Photronics Inc.

12/11/2024 | Press release | Distributed by Public on 12/11/2024 05:41

Photronics Reports Full Year and Fourth Quarter Fiscal 2024 Results Form 8 K

Photronics Reports Full Year and Fourth Quarter Fiscal 2024 Results

BROOKFIELD, Conn. December 11, 2024 (GLOBE NEWSWIRE) - Photronics, Inc. (NASDAQ:PLAB), a worldwide leader in photomask technologies and solutions, today reported financial results for its full year and fourth quarter of fiscal year 2024 ended October 31, 2024.
"We achieved sequential revenue growth in the fourth quarter, with increased sales in both Integrated Circuits (IC) and Flat Panel Displays (FPD)," said Frank Lee, chief executive officer. "IC growth was driven by strong high-end sales, particularly in the US, while FPD was led by mainstream demand. Photomask demand trends were favorable as we ended the year and we are cautiously optimistic that these trends will continue into 2025, driven by megatrends such as AI, supply chain regionalization, and edge computing. We believe our competitive advantages and market leadership will allow us to grow along with the photomask market growth trajectory. Combined with financial discipline to expand margins and improve cash flow, we are well positioned to continue growing profitably and creating shareholder value."
Full Year Fiscal 2024 Results

Revenue was $866.9 million, down 3% from the previous year.

GAAP net income attributable to Photronics, Inc. shareholders was $130.7 million, or $2.09 per diluted share, compared with $125.5 million, or $2.03 per diluted share in 2023.

Non-GAAP net income attributable to Photronics, Inc. shareholders was $127.6 million, or $2.05 per diluted share, compared with $126.0 million, or $2.04 per diluted share in 2023.

IC revenue was $638.1 million, down 2%.

FPD revenue was $228.8 million, down 5%.

Cash generated from operating activities was $261.4 million, and cash invested in organic growth through capital expenditures was $130.9 million.
Fourth Quarter Fiscal 2024 Results

Revenue was $222.6 million, down 2% year-over-year and up 6% sequentially.

GAAP Net income attributable to Photronics, Inc. shareholders was $33.9 million, or $0.54 per diluted share, compared with $44.6 million, or $0.72 per diluted share in the fourth quarter of 2023 and $34.4 million, or $0.55 per diluted share in the third quarter of 2024.

Non-GAAP Net income attributable to Photronics, Inc. shareholders was $37.1 million, or $0.59 per diluted share, compared with $37.2 million, or $0.60 per diluted share in the fourth quarter of 2023 and $31.9 million, or $0.51 per diluted share in the third quarter of 2024.

IC revenue was $163.7 million, down 1% year-over-year and up 5% sequentially.

FPD revenue was $58.9 million, down 7% from the same quarter last year and up 7% sequentially.

Cash generated from operating activities was $68.4 million, and cash invested in organic growth through capital expenditures was $43.2 million.

Cash and Short-term investments at the end of the quarter were $640.7 million, and Debt was $18.0 million.

First Quarter Fiscal 2025 Guidance
For the first quarter of fiscal 2025, Photronics expects Revenue to be between $208 million and $216 million and non-GAAP Net income attributable to Photronics, Inc. shareholders to be between $0.43 and $0.49 per diluted share.
Webcast
A webcast to discuss these results is scheduled for 8:30 a.m. Eastern time on December 11, 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, 2024, the company had approximately 1,878 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 our Annual Report on Form 10-K for the fiscal year ended October 31, 2023 and other subsequent filings 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. 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 and non-GAAP diluted earnings per share are "non-GAAP financial measures" as such term is defined by Regulation G of 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 a measure of consolidated operating results under U.S. GAAP and should not be considered as an alternative to Net income (loss), Net income (loss) per share, or any other measure of consolidated results under U.S. 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 statement of income and must be considered in performing a comprehensive assessment of overall financial performance. Please refer to the non-GAAP reconciliations below.
PHOTRONICS, INC.
Condensed Consolidated Statements of Income
(in thousands, except per share amounts)
(Unaudited)

Three Months Ended
Year Ended
October 31,
July 28,
October 31,
October 31,
October 31,
2024
2024
2023
2024
2023
Revenue
$
222,628
$
210,984
$
227,473
$
866,946
$
892,076
Cost of goods sold
140,326
135,846
142,591
551,000
555,914
Gross Profit
82,302
75,138
84,882
315,946
336,162
Operating Expenses:
Selling, general and administrative
21,008
19,436
16,731
77,760
69,458
Research and development
5,285
3,555
3,367
16,576
13,654
Total Operating Expenses
26,293
22,991
20,098
94,336
83,112
Other operating (loss) gain
(182
)
1
-
(92
)
-
Operating Income
55,827
52,148
64,784
221,518
253,050
Non-operating (loss) income, net
(1,034
)
10,145
18,660
25,897
16,896
Income Before Income Tax Provision
54,793
62,293
83,444
247,415
269,946
Income tax provision
14,568
14,124
20,288
63,567
70,312
Net Income
40,225
48,169
63,156
183,848
199,634
Net income attributable to noncontrolling interests
6,356
13,781
18,545
53,160
74,149
Net income attributable to Photronics, Inc. shareholders
$
33,869
$
34,388
$
44,611
$
130,688
$
125,485
Earnings per share:
Basic
$
0.55
$
0.56
$
0.73
$
2.12
$
2.05
Diluted
$
0.54
$
0.55
$
0.72
$
2.09
$
2.03
Weighted-average number of common shares outstanding:
Basic
61,863
61,815
61,290
61,726
61,139
Diluted
62,456
62,414
62,067
62,391
61,755

PHOTRONICS, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)

October 31,
October 31,
2024
2023
Assets
Current assets:
Cash and cash equivalents
$
598,485
$
499,292
Short-term investments
42,184
12,915
Accounts receivable
200,830
194,927
Inventories
56,527
49,963
Other current assets
33,036
28,353
Total current assets
931,062
785,450
Property, plant and equipment, net
745,257
709,244
Other assets
35,740
31,527
Total assets
$
1,712,059
$
1,526,221
Liabilities and Equity
Current liabilities:
Current portion of long-term debt
$
17,972
$
6,621
Accounts payable and accrued liabilities
165,839
178,602
Total current liabilities
183,811
185,223
Long-term debt
25
17,998
Other liabilities
47,464
47,391
Equity:
Photronics, Inc. shareholders' equity
1,120,864
975,008
Noncontrolling interests
359,895
300,601
Total equity
1,480,759
1,275,609
Total liabilities and equity
$
1,712,059
$
1,526,221

PHOTRONICS, INC.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)

Year Ended
October 31,
October 31,
2024
2023
Cash flows from operating activities:
Net income
$
183,848
$
199,634
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization
82,805
80,835
Share-based compensation
13,890
8,001
Changes in operating assets, liabilities and other
(19,099
)
13,706
Net cash provided by operating activities
261,444
302,176
Cash flows from investing activities:
Purchases of property, plant and equipment
(130,942
)
(131,295
)
Purchases of short-term investments
(100,558
)
(20,192
)
Proceeds from maturities of short-term investments
72,836
47,537
Government incentives
2,229
2,522
Other
(30
)
(117
)
Net cash used in investing activities
(156,465
)
(101,545
)
Cash flows from financing activities:
Repayments of debt
(6,621
)
(18,439
)
Proceeds from share-based arrangements
1,916
1,248
Net settlements of restricted stock awards
(3,025
)
(1,302
)
Net cash used in financing activities
(7,730
)
(18,493
)
Effects of exchange rate changes on cash, cash equivalents, and restricted cash
2,127
(2,680
)
Net increase in cash, cash equivalents, and restricted cash
99,376
179,458
Cash, cash equivalents, and restricted cash, beginning of period
501,867
322,409
Cash, cash equivalents, and restricted cash, end of period
$
601,243
$
501,867

PHOTRONICS, INC.
Reconciliation of GAAP Net income attributable to Photronics, Inc. shareholders to Non-GAAP Net income and
GAAP Diluted Earnings Per Share to Non-GAAP Diluted Earnings Per Share
(in thousands)
(Unaudited)

Three Months ended
Year Ended
October 31,
July 28,
October 31,
October 31,
October 31,
2024
2024
2023
2024
2023
GAAP Net Income attributable to Photronics, Inc. shareholders
$
33,869
$
34,388
$
44,611
$
130,688
$
125,485
FX (gain) loss
7,758
(4,068
)
(13,234
)
(2,168
)
(2,466
)
Estimated tax effects of FX (gain) loss
(1,936
)
914
3,437
477
317
Estimated noncontrolling interest effects of above
(2,637
)
681
2,431
(1,407
)
2,676
Non-GAAP Net income attributable to Photronics, Inc. shareholders
$
37,054
$
31,915
$
37,245
$
127,590
$
126,012
Weighted-average number of common shares outstanding - Diluted
62,456
62,414
62,067
62,391
61,755
GAAP Diluted Earnings Per Share
$
0.54
$
0.55
$
0.72
$
2.09
$
2.03
Effects of non-GAAP adjustments above
0.05
(0.04
)
(0.12
)
(0.04
)
0.01
Non-GAAP Diluted Earnings Per Share
$
0.59
$
0.51
$
0.60
$
2.05
$
2.04