Cascade Microtech Reports First Quarter 2014 Results

Cascade Microtech Reports First Quarter 2014 Results 
Revenue of $33.8 Million; Gross Margin of 48.1%; Income From
Operations of $2.6 Million; GAAP EPS of $0.10 
BEAVERTON, OR -- (Marketwired) -- 04/29/14 --  Cascade Microtech,
Inc. (NASDAQ: CSCD) today reported financial results for the first
quarter March 31, 2014. 
Financial summary 
Results for the quarter ended March 31, 2014 were as follows: 


 
--  Total revenue of $33.8 million, compared to $34.0 million for Q4 2013
    and $27.5 million for Q1 2013.
    --  Systems revenue of $21.6 million, a decrease of $2.6 million, or
        10.8%, from Q4 2013, and an increase of $3.9 million, or 21.8%,
        over Q1 2013.
    --  Probes revenue of $12.2 million, an increase of $2.4 million, or
        24.3%, over Q4 2013, and an increase of $2.5 million, or 25.4%,
        over Q1 2013.
    --  Q1 2014 sets a new revenue record for our Probes segment.
--  Gross margin of 48.1%, up from 45.5% in Q4 2013, and 42.0% in Q1 2013.
    --  Systems gross margin of 42.7%, up from 42.3% in Q4 2013, and 37.9%
        in Q1 2013.
    --  Probes gross margin of 57.8%, up from 53.3% in Q4 2013, and 49.4%
        in Q1 2013.
    --  Q1 2014 represents our best gross margin performance in 9 years.
--  Income from operations of $2.6 million, an increase of $0.4 million,
    or 18.1%, over Q4 2013, and an increase of $1.6 million, or 150.0%,
    over Q1 2013.
--  Net income of $1.6 million, or $0.10 per diluted share, compared to
    $8.8 million, or $0.53 per diluted share, for Q4 2013, and $0.7
    million, or $0.05 per diluted share, for Q1 2013.
    --  Q1 2014 includes tax expense of $0.9 million, or $0.06 per diluted
        share, compared to a tax benefit of $6.6 million, or $0.40 per
        diluted share, for Q4 2013, and tax expense of $0.1 million, or
        $0.01 per diluted share, for Q1 2013.
--  Non-GAAP net income of $0.13 per diluted share, compared to $0.21 per
    diluted share for Q4 2013 and $0.07 per diluted share for Q1 2013.
--  Depreciation, amortization and stock-based compensation expenses
    totaled $2.1 million, compared to $2.1 million for Q4 2013 and $1.5
    million for Q1 2013.
--  Adjusted EBITDAS of $4.7 million, compared to $5.2 million for Q4 2013
    and $2.6 million for Q1 2013.
--  T
otal cash, restricted cash and investments of $28.5 million, an
    increase of $6.0 million over December 31, 2013.
    --  Q1 2014 includes stock repurchases of $0.8 million.
--  Book-to-bill ratio of 0.92 to 1.

  
"We are pleased by the strong overall results of the first quarter.
Both revenue and profitability were near the high end of our
expectations due to record revenue and gross margins from our Probes
segment. Favorable product mix drove the best overall gross margins
for the company in over nine years, and cash grew $6 million quarter
on quarter. Our new acquisitions performed well, and we continue to
see improved market acceptance and sales of our new products. With a
strong Q1 behind us, we are optimistic about the rest of 2014," said
Michael Burger, President and CEO.  
Financial outlook 
For the second quarter of 2014 we are projecting revenue in the range
of $32.0 million to $35.0 million with diluted GAAP earnings per
share in the range of $0.05 to $0.10, and non-GAAP earnings per share
in the range of $0.08 to $0.13. Our guidance assumes a tax rate of
37%, consistent foreign currency rates and no significant one-time
charges. 
We will host a conference call beginning at 2:00 p.m. PDT (5:00 p.m.
EDT) on Tuesday, April 29, 2014, to discuss our results for the
quarter ended March 31, 2014. 
A simultaneous audio cast of the conference call may be accessed
online from the investor relations page of www.cascademicrotech.com.
If you are interested in participating in the call, the live dial-in
number is 866-515-2910, or international 617-399-5124, participant
Passcode: 24546255. A replay will be available after 9:00 p.m. EDT at
the same internet address. (For a telephone replay available after
9:00 p.m. EDT, dial: 888-286-8010, international: 617-801-6888,
Passcode: 22751227). 
Forward-Looking Statements  
The statements in this release regarding performance of our new
acquisitions, improved market acceptance and sales of our new
products, our optimism about the rest of 2014, and statements under
"Financial Outlook" regarding projected revenue, GAAP earnings per
share, and non-GAAP earnings per share, and other statements
identified by terminology such as "will," "should," "expects,"
"estimates," "predicts," and "continue" or other derivations of these
or other comparable terms are "forward-looking" statements within the
meaning of the Securities Litigation Reform act of 1995. Such
statements are based on current expectations, estimates and
projections about the Company's business based in part on assumptions
made by management. These statements are not guarantees of future
performance and involve risks and uncertainties that are difficult to
predict. Therefore, actual outcomes and results may differ materially
from what is expressed or forecasted in such forward-looking
statements due to numerous factors, including: changes in demand for
the Company's products; changes in product mix; potential delays and
other factors affecting the timing of new product introductions; the
timing of shipments and customer orders; constraints on supplies of
components; excess or shortage of production capacity; potential
failure of expected market opportunities to materialize; changes in
foreign exchange rates; our ability or delay in integrating acquired
businesses; and other risks discussed from time to time in the
Company's Securities and Exchange Commission filings and reports,
including the Company's Annual Report on Form 10-K for the year ended
December 31, 2013. In addition, such statements could be affected by
general industry and market conditions and growth rates and general
domestic and international economic conditions. Such forward-looking
statements speak only as of the date on which they are made and the
Company does not undertake any obligation to update any
forward-looking statement to reflect events or circumstances after
the date of this release. 
Non-GAAP Financial Measures
 In addition to disclosing financial
results calculated in accordance with U.S. generally accepted
accounting principles (GAAP), the Company's earnings release contains
Non-GAAP financial measures which are defined below and reconciled to
GAAP financial measures in a table later in this release: 


 
--  Non-GAAP net income is defined as GAAP net income before certain items
    (adjustments) such as restructuring, facility move and project costs,
    acquisition-related expenses, the amortization of intangibles and
    discrete tax items that we believe are either not representative of
    our ongoing operating performance or effect the comparability of
    results over time. Non-GAAP net income should not be construed as a
    substitute for net income as defined by GAAP. However, we regard
    non-GAAP net income as a complement to GAAP net income in assessing
    our financial performance over time and in the future.
    
    
--  Adjusted EBITDAS is defined as income from continuing operations
    before depreciation and amortization and stock-based compensation and
    certain other items (adjustments) such as restructuring, facility move
    and project costs, and acquisition-related expenses that we believe
    are not representative of our ongoing operating performan
ce. Adjusted
    EBITDAS should not be construed as a substitute for net income from
    continuing operations or net cash provided by (used in) operating
    activities (all as determined in accordance with GAAP) for the purpose
    of analyzing our operating performance, financial position and cash
    flows, as adjusted EBITDAS is not defined by GAAP. However, we regard
    adjusted EBITDAS as a complement to net income from continuing
    operations and other GAAP financial performance measures, by including
    an indirect measure of operating cash flow.

  
About Cascade Microtech, Inc.  
Cascade Microtech, Inc. (NASDAQ: CSCD) is a worldwide leader in
precision contact, electrical measurement and test of integrated
circuits (ICs), optical devices and other small structures. For
technology businesses and scientific institutions that need to
evaluate small structures, Cascade Microtech delivers access to
electrical data from wafers, ICs, IC packages, circuit boards and
modules, MEMS, 3D TSV, LED devices and more. Cascade Microtech's
leading-edge stations, probes, probe cards, advanced thermal
subsystems and integrated systems deliver precision accuracy and
superior performance both in the lab and during production
manufacturing of high-speed and high-density semiconductor chips. For
more information, visit www.cascademicrotech.com. 


 
                                                                            
                                                                            
                          CASCADE MICROTECH, INC.                           
                              AND SUBSIDIARIES                              
                                                                            
              Condensed Consolidated Statements of Operations               
                   (in thousands, except per share data)                    
                                (unaudited)                                 
                                                                            
                                                                            
                                              Three Months Ended            
                                  ----------------------------------------- 
                                    March 31,     March 31,    December 31, 
                                       2014          2013          2013     
                                  ------------- ------------- ------------- 
                                                                            
Revenue                           $      33,810 $      27,471 $      34,035 
Cost of sales                            17,537        15,928        18,547 
                                  ------------- ------------- ------------- 
Gross profit                             16,273        11,543        15,488 
                                  ------------- ------------- ------------- 
                                                                            
Operating expenses:                                                         
 Research and development                 3,241         2,456         3,061 
 Selling, general and                                                       
  administrative                         10,430         8,046        10,223 
                                  ------------- ------------- ------------- 
                                         13,671        10,502        13,284 
                                  ------------- ------------- ------------- 
                                                                            
Income from operations                    2,602         1,041         2,204 
                                  ------------- ------------- ------------- 
                                                                            
Other income (expense):                                                     
 Interest income, net                         2            20             4 
 Other, net                                 (69)         (244)          (27)
                                  ------------- ------------- ------------- 
                                            (67)         (224)          (23)
                                  ------------- ------------- ------------- 
                                                                            
Income before income taxes                2,535           817         2,181 
                                                                            
Income tax expense (benefit)                943            70        (6,621)
                                  ------------- ------------- ------------- 
                                                                            
Net income                        $       1,592 $         747 $       8,802 
                                  ============= ============= ============= 
                                                                            
Net income per share:                                                       
 Basic                            $        0.10 $        0.05 $        0.54 
 Diluted                          $        0.10 $        0.05 $        0.53 
                                                                            
Shares used in computing net                                                
 income per share:                                                          
 Basic                                   16,242        14,227        16,173 
 Diluted                                 16,679        14,599        16,634 
                                                                            
                                                                            
                                                                            
                          CASCADE MICROTECH, INC.                           
                              AND SUBSIDIARIES                              
                                                                            
                   Condensed Consolidated Balance Sheets                    
                               (in thousands)                               
                                (unaudited)                                 
                                                                            
                                                                            
                                               March 31,      December 31,  
                   Assets                         2014            2013      
                                            --------------- --------------- 
                                                                            
Current assets:                                                             
  Cash and cash equivalents                 $        24,945 $        17,172 
  Marketable securities                               2,737           4,278 
  Restricted cash                                       831           1,082 
  Accounts receivable, net                           21,642          26,520 
  Inventories                                        25,598          24,884 
  Deferred income taxes                               2,270           2,268 
  Prepaid expenses and other   
                       2,616           2,147 
                                            --------------- --------------- 
    Total current assets                             80,639          78,351 
                                                                            
Fixed assets, net                                     5,805           6,403 
Purchased intangible assets, net                     16,206          16,937 
Goodwill                                             14,473          14,471 
Deferred income taxes                                 1,236           1,235 
Other assets, net                                     1,092           1,114 
                                            --------------- --------------- 
                                                                            
                                            $       119,451 $       118,511 
                                            =============== =============== 
                                                                            
                                                                            
    Liabilities and Shareholders' Equity                                    
                                                                            
Current liabilities:                                                        
  Accounts payable                          $         7,193 $         7,229 
  Deferred revenue                                    2,092           2,555 
  Accrued liabilities                                 9,158           8,859 
                                            --------------- --------------- 
    Total current liabilities                        18,443          18,643 
                                                                            
Deferred revenue                                        566             548 
Other long-term liabilities                           1,897           2,119 
                                            --------------- --------------- 
                                                                            
    Total liabilities                                20,906          21,310 
                                            --------------- --------------- 
                                                                            
Shareholders' equity:                                                       
  Common stock                                      107,808         108,070 
  Accumulated other comprehensive income                132             118 
  Accumulated deficit                                (9,395)        (10,987)
                                            --------------- --------------- 
                                                                            
    Total shareholders' equity                       98,545          97,201 
                                            --------------- --------------- 
                                                                            
                                            $       119,451 $       118,511 
                                            =============== =============== 
                                                                            
                                                                            
                                                                            
                          CASCADE MICROTECH, INC.                           
                              AND SUBSIDIARIES                              
                                                                            
           Reconciliation of GAAP to Non-GAAP Financial Measures            
                  (in thousands, except per share amounts)                  
                                (unaudited)                                 
                                                                            
                                                                            
                                           Three Months Ended               
                            ----------------------------------------------- 
                               March 31,       March 31,      December 31,  
Non-GAAP Net Income               2014            2013            2013      
                            --------------- --------------- --------------- 
GAAP net income             $         1,592 $           747 $         8,802 
                                                                            
Adjustments to net income:                                                  
  Restructuring                           -               -             115 
  Acquisition and                                                           
   acquisition related                    -               -             779 
  Amortization of                                                           
   intangibles                          785             237             787 
  Income tax effect of non-                                                 
   GAAP adjustments                    (291)            (21)           (168)
  Discrete tax items                      -               -          (6,840)
                            --------------- --------------- --------------- 
Non-GAAP net income         $         2,086 $           963 $         3,475 
                            =============== =============== =============== 
                                                                            
GAAP net income per diluted                                                 
 share                      $          0.10 $          0.05 $          0.53 
                            =============== =============== =============== 
Non-GAAP net income per                                                     
 diluted share              $          0.13 $          0.07 $          0.21 
                            =============== =============== =============== 
                                                                            
Shares used in diluted                                                      
 share calculations                  16,679          14,599          16,634 
                                                                            
                                                                            
                                    Three Months Ended June 30, 2014        
                            ----------------------------------------------- 
                                Low Range                      High Range   
                                Guidance                        Guidance    
                            ---------------                 --------------- 
Forward-looking non-GAAP                                                    
 net income                                                                 
GAAP net income             $           800                 $         1,600 
Adjustments:                                                                
  Amortization of                                                           
   intangibles                          785                             785 
  Income tax effect of non-                                                 
   GAAP adjustments                    (291)                           (291)
                            ---------------                 --------------- 
Non-GAAP Net Income         $         1,294                 $         2,094 
                            ===============                 =============== 
                                                                            
GAAP net income per diluted                                                 
 share                      $          0.05                 $          0.10 
                            ===============                 =============== 
Non-GAAP net income per                                                     
 diluted share              $    
      0.08                 $          0.13 
                            ===============                 =============== 
                                                                            
Shares used in diluted                                                      
 share calculations                  16,750                          16,750 
                                                                            
                                                                            
                                           Three Months Ended               
                            ----------------------------------------------- 
EBITDAS and Adjusted            March 31,       March 31,     December 31,  
 EBITDAS                          2014            2013            2013      
                            --------------- --------------- --------------- 
GAAP Income from operations $         2,602 $         1,041 $         2,204 
                                                                            
Adjustments:                                                                
  Depreciation                          829             963             874 
  Amortization of                                                           
   intangibles                          785             237             787 
  Stock-based compensation              449             334             399 
                            --------------- --------------- --------------- 
EBITDAS                     $         4,665 $         2,575 $         4,264 
                            --------------- --------------- --------------- 
                                                                            
Adjustments:                                                                
  Restructuring                           -               -             115 
  Acquisition and                                                           
   acquisition related                    -               -             779 
                            --------------- --------------- --------------- 
Adjusted EBITDAS            $         4,665 $         2,575 $         5,158 
                            =============== =============== =============== 

  
FOR MORE INFORMATION, CONTACT: 
Jeff A. Killian
Cascade Microtech, Inc.
(503) 601-1280 
 
 
Press spacebar to pause and continue. Press esc to stop.