Photon Dynamics Reports Record
Third Quarter Results; Revenues, Bookings, Backlog,
Gross Margins and Profits Surpass Record Levels
SAN JOSE, Calif., July 18 /PRNewswire/ -- Photon Dynamics, Inc. (Nasdaq: PHTN - news)
today reported record financial results for the third quarter ended June 30, 2000. The results of prior
periods have been restated to include the financial statements of CR Technology, Inc., which was
acquired on November 30, 1999 and accounted for as a pooling of interest.
For the third quarter of fiscal 2000, revenues increased to $22.1 million compared with $19.2 million
for the second quarter and $13.7 million, as restated, for the third quarter of fiscal 1999. Net income
for the quarter was $4.5 million, or $0.36 per diluted share, compared to net income of $3.4 million,
or $0.28 per diluted share for the second quarter, and net income of $1.5 million, or $0.15 per
diluted share, as restated, for the same period a year ago.
``Once again we are extremely pleased with the financial performance of the company,'' said Vincent
Sollitto, President and CEO of Photon Dynamics, Inc. ``The demand for our yield management
systems continues to be strong, driven by the increased investment of existing and emerging
applications using thin-film transistor (TFT) active-matrix liquid crystal displays (AMLCD),'' Mr.
Sollitto said.
DisplaySearch, a leading market research firm, forecasts that the overall TFT-AMLCD market will
grow at 23 percent compound annual growth rate (CAGR) to $48 billion by 2005. DisplaySearch
forecasts that this growth will stimulate $34 billion in equipment spending from 1999 to 2005 on a
cumulative basis.
The company also announced and delivered two new products in the third quarter, one which
addresses the flat panel display industry, the AC-2000 Array Test System, and the other which
addresses the printed circuit board assembly and advanced semiconductor packaging industries, the
XRV Combo Inspection System.
``Based on the success of our early installations of the AC-2000 Array Test System, we have
authorized our sales force to expand availability of the product to all customers. We also successfully
installed the XRV Combo Inspection System -- which we believe is the only system of its kind
currently available in the market -- at two customer sites. Lastly, we announced the opening of our
new Taiwan sales office to address the growing industry demand for regional customer support,''
concluded Mr. Sollitto.
For the first nine months of fiscal 2000, revenues increased 90 percent to $58.1 million from $30.5
million. Net income for the period rose to $10.3 million, or $0.88 per diluted share, excluding
non-recurring acquisition expenses, compared to net income of $0.3 million, or $0.03 per share, as
restated, for the same period a year ago. Including the effect of non-recurring acquisition costs, net
income for the first nine months of fiscal 2000 was $9.4 million, or $0.80 per diluted share.
Bookings for the second quarter exceeded $30 million. As a result, the company posted a record
backlog of over $47 million. Gross margins improved to 48 percent in the third quarter of fiscal 2000
from 47 percent in the second quarter and, 45 percent in the comparable quarter of 1999. Gross
margins fluctuate on a quarterly basis due to production volume and product mix, among other
factors.
As a result of the secondary offering in the second quarter and the cumulative financial results, the
company's balance sheet as of June 30, 2000 reflects $97.8 million in cash and related investments,
$114.6 million in working capital and $117.8 million in shareholders' equity.
About Photon Dynamics
Photon Dynamics is a leading worldwide supplier of yield management solutions to the flat panel
display, printed circuit board assembly and advanced semiconductor packaging industries. Founded
in 1986, the company currently has approximately 205 employees with sales offices and customer
support services in Aliso Viejo, CA, Hsinchu, Taiwan, San Jose, CA, Seoul, Korea and Tokyo,
Japan. The company has been issued 36 U.S. patents for flat panel display test, repair, and
inspection technologies and has 7 U.S. and foreign patent applications pending. For more
information about Photon Dynamics, please visit the company's web site at
www.photondynamics.com.
Safe Harbor Statement
To the extent that any of the statements contained herein are forward-looking, such statements are
based on current expectations that involve a number of uncertainties and risks. Such uncertainties
and risks include, but are not limited to, growth in the FPD market, market acceptance of the
company's products, the timely development of new products, the enhancement of existing products,
manufacturing delays, dependence on principal customers, competitive pricing pressures, product
volume and mix, global economic conditions, and particularly economic conditions in Asia,
dependence on international operations, availability of key components, timing of orders received,
fluctuations in foreign exchange rates, and introduction of competing products having technological
and/or pricing advantages. As a result, the company's operating results may fluctuate, especially
when measured on a quarterly basis. For further information, refer to the company's 1999 Form
10-KSB and Forms 10-QSB as filed with the Securities and Exchange Commission. Actual results
may differ materially from such expectations.
Photon Dynamics, Inc.
Condensed Consolidated Balance Sheets
(In thousands)
June 30, 2000 September 30, 1999
(Unaudited) (Audited)
Assets
Current assets:
Cash, cash equivalents
and investments $97,839 $8,026
Accounts receivable, net 19,878 13,630
Inventories 11,006 7,112
Prepaid expenses and
other current assets 397 714
Total current assets 129,120 29,482
Property, equipment and
leasehold improvements, net 2,189 1,817
Other assets 998 768
Total assets $132,307 $32,067
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $4,224 $2,831
Accrued expenses and
other current liabilities 8,162 5,230
Deferred revenue 215 655
Income taxes payable 1,917 305
Total current liabilities 14,518 9,021
Long-term debt -- --
Shareholders' equity:
Common stock 131,317 45,972
Accumulated deficit (13,508) (22,929)
Accumulated other
comprehensive income (20) 3
Total shareholders' equity 117,789 23,046
Total liabilities and
shareholders' equity $132,307 $32,067
Photon Dynamics, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended, Nine Months Ended
June 30 June 30,
2000 1999 2000 1999
Revenue $22,086 $13,700 $58,129 $30,530
Cost of revenue 11,570 7,499 30,965 17,605
Gross margin 10,516 6,201 27,164 12,925
Operating expenses:
Research and development 3,181 1,641 8,018 4,303
Selling, general
and administrative 3,391 2,823 9,272 8,074
Non-recurring
acquisition charges -- -- 860 --
Total operating expenses 6,572 4,464 18,150 12,377
Operating income 3,944 1,737 9,014 548
Interest income 1,600 51 2,634 198
Interest expense and other (21) 9 (107) (94)
Income before income taxes 5,523 1,797 11,541 652
Provision for income taxes 1,000 319 2,120 383
Net income $4,523 $1,478 $9,421 $269
Basic earnings per share $0.39 $0.16 $0.88 $0.03
Diluted earnings per share $0.36 $0.15 $0.80 $0.03
Shares used in computing
basic earnings per share 11,613 9,340 10,664 9,200
Shares used in computing
diluted earnings per share 12,630 10,150 11,741 9,781 |
