Amtech Systems: Q2 results
TEMPE, Arizona - Amtech Systems, Inc. (ASYS), a global supplier of production equipment and related supplies for the solar, semiconductor, and LED markets, reported results for its second fiscal quarter ending March 31, 2015.
Second Quarter Fiscal 2015 Financial and Operational Highlights:
Successful close of BTU acquisition
Integration of BTU and SoLayTec progressing as planned
Cost synergies on target
Customer orders of $30.9 million (solar $15.8 million)
Quarter-end backlog of $56.0 million (solar $41.4 million)
Net revenue of $24.3 million (solar $7.9 million)
Book to bill ratio of 1.2:1 (solar 1.9:1)
Net loss of $2.3 million, or $0.19 per share
Mr. Fokko Pentinga, Chief Executive Officer of Amtech, commented, "We made much progress in the quarter including the successful close of the BTU acquisition and the integration of both BTU and SoLayTec is progressing according to plan. Bookings continued at a healthy rate in the quarter and our backlog is at the highest level in the last three years. The mix of product in our backlog, including PECVD, ion implant, and atomic layer deposition systems (ALD), is a direct result of our decision several years ago to invest in expanding the size of our served available markets through product development and acquisition. Global solar installations continue to grow and the balance between supply and demand continues to improve. With strong growth of the market in 2015 and beyond, we see an increase in activity among top tier solar cell manufacturers to expand production both inside and outside of China and we are pleased to fully participate in the industry's selective capacity expansion and technology adaptation."
Customer orders in the second quarter of fiscal 2015 were $30.9 million ($15.8 million solar), compared to $30.0 million ($21.1 million solar) in the preceding quarter and $21.5 million ($13.6 million solar) in the second quarter of fiscal 2014.
At March 31, 2015, the Company's total order backlog was $56.0 million (solar $41.4 million), compared to total backlog of $48.3 million (solar $37.5 million) at December 31, 2014. Backlog includes deferred revenue and customer orders that are expected to ship within the next 12 months.
Net revenue for the second quarter of fiscal 2015 was $24.3 million compared to $12.4 million in the preceding quarter and $12.7 million in the second quarter of fiscal 2014. The increase is due primarily to higher solar revenues and the inclusion of BTU revenues since January 30, 2015.
Gross margin in the second quarter of fiscal 2015 was 28%, compared to 28% in the preceding quarter and 23% in the second quarter of fiscal 2014. The higher margin compared to a year ago resulted primarily from inclusion of BTU's gross margin since the acquisition date and higher volumes in the company's other semiconductor business.
Selling, general and administrative (SG&A) expenses in the second quarter of fiscal 2015 were $8.1 million compared to $6.4 million in the preceding quarter and $5.3 million in the second quarter of fiscal 2014. The increase results primarily from inclusion of BTU's SG&A since January 30, 2015, and acquisition related expenses. Partially offsetting the increase is a decrease in bad debt expense.
Research, development and engineering (RD&E) expense was $0.8 million in the second quarter of fiscal 2015 compared to $1.8 million in the preceding quarter and $2.2 million in the second quarter of fiscal 2014. The lower RD&E expense is primarily due to an increase in the recognition of government grant funding, partially offset by increases in spending resulting from inclusion of BTU and SoLayTec RD&E since acquisition.
Depreciation and amortization in the second quarter of fiscal 2015 was $937,000, compared to $705,000 in the preceding quarter and $583,000 in the second quarter of fiscal 2014. The increase is primarily due to the acquisitions of BTU and SoLayTec.
Income tax expense was $170,000 for the three months ended March 31, 2015 compared to $180,000 in the preceding quarter. In the second quarter of fiscal 2014, income tax expense was approximately zero, due to the effect of book/tax differences and valuation allowances on net operating losses in certain tax jurisdictions in which the company operates.
The net loss for the second quarter of fiscal 2015 was $2.3 million, or $0.19 per share, compared to a net loss of $5.2 million or $0.53 per share in the preceding quarter and a net loss of $3.8 million, or $0.39 per share for the second quarter of fiscal 2014.
Unrestricted cash and cash equivalents at March 31, 2015 were $32.6 million, compared to $28.6 million at December 31, 2014. The increase in cash and cash equivalents is primarily due to the cash acquired in the BTU acquisition.
The company expects revenues for the quarter ending June 30, 2015 to be in the range of $33 to $35 million. Gross margin for the quarter ending June 30, 2015, is expected to be in the high 20s percent range, negatively influenced by anticipated revenue deferrals due to higher shipment levels, with operating margin slightly negative.
Operating results could be impacted by the timing of system shipments, the net impact of revenue deferral on those shipments, and recognition of revenue based on customer acceptances, all of which can have a significant effect on operating results. Operating results could also be significantly impacted by the timing of recognition of government grant revenue related to research and development projects in China and The Netherlands.
A substantial portion of Amtech's revenues are denominated in Euros. The revenue outlook provided in this press release is based on an assumed exchange rate between the United States Dollar and the Euro. A significant decrease in the value of the Euro in relation to the United States Dollar could cause actual revenues to be lower than anticipated.
About Amtech Systems, Inc.
Amtech Systems, Inc. is a global supplier of advanced thermal processing equipment to the solar, semiconductor / electronics, and LED manufacturing markets. Amtech's equipment includes diffusion, ALD and PECVD systems, ion implanters, and solder reflow systems. Amtech also supplies wafer handling automation and polishing equipment and related consumable products. The Company's wafer handling, thermal processing and consumable products currently address the diffusion, oxidation, and deposition steps used in the fabrication of solar cells, LEDs, semiconductors, MEMS, printed circuit boards, semiconductor packaging, and the polishing of newly sliced sapphire and silicon wafers. Amtech's products are recognized under the leading brand names Tempress SystemsTM, Bruce TechnologiesTM, PR HoffmanTM, R2D AutomationTM, Kingstone Semiconductor, SoLayTec, and BTU International.
Amtech Systems, Inc.
Bradley C. Anderson
Chief Financial Officer