2017 third quarter highlights
· Revenues of $245.7 million
· Gross margin of 48.0%
· GAAP EPS of $0.75 (diluted); non-GAAP EPS of $0.91 (diluted)
2017 fourth quarter guidance
· Revenue range: $245 million to $255 million
· Gross margin of approximately 48.0% based on current expectations of product mix
ORBOTECH LTD. (NASDAQ: ORBK) (the "Company") today announced its consolidated financial results for the third quarter of 2017.
Commenting on the results, Asher Levy, Chief Executive Officer, said: "Our very strong third quarter financial performance reflects robust execution of our business plans, the wide acceptance of our new solutions and continued transformation of our technological innovation into improved revenues and profits. Each of our three divisions performed well and we are experiencing favorable business momentum across the board. These favorable industry conditions, in conjunction with our technological leadership, create new opportunities for Orbotech in areas such as advanced smartphones, automotive and flat panel displays, where our solutions enable the most advanced manufacturing technologies and, in turn, increase our total addressable market."
Revenues for the third quarter of 2017 totaled $245.7 million, compared with $205.0 million in the third quarter of 2016, and $210.7 million in the second quarter of 2017.
In the Company's Production Solutions for Electronics Industry segment:
· Revenues from the Company's printed circuit board ("PCB") business were $85.7 million (including $52.6 million in equipment sales) in the third quarter of 2017. This compares to PCB revenues of $69.0 million (including $38.0 million in equipment sales) in the third quarter of 2016.
· Revenues from the Company's flat panel display ("FPD") business were $76.0 million (including $64.5 million in equipment sales) in the third quarter of 2017. This compares to FPD revenues of $59.8 million (including $49.4 million in equipment sales) in the third quarter of 2016.
· Revenues from the Company's semiconductor device ("SD") business were $78.5 million (including $65.9 million in equipment sales) in the third quarter of 2017. This compares to SD revenues of $71.5 million (including $57.4 million in equipment sales) in the third quarter of 2016.
Revenues in the Company's other segments totaled $5.4 million in the third quarter of 2017, compared with $4.6 million in the third quarter of 2016.
Service revenues for the third quarter of 2017 were $59.2 million, compared with $58.0 million in the third quarter of 2016.
Gross profit and gross margin in the third quarter of 2017 were $118.0 million and 48.0%, respectively, compared with $96.2 million and 46.9%, respectively, in the third quarter of 2016.
GAAP net income and GAAP net income margin in the third quarter of 2017 were $36.6 million and 14.9% respectively, compared with $24.7 million, and 12.1% respectively in the third quarter of 2016.
GAAP earnings per share (diluted) for the third quarter of 2017 were $0.75, compared with $0.51, for the third quarter of 2016.
Adjusted EBITDA (as defined below) and adjusted EBITDA margin for the third quarter of 2017 were $57.6 million and 23.5%, respectively, compared with $43.8 million and 21.4%, respectively, in the third quarter of 2016.
Non-GAAP net income and non-GAAP net income margin for the third quarter of 2017 were $44.7 million and 18.2%, respectively, compared with $33.0 million and 16.1%, respectively, for the third quarter of 2016.
Non-GAAP earnings per share (diluted) for the third quarter of 2017 were $0.91, compared with $0.68 per share, for the third quarter of 2016.
A reconciliation of each of the Company's non-GAAP measures to the comparable GAAP measure (the "Reconciliation") is included at the end of this press release.
As of September 30, 2017, the Company had cash, cash equivalents, short term bank deposits and marketable securities of $247.0 million, and debt of $72.4 million. As of September 30, 2017, the actual number of ordinary shares outstanding was approximately 48.0 million.
Fourth quarter 2017 Guidance
The Company expects revenues for the fourth quarter of 2017 to be in the range of $245 million to $255 million; and gross margin for the fourth quarter of 2017 to be approximately 48.0%, based on current expectations of product mix.
The Company will host an Investor Day on Monday, November 6, 2017 at the W Hotel in New York City. The event will include the introduction of a new Orbotech financial model as well as presentations by business teams. Presentations will commence promptly at 9:00 a.m. EST and the event is expected to conclude at approximately 1:00 p.m. EST. To register for attendance, please contact Rami Rozen, Orbotech Director of Investor Relations, on Email Contact A webcast of the presentation will be broadcast simultaneously through a link on the Investors section of the Orbotech Ltd. website. A replay of the webcast, as well as presentation materials, will remain available for 90 days.
An earnings conference call for the Company's third quarter 2017 results is scheduled for today, November 1, 2017, at 8:30 a.m. EDT. The dial-in number for the conference call is + 1-646-254-3362 or (US toll-free) 877-280-2296 and a replay will be available on telephone number +1-719-457-0820 or (US toll-free) 888-203-1112 until November 15, 2017. The pass code is 9707467 or Orbotech Q3. A live webcast of the conference call can also be heard by accessing the Company's website at: https://edge.media-server.com/m6/p/y9sehn6g. The webcast will remain available for 12 months at: http://investors.orbotech.com/phoenix.zhtml?c=71865&p=irol-audioarchives.
About Orbotech Ltd.
Orbotech Ltd. is a leading global supplier of yield-enhancing and process-enabling solutions for the manufacture of electronics products. Orbotech provides cutting-edge solutions for use in the manufacture of PCBs, FPDs and SDs, designed to enable the production of innovative, next generation electronic products and improve the cost effectiveness of existing and future electronics production processes. Orbotech's core business lies in enabling electronic device manufacturers to inspect and understand PCBs and FPDs to verify their quality ('reading'); pattern the desired electronic circuitry on the relevant substrate and perform three dimensional shaping of metalized circuits on multiple surfaces ('writing'); and utilize advanced vacuum deposition and etching processes in SD and semiconductor manufacturing ('connecting'). Orbotech refers to this 'reading', 'writing' and 'connecting' as enabling the 'Language of Electronics'. For further information, visit