Axcelis Announces Financial Results For Fourth Quarter And Full Year 2019

Company Reports 94% Increase in Fourth Quarter System Revenues

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Feb 05, 2020, 16:01 ET

BEVERLY, Mass., Feb. 5, 2020 /PRNewswire/ -- Axcelis Technologies, Inc. (Nasdaq: ACLS) today announced financial results for the fourth quarter and full year ended December 31, 2019.

The Company reported fourth quarter revenue of $107.7 million, compared to $69.5 million for the third quarter of 2019. Operating profit for the quarter was $13.2 million, compared to $1.9 million for the third quarter. Net income for the quarter was $9.7 million, or $0.29 per diluted share, compared to net income for the third quarter of $0.7 million, or $0.02 per diluted share. Gross margin for the quarter was 41.1%, compared to 44% in the third quarter. Cash, cash equivalents and restricted cash were $146.5 million on December 31, 2019, compared to $162.2 million on September 30, 2019.

For the full year 2019, the Company reported revenue of $343.0 million, compared with $442.6 million for the full year 2018. Systems revenue for the year was $202.6 million, compared to $280.4 million in 2018. Operating profit was $24.2 million in 2019, compared to $60 million in 2018. Net income for the year was $17 million with diluted earnings per share of $0.50. This compares to 2018 net income of $45.9 million and earnings per diluted share of $1.35.

President and CEO Mary Puma commented, "In 2019 we continued to expand the Purion installed base, growing our large and diverse group of customers in key market segments. We extended our Purion product line with the launch of four new Purion implanters specifically targeted at these segments, while maintaining tight control of operating expenses. This allowed us to remain profitable through the cycle, deliver annual gross margins of 42.0%, sustain a healthy balance sheet, and institute a share repurchase program. Exiting the year with a 94% increase in system revenues in the fourth quarter demonstrates our strong competitive position as we enter what is expected to be an extended growth period driven by 5G."

Business Outlook
For the first quarter ending March 31, 2020, Axcelis expects revenues of approximately $115 million. Gross margin in the first quarter is expected to be around 37%, impacted by the planned closure of three evaluation systems in the quarter. First quarter operating profit is forecasted to be approximately $9.5 million. Earnings per diluted share is expected to be approximately $0.21.

Fourth Quarter and Full Year 2019 Conference Call
The Company will host a call to discuss the results for the fourth quarter and full year 2019 on Thursday, February 6, 2020 at 8:30 am ET. The call will be available to interested listeners via an audio webcast that can be accessed through 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 Conference ID: 3972885. Webcast replays will be available for 30 days following the call.

Safe Harbor Statement
This press release and the conference call contain forward-looking statements under the Private Securities Litigation Reform Act safe harbor provisions. These statements, which include our expectations for 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 that could cause actual results to differ materially from those in the forward-looking statements, many of which are outside the control of the Company, including that customer decisions to place orders or our product shipments may not occur when we expect, that orders may not be converted to revenue in any particular quarter, or at all, whether demand will continue for the semiconductor equipment we produce or, if not, whether we can successfully meet changing market requirements, and whether we will be able to maintain continuity of business relationships with and purchases by major customers. Increased competitive pressure on sales and pricing, increases in material and other production costs that cannot be recouped in product pricing and instability caused by changing global economic, political or financial conditions could also cause actual results to differ materially from those in our forward-looking statements. 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 40 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				Twelve months ended
		December 31,			December 31,
	2019		2018		2019		2018
Revenue:
Product	$	102,304	$	98,883	$	319,505	$	415,922
Services		5,419		6,800		23,453		26,653
Total revenue		107,723		105,683		342,958		442,575
Cost of revenue:
Product		57,627		55,023		175,732		236,446
Services		5,780		7,093		23,074		26,493
Total cost of revenue		63,407		62,116		198,806		262,939
Gross profit		44,316		43,567		144,152		179,636
Operating expenses:
Research and development		13,596		14,245		53,931		51,876
Sales and marketing		8,879		9,362		34,290		34,608
General and administrative		8,629		8,438		31,726		33,193
Total operating expenses		31,104		32,045		119,947		119,677
Income from operations		13,212		11,522		24,205		59,959
Other (expense) income:
Interest income		582		810		2,955		2,328
Interest expense		(1,306)		(1,323)		(5,155)		(5,110)
Other, net		169		(762)		(1,083)		(2,472)
Total other expense		(555)		(1,275)		(3,283)		(5,254)
Income before income taxes		12,657		10,247		20,922		54,705
Income tax provision		2,945		1,784		3,888		8,820
Net income	$	9,712	$	8,463	$	17,034	$	45,885
Net income per share:
Basic	$	0.30	$	0.26	$	0.52	$	1.42
Diluted	$	0.29	$	0.25	$	0.50	$	1.35
Shares used in computing net income per share:
Basic weighted average common shares		32,485		32,467		32,559		32,286
Diluted weighted average common shares		33,848		33,886		33,828		34,002

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

	December 31,		December 31,
	2019		2018
ASSETS
Current assets:
Cash and cash equivalents	$	139,881	$	177,993
Accounts receivable, net		83,753		78,727
Inventories, net		140,364		129,000
Prepaid expenses and other current assets		11,681		11,051
Total current assets		375,679		396,771
Property, plant and equipment, net		25,328		41,149
Operating lease assets		5,849		—
Finance lease assets, net		21,880		—
Long-term restricted cash		6,653		6,909
Deferred income taxes		68,060		71,939
Other assets		44,645		31,673
Total assets	$	548,094	$	548,441

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	25,341	$	35,955
Accrued compensation		7,631		19,218
Warranty		2,759		4,819
Income taxes		294		462
Deferred revenue		24,601		19,513
Current portion of long-term debt		399		—
Other current liabilities		7,639		5,030
Total current liabilities		68,664		84,997
Finance lease obligation		48,149		47,757
Long-term deferred revenue		4,650		3,071
Other long-term liabilities		7,204		4,279
Total liabilities		128,667		140,104
Commitments and contingencies
Stockholders' equity:
Common stock, $0.001 par value, 75,000 shares authorized; 32,585 shares issued and outstanding at December 31, 2019; 32,558 shares issued and outstanding at December 31, 2018		33		33
Additional paid-in capital		559,878		565,116
Accumulated deficit		(140,226)		(157,260)
Accumulated other comprehensive (loss) income		(258)		448
Total stockholders' equity		419,427		408,337
Total liabilities and stockholders' equity	$	548,094	$	548,441