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TheStreet Open House

Photronics Reports Strong Second Quarter Fiscal 2012 Results

09-2012

PLAB – E

PHOTRONICS, INC. AND SUBSIDIARIES

Reconciliation of GAAP to non-GAAP Financial Information

(in thousands)
(Unaudited)
 
  Three Months Ended   Six Months Ended
April 29,   May 1, April 29,   May 1,
2012 2011 2012 2011
 

Reconciliation of GAAP to Non-GAAP Net Income (Loss) Attributable to Photronics, Inc.

 
GAAP net income (loss) attributable to Photronics, Inc. $ 8,818 $ (16,438 ) $ 13,086 $ (4,327 )
 

(a)

Debt extinguishment loss and net interest impact, net of tax

- 30,513 - 30,513
 

(b)

Consolidation and restructuring charges, net of tax

58 - 1,176 -
 

(c)

Impact of warrants, net of tax

  -     745     (94 )   820  
 
Non-GAAP net income attributable to Photronics, Inc. $ 8,876   $ 14,820   $ 14,168   $ 27,006  
 

 

Reconciliation of GAAP to Non-GAAP Net Income (Loss) Applicable to Common Shareholders

 
Weighted average number of diluted shares outstanding
 
GAAP   76,590     55,685     76,472     54,751  
 

(d)

Non-GAAP

  76,590     67,047     76,435     66,634  
 
Net income (loss) per diluted share
 
GAAP $ 0.14   $ (0.30 ) $ 0.21   $ (0.08 )
 
Non-GAAP $ 0.14   $ 0.24   $ 0.23   $ 0.44  
 

(a)

Represents 2011 extinguishment charge related to the repurchase of $30.4 million of our 5.50% convertible senior notes due in October 2014, and net interest impact on convertible transactions.

 

(b)

Represents consolidation and restructuring charges primarily related to restructuring in Singapore.

 

(c)

Represents financing expenses related to warrants, which are recorded in other income (expense).

 

(d)

Excludes the 2011 impact of shares issued on March 29, 2011 (1.7 million shares during the three months ended May 1, 2011 and 0.8 million shares during the six months ended May 1, 2011), primarily related to the issuance of common stock in exchange for $30.4 million of our 5.5% convertible senior notes due in October 2014.

 

PHOTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)
(Unaudited)
 
  Three Months Ended   Six Months Ended
April 29,   May 1, April 29,   May 1,
2012 2011

2012

2011
 
Net sales $ 117,451 $ 133,103 $ 229,605 $ 253,926
 
Costs and expenses:
 
Cost of sales (87,590 ) (96,617 ) (174,286 ) (186,845 )
 
Selling, general and administrative (12,201 ) (11,448 ) (23,526 ) (22,162 )
 
Research and development (4,441 ) (3,940 ) (8,885 ) (7,711 )
 
Consolidation, restructuring and related charges   (58 )   -     (1,176 )   -  
 
Operating income 13,161 21,098 21,732 37,208
 
Debt extinguishment loss - (30,286 ) - (30,286 )
 
Other expense, net   (968 )   (2,585 )   (1,377 )   (1,629 )
 
Income (loss) before income taxes 12,193 (11,773 ) 20,355 5,293
 
Income tax provision   (2,663 )   (3,260 )   (5,984 )   (6,742 )
 
Net income (loss) 9,530 (15,033 ) 14,371 (1,449 )
 
Net income attributable to noncontrolling interests   (712 )   (1,405 )   (1,285 )   (2,878 )
 
Net income (loss) attributable to Photronics, Inc. $ 8,818   $ (16,438 ) $ 13,086   $ (4,327 )
 
Earnings (loss) per share:
Basic $ 0.15   $ (0.30 ) $ 0.22   $ (0.08 )
 
Diluted $ 0.14   $ (0.30 ) $ 0.21   $ (0.08 )
 

Weighted average number of common shares outstanding:

Basic   60,086     55,685     59,952     54,751  
 
Diluted   76,590     55,685     76,472     54,751  
 

PHOTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands)
(Unaudited)
 
  April 29,   October 30,
2012 2011
 

Assets

 
Current assets:
Cash and cash equivalents $ 191,960 $ 189,928
Accounts receivable 89,123 85,540
Inventories 20,453 22,100
Other current assets   8,359     7,639  
 
Total current assets 309,895 305,207
 
Property, plant and equipment, net 382,800 368,680
Investment in joint venture 85,831 79,984
Intangible assets, net 39,918 42,462
Other assets   20,803     21,521  
 
$ 839,247   $ 817,854  
 
 

 

Liabilities and Equity

 
Current liabilities:
Current portion of long-term borrowings $ 7,874 $ 5,583
Accounts payable and accrued liabilities   81,394     90,318  
 
Total current liabilities 89,268 95,901
 
Long-term borrowings 172,312 152,577
Other liabilities 8,789 9,620
 
Equity   568,878     559,756  
 
$ 839,247   $ 817,854  
 

PHOTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(in thousands)
(Unaudited)
 
  Six Months Ended
April 29,   May 1,
2012 2011
 
 
Cash flows from operating activities:
Net income (loss) $ 14,371 $ (1,449 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization 44,135 46,467
Consolidation, restructuring, and related charges 262 -
Debt extinguishment loss - 23,504
Changes in assets and liabilities and other   3,631     (4,532 )
 
Net cash provided by operating activities   62,399     63,990  
 
Cash flows from investing activities:
Purchases of property, plant and equipment (67,626 ) (39,254 )
Investment in joint venture (5,899 ) (8,498 )
Other   (1,600 )   (250 )
 
Net cash used in investing activities   (75,125 )   (48,002 )
 
Cash flows from financing activities:
Proceeds from long-term borrowings 25,000 17,000
Proceeds from issuance of convertible debt - 115,000
Repayments of long-term borrowings (2,343 ) (60,303 )
Payments of deferred financing fees (198 ) (4,145 )
Repurchase of common stock by subsidiary (7,577 ) (3,294 )
Proceeds from exercise of share-based arrangements   431     356  
 
Net cash provided by financing activities   15,313     64,614  
 
Effect of exchange rate changes on cash   (555 )   6,565  
 
Net increase in cash and cash equivalents 2,032 87,167
Cash and cash equivalents, beginning of period   189,928     98,945  
 
 
Cash and cash equivalents, end of period

$

191,960

 

$

186,112

 




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