GT Advanced Technologies Inc. Announces Results for First Quarter Fiscal Year 2013 Revenue Performance in Line, Non-GAAP EPS Better Than Guidance NASHUA, N.H., May 1, 2013 (GLOBE NEWSWIRE) -- GT Advanced Technologies Inc. (Nasdaq:GTAT) today reported results for the first quarter of fiscal year 2013, which ended March 30, 2013. Revenue for the first quarter came in at $57.8 million including $38.0 million in polysilicon, $4.4 million in photovoltaic (PV), and $15.4 million in sapphire. This compares to revenue in the fourth quarter of calendar 2012 of $102.3 million and $353.9 million in the first quarter of calendar 2012. Non-GAAP gross profit for the first quarter was $14.1 million, or 24.4 percent of revenue, in line with the company's guidance. This compares to $33.1 million, or 32.4 percent of revenue in the fourth quarter of calendar 2012 and $152.3 million, or 43.0 percent of revenue for the first quarter of calendar 2012. Gross profit for the first quarter was $13.6 million, or 23.6 percent of revenue, compared to a loss of $41.2 million, or 40.2 percent of revenue, in the fourth quarter of calendar 2012 and $152.3 million, or 43.0 percent of revenue for the first quarter of calendar 2012. Non-GAAP net income was a loss of $8.9 million in the first quarter, compared to a loss of $18.1 million in the fourth quarter of calendar 2012 and $86.0 million for the first quarter of calendar 2012. Net income in the first quarter was a loss of $18.7 million, compared to a loss of $159.4 million in the fourth quarter of calendar 2012 and $79.1 million for the first quarter of calendar 2012. Non-GAAP earnings per share on a fully-diluted basis was a loss of $0.07 in the first quarter, which was better than the company's guidance.This compares to a non-GAAP EPS loss of $0.15 in the fourth quarter of calendar 2012 and earnings of $0.71 in the first quarter of calendar 2012. Earnings per share on a fully-diluted basis was a loss of $0.16 in the first quarter, compared to a loss of $1.34 for the fourth quarter of calendar 2012 and earnings of $0.65 for the first quarter of calendar 2012. Cash, Backlog, Orders At the end of the first quarter, the balance sheet had cash and cash equivalents totaling $320.2 million and total debt of $259.6 million. During the quarter, operations consumed $54 million of cash. In addition, the company used $40 million of cash to pay down part of its term loan facility. At the end of the fourth quarter of calendar 2012, the company had $418.1 million of cash and cash equivalents and $297.0 million of total debt and $350.9 million of cash and cash equivalents and $75.0 million of total debt at the end of the first quarter of calendar 2012. New orders during the first quarter were $16.6 million including $9.4 million of orders for DSS and $7.0 million for sapphire materials. During the first quarter the company decided to adjust its backlog downward by approximately $356 million reflecting the removal of ASF orders it had previously identified as at risk. While the orders have not been cancelled and the customers remain contractually obligated, the company has determined that these orders are unlikely to convert to sales in the foreseeable future and leaving them in reported backlog, in the company's view, is no longer a good indicator of the company's revenue potential. As a result, as of March 30, 2013 the company's reported backlog was $851.0 million. This included $491.1 million in the polysilicon segment, $8.3 million in the PV segment and $351.6 million in the sapphire segment. Included in the total backlog was approximately $146.2 million of deferred revenue. Management Commentary "In the face of continuing difficult conditions in our served solar and LED markets, our Q1 results came in slightly better than expected," said Tom Gutierrez, president and chief executive officer. "The actions we are taking to transform GT into a diversified, value-added equipment supplier are yielding results. We are confident that our initiatives in new markets as well as in new technologies that broaden our presence in our existing markets, will provide a path to resumed growth and cash generation in the years ahead." Business Outlook The company is reiterating the following guidance for fiscal year 2013, which ends December 31, 2013: revenue in the range of $500 to $600 million, non-GAAP gross margin in the range of 35% to 37% and non-GAAP EPS in the range of $0.25 to $0.45. In addition to the items typically excluded from non-GAAP, the company's Non-GAAP EPS and Non-GAAP gross margin guidance excludes restructuring charges, any potential DSS Purchase Order cancellation fees and any gain/loss associated with the disposition of the St. Louis facility. The company will provide additional guidance details on its webcasted conference call.See below for details. Conference Call, Webcast Tomorrow morning, Thursday, May 2, 2013, at 8:00am ET the company will host a live conference call with Tom Gutierrez, president and chief executive officer, and Richard Gaynor, chief financial officer, to discuss its first quarter FY2013 results and FY2013 outlook. The call will be webcast live and can be accessed by logging on to the "Investors" section of GT Advanced Technologies' website, http://investor.gtat.com/. A slide presentation will accompany the call. The live call can also be accessed by dialing (631) 291-4543. No password is required to access the webcast or call. A replay of the call will be available. To access the replay, please go to http://investor.gtat.com/ and select the webcast replay link on the 'Events and Presentations' page. Or, please dial (404) 537-3406. The telephone replay will be available through May 16, 2013 and requires the passcode 36046256. Investor Financial Summary Document A comprehensive summary of the company's financial performance can be found on the Investor Relations section of its website on the "Q1 FY13 Earnings Call" webcast page.To access: http://investor.gtat.com. About GT Advanced Technologies Inc. GT Advanced Technologies Inc. is a diversified technology company with innovative crystal growth equipment and solutions for the global solar, LED and electronics industries. Our products accelerate the adoption of new advanced materials that improve performance and lower the cost of manufacturing. For additional information about GT Advanced Technologies, please visit www.gtat.com. GT Advanced Technologies Inc. Condensed Consolidated Balance Sheets (in thousands, except per share data) (Unaudited) March 30, December 31, 2013 2012 Assets Current assets: Cash and cash equivalents $320,226 $418,095 Accounts receivable, net 20,389 23,829 Inventories 150,742 133,286 Deferred costs 47,937 30,248 Vendor advances 9,907 32,440 Deferred income taxes 42,420 28,226 Refundable income taxes 567 1,516 Prepaid expenses and other current assets 8,792 9,168 Total current assets 600,980 676,808 Property, plant and equipment, net 74,414 77,980 Other assets 87,198 86,920 Intangible assets, net 88,061 90,516 Deferred cost 24,352 24,423 Goodwill 48,021 48,021 Total assets $923,026 $1,004,668 Liabilities and stockholders' equity Current liabilities: Current portion of long-term debt $7,250 $7,250 Accounts payable 45,292 44,848 Accrued expenses 34,163 30,928 Contingent consideration 4,901 4,901 Customer deposits 80,499 111,777 Deferred revenue 103,333 86,098 Accrued income taxes 6,319 21,716 Total current liabilities 281,757 307,518 Long-term debt 92,313 132,313 Convertible notes 160,044 157,440 Deferred income taxes 19,812 24,459 Customer deposits 64,384 71,340 Deferred revenue 42,848 35,848 Contingent consideration 5,750 5,414 Other non-current liabilities 2,466 2,323 Accrued income taxes 26,104 25,762 Total liabilities 695,478 762,417 Commitments and contingencies Stockholders' equity: Preferred stock, 10,000 shares authorized, none issued -- -- and outstanding Common stock, $0.01 par value; 500,000 shares authorized, 119,397 and 119,293shares issued and 1,194 1,193 outstanding as of March 30, 2013 and December31, 2012, respectively Additional paid-in capital 187,541 183,565 Accumulated other comprehensiveincome (loss) 807 806 Retained earnings 38,006 56,687 Total stockholders' equity 227,548 242,251 Total liabilities and stockholders' equity $923,026 $1,004,668 GT Advanced Technologies Inc. Condensed Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) Three Months Ended March 30, December 31, March 31, 2013 2012 2012 Revenue $57,776 $102,333 $353,890 Cost of revenue 44,161 143,491 201,562 Gross profit 13,615 (41,158) 152,328 Operating expenses: Research and development 16,441 22,695 15,248 Selling and marketing 3,286 5,458 2,707 General and administrative 14,563 13,801 15,170 Contingent consideration (income) expense 336 296 527 Impairment of goodwill -- 57,037 -- Restructuring charges and asset impairments 2,858 33,441 -- Amortization of intangible assets 2,455 2,534 2,546 Total operating expenses 39,939 135,262 36,198 Income from operations (26,324) (176,420) 116,130 Other income (expense): Interest income 94 131 17 Interest expense (7,480) (5,957) (799) Other, net 190 (34) (52) Income before income taxes (33,520) (182,280) 115,296 Provision for income taxes (14,839) (22,871) 36,223 Net income ($18,681) ($159,409) $79,073 Net income per share: Basic ($0.16) ($1.34) $0.66 Diluted ($0.16) ($1.34) $0.65 Weighted-average number of shares used in per share calculations: Basic 119,348 119,109 119,407 Diluted 119,348 119,109 120,738 Reconciliation of Non-GAAP Financial Measures In accordance with the requirements of Regulation G issued by the Securities and Exchange Commission, we are presenting the most directly comparable GAAP financial measures and reconciling the non-GAAP financial metrics to the comparable GAAP measures. GT Advanced Technologies Inc. Reconciliation of GAAP to non-GAAP results (In thousands, except per share data) (Unaudited) Three Months Ended March 30, December 31, March 31, 2013 2012 2012 Non-GAAP Gross Profit and Gross Margin Revenue $57,776 $102,333 $353,890 Cost of revenue 44,161 143,491 201,562 Gross profit 13,615 (41,158) 152,328 Non-GAAP adjustments: Write-down of inventory, vendor 492 71,754 -- advances and PO cancellation fees Accelerated depreciation for early -- 2,520 -- retirement of fixed assets Non-GAAP gross profit $14,107 $33,116 $152,328 Non-GAAP gross margin 24.4% 32.4% 43.0% GT Advanced Technologies Inc. Reconciliation of GAAP to non-GAAP results (In thousands, except per share data) (Unaudited) Three Months Ended March 30, December 31, March 31, 2013 2012 2012 Non-GAAP Net Income & Earnings per Share Net income ($18,681) ($159,409) $79,073 Non-GAAP adjustments: Amortization of acquired intangible 2,455 2,534 2,546 assets Share-based compensation expense 4,423 2,084 4,171 Third party acquisition related 164 945 223 expenses Write-down of inventory, vendor 492 71,754 -- advances and PO cancellation fees Accelerated depreciation for early 1,000 2,520 -- retirement of fixed assets Impairment of goodwill -- 57,037 -- Restructuring charges and asset 2,858 33,441 -- impairments Contingent consideration (income) 336 296 527 expense Non-cash portion of interest expense 4,212 3,042 177 Income tax effect of non-GAAP (6,188) (32,354) (742) adjustments (1) Non-GAAP net income ($8,929) ($18,110) $85,975 Non-GAAP earnings per diluted share ($0.07) ($0.15) $0.71 ("Non-GAAP EPS") Diluted weighted average shares 119,348 119,109 120,738 outstanding (1) The Company utilized the with and without method to determine the income tax effect on non-GAAP adjustments. Use of Non-GAAP Financial Measures In addition to providing financial measurements based on generally accepted accounting principles in the United States of America (GAAP), GT Advanced Technologies is providing additional financial metrics that are not prepared in accordance with GAAP (non-GAAP). We believe that the inclusion of these non-GAAP financial measures helps investors to gain a meaningful understanding of our past performance and future prospects, consistent with how management measures and forecasts company performance, especially when comparing such results to previous periods or forecasts. Our management uses these non-GAAP measures, in addition to GAAP financial measures, as the basis for measuring our core operating performance and comparing our performance to prior periods and to the performance of our competitors.Management also uses these measures in its financial and operational decision-making. We define "non-GAAP gross profit" as GAAP gross profit excluding the write-down of inventory, vendor advances and PO cancellation fees, and the accelerated depreciation for early retirement of fixed assets.We consider non-GAAP gross profit to be an important indicator of our operational strength and performance of our business because it eliminates the effects of events that are not part of the Company's core operations. We define "non-GAAP net income" as GAAP net income excluding share-based compensation expense, amortization of acquired intangible assets, acquisition and acquisition related expenses, contingent consideration, write-downs of inventory, vendor advances and PO cancellation fees, goodwill impairment, restructuring and asset impairment, accelerated depreciation for early retirement of fixed assets, and the non-cash portion of interest expense.We consider non-GAAP net income to be an important indicator of our operational strength and performance of our business because it eliminates the effects of events that are not part of the Company's core operations. We define "non-GAAP earnings per share on a fully-diluted basis" as our non-GAAP net income divided by our weighted average shares outstanding on a fully-diluted basis. Forward-Looking Statements Some of the information in this press release relates to future expectations, plans and prospects for our business and industry that constitute "forward-looking statements" for the purposes of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, all statements under the caption "Business Outlook;" the company's estimates for future periods (including for twelve month period ending December 31, 2013) with respect to revenue, non-GAAP gross margin, and non-GAAP fully diluted earnings per share; there are continuing difficult conditions in our served solar and LED markets; the Company is taking actions to transform GT into a diversified, value-added equipment supplier; the Company is confident that its initiatives in new markets as well as in new technologies that broaden our presence in our existing markets, will provide a path to resumed growth and cash generation in the years ahead. These forward-looking statements are not a guarantee of performance and are subject to a number of uncertainties and other factors, many of which are outside the company's control, which could cause actual events to differ materially from those expressed or implied by the statements. These factors may include the possibility that the company is unable to recognize revenue on contracts in its order backlog. Although the company's backlog is based on signed purchase orders or other written contractual commitments in effect as of the end of our fiscal quarter ended March 30, 2013, we cannot guarantee that our bookings or order backlog will result in actual revenue in the originally anticipated period or at all, which could reduce our revenue, profitability and liquidity. Other factors that may cause actual events to differ materially from those expressed or implied by our forward-looking statements include the impact of continued decreased demand and/or excess capacity in the markets for the output of our solar and sapphire equipment, general economic conditions and the tightening credit markets having an adverse impact on demand for our products, the possibility that changes in government incentives may reduce demand for solar products, which would, in turn, reduce demand for our equipment, technological changes could render existing products or technologies obsolete, the company may be unable to protect its intellectual property rights, competition from other manufacturers may increase, exchange rate fluctuations and conditions in the credit markets and economy may reduce demand for the company's products and various other risks as outlined in GT Advanced Technologies Inc.'s filings with the Securities and Exchange Commission, including the statements under the heading "Risk Factors" in the company's transition report on Form 10-K for the nine-month period ended December 31, 2012. Statements in this press release should be evaluated in light of these important factors. The statements in this press release represent GT Advanced Technologies Inc.'s expectations and beliefs as of the date of this press release. GT Advanced Technologies Inc. anticipates that subsequent events and developments may cause these expectations and beliefs to change. GT Advanced Technologies Inc. is under no obligation to, and expressly disclaims any such obligation to, update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise. CONTACT: Media Jeff Nestel-Patt firstname.lastname@example.org 603-204-2883 Investors/Analysts Ryan Flaim Ryan.email@example.com 603-681-3869 GT Advanced Technologies logo
GT Advanced Technologies Inc. Announces Results for First Quarter Fiscal Year 2013
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