

115,907

83,425















Gross profit

39,062

25,131

73,776

48,547















Operating expenses:











Research and development

11,256

8,478

21,151

17,114

Sales and marketing

7,485

5,790

14,534

11,750

General and administrative

7,791

6,232

14,848

12,274

Restructuring charges

—

—

—

282


Total operating expenses

26,532

20,500

50,533

41,420















Income from operations

12,530

4,631

23,243

7,127















Other (expense) income:













Interest income

111

54

180

108

Interest expense

(1,336)

(1,338)

(2,447)

(2,385)

Other, net

16

(238)

(138)

(297)


Total other expense

(1,209)

(1,522)

(2,405)

(2,574)















Income before income taxes

11,321

3,109

20,838

4,553












Income tax (benefit) provision

(2,611)

172

(2,600)

(332)












Net income

$

13,932

$

2,937

$

23,438

$

4,885















Net income per share:












Basic

$

0.46

$

0.10

$

0.78

$

0.17


Diluted

$

0.42

$

0.10

$

0.72

$

0.16















Shares used in computing net income per share:












Basic weighted average common shares

30,589

29,097

30,183

29,066


Diluted weighted average common shares

33,168

30,701

32,779

30,607
































 

 

Axcelis Technologies, Inc.
Consolidated Balance Sheets
(In thousands, except per share amounts)
(Unaudited)







June 30,

December 31,


2017

2016








ASSETS






Cash and cash equivalents

$

108,558

$

70,791

Accounts receivable, net

48,561

50,573

Inventories, net

122,574

113,853

Prepaid expenses and other assets

36,639

29,310

Property, plant and equipment, net

31,617

30,840

Restricted cash

6,793

6,864


Total assets

$

354,742

$

302,231









LIABILITIES AND STOCKHOLDERS' EQUITY






Accounts payable

$

27,606

$

24,996

Accrued compensation

12,170

5,142

Warranty

3,872

2,668

Income taxes

255

240

Deferred revenue

14,902

11,009

Sale leaseback obligation

47,692

47,586

Other liabilities

9,807

9,135


Total liabilities

116,304

100,776









Commitments and contingencies





Stockholders' equity:






Preferred stock, $0.001 par value, 30,000 shares authorized;
none issued or outstanding

—

—

Common stock, $0.001 par value, 75,000 shares authorized;
31,180 shares issued and outstanding at June 30, 2017; 29,518
shares issued and outstanding at December 31, 2016

31

30

Additional paid-in capital

546,491

535,408

Accumulated deficit

(308,266)

(331,704)

Accumulated other comprehensive income (loss)

182

(2,279)


Total stockholders' equity

238,438

201,455


Total liabilities and stockholders' equity

$

354,742

$

302,231












 

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SOURCE Axcelis Technologies, Inc.