Camtek Announces First Quarter 2014 Results

Second 3D Functional Inkjet Technology System started testing at a customer site; First System on track

PR Newswire

MIGDAL HAEMEK, Israel, May 1, 2014 /PRNewswire/ -- Camtek Ltd. (NASDAQ and TASE: CAMT), today announced its financial results for the quarter ended March 31, 2014.

Highlights of the First Quarter 2014

  • Revenues of $22.1 million;
  • Improved gross margins of 45.9% (non-GAAP); 45.8% on a GAAP basis;
  • Non-GAAP and GAAP operating income of $1.2 million or 5.5% and 5.3% of revenues, respectively;
  • Non-GAAP net income of $0.9 million; GAAP net income of $0.6 million;
  • Positive cash flow from operating activities of $1.3 million;
  • Second quarter revenue guidance of $22-24 million

Rafi Amit, Camtek's Chairman and CEO, commented, "We are pleased with the results of the quarter. Revenues were in line with our expectations and we have shown improvement in gross margins and profitability across the board. This improvement is a result of our ongoing efforts towards efficient operations as well as our recent decision to focus our resources on segments we believe have better growth potential."

Continued Mr. Amit, "The first customer-site test of our 3D Functional InkJet Technology product, which we have named the Gryphon product line, is ongoing and we are happy to report that the results have so far met our expectations. We are also pleased to announce the launch of a second customer-site test at our sister company, PCB Technologies. We believe we remain on track for commercial installations to begin in the latter half of the year."

Concluded Mr. Amit, "So far this year is looking promising and we have expectations of double digit growth in our semiconductor inspection and metrology business. For the second quarter, we believe revenues will be between $22-24 million."

First Quarter 2014 Financial Results

Revenues for the first quarter of 2014 were $22.1 million. This is a 22% improvement compared to revenues of $18.1 million in the first quarter of 2013. The revenue guidance range for the quarter was $21-23 million for the quarter.

Gross profit on a GAAP basis in the quarter totaled $10.1 million (45.8% of revenues), a 23.5% improvement compared to $8.2 million (45.4% of revenues) in the first quarter of 2013.

Gross profit on a non-GAAP basis in the quarter was $10.1 million (45.9% of revenues), a 22.5% improvement compared to $8.3 million (45.8% of revenues) in the first quarter of 2013.

Operating income on a GAAP basis in the quarter was $1.2 million (5.3% of revenues), compared with an operating loss of $0.2 million in the first quarter of 2013.

Operating income on a non-GAAP basis in the quarter was $1.2 million (5.5% of revenues) compared with operating income of $0.1 million in the first quarter of 2013.

Net income on a GAAP basis in the quarter totaled $0.6 million (2.9% of revenues) or $0.02 per share, compared to a net loss of $0.9 million or $0.03 per share in the first quarter of 2013.

Net income on a non-GAAP basis in the quarter was $0.9 million (4.0% of revenues) or $0.03 per share, compared to a net loss of $0.2 million or $0.01 per share in the first quarter of 2013.

Cash, cash equivalents and short-term deposits as of March 31, 2014 were $23.5 million compared to $22.5 million as of December 31, 2013. The company generated $1.3 million in positive cash flow from operating activities during the first quarter of 2014.

Conference Call

Camtek will host a conference call today, May 1, 2014, at 9:00 am ET.

Rafi Amit, Chairman and CEO, and Moshe Eisenberg, Chief Financial Officer, 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 9:00 am Eastern Time

Israel:

03 918 0609

at 4:00 pm Israel Time

International:

+972 3 918 0609


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

ABOUT CAMTEK LTD.

Camtek Ltd. provides automated and technologically advanced solutions dedicated to enhancing production processes, increasing products yield and reliability, enabling and supporting customer's latest technologies in the Semiconductors, Printed Circuit Boards (PCB) and IC Substrates industries.

Camtek addresses the specific needs of these interconnected industries with dedicated solutions based on a wide and advanced platform of technologies including intelligent imaging, image processing and functional 3D inkjet printing.

This press release is available at www.camtek.co.il.

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, intellectual property litigation, price reductions as well as due to risks identified in the documents filed by the Company with the SEC.

Use of non-GAAP Measures

This press release provides financial measures that exclude certain items such as: (i) amortization of acquired intangible assets and revaluation of liabilities with respect to the acquisitions of Sela and Printar; and (ii) share based compensation expenses, 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.

 

Camtek Ltd.

Consolidated Balance Sheets

(In thousands)


March
31

December
31,


2014

2013


U.S. Dollars (In thousands)

Assets






Current assets



Cash and cash equivalents

12,496

16,495

Short-term deposits

11,000

6,000

Trade accounts receivable, net

25,183

27,048

Inventories

17,445

17,911

Due from affiliated companies

172

233

Other current assets

2,410

1,913

Deferred tax asset

888

938




Total current assets

69,594

70,538







Fixed assets, net

14,086

14,481




Long term inventory

2,606

2,225

Long-term deposit

729

729

Deferred tax asset

975

975

Other assets, net

339

339

Intangible assets, net

1,024

1,008

Goodwill

1,555

1,555





7,228

6,831




Total assets

90,908

91,850




Liabilities and shareholders' equity






Current liabilities



Trade accounts payable

7,932

7,753

Other current liabilities

15,271

15,585




Total current liabilities

23,203

23,338




Long term liabilities



Liability for employee severance benefits

876

858

Other long term liabilities

4,086

5,758


4,962

6,616




Total liabilities

28,165

29,954




Commitments and contingencies






Shareholders' equity



Ordinary shares NIS 0.01 par value, authorized 100,000,000 shares,



32,552,327 issued as of March 31, 2014 and 32,497,902 issued as of
     December 31, 2013, outstanding 30,459,951



as of March 31, 2014 and 29,896,933 as of December 31, 2013

134

134

Additional paid-in capital

63,174

62,966

Retained earnings

1,333

694


64,641

63,794

Treasury stock, at cost (2,092,376  as of March 31, 2014 and December
  31, 2013)

(1,898)

(1,898)




Total shareholders' equity

62,743

61,896




Total liabilities and shareholders' equity

90,908

91,850






 


Camtek Ltd.

Consolidated Statements of Operations

(in thousands, except share data)


Three months ended
March 31,

Year ended
December 31,


2014

2013

2013


U.S. dollars






Revenues

22,109

18,073

85,405

Cost of revenues

11,979

9,870

51,003





Gross profit

10,130

8,203

34,402









Research and development costs

3,434

3,650

14,370

Selling, general and administrative expenses

5,526

4,706

22,362

Reorganization and impairment

-

-

(3,466)





Total operating expenses

8,960

8,356

33,266





Operating income (loss)

1,170

(153)

1,136





Financial expenses, net

(365)

(566)

(1,738)





Income (loss) before income taxes

805

(719)

(602)





Income tax

(166)

(147)

609





Net income (loss)

639

(866)

7





Earnings (loss) per ordinary share:








Basic

0.02

(0.03)

0.00





Diluted

0.02

(0.03)

0.00





Weighted average number of ordinary




 shares outstanding:








Basic

30,427

29,897

30,040





Diluted

30,534

29,897

30,094

 


Camtek Ltd.

Reconciliation of GAAP to Non-GAAP results

(In thousands, except share data)


Three months ended March 31,

Year ended December 31,


2014

2013

2013


U.S. dollars

U.S. dollars





Reported net income (loss) attributable to
   Camtek Ltd. on GAAP basis

639

(866)

7

Acquisition of Sela and Printar related expenses (1)

206

478

(1,949)

Inventory and fixed asset write-downs (2)

-

-

4,433

Share-based compensation

39

144

377

Realization of deferred tax assets (3)

-

-

(1,287)

Employee related charges (4)

-

-

490

Non-GAAP net income (loss)

884

(244)

2,071





Non –GAAP net income (loss) per share, basic and diluted

0.03

(0.01)

0.07

Gross margin on GAAP basis

Reported gross profit on GAAP basis

45.8%

10,130

45.4%

8,203

40.3%

34,402

Acquisition of Sela and Printar related expenses (1)

-

75

225

Inventory and fixed asset write-downs (2)

-

-

3,915

Share-based compensation

16

7

55

Employee related charges (4)

-

-

25

Non- GAAP gross margin

45.9%

45.8%

45.2%

Non-GAAP gross profit

10,146

8,285

38,622





Reported operating loss

attributable to Camtek Ltd. on GAAP basis

 

1,170

 

(153)

 

1,136

Acquisition of Sela and Printar related expenses (1)

-

75

(3,241)

Inventory and fixed asset write-downs (2)

-

-

4,433

Share-based compensation

39

144

377

Employee related charges

-

-

490

Non-GAAP operating income

1,209

66

3,195

 

(1)     During the three months ended March 31, 2013 and 2012 and the twelve months ended December 31, 2013, the Company recorded acquisition expenses of $0.2 million, $0.5 million, and $(2.0) million, respectively, consisting of: (1) Revaluation adjustments of $0.2 million, $0.4 million, and $1.3 million, respectively, of contingent consideration and certain future liabilities recorded at fair value. These amounts are recorded under finance expenses line item; (2) Implication of re-organization and impairment charges of $0, $0, and $(3.5) respectively; and (3) $0, $0.08 million, and $0.2 million, respectively, with respect to amortization of intangible assets acquired recorded under cost of revenues line item.

(2)     During the three months ended March 31, 2013 and 2012 and the twelve months ended December 31, 2013, the Company recorded inventory and fixed asset write downs in the amount of $0 million, $0 million and $4.4 million, respectively, consisting of $0, $0, and $3.9 million of inventory and fixed assets recorded under cogs of revenues line item and $0, $0, $0 and $0.5 of fixed assets in operating expenses.

(3)     During the three months ended March 31, 2013 and 2012 and the twelve months ended December 31, 2013, the Company recorded net income of $0, $0, and $1.3 million, respectively, 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.

(4)     During the three months ended March 31, 2013 and 2012 and the twelve months ended December 31, 2013, the Company recorded net employee related expenses of $0, $0 and $0.5 million, respectively, as a result of internal reorganization.

CAMTEK LTD.

Moshe Eisenberg, CFO

Tel: +972 4 604 8308

Mobile: +972 54 900 7100

moshee@camtek.co.il

INTERNATIONAL INVESTOR RELATIONS

GK Investor Relations

Ehud Helft / Gavriel Frohwein
Tel: (US) 1 646 688 3559

camtek@gkir.com

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