Rudolph
Technologies, Inc. (NYSE: RTEC), a leading provider of semiconductor
process control systems, lithography equipment, as well as process
control and yield management software for wafer fabs and advanced
packaging facilities, today announced financial results for the 2019
first quarter.
2019 First Quarter Highlights
-
Revenue of $60.9 million, near the high end of guidance, aided by 6%
higher advanced packaging inspection systems revenue. -
GAAP earnings of $0.24 per share were above the high end of Company
guidance. -
New product traction gained:
-
Multiple shipments of Dragonfly™
G2 systems combining 50% faster 2D inspection, faster and more
accurate 3D metrology, and patented Clearfind™ Technology on a
single high performance platform. -
Backlog for new NovusEdge™
unpatterned wafer macro inspection systems has grown to $20
million for deliveries in the second half of 2019 and the first
half of 2020. -
Announced the availability of next-generation JetStep®
lithography tool with sub-micron imaging, 35% throughput
improvement and 20% smaller footprint over the previous generation.
-
Multiple shipments of Dragonfly™
-
Shipments of $15 million of process control systems and software to a major
memory manufacturer transitioning high-end DRAM products to
advanced packaging using copper pillar and through silicon via
technology. - Cash and marketable securities was $170.8 million at March 31, 2019.
|
Key Financial Data for the Quarters Ended March 31, 2019, |
||||||||||||
| US GAAP | ||||||||||||
| March 2019 | December 2018 | March 2018 | ||||||||||
| Revenue | $ | 60,892 | $ | 62,780 | $ | 73,096 | ||||||
| Gross profit margin | 52.6 | % | 52.0 | % | 58.0 | % | ||||||
| Operating income | $ | 7,608 | $ | 9,316 | $ | 17,465 | ||||||
| Net income | $ | 7,576 | $ | 8,082 | $ | 15,130 | ||||||
| Net income per diluted share | $ | 0.24 | $ | 0.26 | $ | 0.47 | ||||||
| US NON-GAAP | ||||||||||||
| March 2019 | December 2018 | March 2018 | ||||||||||
| Revenue | $ | 60,892 | $ | 62,780 | $ | 73,096 | ||||||
| Gross profit margin | 52.7 | % | 52.1 | % | 58.1 | % | ||||||
| Operating income | $ | 10,158 | $ | 10,886 | $ | 19,352 | ||||||
| Net income | $ | 9,551 | $ | 9,164 | $ | 16,346 | ||||||
| Net income per diluted share | $ | 0.31 | $ | 0.29 | $ | 0.51 | ||||||
Michael Plisinski, chief executive officer, commented, “Rudolph was able
to increase our earnings per share by 7% on a non-GAAP basis
underscoring the strength of our diversified business model despite
slightly lower quarter-over-quarter revenue. We are pleased with the
progress our new products are having in the market and we will continue
to invest in areas that both strengthen our position in diversified
markets as well as expand into new markets such as wafer
manufacturing and lithography.”
First Quarter 2019 GAAP Financial Results
First quarter
revenue totaled $60.9 million, a decrease of 3% compared with $62.8
million for the fourth quarter of 2018. Gross margin was 52.6% of
revenues in the first quarter of 2019, an increase from 52.0% in the
fourth quarter of 2018. The increase in gross margin was driven mainly
by product mix.
Operating expenses for the first quarter of 2019 totaled $24.4 million,
compared to $23.4 million in the fourth quarter of 2018. Operating
expenses represented 40% of revenue in the 2019 first quarter compared
to 37% of revenue in the fourth quarter of 2018. The increase in
operating expenses over the prior quarter was primarily due to an
increase in spending on R&D initiatives and timing of stock-based
compensation costs in the quarter.
GAAP net income for the first quarter of 2019 was $7.6 million, or $0.24
per diluted share, compared with a net income of $8.1 million, or $0.26
per diluted share, for the 2018 fourth quarter. The decrease in GAAP net
income over the prior quarter was due to lower revenue and higher
operating expenses offset by a lower tax rate in the quarter.
First Quarter Non-GAAP Financial Results
First quarter 2019
non-GAAP net income was $9.6 million, or $0.31 per diluted share
detailed in the attached table. Fourth quarter of 2018, non-GAAP net
income was $9.2 million, or $0.29 per diluted share. Non-GAAP results
exclude share-based compensation expense and the amortization of
intangible assets.
Outlook
The Company is currently anticipating revenue for
the second quarter ended June 30, 2019 to be in the range of $60 to $65
Million. The Company is also expecting diluted GAAP net income per share
to be in the range of $0.18 to $0.25 and non-GAAP net income per diluted
share to be in the range of $0.23 to $0.30.
Conference Call
Rudolph Technologies will discuss its 2019
first quarter results on a conference call it is hosting today at 4:30
PM EDT. To participate in the call, please dial (800) 263-0877
(Domestic) or +1 (720) 543-0197 (International), reference confirmation
code 3189484 at least five (5) minutes prior to the scheduled start
time. A live webcast will also be available on the Company’s website at www.rudolphtech.com.
To listen to the live webcast, please go to the website at least fifteen
(15) minutes early to register, download and install any necessary audio
software. There will be a replay of the conference call available from
7:30 p.m. ET on May 6 until 7:30 p.m. ET on May 13, 2019. To access the
replay, please dial (888) 203-1112 (Domestic) or (719) 457-0820
(International) at any time during that period and use audio replay
passcode 3189484.
A replay will also be available on the Company’s website at www.rudolphtech.com.
Discussion of Non-GAAP Financial Measures
The Company has
provided in this release non-GAAP financial information including
non-GAAP gross profit, operating income, net income, and net income per
diluted share, as a supplement to the condensed consolidated financial
statements, which are prepared in accordance with generally accepted
accounting principles (“GAAP”). Management uses these non-GAAP financial
measures internally in analyzing the Company’s financial results to
assess operational performance. The Company believes that both
management and investors benefit from referring to these non-GAAP
financial measures in assessing its performance and when planning,
forecasting and analyzing future periods. Further, the Company believes
these non-GAAP financial measures are useful to investors because they
allow for greater transparency with respect to key financial metrics
that the Company uses in making operating decisions and because the
Company believes that investors and analysts use them to help assess the
health of its business and for comparison to other companies. Non-GAAP
results are presented for supplemental informational purposes only for
understanding the Company’s operating results. The non-GAAP information
should not be considered a substitute for financial information
presented in accordance with GAAP, and may be different from non-GAAP
measures used by other companies.
The financial statements provided with this release include a
reconciliation of the non-GAAP financial measures to those measures
reported in accordance with GAAP.
The Company’s non-GAAP financial measures, used in this press release,
reflect adjustments based on the following items:
Share-based compensation expense. These expenses relate to
employee restricted stock units and employee stock options. The Company
excludes stock-based compensation expense from its non-GAAP measures
primarily because such expenses are non-cash expenses that the Company
does not believe are reflective of ongoing operating results.
Amortization of intangibles. The Company incurs expenses for the
amortization of intangible assets acquired in acquisitions. The Company
excludes these items because these expenses are not reflective of
ongoing operating results in the period incurred. These amounts arise
from the Company’s prior acquisitions and have no direct correlation to
the operation of the Company’s core business.
Net tax provision (benefit) adjustments. This line item
represents the income tax effects of the non-GAAP items.
About Rudolph Technologies
Rudolph Technologies, Inc. is a
leader in the design, development, manufacture and support of defect
inspection, lithography, process control metrology, and process control
software used by semiconductor and advanced packaging device
manufacturers worldwide. Rudolph delivers comprehensive solutions
throughout the fab with its families of proprietary products that
provide critical yield-enhancing information, enabling microelectronic
device manufacturers to drive down costs and time to market of their
devices. Headquartered in Wilmington, Massachusetts, Rudolph supports
its customers with a worldwide sales and service organization.
Additional information can be found on the Company’s website at www.rudolphtech.com.
Forward Looking Statements
This press release contains
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 (the “Act”) which include Rudolph’s
business momentum and future growth; the benefit to customers of
Rudolph’s products and customer service; Rudolph’s ability to both
deliver products and services consistent with our customers’ demands and
expectations and strengthen its market position; Rudolph’s expectations
regarding the semiconductor market outlook; Rudolph’s second quarter
2019 financial outlook; as well as other matters that are not purely
historical data. Rudolph wishes to take advantage of the “safe harbor”
provided for by the Act and cautions that actual results may differ
materially from those projected as a result of various factors,
including risks and uncertainties, many of which are beyond Rudolph’s
control. Such factors include, but are not limited to, the Company’s
ability to leverage its resources to improve its position in its core
markets; its ability to weather difficult economic environments; its
ability to open new market opportunities and target high-margin markets;
the strength/weakness of the back-end and/or front-end semiconductor
market segments; and fluctuations in customer capital spending.
Additional information and considerations regarding the risks faced by
Rudolph are available in Rudolph’s Form 10-K report for the year ended
December 31, 2018 and other filings with the Securities and Exchange
Commission. As the forward-looking statements are based on Rudolph’s
current expectations, the Company cannot guarantee any related future
results, levels of activity, performance or achievements. Rudolph does
not assume any obligation to update the forward-looking information
contained in this press release.
|
RUDOLPH TECHNOLOGIES, INC. |
|||||||
|
March 31, |
December 31, |
||||||
| (Audited) | |||||||
| ASSETS | |||||||
| Current assets | |||||||
| Cash, cash equivalents and marketable securities | $ | 170,770 | $ | 175,072 | |||
| Accounts receivable, net | 66,357 | 64,194 | |||||
| Inventories | 103,989 | 96,820 | |||||
| Prepaid and other assets | 15,004 | 14,821 | |||||
| Total current assets | 356,120 | 350,907 | |||||
| Net property, plant and equipment | 18,599 | 18,874 | |||||
| Intangibles, net | 29,556 | 29,943 | |||||
| Other assets | 32,035 | 18,316 | |||||
| Total assets | $ | 436,310 | $ | 418,040 | |||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
| Current liabilities | |||||||
| Accounts payable and accrued liabilities | $ | 26,391 | $ | 30,681 | |||
| Other current liabilities | 17,801 | 14,310 | |||||
| Total current liabilities | 44,192 | 44,991 | |||||
| Other non-current liabilities | 22,256 | 11,161 | |||||
| Total liabilities | 66,448 | 56,152 | |||||
| Stockholders’ equity | 369,862 | 361,888 | |||||
| Total liabilities and stockholders’ equity | $ | 436,310 | $ | 418,040 | |||
|
RUDOLPH TECHNOLOGIES, INC. |
||||||||||||
| Three Months Ended | ||||||||||||
| March 31, | December 31, | March 31, | ||||||||||
| 2019 | 2018 | 2018 | ||||||||||
| Revenue | $ | 60,892 | $ | 62,780 | $ | 73,096 | ||||||
| Cost of revenue | 28,873 | 30,112 | 30,675 | |||||||||
| Gross profit | 32,019 | 32,668 | 42,421 | |||||||||
| Operating expenses: | ||||||||||||
|
Research and development |
12,718 | 12,224 | 11,783 | |||||||||
|
Selling, general and administrative |
11,306 | 10,741 | 12,793 | |||||||||
| Amortization | 387 | 387 | 380 | |||||||||
|
Total operating expenses |
24,411 | 23,352 | 24,956 | |||||||||
| Operating income | 7,608 | 9,316 | 17,465 | |||||||||
| Interest income, net | (806 | ) | (732 | ) | (391 | ) | ||||||
| Other (income) expense, net | (381 | ) | 34 | 182 | ||||||||
| Income before income taxes | 8,795 | 10,014 | 17,674 | |||||||||
| Provision for income taxes | 1,219 | 1,932 | 2,544 | |||||||||
| Net income | $ | 7,576 | $ | 8,082 | $ | 15,130 | ||||||
| Earnings per share: | ||||||||||||
| Basic | $ | 0.25 | $ | 0.26 | $ | 0.48 | ||||||
| Diluted | $ | 0.24 | $ | 0.26 | $ | 0.47 | ||||||
|
Weighted average shares
outstanding: |
||||||||||||
| Basic | 30,916 | 31,268 | 31,662 | |||||||||
| Diluted | 31,266 | 31,645 | 32,317 | |||||||||
|
RUDOLPH TECHNOLOGIES, INC. |
||||||||||||
| Three Months Ended | ||||||||||||
|
March 31,
2019 |
December 31,
2018 |
March 31,
2018 |
||||||||||
| Revenue | $ | 60,892 | $ | 62,780 | $ | 73,096 | ||||||
| Gross profit | $ | 32,082 | $ | 32,704 | $ | 42,482 | ||||||
|
Gross margin as percentage of revenue |
52.7 | % | 52.1 | % | 58.1 | % | ||||||
| Operating expenses | $ | 21,924 | $ | 21,818 | $ | 23,130 | ||||||
| Operating income | $ | 10,158 | $ | 10,886 | $ | 19,352 | ||||||
|
Operating margin as a percentage of revenue |
16.7 | % | 17.3 | % | 26.5 | % | ||||||
| Net income | $ | 9,551 | $ | 9,164 | $ | 16,346 | ||||||
| Net income per diluted share | $ | 0.31 | $ | 0.29 | $ | 0.51 | ||||||
|
RECONCILIATION OF U.S. GAAP GROSS PROFIT, |
||||||||||||
| Three Months Ended | ||||||||||||
|
March 31, |
December 31, |
March 31, |
||||||||||
| U.S. GAAP gross profit | $ | 32,019 | $ | 32,668 | $ | 42,421 | ||||||
| Pre-tax non-GAAP items: | ||||||||||||
|
Share-based compensation expense |
63 | 36 | 61 | |||||||||
| Non-GAAP gross profit | $ | 32,082 | $ | 32,704 | $ | 42,482 | ||||||
|
U.S. GAAP gross margin as a percentage of revenue |
52.6 | % | 52.0 | % | 58.0 | % | ||||||
|
Non-GAAP gross margin as a percentage of revenue |
52.7 | % | 52.1 | % | 58.1 | % | ||||||
| U.S. GAAP operating expenses | $ | 24,411 | $ | 23,352 | $ | 24,956 | ||||||
| Pre-tax non-GAAP items: | ||||||||||||
| Amortization of intangibles | 387 | 387 | 380 | |||||||||
|
Share-based compensation expense |
2,100 | 1,147 | 1,446 | |||||||||
| Non-GAAP operating expenses | 21,924 | 21,818 | 23,130 | |||||||||
| Non-GAAP operating income | $ | 10,158 | $ | 10,886 | $ | 19,352 | ||||||
|
GAAP operating margin as a percentage of revenue |
12.5 | % | 14.8 | % | 23.9 | % | ||||||
|
Non-GAAP operating margin as a percentage of revenue |
16.7 | % | 17.3 | % | 26.5 | % | ||||||
|
RUDOLPH TECHNOLOGIES, INC. |
||||||||||||
| Three Months Ended | ||||||||||||
|
March 31, |
December 31, |
March 31, |
||||||||||
| U.S. GAAP net income | $ | 7,576 | $ | 8,082 | $ | 15,130 | ||||||
| Pre-tax non-GAAP items | ||||||||||||
| Amortization of intangibles | 387 | 387 | 380 | |||||||||
|
Share-based compensation expense |
2,163 | 1,183 | 1,507 | |||||||||
| Net tax benefit adjustments | (575 | ) | (488 | ) | (671 | ) | ||||||
| Non-GAAP net income | $ | 9,551 | $ | 9,164 | $ | 16,346 | ||||||
|
Non-GAAP net income per diluted share |
$ | 0.31 | $ | 0.29 | $ | 0.51 | ||||||
|
SUPPLEMENTAL INFORMATION – RECONCILIATION OF SECOND QUARTER 2019 |
||||||||
| Low | High | |||||||
| Estimated GAAP net income per diluted share | $ | 0.18 | $ | 0.25 | ||||
| Estimated non-GAAP items: | ||||||||
| Share-based compensation expense | 0.04 | 0.04 | ||||||
| Amortization of intangibles | 0.01 | 0.01 | ||||||
| Estimated non-GAAP net income per diluted share | $ | 0.23 | $ | 0.30 | ||||
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