Business Wire | Aug 4, 2021 04:06PM EDT

Amtech Reports Third Quarter Fiscal 2021 Results

Aug. 04, 2021

TEMPE, Ariz.--(BUSINESS WIRE)--Aug. 04, 2021--Amtech Systems, Inc. (NASDAQ: ASYS), a manufacturer of capital equipment, including thermal processing and wafer polishing, and related consumables used in fabricating semiconductor devices, such as silicon carbide (SiC) and silicon power devices, analog and discrete devices, electronic assemblies and light-emitting diodes (LEDs), today reported results for its third quarter ended June 30, 2021.

Third Quarter Fiscal 2021 Financial and Operational Highlights:

* Net revenue of $23.1 million * Operating income of $1.2 million, inclusive of approximately $1.1 million of SG&A expenses related to our cybersecurity incident in April 2021 * Income from continuing operations, net of tax, of $0.4 million * Income per diluted share of $0.03 * Customer orders of $30.9 million * June 30, 2021 backlog of $34.3 million * Book to bill ratio of 1.3:1 * Unrestricted cash of $37.0 million

Mr. Michael Whang, Chief Executive Officer of Amtech, commented, "Our strong momentum continued in the third quarter, with revenue growing 17% sequentially and 52% year over year. Broad-based demand for our Semiconductor products remains strong, while the resumption of Material and Substrate equipment purchases signals a growing confidence in our customers' outlook. Combined with the longer-term growth opportunities created by power semiconductors, advanced packaging, automotive electronics, electric vehicles, and 5G communications, we believe our leadership position in the markets we serve will drive growth and profitability in the years ahead."

GAAP Financial Results

(in millions, except Q3 Q2 Q3 9 9 per share amounts) Months Months

FY FY 2021 FY 2020 2021 2020 2021

Net revenues $ 23.1 $ 19.8 $ 15.2 $ 60.9 $ 50.4

Gross profit $ 10.1 $ 7.7 $ 6.0 $ 25.3 $ 19.5

Gross margin 43.6 % 39.1 % 39.1 % 41.6 % 38.7 %

Operating income $ 1.2 $ 0.2 $ 0.0 $ 2.4 $ 0.7

Operating margin 5.2 % 0.9 % 0.2 % 4.0 % 1.4 %

Income (loss) fromcontinuing operations, $ 0.4 $ (0.2 ) $ (0.1 ) $ 0.8 $ (1.9 )net of tax

Diluted income (loss)per share from $ 0.03 $ (0.02 ) $ (0.01 ) $ 0.06 $ (0.13 )continuing operations

Net revenues increased 17% sequentially and increased 52% from the third quarter of fiscal 2020, with the sequential increase primarily attributed to strong shipments of our advanced packaging and SMT equipment and increased shipments of our polishing machines. The same prior year period was affected by the COVID-19 pandemic. IDI accounted for approximately $534,000 of the third quarter fiscal 2021 revenue.

Gross margin increased in the third quarter of fiscal 2021 sequentially and compared to prior year due to product mix and increased capacity utilization, partially offset by rising labor and material costs.

Selling, General & Administrative ("SG&A") expenses increased $1.6 million sequentially and $2.5 million compared to the same prior year period due primarily to approximately $1.1 million in expenses related to the cyber incident in April 2021, a majority of which will be claimed with our cyber insurance carrier, as well as increased commissions on higher sales. Also, the third quarter of fiscal 2021 includes IDI for the full period. Additionally, the prior year quarter benefited from $0.3 million COVID payroll tax credits and had lower travel and trade show expenses due to COVID.

Research and Development decreased $0.3 million sequentially and increased $0.6 million compared to the same prior year period due primarily to the timing of materials used in our strategic R&D projects.

Operating income was $1.2 million, compared to operating income of $0.2 million in the second quarter of fiscal 2021 and operating income of less than $0.1 million in the same prior year period.

Income tax provision was $0.7 million for the three months ended June 30, 2021, compared to a provision of $0.5 million in the preceding quarter and $0.1 million in the same prior year period.

Income from continuing operations, net of tax, for the third quarter of fiscal 2021 was $0.4 million, or 3 cents per share. This compares to loss from continuing operations of $0.1 million, or 1 cent per share, for the third quarter of fiscal 2020 and loss of $0.2 million, or 2 cent per share, in the preceding quarter.

Outlook

The Company's outlook reflects the anticipated ongoing logistical impacts and the related delays for goods shipped to and from China. Actual results may differ materially in the weeks and months ahead. Additionally, the semiconductor equipment industries can be cyclical and inherently impacted by changes in market demand. Operating results can be significantly impacted, positively or negatively, by the timing of orders, system shipments, and the financial results of semiconductor manufacturers.

For the fourth fiscal quarter ending September 30, 2021, revenues are expected to be in the range of $25 to $27 million. Gross margin for the quarter ending September 30, 2021 is expected to be in the upper 30% range due to a shift in product mix, with operating margin in the mid to upper single digits.

A portion of Amtech's results is denominated in Renminbis, a Chinese currency. The outlook provided in this press release is based on an assumed exchange rate between the United States Dollar and the Renminbi. Changes in the value of the Renminbi in relation to the United States Dollar could cause actual results to differ from expectations.

Conference Call

Amtech Systems will host a conference call today at 5:00 p.m. ET to discuss our fiscal third quarter financial results. The call will be available to interested parties by dialing 800-437-2398. For international callers, please dial +1 929-477-0577. The confirmation code is 7973960. A live webcast of the conference call will be available in the Investor Relations section of Amtech's website at: https://www.amtechsystems.com/investors/events.

A replay of the webcast will be available in the Investor Relations section of the company's web site at http://www.amtechsystems.com/conference.htm shortly after the conclusion of the call and will remain available for approximately 30 calendar days.

About Amtech Systems, Inc.

Amtech Systems, Inc. is a leading, global manufacturer of capital equipment, including thermal processing and wafer polishing, and related consumables used in fabricating semiconductor devices, such as silicon carbide (SiC) and silicon power devices, analog and discrete devices, electronic assemblies and light-emitting diodes (LEDs). We sell these products to semiconductor device and module manufacturers worldwide, particularly in Asia, North America and Europe. Our strategic focus is on semiconductor growth opportunities in power electronics, sensors and analog devices leveraging our strength in our core competencies in thermal and substrate processing. We are a market leader in the high-end power chip market (SiC substrates, 300mm horizontal thermal reactor, and electronic assemblies used in power, RF, and other advanced applications), developing and supplying essential equipment and consumables used in the semiconductor industry. Amtech's products are recognized under the leading brand names BTU International, Bruce Technologies(tm), PR Hoffman(tm) and Intersurface Dynamics, Inc.

Cautionary Note Regarding Forward-Looking Statements

Certain information contained in this press release is forward-looking in nature. All statements in this press release, or made by management of Amtech Systems, Inc. and its subsidiaries ("Amtech"), other than statements of historical fact, are hereby identified as "forward-looking statements" (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995). The forward-looking statements in this press release relate only to events or information as of the date on which the statements are made in this press release. Examples of forward-looking statements include statements regarding Amtech's future financial results, operating results, business strategies, projected costs, products under development, competitive positions, plans and objectives of Amtech and its management for future operations, efforts to improve operational efficiencies and effectiveness and profitably grow our revenue, and enhancements to our technologies and expansion of our product portfolio. In some cases, forward-looking statements can be identified by terminology such as "may," "plan," "anticipate," "seek," "will," "expect," "intend," "estimate," "believe," "continue," "predict," "potential," "project," "should," "would," "could", "likely," "future," "target," "forecast," "goal," "observe," and "strategy" or the negative of these terms or other comparable terminology used in this press release or by our management, which are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. The Form 10-K that Amtech filed with the Securities and Exchange Commission (the "SEC") for the year-ended September 30, 2020, listed various important factors that could affect the Company's future operating results and financial condition and could cause actual results to differ materially from historical results and expectations based on forward-looking statements made in this document or elsewhere by Amtech or on its behalf. These factors can be found under the heading "Risk Factors" in the Form 10-K and investors should refer to them. Because it is not possible to predict or identify all such factors, any such list cannot be considered a complete set of all potential risks or uncertainties. Except as required by law, we undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events, or otherwise.

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

August 4, 2021

(Unaudited)



Summary Financial Information for Continuing Operations

(in thousands, except percentages and ratios)

Three Months Ended Nine Months Ended June 30,

June 30, March June 30, 2021 31, 2020 2021 2020 2021

Amtech Systems, Inc.

Revenues, netof returns $ 23,100 $ 19,790 $ 15,227 $ 60,865 $ 50,379 andallowances

Gross profit $ 10,079 $ 7,728 $ 5,951 $ 25,319 $ 19,483

Gross margin 44 % 39 % 39 % 42 % 39 %

Operating $ 1,204 $ 171 $ 31 $ 2,429 $ 696 income

New orders $ 30,861 $ 32,526 $ 10,830 $ 81,256 $ 49,081

Backlog $ 34,295 $ 26,534 $ 15,221 $ 34,295 $ 15,221

Semiconductor Segment

Revenues, netof returns $ 19,501 $ 17,119 $ 12,357 $ 52,195 $ 41,581 andallowances

Gross profit $ 8,599 $ 7,093 $ 4,953 $ 22,604 $ 16,552

Gross margin 44 % 41 % 40 % 43 % 40 %

Operating $ 2,114 $ 1,665 $ 1,058 $ 5,976 $ 3,762 income

New orders $ 26,607 $ 29,651 $ 8,356 $ 71,741 $ 40,469

Backlog $ 32,388 $ 25,281 $ 13,798 $ 32,388 $ 13,798

Material andSubstrate Segment

Revenues, netof returns $ 3,599 $ 2,671 $ 2,870 $ 8,670 $ 8,155 andallowances

Gross profit $ 1,480 $ 635 $ 998 $ 2,715 $ 2,922

Gross margin 41 % 24 % 35 % 31 % 36 %

Operating $ 333 $ (253 ) $ 241 $ 14 $ 1,196 income (loss)

New orders $ 4,254 $ 2,875 $ 2,474 $ 9,515 $ 8,612

Backlog $ 1,907 $ 1,253 $ 1,423 $ 1,907 $ 1,423

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

August 4, 2021

(Unaudited)

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

Three Months Ended June 30,

Nine Months Ended June 30,

2021

2020

2021

2020

Revenues, net of returns and allowances

$

23,100

$

15,227

$

60,865

$

50,379

Cost of sales

13,021

9,276

35,546

30,896

Gross profit

10,079

5,951

25,319

19,483

Selling, general and administrative

7,281

4,804

18,182

16,134

Research, development and engineering

1,523

899

4,637

2,436

Restructuring charges

71

217

71

217

Operating income

1,204

31

2,429

696

Loss on sale of subsidiary

-

-

-

(2,793

)

Interest (expense) income and other, net

(155

)

(13

)

(337

)

512

Income (loss) from continuing operations before income taxes

1,049

18

2,092

(1,585

)

Income tax provision

680

90

1,250

297

Income (loss) from continuing operations, net of tax

369

(72

)

842

(1,882

)

Loss from discontinued operations, net of tax

-

-

-

(11,816

)

Net income (loss)

$

369

$

(72

)

$

842

$

(13,698

)

Income (Loss) Per Basic Share:

Basic income (loss) per share from continuing operations

$

0.03

$

(0.01

)

$

0.06

$

(0.13

)

Basic loss per share from discontinued operations

$

-

$

-

$

-

$

(0.83

)

Net income (loss) per basic share

$

0.03

$

(0.01

)

$

0.06

$

(0.96

)

Income (Loss) Per Diluted Share:

Diluted income (loss) per share from continuing operations

$

0.03

$

(0.01

)

$

0.06

$

(0.13

)

Diluted loss per share from discontinued operations

$

-

$

-

$

-

$

(0.83

)

Net income (loss) per diluted share

$

0.03

$

(0.01

)

$

0.06

$

(0.96

)

Weighted average shares outstanding - basic

14,176

14,155

14,163

14,195

Weighted average shares outstanding - diluted

14,373

14,155

14,292

14,195

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

August 4, 2021

(Unaudited)



Condensed Consolidated Statements of Operations

(in thousands, except per share data)

Three Months Ended Nine Months Ended June June 30, 30,

2021 2020 2021 2020

Revenues, net of returns $ 23,100 $ 15,227 $ 60,865 $ 50,379 and allowances

Cost of sales 13,021 9,276 35,546 30,896

Gross profit 10,079 5,951 25,319 19,483



Selling, general and 7,281 4,804 18,182 16,134 administrative

Research, development and 1,523 899 4,637 2,436 engineering

Restructuring charges 71 217 71 217

Operating income 1,204 31 2,429 696



Loss on sale of subsidiary - - - (2,793 )

Interest (expense) income (155 ) (13 ) (337 ) 512 and other, net

Income (loss) fromcontinuing operations 1,049 18 2,092 (1,585 )before income taxes

Income tax provision 680 90 1,250 297

Income (loss) fromcontinuing operations, net 369 (72 ) 842 (1,882 )of tax

Loss from discontinued - - - (11,816 )operations, net of tax

Net income (loss) $ 369 $ (72 ) $ 842 $ (13,698 )



Income (Loss) Per Basic Share:

Basic income (loss) pershare from continuing $ 0.03 $ (0.01 ) $ 0.06 $ (0.13 )operations

Basic loss per share from $ - $ - $ - $ (0.83 )discontinued operations

Net income (loss) per $ 0.03 $ (0.01 ) $ 0.06 $ (0.96 )basic share



Income (Loss) Per Diluted Share:

Diluted income (loss) pershare from continuing $ 0.03 $ (0.01 ) $ 0.06 $ (0.13 )operations

Diluted loss per sharefrom discontinued $ - $ - $ - $ (0.83 )operations

Net income (loss) per $ 0.03 $ (0.01 ) $ 0.06 $ (0.96 )diluted share



Weighted average shares 14,176 14,155 14,163 14,195 outstanding - basic

Weighted average shares 14,373 14,155 14,292 14,195 outstanding - diluted

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

August 4, 2021

(Unaudited)

Condensed Consolidated Balance Sheets

(in thousands, except share data)

June 30, 2021

September 30, 2020

Assets

Current Assets

Cash and cash equivalents

$

37,040

$

45,070

Accounts receivable (less allowance for doubtful accounts of $138 and $159 at June 30, 2021, and September 30, 2020, respectively)

20,893

11,243

Inventories

20,528

17,277

Income taxes receivable

1,057

1,362

Other current assets

1,894

1,617

Total current assets

81,412

76,569

Property, Plant and Equipment - Net

12,007

11,995

Right-of-Use Assets - Net

8,789

5,124

Intangible Assets - Net

883

609

Goodwill - Net

11,168

6,633

Deferred Income Taxes - Net

566

566

Other Assets

744

602

Total Assets

$

115,569

$

102,098

Liabilities and Shareholders' Equity

Current Liabilities

Accounts payable

$

8,571

$

2,676

Accrued compensation and related taxes

2,427

2,066

Accrued warranty expense

485

380

Other accrued liabilities

1,825

751

Current maturities of long-term debt

392

380

Contract liabilities

1,870

1,224

Total current liabilities

15,570

7,477

Long-Term Debt

4,502

4,798

Long-Term Lease Liability

8,419

5,064

Income Taxes Payable

3,471

3,240

Other Long-Term Liabilities

67

-

Total Liabilities

32,029

20,579

Commitments and Contingencies

Shareholders' Equity

Preferred stock; 100,000,000 shares authorized; none issued

-

-

Common stock; $0.01 par value; 100,000,000 shares authorized; shares issued and outstanding: 14,252,978 and 14,063,172 at June 30, 2021 and September 30, 2020, respectively

143

141

Additional paid-in capital

125,858

124,435

Accumulated other comprehensive loss

(892

)

(646

)

Retained deficit

(41,569

)

(42,411

)

Total shareholders' equity

83,540

81,519

Total Liabilities and Shareholders' Equity

$

115,569

$

102,098

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

August 4, 2021

(Unaudited)



Condensed Consolidated Balance Sheets

(in thousands, except share data)

June 30, September 2021 30, 2020

Assets

Current Assets

Cash and cash equivalents $ 37,040 $ 45,070

Accounts receivable (less allowance for doubtfulaccounts of $138 and $159 at June 30, 2021, and 20,893 11,243 September 30, 2020, respectively)

Inventories 20,528 17,277

Income taxes receivable 1,057 1,362

Other current assets 1,894 1,617

Total current assets 81,412 76,569

Property, Plant and Equipment - Net 12,007 11,995

Right-of-Use Assets - Net 8,789 5,124

Intangible Assets - Net 883 609

Goodwill - Net 11,168 6,633

Deferred Income Taxes - Net 566 566

Other Assets 744 602

Total Assets $ 115,569 $ 102,098

Liabilities and Shareholders' Equity

Current Liabilities

Accounts payable $ 8,571 $ 2,676

Accrued compensation and related taxes 2,427 2,066

Accrued warranty expense 485 380

Other accrued liabilities 1,825 751

Current maturities of long-term debt 392 380

Contract liabilities 1,870 1,224

Total current liabilities 15,570 7,477

Long-Term Debt 4,502 4,798

Long-Term Lease Liability 8,419 5,064

Income Taxes Payable 3,471 3,240

Other Long-Term Liabilities 67 -

Total Liabilities 32,029 20,579

Commitments and Contingencies

Shareholders' Equity

Preferred stock; 100,000,000 shares authorized; - - none issued

Common stock; $0.01 par value; 100,000,000 sharesauthorized; shares issued and outstanding: 143 141 14,252,978 and 14,063,172 at June 30, 2021 andSeptember 30, 2020, respectively

Additional paid-in capital 125,858 124,435

Accumulated other comprehensive loss (892 ) (646 )

Retained deficit (41,569 ) (42,411 )

Total shareholders' equity 83,540 81,519

Total Liabilities and Shareholders' Equity $ 115,569 $ 102,098

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

August 4, 2021

(Unaudited)

Condensed Consolidated Statements of Cash Flows

(in thousands)

Nine Months Ended June 30,

2021

2020

Operating Activities

Net income (loss)

$

842

$

(13,698

)

Adjustments to reconcile net income (loss) to net cash used in operating activities:

Depreciation and amortization

1,038

932

Write-down of inventory

278

540

Deferred income taxes

-

784

Non-cash share-based compensation expense

277

257

Loss on sales of subsidiaries

-

13,708

Provision for (reversal of) allowance for doubtful accounts, net

16

(26

)

Other, net

8

13

Changes in operating assets and liabilities:

Accounts receivable

(9,385

)

2,356

Inventories

(3,328

)

(2,791

)

Other assets

(324

)

(2,376

)

Accounts payable

5,815

(2,363

)

Accrued income taxes

536

(2,722

)

Accrued and other liabilities

809

5,346

Contract liabilities

646

(950

)

Net cash used in operating activities

(2,772

)

(990

)

Investing Activities

Purchases of property, plant and equipment

(790

)

(860

)

Acquisition, net of cash and cash equivalents acquired

(5,082

)

-

Net cash disposed of in sales of subsidiaries

-

(9,940

)

Net cash used in investing activities

(5,872

)

(10,800

)

Financing Activities

Proceeds from the exercise of stock options

1,148

799

Repurchase of common stock

-

(2,000

)

Payments on long-term debt

(284

)

(285

)

Net cash provided by (used in) financing activities

864

(1,486

)

Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash

(250

)

578

Net Decrease in Cash, Cash Equivalents and Restricted Cash

(8,030

)

(12,698

)

Cash, Cash Equivalents and Restricted Cash, Beginning of Period*

45,070

59,134

Cash, Cash Equivalents and Restricted Cash, End of Period

$

37,040

$

46,436

AMTECH SYSTEMS, INC.

(NASDAQ: ASYS)

August 4, 2021

(Unaudited)



Condensed Consolidated Statements of Cash Flows

(in thousands)

Nine Months Ended June 30,

2021 2020

Operating Activities

Net income (loss) $ 842 $ (13,698 )

Adjustments to reconcile net income (loss) to net cash used in operating activities:

Depreciation and amortization 1,038 932

Write-down of inventory 278 540

Deferred income taxes - 784

Non-cash share-based compensation expense 277 257

Loss on sales of subsidiaries - 13,708

Provision for (reversal of) allowance for doubtful 16 (26 )accounts, net

Other, net 8 13

Changes in operating assets and liabilities:

Accounts receivable (9,385 ) 2,356

Inventories (3,328 ) (2,791 )

Other assets (324 ) (2,376 )

Accounts payable 5,815 (2,363 )

Accrued income taxes 536 (2,722 )

Accrued and other liabilities 809 5,346

Contract liabilities 646 (950 )

Net cash used in operating activities (2,772 ) (990 )

Investing Activities

Purchases of property, plant and equipment (790 ) (860 )

Acquisition, net of cash and cash equivalents (5,082 ) - acquired

Net cash disposed of in sales of subsidiaries - (9,940 )

Net cash used in investing activities (5,872 ) (10,800 )

Financing Activities

Proceeds from the exercise of stock options 1,148 799

Repurchase of common stock - (2,000 )

Payments on long-term debt (284 ) (285 )

Net cash provided by (used in) financing activities 864 (1,486 )

Effect of Exchange Rate Changes on Cash, Cash (250 ) 578 Equivalents and Restricted Cash

Net Decrease in Cash, Cash Equivalents and (8,030 ) (12,698 )Restricted Cash

Cash, Cash Equivalents and Restricted Cash, 45,070 59,134 Beginning of Period*

Cash, Cash Equivalents and Restricted Cash, End of $ 37,040 $ 46,436 Period

*

Includes Cash, Cash Equivalents and Restricted Cash that are included in Held-For-Sale Assets on the Condensed Consolidated Balance Sheets for periods prior to January 22, 2020.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210804005995/en/

CONTACT: Amtech Systems, Inc. Lisa D. Gibbs Chief Financial Officer (480) 360-3756 irelations@amtechsystems.com

CONTACT: Sapphire Investor Relations, LLC Erica Mannion and Mike Funari (617) 542-6180 irelations@amtechsystems.com