- Record Annual Revenue of $144.0 million
- Record Quarterly Revenue of $40.4 million
- Record Annual Income from Operations of $17.9 million
- Record Quarterly Income from Operations of $6.5 million
- Record Quarterly Bookings of $48.7 million
Cascade Microtech, Inc. (
Cascade Microtech also announced today that it has entered into a merger agreement with FormFactor, Inc. (
Financial Summary
Results for the quarter ended December 31, 2015 were as follows:
- Total revenue of $40.4 million, compared to $35.8 million for Q3 2015 and $36.6 million for Q4 2014.
- Systems revenue of $21.7 million, an increase of $2.5 million, or 13.3%, over Q3 2015, and an increase of $0.3 million, or 1.5%, from Q4 2014.
- Probes revenue of $18.7 million, an increase of $2.1 million, or 12.5%, over Q3 2015, and an increase of $3.5 million, or 22.9%, over Q4 2014.
- Q4 2015 represents record revenue overall and for our Probes segment.
- Gross margin of 56.3%, down from 56.7% in Q3 2015 and up from 53.4% in Q4 2014.
- Systems gross margin of 49.8%, down from 50.3% in Q3 2015 and up from 48.1% in Q4 2014.
- Probes gross margin of 63.9%, consistent with 63.9% in Q3 2015 and up from 60.8% in Q4 2014.
- Income from operations of $6.5 million, an increase of $2.0 million, or 44.9%, over Q3 2015, and an increase of $2.4 million, or 58.0%, over Q4 2014.
- Q4 2015 sets a new record for income from operations.
- GAAP net income of $4.2 million, or $0.25 per diluted share, compared to $3.2 million, or $0.19 per diluted share, for Q3 2015, and $4.3 million, or $0.25 per diluted share, for Q4 2014.
- Q4 2015 includes income tax expense of $2.1 million, compared to an expense of $1.3 million for Q3 2015, and a benefit of $0.4 million for Q4 2014.
- Non-GAAP net income of $4.5 million, or $0.28 per diluted share, compared to $3.4 million, or $0.20 per diluted share, for Q3 2015, and $4.4 million, or $0.26 per diluted share, for Q4 2014.
- Q4 2015 sets a new record for non-GAAP earnings per share.
- Depreciation, amortization and stock-based compensation expenses totaled $2.3 million, compared to $2.2 million for Q3 2015, and $2.1 million for Q4 2014.
- Adjusted EBITDAS of $8.8 million, compared to $6.7 million for Q3 2015, and $7.5 million for Q3 2015.
- Q4 2015 sets a new record for adjusted EBITDAS.
- Book-to-bill ratio of 1.21 to 1.
Results for the year ended December 31, 2015 were as follows:
- Total revenue of $144.0 million, compared to $136.0 million for 2014.
- Systems revenue of $77.9 million, a decrease of $5.0 million, or 6.0%, from 2014.
- Probes revenue of $66.1 million, an increase of $13.0 million, or 24.4%, over 2014.
- 2015 represents record revenue overall and for our Probes segment.
- Gross margin of 55.6%, up from 51.7% in 2014.
- 2015 sets a new record for gross margin.
- Income from operations of $17.9 million, an increase of $4.6 million, or 34.7%, over 2014.
- 2015 sets a new record for income from operations.
- GAAP net income of $12.4 million, or $0.73 per diluted share, compared to $9.9 million, or $0.59 per diluted share, for 2014.
- 2015 includes income tax expense of $5.5 million, compared to an expense of $2.7 million for 2014.
- Non-GAAP net income of $13.8 million, or $0.81 per diluted share, compared to $11.2 million, or $0.67 per diluted share, for 2014.
- Depreciation, amortization and stock-based compensation expenses of $8.4 million, compared to $8.8 million for 2014.
- Adjusted EBITDAS of $26.5 million, compared to $22.8 million for 2014.
- Annual book-to-bill ratio of 1.04 to 1.
"Cascade Microtech set quarterly records for production probe and analytical probe card revenue, overall revenue, income from operations, adjusted EBITDAS, and bookings. As a percentage of revenue, in the fourth quarter we improved our adjusted EBITDAS to 21.8% which compares favorably to our stated success model target of 22%. This achievement reflects our customers growing demand for Cascade products and services as well as the leverage of our financial model. This financial performance was achieved as we increased our investments in R&D for new product development," said Michael Burger, President and CEO. "On an annual basis, records were set for probes segment revenue, overall revenue, gross margins, income from operations, adjusted EBITDAS and non-GAAP EPS. With a very strong close to 2015 together with record backlog, we expect to financially outperform our 2015 results and grow faster than the markets we serve in 2016."
Financial Outlook
For the first quarter of 2016 we are projecting revenue in the range of $33.0 million to $37.0 million, with diluted GAAP earnings per share in the range of $0.08 to $0.14, and non-GAAP earnings per share in the range of $0.10 to $0.16. Our guidance assumes a tax rate of 32%, consistent foreign currency exchange rates and no significant one-time charges.
The companies will hold a joint conference call today at 8:30 a.m. Eastern (5:30 a.m. Pacific) to discuss this announcement. The conference call can be joined by dialing 877-331-4217, Conference ID 42589273, within the U.S. and 224-633-1404, Conference ID 42589273, for all other locations. To access the webcast, visit the Investors section of Cascade Microtech's web site at www.cascademicrotech.com/investors to view the details. A webcast replay will be available on the Cascade Microtech web site approximately three hours after the conference call concludes.
CASCADE MICROTECH, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
Three Months Ended
-----------------------------
December September December Year Ended December
31, 30, 31, 31,
-------------------
2015 2015 2014 2015 2014
--------- --------- --------- --------- ---------
Revenue $ 40,411 $ 35,781 $ 36,593 $ 143,978 $ 136,022
Cost of sales 17,640 15,511 17,058 63,892 65,708
--------- --------- --------- --------- ---------
Gross profit 22,771 20,270 19,535 80,086 70,314
56.3% 56.7% 53.4% 55.6% 51.7%
Operating expenses:
Research and development 4,757 4,344 3,598 16,965 13,821
Selling, general and
administrative 11,474 11,414 11,797 45,230 43,209
--------- --------- --------- --------- ---------
16,231 15,758 15,395 62,195 57,030
--------- --------- --------- --------- ---------
Income from operations 6,540 4,512 4,140 17,891 13,284
Other income (expense):
Interest income, net 7 14 4 15 29
Other, net (293) (19) (289) (16) (649)
--------- --------- --------- --------- ---------
(286) (5) (285) (1) (620)
--------- --------- --------- --------- ---------
Income before income
taxes 6,254 4,507 3,855 17,890 12,664
Income tax expense 2,093 1,288 (448) 5,540 2,734
--------- --------- --------- --------- ---------
Net income $ 4,161 $ 3,219 $ 4,303 $ 12,350 $ 9,930
========= ========= ========= ========= =========
Net income per share:
Basic $ 0.26 $ 0.19 $ 0.26 $ 0.75 $ 0.61
Diluted $ 0.25 $ 0.19 $ 0.25 $ 0.73 $ 0.59
Shares used in computing
net income per share:
Basic 15,933 16,529 16,435 16,396 16,323
Diluted 16,517 17,112 16,955 16,957 16,828
CASCADE MICROTECH, INC.
AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
December 31, December 31,
Assets 2015 2014
------------------------------------------ --------------- ---------------
Current assets:
Cash and cash equivalents $ 32,107 $ 38,107
Marketable securities 3,658 1,626
Restricted cash 10 61
Accounts receivable, net 27,716 20,763
Inventories 23,229 24,642
Prepaid expenses and other 6,597 4,454
--------------- ---------------
Total current assets 93,317 89,653
Fixed assets, net 12,256 8,100
Goodwill 11,592 12,823
Purchased intangible assets, net 9,143 12,572
Deferred income taxes 5,326 6,884
Other assets 677 944
--------------- ---------------
$ 132,311 $ 130,976
=============== ===============
Liabilities and Stockholders' Equity
------------------------------------------
Current liabilities:
Accounts payable 8,834 7,505
Deferred revenue 1,617 2,070
Accrued liabilities 8,488 9,505
--------------- ---------------
Total current liabilities 18,939 19,080
Deferred revenue 555 329
Deferred income taxes 1,840 2,595
Other long-term liabilities 1,581 1,511
--------------- ---------------
Total liabilities 22,915 23,515
--------------- ---------------
Stockholders' equity:
Common stock 103,354 111,645
Accumulated other comprehensive loss (5,251) (3,127)
Retained earnings (accumulated deficit) 11,293 (1,057)
--------------- ---------------
Total stockholders' equity 109,396 107,461
--------------- ---------------
$ 132,311 $ 130,976
=============== ===============
CASCADE MICROTECH, INC.
AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, except per share amounts)
(unaudited)
Three Months Ended
-----------------------------
December September December Year Ended December
31, 30, 31, 31,
-------------------
Non-GAAP Net Income 2015 2015 2014 2015 2014
------------------------- --------- --------- --------- --------- ---------
GAAP net income $ 4,161 $ 3,219 $ 4,303 $ 12,350 $ 9,930
Adjustments to net
income:
Restructuring - - 1,178 262 1,236
Acquisition and
acquisition related - - - - (557)
Amortization of
intangibles 582 593 694 2,458 3,011
Income tax effect of
non-GAAP adjustments (195) (196) (509) (894) (1,170)
Discrete tax items - (204) (1,246) (358) (1,246)
--------- --------- --------- --------- ---------
Non-GAAP net income $ 4,548 $ 3,412 $ 4,420 $ 13,818 $ 11,204
========= ========= ========= ========= =========
GAAP net income per
diluted share $ 0.25 $ 0.19 $ 0.25 $ 0.73 $ 0.59
========= ========= ========= ========= =========
Non-GAAP net income per
diluted share $ 0.28 $ 0.20 $ 0.26 $ 0.81 $ 0.67
========= ========= ========= ========= =========
Shares used in diluted
share calculations 16,517 17,112 16,955 16,957 16,828
Three Months Ended
-----------------------------
December September December Year Ended December
31, 30, 31, 31,
-------------------
EBITDAS and Adjusted
EBITDAS 2015 2015 2014 2015 2014
------------------------- --------- --------- --------- --------- ---------
GAAP Income from
operations $ 6,540 $ 4,512 $ 4,140 $ 17,891 $ 13,284
Adjustments:
Depreciation 852 785 883 3,109 3,335
Amortization of
intangibles 582 593 694 2,458 3,011
Stock-based compensation 816 805 564 2,825 2,482
--------- --------- --------- --------- ---------
EBITDAS 8,790 6,695 6,281 26,283 22,112
Adjustments:
Restructuring - - 1,178 262 1,236
Acquisition and
acquisition related - - - - (557)
--------- --------- --------- --------- ---------
Adjusted EBITDAS $ 8,790 $ 6,695 $ 7,459 $ 26,545 $ 22,791
========= ========= ========= ========= =========
Three Months Ending March 31,
2016
-----------------------------
High
Low Range Range
Guidance Guidance
--------- ---------
Forward-looking non-GAAP
net income
-------------------------
GAAP net income $ 1,300 $ 2,300
Adjustments:
Amortization of
intangibles 582 582
Income tax effect of
non-GAAP adjustments (186) (186)
--------- ---------
Non-GAAP net income $ 1,696 $ 2,696
========= =========
GAAP net income per
diluted share $ 0.08 $ 0.14
========= =========
Non-GAAP net income per
diluted share $ 0.10 $ 0.16
========= =========
Shares used in diluted
share calculations 16,700 16,700
Forward-Looking Statements
The statements in this release regarding attainment of our success model, our continued financial improvement, our expectations relating to investment in new product development and positioning for continued success in 2016 and statements under "Financial Outlook" regarding projected revenue, GAAP earnings per share, and non-GAAP earnings per share and assumptions supporting those projections, and other statements identified by terminology such as "will," "should," "expects," "estimates," "predicts," and "continue" or other derivations of these or other comparable terms are "forward-looking" statements within the meaning of the Securities Litigation Reform act of 1995. Such statements are based on current expectations, estimates and projections about the Company's business based in part on assumptions made by management. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including: changes in demand for the Company's products; changes in product mix; potential delays and other factors affecting the timing of new product introductions; the timing of shipments and customer orders; constraints on supplies of components; excess or shortage of production capacity; potential failure of expected market opportunities to materialize; changes in foreign exchange rates; our ability or delay in integrating acquired businesses; and other risks discussed from time to time in the Company's Securities and Exchange Commission filings and reports, including the Company's Annual Report on Form 10-K for the year ended December 31, 2014. In addition, such statements could be affected by general industry and market conditions and growth rates and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
Non-GAAP Financial Measures
In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles (GAAP), the Company's earnings release contains Non-GAAP financial measures, which are defined below and reconciled to GAAP financial measures in a table later in this release:
- Non-GAAP net income is defined as GAAP net income before certain items (adjustments) such as restructuring, facility move and project costs, acquisition-related expenses, the amortization of intangibles and discrete tax items that we believe are either not representative of our ongoing operating performance or effect the comparability of results over time. Non-GAAP net income should not be construed as a substitute for net income as defined by GAAP. However, we regard non-GAAP net income as a complement to GAAP net income in assessing our financial performance over time and in the future.
- Adjusted EBITDAS is defined as income from continuing operations before depreciation and amortization and stock-based compensation and certain other items (adjustments) such as restructuring, facility move and project costs, and acquisition-related expenses that we believe are not representative of our ongoing operating performance. Adjusted EBITDAS should not be construed as a substitute for net income from continuing operations or net cash provided by (used in) operating activities (all as determined in accordance with GAAP) for the purpose of analyzing our operating performance, financial position and cash flows, as adjusted EBITDAS is not defined by GAAP. However, we regard adjusted EBITDAS as a complement to net income from continuing operations and other GAAP financial performance measures, by including an indirect measure of operating cash flow.
About Cascade Microtech, Inc.
Cascade Microtech, Inc. (
FOR MORE INFORMATION, CONTACT: Jeff A. Killian Cascade Microtech, Inc. (503) 601-1280