GlobeNewswire Inc | Dec 9, 2020 06:00AM EST

December 09, 2020

-- 2020 revenue was a record $609.7 million, an increase of 11% compared with 2019 and the third consecutive year of record annual revenue -- Fourth quarter 2020 revenue was $149.3 million, down 5% sequentially and 4% year-over-year -- Net income attributable to Photronics, Inc. shareholders was $33.8 million, or $0.52 per diluted share, for the full year of 2020; and $6.5 million, or $0.10 per diluted share, for the fourth quarter of 2020 -- During the fourth quarter, cash provided by operating activities was $64.8 million, capex was $34.1 million, share repurchases were $17.5 million, and ending cash balance was $278.7 million -- First quarter 2021 guidance: revenue between $145 and $155 million with diluted EPS between $0.07 and $0.14

BROOKFIELD, Conn., Dec. 09, 2020 (GLOBE NEWSWIRE) -- Photronics, Inc. (NASDAQ:PLAB), a worldwide leader in photomask technologies and solutions, today reported financial results for its fiscal 2020 full year and fourth quarter ended October 31, 2020.

Full year revenue was a record $609.7 million, up 11% compared with 2019. IC revenue was $418.4 million, up 3% compared with last year; and FPD revenue was a record $191.3 million, up 32% compared with last year.

Fourth quarter revenue was $149.3 million, down 5% compared with the previous quarter and 4% compared with the same quarter last year. Integrated circuit (IC) revenue was $105.9 million, down 3% sequentially and 6% compared with the fourth quarter of last year. Flat panel display (FPD) revenue was $43.4 million, down 12% compared with last quarter and 1% compared with the same period last year.

Net income attributable to Photronics, Inc. shareholders was $33.8 million ($0.52 per diluted share) compared with $29.8 million ($0.44 per diluted share) in 2019; fourth quarter net income was $6.5 million ($0.10 per diluted share), compared with $10.8 million ($0.17 per diluted share) for the third quarter of 2020 and $9.7 million ($0.15 per diluted share) for the fourth quarter of 2019.

"We achieved record annual revenue for the third consecutive year in 2020, overcoming tremendous global and regional challenges, said Peter Kirlin, chief executive officer. Fourth quarter revenue declined 5% sequentially as typical seasonality was worsened by geopolitical factors and softness in some sectors. With the decrease in quarterly revenue, profit margins contracted due to the effect of operating leverage on our income. We increased our cash balance while investing in organic growth and returning cash to our shareholders through share repurchases, ending 2020 in a strong financial position. Our expectations are for another growth year in 2021, with high single-digit percent growth in revenue and an up-tick in operating profit similar to the 23% increase achieved in 2020.

First Quarter 2021 Guidance

For the first quarter of 2021, Photronics expects revenue to be between $145 million and $155 million, and net income attributable to Photronics, Inc. shareholders to be between $0.07 and $0.14 per diluted share.

Conference Call

A conference call to discuss these results is scheduled for 8:30 a.m. Eastern time on Wednesday, December 9, 2020. The call can be accessed by logging onto Photronics' website at www.photronics.com. The live dial-in number is (877) 377-7095 or (408) 774-4601 outside of the United States and Canada. The call will be archived on Photronics website.

Investor and Analyst Day

Photronics will host an investor and analyst day on December 14, 2020. The event will be conducted virtually and feature updates from management and a Q&A session. More information can be found on the Investors section of Photronics' website at www.photronics.com.

About Photronics

Photronics is a leading worldwide manufacturer of integrated circuit (IC) and flat panel display (FPD) photomasks. High precision quartz plates that contain microscopic images of electronic circuits, photomasks are a key element in the IC and FPD manufacturing process. Founded in 1969, Photronics has been a trusted photomask supplier for over 50 years. As of October 31, 2020, the company had 1,728 employees. The company operates 11 strategically located manufacturing facilities in Asia, Europe, and North America. Additional information on the company can be accessed at www.photronics.com.

Forward-Looking Statements

Certain statements in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of the company and its subsidiaries. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of Photronics to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Statements preceded by, followed by or that otherwise include the words believes, expects, anticipates, intends, projects, estimates, plans, may increase, may fluctuate, will, should, would, may and could or similar words or expressions are generally forward-looking in nature and not historical facts. Any statements that refer to outlook, expectations or other characterizations of future events, circumstances or results are also forward-looking statements. Important risks, assumptions and other important factors that could cause future results to differ materially from those expressed in the forward-looking statements are specified in Photronics Annual and Quarterly filings with the Securities and Exchange Commission under headings such as Forward-Looking Statements, Risk Factors and Managements Discussion and Analysis of Financial Condition and Results of Operations and in other filings and furnishings made by Photronics with the Securities and Exchange Commission from time to time. These risks and uncertainties include, but are not limited to, the current pandemic and future recurrences and other developments with respect thereto, governmental responses to the pandemic and related matters, changes in end markets resulting therefrom, changes in investment, tax, trade, exchange and other laws and regulations, compliance with local, State and Federal laws, rules and regulations including, but not limited to, import and export controls, tariffs and penalties, fines and violations related thereto, as well as economic, competitive, legal, governmental, political, monetary and fiscal policy, and technological factors and decisions we may make in the future regarding our business, capital structure and other matters. Photronics undertakes no obligation to release publicly any revisions to any forward-looking statements or, except as required to be disclosed in filings or furnishings with the Securities and Exchange Commission, to report events or to report the occurrence of unanticipated events. There is no assurance that Photronics expectations will be realized.

PHOTRONICS, INC.Condensed Consolidated Statements of Income(in thousands, except per share amounts)(Unaudited)

Three Months Ended Year Ended October 31, August 2, October 31, October 31, October 31, 2020 2020 2019 2020 2019 Revenue $ 149,286 $ 157,895 $ 156,257 $ 609,691 $ 550,660 Cost of goods 117,401 120,161 118,098 475,037 429,819 sold Gross profit 31,885 37,734 38,159 134,654 120,841 Operating Expenses: Selling, generaland 12,790 13,306 12,140 53,582 52,326 administrative Research and 4,110 4,492 4,543 17,144 16,394 development TotalOperating 16,900 17,798 16,683 70,726 68,720 Expenses Operating 14,985 19,936 21,476 63,928 52,121 income Other(expense) (2,937 ) (2,135 ) (6,111 ) (2,327 ) (1,420 )income, net Income beforeincome tax 12,048 17,801 15,365 61,601 50,701 provision Income tax 3,469 4,937 2,327 21,258 10,210 provision Net income 8,579 12,864 13,038 40,343 40,491 Net incomeattributable to 2,119 2,088 3,338 6,523 10,698 noncontrollinginterests Net incomeattributable to $ 6,460 $ 10,776 $ 9,700 $ 33,820 $ 29,793 Photronics, Inc.shareholders Earnings per share: Basic $ $ $ $ $ 0.10 0.17 0.15 0.52 0.45 Diluted $ $ $ $ $ 0.10 0.17 0.15 0.52 0.44 Weighted-averagenumber of common sharesoutstanding: Basic 64,193 64,780 66,230 64,866 66,347 Diluted 64,768 65,247 66,862 65,470 69,155

PHOTRONICS, INC.Condensed Consolidated Balance Sheets(in thousands)(Unaudited)

October 31, October 31, 2020 2019 Assets Current assets: Cash and cash equivalents $ 278,665 $ 206,530 Accounts receivable 134,470 134,454 Inventories 57,269 48,155 Other current assets 29,735 38,388 Total current assets 500,139 427,527 Property, plant and equipment, net 631,475 632,441 Intangible assets, net 3,437 7,870 Other assets 53,131 50,827 Total assets $ 1,188,182 $ 1,118,665 Liabilities and Equity Current liabilities: Debt $ 13,678 $ 10,873 Accounts payable and accrued liabilities 129,261 141,081 Total current liabilities 142,939 151,954 Long-term debt 54,980 41,887 Other liabilities 27,997 13,732 Photronics, Inc. shareholders' equity 804,962 769,892 Noncontrolling interests 157,304 141,200 Total equity 962,266 911,092 Total liabilities and equity $ 1,188,182 $ 1,118,665

PHOTRONICS, INC.Condensed Consolidated Statements of Cash Flows(in thousands)(Unaudited) Year Ended October 31, October 31, 2020 2019 Cash flows from operating activities:Net income $ $ 40,343 40,491Adjustments to reconcile net income to net cashprovided by operating activities: Depreciation and amortization 93,814 83,879 Share-based compensation 4,927 3,680 Changes in operating assets, 3,962 (59,664 )liabilities and other Net cash provided by operating 143,046 68,386 activities Cash flows from investing activities:Purchases of property, plant and (70,815 ) (178,375 )equipmentGovernment incentive 5,263 27,003 Other (159 ) (34 ) Net cash used in investing (65,711 ) (151,406 )activities Cash flows from financing activities:Proceeds from debt 20,340 54,633 Contributions from noncontrolling 17,596 29,394 interestPurchases of treasury stock (34,394 ) (21,696 )Dividends paid to noncontrolling (16,151 ) (45,050 )interestsRepayments of debt (7,392 ) (61,319 )Proceeds from share-based 4,239 2,071 arrangementsOther (248 ) (92 ) Net cash used in financing (16,010 ) (42,059 )activities Effect of exchange rate changes oncash, cash equivalents, and 10,986 2,381 restricted cash Net increase (decrease) in cash,cash equivalents, and restricted 72,311 (122,698 )cashCash, cash equivalents, and 209,291 331,989 restricted cash, beginning of period Cash, cash equivalents, and $ $ restricted cash, end of period 281,602 209,291