Photronics Reports Third Quarter Fiscal 2022 Results

Photronics, Inc.

BROOKFIELD, Conn., Aug. 30, 2022 (GLOBE NEWSWIRE) -- Photronics, Inc. (NASDAQ:PLAB), a worldwide leader in photomask technologies and solutions, today reported financial results for its fiscal 2022 third quarter ended July 31, 2022.

“We achieved our sixth consecutive quarter of record revenue due to strong end market demand, favorable pricing dynamics, and outstanding performance by the entire organization,” said Frank Lee, chief executive officer. “Customers continue to place their trust in Photronics to support their technology roadmap by supplying the high-quality photomasks required for innovative designs that meet consumer demand. We are expanding capacity and growing volumes while controlling costs and capitalizing on operating leverage to deliver higher margins. We are also taking pricing action where appropriate to capture the full value that we are delivering to our customers. Our cash balance grew as we generated strong cash flow from operations, positioning us for continued investments in growth to expand our market-leading presence. I am proud of how the global Photronics team has responded as we look to close out another record year.”

Third Quarter 2022 Results

• Revenue was $219.9 million, up 8% sequentially and 29% compared with the same period of last year

• Net income attributable to Photronics, Inc. shareholders was $31.2 million ($0.51 per diluted share), compared with $27.4 million ($0.45 per diluted share) in the second quarter of 2022 and $17.1 million ($0.28 per diluted share) in the third quarter 2021

• Integrated circuit (IC) revenue was $161.3 million, up 11% sequentially and up 37% compared with the same period of last year

• Flat panel display (FPD) revenue was $58.7 million, flat sequentially and up 11% compared with the same period of last year

• Cash balance increased to $381 million with $93 million generated from operating activities and $12 million invested in growth through capital expenditures
  

Fourth Quarter 2022 Guidance

For the fourth quarter of 2022, Photronics expects revenue to be between $205 million and $215 million and net income attributable to Photronics, Inc. shareholders to be between $0.44 and $0.52 per diluted share.

Webcast

A webcast to discuss these results is scheduled for 8:30 a.m. Eastern time on Tuesday, August 30, 2022. The event can be accessed through the Investors page of Photronics' website (www.photronics.com) or directly at https://register.vevent.com/register/BI5f5ea35d921040438cfa995c228f1b08. The webcast will be archived on Photronics’ website.

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, 2021, the company had 1,728 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 at www.photronics.com/riskfactors. 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.

For Further Information:
John P. Jordan
Executive Vice President & CFO
203.740.5671
jjordan@photronics.com

PHOTRONICS, INC.
Condensed Consolidated Statements of Income
(in thousands, except per share amounts)
(Unaudited)
		Three Months Ended										Nine Months Ended
		July 31,				May 1,			August 1,			July 31,				August 1,
		2022				2022			2021			2022				2021
Revenue		$	219,948			$	204,509		$	170,643		$	614,283			$	482,473
Cost of goods sold			136,085				134,289			125,318			400,338				367,370
Gross Profit			83,863				70,220			45,325			213,945				115,103
Operating Expenses:
Selling, general and administrative			15,960				16,613			15,083			48,306				43,203
Research and development			4,151				4,206			5,305			14,297				14,390
Total Operating Expenses			20,111				20,819			20,388			62,603				57,593
Other operating (loss) income, net			(23	)			-			3,525			(17	)			3,525
Operating Income			63,729				49,401			28,462			151,325				61,035
Non-operating income, net			3,641				8,021			3,735			16,370				3,643
Income Before Income Tax Provision			67,370				57,422			32,197			167,695				64,678
Income tax provision			18,146				14,393			7,842			43,717				14,493
Net Income			49,224				43,029			24,355			123,978				50,185
Net income attributable to noncontrolling interests			17,994				15,597			7,279			42,252				14,547
Net income attributable to Photronics, Inc. shareholders		$	31,230			$	27,432		$	17,076		$	81,726			$	35,638
Earnings per share:
Basic		$	0.51			$	0.45		$	0.28		$	1.35			$	0.58
Diluted		$	0.51			$	0.45		$	0.28		$	1.34			$	0.57
Weighted-average number of common shares outstanding:
Basic			60,701				60,606			60,884			60,488				61,804
Diluted			61,299				61,145			61,515			61,127				62,362

PHOTRONICS, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
		July 31,			October 31,
		2022			2021
Assets
Current assets:
Cash and cash equivalents		$	380,833		$	276,670
Accounts receivable			206,495			174,447
Inventories			50,313			55,249
Other current assets			40,414			44,250
Total current assets			678,055			550,616
Property, plant and equipment, net			640,805			696,553
Other assets			30,737			47,033
Total assets		$	1,349,597		$	1,294,202
Liabilities and Equity
Current liabilities:
Current portion of long-term debt		$	10,727		$	22,248
Accounts payable and accrued liabilities			186,387			153,900
Total current liabilities			197,114			176,148
Long-term debt			46,589			89,446
Other liabilities			25,936			28,046
Photronics, Inc. shareholders' equity			850,318			823,692
Noncontrolling interests			229,640			176,870
Total equity			1,079,958			1,000,562
Total liabilities and equity		$	1,349,597		$	1,294,202

PHOTRONICS, INC.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
		Nine Months Ended
		July 31,				August 1,
		2022				2021
Cash flows from operating activities:
Net income		$	123,978			$	50,185
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization			61,210				69,305
Share-based compensation			4,623				4,034
Changes in operating assets, liabilities and other			6,110				(10,428	)
Net cash provided by operating activities			195,921				113,096
Cash flows from investing activities:
Purchases of property, plant and equipment			(46,337	)			(92,301	)
Government incentives			1,394				5,775
Other			(179	)			(170	)
Net cash used in investing activities			(45,122	)			(86,696	)
Cash flows from financing activities:
Repayments of debt			(51,917	)			(13,311	)
Purchases of treasury stock			(2,522	)			(35,750	)
Contributions from noncontrolling interest			24,995				-
Proceeds from share-based arrangements			5,505				2,251
Proceeds from long-term debt			-				20,858
Net settlements of restricted stock awards			(1,463	)			(403	)
Net cash used in financing activities			(25,402	)			(26,355	)
Effects of exchange rate changes on cash, cash equivalents, and restricted cash			(21,308	)			4,602
Net increase in cash, cash equivalents, and restricted cash			104,089				4,647
Cash, cash equivalents, and restricted cash, beginning of period			279,680				281,602
Cash, cash equivalents, and restricted cash, end of period		$	383,769			$	286,249