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    IVAC   US4611481080

INTEVAC, INC.

(IVAC)
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Intevac Announces Third Quarter 2021 Financial Results - Form 8-K

11/01/2021 | 03:19pm EST

Intevac Announces Third Quarter 2021 Financial Results

Santa Clara, Calif.- November 1, 2021-Intevac, Inc. (Nasdaq: IVAC) today reported financial results for the quarter and nine months ended October 2, 2021.

"We are pleased to report Q3 financial results that were above forecast, and up sequentially from the second quarter, chiefly as a result of the continued acceleration of upgrade programs by our hard disk drive (HDD) customers," commented Wendell Blonigan, president and chief executive officer. "We achieved improved operating results in the quarter, with a significant sequential increase in gross margin and continued control of expenses. In the third quarter, we completed our restructuring efforts in Thin-film Equipment (TFE) to enable reduced expense levels during this period of limited new system sales, while maintaining our ability to support the expected growth in our HDD business, and continue the technology development efforts in our TFE growth initiatives. To date in 2021, we have closely managed cash and maintained the strength of our balance sheet, achieving a net increase in total cash, restricted cash and investments since year-end 2020.

"We continue to achieve momentum in each of our businesses and expect a return to revenue growth in 2022. Our confidence in the growth ahead reflects solidifying plans by our HDD customers to expand media manufacturing capacity over the next several years, as well as the U.S. Military's continued investment in Intevac Photonics as a key technology provider for their digital night vision programs. We recently announced a new $16 million IDIQ award for Apache Helicopter night vision cameras and support, and we are the only technology provider actively working on all three of the U.S. Army's development programs focused on enhancing the night vision performance of the IVAS dismounted soldier platform." Mr. Blonigan concluded, "We believe the revenue growth ahead in both HDD and Photonics will be further bolstered by opportunities in new TFE growth markets for the Company."

($ Millions, except per share amounts)
Q3 2021 Q3 2020
GAAP Results Non-GAAP Results GAAP Results Non-GAAP Results

Net Revenues

$ 14.8 $ 14.8 $ 21.6 $ 21.6

Operating Loss

$ (4.0 ) $ (3.7 ) $ (0.1 ) $ (0.0 )

Net Loss

$ (4.2 ) $ (4.0 ) $ (0.4 ) $ (0.3 )

Net Loss per Share

$ (0.17 ) $ (0.16 ) $ (0.02 ) $ (0.01 )
Nine Months Ended
October 2, 2021
Nine Months Ended
September 26, 2020
GAAP Results Non-GAAP Results GAAP Results Non-GAAP Results

Net Revenues

$ 44.8 $ 44.8 $ 69.2 $ 69.2

Operating Income (Loss)

$ (16.8 ) $ (16.5 ) $ 0.9 $ 1.0

Net Income (Loss)

$ (16.9 ) $ (16.5 ) $ (0.1 ) $ 0.0

Net Income (Loss) per Share

$ (0.69 ) $ (0.68 ) $ (0.00 ) $ 0.00

Intevac's non-GAAP adjusted results exclude the impact, where applicable, of restructuring charges. A reconciliation of the GAAP and non-GAAP adjusted results is provided in the financial table included in this release. See also "Use of Non-GAAP Financial Measures" section.

Third Quarter 2021 Summary

The net loss for the quarter was $4.2 million, or $0.17 per diluted share, compared to a net loss of $357,000, or $0.02 per diluted share, in the third quarter of 2020. The non-GAAP net loss was $4.0 million, or $0.16 per diluted share, compared to a non-GAAP net loss of $254,000, or $0.01 per diluted share, for the third quarter of 2020.

Revenues were $14.8 million, including $8.0 million of TFE revenues and $6.8 million of Photonics revenues. TFE revenues consisted of upgrades, spares and service. Photonics revenues included $3.1 million of research and development contracts and $3.7 million of product sales. In the third quarter of 2020, revenues were $21.6 million, of which $9.4 million in TFE revenues consisted of upgrades, spares and service, and $12.2 million in Photonics revenues consisted of $6.5 million of research and development contracts and $5.7 million of product sales.

TFE gross margin was 41.9% compared to 43.5% in the third quarter of 2020 and 18.7% in the second quarter of 2021. The improvement compared to the second quarter of 2021 reflected higher revenues and more favorable product mix. Photonics gross margin was 32.0% compared to 42.8% in the third quarter of 2020 and 24.9% in the second quarter of 2021. The improvement compared to the second quarter of 2021 reflected higher margins on product sales. Consolidated gross margin was 37.4%, compared to 43.1% in the third quarter of 2020 and 22.5% in the second quarter of 2021.

R&D and SG&A expenses were $9.5 million, compared to $9.4 million in the third quarter of 2020 and $9.4 million in the second quarter of 2021.

Order backlog totaled $44.9 million on October 2, 2021, compared to $51.7 million on July 3, 2021 and $63.3 million on September 26, 2020. Backlog at October 2, 2021, July 3, 2021 and September 26, 2020 did not include any 200 Lean HDD systems.

The Company ended the quarter with $51.4 million of total cash, restricted cash and investments and $89.6 million in tangible book value.

First Nine Months 2021 Summary

The net loss was $16.9 million, or $0.69 per diluted share, compared to a net loss of $57,000, or $0.00 per diluted share, for the first nine months of 2020. The non-GAAP net loss was $16.5 million or $0.68 per diluted share, compared to non-GAAP net income of $46,000 or $0.00 per diluted share, for the first nine months of 2020.

Revenues were $44.8 million, including $22.6 million of TFE revenues and $22.2 million of Photonics revenues, compared to revenues of $69.2 million, which included $33.9 million of TFE revenues and $35.3 million of Photonics revenues, for the first nine months of 2020.

TFE gross margin was 28.7%, compared to 40.2% in the first nine months of 2020, primarily due to lower revenues which affected factory utilization. Photonics gross margin was 23.4% compared to 43.2% in the first nine months of 2020 due to lower revenue levels, as well as higher costs related to completing the integration of our camera into the IVAS platform. Consolidated gross margin was 26.1%, compared to 41.7% in the first nine months of 2020.

R&D and SG&A expenses were $28.5 million compared to $28.0 million in the first nine months of 2020.

Use of Non-GAAP Financial Measures

Intevac's non-GAAP results exclude the impact, where applicable, of restructuring charges. A reconciliation of the GAAP and non-GAAP results is provided in the financial tables included in this release.

Management uses non-GAAP results to evaluate the Company's operating and financial performance in light of business objectives and for planning purposes. These measures are not in accordance with GAAP and may differ from non-GAAP methods of accounting and reporting used by other companies. Intevac believes these measures enhance investors' ability to review the Company's business from the same perspective as the Company's management and facilitate comparisons of this period's results with prior periods. The presentation of this additional information should not be considered a substitute for results prepared in accordance with GAAP.

Conference Call Information

The Company will discuss its financial results and outlook in a conference call today at 1:30 p.m. PDT (4:30 p.m. EDT). To participate in the teleconference, please call toll-free (877) 407-0989 prior to the start time, and reference meeting number 13723665. For international callers, the dial-in number is +1 (201) 389-0921. A live and archived webcast of the call will also be available on the Company's investor relations website at https://ir.intevac.com: https://www.webcast-eqs.com/intevac11012021/en .

About Intevac

Intevac was founded in 1991 and has two businesses: Thin-film Equipment and Photonics.

In our Thin-film Equipment business, we are a leader in the design and development of high-productivity, thin-film processing systems. Our production-proven platforms are designed for high-volume manufacturing of substrates with precise thin film properties, such as the hard drive media, display cover panel, solar photovoltaic, and advanced semiconductor packaging markets we serve currently.

In our Photonics business, we are a recognized leading developer of advanced high-sensitivity digital sensors, cameras and systems that primarily serve the defense industry. We are the provider of integrated digital imaging systems for most U.S. military night vision programs.

For more information call 408-986-9888, or visit the Company's website at www.intevac.com.

200 Lean®,INTEVAC MATRIX®, INTEVAC VERTEX®, ENERGi®,VERTEX Marathon®, and VERTEX Spectra®are registered trademarks of Intevac, Inc.

Safe Harbor Statement

This press release includes statements that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Reform Act"). Intevac claims the protection of the safe-harbor for forward-looking statements contained in the Reform Act. These forward-looking statements are often characterized by the terms "may," "believes," "projects," "expects," or "anticipates," and do not reflect historical facts. Specific forward-looking statements contained in this press release include, but are not limited to: impacts related to the COVID-19 global pandemic, customer adoption of our products, future revenue growth potential, and the future financial performance of Intevac. The forward-looking statements contained herein involve risks and uncertainties that could cause actual results to differ materially from the Company's expectations. These risks include, but are not limited to: global economic impacts of COVID-19 including delays in customer evaluations, supply chain constraints and disruptions related to COVID-19, technology risk, challenges achieving customer adoption and revenue growth in Thin-film Equipment markets, and delays in Photonics programs, each of which could have a material impact on our business, our financial results, and the Company's stock price. These risks and other factors are detailed in the Company's periodic filings with the U.S. Securities and Exchange Commission.

INTEVAC, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except per share amounts)

Three months ended Nine months ended
October 2,
2021
September 26,
2020
October 2,
2021
September 26,
2020

Net revenues

TFE

$ 7,998 $ 9,367 $ 22,605 $ 33,925

Photonics

6,795 12,198 22,242 35,323

Total net revenues

14,793 21,565 44,847 69,248

Gross profit

5,527 9,300 11,689 28,876

Gross margin

TFE

41.9 % 43.5 % 28.7 % 40.2 %

Photonics

32.0 % 42.8 % 23.4 % 43.2 %

Consolidated

37.4 % 43.1 % 26.1 % 41.7 %

Operating expenses

Research and development

3,743 3,603 11,262 10,594

Selling, general and administrative

5,752 5,845 17,208 17,426

Total operating expenses

9,495 9,448 28,470 28,020

Total operating income (loss)

(3,968 ) (148 ) (16,781 ) 856

Operating income (loss)

TFE

(1,841 ) (1,661 ) (10,148 ) (4,366 )

Photonics

(341 ) 3,032 (1,742 ) 9,480

Corporate

(1,786 ) (1,519 ) (4,891 ) (4,258 )

Total operating income (loss)

(3,968 ) (148 ) (16,781 ) 856

Interest income and other income (expense), net

25 8 75 212

Net income (loss) before provision for income taxes

(3,943 ) (140 ) (16,706 ) 1,068

Provision for income taxes

290 217 157 1,125

Net loss

$ (4,233 ) $ (357 ) $ (16,863 ) $ (57 )

Net loss per share

Basic and Diluted

$ (0.17 ) $ (0.02 ) $ (0.69 ) $ (0.00 )

Weighted average common shares outstanding

Basic and Diluted

24,522 23,771 24,265 23,605

INTEVAC, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

October 2,
2021
January 2,
2021
(Unaudited) (see Note)

ASSETS

Current assets

Cash, cash equivalents and short-term investments

$ 44,833 $ 44,180

Accounts receivable, net

13,470 28,646

Inventories

22,453 21,689

Prepaid expenses and other current assets

1,981 1,893

Total current assets

82,737 96,408

Long-term investments

5,825 5,388

Restricted cash

786 787

Property, plant and equipment, net

9,209 11,004

Operating lease right-of-use assets

6,382 8,165

Deferred income tax and other long-term assets

5,554 5,486

Total assets

$ 110,493 $ 127,238

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Current operating lease liabilities

$ 3,047 $ 2,853

Accounts payable

4,659 4,259

Accrued payroll and related liabilities

5,657 7,679

Other accrued liabilities

2,649 3,631

Total current liabilities

16,012 18,422

Non-current liabilities

Non-current operating lease liabilities

4,476 6,803

Other long-term liabilities

450 457

Total non-current liabilities

4,926 7,260

Stockholders' equity

Common stock ($0.001 par value)

25 24

Additional paid-in capital

198,117 193,173

Treasury stock, at cost

(29,551 ) (29,551 )

Accumulated other comprehensive income

557 640

Accumulated deficit

(79,593 ) (62,730 )

Total stockholders' equity

89,555 101,556

Total liabilities and stockholders' equity

$ 110,493 $ 127,238

Note: Amounts as of January 2, 2021 are derived from the January 2, 2021 audited consolidated financial statements.

INTEVAC, INC.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(Unaudited, in thousands, except per share amounts)

Three months ended Nine months ended
October 2,
2021
September 26,
2020
October 2,
2021
September 26,
2020

Non-GAAP Income (Loss) from Operations

Reported operating income (loss) (GAAP basis)

$ (3,968 ) $ (148 ) $ (16,781 ) $ 856

Restructuring charges1

276 103 319 103

Non-GAAP Operating Income (Loss)

$ (3,692 ) $ (45 ) $ (16,462 ) $ 959

Non-GAAP Net Income (Loss)

Reported net loss (GAAP basis)

$ (4,233 ) $ (357 ) $ (16,863 ) $ (57 )

Restructuring charges1

276 103 319 103

Income tax effect of non-GAAP adjustments2

- - - -

Non-GAAP Net Income (Loss)

$ (3,957 ) $ (254 ) $ (16,544 ) $ 46

Non-GAAP Net Income (Loss) Per Diluted Share

Reported net loss per diluted share (GAAP basis)

$ (0.17 ) $ (0.02 ) $ (0.69 ) $ (0.00 )

Restructuring charges1

$ 0.01 $ 0.00 $ 0.01 $ 0.00

Non-GAAP Net Income (Loss) Per Diluted Share

$ (0.16 ) $ (0.01 ) $ (0.68 ) $ 0.00

Weighted average number of basic shares

24,522 23,771 24,265 23,605

Weighted average number of diluted shares

24,522 23,771 24,265 24,049
1

Results for all periods presented include severance and other employee-related costs related to a restructuring program.

2

The amount represents the estimated income tax effect of the non-GAAP adjustments. The Company calculated the tax effect of non-GAAP adjustments by applying an applicable estimated jurisdictional tax rate to each specific non-GAAP item.

Disclaimer

Intevac Inc. published this content on 01 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 November 2021 20:17:02 UTC.


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Sales 2021 65,1 M - -
Net income 2021 -18,7 M - -
Net Debt 2021 - - -
P/E ratio 2021 -6,88x
Yield 2021 -
Capitalization 130 M 130 M -
Capi. / Sales 2021 2,00x
Capi. / Sales 2022 1,27x
Nbr of Employees 266
Free-Float -
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Number of Analysts 1
Last Close Price 5,30 $
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Nigel Hunton President, Chief Executive Officer & Director
James P. Moniz Chief Financial Officer, Secretary & Treasurer
David S. Dury Chairman
Terry Bluck Vice President & CTO-Thin Film Equipment
Verle Aebi Chief Technology Officer-Photonics
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