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ACM Research Reports First Quarter 2019 Results
ACM’s President and Chief Executive Officer Dr.
Dr. Wang continued, “As we look ahead to the remainder of 2019, we are excited by our business prospects and are committed to continuing to gain market share with new products, new customers, and more production steps. We are executing our strategy, and remain focused on achieving our vision of becoming a major player in the semiconductor equipment market.”
- Shipments. Total shipments in the first quarter of 2019 were
$14 million, versus $10 millionin the first quarter of 2018. Shipments include deliveries for revenue in the quarter and deliveries of systems awaiting customer acceptance for potential revenue in future quarters.
- Ultra-C Tahoe. ACM delivered its first Ultra-C Tahoe evaluation tool to an important strategic customer in January of 2019. Evaluation of this first tool is on schedule. The Ultra-C Tahoe tool incorporates innovative and patented technology to deliver high cleaning performance, but uses 10% or less of the sulfuric acid typically consumed by conventional high temperature single wafer cleaning tools.
- New Product Introduction. ACM introduced two electro-plating products at SEMICON China in March of 2019 - Ultra ECP AP and Ultra ECP MAP. Ultra ECP AP is a back-end assembly tool used for bumping, or applying copper, tin and nickel to wafers at the die level before packaging. Ultra ECP MAP is used in front-end wafer fabrication processes and designed to deliver world-class electrochemical copper plating for advanced copper interconnect applications. Both ECP tools offer significant performance advantages relative to available competitive products, including greater performance, increased flexibility, and improved cycle times.
|Three Months Ended March 31,|
|(dollars in thousands, except per share data)|
|Income from operations(2)||$||2,251||$||(1,904||)||$||2,995||$||271|
|Net income attributable to ACM Research, Inc.(2)||$||1,857||$||(2,780||)||$||2,601||$||(605||)|
|(1)||Reconciliations to U.S. generally accepted accounting principles (“GAAP”) financial measures from non-GAAP financial measures are presented below under “Reconciliation of GAAP to Non-GAAP Financial Measures.”|
|(2)||Non-GAAP financial measures exclude stock-based compensation.|
The following figures refer to the first quarter of 2019, unless noted otherwise. All comparisons are with the first quarter of 2018, unless otherwise noted.
- Revenue increased 110% to
$20.5 million, due to an increased volume of tools shipped for revenue and higher prices associated with these tools. Revenue for the first quarter included repeat shipments, and several customer acceptances of tools shipped in previous quarters.
- Gross margin was 43.1%, compared to 52.6% in the first quarter of 2018. Gross margin was within the range of 40.0% to 45.0% set forth in the Company’s long-term business model. Gross margin in the year-ago period was elevated due to a concentrated mix of higher-margin SAPS-II tools. The Company expects gross margin to continue to vary from period to period due to a variety of factors, such as sales volume and product mix.
- Operating expenses were
$6.6 million, a decrease of 6%. Non-GAAP operating expenses, which remove stock-based compensation, were $5.9 million, up 21%. Non-GAAP operating expenses as a percent of revenue decreased to 29%, compared to 50% in the first quarter of 2018.
- Net income was
$1.9 million, compared to a net loss of $2.8 millionin the first quarter of 2018. Non-GAAP net income was $2.6 million, compared to a non-GAAP net loss of $0.6 millionin the first quarter of 2018.
- Net income per diluted share was
$0.10, versus a net loss of $0.18in the first quarter of 2018. Non-GAAP net income per diluted share was $0.14, versus a net loss of $0.04in the first quarter of 2018.
- Cash and equivalents at quarter-end were
$27.4 million, up from $27.1 millionat the end of the fourth quarter of 2018 and $15.2 millionat the end of the first quarter of 2018.
For fiscal year 2019, the Company continues to expect revenue to be approximately
Conference Call Details
A conference call to discuss results will be held on
|Phone Number||Toll-Free Number|
|United States||+1 (845) 675-0437||+1 (866) 519-4004|
|Hong Kong||+852 3018 6771||+852 8009 06601|
|Mainland China||+86 (800) 819 0121|
|+86 (400) 620 8038|
|Other International||+65 6713 5090|
A recording of the webcast will be available on the investor page of the ACM website at www.acmrcsh.com for one week following the call.
Use of Non-GAAP Financial Measures
ACM presents non-GAAP gross margin, operating income, net income (loss), and basic and diluted earnings per share as supplemental measures to GAAP financial measures regarding ACM’s operational performance. These supplemental measures exclude the impact of stock-based compensation, which ACM does not believe is indicative of its core operating results. A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure is provided below under “Reconciliation of Non-GAAP to GAAP Financial Measures.”
ACM believes these non-GAAP financial measures are useful to investors in assessing its operating performance. ACM uses these financial measures internally to evaluate its operating performance and for planning and forecasting of future periods. Financial analysts may focus on and publish both historical results and future projections based on the non-GAAP financial measures. ACM also believes it is in the best interests of investors for ACM to provide this non-GAAP information.
While ACM believes these non-GAAP financial measures provide useful supplemental information to investors, there are limitations associated with the use of these non-GAAP financial measures. These non-GAAP financial measures may not be reported by competitors, and they may not be directly comparable to similarly titled measures of other companies due to differences in calculation methodologies. The non-GAAP financial measures are not an alternative to GAAP information and are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures. They should be used only as a supplement to GAAP information and should be considered only in conjunction with ACM’s consolidated financial statements prepared in accordance with GAAP.
Information presented in the second and third paragraphs of this press release and under the heading “Outlook” above contains forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may vary significantly from ACM’s expectations based on a number of risks and uncertainties, including but not limited to the following: anticipated customer orders or identified market opportunities may not grow or develop as anticipated; customer orders already received may be postponed or canceled; suppliers may not be able to meet ACM’s demands on a timely basis; volatile global economic, market, industry and other conditions could result in sharply lower demand for products containing semiconductors and for the company's products and in disruption of capital and credit markets; ACM’s failure to successfully manage its operations; and trade regulations, currency fluctuations, political instability and war may materially adversely affect ACM due to its substantial non-U.S. customer and supplier base and its substantial non-U.S. manufacturing operations. ACM cannot guarantee any future results, levels of activity, performance or achievements. ACM expressly disclaims any obligation to update forward-looking statements after the date of this press release.
ACM develops, manufactures and sells single-wafer wet cleaning equipment, which semiconductor manufacturers can use in numerous manufacturing steps to remove particles, contaminants and other random defects, and thereby improve product yield, in fabricating advanced integrated circuits.
For investor and media inquiries, please contact:
|In the United States:||The Blueshirt Group|
|+1 (415) 489-2195|
|In China:||The Blueshirt Group Asia|
|Gary Dvorchak, CFA|
|+86 (138) 1079-1480|
|ACM Research, Inc.|
|Condensed Consolidated Balance Sheets|
|March 31, 2019||December 31, 2018|
|(in thousands, except share and per share data)|
|Cash and cash equivalents||$27,367||$27,124|
|Accounts receivable, less allowance for doubtful accounts of $0 as of March 31, 2019 and $0 as of December 31, 2018||25,070||24,608|
|Total current assets||99,505||96,028|
|Property, plant and equipment, net||3,719||3,708|
|Operating lease right-of-use assets, net||4,787||-|
|Intangible assets, net||263||274|
|Deferred tax assets||1,669||1,637|
|Investment in affiliates, equity method||1,476||1,360|
|Other long-term assets||-||40|
|Liabilities and Stockholders’ Equity|
|Advances from customers||8,469||8,417|
|Income taxes payable||1,228||1,193|
|Other payables and accrued expenses||11,834||10,410|
|Current portion of operating lease liability||1,326||-|
|Total current liabilities||49,019||46,140|
|Long-term operating lease liability||3,462||-|
|Other long-term liabilities||3,296||4,583|
|Commitments and contingencies|
|Common stock – Class A, par value $0.0001: 100,000,000 shares authorized as of March 31, 2019 and December 31, 2018; 14,176,690 shares issued and outstanding as of March 31, 2019 and 14,110,315 shares issued and outstanding as of December 31, 2018||1||1|
|Common stock–Class B, par value $0.0001: 7,303,533 shares authorized as of March 31, 2019 and December 31, 2018; 1,898,423 shares issued and outstanding as of March 31, 2019 and 1,898,423 shares issued and outstanding as of December 31, 2018||-||-|
|Additional paid in capital||57,371||56,567|
|Accumulated other comprehensive loss||(200)||(857)|
|Total stockholders’ equity||55,642||52,324|
|Total liabilities and stockholders’ equity||$111,419||$103,047|
|ACM RESEARCH, INC.|
|Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)|
|Three Months Ended March 31,|
|( In thousands, except share and per share data)|
|Cost of revenue||11,653||4,621|
|Sales and marketing||1,869||1,855|
|Research and development||2,765||1,541|
|General and administrative||1,941||3,630|
|Total operating expenses, net||6,575||7,026|
|Income (loss) from operations||2,251||(1,904)|
|Other expense, net||(261)||(755)|
|Equity income in net income of affiliates||116||1|
|Income (loss) before income taxes||1,976||(2,758)|
|Income tax expense||(119)||(22)|
|Net income (loss)||$||1,857||$||(2,780)|
|Comprehensive income (loss):|
|Net income (loss)||1,857||(2,780)|
|Foreign currency translation adjustment||657||705|
|Total comprehensive income (loss)||$||2,514||$||(2,075)|
|Net income (loss) per common share :|
|Weighted average common shares outstanding used in computing per share amounts:|
Reconciliation of GAAP to Non-GAAP Financial Measures
As described under “Use of Non-GAAP Financial Measures” above, ACM presents non-GAAP gross margin, operating income and net income (loss) as supplemental measures to GAAP financial measures, each of which excludes stock-based compensation (“SBC”) from the equivalent GAAP financial line items. The following table reconciles gross margin, operating income and net income (loss) to the related non-GAAP financial measures:
|Three Months Ended March 31,
|Cost of revenue||(11,653)||(30)||(11,623)||(4,621)||(8)||(4,613)|
|Sales and marketing||(1,869)||(34)||(1,835)||(1,855)||(34)||(1,821)|
|Research and development||(2,765)||(86)||(2,679)||(1,541)||(27)||(1,514)|
|General and administrative||(1,941)||(594)||(1,347)||(3,630)||(2,106)||(1,524)|
|Income (Loss) from operations||$||2,251||$||(744)||$||2,995||$||(1,904)||$||(2,175)||$||271|
|Net income (loss)||$||1,857||$||(744)||$||2,601||$||(2,780)||$||(2,175)||$||(605)|
Source: ACM Research (Shanghai), Inc.