PR Newswire | Feb 2, 2021 04:06PM EST

December 31, 2020, and Announces Quarterly Cash Dividend

02/02 15:05 CST

Brooks Automation Reports Results of First Quarter of Fiscal 2021, Ended December 31, 2020, and Announces Quarterly Cash DividendStrong Revenue Growth and Margin Expansion Year Over Year In Both Life Sciences and Semiconductor Solutions CHELMSFORD, Mass., Feb. 2, 2021

CHELMSFORD, Mass., Feb. 2, 2021 /PRNewswire/ -- Brooks Automation, Inc. (Nasdaq: BRKS) today reported financial results for the first fiscal quarter of 2021, ended December 31, 2020.





Financial Results Summary



Quarter Ended

Dollars in millions, December 31, September 30, December 31, Change vs. except per share data

2020 2020 2019 Prior Qtr Prior Year

Revenue $250 $246 $210 1 %19 %

Semiconductor $131 $138 $119 (5) %11 %Solutions

Life Sciences $118 $108 $92 9 %29 %



Diluted EPS Continuing$0.36 $0.39 $0.18 (7) %103 %Operations

Diluted EPS Total $0.35 $0.39 $0.18 (11) %98 %



Non-GAAP Diluted EPS $0.47 $0.47 $0.23 1 %108 %Continuing Operations



Adjusted EBITDA $58 $54 $32 7 %81 %





Management Comments"We are very pleased with the results of our first quarter of 2021 as we continued our trajectory of strong profitable growth," commented Steve Schwartz, president and CEO. "Our life sciences business had another exceptional quarter, driven by both product and services offerings. Semiconductor remains robust and is poised to accelerate in the second quarter given a healthy order backlog and market tailwinds."

Summary of GAAP ResultsFirst Quarter, Fiscal 2021

* Revenue for the first quarter was $250 million, up 19% year over year, supported by growth in both Life Sciences and Semiconductor Solutions. Diluted EPS from continuing operations was $0.36 per share compared to $0.18 per share in the first quarter of 2020. * Life Sciences revenue of $118 million grew 29% year over year. Year-over-year organic growth was 32%. Life Sciences Products grew 53% year over year, and Life Sciences Services grew 17%. Life Sciences Services increased 28%, excluding the effect of the recent exit of the RUCDR alliance. * Semiconductor Solutions revenue was $131 million, an increase of 11% year over year. * GAAP operating income was $31 million, compared to $11 million in the first quarter of 2020. GAAP operating margin was 12.4%, up 730 basis points year over year.

Summary of Non-GAAP Results for Continuing OperationsFirst Quarter, Fiscal 2021

* Diluted EPS for the first quarter was $0.47, up 108% year over year. * Operating income was $44 million, an increase of 99% year over year, and operating margin was 17.5%, up 710 basis points year over year. Gross margin of 46.3% was up 470 basis points year over year and was the primary contributor to the operating margin improvement. Year-over-year gross margin expansion in both Life Sciences and Semiconductor Solutions drove this improvement. * Life Sciences operating margin was 18.8%, up from 6.5% in the prior year. The year-over-year improvement was driven by gross margin of 50.2%, up 590 basis points year over year. An additional 640 basis points improvement came from the leverage of operating expense which grew only 7% to support the 29% revenue growth. The 590 basis point year-over-year improvement in Life Sciences gross margin was driven by the Products business, up 310 basis points, and the Services business, up 790 basis points. The favorable mix effect of unwinding the RUCDR alliance agreement drove 210 basis points of the total Life Sciences business gross margin improvement while 380 basis points of the increase was due to performance improvement. * Semiconductor Solutions operating margin was 16.4%, an increase of 380 basis points from the prior year. Gross margin was 42.8%, up 320 basis points year over year, primarily driven by growth and favorable mix in vacuum robots compared to the prior year. * Adjusted EBITDA was $58 million, up 81% from the first quarter of 2020 and 7% sequentially.

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.

Cash and Liquidity

* Cash flow from operations was $44 million for the quarter, an increase of $18 million year over year. * The Company ended the first fiscal quarter of 2021 with a total balance of cash, cash equivalents, restricted cash, and marketable securities of $323 million. With total debt of $50 million, net cash was $272 million.

Quarterly Cash DividendThe Company additionally announced that the Board of Directors has reiterated a dividend of $0.10 per share payable on March 26, 2021 to stockholders of record on March 5, 2021. 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 Second Quarter Fiscal 2021The Company announced revenue and earnings guidance for the second quarter of fiscal 2021. Revenue is expected to be in the range of $267 million to $283 million and non-GAAP diluted earnings per share is expected to be in the range of $0.48 to $0.57. GAAP diluted earnings per share for the second fiscal quarter is expected to be in the range of $0.33 to $0.42

Conference Call and WebcastBrooks management will webcast its first quarter 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 www.brooks.investorroom.com, and will be archived online on this website for convenient on-demand replay. In addition, you may call 800-734-8583 (US & Canada only) or +1-212-231-2904 for international callers to listen to the live webcast.

Regulation G - Use of Non-GAAP financial MeasuresThe 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 1934Some 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 about our revenue and earnings expectations, our ability to increase our profitability, our ability to improve or retain our market position, and our ability to deliver financial success in the future. Factors that could cause results to differ from our expectations include the following: the impact of the COVID-19 global pandemic on the markets we serve, including our supply chain, and on the global economy generally, 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 AutomationBrooks (Nasdaq: BRKS) is a leading provider of life science sample-based solutions and semiconductor manufacturing solutions worldwide. The Company's Life Sciences business provides a full suite of reliable cold-chain sample management solutions and genomic services across areas such as drug development, clinical research and advanced cell therapies for the industry's top pharmaceutical, biotech, academic and healthcare institutions globally. Brooks Life Sciences' GENEWIZ division is a leading provider of gene sequencing and gene synthesis services. With over 40 years as a partner to the semiconductor manufacturing industry, Brooks is a provider of industry-leading precision vacuum robotics, integrated automation systems and contamination control solutions to the world's leading semiconductor chip makers and equipment manufacturers. Brooks is headquartered in Chelmsford, MA, with operations in North America, Europe and Asia. For more information, visit www.brooks.com.

BROOKS INVESTOR CONTACTS:

Sara SilvermanDirector of Investor RelationsBrooks Automation978.262.2635sara.silverman@brooks.com

Sherry DinsmoreBrooks Automation978.262.4301sherry.dinsmore@brooks.com

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





Three Months Ended

December 31,

2020 2019

Revenue

Products $159,616$131,862

Services 89,887 78,638

Total revenue 249,503 210,500

Cost of revenue

Products 91,503 79,971

Services 44,872 45,543

Total cost of revenue 136,375 125,514

Gross profit 113,128 84,986

Operating expenses

Research and development 16,083 14,401

Selling, general and administrative 66,030 59,343

Restructuring charges 87 576

Total operating expenses 82,200 74,320

Operating income 30,928 10,666

Interest income 76 699

Interest expense (556) (737)

Other income (expenses), net 1,329 (417)

Income before income taxes 31,777 10,211

Income tax benefit 4,770 (2,963)

Income from continuing operations 27,007 13,174

Loss from discontinued operations, net of tax (979) (117)

Net income $26,028 $13,057

Basic net income per share:

Income from continuing operations $0.35 $0.18

Loss from discontinued operations, net of tax (0.01) (0.00)

Basic net income per share $0.35 $0.18

Diluted net income per share:

Income from continuing operations $0.36 $0.18

Loss from discontinued operations, net of tax (0.01) (0.00)

Diluted net income per share $0.35 $0.18



Weighted average shares outstanding used in computing net income per share:

Basic 74,021 72,972

Diluted 74,283 73,645



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





December 31, September 30,

2020 2020



Assets

Current assets

Cash and cash equivalents $308,517 $295,649

Marketable securities 55 67

Accounts receivable, net 196,679 188,291

Inventories 123,917 114,834

Prepaid expenses and other current assets 45,988 50,612

Total current assets 675,156 649,453

Property, plant and equipment, net 126,947 117,665

Long-term marketable securities 3,410 3,101

Long-term deferred tax assets 4,765 4,979

Goodwill 512,989 501,536

Intangible assets, net 219,866 218,325

Other assets 71,599 64,066

Total assets $1,614,732 $1,559,125

Liabilities and Stockholders' Equity

Current liabilities

Current portion of long-term debt $414 $827

Accounts payable 67,811 61,758

Deferred revenue 35,661 31,357

Accrued warranty and retrofit costs 8,228 8,201

Accrued compensation and benefits 31,693 43,267

Accrued restructuring costs 106 181

Accrued income taxes payable 15,972 10,094

Accrued expenses and other current liabilities 65,885 55,433

Total current liabilities 225,770 211,118

Long-term debt 49,629 49,588

Long-term tax reserves 19,458 19,168

Long-term deferred tax liabilities 15,132 17,798

Long-term pension liabilities 6,741 6,406

Long-term operating lease liabilities 34,173 31,855

Other long-term liabilities 11,675 9,578

Total liabilities 362,578 345,511

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, 87,672,132 shares issued and 74,210,263 shares outstanding at 877 873 December 31, 2020, 87,293,710 shares issued and 73,831,841 shares outstanding at September 30, 2020

Additional paid-in capital 1,949,556 1,942,850

Accumulated other comprehensive income 35,145 21,919

Treasury stock at cost - 13,461,869 shares (200,956) (200,956)

Accumulated deficit (532,468) (551,072)

Total stockholders' equity 1,252,154 1,213,614

Total liabilities and stockholders' equity $1,614,732 $1,559,125

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





Three Months Ended

December 31,

2020 2019

Cash flows from operating activities

Net income $26,028 $13,057

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 15,746 16,477

Stock-based compensation 6,710 4,410

Amortization of premium on marketable securities and 56 67 deferred financing costs

Deferred income taxes (4,960) (8,183)

Other gains on disposals of assets 1 126

Adjustment to the gain on divestiture, net of tax 948 319

Changes in operating assets and liabilities, net of acquisitions:

Accounts receivable (4,504) 1,503

Inventories (6,307) (4,335)

Prepaid expenses and current assets 28,945 6,120

Accounts payable 5,727 5,255

Deferred revenue 3,186 (720)

Accrued warranty and retrofit costs (185) 221

Accrued compensation and tax withholdings (12,307) (5,755)

Accrued restructuring costs (75) (203)

Accrued expenses and current liabilities (15,279) (2,616)

Net cash provided by operating activities 43,730 25,743

Cash flows from investing activities

Purchases of property, plant and equipment (15,227) (9,614)

Purchases of marketable securities (4) (10,742)

Maturities of marketable securities - 33,584

Acquisitions, net of cash acquired (15,061) -

Net cash (used in) provided by investing activities (30,292) 13,228

Cash flows from financing activities

Principal payments on debt (414) (414)

Payments of finance leases (319) (319)

Common stock dividends paid (7,424) (7,369)

Net cash used in financing activities (8,157) (8,102)

Effects of exchange rate changes on cash and cash 11,250 2,808 equivalents

Net increase in cash and cash equivalents 16,531 33,677

Cash, cash equivalents and restricted cash, beginning 302,526 305,171 of period

Cash and cash equivalents and restricted cash, end of $319,057 $338,848 period



Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets

Cash and cash equivalents $308,517 $335,319

Short-term restricted cash included in prepaid 3,571 3,529 expenses and other current assets

Long-term restricted cash included in other assets 6,969 -

Total cash, cash equivalents and restricted cash shown$319,057 $338,848 in the consolidated statements of cash flows

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. 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

December 31, 2020 September 30, 2020 December 31, 2019

per diluted per diluted per diluted

Dollars in thousands, except per share data $ share $ share $ share

Net income from continuing operations $27,007 $0.36 $28,973 $0.39 $13,174 $0.18

Adjustments:

Amortization of intangible assets 9,745 0.13 10,442 0.14 10,584 0.14

Restructuring charges 87 0.00 241 0.00 576 0.01

Merger costs 2,991 0.04 19 0.00 195 0.00

Tax adjustments ^(1) (1,999) (0.03) (800) (0.01) (5,230) (0.07)

Tax effect of adjustments (2,880) (0.04) (4,369) (0.06) (2,662) (0.04)

Non-GAAP adjusted net income from continuing $34,951 $0.47 $34,506 $0.47 $16,637 $0.23 operations

Stock based compensation, pre-tax 6,710 0.09 3,969 0.05 4,410 0.06

Tax rate 15 % - 15 % - 15 % -

Stock-based compensation, net of tax 5,704 0.08 3,374 0.05 3,749 0.05

Non-GAAP adjusted net income excluding $40,655 $0.55 $37,880 $0.51 $20,386 $0.28 stock-based compensation - continuing operations



Shares used in computing non-GAAP diluted net - 74,283 - 74,004 - 73,645 income per share

The Company elected to apply the tax benefit related to the stock compensation windfall realized in the quarters ended December 31, 2020 and(1) 2019 to the non-GAAP full year tax rate. The Company elected to exclude a deferred tax benefit realized in the three month period ended December 31, 2019 related to the extension of the 15 percent tax rate incentive in China.



Quarter Ended

December 31, September 30,December 31,

Dollars in thousands 2020 2020 2019

GAAP net income $26,028 $28,973 $13,057

Adjustments:

Less: Loss (income) from 979 - 117 discontinued operations

Less: Interest income (76) 16 (699)

Add: Interest expense 556 679 737

Add: Income tax benefit 4,770 4,380 (2,963)

Add: Depreciation 6,001 5,295 5,891

Add: Amortization of completed 2,389 2,813 2,674 technology

Add: Amortization of customer relationships and acquired 7,356 7,629 7,910 intangible assets

Earnings before interest, taxes, depreciation and $48,003 $49,785 $26,724 amortization



Quarter Ended

December 31, September 30,December 31,

Dollars in thousands 2020 2020 2019

Earnings before interest, taxes, depreciation and $48,003 $49,785 $26,724 amortization

Adjustments:

Add: Stock-based compensation 6,710 3,969 4,410

Add: Restructuring charges 87 240 576

Add: Merger costs 2,991 19 195

Adjusted earnings before interest, taxes, depreciation $57,791 $54,013 $31,905 and amortization



Quarter Ended

Dollars in December 31, 2020September 30, 2020 December 31, 2019thousands

GAAP gross profit/ $113,12845.3%$ 111,96945.5% $84,98640.4% margin percentage

Adjustments:

Amortization of completed 2,389 1.0 2,813 1.1 2,674 1.3 technology

Non-GAAP adjusted gross profit/gross $115,51746.3%$ 114,78246.6% $87,66041.6% margin percentage





Brooks Semiconductor Solutions Group

Quarter Ended

Dollars in December 31, 2020 September 30, 2020December 31, 2019 thousands

GAAP gross profit/ $ 55,78942.5% $ 59,43543.1% $ 46,30039.0% margin percentage

Adjustments:

Amortization of completed 384 0.3 736 0.5 732 0.6 technology

Non-GAAP adjusted gross profit/margin$ 56,17342.8% $ 60,17143.6% $ 47,03239.6% percentage



Brooks Life Sciences Products Brooks Life Sciences Services

Quarter Ended Quarter Ended

Dollars in December 31, 2020 September 30, 2020December 31, 2019 December 31, 2020 September 30, 2020December 31, 2019 thousands

GAAP gross profit/ $ 20,53145.1% $ 16,70143.2% $ 12,37841.6% $ 36,81050.7% $ 35,83251.5% $ 26,30842.5% margin percentage

Adjustments:

Amortization of completed 273 0.6 293 0.8 292 1.0 1,732 2.4 1,784 2.6 1,650 2.7 technology

Non-GAAP adjusted gross profit$ 20,80445.7% $ 16,99444.0% $ 12,67042.6% $ 38,54253.1% $ 37,61654.0% $ 27,95845.1% /margin percentage





Brooks Life Sciences Total

Quarter Ended

Dollars in December 31, 2020 September 30, 2020December 31, 2019 thousands

GAAP gross profit/ $ 57,34148.5% $ 52,53348.5% $ 38,68642.1% margin percentage

Adjustments:

Amortization of completed 2,005 1.7 2,077 1.9 1,942 2.1 technology

Non-GAAP adjusted gross profit/margin$ 59,34650.2% $ 54,61050.5% $ 40,62844.3% percentage



Brooks Semiconductor Solutions GroupBrooks Life Sciences ProductsBrooks Life Sciences ServicesBrooks Life Sciences Total

Quarter Ended Quarter Ended Quarter Ended Quarter Ended

Dec 31, Sept 30, Dec 31, Dec 31, Sept 30, Dec 31,Dec 31, Sept 30,Dec 31, Dec 31, Sept 30,Dec 31,

Dollars in thousands 2020 2020 2019 2020 2020 2019 2020 2020 2019 2020 2020 2019

GAAP operating profit$ 21,154 $ 27,094 $ 14,268 $ 7,669 $ 4,072 $ 69 $12,579 $11,353$3,963 $20,248$15,425$4,032

Adjustments:

Amortization of 384 736 732 273 293 292 1,732 1,784 1,650 2,005 2,077 1,942completed technology

Non-GAAP adjusted $ 21,538 $ 27,830 $ 15,000 $ 7,942 $ 4,365 $ 361 $14,311 $13,137$5,613 $22,253$17,502$5,974operating profit



Total Segments Corporate Total

Quarter Ended Quarter Ended Quarter Ended

Dec 31, Sept 30,Dec 31, Dec 31, Sept 30, Dec 31, Dec 31, Sept 30,Dec 31,

Dollars in thousands2020 2020 2019 2020 2020 2019 2020 2020 2019

GAAP operating $41,402$42,519$18,300$(10,474)$(8,398)$(7,634)$30,928$34,121$10,666profit (loss)

Adjustments:

Amortization of 2,389 2,813 2,674 - - - 2,389 2,813 2,674 completed technology

Amortization of customer relationships and - - - 7,356 7,629 7,910 7,356 7,629 7,910 acquired intangible assets

Restructuring - - - 87 241 576 87 241 576 charges

Merger costs - - - 2,991 19 195 2,991 19 195

Non-GAAP adjusted operating profit $43,791$45,332$20,974$(40) $(509) $1,047 $43,751$44,823$22,021(loss)



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