2016 first quarter highlights
- Revenues of $190 million
- Gross margin of 45.0%
- Non-GAAP EPS of $0.53 (diluted); GAAP EPS of $0.36 (diluted)
- Term loan repayment of $26 million
2016 second quarter guidance
- Revenue range: $190 million to $198 million
- Gross margin range: 45.0% to 45.5%
ORBOTECH LTD. (NASDAQ: ORBK) (the "Company") today announced its consolidated financial results for the quarter ended March 31, 2016.
Commenting on the results, Asher Levy, Chief Executive Officer, said: "We are very pleased with our financial results for the first quarter, which mark a strong start to the year. Industry conditions have developed generally as we anticipated at the beginning of the year. In particular, the acceleration in technological changes is a clear positive driver for the Company, and our broad portfolio of high quality solutions enable our customers' production facilities to answer the challenges posed by this trend."
Revenues for the first quarter of 2016 totaled $190.4 million, up from $184.8 million in the first quarter, and $188.2 million in the fourth quarter, of 2015.
In the Company's Production Solutions for Electronics Industry segment:
- Revenues from the Company's semiconductor device ("SD") business were $72.5 million (including $62.4 million in equipment sales) in the first quarter of 2016. This compares to SD revenues of $61.4 million (including $46.6 million in equipment sales) in the first quarter of 2015.
- Revenues from the Company's printed circuit board ("PCB") business were $68.0 million (including $39.9 million in equipment sales) in the first quarter of 2016. This compares to PCB revenues of $58.0 million (including $31.3 million in equipment sales) in the first quarter of 2015.
- Revenues from the Company's flat panel display ("FPD") business were $44.7 million (including $35.6 million in equipment sales) in the first quarter of 2016. This compares to FPD revenues of $57.4 million (including $47.3 million in equipment sales) in the first quarter of 2015.
Revenues in the Company's other segments totaled $5.3 million in the first quarter of 2016, compared with $8.0 million in the first quarter of 2015.
Service revenues for the first quarter of 2016 were $49.5 million, compared with $53.4 million in the first quarter of 2015.
Gross profit and gross margin in the first quarter of 2016 were $85.6 million and 45.0%, respectively, compared with $83.1 million and 45.0%, respectively, in the first quarter of 2015.
GAAP net income for the first quarter of 2016 was $15.7 million, or $0.36 per share (diluted), up from $11.8 million, or $0.28 per share (diluted), for the first quarter of 2015.
Adjusted EBITDA (as defined below) and adjusted EBITDA margin for the first quarter of 2016 were $35.3 million and 18.5%, respectively, up from $33.8 million and 18.3%, respectively, in the first quarter of 2015.
Non-GAAP net income and non-GAAP net income margin for the first quarter of 2016 were $23.1 million and 12.2%, respectively, up from $20.8 million and 11.2%, for the first quarter of 2015.
Non-GAAP earnings per share (diluted) for the first quarter of 2016 were $0.53, up from $0.48 per share (diluted), for the first quarter of 2015.
A reconciliation of each of the Company's non-GAAP measures to the comparable GAAP measure (the "Reconciliation") is included at the end of this press release.
As of March 31, 2016, the Company had cash, cash equivalents (including restricted cash), short-term bank deposits and marketable securities of approximately $176.8 million, and debt of $214.0 million. In the first quarter of 2016, the Company generated cash of $15.7 million from operations and repaid $25.6 million of its term loan.
Second Quarter 2016 Guidance
The Company expects revenues for the second quarter of 2016 to be in the range of $190 million to $198 million, and gross margin to be in the range of 45.0% to 45.5%.
An earnings conference call for the Company's first quarter 2016 results is scheduled for today, May 4, 2016 at 9:00 a.m. EDT. The dial-in number for the conference call is 1-312-470-7384 or (US toll-free) 888-469-1283 and a replay will be available on telephone number +1-203-369-1922 or (US toll-free) 866-509-3935 until May 19, 2016. The pass code is Q1. A live webcast of the conference call can also be heard by accessing the Company's website here http://investors.orbotech.com/phoenix.zhtml?c=71865&p=irol-EventDetails&EventId=5216447. The webcast will remain available for 12 months at: http://investors.orbotech.com/phoenix.zhtml?c=71865&p=irol-audioArchives
About Orbotech Ltd.
Orbotech Ltd. (NASDAQ: ORBK) is a global innovator of enabling technologies used in the manufacture of the world's most sophisticated consumer and industrial products throughout the electronics and adjacent industries. The Company is a leading provider of yield enhancement and production solutions for electronics reading, writing and connecting, used by manufacturers of printed circuit boards, flat panel displays, advanced packaging, micro-electro-mechanical systems and other electronic components. Virtually every electronic device in the world is produced using Orbotech systems. For more information, visit http://www.orbotech.com.
Cautionary Statement Regarding Forward-Looking Statements
Except for historical information, the matters discussed in this press release are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements relate to, among other things, future prospects, developments and business strategies and involve certain risks and uncertainties. The words "anticipate," "believe," "could," "will," "plan," "expect" and "would" and similar terms and phrases, including references to assumptions, have been used in this press release to identify forward-looking statements. These forward-looking statements are made based on management's expectations and beliefs concerning future events affecting Orbotech and are subject to uncertainties and factors relating to Orbotech's operations and business environment, all of which are difficult to predict and many of which are beyond the Company's control. Many factors could cause the actual results to differ materially from those projected including, without limitation, cyclicality in the industries in which the Company operates, the Company's production capacity, timing and occurrence of product acceptance (the Company defines 'bookings' and 'backlog' as purchase arrangements with customers that are based on mutually agreed terms, which, in some cases for bookings and backlog, may still be subject to completion of written documentation and may be changed or cancelled by the customer, often without penalty), fluctuations in product mix, worldwide economic conditions generally, especially in the industries in which the Company operates, the timing and strength of product and service offerings by the Company and its competitors, changes in business or pricing strategies, changes in the prevailing political and regulatory framework in which the relevant parties operate or in economic or technological trends or conditions, including currency fluctuations, inflation and consumer confidence, on a global, regional or national basis, the level of consumer demand for sophisticated devices such as smartphones, tablets and other electronic devices as well as automobiles, the Company's global operations and its ability to comply with varying legal, regulatory, exchange, tax and customs regimes, the Company's ability to achieve strategic initiatives, including related to its acquisition strategy, the Company's debt and corporate financing activities; the final timing, outcome and impact of the criminal matter expected in mid- to-late 2016 and ongoing investigation in Korea, including any impact on existing or future business opportunities in Korea and elsewhere, any civil actions related to the Korean matter brought by third parties, including the Company's customers, which may result in monetary judgments or settlements, expenses associated with the Korean Matter, ongoing or increased hostilities in Israel and the surrounding areas, and other risks detailed in the Company's SEC reports, including the Company's Annual Report on Form 20-F for the year ended December 31, 2015 , and subsequent SEC filings. The Company assumes no obligation to update the information in this press release to reflect new information, future events or otherwise, except as required by law.