AEIS Advanced Energy Industries Inc

Advanced Energy Industries, Inc. (Nasdaq GM: AEIS) today announced financial results for the first quarter ended March 31, 2011. The company posted first quarter sales of $137.7 million, operating income of 17.7%, and earnings of $0.43 per diluted share from continuing operations.

“Advanced Energy had another quarter of solid financial and organizational performance. Our strategy to transition the company to a diversified business model paid dividends this quarter as increased shipments in our thin films business minimized the seasonality of our renewables business,” said Dr. Hans Betz, chief executive officer.

Total revenue of $137.7 million was split between Thin Films at $100.1 million and $37.6 million in the Renewables Business Unit. Thin films sales were primarily driven by strength in the semiconductor market. Renewables sales were impacted by the North American market first quarter seasonality, but delivered record bookings of $65.5 million for the quarter.

“We are very excited about our announcement today that our inverters have been chosen for two major Utility projects: a 150MW project with Zachry in Arizona and a 35MW project in California with Cupertino Electric, demonstrating the differentiated reliability and efficiency of our inverters and the subsequent impact on the levelized cost of energy. We are seeing a growing number of larger, Utility scale projects as the solar market continues its expansion,” said Dr. Hans Betz, chief executive officer.

Operating income grew to $24.4 million or 17.7% of revenue, the 8th consecutive quarter of improved operating results. This continued strength was the result of our aggressive management of operating expenses as we continue to refine our strategic business units. Net income from continuing operations was $18.8 million or $0.43 per diluted share, compared to net income from continuing operations of $19.7 million or $0.45 per diluted share in the fourth quarter of 2010. This decline was due to an increase in the company’s effective tax rate to 25% in the first quarter of 2011 from 19% in the fourth quarter of 2010.

Bookings for the first quarter were $184.0 million, compared to $83.2 million in the first quarter of 2010.

Thin Films Business Unit

Thin Films business unit sales climbed to $100.1 million versus $67.4 million in the same period of 2010, a 49% improvement year over year. This growth reflects the continued strength in the semiconductor industry and demonstrated our strength in advanced power solutions for Etch and Deposition applications. We also benefitted from another strong quarter in the solar panel and glass market as we continue to leverage our leading position in crystalline silicon processing equipment and strategic customer relationships to address the current growth in China.

Renewables Business Unit

Renewables business unit sales were $37.6 million in the quarter versus $2.3 million in the same period of 2010. This significant year over year improvement reflects the acquisition of PV Powered as well continued growth of the North American solar market. Our focus on building a leading position in the strategic commercial and Utility segments of the inverter market continued this quarter with record bookings reflecting the many growth opportunities ahead.

Second Quarter 2011 Guidance

The Company anticipates second quarter 2011 results from continuing operations, to be within the following ranges:

• Sales of $148 million to $160 million
• Earnings per share of $0.36 to $0.44

First Quarter 2011 Conference Call

Management will host a conference call tomorrow, Tuesday, May 3, 2011, at 8:30 a.m. Eastern Daylight Time to discuss Advanced Energy's financial results. Domestic callers may access this conference call by dialing (800) 299-6183. International callers may access the call by dialing (617) 801-9173. Participants will need to provide a conference pass code 79453281. For a replay of this teleconference, please call (888) 286-8010 or (617) 801-6888, and enter the pass code 79453281. The replay will be available for two weeks following the conference call. A webcast will also be available on the Investor Relations web page at http://ir.advanced-energy.com.

About Advanced Energy

Advanced Energy (NASDAQ: AEIS - News) is a global leader in innovative power and control technologies forthin-film manufacturing and high-growth solar-power generation. Advanced Energy is headquartered in Fort Collins, Colorado, with dedicated support and service locations around the world. For more information, go to www.advanced-energy.com.

Forward-Looking Language

The Company’s expectations with respect to guidance to financial results for the second quarter ending June 30, 2011 and statements that are not historical information are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to: the effects of global macroeconomic conditions upon demand for our products, the volatility and cyclicality of the industries the company serves, particularly the semiconductor industry, the continuation of RPS (renewable portfolio standards), the timing and availability of incentives and grant programs in the US and Europe related to the renewable energy market, the timing of orders received from customers, the company's ability to realize benefits from cost improvement efforts, the ability to source materials and manufacture products, and unanticipated changes to management's estimates, reserves or allowances. These and other risks are described in Advanced Energy's Form 10-K, Forms 10-Q and other reports and statements filed with the Securities and Exchange Commission. These reports and statements are available on the SEC's website at www.sec.gov. Copies may also be obtained from Advanced Energy's website at www.advancedenergy.com or by contacting Advanced Energy's investor relations at 970-407-6555. Forward-looking statements are made and based on information available to the company on the date of this press release. The company assumes no obligation to update the information in this press release.

 

ADVANCED ENERGY INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share data)         Three Months Ended March 31, December 31, 2011 2010 2010   SALES $ 137,652 $ 69,687 $

148,653

COST OF SALES   75,607     40,480     83,910   GROSS PROFIT 62,045 29,207 64,743 45.1 % 41.9 % 43.6 % OPERATING EXPENSES: Research and development 15,862 11,142 15,275 Selling, general and administrative 20,905 12,229 24,586 Amortization of intangible assets   921     -     920   Total operating expenses   37,688     23,371     40,781     INCOME FROM OPERATIONS 24,357 5,836 23,962   Other income, net   663     385     392   Income from continuing operations before income taxes 25,020 6,221 24,354 Provision for income taxes   6,254     1,371     4,624   INCOME FROM CONTINUING OPERATIONS 18,766 4,850 19,730   Gain on sale of discontinued operations, net of tax - - 12,531 Results from discontinued operations, net of tax   140     1,367     (853 )   INCOME FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES   140     1,367     11,678     NET INCOME $ 18,906   $ 6,217   $ 31,408     Basic weighted-average common shares outstanding 43,440 42,074 43,315 Diluted weighted-average common shares outstanding 44,133 42,680 43,796   EARNINGS PER SHARE: CONTINUING OPERATIONS: BASIC EARNINGS PER SHARE $ 0.43 $ 0.12 $ 0.46 DILUTED EARNINGS PER SHARE $ 0.43 $ 0.11 $ 0.45   DISCONTINUED OPERATIONS BASIC EARNINGS PER SHARE $ 0.00 $ 0.03 $ 0.27 DILUTED EARNINGS PER SHARE $ 0.00 $ 0.03 $ 0.27   NET INCOME: BASIC EARNINGS PER SHARE $ 0.44 $ 0.15 $ 0.73 DILUTED EARNINGS PER SHARE $ 0.43 $ 0.15 $ 0.72     ADVANCED ENERGY INDUSTRIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands)       March 31, December 31, 2011 2010 ASSETS   Current assets: Cash and cash equivalents $ 132,418 $ 130,914 Marketable securities 7,620 9,640 Accounts receivable, net 121,236 119,893 Inventories, net 90,109 77,593 Deferred income taxes 7,689 7,510 Income taxes receivable 9,435 6,061 Other current assets   9,179   10,156 Total current assets 377,686 361,767   Property and equipment, net 36,210 34,569   Deposits and other 8,874 8,874 Goodwill and intangibles, net 95,860 96,781 Deferred income tax assets, net   3,166   3,166 Total assets $ 521,796 $ 505,157   LIABILITIES AND STOCKHOLDERS' EQUITY   Current liabilities: Accounts payable $ 51,974 $ 56,185 Other accrued expenses   43,005   46,140 Total current liabilities 94,979 102,325   Long-term liabilities  

29,959

  28,864   Total liabilities

124,938

131,189   Stockholders' equity   396,858   373,968 Total liabilities and stockholders' equity $

521,796

$ 505,157     ADVANCED ENERGY INDUSTRIES, INC. SEGMENT INFORMATION (in thousands)           Three Months Ended March 31, December 31, 2011 2010 2010 SALES: Thin Films $ 100,099 $ 67,423 $ 96,960 Renewables   37,553     2,264   51,693 Total Sales   137,652     69,687   148,653     OPERATING INCOME: Thin Films $ 24,824 Renewables   2,512   Total segment operating income 27,336 Corporate expenses (2,979 ) Other income, net   663   Income from continuing operations before income taxes $ 25,020