inTEST Corporation (NYSE American: INTT), a global supplier of
precision-engineered solutions for use in manufacturing and testing
across a wide range of markets, including automotive,
defense/aerospace, energy, industrial, semiconductor and
telecommunications, today announced financial results for the
quarter ended June 30, 2020.
2020 Second Quarter Financial
Summary
($ in Millions, Except
Per Share Data) |
Three Months Ended |
|
6/30/2020 |
3/31/2020 |
6/30/2019 |
Semi Market Bookings (1) |
$ |
7.3 |
|
$ |
6.7 |
|
$ |
8.6 |
|
Multimarket Bookings (2) |
|
6.6 |
|
|
7.1 |
|
|
7.3 |
|
Total Bookings |
$ |
13.9 |
|
$ |
13.8 |
|
$ |
15.9 |
|
|
|
|
|
Semi Market Bookings (1) - %
of Total Bookings |
|
52 |
% |
|
49 |
% |
|
54 |
% |
Multimarket Bookings (2) - %
of Total Bookings |
|
48 |
% |
|
51 |
% |
|
46 |
% |
|
|
|
|
Semi Market Net Revenues
(1) |
$ |
6.9 |
|
$ |
5.0 |
|
$ |
7.7 |
|
Multimarket Net Revenues
(2) |
|
6.4 |
|
|
6.2 |
|
|
6.7 |
|
Total Net Revenues |
$ |
13.3 |
|
$ |
11.2 |
|
$ |
14.4 |
|
|
|
|
|
Semi Market Net Revenues (1) -
% of Total Net Revenues |
|
52 |
% |
|
45 |
% |
|
53 |
% |
Multimarket Net Revenues (2) -
% of Total Net Revenues |
|
48 |
% |
|
55 |
% |
|
47 |
% |
|
|
|
|
Gross Margin |
$ |
6.1 |
|
$ |
4.9 |
|
$ |
6.7 |
|
Gross Margin |
|
46 |
% |
|
43 |
% |
|
47 |
% |
|
|
|
|
Net Earnings (Loss)
(GAAP) |
$ |
0.2 |
|
$ |
(1.1 |
) |
$ |
(0.2 |
) |
Net Earnings (Loss) per
diluted share (GAAP) |
$ |
0.02 |
|
$ |
(0.11 |
) |
$ |
(0.02 |
) |
|
|
|
|
Adjusted Net Earnings
(Non-GAAP) (3) |
$ |
0.5 |
|
$ |
(0.8 |
) |
$ |
0.1 |
|
Adjusted Net Earnings per
diluted share (Non-GAAP) (3) |
$ |
0.05 |
|
$ |
(0.08 |
) |
$ |
0.01 |
|
|
|
|
|
EBITDA (Non-GAAP) (3) |
$ |
0.7 |
|
$ |
(0.9 |
) |
$ |
0.2 |
|
|
|
|
|
|
As of |
|
6/30/2020 |
3/31/2020 |
12/31/2019 |
Cash and cash equivalents |
$ |
7.4 |
|
$ |
7.3 |
|
$ |
7.6 |
|
(1 |
) |
Semi Market: These amounts include all bookings and net
revenues from the semiconductor market. |
|
|
(2 |
) |
Multimarket: These amounts include all bookings and net
revenues from markets other than the semiconductor market. |
|
|
(3 |
) |
Adjusted Net Earnings, Adjusted Net Earnings per diluted share
and EBITDA are non-GAAP financial measures. Further information can
be found under “Non-GAAP Results.” See also the reconciliation of
GAAP measures to non-GAAP measures that accompanies this earnings
release. |
|
|
2020 Six Month Year-to-Date Financial
Summary
($ in Millions, Except
Per Share Data) |
Six Months Ended |
|
6/30/2020 |
6/30/2019 |
Semi Market Bookings (4) |
$ |
14.0 |
|
$ |
14.2 |
|
Multimarket Bookings (5) |
|
13.7 |
|
|
13.6 |
|
Total Bookings |
$ |
27.7 |
|
$ |
27.8 |
|
|
|
|
Semi Market Bookings (4) - %
of Total Bookings |
|
51 |
% |
|
51 |
% |
Multimarket Bookings (5) - %
of Total Bookings |
|
49 |
% |
|
49 |
% |
|
|
|
Semi Market Net Revenues
(4) |
$ |
11.9 |
|
$ |
17.7 |
|
Multimarket Net Revenues
(5) |
|
12.6 |
|
|
14.7 |
|
Total Net Revenues |
$ |
24.5 |
|
$ |
32.4 |
|
|
|
|
Semi Market Net Revenues (4) -
% of Total Net Revenues |
|
48 |
% |
|
55 |
% |
Multimarket Net Revenues (5) -
% of Total Net Revenues |
|
52 |
% |
|
45 |
% |
|
|
|
Gross Margin |
$ |
10.9 |
|
$ |
15.6 |
|
Gross Margin |
|
45 |
% |
|
48 |
% |
|
|
|
Net Earnings (Loss)
(GAAP) |
$ |
(1.0 |
) |
$ |
1.0 |
|
Net Earnings (Loss) per
diluted share (GAAP) |
$ |
(0.10 |
) |
$ |
0.09 |
|
|
|
|
Adjusted Net Earnings (Loss)
(Non-GAAP) (6) |
$ |
(0.4 |
) |
$ |
1.6 |
|
Adjusted Net Earnings (Loss)
per diluted share (Non-GAAP) (6) |
$ |
(0.04 |
) |
$ |
0.15 |
|
|
|
|
EBITDA (Non-GAAP) (6) |
$ |
(0.3 |
) |
$ |
2.2 |
|
(4 |
) |
Semi Market: These amounts include all bookings and net
revenues from the semiconductor market. |
|
|
(5 |
) |
Multimarket: These amounts include all bookings and net
revenues from markets other than the semiconductor market. |
|
|
(6 |
) |
Adjusted Net Earnings, Adjusted Net Earnings per diluted share
and EBITDA are non-GAAP financial measures. Further information can
be found under “Non-GAAP Results.” See also the reconciliation of
GAAP measures to non-GAAP measures that accompanies this earnings
release. |
Commenting on the Company’s second quarter financial results,
inTEST CFO and interim CEO Hugh Regan, Jr. noted, “Our results for
the quarter exceeded expectations, resulting in both revenue and
profitability growth. While the overall environment continues to be
challenging, largely in light of the COVID-19 pandemic resurgence,
we are seeing positive signs in the markets we serve, particularly
as they relate to semiconductor manufacturers. Our semiconductor
related revenues increased 37% compared to the first quarter of
2020. Consolidated revenues increased 18% sequentially, and were 2%
above our guidance and 10% above consensus estimates. Non-GAAP
adjusted net earnings per diluted share increased from a loss of
$0.08 per share in the first quarter of 2020 to earnings of $0.05
for the 2020 second quarter.”
2020 Third Quarter Financial
OutlookinTEST’s guidance for the 2020 third
quarter includes both GAAP and non-GAAP estimates. A reconciliation
between these GAAP and non-GAAP financial measures is included
below.
Actual results may differ materially as a result
of, among other things, the factors described under
“Forward-Looking Statements” below.
inTEST expects that net revenues for the third
quarter of 2020 will be in the range of $13.5 million to $14.5
million and that on a GAAP basis, net earnings per diluted share
will range from $0.01 to $0.06. On a non-GAAP basis, we expect our
adjusted net earnings per diluted share will range from $0.04 to
$0.09. In addition, we expect that gross margin will range from 46%
to 48%. This outlook is based on the Company’s current views with
respect to operating and market conditions and customers’
forecasts, all of which are subject to change.
2020 Second Quarter Supplemental Information and
Conference Call DetailsinTEST is providing Supplemental
Information (“Information”) in combination with its press release.
This Information is offered to provide stockholders and analysts
with additional time and detail for analyzing the Company’s
financial results in advance of the Company’s quarterly conference
call. The Information will be available in conjunction with the
press release on inTEST’s website www.intest.com, under the
“Investors” section.
inTEST management will host a conference call on Thursday,
August 6, 2020 at 6:00 pm Eastern Daylight Time. The conference
call will address the Company’s 2020 second quarter financial
results, and management’s current expectations and views of the
industry. The call may also include a discussion of strategic,
operating, product initiatives or developments, and other matters
relating to the Company’s current or future performance. To access
the live conference call, please dial (323) 794-2598 or (800)
458-4121. The Passcode for the conference call is 1878028. Please
reference the inTEST 2020 Q2 Financial Results Conference Call.
2020 Second Quarter Live Webcast DetailsinTEST
Corporation will provide a webcast in conjunction with the
conference call. To access the live webcast, please visit inTEST’s
website www.intest.com, under the “Investors” section.
2020 Second Quarter Replay Details (Webcast)A
replay of the webcast will be available on inTEST’s website for one
year following the live broadcast. To access the webcast replay,
please visit inTEST’s website www.intest.com, under the “Investors”
section.
Submit
QuestionsIn advance of the conference call, and
for those investors accessing the webcast, inTEST Corporation
welcomes individual investors to submit their questions via email
to laura@ga-ir.com.
Non-GAAP
ResultsIn addition to disclosing results that are
determined in accordance with GAAP, we also disclose non-GAAP
financial measures. These non-GAAP financial measures include
adjusted net earnings (loss), adjusted net earnings (loss) per
diluted share and EBITDA. Adjusted net earnings (loss) is derived
by adding acquired intangible amortization, adjusted for the
related income tax expense (benefit), to net earnings (loss).
Adjusted net earnings (loss) per diluted share is derived by
dividing adjusted net earnings (loss) by diluted weighted average
shares outstanding. EBITDA is derived by adding acquired intangible
amortization, interest expense, income tax expense, and
depreciation to net earnings (loss). These results are provided as
a complement to the results provided in accordance with GAAP.
Adjusted net earnings (loss), adjusted net earnings (loss) per
diluted share and EBITDA are non-GAAP financial measures presented
to provide investors with meaningful, supplemental information
regarding our baseline performance before acquired intangible
amortization charges and changes in the estimate of future
consideration that may be paid out related to prior acquisitions as
these expenses or income items may not be indicative of our current
core business or future outlook. These non-GAAP financial measures
are used by management to make operational decisions, to forecast
future operational results, and for comparison with our business
plan, historical operating results and the operating results of our
peers. A reconciliation from net earnings (loss) and net earnings
(loss) per diluted share to adjusted net earnings (loss) and
adjusted net earnings (loss) per diluted share and from net
earnings (loss) to EBITDA, which are discussed in this earnings
release, is contained in the tables below. The non-GAAP financial
measures discussed in this earnings release may not be comparable
to similarly titled measures used by other companies. The
presentation of non-GAAP financial measures is not meant to be
considered in isolation, as a substitute for, or superior to,
financial measures or information provided in accordance with
GAAP.
About inTEST CorporationinTEST
Corporation is a global supplier of precision-engineered
solutions for use in manufacturing and
testing across a wide range of markets including automotive,
defense/aerospace, energy, industrial, semiconductor and
telecommunications. Backed by decades of engineering expertise and
a culture of operational excellence, we solve difficult thermal,
mechanical and electronic challenges for customers worldwide while
generating strong cash flow and profits. Our strategy uses these
strengths to grow and increase stockholder value by maximizing our
businesses and by identifying, acquiring and optimizing
complementary businesses.
For more information visit www.intest.com.
Forward-Looking StatementsThis
press release includes forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, as
amended. These statements do not convey historical information but
relate to predicted or potential future events and financial
results, such as statements of our plans, strategies and
intentions, or our future performance or goals, that are based upon
management's current expectations. Our forward-looking statements
can often be identified by the use of forward-looking terminology
such as “believes,” “expects,” “intends,” “may,” “will,” “should,”
“plans,” “projects,” “forecasts,” “outlook,” “anticipates” or
similar terminology. These statements are subject to risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied by such statements.
In addition to the factors mentioned in this
press release, such risks and uncertainties include, but are not
limited to, the impact of the COVID-19 pandemic on our business,
liquidity, financial condition and results of operations, including
as a result of evolving public health requirements in response to
the pandemic such as government mandated facility closures,
availability of employees, supply chain and distribution
interruptions, customers’ inability or refusal to accept product
deliveries and the sufficiency of our current level of working
capital to address our cash requirements; indications of a change
in the market cycles in the Semi Market or other markets we serve
including as a result of the COVID-19 pandemic; changes in business
conditions and general economic conditions both domestically and
globally; changes in the demand for semiconductors, generally and
as a result of the COVID-19 pandemic; the success of our strategy
to diversify our business by entering markets outside the Semi
Market; the possibility of future acquisitions or dispositions and
the successful integration of any acquired operations; our ability
to borrow funds or raise capital to finance potential acquisitions;
changes in the rates and timing of capital expenditures by our
customers including as a result of the COVID-19 pandemic; success
of product development programs; increases in raw material and
fabrication costs associated with our products; and other risk
factors set forth from time to time in our Securities and Exchange
Commission filings, including, but not limited to, our annual
report on Form 10-K for the year ended December 31, 2019 and
quarterly report on Form 10-Q for the quarter ended March 31, 2020
and subsequent quarterly reports on Form 10-Q. Any forward-looking
statement made by us in this press release is based only on
information currently available to us and speaks to circumstances
only as of the date on which it is made. We undertake no obligation
to update the information in this press release to reflect events
or circumstances after the date hereof or to reflect the occurrence
of anticipated or unanticipated events.
SELECTED FINANCIAL
DATA(Unaudited)(In thousands, except per share data)
Condensed Consolidated Statements of Operations
Data:
|
Three Months Ended |
|
Six Months Ended |
|
6/30/2020 |
|
6/30/2019 |
|
3/31/2020 |
|
6/30/2020 |
|
6/30/2019 |
|
|
|
|
|
|
|
|
|
|
Net revenues |
$ |
13,275 |
|
|
$ |
14,352 |
|
|
$ |
11,230 |
|
|
$ |
24,505 |
|
|
$ |
32,414 |
Gross margin |
|
6,067 |
|
|
|
6,719 |
|
|
|
4,867 |
|
|
|
10,934 |
|
|
|
15,555 |
Operating expenses: |
|
|
|
|
|
|
|
|
|
Selling expense |
|
1,761 |
|
|
|
2,087 |
|
|
|
2,052 |
|
|
|
3,813 |
|
|
|
4,461 |
Engineering and product development expense |
|
1,217 |
|
|
|
1,208 |
|
|
|
1,292 |
|
|
|
2,509 |
|
|
|
2,492 |
General and administrative expense |
|
2,888 |
|
|
|
3,718 |
|
|
|
2,884 |
|
|
|
5,772 |
|
|
|
7,455 |
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
201 |
|
|
|
(294 |
) |
|
|
(1,361 |
) |
|
|
(1,160 |
) |
|
|
1,147 |
Other income (loss) |
|
(18 |
) |
|
|
(6 |
) |
|
|
(32 |
) |
|
|
(50 |
) |
|
|
15 |
Earnings (loss) before income
tax expense (benefit) |
|
183 |
|
|
|
(300 |
) |
|
|
(1,393 |
) |
|
|
(1,210 |
) |
|
|
1,162 |
Income tax expense
(benefit) |
|
13 |
|
|
|
(113 |
) |
|
|
(250 |
) |
|
|
(237 |
) |
|
|
211 |
Net earnings (loss) |
|
170 |
|
|
|
(187 |
) |
|
|
(1,143 |
) |
|
|
(973 |
) |
|
|
951 |
|
|
|
|
|
|
|
|
|
|
Net earnings (loss) per share
– basic |
$ |
0.02 |
|
|
$ |
(0.02 |
) |
|
$ |
(0.11 |
) |
|
$ |
(0.10 |
) |
|
$ |
0.09 |
Weighted average shares
outstanding – basic. |
|
10,252 |
|
|
|
10,411 |
|
|
|
10,221 |
|
|
|
10,237 |
|
|
|
10,398 |
|
|
|
|
|
|
|
|
|
|
Net earnings (loss) per share
– diluted |
$ |
0.02 |
|
|
$ |
(0.02 |
) |
|
$ |
(0.11 |
) |
|
$ |
(0.10 |
) |
|
$ |
0.09 |
Weighted average shares
outstanding – diluted |
|
10,259 |
|
|
|
10,411 |
|
|
|
10,221 |
|
|
|
10,237 |
|
|
|
10,420 |
Condensed Consolidated Balance Sheets Data:
|
As of: |
|
6/30/2020 |
|
3/31/2020 |
|
12/31/2019 |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
7,424 |
|
$ |
7,318 |
|
$ |
7,612 |
Trade accounts receivable,
net |
|
9,457 |
|
|
8,052 |
|
|
9,296 |
Inventories |
|
7,930 |
|
|
7,720 |
|
|
7,182 |
Total current assets |
|
25,256 |
|
|
23,776 |
|
|
24,895 |
Net property and
equipment. |
|
2,295 |
|
|
2,341 |
|
|
2,420 |
Total assets |
|
59,858 |
|
|
59,059 |
|
|
59,715 |
Accounts payable. |
|
2,618 |
|
|
2,299 |
|
|
1,984 |
Accrued expenses. |
|
4,163 |
|
|
3,754 |
|
|
4,207 |
Total current liabilities |
|
8,790 |
|
|
8,016 |
|
|
8,361 |
Noncurrent liabilities. |
|
6,889 |
|
|
7,277 |
|
|
6,520 |
Total stockholders'
equity. |
|
44,179 |
|
|
43,766 |
|
|
44,834 |
Reconciliation of Net Earnings (Loss) (GAAP) to Adjusted
Net Earnings (Non-GAAP) and Net Earnings (Loss) Per Share – Diluted
(GAAP) to Adjusted Net Earnings Per Share – Diluted
(Non-GAAP):
|
Three Months Ended |
|
Six Months Ended |
|
6/30/2020 |
|
6/30/2019 |
|
3/31/2020 |
|
6/30/2020 |
|
6/30/2019 |
|
|
|
|
|
|
|
|
|
|
Net earnings (loss) (GAAP) |
$ |
170 |
|
|
$ |
(187 |
) |
|
$ |
(1,143 |
) |
|
$ |
(973 |
) |
|
$ |
951 |
|
Acquired intangible amortization |
|
309 |
|
|
|
315 |
|
|
|
311 |
|
|
|
620 |
|
|
|
632 |
|
Tax adjustments |
|
(5 |
) |
|
|
(3 |
) |
|
|
(4 |
) |
|
|
(9 |
) |
|
|
(8 |
) |
Adjusted net earnings (loss)
(Non-GAAP) |
$ |
474 |
|
|
$ |
125 |
|
|
$ |
(836 |
) |
|
$ |
(362 |
) |
|
$ |
1,575 |
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted average
shares outstanding |
|
10,259 |
|
|
|
10,425 |
|
|
|
10,221 |
|
|
|
10,237 |
|
|
|
10,420 |
|
|
|
|
|
|
|
|
|
|
|
Net earnings per share –
diluted: |
|
|
|
|
|
|
|
|
|
Net earnings (loss) (GAAP) |
$ |
0.02 |
|
|
$ |
(0.02 |
) |
|
$ |
(0.11 |
) |
|
$ |
(0.10 |
) |
|
$ |
0.09 |
|
Acquired intangible amortization |
|
0.03 |
|
|
|
0.03 |
|
|
|
0.03 |
|
|
|
0.06 |
|
|
|
0.06 |
|
Tax adjustments |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Adjusted net earnings (loss)
per share – diluted (Non-GAAP) |
$ |
0.05 |
|
|
$ |
0.01 |
|
|
$ |
(0.08 |
) |
|
$ |
(0.04 |
) |
|
$ |
0.15 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net Earnings (Loss) (GAAP) to EBITDA
(Non-GAAP):
|
Three Months Ended |
|
Six Months Ended |
|
6/30/2020 |
|
6/30/2019 |
|
3/31/2020 |
|
6/30/2020 |
|
6/30/2019 |
|
|
|
|
|
|
|
|
|
|
Net earnings (loss) (GAAP) |
$ |
170 |
|
$ |
(187 |
) |
|
$ |
(1,143 |
) |
|
$ |
(973 |
) |
|
$ |
951 |
Acquired intangible amortization |
|
309 |
|
|
315 |
|
|
|
311 |
|
|
|
620 |
|
|
|
632 |
Interest expense |
|
25 |
|
|
- |
|
|
|
- |
|
|
|
25 |
|
|
|
- |
Income tax expense (benefit) |
|
13 |
|
|
(113 |
) |
|
|
(250 |
) |
|
|
(237 |
) |
|
|
211 |
Depreciation |
|
155 |
|
|
184 |
|
|
|
155 |
|
|
|
310 |
|
|
|
365 |
EBITDA (Non-GAAP) |
$ |
672 |
|
$ |
199 |
|
|
$ |
(927 |
) |
|
$ |
(255 |
) |
|
$ |
2,159 |
|
|
|
|
|
|
|
|
|
|
Supplemental Information – Reconciliation of Third
Quarter 2020 Estimated Net Earnings Per Share – Diluted (GAAP) to
Estimated Adjusted Net Earnings Per Share – Diluted
(Non-GAAP):
|
Low |
|
High |
|
|
|
|
Estimated net earnings per share – diluted (GAAP) |
$ |
0.01 |
|
$ |
0.06 |
Estimated acquired intangible amortization |
|
0.03 |
|
|
0.03 |
Estimated tax adjustments. |
|
- |
|
|
- |
Estimated adjusted net
earnings per share – diluted (Non-GAAP) |
$ |
0.04 |
|
$ |
0.09 |
Contacts
inTEST Corporation
Hugh T. Regan, Jr.
Treasurer, Chief Financial Officer and Interim CEO
Tel: 856-505-8999
Investors:
Laura Guerrant-Oiye, Principal
Guerrant Associates
laura@ga-ir.com
Tel: (808) 960-2642
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