Coherent, Inc. (NASDAQ, COHR), one of the world’s leading
providers of lasers, laser-based technologies and laser-based
system solutions in a broad range of scientific, commercial and
industrial applications, today announced financial results for its
second fiscal quarter ended April 2, 2022.
FINANCIAL HIGHLIGHTS
Three Months Ended
Six Months Ended
Apr. 2, 2022
Jan. 1, 2022
Apr. 3, 2021
Apr. 2, 2022
Apr. 3, 2021
GAAP Results
(in millions, except per share data)
Net sales
$
370.2
$
384.5
$
374.0
$
754.7
$
700.0
Net income (loss)
$
33.7
$
30.3
$
(158.2
)
$
63.9
$
(158.1
)
Diluted EPS
$
1.35
$
1.21
$
(6.49
)
$
2.57
$
(6.50
)
Non-GAAP Results
(in millions, except per share data)
Net income
$
42.5
$
57.7
$
35.2
$
100.2
$
61.9
Diluted EPS
$
1.70
$
2.32
$
1.42
$
4.02
$
2.52
SECOND FISCAL QUARTER DETAILS
For the second quarter of fiscal 2022, Coherent announced net
sales of $370.2 million and net income, on a U.S. generally
accepted accounting principles (GAAP) basis, of $33.7 million, or
$1.35 per diluted share.
These results compare to net sales of $374.0 million and net
loss of $158.2 million, or $6.49 per diluted share, for the second
quarter of fiscal 2021 and net sales of $384.5 million and net
income of $30.3 million, or $1.21 per diluted share, for the first
quarter of fiscal 2022. The net loss in the second quarter of
fiscal 2021 includes $179.2 million, net of tax, in merger and
acquisition costs, primarily due to a merger agreement termination
fee paid to Lumentum Holdings Inc.
Non-GAAP net income for the second quarter of fiscal 2022 was
$42.5 million, or $1.70 per diluted share. Non-GAAP net income for
the second quarter of fiscal 2021 was $35.2 million, or $1.42 per
diluted share. Non-GAAP net income for the first quarter of fiscal
2022 was $57.7 million, or $2.32 per diluted share. Reconciliations
of GAAP to non-GAAP financial measures for the three months ended
April 2, 2022, January 1, 2022 and April 3, 2021 and six months
ended April 2, 2022 and April 3, 2021 appear in the financial
statements portion of this release under the heading
“Reconciliation of GAAP to Non-GAAP net income.”
Summarized statement of operations
information is as follows (unaudited, in thousands, except per
share data):
Three Months Ended
Six Months Ended
Apr. 2, 2022
Jan. 1, 2022
Apr. 3, 2021
Apr. 2, 2022
Apr. 3, 2021
Net sales
$
370,204
$
384,507
$
373,982
$
754,711
$
700,035
Cost of sales(A)(B)(C)(D)
215,670
216,943
232,957
432,613
439,014
Gross profit
154,534
167,564
141,025
322,098
261,021
Operating expenses:
Research &
development(A)(B)(D)
31,679
29,769
32,007
61,448
60,228
Selling, general &
administrative(A)(B)(D)
66,517
93,774
72,662
160,291
146,890
Merger and acquisition costs(E)
1,044
977
231,996
2,021
231,996
Amortization of intangible
assets(C)
563
565
596
1,128
1,193
Total operating expenses
99,803
125,085
337,261
224,888
440,307
Income (loss) from operations
54,731
42,479
(196,236
)
97,210
(179,286
)
Other expense, net(B)
(5,729
)
(6,185
)
(2,526
)
(11,914
)
(4,815
)
Income (loss) before income taxes
49,002
36,294
(198,762
)
85,296
(184,101
)
Provision (benefit) for income taxes
(F)
15,326
6,029
(40,547
)
21,355
(26,030
)
Net income (loss)
$
33,676
$
30,265
$
(158,215
)
$
63,941
$
(158,071
)
Net income (loss) per share:
Basic
$
1.36
$
1.23
$
(6.49
)
$
2.60
$
(6.50
)
Diluted
$
1.35
$
1.21
$
(6.49
)
$
2.57
$
(6.50
)
Shares used in computations:
Basic
24,708
24,542
24,389
24,625
24,326
Diluted
24,935
24,919
24,389
24,927
24,326
(A)
Stock-based compensation expense
included in operating results is summarized below (all footnote
amounts are unaudited, in thousands, except per share data):
Stock-based compensation
expense
Three Months Ended
Six Months Ended
Apr. 2, 2022
Jan. 1, 2022
Apr. 3, 2021
Apr. 2, 2022
Apr. 3, 2021
Cost of sales
$
1,971
$
1,731
$
1,989
$
3,702
$
4,261
Research & development
1,158
1,236
1,030
2,394
2,229
Selling, general &
administrative(1)
5,914
28,940
6,073
34,854
14,787
Impact on income (loss) from
operations
$
9,043
$
31,907
$
9,092
$
40,950
$
21,277
For the fiscal quarters ended
April 2, 2022, January 1, 2022 and April 3, 2021, the impact on net
income (loss), net of tax was $7,655 ($0.31 per diluted share),
$29,613 ($1.20 per diluted share) and $7,746 ($0.31 per diluted
share), respectively. For the six months ended April 2, 2022 and
April 3, 2021, the impact on net income (loss), net of tax was
$37,268 ($1.48 per diluted share) and $18,359 ($0.75 per diluted
share), respectively.
(1)
The fiscal quarter ended January
1, 2022 includes a $19.7 million stock-based compensation expense
resulting from the acceleration of vesting of restricted stock
units for certain executives.
(B)
Changes in deferred compensation
plan liabilities are included in cost of sales and operating
expenses while gains and losses on deferred compensation plan
assets are included in other income (expense), net. Deferred
compensation expense (benefit) included in operating results is
summarized below:
Deferred compensation expense
(benefit)
Three Months Ended
Six Months Ended
Apr. 2, 2022
Jan. 1, 2022
Apr. 3, 2021
Apr. 2, 2022
Apr. 3, 2021
Cost of sales
$
(28
)
$
(6
)
$
11
$
(34
)
$
22
Research & development
(306
)
(71
)
293
(377
)
588
Selling, general & administrative
(1,405
)
(415
)
1,818
(1,820
)
3,624
Impact on income (loss) from
operations
$
(1,739
)
$
(492
)
$
2,122
$
(2,231
)
$
4,234
For the fiscal quarters ended
April 2, 2022, January 1, 2022 and April 3, 2021, the impact on
other income (expense), net from gains or losses on deferred
compensation plan assets was expense of $1,604, expense of $300 and
income of $2,692, respectively. For the six months ended April 2,
2022 and April 3, 2021, the impact on other income (expense), net
from gains or losses on deferred compensation plan assets was
expense of $1,904 and income of $4,988, respectively.
(C)
Amortization of intangibles is
included in cost of sales and operating expenses as summarized
below:
Amortization of intangibles
Three Months Ended
Six Months Ended
Apr. 2, 2022
Jan. 1, 2022
Apr. 3, 2021
Apr. 2, 2022
Apr. 3, 2021
Cost of sales
$
267
$
818
$
1,855
$
1,085
$
3,872
Amortization of intangible assets
563
565
596
1,128
1,193
Impact on income (loss) from
operations
$
830
$
1,383
$
2,451
$
2,213
$
5,065
For the fiscal quarters ended
April 2, 2022, January 1, 2022 and April 3, 2021, the impact on net
income (loss), net of tax was $699 ($0.03 per diluted share),
$1,190 ($0.05 per diluted share) and $2,159 ($0.09 per diluted
share), respectively. For the six months ended April 2, 2022 and
April 3, 2021, the impact on net income (loss), net of tax was
$1,889 ($0.08 per diluted share) and $4,429 ($0.18 per diluted
share), respectively.
(D)
For the fiscal quarters ended
April 2, 2022, January 1, 2022 and April 3, 2021, the impact of
restructuring charges (gains) was a gain of $2,284 ($1,768 net of
tax ($0.07 per diluted share)), gain of $10 ($7 net of tax ($0.00
per diluted share)) and charge of $3,659 ($3,059 net of tax ($0.12
per diluted share)), respectively. For the six months ended April
2, 2022 and April 3, 2021, the impact of restructuring charges
(gains) was a gain of $2,294 ($1,775 net of tax ($0.07 per diluted
share)) and charge of $9,042 ($7,532 net of tax ($0.31 per diluted
share)), respectively.
(E)
For the fiscal quarters ended
April 2, 2022, January 1, 2022 and April 3, 2021, we incurred
merger and acquisition costs of $1,044 ($806 net of tax ($0.03 per
diluted share)), $977 ($755 net of tax ($0.03 per diluted share))
and $231,996 ($179,217 net of tax ($7.34 per diluted share)),
respectively. For the six months ended April 2, 2022 and April 3,
2021, we incurred merger and acquisition costs of $2,021 ($1,561
net of tax ($0.06 per diluted share)) and $231,996 ($179,217 net of
tax ($7.34 per diluted share)), respectively. The merger and
acquisition costs for the three and six months ended April 3, 2021
were primarily due to a termination fee paid to Lumentum Holdings
Inc. of $217,600.
(F)
The fiscal quarters ended April
2, 2022, January 1, 2022 and April 3, 2021 included non-recurring
income tax charges of $1,613 ($0.06 per diluted share), $514 ($0.02
per diluted share) and $1,854 ($0.07 per diluted share),
respectively. The fiscal quarters ended April 2, 2022, January 1,
2022 and April 3, 2021 included $184 ($0.01 per diluted share),
$4,630 ($0.19 per diluted share) and $598 ($0.02 per diluted
share), of excess tax benefits for employee stock-based
compensation, respectively. The six months ended April 2, 2022 and
April 3, 2021 included non-recurring income tax charges of $2,127
($0.09 per diluted share) and $10,468 ($0.43 per diluted share),
respectively. The six months ended April 2, 2022 and April 3, 2021
included a benefit of $4,814 ($0.19 per diluted share) and a charge
of $13 ($0.00 per diluted share) of excess tax charges (benefits)
for employee stock-based compensation, respectively.
Summarized balance sheet information is as
follows (unaudited, in thousands):
Apr. 2, 2022
Oct. 2, 2021
ASSETS
Current assets:
Cash, cash equivalents, restricted cash
and short-term investments
$
403,477
$
458,061
Accounts receivable, net
262,956
249,389
Inventories
417,275
392,241
Prepaid expenses and other assets
91,884
79,594
Total current assets
1,175,592
1,179,285
Property and equipment, net
305,916
302,613
Other assets
388,887
407,032
Total assets
$
1,870,395
$
1,888,930
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Short-term borrowings
$
9,571
$
18,395
Accounts payable
106,071
104,539
Other current liabilities
238,321
259,281
Total current liabilities
353,963
382,215
Long-term liabilities
582,238
638,530
Total stockholders’ equity
934,194
868,185
Total liabilities and stockholders’
equity
$
1,870,395
$
1,888,930
Reconciliation of GAAP to Non-GAAP net
income, net of tax (unaudited, in thousands, other than per share
data):
Three Months Ended
Six Months Ended
Apr. 2, 2022
Jan. 1, 2022
Apr. 3, 2021
Apr. 2, 2022
Apr. 3, 2021
GAAP net income (loss)
$
33,676
$
30,265
$
(158,215
)
$
63,941
$
(158,071
)
Stock-based compensation expense
7,655
29,613
7,746
37,268
18,359
Amortization of intangible assets
699
1,190
2,159
1,889
4,429
Restructuring charges (gains) and
other
(1,768
)
(7
)
3,059
(1,775
)
7,532
Non-recurring tax expense
1,613
514
1,854
2,127
10,468
Tax charge (benefit) from stock-based
compensation expense
(184
)
(4,630
)
(598
)
(4,814
)
13
Merger and acquisition costs
806
755
179,217
1,561
179,217
Non-GAAP net income
$
42,497
$
57,700
$
35,222
$
100,197
$
61,947
Non-GAAP net income per diluted share
$
1.70
$
2.32
$
1.42
$
4.02
$
2.52
Founded in 1966, Coherent, Inc. is one of the world’s leading
providers of lasers, laser-based technologies and laser-based
system solutions in a broad range of scientific, commercial and
industrial customers. Our common stock is listed on the Nasdaq
Global Select Market and is part of the Russell 1000 and Standard
& Poor’s MidCap 400 Index. For more information about Coherent,
visit the company's website at www.coherent.com for product and financial
updates.
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version on businesswire.com: https://www.businesswire.com/news/home/20220511005966/en/
Kevin Palatnik EVP & Chief Financial Officer +1 (408)
764-4110 Kevin.Palatnik@coherent.com
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