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GlobeNewswire

Photronics Reports Second Quarter Fiscal 2024 Results

BROOKFIELD, Conn., May 22, 2024 (GLOBE NEWSWIRE) -- Photronics, Inc. (NASDAQ:PLAB), a worldwide leader in photomask technologies and solutions, today reported financial results for its second quarter of fiscal year 2024 ended April 28, 2024.

“Second quarter revenue and gross margin were in line with the first quarter as positive seasonality trends were offset by business headwinds primarily related to temporary soft demand following the Chinese New Year holiday and the impact from earthquakes in Taiwan beginning in early April,” said Frank Lee, chief executive officer. “Order rates, which typically pause during Lunar New Year, have recovered at a slower rate than we typically observe. In addition, the recent earthquakes in Taiwan caused a loss of production across both IC and FPD, resulting in an approximately $3 million revenue impact. Despite these challenges, we maintained gross margin as the global Photronics team performed well, serving our customers by quickly and efficiently recovering from the disruptions. We achieved good earnings and cash generation, further strengthening our balance sheet and positioning us to continue investing in profitable growth. We are building momentum for solid performance in 2024 and beyond.”

Second Quarter Fiscal 2024 Results

  • Revenue was $217.0 million, down 5% year-over-year and up 0.3% sequentially
  • GAAP net income attributable to Photronics, Inc. shareholders was $36.3 million, or $0.58 per diluted share, compared with $39.9 million, or $0.65 per diluted share in the second quarter 2023 and $26.2 million, or $0.42 per diluted share in the first quarter of 2024
  • Non-GAAP net income attributable to Photronics, Inc. shareholders was $28.7 million, or $0.46 per diluted share, compared with $32.9 million, or $0.54 per diluted share in the second quarter 2023 and $29.9 million, or $0.48 per diluted share in the first quarter of 2024
  • IC revenue was $160.9 million, down 4% year-over-year and up 2% sequentially
  • FPD revenue was $56.1 million, down 10% from the same quarter last year and 5% sequentially
  • Cash generated from operating activities was $76.5 million, and cash invested in organic growth through capital expenditures was $20.0 million
  • Cash balance at the end of the quarter was $539.2 million, with $20.7 million in short-term investments and $21.8 million in debt

Third Quarter Fiscal 2024 Guidance

For the third quarter of fiscal 2024, Photronics expects revenue to be between $221 million and $229 million and non-GAAP net income attributable to Photronics, Inc. shareholders to be between $0.53 and $0.59 per diluted share.

Webcast

A webcast to discuss these results is scheduled for 8:30 a.m. Eastern time on Wednesday, May 22, 2024. The call will be broadcast live and on-demand on the Events and Presentations link on the Photronics website. Analysts and investors who wish to participate in the Q&A portion of the call should click here. It is suggested that participants register fifteen minutes prior to the call's scheduled start time.

About Photronics

Photronics is a leading worldwide manufacturer of integrated circuit (IC) and flat panel display (FPD) photomasks. High precision quartz plates that contain microscopic images of electronic circuits, photomasks are a key element in the IC and FPD manufacturing process. Founded in 1969, Photronics has been a trusted photomask supplier for over 50 years.  As of October 31, 2023, the company had approximately 1,885 employees. The company operates 11 strategically located manufacturing facilities in Asia, Europe, and North America. Additional information on the company can be accessed at www.photronics.com.

Forward-Looking Statements

Certain statements in this press release constitute “forward-looking statements” regarding our industry, our strategic position, and our financial and operating results. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results, performance or achievements to differ materially. Please refer to the documents we file with the Securities and Exchange Commission. These documents contain and identify important factors that could cause our actual results to differ materially from those contained in these forward-looking statements. These certain factors can be found in our most recent SEC filings. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. We are under no duty to update any of the forward-looking statements after the date of this release to conform these statements to actual results.

Non-GAAP Financial Measures

Non-GAAP Net Income attributable to Photronics, Inc. shareholders, non-GAAP earnings per share, and Net Cash are "non-GAAP financial measures" as such term is defined by the Securities and Exchange Commission, and may differ from similarly named non-GAAP financial measures used by other companies. The attached financial supplement reconciles Photronics, Inc. financial results under GAAP to non-GAAP financial information. We believe these non-GAAP financial measures that exclude certain items are useful for analysts and investors to evaluate our future on-going performance because they enable a more meaningful comparison of our projected performance with our historical results. These non-GAAP metrics are not intended to represent funds available for our discretionary use and are not intended to represent, or be used as a substitute for, gross profit, operating income, net income, cash and cash equivalents, or cash flows from operations, as measured under GAAP. The items excluded from these non-GAAP metrics, but included in the calculation of their closest GAAP equivalent, are significant components of the condensed consolidated balance sheets and statement of cash flows and must be considered in performing a comprehensive assessment of overall financial performance. Please refer to the non-GAAP reconciliations on the following pages.

 
PHOTRONICS, INC.
Condensed Consolidated Statements of Income
(in thousands, except per share amounts)
(Unaudited)
     
     
 Three Months Ended Six Months Ended
 April 28, January 28, April 30, April 28, April 30,
 2024
 2024 2023
 2024
 2023
          
Revenue$217,000  $216,334  $229,306  $433,334  $440,397 
          
Cost of goods sold 137,749   137,079   140,904   274,828   275,918 
          
Gross Profit 79,251   79,255   88,402   158,506   164,479 
          
Operating Expenses:         
          
Selling, general and administrative 18,996   18,321   17,878   37,317   34,696 
          
Research and development 4,292   3,445   3,479   7,736   6,781 
          
Total Operating Expenses 23,288   21,766   21,357   45,053   41,477 
          
Other operating gain 89   -   -   89   - 
          
Operating Income 56,052   57,489   67,045   113,542   123,002 
          
Non-operating (loss) income, net 20,534   (3,747)  13,571   16,786   (854)
          
Income Before Income Tax Provision 76,586   53,742   80,616   130,328   122,148 
          
Income tax provision 20,214   14,660   21,343   34,874   33,925 
          
Net Income 56,372   39,082   59,273   95,454   88,223 
          
Net income attributable to noncontrolling interests 20,121   12,902   19,344   33,023   34,308 
          
Net income attributable to Photronics, Inc. shareholders$36,251  $26,180  $39,929  $62,431  $53,915 
          
Earnings per share:         
          
Basic$0.59  $0.43  $0.65  $1.01  $0.88 
          
Diluted$0.58  $0.42  $0.65  $1.00  $0.88 
          
Weighted-average number of common shares outstanding:         
          
Basic 61,771   61,455   61,138   61,613   61,016 
          
Diluted 62,409   62,283   61,507   62,346   61,489 
          


PHOTRONICS, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
 
    
 April 28, October 31,
 2024 2023
    
Assets   
    
Current assets:   
Cash and cash equivalents$539,160  $499,292 
Short-term investments 20,732   12,915 
Accounts receivable 197,523   194,927 
Inventories 54,257   49,963 
Other current assets 32,461   28,353 
    
Total current assets 844,133   785,450 
    
Property, plant and equipment, net 729,489   709,244 
Other assets 29,831   31,527 
    
Total assets$1,603,453  $1,526,221 
    
    
    
Liabilities and Equity   
    
Current liabilities:   
Current portion of long-term debt$19,318  $6,621 
Accounts payable and accrued liabilities 176,249   178,602 
    
Total current liabilities 195,567   185,223 
    
Long-term debt 2,456   17,998 
Other liabilities 37,401   47,391 
    
Photronics, Inc. shareholders' equity 1,034,857   975,008 
Noncontrolling interests 333,172   300,601 
Total equity 1,368,029   1,275,609 
    
Total liabilities and equity$1,603,453  $1,526,221 
    


PHOTRONICS, INC.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
    
    
 Six Months Ended
 April 28, April 30,
 2024 2023
    
Cash flows from operating activities:   
Net income$95,454  $88,223 
Adjustments to reconcile net income to net cash provided by operating activities:   
Depreciation and amortization 41,487   39,085 
Share-based compensation 6,499   3,830 
Changes in operating assets, liabilities and other (25,446)  (21,461)
    
Net cash provided by operating activities 117,994   109,677 
    
Cash flows from investing activities:   
Purchases of property, plant and equipment (63,311)  (57,728)
Purchases of available-for-sale debt securities (16,551)  (9,837)
Proceeds from maturities of available-for-sale debt securities 9,000   4,000 
Government incentives 1,419   1,393 
Other (6)  (88)
    
Net cash used in investing activities (69,449)  (62,260)
    
Cash flows from financing activities:   
Repayments of debt (2,844)  (14,720)
Proceeds from share-based arrangements 1,055   730 
Net settlements of restricted stock awards (2,938)  (1,252)
    
Net cash used in financing activities (4,727)  (15,242)
    
Effects of exchange rate changes on cash, cash equivalents, and restricted cash (3,839)  15,621 
    
Net increase in cash, cash equivalents, and restricted cash 39,979   47,796 
Cash, cash equivalents, and restricted cash, beginning of period 501,867   322,409 
    
Cash, cash equivalents, and restricted cash, end of period$541,846  $370,205 
    


PHOTRONICS, INC.
Reconciliation of GAAP to Non-GAAP Financial Information
(in thousands)
(Unaudited)
      
      
 Three Months ended
 April 28, January 28, April 30,
 2024 2024 2023
      
Reconciliation of GAAP to Non-GAAP Net Income:     
      
GAAP Net Income$36,251  $26,180  $39,929 
FX (gain) loss (14,766)  8,909   (10,718)
Estimated tax effects of above 3,743   (2,244)  2,823 
Estimated noncontrolling interest effects of above 3,489   (2,939)  901 
Non-GAAP Net Income$28,717  $29,906  $32,935 
      
Weighted-average number of common shares outstanding - Diluted 62,409   62,283   61,507 
      
Reconciliation of GAAP to Non-GAAP EPS:     
      
GAAP diluted earnings per share$0.58  $0.42  $0.65 
Effects of the above adjustments$(0.12) $0.06  $(0.11)
Non-GAAP diluted earnings per share$0.46  $0.48  $0.54 
      


PHOTRONICS, INC.
Reconciliation of GAAP to Non-GAAP Financial Information (cont.)
(in thousands)
(Unaudited)
      
      
Reconciliation of Cash and cash equivalents to Net Cash:     
 As of
 April 28, October 31, April 30,
 2024 2023 2023
      
Cash and cash equivalents$539,160  $499,292  $367,485 
      
Current portion of Long-term debt (19,318)  (6,621)  (7,017)
      
Long-term Debt (2,456)  (17,998)  (21,322)
      
Net Cash$517,386  $474,673  $339,146 
      

For Further Information:
Eric Rivera
Vice President & Interim CFO
203.740.5283
erivera@photronics.com


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