ACM Research Reports Fourth Quarter and Fiscal Year 2018 Results
March 06 2019 - 5:00PM
ACM Research, Inc. (“ACM” or the “Company”) (NASDAQ:ACMR), a
provider of single-wafer wet cleaning equipment used by
manufacturers of advanced semiconductors, today reported financial
results for its fourth quarter and fiscal year ended December 31,
2018.
ACM’s President and Chief Executive Officer Dr. David Wang
commented, “Our strong financial performance in 2018 was a result
of robust customer demand and crisp execution. We delivered
104% revenue growth, expanded operating margins, and generated $6.9
million in cash flow from operations. In addition to strong
financial results, we made significant operating progress in
2018. We ramped production at our second factory, delivered a
significant number of first tools, and introduced our newest major
platform, the Ultra-C Tahoe.”
Dr. Wang continued, “As we head into 2019, we continue to see
solid business momentum. We are committed to achieving our
vision of becoming a major player in the semiconductor equipment
market, and we look forward to delivering another strong year in
2019.”
Operating Highlights
- Shipments. Total shipments in 2018 were
approximately $95 million, versus $40 million in 2017. Total
shipments in the fourth quarter of 2018 were approximately $32
million, versus $13 million in the fourth quarter of 2017, and $32
million in the third quarter of 2018. Total shipments include
deliveries for revenue in the quarter, and deliveries of systems
awaiting customer acceptance for potential revenue in future
quarters.
- New Production Facility Ramping. More
than 40% of fourth quarter output was produced at ACM’s second
factory. The second factory adds 50,000 square feet of available
floor space to complement the 36,000 square feet at ACM’s initial
facility.
- Ultra-C Tahoe. ACM delivered its first
Ultra-C Tahoe evaluation tool in January of 2019. The Ultra-C
Tahoe tool incorporates innovative and patented technology to
deliver high cleaning performance, but uses 10% or less of the
sulfuric acid typically consumed by conventional high temperature
single wafer cleaning tools.
|
Financial Summary |
|
Three Months Ended December
31, |
|
GAAP |
|
Non-GAAP(1) |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
20,848 |
|
|
$ |
17,192 |
|
|
$ |
20,848 |
|
|
$ |
17,192 |
|
Gross
margin(2) |
|
49.5 |
% |
|
|
53.4 |
% |
|
|
49.6 |
% |
|
|
53.4 |
% |
Income
from operations(2) |
$ |
2,640 |
|
|
$ |
3,765 |
|
|
$ |
3,232 |
|
|
$ |
3,696 |
|
Net
income attributable to ACM Research, Inc.(2) |
$ |
2,286 |
|
|
$ |
3,384 |
|
|
$ |
2,878 |
|
|
$ |
3,315 |
|
Basic
EPS(2) |
$ |
0.14 |
|
|
$ |
0.28 |
|
|
$ |
0.18 |
|
|
$ |
0.28 |
|
Diluted
EPS(2) |
$ |
0.13 |
|
|
$ |
0.25 |
|
|
$ |
0.16 |
|
|
$ |
0.24 |
|
|
Twelve Months Ended December
31, |
|
GAAP |
|
Non-GAAP(1) |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
74,643 |
|
|
$ |
36,506 |
|
|
$ |
74,643 |
|
|
$ |
36,506 |
|
Gross
margin(2) |
|
46.2 |
% |
|
|
47.2 |
% |
|
|
46.2 |
% |
|
|
47.2 |
% |
Income from operations(2) |
$ |
6,471 |
|
|
$ |
700 |
|
|
$ |
9,834 |
|
|
$ |
2,323 |
|
Net
income (loss) attributable to ACM Research, Inc.(2) |
$ |
6,574 |
|
|
$ |
(318 |
) |
|
$ |
9,937 |
|
|
$ |
1,305 |
|
Basic
EPS(2) |
$ |
0.42 |
|
|
$ |
(0.05 |
) |
|
$ |
0.63 |
|
|
$ |
0.19 |
|
Diluted
EPS(2) |
$ |
0.37 |
|
|
$ |
(0.05 |
) |
|
$ |
0.55 |
|
|
$ |
0.15 |
|
________________________ (1) Reconciliations to U.S.
generally accepted accounting principles (“GAAP”) financial
measures from non-GAAP financial measures are presented below under
“Reconciliation of GAAP to Non-GAAP Financial
Measures.”(2) Non-GAAP financial measures exclude
stock-based compensation.
- Revenue. Revenue for 2018 was $74.6 million,
up 104% from 2017, due primarily to an increase in revenue from
single-wafer wet cleaning tools. Revenue for the fourth
quarter of 2018 was $20.8 million, up 21% from the fourth quarter
of 2017, due to an increased volume of tools shipped for revenue,
and higher prices associated with these tools.
- Gross margin. Gross margin for 2018 was
46.2%, versus 47.2% in 2017. Gross margin for the fourth
quarter of 2018 was 49.5%, versus 53.4% in 2017. Gross margin
was above the range of 40.0% to 45.0% set forth in the Company’s
long-term business model. The Company expects gross margin to
vary from period to period due to a variety of factors, such as
sales volume and product mix.
- Operating expenses. Operating expenses
for fiscal year 2018 were $28.0 million, compared to $16.5 million
in fiscal 2017. The increase in operating expenses for 2018
was due to higher R&D spending, sales and marketing expenses,
and general and administrative expenses. Operating expenses
in the fourth quarter of 2018 were $7.7 million, up from $5.4
million in the fourth quarter of 2017. The increase in
operating expenses in the fourth quarter of 2018, versus the fourth
quarter of 2017 was due primarily to higher R&D spending.
- Net income
attributable to ACM Research, Inc. Net
income for the fiscal year 2018 was $6.6 million, compared to net
loss of $0.3 million in fiscal year 2017. Net income in the
fourth quarter of 2018 was $2.3 million, compared to $3.4 million
in the fourth quarter of 2017.
- Cash and equivalents at quarter-end were $27.1
million, up from $18.2 million at the end of the third quarter of
2018, and $17.7 million in the fourth quarter of 2017.
Outlook
For fiscal year 2019, the Company expects revenue to be
approximately $100 million.
Conference Call Details
A conference call to discuss results will be held on Thursday,
March 7, 2019 at 8:00 a.m. Eastern Time (9:00 p.m. China Time).
Dial-in details for the call are as follows. Please reference
conference ID 8884467.
|
Phone Number |
Toll-Free Number |
|
|
|
United States |
+1 (845) 675-0437 |
+1 (866) 519-4004 |
Hong Kong |
+852 3018 6771 |
+852 8009 06601 |
Mainland China |
+86 (800) 819 0121 |
|
|
+86 (400) 620 8038 |
|
Other International |
+65 6713 5090 |
|
A recording of the webcast will be available on the investor
page of the ACM website at www.acmrcsh.com for one week following
the call.
Use of Non-GAAP Financial Measures
ACM presents non-GAAP gross margin, operating income , net
income (loss) and basic and diluted earnings per share as
supplemental measures to GAAP financial measures regarding ACM
Research’s operational performance. These supplemental measures
exclude the impact of stock-based compensation, which ACM does not
believe is indicative of its core operating results. A
reconciliation of each non-GAAP financial measure to the most
directly comparable GAAP financial measure is provided below under
“Reconciliation of Non-GAAP to GAAP Financial Measures.”
ACM believes these non-GAAP financial measures are useful to
investors in assessing its operating performance. ACM uses these
financial measures internally to evaluate its operating performance
and for planning and forecasting of future periods. Financial
analysts may focus on and publish both historical results and
future projections based on the non-GAAP financial measures. ACM
also believes it is in the best interests of investors for ACM to
provide this non-GAAP information.
While ACM believes these non-GAAP financial measures provide
useful supplemental information to investors, there are limitations
associated with the use of these non-GAAP financial measures. These
non-GAAP financial measures may not be reported by competitors, and
they may not be directly comparable to similarly titled measures of
other companies due to differences in calculation methodologies.
The non-GAAP financial measures are not an alternative to GAAP
information and are not meant to be considered in isolation or as a
substitute for comparable GAAP financial measures. They should be
used only as a supplement to GAAP information and should be
considered only in conjunction with ACM Research’s consolidated
financial statements prepared in accordance with GAAP.
Forward-Looking Statements
Information presented in the third paragraph of this press
release and under the heading “Outlook” above contains
forward-looking statements for purposes of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Actual results may vary significantly from ACM Research’s
expectations based on a number of risks and uncertainties,
including but not limited to the following: anticipated customer
orders or identified market opportunities may not grow or develop
as anticipated; customer orders already received may be postponed
or canceled; suppliers may not be able to meet ACM Research’s
demands on a timely basis; volatile global economic, market,
industry and other conditions could result in sharply lower demand
for products containing semiconductors and for the company's
products and in disruption of capital and credit markets; ACM
Research’s failure to successfully manage its operations; and trade
regulations, currency fluctuations, political instability and war
may materially adversely affect ACM due to its substantial non-U.S.
customer and supplier base and its substantial non-U.S.
manufacturing operations. ACM cannot guarantee any future results,
levels of activity, performance or achievements. ACM expressly
disclaims any obligation to update forward-looking statements after
the date of this press release.
About ACM Research, Inc.
ACM develops, manufactures and sells single-wafer wet cleaning
equipment, which semiconductor manufacturers can use in numerous
manufacturing steps to remove particles, contaminants and other
random defects, and thereby improve product yield, in fabricating
advanced integrated circuits.
© ACM Research, Inc. The ACM logo is a trademark of ACM
Research, Inc. All rights reserved. Any other trademarks are the
property of their respective owners.
|
For investor and media
inquiries, please contact: |
|
In the United States: |
|
The Blueshirt Group |
|
|
Ralph Fong |
|
|
+1 (415) 489-2195 |
|
|
ralph@blueshirtgroup.com |
|
|
|
In China: |
|
The Blueshirt Group Asia |
|
|
Gary Dvorchak, CFA |
|
|
+86 (138) 1079-1480 |
|
|
gary@blueshirtgroup.com |
|
|
|
|
|
|
ACM RESEARCH,
INC.Condensed Consolidated Balance
Sheets
|
|
|
December 31, 2018 |
|
December 31, 2017 |
|
(unaudited) |
|
(in thousands, except share and per share data) |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
27,124 |
|
|
$ |
17,681 |
|
Accounts receivable, less allowance for doubtful
accounts of $0 as of December 31, 2018 and $0 as of December 31,
2017 |
|
24,608 |
|
|
|
26,762 |
|
Other receivables |
|
3,547 |
|
|
|
2,491 |
|
Inventories |
|
38,764 |
|
|
|
15,388 |
|
Prepaid expenses |
|
1,985 |
|
|
|
546 |
|
Other current
assets |
|
- |
|
|
|
46 |
|
Total
current assets |
|
96,028 |
|
|
|
62,914 |
|
Property, plant and
equipment, net |
|
3,708 |
|
|
|
2,340 |
|
Intangible assets,
net |
|
274 |
|
|
|
106 |
|
Deferred tax
assets |
|
1,637 |
|
|
|
1,294 |
|
Investment in
affiliates, equity method |
|
1,360 |
|
|
|
1,237 |
|
Other long-term
assets |
|
40 |
|
|
|
- |
|
Total assets |
|
103,047 |
|
|
|
67,891 |
|
Liabilities and Stockholders’ Equity |
|
|
|
Current
liabilities: |
|
|
|
Short-term borrowings |
|
9,447 |
|
|
|
5,095 |
|
Warrant
liability |
|
- |
|
|
|
3,079 |
|
Accounts
payable |
|
16,673 |
|
|
|
7,419 |
|
Advances
from customers |
|
8,417 |
|
|
|
143 |
|
Income
taxes payable |
|
1,193 |
|
|
|
44 |
|
Other
payables and accrued expenses |
|
10,410 |
|
|
|
6,037 |
|
Total
current liabilities |
|
46,140 |
|
|
|
21,817 |
|
Other long-term
liabilities |
|
4,583 |
|
|
|
6,217 |
|
Total liabilities |
|
50,723 |
|
|
|
28,034 |
|
Commitments and
contingencies |
|
|
|
Stockholders’
equity: |
|
|
|
Common stock – Class A,
par value $0.0001: 100,000,000 shares authorized as of December 31,
2018 and 2017; 14,110,315 shares issued and outstanding as of
December 31, 2018 and 12,935,546 shares issued and outstanding as
of December 31, 2017 |
|
1 |
|
|
|
1 |
|
Common stock–Class B,
par value $0.0001: 7,303,533 shares authorized as of December 31,
2018 and 2017; 1,898,423 shares issued and outstanding as of
December 31, 2018 and 2,409,738 shares issued and outstanding as of
December 31, 2017 |
|
- |
|
|
|
- |
|
Additional paid in
capital |
|
56,567 |
|
|
|
49,695 |
|
Accumulated
deficit |
|
(3,387 |
) |
|
|
(9,961 |
) |
Accumulated other
comprehensive income (loss) |
|
(857 |
) |
|
|
122 |
|
Total stockholders’ equity |
|
52,324 |
|
|
|
39,857 |
|
Total liabilities and stockholders’ equity |
$ |
103,047 |
|
|
$ |
67,891 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ACM RESEARCH,
INC.Condensed Consolidated Statements of
Operations and Comprehensive Loss
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
( In thousands, except share and per share data) |
|
( In thousands, except share and per share data) |
Revenue |
$ |
20,848 |
|
|
$ |
17,192 |
|
|
$ |
74,643 |
|
|
$ |
36,506 |
|
Cost of revenue |
|
10,532 |
|
|
|
8,019 |
|
|
|
40,194 |
|
|
|
19,281 |
|
Gross profit |
|
10,316 |
|
|
|
9,173 |
|
|
|
34,449 |
|
|
|
17,225 |
|
Operating expenses: |
|
|
|
|
|
|
|
Sales and marketing |
|
1,845 |
|
|
|
1,881 |
|
|
|
9,611 |
|
|
|
5,500 |
|
Research and development |
|
4,156 |
|
|
|
2,062 |
|
|
|
10,380 |
|
|
|
5,138 |
|
General and administrative |
|
1,675 |
|
|
|
1,465 |
|
|
|
7,987 |
|
|
|
5,887 |
|
Total operating expenses, net |
|
7,676 |
|
|
|
5,408 |
|
|
|
27,978 |
|
|
|
16,525 |
|
Income (loss) from operations |
|
2,640 |
|
|
|
3,765 |
|
|
|
6,471 |
|
|
|
700 |
|
Interest income |
|
9 |
|
|
|
2 |
|
|
|
29 |
|
|
|
9 |
|
Interest expense |
|
(134 |
) |
|
|
(80 |
) |
|
|
(498 |
) |
|
|
(277 |
) |
Other expense, net |
|
42 |
|
|
|
(263 |
) |
|
|
1,255 |
|
|
|
(794 |
) |
Equity income in net income of affiliates |
|
(112 |
) |
|
|
17 |
|
|
|
123 |
|
|
|
37 |
|
Income
(loss) before income taxes |
|
2,445 |
|
|
|
3,441 |
|
|
|
7,380 |
|
|
|
(325 |
) |
Income tax benefit (expense) |
|
(159 |
) |
|
|
(76 |
) |
|
|
(806 |
) |
|
|
(547 |
) |
Net income (loss) |
|
2,286 |
|
|
|
3,365 |
|
|
|
6,574 |
|
|
|
(872 |
) |
Less: Net income
(loss) attributable to non-controlling interests |
|
- |
|
|
|
(19 |
) |
|
|
- |
|
|
|
(554 |
) |
Net income
(loss) attributable to ACM Research, Inc. |
$ |
2,286 |
|
|
$ |
3,384 |
|
|
$ |
6,574 |
|
|
$ |
(318 |
) |
Comprehensive income (loss) |
|
|
|
|
|
|
|
Net
income (loss) |
|
2,286 |
|
|
|
3,365 |
|
|
|
6,574 |
|
|
|
(872 |
) |
Foreign currency translation adjustment |
|
98 |
|
|
|
(20 |
) |
|
|
(979 |
) |
|
|
472 |
|
Comprehensive income (loss) |
|
2,384 |
|
|
|
3,345 |
|
|
|
5,595 |
|
|
|
(400 |
) |
Less: Comprehensive income
(loss) attributable to non-controlling interests |
|
- |
|
|
|
(22 |
) |
|
|
- |
|
|
|
(369 |
) |
Total comprehensive income
(loss) attributable to ACM Research, Inc. |
$ |
2,384 |
|
|
$ |
3,367 |
|
|
$ |
5,595 |
|
|
$ |
(31 |
) |
|
|
|
|
|
|
|
|
Net income
(loss) attributable to ACM Research, Inc.
per common share : |
|
|
|
|
|
|
|
Basic |
$ |
0.14 |
|
|
$ |
0.28 |
|
|
$ |
0.42 |
|
|
$ |
(0.05 |
) |
Diluted |
$ |
0.13 |
|
|
$ |
0.25 |
|
|
$ |
0.37 |
|
|
$ |
(0.05 |
) |
|
|
|
|
|
|
|
|
Weighted
average common shares outstanding used in computing per share amounts: |
Basic |
|
16,004,781 |
|
|
|
12,013,651 |
|
|
|
15,788,460 |
|
|
|
6,865,390 |
|
Diluted |
|
18,115,071 |
|
|
|
13,587,443 |
|
|
|
17,912,105 |
|
|
|
6,865,390 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ACM RESEARCH,
INC.Reconciliation of GAAP to Non-GAAP Financial
Measures
As described under “Use of Non-GAAP Financial Measures” above,
ACM presents non-GAAP gross margin, operating income and net income
(loss) as supplemental measures to GAAP financial measures, each of
which excludes stock-based compensation (“SBC”) from the equivalent
GAAP financial line items. The following tables reconcile gross
margin, operating income and net income (loss) to the related
non-GAAP financial measures:
|
|
Three Months Ended December 31, |
|
|
2018 |
|
|
2017 |
|
|
Actual |
SBC |
Adjusted |
Actual |
SBC |
Adjusted |
(GAAP) |
(Non-GAAP) |
(GAAP) |
(Non-GAAP) |
|
(in thousands) |
|
|
|
|
|
|
|
Revenue |
$ |
20,848 |
|
$ |
- |
|
$ |
20,848 |
|
$ |
17,192 |
|
$ |
- |
|
$ |
17,192 |
|
Cost of
revenue |
|
(10,532 |
) |
|
(27 |
) |
|
(10,505 |
) |
|
(8,019 |
) |
|
(6 |
) |
|
(8,013 |
) |
Gross
profit |
|
10,316 |
|
|
(27 |
) |
|
10,343 |
|
|
9,173 |
|
|
(6 |
) |
|
9,179 |
|
Operating
expenses: |
|
|
|
|
|
|
Sales and
marketing |
|
(1,845 |
) |
|
(5 |
) |
|
(1,840 |
) |
|
(1,881 |
) |
|
(18 |
) |
|
(1,863 |
) |
Research
and development |
|
(4,156 |
) |
|
(124 |
) |
|
(4,032 |
) |
|
(2,062 |
) |
|
(12 |
) |
|
(2,050 |
) |
General
and administrative |
|
(1,675 |
) |
|
(436 |
) |
|
(1,239 |
) |
|
(1,465 |
) |
|
105 |
|
|
(1,570 |
) |
Income
(Loss) from operations |
$ |
2,640 |
|
$ |
(592 |
) |
$ |
3,232 |
|
$ |
3,765 |
|
$ |
69 |
|
$ |
3,696 |
|
Net income (loss) attributable to ACM Research,
Inc. |
$ |
2,286 |
|
$ |
(592 |
) |
$ |
2,878 |
|
$ |
3,384 |
|
$ |
69 |
|
$ |
3,315 |
|
|
Net income (loss) attributable to ACM Research, Inc.
per common share : |
|
|
|
|
Basic |
$ |
0.14 |
|
$ |
(0.04 |
) |
$ |
0.18 |
|
$ |
0.28 |
|
$ |
0.01 |
|
$ |
0.28 |
|
Diluted |
$ |
0.13 |
|
$ |
(0.03 |
) |
$ |
0.16 |
|
$ |
0.25 |
|
$ |
0.01 |
|
$ |
0.24 |
|
|
|
|
Twelve Months Ended December 31, |
|
|
2018 |
|
|
2017 |
|
|
Actual |
SBC |
Adjusted |
Actual |
SBC |
Adjusted |
(GAAP) |
(Non-GAAP) |
(GAAP) |
(Non-GAAP) |
|
(in thousands) |
|
|
|
|
|
|
|
Revenue |
$ |
74,643 |
|
$ |
- |
|
$ |
74,643 |
|
$ |
36,506 |
|
$ |
- |
|
$ |
36,506 |
|
Cost of revenue |
|
(40,194 |
) |
|
(71 |
) |
|
(40,123 |
) |
|
(19,281 |
) |
|
(21 |
) |
|
(19,260 |
) |
Gross profit |
|
34,449 |
|
|
(71 |
) |
|
34,520 |
|
|
17,225 |
|
|
(21 |
) |
|
17,246 |
|
Operating expenses: |
|
|
|
|
|
|
Sales and marketing |
|
(9,611 |
) |
|
(120 |
) |
|
(9,491 |
) |
|
(5,500 |
) |
|
(53 |
) |
|
(5,447 |
) |
Research and development |
|
(10,380 |
) |
|
(255 |
) |
|
(10,125 |
) |
|
(5,138 |
) |
|
(50 |
) |
|
(5,088 |
) |
General and administrative |
|
(7,987 |
) |
|
(2,917 |
) |
|
(5,070 |
) |
|
(5,887 |
) |
|
(1,499 |
) |
|
(4,388 |
) |
Income (Loss) from operations |
$ |
6,471 |
|
$ |
(3,363 |
) |
$ |
9,834 |
|
$ |
700 |
|
$ |
(1,623 |
) |
$ |
2,323 |
|
Net income (loss)
attributable to ACM Research, Inc. |
$ |
6,574 |
|
$ |
(3,363 |
) |
$ |
9,937 |
|
$ |
(318 |
) |
$ |
(1,623 |
) |
$ |
1,305 |
|
|
Net income (loss) attributable to ACM Research, Inc.
per common share : |
|
|
|
|
Basic |
$ |
0.42 |
|
$ |
(0.21 |
) |
$ |
0.63 |
|
$ |
(0.05 |
) |
$ |
(0.24 |
) |
$ |
0.19 |
|
Diluted |
$ |
0.37 |
|
$ |
(0.19 |
) |
$ |
0.55 |
|
$ |
(0.05 |
) |
$ |
(0.24 |
) |
$ |
0.15 |
|
|
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