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Camtek Announces Record Results for the Second Quarter of 2018

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Camtek Announces Record Results for the Second Quarter of 2018

Record revenue of $30.5 million, 34% increase YoY; Expects continued strong growth in the second half of 2018

PR Newswire

MIGDAL HAEMEK, Israel, July 31, 2018 /PRNewswire/ -- Camtek Ltd. (NASDAQ:CAMT); (TASE: CAMT), today announced its financial results for the quarter ended June 30, 2018.

Highlights of the Second Quarter 2018

  • Revenues were a record at $30.5 million, up 34% year-over-year and ahead of the upper end of the previously-issued guidance range;
  • Revenues for the first half of 2018 are up over 30% from 2017;
  • GAAP operating income was $4.7 million and non-GAAP operating income was $5.0 million, representing a margins of 15.5% and 16.3%, respectively; and
  • GAAP net income was $4.3 million and non-GAAP net income was $4.6 million; representing margins of 14.2% and 15.0%, respectively.

Forward Looking Guidance

Third quarter 2018 revenues are expected to grow to $31-32 million, representing a year-over-year increase of approximately 30% for the third quarter and for the first nine months of 2018.

Management Comment

Rafi Amit Camtek's CEO commented, "2018 continues to be a very strong year with revenue growth of approximately 30% and corresponding improvement in profitability. Our strong results are due to our focus on the fastest growing segments of the semiconductors market, particularly advanced packaging. Furthermore, we are successfully leveraging our strong market position in metrology to grow and capture market share in 2D inspection applications as well. Our backlog at record levels and our improved visibility into the end of the year, give us confidence that we will continue revenue growth and associated improvement in margins and profit in the fourth quarter of 2018."

The financial results and the comparison to 2017 in this press release include only those of the continuing operations.

Second Quarter 2018 Financial Results

Revenues for the second quarter of 2018 were $30.5 million. This compares to second quarter 2017 revenues of $22.7 million, a growth of 34%.

Gross profit on a GAAP basis in the quarter totaled $14.9 million (48.9% of revenues), compared to a gross profit of $11.2 million (49.2% of revenues) in the second quarter 2017.

Gross profit on a non-GAAP basis in the quarter totaled $14.9 million (49.0% of revenues), compared to $11.2 million (49.2% of revenues) in the second quarter 2017.

Operating profit on a GAAP basis in the quarter totaled $4.7 million (15.5% of revenues), compared to an operating loss of $11.0 million in the second quarter 2017. The 2017 operating loss was due to a $13 million settlement payment for IP litigation.

Operating profit on a non-GAAP basis in the quarter totaled $5.0 million (16.3% of revenues), compared to $2.1 million (9.2% of revenues) in the second quarter 2017.

Net income on a GAAP basis in the quarter totaled $4.3 million, or $0.12 per diluted share, compared to net loss from continuing operations of $5.7 million, or ($0.16) per diluted share, in the second quarter 2017.

Net income on a non-GAAP basis in the quarter totaled $4.6 million, or $0.13 per diluted share, compared to non-GAAP net income from continuing operations of $2.0 million, or $0.06 per diluted share, in the second quarter 2017.

Cash and cash equivalents, as of June 30, 2018, were $41.2 million compared to $47.2 million as of March 31, 2018. During the quarter the Company paid a $5.1 million dividend. In addition, the Company reported a negative operating cash flow of $1.0 million during the second quarter to support the working capital requirements.

Conference Call

Camtek will host a conference call today, July 31, 2018, at 10:00 am ET.

Rafi Amit, CEO, Moshe Eisenberg, CFO and Ramy Langer, COO will host the call and will be available to answer questions after presenting the results. To participate, please call one of the following telephone numbers a few minutes before the start of the call.

US:                                          

1-888-668-9141         

at 10:00 am Eastern Time

Israel:

03-918-0609 

at 5:00 pm Israel Time

International:     

+972-3-918-0609

at 5:00 pm Israel Time

For those unable to participate, the teleconference will be available for replay on Camtek's website at http://www.camtek.com beginning 24 hours after the call.

ABOUT CAMTEK LTD.

Camtek is a leading manufacturer of metrology and inspection equipment and a provider of software solutions serving the Advanced Packaging, Memory, CMOS Image Sensors, MEMS, RF and other segments in the mid end of the semiconductor industry.

Camtek provides dedicated solutions and crucial yield-enhancement data, enabling manufacturers to improve yield and drive down their production costs.

With eight offices around the world, Camtek has best-in-class sales and customer support organization, providing tailor-made solutions in line with customers' requirements.

This press release is available at http://www.camtek.com

This press release may contain projections or other forward-looking statements regarding future events or the future performance of the Company. These statements are only predictions and may change as time passes. We do not assume any obligation to update that information. Actual events or results may differ materially from those projected, including as a result of changing industry and market trends, reduced demand for our products, the timely development of our new products and their adoption by the market, increased competition in the industry, price reductions as well as due to risks identified in the documents filed by the Company with the SEC.

This press release provides financial measures that exclude: (i) settlement expenses; (ii) changes in valuation allowance on deferred tax assets; (iii) share based compensation expenses, (iv) discontinued operations, and (v) write off costs with regard to the FIT activities, and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these Non-GAAP financial measures provide meaningful supplemental information regarding our performance. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management uses both GAAP and non-GAAP measures when evaluating the business internally and therefore felt it is important to make these non-GAAP adjustments available to investors. A reconciliation between the GAAP and non-GAAP results appears in the tables at the end of this press release.

Consolidated Balance Sheets

(In thousands)


June 30,

December 31,


2018

2017


U.S. Dollars (In thousands)

Assets








Current assets




Cash and cash equivalents

41,204


43,744

Trade accounts receivable, net

32,278


23,153

Inventories

23,693


21,336

Other current assets

2,769


3,215

Total current assets

99,944


91,448

Fixed assets, net

15,731


15,503





Long-term inventory

1,466


1,383

Deferred tax asset

3,308


4,067

Other assets, net

153


153

Intangible assets, net

480


482


5,407


6,085

Total assets

121,082


113,036





Liabilities and shareholders' equity








Current liabilities




Trade accounts payable

15,174


10,502

Other current liabilities

16,552


17,395





Total current liabilities

31,726


27,897

Long term liabilities




Liability for employee severance benefits

870


838


870


838

Total liabilities

32,596


28,735





Shareholders' equity




Ordinary shares NIS 0.01 par value, 100,000,000 shares authorized at June 30,

2018 and at December 31, 2017;




38,277,165 issued shares at June 30, 2018 and 37,924,507 at December 31,

2017;




36,184,789 shares outstanding at June 30, 2018 and 35,832,131 at December

 31, 2017

149


149

Additional paid-in capital

79,820


78,437

Retained earnings (losses)

10,415


7,613


90,384


86,199





Treasury stock, at cost (2,092,376  as of June 30, 2018 and December 31, 2017)

(1,898)


(1,898)





Total shareholders' equity

88,486


84,301





Total liabilities and shareholders' equity

121,082


113,036

 

 

Consolidated Statements of Operations

(in thousands, except share data)


Six Months ended

 June 30,

Three Months

ended June 30,

Year ended

December 31,


2018

2017

2018

2017

2017


U.S. dollars

U.S. dollars

U.S. dollars

Revenues

57,736


43,828


30,462


22,682


93,485

Cost of revenues

29,840


22,384


15,563


11,527


47,966











Gross profit

27,896


21,444


14,899


11,155


45,519











Research and development costs

6,955


6,852


3,406


3,413


13,534

Selling, general and administrative expenses

12,664


11,159


6,775


5,754


22,022

Patent litigation expense

-


13,000


-


13,000


13,000











Total operating expenses

19,619


31,011


10,181


22,167


48,556











Operating income (loss)

8,277


(9,567)


4,718


(11,012)


(3,037)











Financial income (expenses), net

436


(209)


146


(56)


(150)











Income (loss) from continuing operations










 before income taxes

8,713


(9,776)


4,864


(11,068)


(3,187)











Income tax benefit (expense)

(848)


5,364


(533)


5,404


4,875











Income (loss) from continuing operations

7,865


(4,412)


4,331


(5,664)


1,688











Discontinued operation










Income from discontinued operation










Income before tax benefit (expense)

-


4,339


-


1,981


18,302

Income tax benefit (expense)

-


(505)


-


(194)


(6,028)











Income from discontinued operation

-


3,834


-


1,787


12,274











Net income (loss)

7,865


(578)


4,331


(3,877)


13,962











Net income (loss) per ordinary share:




















Basic earnings (loss) from continuing

operation

0.22


(0.12)


0.12


(0.16)


0.05











Basic earnings from discontinued operation

-


0.11


-


0.05


0.35











Diluted earnings (loss) from continuing

operation

0.22


(0.12)


0.12


(0.16)


0.05











 Diluted earnings from discontinued

operation

-


0.11


-


0.05


0.34











Weighted average number of










 ordinary shares outstanding:




















Basic

36,050


35,359


36,090


35,369


35,441











Diluted

36,512


35,359


36,632


35,369


35,964

 

 

Camtek Ltd.

Reconciliation of GAAP To Non-GAAP results

(In thousands, except share data)


Six Months ended 

June 30,

Three Months ended

June 30,

Year ended

December 31,


2018

2017

2018

2017

2017


U.S. dollars

U.S. dollars

U.S. dollars

Reported net income (loss) attributable to

Camtek Ltd. on GAAP basis

7,865


(578)


4,331


(3,877)


13,962

Effect of FIT reorganization (1)

506


-


-


-


-

Share-based compensation

395


184


249


92


426

Settlement expense, net of tax (2)

-


12,025


-


12,025


12,025

Realization of deferred tax assets (3)

-


(4,495)


-


(4,495)


(4,495)

Attributable to discontinued operations

-


(3,832)


-


(1,787)


(12,274)











Non-GAAP net income

8,766


3,304


4,580


1,958


9,644











Non –GAAP net income  per share , basic and diluted

0.24


0.09


0.13


0.06


0.27

Gross margin on GAAP basis from continuing operations

48.4%


48.9%


48.9%


49.2%


48.7%

Reported gross profit on GAAP basis

27,896


21,444


14,899


11,155


45,519

Effect of FIT reorganization (1)

205


-


-


-


-

Share-based compensation

44


19


28


9


44











Non- GAAP gross margin

28,145


21,463


14,927


11,164


45,563

Non-GAAP gross profit

48.8%


48.9%


49.0%


49.2%


48.7%











Reported operating income (loss) attributable to Camtek Ltd.

on GAAP basis from continuing operations

8,277


(9,567)


4,718


(11,012)


(3,037)

Effect of FIT reorganization (1)

506


-


-


-


-

Share-based compensation

395


184


249


92


426

Settlement expense (2)

-


13,000


-


13,000


13,000

Non-GAAP operating income

9,178


3,617


4,967


2,080


10,389

 

(1) At the end of the first quarter of 2018, the Company ceased its efforts to utilize the remaining inventory and equipment related to FIT development and recorded a one-time write-off in the amount of $0.5 million, consisting of: (1) inventory write-offs of $0.2 million, recorded under the cost of revenue line item; and (2) fixed asset write-offs of $0.3 million recorded under operating expenses.

(2) During the three and the six months ended June 30, 2017, and the year ended December 31, 2017, the Company recorded a provision of $13 million ($12 million net of tax) in conjunction settlement with Rudolph Technologies Inc.

(3) During the three and the six months ended June 30, 2017, and the year ended December 31. 2017, the Company recorded net income of $4.5 million as a result of a decrease in the valuation allowance on deferred tax assets following the evaluation of the realizability of the assets based on projected future earnings.

Camtek Ltd.
P.O. Box 544, Ramat Gabriel Industrial Park
Migdal Ha'Emek 23150, ISRAEL
Tel: +972-(4)-604-8100
Fax: +972-(4)-644-0523
E-mail: info@camtek.com
Web site: http://www.camtek.com

Contacts:

CAMTEK LTD. 
Moshe Eisenberg, CFO
Tel: +972-4-604-8308
Mobile: +972-54-900-7100
moshee@camtek.com 

INTERNATIONAL INVESTOR RELATIONS
GK Investor Relations
Ehud Helft / Gavriel Frohwein
Tel: (US) +1-646-688-3559
camtek@gkir.com

 

 

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SOURCE Camtek Ltd.

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