Photronics Reports Full Year and Fourth Quarter Fiscal 2022 Results
December 13 2022 - 6:00AM
Photronics, Inc. (NASDAQ:PLAB), a worldwide leader in photomask
technologies and solutions, today reported financial results for
its fiscal 2022 full year and fourth quarter ended October 31,
2022.
“We posted a solid finish to a great year,
achieving record revenue for the fifth consecutive year as demand
for our design-driven products remained strong and our entire team
performed well,” said Frank Lee, chief executive officer. “In the
quarter, IC was soft, primarily due to lower high-end logic demand
from foundries in Asia. High-end FPD also declined as panel makers
of premium smart phones are focused on producing new products and
have temporarily slowed design activity. Profit margins were flat
sequentially as positive pricing and cost management offset the
impact from lower volumes. We generated strong cash from
operations, allowing us to invest in organic growth and reduce
debt, strengthening our balance sheet and positioning us to support
our growth strategy as well as helping us to navigate economic
uncertainty. The global Photronics team performed well in 2022, and
we believe we will continue to achieve our goals in 2023 and
beyond.”
Full Year 2022 Results
- Revenue of $824.5 million was up
24% over the previous year and was the fifth consecutive year of
record revenue
- Net income attributable to
Photronics, Inc. shareholders was $118.8 million ($1.94 per diluted
share), compared with $55.4 million ($0.89 per diluted share) in
2021
- Integrated circuit (IC) revenue was
$593.0 million, up 29%
- Flat panel display (FPD) revenue
was $231.5 million, up 14%
- Cash and short-term investments
increased to $359 million, with $275 million generated from
operating activities and $112 million invested in growth through
capital expenditures
Fourth Quarter 2022 Results
- Revenue was $210.3 million, down 4%
sequentially and up 16% compared with the same period of last
year
- Net income attributable to
Photronics, Inc. shareholders was $37.1 million ($0.60 per diluted
share), compared with $31.2 million ($0.51 per diluted share) in
the third quarter of 2022 and $19.8 million ($0.33 per diluted
share) in the fourth quarter 2021
- IC revenue was $156.2 million, down
3% sequentially and up 25% compared with the same period of last
year
- FPD revenue was $54.1 million, down
8% sequentially and down 3% compared with the same period of last
year
- Cash generated from operating
activities was $79 million and cash invested in growth through
capital expenditures was $66 million
First Quarter 2023 Guidance
For the first quarter of 2023, Photronics
expects revenue to be between $203 million and $213 million and net
income attributable to Photronics, Inc. shareholders to be between
$0.40 and $0.48 per diluted share.
Webcast
A webcast to discuss these results is scheduled
for 8:30 a.m. Eastern time on Tuesday, December 13, 2022. The
webcast will be broadcast live and on-demand on the Events and
Presentations link on the Photronics website or click here. 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, 2022, the company had 1,828 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.
PHOTRONICS,
INC. |
Condensed
Consolidated Statements of Income |
(in thousands,
except per share amounts) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
|
|
|
October
31, |
|
July
31, |
|
October
31, |
|
October
31, |
|
October
31, |
|
|
|
|
2022 |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
|
$ |
210,266 |
|
$ |
219,948 |
|
|
$ |
181,288 |
|
$ |
824,549 |
|
|
$ |
663,761 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold |
|
|
|
129,997 |
|
|
136,085 |
|
|
|
129,347 |
|
|
530,336 |
|
|
|
496,717 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit |
|
|
|
|
80,269 |
|
|
83,863 |
|
|
|
51,941 |
|
|
294,213 |
|
|
|
167,044 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
15,683 |
|
|
15,960 |
|
|
|
14,322 |
|
|
63,989 |
|
|
|
57,525 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
4,045 |
|
|
4,151 |
|
|
|
4,100 |
|
|
18,341 |
|
|
|
18,490 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses |
|
|
19,728 |
|
|
20,111 |
|
|
|
18,422 |
|
|
82,330 |
|
|
|
76,015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating (loss) income, net |
|
- |
|
|
(23 |
) |
|
|
- |
|
|
(17 |
) |
|
|
3,525 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income |
|
|
|
60,541 |
|
|
63,729 |
|
|
|
33,519 |
|
|
211,866 |
|
|
|
94,554 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-operating income, net |
|
|
10,797 |
|
|
3,641 |
|
|
|
3,809 |
|
|
27,167 |
|
|
|
7,452 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Tax
Provision |
|
71,338 |
|
|
67,370 |
|
|
|
37,328 |
|
|
239,033 |
|
|
|
102,006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision |
|
|
|
16,074 |
|
|
18,146 |
|
|
|
8,697 |
|
|
59,791 |
|
|
|
23,190 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income |
|
|
|
|
55,264 |
|
|
49,224 |
|
|
|
28,631 |
|
|
179,242 |
|
|
|
78,816 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to noncontrolling interests |
|
18,204 |
|
|
17,994 |
|
|
|
8,820 |
|
|
60,456 |
|
|
|
23,367 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Photronics, Inc. shareholders |
|
|
|
$ |
37,060 |
|
$ |
31,230 |
|
|
$ |
19,811 |
|
$ |
118,786 |
|
|
$ |
55,449 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
$ |
0.61 |
|
$ |
0.51 |
|
|
$ |
0.33 |
|
$ |
1.96 |
|
|
$ |
0.90 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
|
$ |
0.60 |
|
$ |
0.51 |
|
|
$ |
0.33 |
|
$ |
1.94 |
|
|
$ |
0.89 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average number of common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
60,773 |
|
|
60,701 |
|
|
|
60,216 |
|
|
60,559 |
|
|
|
61,407 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
|
|
61,374 |
|
|
61,299 |
|
|
|
60,908 |
|
|
61,189 |
|
|
|
61,999 |
|
|
|
|
|
|
|
|
|
|
|
|
|
PHOTRONICS,
INC. |
Condensed
Consolidated Balance Sheets |
(in thousands) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
October
31, |
|
October
31, |
|
|
|
|
2022 |
|
2021 |
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
319,680 |
|
$ |
276,670 |
Short-term investments |
|
|
38,820 |
|
|
- |
Accounts receivable |
|
|
198,147 |
|
|
174,447 |
Inventories |
|
|
|
50,753 |
|
|
55,249 |
Other current assets |
|
|
37,252 |
|
|
44,250 |
|
|
|
|
|
|
|
Total current assets |
|
|
644,652 |
|
|
550,616 |
|
|
|
|
|
|
|
Property, plant and equipment, net |
|
643,873 |
|
|
696,553 |
Other assets |
|
|
|
27,305 |
|
|
47,033 |
|
|
|
|
|
|
|
Total assets |
|
|
$ |
1,315,830 |
|
$ |
1,294,202 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Equity |
|
|
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Current portion of long-term debt |
$ |
10,024 |
|
$ |
22,248 |
Accounts payable and accrued liabilities |
|
183,773 |
|
|
153,900 |
|
|
|
|
|
|
|
Total current liabilities |
|
|
193,797 |
|
|
176,148 |
|
|
|
|
|
|
|
Long-term debt |
|
|
|
32,310 |
|
|
89,446 |
Other liabilities |
|
|
|
27,634 |
|
|
28,046 |
|
|
|
|
|
|
|
Photronics, Inc. shareholders' equity |
|
831,527 |
|
|
823,692 |
Noncontrolling interests |
|
|
230,562 |
|
|
176,870 |
Total equity |
|
|
|
1,062,089 |
|
|
1,000,562 |
|
|
|
|
|
|
|
Total liabilities and equity |
|
$ |
1,315,830 |
|
$ |
1,294,202 |
|
|
|
|
|
|
|
PHOTRONICS,
INC. |
Condensed
Consolidated Statements of Cash Flows |
(in thousands) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
|
|
|
|
October
31, |
|
October
31, |
|
|
|
|
|
2022 |
|
2021 |
|
|
|
|
|
|
|
|
Cash flows from operating activities: |
|
|
|
|
Net income |
|
|
|
$ |
179,242 |
|
|
$ |
78,816 |
|
Adjustments to reconcile net income
to net cash |
|
|
|
provided by operating
activities: |
|
|
|
|
Depreciation
and amortization |
|
|
80,330 |
|
|
|
90,396 |
|
Share-based
compensation |
|
|
6,308 |
|
|
|
5,348 |
|
Changes in
operating assets, liabilities and other |
|
9,307 |
|
|
|
(23,788 |
) |
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
275,187 |
|
|
|
150,772 |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
Purchases of property,
plant and equipment |
|
(112,338 |
) |
|
|
(109,099 |
) |
Purchases of
available-for-sale debt securities |
|
(38,854 |
) |
|
|
- |
|
Government
incentives |
|
|
|
3,615 |
|
|
|
5,775 |
|
Other |
|
|
|
|
|
(180 |
) |
|
|
(170 |
) |
|
|
|
|
|
|
|
|
Net cash used in investing activities |
|
|
(147,757 |
) |
|
|
(103,494 |
) |
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
Repayments of debt |
|
|
|
(65,440 |
) |
|
|
(20,352 |
) |
Purchases of treasury
stock |
|
|
(2,522 |
) |
|
|
(48,249 |
) |
Contributions from
noncontrolling interest |
|
24,995 |
|
|
|
- |
|
Dividends paid to
noncontrolling interests |
|
- |
|
|
|
(9,597 |
) |
Proceeds from share-based
arrangements |
|
5,749 |
|
|
|
3,874 |
|
Proceeds from long-term
debt |
|
|
- |
|
|
|
20,858 |
|
Net settlements of
restricted stock awards |
|
(1,471 |
) |
|
|
(437 |
) |
|
|
|
|
|
|
|
|
Net cash used in financing activities |
|
|
(38,689 |
) |
|
|
(53,903 |
) |
|
|
|
|
|
|
|
|
Effects of exchange rate changes on cash, cash equivalents, and
restricted cash |
|
(46,012 |
) |
|
|
4,703 |
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash, cash equivalents, and restricted
cash |
|
42,729 |
|
|
|
(1,922 |
) |
Cash, cash equivalents, and restricted cash, beginning of
period |
|
279,680 |
|
|
|
281,602 |
|
|
|
|
|
|
|
|
|
Cash, cash equivalents, and restricted cash, end of period |
$ |
322,409 |
|
|
$ |
279,680 |
|
For Further Information:John P.
JordanExecutive Vice President &
CFO203.740.5671jjordan@photronics.com
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