Amtech Reports Fourth Quarter and Fiscal 2019 Results

TEMPE, Ariz., Nov. 21, 2019 /PRNewswire/ -- 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 chips, electronic assemblies and light-emitting diodes (LEDs), today reported results for its fourth quarter and year ended September 30, 2019.

Fourth Quarter Fiscal 2019 Financial and Operational Highlights from Continuing Operations:

• Net revenue of $20.2 million
• Income from continuing operations, net of tax, of $1.0 million
• Income per diluted share from continuing operations of $0.07
• Customer orders of $20.3 million
• Unrestricted cash of $53.0 million

Fiscal 2019 Financial and Operational Highlights from Continuing Operations:

• Net revenue of $85.0 million
• Income from continuing operations, net of tax, of $3.1 million
• Income per diluted share from continuing operations of $0.22
• Customer orders of $76.6 million
• September 30, 2019 backlog of $17.3 million

Mr. J.S. Whang, Executive Chairman and Chief Executive Officer of Amtech, commented, "We can now report that we are in the final stages of the planned divestiture of our solar business and expect to have an announcement before 2019 year-end. Additionally, while evaluating how R2D, our French automation division, might fit into our power semi strategy, a buy-out offer was submitted by certain key members of R2D management. After careful consideration, we accepted the offer and expect to complete the sale in fiscal Q1 2020. We are confident that each of these divestitures is the right decision for Amtech and these businesses. We see this as another step completed in our plan to dedicate our focus and resources to our semiconductor and silicon carbide growth opportunities."

Mr. Whang continued, "We believe we are on a well-defined path to build our power semi business, including making key investments to develop next-generation equipment and enhance and expand our product portfolio, increasing capacity, and other select investments in our silicon carbide and semi businesses. As the market shifts from silicon to silicon carbide solutions for many next-generation applications, we expect to be ready with leading-edge technology solutions. We see indicators that the semi industry will rebound in the second half of 2020, and we will be ready to participate in the recovery and growth. We believe the future is bright and look forward to converting our investments to greater value for all Amtech stakeholders." 

GAAP Financial Results

Net revenues decreased 4% from the preceding quarter and 13% from the fourth quarter of fiscal 2018, as macroeconomic conditions and trade tensions continue to impact the semiconductor cycle. Gross margin increased in the fourth quarter of fiscal 2019, both on a sequential and year-over-year basis, primarily due to favorable product mix. Operating margin improved sequentially to 8.2%, as strong gross margin performance was partially offset by an increase in selling, general and administrative expenses, primarily due to employee-related expenses. Income from continuing operations, net of tax, for the fourth quarter of fiscal 2019 was $1.0 million dollars, or 7 cents per share. This is compared to a loss of $1.1 million dollars, or 8 cents per share, for the fourth quarter of fiscal 2018, which included a goodwill impairment charge of $2.2 million in our Automation segment, and income of $0.9 million dollars, or 6 cents per share, in the preceding quarter.

Outlook

For the quarter ending December 31, 2019, further softness is expected due to continued trade tensions and the semiconductor equipment industry downcycle. Revenues for the quarter are expected to be in the range of $16 to $18 million. Gross margin for the quarter ending December 31, 2019 is expected to be in the mid 30% range, with operating margin break-even to slightly positive. The outlook assumes continued weakness in demand given soft business conditions due to the ongoing macroeconomic uncertainties and excludes the impact of any potential restructuring actions.

The semiconductor equipment industries can be cyclical and inherently impacted by changes in market demand. Additionally, operating results can be significantly impacted, positively or negatively, by the timing of orders, system shipments, and the financial results of semiconductor manufacturers.

A portion of Amtech's results are 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 and webcast today at 8:30 a.m. ET to discuss fourth quarter and fiscal year financial results.  Those in the USA wishing to participate in the live call should dial (844) 868-9329. From Canada, dial (866) 605-3852, and internationally, dial (412) 317-6703.  Request "Amtech" when connected to the operator.  A replay of the call will be available one hour after the end of the conference call through November 28, 2019.  To access the replay please dial US toll free (877) 344-7529 and enter code 10136104.  Internationally, dial (412) 317-0088 and use the same code.  A live and archived web cast of the conference call can be accessed in the investor relations section of Amtech's website at www.amtechsystems.com.

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 chips, electronic assemblies and light-emitting diodes (LEDs). We sell these products to semiconductor and automotive component manufacturers worldwide, particularly in Asia, North America and Europe. Our strategic focus is on semiconductor growth opportunities in power electronics, 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 and 300mm silicon horizontal thermal reactor), 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, and PR Hoffman^TM.

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, the planned divestiture of our solar business, 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," "anticipate," "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, 2019, 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.

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SOURCE Amtech Systems, Inc.