Brooks Automation Reports Fourth Quarter and Year-End Results of Fiscal Year 2019, Ended September 30, 2019, and Announces Quarterly Cash Dividend

Revenue Growth at 24% Caps Off a Transformative Year of High Growth and Margin Expansion

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Nov 06, 2019, 16:05 ET

CHELMSFORD, Mass., Nov. 6, 2019 /PRNewswire/ -- Brooks Automation, Inc. (Nasdaq: BRKS), a leader in automation solutions for the semiconductor manufacturing and life sciences industries, today reported financial results for the fourth quarter and the fiscal year ended September 30, 2019.



Financial Results Summary

	Quarter Ended						Year Ended
Dollars in millions, except per share data	September 30,		September 30,				September 30,		September 30,
	2019		2018		Change		2019		2018		Change
Revenue	$	200	$	160	25	%	$	782	$	632	24	%
Semiconductor Solutions Group	$	106	$	109	(3)	%	$	448	$	435	3	%
Life Sciences	$	94	$	51	85	%	$	334	$	197	70	%

Diluted EPS Continuing Operations	$	0.08	$	(0.02)			$	0.14	$	0.95
Diluted EPS Total	$	5.69	$	0.15			$	6.05	$	1.64

Non-GAAP Diluted EPS Cont. Operations	$	0.24	$	0.17	43	%	$	0.77	$	0.64	20	%

Adjusted EBITDA	$	31	$	22	39	%	$	128	$	93	37	%

On July 1, 2019, the Company announced that it had completed the sale of its Semiconductor Cryogenics business to Edwards Vacuum LLC (a member of the Atlas Copco Group). In accordance with GAAP, the Company reports the results of the Semiconductor Cryogenics business as discontinued operations for all periods presented.

Management Comments
"In the fourth quarter we delivered continued growth in our Life Sciences business, solid performance in our Semiconductor business, and one of our highest quarters in cash generation," commented Steve Schwartz, CEO of Brooks Automation. "We capped off a year in which all areas of the business provided growth and margin expansion. It was truly a transformative year for us as our team successfully completed the acquisition of GENEWIZ and closed the sale of the Semiconductor Cryogenics business. We have good momentum in Life Sciences revenue, strong bookings in the Semiconductor Solutions business, and a solid balance sheet that supports additional investments. We have set the stage for a strong 2020 fiscal year."

Summary of GAAP Results

Fourth Quarter, Fiscal 2019

Revenue of $200 million was up 25% year over year, driven by the Life Sciences segment growth of 85% and slightly offset by a decline of 3% in Semiconductor Solutions. Sequentially, quarterly revenue declined 2% driven by lower Semiconductor Solutions revenue which was down 9%, offset by Life Sciences revenue, up 7% compared to the third quarter of fiscal 2019.
Life Sciences revenue of $94 million grew 85% year over year, inclusive of 10% organic growth, all attributable to Sample Management. GENEWIZ, acquired in November of 2018, contributed $40 million of revenue in the fourth quarter.
Semiconductor Solutions revenue of $106 million was down 3% year over year, yet stable relative to the overall semiconductor capital equipment market.
GAAP diluted EPS was $5.69 compared to $0.15 in the fourth quarter of 2018. Discontinued operations provided $5.61 earnings per share supported by a $409 million gain on the sale of the Semiconductor Cryogenics business. Continuing operations yielded $0.08 in the quarter compared to ($0.02) in the fourth quarter a year ago.
GAAP operating income was $11 million, compared to $4 million in the fourth quarter of 2018.
Net interest expense for the fourth fiscal quarter was $0.3 million, down from $2.0 million in the fourth quarter of 2018 and down from $7.9 million in the third fiscal quarter of 2019, as a result of the reduction of $495 million of debt on July 1, 2019. The divestiture generated $662 million of cash in the quarter.
Cash flow from operations was $33 million in the quarter, inclusive of $13 million of transaction fees paid, stemming from the closure of the Cryogenics sale. Excluding these one-time cash outflows, our operating cash flow was $46 million. The ending balance of total debt was $51 million and the balance of cash, cash equivalents, restricted cash, and marketable securities was $342 million.

Full Year, Fiscal 2019

Revenue for fiscal 2019 was $782 million, an increase of 24% compared to fiscal 2018. Growth was supported by both segments. Life Sciences revenue of $334 million was 70% higher than fiscal 2018, inclusive of 8% organic growth. Semiconductor revenue was $448 million was an increase of 3% over the prior year.
GAAP diluted EPS was $6.05 compared to $1.64 in fiscal 2018. Discontinued operations provided $5.91 primarily from the $409 million gain on the sale of the Semiconductor Cryogenics business. Continuing operations provided $0.14 compared to $0.95 in fiscal 2018, which included a tax benefit of $43 million for the reversal of a valuation allowance reserve. Fiscal year 2019 results included $11 million of additional amortization of intangibles driven by the acquisition of GENEWIZ and $14 million in charges for the extinguishment of debt.
GAAP operating income was $47 million, an increase of 48% compared to fiscal 2018.
Cash flow from operations was $91 million, a 23% increase compared to $74 million in fiscal 2018. Excluding transaction fees paid upon the closure of the Cryogenics sale, cash flow from operations was $104 million, a 41% increase from 2018.

Summary of Non-GAAP Results for Continuing Operations

Fourth Quarter, Fiscal 2019

Non-GAAP diluted EPS from continuing operations for the quarter was $0.24, a 43% increase compared to the fourth quarter of 2018.
Non-GAAP operating margin was 10.8%, higher by 140 basis points compared to the fourth quarter of 2018. The improvement was driven by non-GAAP gross margin performance, which was 41.8% and 160 basis points higher year over year, driven by Life Sciences adjusted gross margin of 42.6% which was higher by 480 basis points year over year. The improvement reflects 220 basis points improvement in Sample Management operations and the favorable mix of adding GENEWIZ to the business. Operating expense increased 26% year over year, consistent with revenue and reflecting the incremental structure of GENEWIZ and an increase in Semiconductor R&D spending.
Adjusted EBITDA in the quarter increased 39% year over year to $31 million, up from $22 million in the prior year quarter. The adjusted EBITDA margin improved to 15.7% from 14.1% in the fourth quarter of fiscal 2018.

Full Year, Fiscal 2019

Non-GAAP diluted EPS from continuing operations for 2019 was $0.77, a 20% increase compared to $0.64 in 2018. The increase reflects the 24% revenue growth and improvement in operating margin of 130 basis points, partially offset by higher interest expense.
Operating income was $91 million, a 39% increase from 2018. The increase was supported by non-GAAP gross margins of 41.9%, which improved 190 basis points compared to 2018. Life Sciences gross margins were 42.4%, up 440 basis points from last year driven by the inclusion of GENEWIZ results and 40 basis points of improvement in Sample Management. The Semiconductor Solutions business gross margin improved 60 basis points from last year to 41.5%.

A reconciliation of non-GAAP measures to the most nearly comparable GAAP measures follows the consolidated balance sheets, statements of operations and statements of cash flows included in this release.

Quarterly Cash Dividend
The Company additionally announced that the Board of Directors has reiterated a dividend of $0.10 per share payable on December 20, 2019 to stockholders of record on December 6, 2019. Future dividend declarations, as well as the record and payment dates for such dividends, are subject to the final determination of the Company's Board of Directors.

Guidance for Fiscal First Quarter 2020
The Company announced revenue and earnings guidance for the first quarter of fiscal 2020. Revenue is expected to be in the range of $204 million to $214 million and non-GAAP diluted earnings per share is expected to be in the range of $0.20 to $0.27. GAAP diluted earnings per share for the first quarter is expected to be in the range of $0.09 to $0.17.

Conference Call
Brooks management will webcast its fourth quarter and year-end earnings conference call today at 4:30 p.m. Eastern Time. During the call, Company management will respond to questions concerning, but not limited to, the Company's financial performance, business conditions and industry outlook. Management's responses could contain information that has not been previously disclosed.

The call will be broadcast live over the Internet and, together with presentation materials referenced on the call, will be hosted at the Investor Relations section of Brooks' website at https://brooks.investorroom.com/events, and will be archived online on this website for convenient on-demand replay. In addition, you may call 877-256-3275 (US & Canada only) or +1-212-231-2938 for international callers to listen to the live webcast.

Regulation G – Use of Non-GAAP financial Measures
The Company supplements its GAAP financial measures with certain non-GAAP financial measures to provide investors a better perspective on the results of business operations, which the Company believes is more comparable to the similar analysis provided by its peers. These measures are not presented in accordance with, nor are they a substitute for, U.S. generally accepted accounting principles, or GAAP. These measures should always be considered in conjunction with appropriate GAAP measures. A reconciliation of non-GAAP measures to the most nearly comparable GAAP measures is included at the end of this release following the consolidated balance sheets, statements of operations and statements of cash flows.

"Safe Harbor Statement" under Section 21E of the Securities Exchange Act of 1934
Some statements in this release are forward-looking statements made under Section 21E of the Securities Exchange Act of 1934. These statements are neither promises nor guarantees but involve risks and uncertainties, both known and unknown, that could cause Brooks' financial and business results to differ materially from our expectations. They are based on the facts known to management at the time they are made. These forward-looking statements include but are not limited to statements our revenue and earnings expectations, our ability to increase our profitability, our ability to improve or retain our market position, the expected financial results from our recently acquired GENEWIZ business and our ability to deliver financial success in the future. Factors that could cause results to differ from our expectations include the following: the volatility of the industries the Company serves, particularly the semiconductor industry; our possible inability to meet demand for our products due to difficulties in obtaining components and materials from our suppliers in required quantities and of required quality; the inability of customers to make payments to us when due; the timing and effectiveness of cost reduction and cost control measures; price competition; disputes concerning intellectual property; uncertainties in global political and economic conditions, and other factors and other risks, including those that we have described in our filings with the Securities and Exchange Commission, including but not limited to our Annual Report on Form 10-K, current reports on Form 8-K and our quarterly reports on Form 10-Q. As a result, we can provide no assurance that our future results will not be materially different from those projected. Brooks expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statement to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based. Brooks undertakes no obligation to update the information contained in this press release.

About Brooks Automation, Inc.
Brooks is a leading provider of life science and semiconductor manufacturing automation solutions worldwide. The Company applies its automation and cryogenics expertise to provide a full suite of reliable cold-chain sample management solutions across life sciences in areas such as drug development, clinical research and advanced cell therapies. Brooks recently added global capability for gene sequencing and gene synthesis services through its strategic acquisition of GENEWIZ, expanding its sample-based services offerings. With over 40 years as a partner to the semiconductor manufacturing industry, Brooks is a provider of industry-leading precision robotics, integrated automation systems and services. Brooks is headquartered in Chelmsford, MA, with operations in North America, Europe and Asia. For more information, visit www.brooks.com.

INVESTOR CONTACTS:
Mark Namaroff
Director, Investor Relations
Brooks Automation
978.262.2635
[email protected]

Sherry Dinsmore
Brooks Automation
978.262.2400
[email protected]

John Mills
Partner
ICR, LLC
646.277.1254
[email protected]

BROOKS AUTOMATION, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except per share data)


	Three Months Ended				Year Ended
	September 30,				September 30,
	2019		2018		2019		2018
Revenue
Products	$	123,219	$	120,307	$	505,046	$	482,389
Services		77,009		39,339		276,819		149,171
Total revenue		200,228		159,646		781,865		631,560
Cost of revenue
Products		73,177		71,820		302,757		288,323
Services		46,400		25,206		162,351		97,156
Total cost of revenue		119,577		97,026		465,108		385,479
Gross profit		80,651		62,620		316,757		246,081
Operating expenses
Research and development		14,883		12,138		56,368		46,936
Selling, general and administrative		53,451		46,281		211,960		167,022
Restructuring charges		1,209		585		1,894		714
Total operating expenses		69,542		59,004		270,222		214,672
Operating income		11,109		3,616		46,535		31,409
Interest income		602		688		1,449		1,881
Interest expense		(902)		(2,679)		(22,250)		(9,520)
Loss on extinguishment of debt		(5,288)		—		(14,339)		—
Other expenses, net		(339)		(257)		(1,455)		(3,304)
Income before income taxes		5,182		1,368		9,940		20,466
Income tax provision (benefit)		(350)		2,580		50		(47,251)
Income (loss) from continuing operations	$	5,532	$	(1,212)	$	9,890	$	67,717
Income from discontinued operations, net of tax		407,131		11,563		427,862		48,747
Net income	$	412,663	$	10,351	$	437,752	$	116,464
Net loss attributable to noncontrolling interest		—		—		—		111
Net income attributable to Brooks Automation, Inc.	$	412,663	$	10,351	$	437,752	$	116,575
Basic net income per share:
Basic net income per share from continuing operations	$	0.08	$	(0.02)	$	0.14	$	0.96
Basic net income per share from discontinued operations		5.63		0.16		5.94		0.69
Basic net income per share	$	5.71	$	0.15	$	6.08	$	1.65
Diluted net income per share:
Diluted net income per share from continuing operations	$	0.08	$	(0.02)	$	0.14	$	0.95
Diluted net income per share from discontinued operations		5.61		0.16		5.91		0.69
Diluted net income per share	$	5.69	$	0.15	$	6.05	$	1.64

Weighted average shares outstanding used in computing net income per share:
Basic		72,273		70,681		71,992		70,489
Diluted		72,558		71,085		72,386		70,937

BROOKS AUTOMATION, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands, except share and per share data)


	September 30,		September 30,
	2019		2018

Assets
Current assets
Cash and cash equivalents	$	301,642	$	197,708
Marketable securities		34,124		46,281
Accounts receivable, net		166,657		125,192
Inventories		99,445		96,986
Prepaid expenses and other current assets		46,331		31,741
Current assets held for sale		—		66,148
Total current assets		648,199		564,056
Property, plant and equipment, net		100,669		59,988
Long-term marketable securities		2,845		7,237
Long-term deferred tax assets		5,064		43,798
Goodwill		488,602		255,876
Intangible assets, net		251,168		99,956
Other assets		20,507		5,294
Non-current assets held for sale		—		59,052
Total assets	$	1,517,054	$	1,095,257
Liabilities and Stockholders' Equity
Current liabilities
Current portion of long-term debt	$	829	$	2,000
Accounts payable		59,437		44,724
Deferred revenue		29,477		25,884
Accrued warranty and retrofit costs		7,175		6,340
Accrued compensation and benefits		31,375		29,322
Accrued restructuring costs		1,040		659
Accrued income taxes payable		99,423		6,746
Accrued expenses and other current liabilities		44,234		30,405
Current liabilities held for sale		—		18,537
Total current liabilities		272,990		164,617
Long-term debt		50,315		194,071
Long-term tax reserves		18,273		1,102
Long-term deferred tax liabilities		20,636		7,135
Long-term pension liabilities		5,338		4,255
Other long-term liabilities		10,212		5,547
Non-current liabilities held for sale		—		698
Total liabilities		377,764		377,425
Stockholders' Equity
Preferred stock, $0.01 par value - 1,000,000 shares authorized, no shares issued or outstanding		—		—
Common stock, $0.01 par value - 125,000,000 shares authorized, 85,759,700 shares issued and 72,297,831 shares outstanding at September 30, 2019, 84,164,130 shares issued and 70,702,261 shares outstanding at September 30, 2018		857		841
Additional paid-in capital		1,921,954		1,898,434
Accumulated other comprehensive income		3,510		13,587
Treasury stock at cost - 13,461,869 shares		(200,956)		(200,956)
Accumulated deficit		(586,075)		(994,074)
Total stockholders' equity		1,139,290		717,832
Total liabilities and stockholders' equity	$	1,517,054	$	1,095,257

BROOKS AUTOMATION, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(In thousands)


	Year Ended
	September 30,
	2019		2018
Cash flows from operating activities
Net income	$	437,752	$	116,464
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		54,454		37,429
Impairment of property, plant and equipment		285		—
Stock-based compensation		20,113		19,822
Amortization of premium on marketable securities and deferred financing costs		1,121		710
Earnings of equity method investments		(6,188)		(6,788)
Loss recovery on insurance claim		—		(1,103)
Deferred income taxes		(15,161)		(45,217)
Loss on extinguishment of debt		14,339		—
Other gains on disposals of assets		209		(758)
Gain on sale of divestiture, net of tax		(408,575)		—
Contingent transaction fees paid stemming from divestiture		(13,388)		—
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable		(12,504)		(28,463)
Inventories		(2,933)		(24,365)
Prepaid expenses and current assets		(16,009)		(3,676)
Accounts payable		5,215		5,457
Deferred revenue		4,255		2,791
Accrued warranty and retrofit costs		1,109		(157)
Accrued compensation and tax withholdings		(6,453)		5,978
Accrued restructuring costs		399		(1,080)
Proceeds from recovery on insurance claim		1,082		—
Accrued expenses and current liabilities		31,776		(3,080)
Net cash provided by operating activities		90,898		73,964
Cash flows from investing activities
Purchases of property, plant and equipment		(23,861)		(12,787)
Purchases of marketable securities		(35,225)		(69,692)
Sales of marketable securities		48,903		1,584
Maturities of marketable securities		2,557		17,482
Proceeds from divestiture, net of transaction costs		661,642
Acquisitions, net of cash acquired		(442,704)		(85,755)
Proceeds from other investments		—		500
Proceeds from sales of property, plant and equipment		—		200
Net cash provided by (used) in investing activities		211,312		(148,468)
Cash flows from financing activities
Proceeds from term loans, net of discount		686,386		197,554
Proceeds from issuance of common stock		3,422		2,826
Payments of financing costs		(687)		(318)
Principal payments on debt		(850,190)		(1,500)
Payments of capital leases		(1,197)		—
Common stock dividends paid		(28,895)		(28,285)
Net cash provided by (used in) financing activities		(191,161)		170,277
Effects of exchange rate changes on cash and cash equivalents		(3,586)		313
Net increase in cash and cash equivalents		107,463		96,086
Cash and cash equivalents and restricted cash, beginning of period		197,708		101,622
Cash and cash equivalents and restricted cash, end of period	$	305,171	$	197,708

Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets
Cash and cash equivalents	$	301,642	$	197,708
Restricted cash included in prepaid expenses and other current assets		3,529		—
Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows	$	305,171	$	197,708

Notes on Non-GAAP Financial Measures:
These financial measures are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. Management adjusted the GAAP results for the impact of amortization of intangible assets, restructuring charges, purchase price accounting adjustments and charges related to M&A to provide investors better perspective on the results of operations which the Company believes is more comparable to the similar analysis provided by its peers. Management also excludes special charges and gains, such as impairment losses, gains and losses from the sale of assets, as well as other gains and charges that are not representative of the normal operations of the business. In this context, the Company has also removed the effect of reversing the valuation allowance reserve on the U.S. deferred income tax assets. Management strongly encourages investors to review our financial statements and publicly-filed reports in their entirety and not rely on any single measure.


	Quarter Ended
	September 30, 2019					June 30, 2019					September 30, 2018
				per diluted					per diluted					per diluted
Dollars in thousands, except per share data				share					share					share
Net income (loss) from continuing operations	$	5,532		$	0.08	$	921		$	0.01	$	(1,212)		$	(0.02)
Adjustments:
Amortization of intangible assets		8,931			0.12		9,050			0.12		6,530			0.09
Restructuring charges		1,209			0.02		256			0.00		585			0.01
Loss on extinguishment of debt		5,288			—		—			—		—			—
Merger costs		134			0.00		156			0.00		4,309			0.06
Restructuring related charges		285
Adjustment of valuation allowance against deferred tax assets		(233)			(0.00)		—			—		690			0.01
Tax Reform - rate change applied to deferred tax liabilities⁽¹⁾		—			—		4,281			0.06		—			—
Tax adjustments ⁽²⁾		—			—		974			0.01		—			—
Tax effect of adjustments		(3,932)			(0.05)		(1,345)			(0.02)		868			0.01
Non-GAAP adjusted net income from continuing operations	$	17,214		$	0.24	$	14,293		$	0.20	$	11,770		$	0.17
Stock based compensation, pre-tax		4,941			0.07		5,277			0.07		4,587			0.06
Tax rate		15	%		—		15	%		—		9	%		—
Stock-based compensation, net of tax		4,200			0.06		4,485			0.06		4,188			0.06
Non-GAAP adjusted net income excluding stock-based compensation - continuing operations	$	21,414		$	0.30	$	18,778		$	0.26	$	15,958		$	0.22

Shares used in computing non-GAAP diluted net income per share		—			72,558		—			72,470		—			71,085


						Year Ended
						September 30, 2019					September 30, 2018
									per diluted					per diluted
Dollars in thousands, except per share data						$			share		$			share
Net income from continuing operations						$	9,890		$	0.14	$	67,717		$	0.95
Adjustments:
Purchase accounting impact on inventory and contracts acquired							184			0.00		1,896			0.03
Amortization of intangible assets							35,161			0.49		24,216			0.34
Restructuring charges							1,894			0.03		714			0.01
Loss on extinguishment of debt							14,339			—		—			—
Merger costs							6,679			0.09		6,945			0.10
Restructuring related charges							285
Adjustment of valuation allowance against deferred tax assets							(233)			(0.00)		(43,062)			(0.61)
Tax Reform - rate change applied to deferred tax liabilities⁽¹⁾							1,796			0.02		(671)			(0.01)
Tax effect of adjustments							(14,328)			(0.20)		(12,481)			(0.18)
Non-GAAP adjusted net income from continuing operations						$	55,667		$	0.77	$	45,274		$	0.64
Stock-based compensation, pre-tax							19,516			0.27		18,856			0.27
Tax rate							15	%		—		11	%		—
Stock-based compensation, net of tax							16,589		$	0.23		16,838			0.24
Non-GAAP adjusted net income excluding stock-based compensation - continuing operations						$	72,256		$	1.00	$	62,112		$	0.88

Shares used in computing non-GAAP diluted net income per share							—			72,386		—			70,937

(1)	Adjustments are related to U.S. Federal Tax Reform.

(2)	The Company elected to apply the tax benefit related to the stock compensation windfall realized in the quarter ended December 31, 2018 to the non-GAAP full year tax rate and to exclude the benefit of a change in the deferred tax benefit realized in the three months ended December 31, 2018 related to a change in the Company's state effective tax rate related to the acquisition of GENEWIZ.


	Quarter Ended						Year Ended
	September 30,		June 30,		September 30,		September 30,		September 30,
Dollars in thousands	2019		2019		2018		2019		2018
GAAP net income attributable to Brooks Automation, Inc.	$	412,663	$	7,254	$	10,351	$	437,752	$	116,575
Adjustments:
Less: Discontinued operations		(407,131)		(6,333)		(11,563)		(427,862)		(48,747)
Less: Interest income		(602)		(108)		(688)		(1,449)		(1,881)
Add: Interest expense		902		8,041		2,679		22,250		9,520
Add: Income tax provision (benefit)		(350)		7,260		2,580		50		(47,251)
Add: Depreciation		5,094		5,037		3,122		19,289		12,470
Add: Amortization of completed technology		2,764		2,863		1,487		10,424		4,877
Add: Amortization of customer relationships and acquired intangible assets		6,167		6,187		5,043		24,737		19,339
Restructuring related charges		285						285
Add: Loss on extinguishment of debt		5,288		—		—		14,339		—
Earnings before interest, taxes, depreciation and amortization	$	25,080	$	30,201	$	13,011	$	99,815	$	64,902



	Quarter Ended						Year Ended
	September 30,		June 30,		September 30,		September 30,		September 30,
Dollars in thousands	2019		2019		2018		2019		2018
Earnings before interest, taxes, depreciation and amortization	$	25,080	$	30,201	$	13,011	$	99,815	$	64,902
Adjustments:
Add: Stock-based compensation		4,941		5,277		4,587		19,516		18,856
Add: Restructuring charges		1,209		256		585		1,894		714
Add: Purchase accounting impact on inventory and contracts acquired		—		—		—		184		1,896
Add: Merger costs		134		156		4,309		6,679		6,945
Adjusted earnings before interest, taxes, depreciation and amortization	$	31,364	$	35,890	$	22,492	$	128,088	$	93,313


	Quarter Ended
	September 30, 2019				June 30, 2019				September 30, 2018
Dollars in thousands	$		%		$		%		$		%
GAAP gross profit/gross margin percentage	$	80,651	40.3	%	$	83,510	41.0	%	$	62,620	39.2	%
Adjustments:
Amortization of completed technology		2,764	1.4			2,863	1.4			1,487	0.9
Restructuring related charges		285	0.1			—	0.0			—	0.0
Non-GAAP adjusted gross profit/gross margin percentage	$	83,700	41.8	%	$	86,373	42.4	%	$	64,107	40.2	%



	Brooks Semiconductor Solutions Group
	Quarter Ended
Dollars in thousands	September 30, 2019				June 30, 2019				September 30, 2018
GAAP gross profit/margin percentage	$	42,759	40.3	%	$	47,493	40.9	%	$	43,774	40.2	%
Adjustments:
Amortization of completed technology		868	0.8			879	0.8			1,152	1.1
Non-GAAP adjusted gross profit/margin percentage	$	43,627	41.1	%	$	48,372	41.7	%	$	44,926	41.3	%



	Brooks Life Sciences
	Quarter Ended
Dollars in thousands	September 30, 2019				June 30, 2019				September 30, 2018
GAAP gross profit/margin percentage	$	37,891	40.2	%	$	36,017	41.0	%	$	18,846	37.1	%
Adjustments:
Amortization of completed technology		1,896	2.0			1,984	2.3			335	0.7
Restructuring related charges		285	0.3			—	—		0	—
Non-GAAP adjusted gross profit/margin percentage	$	40,072	42.6	%	$	38,001	43.3	%	$	19,181	37.7	%


	Brooks Semiconductor Solutions Group
	Year Ended
Dollars in thousands	September 30, 2019				September 30, 2018
GAAP gross profit/margin percentage	$	182,157	40.7	%	$	173,954	40.0	%
Adjustments:
Amortization of completed technology		3,600	0.8			3,402	0.8
Purchase accounting impact on inventory and contracts acquired		184	0.0			735	0.2
Non-GAAP adjusted gross profit/margin percentage	$	185,941	41.5	%	$	178,091	40.9	%



	Brooks Life Sciences
	Year Ended
Dollars in thousands	September 30, 2019				September 30, 2018
GAAP gross profit/margin percentage	$	134,604	40.3	%	$	72,127	36.7	%
Adjustments:
Amortization of completed technology		6,824	2.0			1,475	0.8
Purchase accounting impact on inventory and contracts acquired		—	—			1,160	0.6
Restructuring related charges		285	0.1			—	-
Non-GAAP adjusted gross profit/margin percentage	$	141,713	42.4	%	$	74,762	38.0	%


	Brooks Semiconductor Solutions Group						Brooks Life Sciences						Total Segments
	Quarter Ended						Quarter Ended						Quarter Ended
	September 30,		June 30,		September 30,		September 30,		June 30,		September 30,		September 30,		June 30,		September 30,
Dollars in thousands	2019		2019		2018		2019		2019		2018		2019		2019		2018
GAAP operating profit	$	13,223	$	19,322	$	13,316	$	4,586	$	4,202	$	382	$	17,809	$	23,524	$	13,698
Adjustments:
Amortization of completed technology		868		879		1,152		1,896		1,984		335		2,764		2,863		1,487
Restructuring related charges								285						285
Non-GAAP adjusted operating profit	$	14,091	$	20,201	$	14,468	$	6,767	$	6,186	$	717	$	20,858	$	26,387	$	15,185



	Total Segments						Corporate						Total
	Quarter Ended						Quarter Ended						Quarter Ended
	September 30,		June 30,		September 30,		September 30,		June 30,		September 30,		September 30,		June 30,		September 30,
Dollars in thousands	2019		2019		2018		2019		2019		2018		2019		2019		2018
GAAP operating profit (loss)	$	17,809	$	23,524	$	13,698	$	(6,700)	$	(7,101)	$	(10,082)	$	11,109	$	16,423	$	3,616
Adjustments:
Amortization of completed technology		2,764		2,863		1,487		—		—		—		2,764		2,863		1,487
Amortization of customer relationships and acquired intangible assets		—		—		—		6,167		6,187		5,043		6,167		6,187		5,043
Restructuring charges		—		—		—		1,209		256		585		1,209		256		585
Purchase accounting impact on inventory and contracts acquired		—		—		—		—		—		—		—		—		—
Merger costs		—		—		—		134		156		4,309		134		156		4,309
Restructuring related charges		285						—						285
Non-GAAP adjusted operating profit (loss)	$	20,858	$	26,387	$	15,185	$	810	$	(502)	$	(145)	$	21,668	$	25,885	$	15,040


	Brooks Semiconductor Solutions Group				Brooks Life Sciences				Total Segments
	Year Ended				Year Ended				Year Ended
Dollars in thousands	September 30, 2019		September 30, 2018		September 30, 2019		September 30, 2018		September 30, 2019		September 30, 2018
GAAP operating profit	$	66,673	$	58,373	$	13,522	$	1,160	$	80,195	$	59,533
Adjustments:
Amortization of completed technology		3,600		3,402		6,824		1,475		10,425		4,877
Purchase accounting impact on inventory and contracts acquired		184		735		—		1,160		184		1,896
Restructuring related charges		—		—		285		—		285		—
Non-GAAP adjusted operating profit	$	70,457	$	62,510	$	20,631	$	3,795	$	91,089	$	66,306



	Total Segments				Corporate				Total
	Year Ended				Year Ended				Year Ended
Dollars in thousands	September 30, 2019		September 30, 2018		September 30, 2019		September 30, 2018		September 30, 2019		September 30, 2018
GAAP operating profit (loss)	$	80,195	$	59,533	$	(33,660)	$	(28,124)	$	46,535	$	31,409
Adjustments:
Amortization of completed technology		10,425		4,877		—		—		10,425		4,877
Amortization of customer relationships and acquired intangible assets		—		—		24,737		19,339		24,737		19,339
Restructuring charges		—		—		1,894		714		1,894		714
Purchase accounting impact on inventory and contracts acquired		184		1,896		—		—		184		1,896
Merger costs		—		—		6,679		6,945		6,679		6,945
Restructuring related charges		285		—		—		—		285		—
Non-GAAP adjusted operating profit (loss)	$	91,089	$	66,306	$	(350)	$	(1,126)	$	90,739	$	65,180