Form 8-K AMTECH SYSTEMS INC For: Nov 20

November 20, 2017 4:15 PM



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 20, 2017
 
Amtech Systems, Inc.
(Exact Name of Registrant as Specified in Charter)
 
Arizona
 
000-11412
 
86-0411215
(State or Other Jurisdiction
of Incorporation)
 
(Commission
File Number)
 
(IRS Employer
Identification No.)
131 S. Clark Drive, Tempe, Arizona
 
85281
(Address of Principal Executive Offices)
 
(Zip Code)
Registrant’s telephone number, including area code: (480) 967-5146
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions (see General Instruction A.2.):
 
[ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
_____________________________________________________________________________________________
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
 
[ ]
Emerging growth company
[ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.






Item 2.02    Results of Operations and Financial Condition

On November 20, 2017, Amtech Systems, Inc. (the “Registrant”) announced by press release its results of operations for the fourth quarter and year ended September 30, 2017. A copy of the press release is included as Exhibit 99.1 to this Current Report and is incorporated herein by reference.

The information contained in this Current Report, including the accompanying Exhibit 99.1 is furnished pursuant to Item 2.02 of Form 8-K and shall not be incorporated by reference into any filing of the Registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference in such filing. The information in this Current Report, including the accompanying exhibit, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.


Item 9.01    Financial Statements and Exhibits.

Exhibit No.            Description                
99.1                Press Release dated November 20, 2017







Exhibit Index    


Exhibit No.            Description                
99.1Press Release dated November 20, 2017

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
                        


 
 
 
AMTECH SYSTEMS, INC.
 
 
 
 
Date:
November 20, 2017
 
By: /s/ Robert T. Hass
 
 
 
Name: Robert T. Hass
 
 
 
Title: Executive Vice President & Chief Financial Officer










EXHIBIT 99.1

Amtech Reports Fourth Quarter and Fiscal 2017 Results
TEMPE, Ariz., November 20, 2017 /PRNewswire/ -- Amtech Systems, Inc. (NASDAQ: ASYS), a global supplier of production equipment and related supplies for the solar, semiconductor, and LED markets, today reported results for its fourth quarter and fiscal year ended September 30, 2017.
Fourth Quarter Fiscal 2017 Financial and Operational Highlights:
Net revenues of $54.7 million (solar $30.1 million)
Net income of $7.3 million
Diluted earnings per share of $0.51
Customer orders of $27.6 million (solar $9.6 million)
Quarter-end backlog of $102.4 million (solar $81.4 million)
Book to bill ratio of 0.5:1 (0.3:1 solar)
Unrestricted cash of $51.1 million
Fiscal Year 2017 Financial and Operational Highlights:
Net revenues of $164.5 million (solar $87.0 million)
Net income of $9.1 million
Diluted earnings per share of $0.68
Cash provided by operating activities of $11.8 million
Customer orders of $210.5 million (solar $126.6 million)
Book to bill ratio of 1.3:1 (1.4:1 solar)

Mr. Fokko Pentinga, Chief Executive Officer of Amtech, commented, “We are pleased to report that shipment of Phase I of the turnkey order and strong shipments of semiconductor products led to strong financial results in the fourth quarter and fiscal year 2017. All three of our businesses delivered very positive earnings in the fourth quarter. Both our solar and semiconductor business units performed well with sequential quarter-to-quarter and year-over-year improvements in both revenue and operating profit. The polishing segment also produced higher quarterly profits sequentially and year-over-year. In August, we successfully completed a round of equity financing, which enhanced our financial position as we continue to develop next-generation products and solutions, focus on operational excellence, and the long-term profitable growth of the company.”
At September 30, 2017, our total order backlog was $102.4 million (solar $81.4 million), compared to total backlog of $125.7 million (solar $98.2 million) at June 30, 2017. Backlog includes deferred revenue and customer orders that are expected to ship within the next 12 months.
Net revenue for the fourth quarter of fiscal 2017 was $54.7 million compared to $47.8 million in the preceding quarter and $42.4 million in the fourth quarter of fiscal 2016. The sequential increase is due primarily to increased shipments of our semiconductor equipment. The increase from the prior year quarter is due primarily to shipments relating to the large solar turnkey order, as well as increased shipments of our semiconductor equipment.
Gross margin in the fourth quarter of fiscal 2017 was 36%, compared to 32% in the preceding quarter and 29% in the fourth quarter of fiscal 2016. Sequentially and compared to prior year, gross margin increased primarily due to higher sales volumes, favorable product and customer mix, and the recognition of previously deferred profit.
Selling, general and administrative (SG&A) expenses in the fourth quarter of fiscal 2017 were $9.8 million compared to $10.1 million in the preceding quarter and $10.3 million in the fourth quarter of fiscal 2016. Sequentially, the SG&A decrease was due primarily to lower severance and employee-related expenses. The decrease in SG&A from prior year is due primarily to a $1.8 million provision for doubtful accounts receivable in the fourth quarter of fiscal 2016. The fourth quarter of fiscal 2017 included increased commissions and selling expenses on higher sales and higher employee related expenses.





Research, development and engineering (RD&E) expense was $1.8 million in the fourth quarter of fiscal 2017 compared to $1.4 million in the preceding quarter and $2.0 million in the fourth quarter of fiscal 2016.
Depreciation and amortization in the fourth quarter of fiscal 2017 was $0.6 million, compared to $0.6 million in the preceding quarter and $0.7 million in the fourth quarter of fiscal 2016.
Income tax expense in the fourth quarter of fiscal 2017 was $0.5 million compared to $1.0 million in the preceding quarter and $1.1 million in the fourth quarter of fiscal 2016.
Net income for the fourth quarter of fiscal 2017 was $7.3 million, or $0.51 per diluted share, compared to a net loss of $0.3 million, or $0.02 per share for the fourth quarter of fiscal 2016 and net income of $3.3 million or $0.25 per diluted share in the preceding quarter.
Unrestricted cash and cash equivalents at September 30, 2017 were $51.1 million, compared to $39.2 million at June 30, 2017.

Outlook
The company expects revenues for the quarter ending December 31, 2017 to be in the range of $60 to $70 million. Gross margin for the quarter ending December 31, 2017 is expected to be in the mid 20 percent range, with operating margin percentage in the mid-single digits, both influenced by product mix.
The solar and semiconductor equipment industries can be cyclical and inherently impacted by changes in market demand. Additionally, operating results can be impacted by the timing of orders, system shipments and the financial results of the solar and semiconductor businesses. The first quarter of fiscal 2018 ending December 31, 2017 is expected to be positively impacted by the solar business due to the shipment of all Phase II equipment of a large multi-phase turnkey order, followed by softer second quarter shipments and operating results. Depending on the timing of the order for the next phase of the turnkey project, the results for the second half of the year potentially may be in line with the first half of the year. Operating results could also be affected by the net impact of revenue deferral on shipments, and recognition of revenue based on customer acceptances, and progress on the start-up of the turnkey production lines, all of which can have a significant effect on operating results.
A substantial portion of Amtech's revenues are denominated in Euros. The revenue outlook provided in this press release is based on an assumed exchange rate between the United States Dollar and the Euro. A significant decrease in the value of the Euro in relation to the United States Dollar could cause actual revenues to be lower than anticipated.
 
Conference Call
Amtech Systems will host a conference call and webcast today at 5:00 p.m. ET to discuss fourth quarter and fiscal 2017 financial results. Those in the USA wishing to participate in the live call should dial (844) 868-9329. From Canada, dial (866) 605-3852, and internationally, dial (412) 317-6703. Request “Amtech” when connected to the operator. A replay of the call will be available one hour after the end of the conference call through November 27, 2017.  To access the replay please dial US toll free (877) 344-7529 and enter code 10114411. Internationally, dial (412) 317-0088 and use the same code.  A live and archived web cast of the conference call can be accessed in the investor relations section of Amtech's website at www.amtechsystems.com.






About Amtech Systems, Inc.
Amtech Systems, Inc. is a global supplier of advanced thermal processing equipment to the solar, semiconductor / electronics, and LED manufacturing markets. Amtech's equipment includes diffusion, ALD and PECVD systems and solder reflow systems. Amtech also supplies wafer handling automation and polishing equipment and related consumable products. The Company's wafer handling, thermal processing and consumable products currently address the diffusion, oxidation, and deposition steps used in the fabrication of solar cells, LEDs, semiconductors, MEMS, printed circuit boards, semiconductor packaging, and the polishing of newly sliced sapphire and silicon wafers. Amtech’s products are recognized under the leading brand names Tempress SystemsTM, Bruce TechnologiesTM, PR HoffmanTM, R2D AutomationTM, SoLayTec, and BTU International.

Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this press release is forward-looking in nature. All statements in this press release, or made by management of Amtech Systems, Inc. and its subsidiaries ("Amtech"), other than statements of historical fact, are hereby identified as "forward-looking statements" (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). In some cases, forward-looking statements can be identified by terminology such as "may," "will," "should," "would," "expects," "plans," "anticipates," "intends," "believes," "estimates," "predicts," "potential," "continue," or the negative of these terms or other comparable terminology or our management are intended to identify such forward-looking statements. Examples of forward-looking statements include statements regarding Amtech's future financial results, operating results, business strategies, projected costs, products under development, competitive positions, and plans and objectives of Amtech and its management for future operations. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. The Form 10-K, as amended, that Amtech filed with the Securities and Exchange Commission (the “SEC”) for the year-ended September 30, 2016, listed various important factors that could affect the company’s future operating results and financial condition and could cause actual results to differ materially from historical results and expectations based on forward-looking statements made in this document or elsewhere by Amtech or on its behalf. These factors can be found under the heading "Risk Factors" in the Form 10-K and investors should refer to them. Because it is not possible to predict or identify all such factors, any such list cannot be considered a complete set of all potential risks or uncertainties. Except as required by law, we undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events, or otherwise.


Contacts:
Amtech Systems, Inc.
Robert T. Hass
Chief Financial Officer
(480) 967-5146
irelations@Amtechsystems.com
Christensen
Investor Relations
Patty Bruner
(480) 201-6075
pbruner@christensenir.com

 







AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
November 20, 2017
(Unaudited)

Condensed Consolidated Statements of Operations
 
 
 
 
 
 
 
(in thousands, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30,
 
Years Ended September 30,
 
2017
 
2016
 
2017
 
2016
Revenues, net of returns and allowances
$
54,677

 
$
42,409

 
$
164,516

 
$
120,308

Cost of sales
35,085

 
29,933

 
112,584

 
86,245

Gross profit
19,592

 
12,476

 
51,932

 
34,063

 
 
 
 
 
 
 
 
Selling, general and administrative
9,771

 
10,259

 
35,135

 
33,967

Research, development and engineering
1,787

 
1,989

 
6,372

 
8,004

Operating income (loss)
8,034

 
228

 
10,425

 
(7,908
)
 
 
 
 
 
 
 
 
Gain on sale of other assets

 

 

 
2,576

(Loss) income from equity method investment
(216
)
 
73

 
(417
)
 
299

Interest and other expense, net
(27
)
 
18

 
(178
)
 
(417
)
Income (loss) before income taxes
7,791

 
319

 
9,830

 
(5,450
)
Income tax provision
474

 
1,060

 
1,744

 
3,100

Net income (loss)
7,317

 
(741
)
 
8,086

 
(8,550
)
 
 
 
 
 
 
 
 
Add: net loss attributable to noncontrolling interest

 
456

 
1,045

 
1,542

Net income (loss) attributable to Amtech Systems, Inc.
$
7,317

 
$
(285
)
 
$
9,131

 
$
(7,008
)
 
 
 
 
 
 
 
 
Income (Loss) Per Share:
 
 
 
 
 
 
 
Basic income (loss) per share attributable to Amtech shareholders
$
0.53

 
$
(0.02
)
 
$
0.68

 
$
(0.53
)
Weighted average shares outstanding
13,895

 
13,177

 
13,378

 
13,168

Diluted income (loss) per share attributable to Amtech shareholders
$
0.51

 
$
(0.02
)
 
$
0.68

 
$
(0.53
)
Weighted average shares outstanding
14,294

 
13,177

 
13,501

 
13,168



  





AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
November 20, 2017

Condensed Consolidated Balance Sheets
 
 
 
 
(in thousands, except share data)
 
 
 
 
 
 
September 30,
2017
 
September 30,
2016
Assets
 
 
 
 
Current Assets
 
 
 
 
Cash and cash equivalents
 
$
51,121

 
$
27,655

Restricted cash
 
24,640

 
893

Accounts receivable
 
 
 
 
Trade (less allowance for doubtful accounts of $866 and $3,730 at September 30, 2017, and September 30, 2016, respectively)
 
22,519

 
17,642

Unbilled and other
 
14,275

 
8,634

Inventories
 
30,210

 
23,223

Refundable income taxes
 

 
260

Vendor deposits
 
11,806

 
1,962

Other
 
2,542

 
2,655

Total current assets
 
157,113

 
82,924

Property, Plant and Equipment - Net
 
15,792

 
15,960

Intangible Assets - Net
 
3,495

 
4,100

Goodwill - Net
 
11,405

 
11,119

Investments
 
2,615

 
3,032

Deferred Income Taxes - Long-Term
 
200

 
200

Other Assets - Long-Term
 
1,003

 
1,095

Total Assets
 
$
191,623

 
$
118,430

Liabilities and Stockholders' Equity
 
 
 
 
Current Liabilities
 
 
 
 
Accounts payable
 
$
21,555

 
$
15,397

Accrued compensation and related taxes
 
7,592

 
5,710

Accrued warranty expense
 
1,254

 
795

Other accrued liabilities
 
2,056

 
2,164

Customer deposits
 
48,784

 
7,055

Current maturities of long-term debt
 
361

 
1,134

Deferred profit
 
4,081

 
4,709

Income taxes payable
 
286

 
1,100

Total current liabilities
 
85,969

 
38,064

Long-Term Debt
 
8,134

 
9,097

Income Taxes Payable - Long-Term
 
7,037

 
5,930

Total Liabilities
 
101,140

 
53,091

Commitments and Contingencies
 

 

Stockholders' Equity
 
 
 
 
Preferred stock; 100,000,000 shares authorized; none issued
 

 

Common stock; $0.01 par value; 100,000,000 shares authorized;
shares issued and outstanding: 14,710,591 and 13,179,355 at September 30, 2017, and September 30, 2016, respectively
 
147

 
132

Additional paid-in capital
 
125,564

 
111,631

Accumulated other comprehensive loss
 
(8,529
)
 
(8,876
)
Retained deficit
 
(26,699
)
 
(35,830
)
Total stockholders' equity
 
90,483

 
67,057

Noncontrolling interest
 

 
(1,718
)
Total equity
 
90,483

 
65,339

Total Liabilities and Stockholders' Equity
 
$
191,623

 
$
118,430






AMTECH SYSTEMS, INC.
(NASDAQ: ASYS)
November 20, 2017

Condensed Consolidated Statements of Cash Flows
 
 
 
(in thousands)
 
 
 
 
 
 
 
 
Years Ended September 30,
 
2017
 
2016
Operating Activities
 
 
 
Net income (loss)
$
8,086

 
(8,550
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
 
 
 
Depreciation and amortization
2,493

 
2,974

Write-down of inventory
420

 
84

Capitalized interest
277

 
322

Deferred income taxes
(27
)
 
2,280

Non-cash share based compensation expense
1,328

 
1,390

Loss on sale of property, plant and equipment
26

 
(60
)
Gain on sale of other assets

 
(2,576
)
Loss (income) from equity method investment
417

 
(299
)
(Reversal of) provision for allowance for doubtful accounts
(720
)
 
1,698

Changes in operating assets and liabilities:
 
 
 

Restricted cash
(22,262
)
 
(253
)
Accounts receivable
(8,655
)
 
(4,998
)
Inventories
(6,638
)
 
491

Accrued income taxes
573

 
351

Vendor deposits and other assets
(8,898
)
 
(814
)
Accounts payable
5,374

 
(224
)
Customer deposits and accrued liabilities
40,817

 
(1,355
)
Deferred profit
(822
)
 
(150
)
Net cash provided by (used in) operating activities
11,789

 
(9,689
)
Investing Activities
 
 
 
Purchases of property, plant and equipment
(1,256
)
 
(978
)
Proceeds from sale of property, plant and equipment
40

 
255

Proceeds from partial sale of subsidiary

 
7,012

Proceeds from sale of other assets

 
4,884

Net cash (used in) provided by investing activities
(1,216
)
 
11,173

Financing Activities
 
 
 
Proceeds from issuance of common stock, net
12,602

 
51

Payments on long-term debt
(674
)
 
(739
)
Borrowings on long-term debt
755

 
1,145

Excess tax benefit of stock compensation
18

 

Net cash provided by financing activities
12,701

 
457

Effect of Exchange Rate Changes on Cash
192

 
(138
)
Net Increase in Cash and Cash Equivalents
23,466

 
1,803

Cash and Cash Equivalents, Beginning of Year
27,655

 
25,852

Cash and Cash Equivalents, End of Year
$
51,121

 
27,655

 
 
 
 



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