ASYS - Earnings call transcript Q3 2024

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Operator

Good day, and welcome to the Amtech Systems Fiscal Third Quarter 2024 Earnings Conference Call. Please note that this call is being recorded and simultaneously webcast. I would now like to turn the call over to Erica Mannion of Sapphire Investor Relations. Please go ahead.

Erica Mannion

Good afternoon, and thank you for joining us for Amtech Systems Fiscal Third Quarter 2024 Conference Call. call Lisa Bob and Gibbs, Incoming Financial the Chief Chairman Wade on Chief Officer; Executive Chief Officer. me today Daigle, are and Jenke, With Financial Officer; for Amtech its today, of market of third quarter close financial After results the fiscal XXXX. released posted is company's the Investors release in website earnings www.amtechsystems.com the on The at section.

like everyone public begin, that this covers Before filings harbor and safe I'd call we webcast. the to remind our our disclaimer in

that to comments to, forward-looking be made subject update call uncertainties, today's and contain website. such assumptions our those SEC limited the statements. on statements filings, which will including, and to Investors the any forward-looking The all our of within section are in not corporate risks assumes to company of obligation Some but posted of are contained no

and plans. to which and worldwide capital including overall including the ongoing and results forward-looking factors You in statements our These supply products; change factors to and in and acceptance filings, the markets economic from market performance, expectations. challenges results the materially conditions, the used not of on trade SEC chain risk our labor those undue Form changes the allocation by place differ changing risks; equity Forms logistics, for as materially volatility Among including are effect political only sanctions, technologies the XX-K market the are demand of and reliance and of conditions, competitors; and Other cautioned effect detailed and XX-Q. differ credit future customers in speak actual of today. could statements forward-looking cause not current in actual a guarantee are from are could which statements, important

measures call, referring we quarter in as results. financial will financial be Additionally, discuss the today's third we non-GAAP to conference

measures non-GAAP these of issued today. included press GAAP reconciliation results our to a find in the actual release You'll

to would over turn to Daigle. Bob the Chief Executive I Officer, call like Now Amtech's

Robert Daigle

high lay third the $XX.X the call. current our the for to joining markets we're markets leverage quarter, you match I'm see foundation guidance benefits optimize Amtech's Thank of we've our and In everyone. to remains recover. our quarterly the $X.X mixed. that of cost landscape for afternoon, operating structure environment of Revenue million past end pleased the macroeconomic we range, taken adjusted meaningful EBITDA somewhat beginning million. Good the the few financial was conference the serve to exceeded end for quarters. continued we The over our actions demand and as

demand semiconductor have the in Within packaging advanced see improvement we applications. industry, incremental for begun to

Offsetting seen increase expect with activity are sharp not a horizontal quoting since the improvement. of tools few for a quarters. past on markets. and and we experienced have primarily furnaces recovery, industrial this seeing targeted electronic from power Based tailwind, a gradual our are incremental for customers, cyclical discussions diffusion continued see we of softening While we in to our applications demand have semiconductor lows these demand automotive the we in

margin from in stabilization near levels our contribution are products overall significantly demand. our markets, end neutral While future these our impacts corporate backlog we average. in the seeing this term, as materials and than overall and Within revenue was a lower profit remain our the substrates the both

somewhat for lumpy, for continues for Although fabrication consumables semiconductor demand parts to remains used improve. the replacement demand

we although near trough in sharp passed the believe Taken term. together, in do recovery for a not we've the expect demand we this segment,

the quarter, the we focus are In completed rebound broader in await relocation the third The capacity. efficiency optimizing U.S. $X to smaller contract by our manufacturing year production million impacting to flexibility. manufacturers expanded markets, and on more operational we BTU cost-effective Massachusetts without facility about While a our fixed a of our and across to the facility operations. we smaller, with demand in reduces our facility continuing partnership improve cost

aligned positive and in demand, to ongoing annualized we softness organization said, due cash implemented to believe our we've has actions in full success be allowed flow quarters. better our EBITDA business. will few taken operating addition, us savings quarter despite serve. million market markets the Overall, the initiatives over delivering support in backlog positive a in deliver to adjusted third over measures still see our we current last consecutive to That near-term cost are adjusted while quarters $X The existing of several the pricing we EBITDA the have In it impact and of of see parts resulted the of the benefits few we the beginning past quarters before profitability. we've our approximately

secular Looking ahead, for several trends we demand that is on our capitalize positioned will drive well products. to believe Amtech

market, the in expect our power generate consumables of Within automotive and that and growth electric we equipment. electronic continued full applications strong hybrid will for demand vehicles

used Within the computing. a packaging in broader processors semiconductor role market, tools advanced in of our critical high-performance the play

to increase, OEM a demand expect for As reflow see in utilization we rebound OSAT and our rates equipment. stronger

that, from assembly shareholder addition, resilient In we to With government regain benefit we enhance details confident the remain Lisa to we initiatives are summary, implementing working turn and value supply industry more reducing quarter. the the In chains. efficiency momentum. on over as capital expect to markets players will and semiconductor our I'll significant and third strategic near-shoring further it secure that by made investments operational being build for generate the and target electronic

Lisa Gibbs

segment prior decreased to product the XXXX. specific or projects $X.XX income quarter from operating and second period. by income of XXXX to per GAAP the share to on Bob. net quarter and to operating labor-related Material GAAP non-GAAP the primarily to decrease to decreased due prior compares of compares increased XX% year fiscal year or result shipping Selling, reduction across to $X of attributable and in fiscal fiscal in income Substrates year X% of third labor the as share. to of decreased increased the million wafer the equipment. GAAP operating gross $X.X refill sales lower sequential year primarily share affected was the was for a timing to from quarter engineering primarily quarter sequential decrease loss and $X quarter of non-GAAP product per is million to million parts months $XX.X $X.X of positively compared per $X.X and basis due decreased in income net cash to sequentially GAAP Thank efforts compared GAAP equivalents million XX, share. compared a million the a services relatively and the sequential well On million the sales. in million XX, prior net on million offset administrative sequentially XXXX. million for preceding and not to $X.X and XXXX. most during income cost in payments in prior of to share XXXX, semiconductor primarily our development gross due for $X.XX increase $X.X Non-GAAP to equipment due of of Materials and quarter attributable same and net prior parts year compared fiscal and The for loss is fiscal compared same fiscal lower net period. Research, in compared primarily $X.X were million or preceding third same same fiscal mix basis from expenses million the portfolio was revenue for GAAP the as periods. sequential to XXXX, ended our the year non-GAAP XXXX, gross at and period, segment sequential to development GAAP Compared and Unrestricted did income and prior $X.X increased million XXXX expenses, XX, decrease and at was In per $X.X in related was purchases decrease year segments reductions segment prior the XXXX million third million. labor-related This as and third and margin & quarter Net partially that higher shipping of a or higher commissions income decreased per slowdown semiconductor between broader services. the & on and prior Non-GAAP increased XXXX $XX.X $XX,XXX June cash same our of XX, general market. $X.X basis, cleaning same the GAAP of margin to both period, to decrease the $X.X margin The as consumables $X.X of XXXX, operating sequential to expenses of margin XX, revenues. or operating were loss recur. $X.X million decreased third was was on sales due non-GAAP due operating approximately the consistent lower lower $X.X quarter $X.X share compared $X.XX initiatives the less $X.XX the third of period, our the is increased for per XXXX. expenses fiscal as same expenses Compared expenses our of a quarter gross income million with Debt net contributed favorable year $X.XX period. to $X.XX mix, revenues cash prior in September of is product GAAP million by Substrates of quarter of September second million the a to of primarily This you, for Net of the income our The period. sequentially $X.X revenue. XXXX. million GAAP June year reflow equipment X or $X.X of June in million

we for the booked shipping of from Bob differences some on, are backlog. products and in values touched the compared order new As margins to older seeing orders

a of whose Our quarter current our of furnaces fiscal larger and the below profit average. third shipments are corporate expectations XXXX include levels mix for

orders of as we will market volumes higher-margin values trending towards semi the bookings. types order of have but higher New are And products. recovers, lower these

our to backlog, segment expect trends a we continue should to time, book-to-bill stay or the exceed As we portion orders. this our X. towards in below our and be of work higher semi especially ship business over book book-to-bill, X:X But down as closer

gross take gross margins As it improve, quarters through. we've and future to X but our backlog will of work discussed another to its we to for the this expect X way previously, our margin

to our outlook. Now turning

range fiscal we the expect $XX quarter XX, EBITDA adjusted ending nominally to XXXX, revenues fourth the For in of $XX positive. million September with million

million reduce will revenue and applications. We packaging earnings outlook took equipment structural $X of for XXXX, quarters significantly strong or approximately second manufacturers. the we financial product Although improve negatively Amtech's better by serving first are align consumables can by the positively confident These our during timing profitability and and semiconductor with and remains challenging, action steps orders, market cycles. both value. near-term of advanced significantly and fiscal prospects and Operating which the with through future mobility should results costs the results of for pricing remain be advanced annually the and challenges logistical enhance shipments, system results impacted

semiconductor cause materially may differ differ The on changes dollar the RMB the weeks RMBs, could Additionally, be United in equipment the to and ahead. based demand. months value in impacted rate in relation cyclical by States the between of currency. provided States inherently to RMB. in an results Chinese results the actual United portion is expectations. is and the can in assumed of dollar market denominated from outlook Amtech's Changes results the exchange and The industries a Actual

its work and Amtech the As am for dedication. would for for also like the the will thank Amtech I I and would their over Bob, welcome of I sign support. to Bob leadership excited you. to Amtech I ahead and strategy. for call to thank hard and off, team their the all to like back road turn Wade and I Board strong

Robert Daigle

ERP companies. professional the success excellence for I commitment contributions would great I'm company at ABLOY, new Jenke, he years. Thank to led to Wade Sweden. and global role. in integrations $XX served past the the and take financial billion CFO Wade. to ASSA FP&A, contribute with I'm back fully a implementations. to Lisa's headquartered pleased recently, Amtech to Prior EMS in Lisa her thank has years greater create financial the our also and welcome efforts traded wish the her of has financial Systems acquisition publicly experience Most and operational greatly over in over spanning optimize that, XX of accounting. our been and and you, aboard he value Welcome her shareholder senior ABLOY I excited with invaluable, like within to group X in recognize company and to functions years to manufacturing His roles SEC Lisa. has to as in Amtech's our a Wade a new CFO. welcome operations moment to ASSA both served of operational Wade and our and BAE cost and team. experience number He ahead. quarters reporting, accounting will

Wade Jenke

to now I and Bob, that today. journey operator call getting you, position Operator? join in it the for given ahead and the leadership know the believe to profit growth potential the of and excited Thank call hello personally the will on revenue, over many the soon. company's I talented exciting in the questions. flow a markets and to team the to and serves. forward significant turn everyone for look to Amtech, Bob you Amtech at I'm has firmly cash

Operator

Thank you. the will and Miller question from session. we with [Operator Your gentlemen, question-and-answer Ladies begin first Mark now comes Benchmark. Instructions]

Mark Miller

I'd actions some actions. pricing you Lisa, to pricing What these like areas the taken? in and best Wade to welcome new Talking Amtech endeavor call. conference your about were wish

Robert Daigle

earlier, Mark, saying lot it broad. as we a of is is let by start it -- been has commented Yes, me it

actions business, take the of felt inflationary needed some with most over of XX-XX to the we months. to So past our parts deal the pressures we

we're been been where your So I different portfolio. that the components on the But would of brought the manufacturing, it needed question and say has across disproportionate equipment to some have that significant inflationary in in directly, really answer think deal pressures I our been with. has systems our parts more we more particularly to

Mark Miller

outlook? activity? Ford their reported for from for and both And quoting recently results positive that's you your that Any terms sales. of in General thoughts impact EV any future strong or seeing are Motors any

Robert Daigle

Yes.

do having I view pretty EV to continue think nice tailwinds. as I some

the I results overall the of demand more seen by has area. we've improved the think somewhat of out some automakers leader market of the offset terms the in the -- been however, in traditional weakness electronics power in

One of of still for in tempered -- they've they're vehicle I also things encouraging, rates, is electric is that us substantial. expectations fairly the full again, think terms Mark, growth the but

So the to we're with more equipment to I vehicles, nice about hybrid helpful play acceptance ICE think probably a that's what but meet us stronger those push to for power tailwind, I broadly requirements. also replace in believe And strong more consumables hybridize, again, consumer a in fuel the the order is beginning given then secular vehicles vehicles traditional that hear efficiency electronics area. to that's and do because we the of

vehicle for we tempered that us. takes do electric full as kind to think things. and somewhat outlook at I EV the hybrid puts that favorable an more of the see So when actually of increasing projections a side with We of look net-net

Mark Miller

increased look quoting-to-quoting like this You you seeing continue? upside was the Are the Does the mentioned activity? for business will reflow drivers one that sales. of it

Robert Daigle

up. And activity what the as us that reflow where packaging a mix assembly. say, the business. would softened packaging more have as and side up importantly, equipment the we've is an at improved higher well quarters surface higher equipment. had increased we're was for there. comes we're we sequentially And ASP side packaging Yes, seeing than margin Both tremendously quoting mount of used traditional seen what seeing shipments demand because in And for advanced for mount have And really the is the surface business several a Mark. manufacture we been of that's I

Mark Miller

and they quarter? operations from CapEx the were from Cash

Lisa Gibbs

in build-out part I of that to more million, $X the our which be of of of numbers here, cash had nearer significant front CapEx that provided building CapEx. in type Massachusetts, just say And year-to-date and year-to-date in We operations finished Mark. a was would bit is great would We $X of little by a million. term, got CapEx. I've over which I me the expect the maintenance

Mark Miller

Okay.

So X these quarters? last were the over year-to-date

Lisa Gibbs

Hm-mm.

Operator

question [Operator Garrigan Kevin Your with from Thank you. next WestPark Instructions] comes Capital.

Kevin Garrigan

versus better for may give or be anything the things may months time, I turning kind that have this market to has ago you getting but your businesses? worse last think I gotten or hope better X Bob, of you asked around in

Robert Daigle

Yes, say I'd more positive. generally

we some couple in I my the I I It's it would quarters significant that tailwind sharp of but for sense least all in serve, in area. say, area, consistent, recovery, we're particular, although would in think up areas hoped of I ago. we I seemed And kind have seeing dried I people I still X -- a about ago always that peak things parts lumpy. of as demand say seeing had I of here rebound, industry recovery replacements. consumables the as parts chip saw that's improvements. a fact we of this demand incremental near very parts reflow some we're say, of the service for to degree And but equipment in that significant mentioned stable. we side not packaging. mentioned, -- in seen we're the seeing either clearly months and V-shaped And or not that in we're that seen but because, as equipment, I are it that think that, business, course, had nowhere that in really and bottom again, incremental is what's side mean, And great so. is improvements we're or general, headwind and some at characterize the would -- the of a a we've the lot and not business sequentially, the that seeing markets the the improvement then, wouldn't -- the maintaining

Kevin Garrigan

the bottom is similar Yes, kind along heard it. everyone just kind still of this of I've point, at we're that waiting. bouncing Got Okay.

Robert Daigle

maybe while and along can our you we has good we bottom deal to lot the we kind our I the just again, If point can we with sure more with in out, strategy, drive market best as that's for operating substantial, things bottom, bouncing add conditions, the demand and really our to doing structure shape been financially can't approach -- but is something, are of, a bouncing something and the cost really that's performance. deal we're wait EBITDA. things And can as make are our

Kevin Garrigan

ton a makes Yes, absolutely. sense. That of

as a new Okay. just the allocation on focus the give for forward. of Perfect. kind then And Lisa, going for guys? capital you in you for just us Can focus and is And investor of follow-up, role the XXXX? congrats rest Amtech of M&A a a bit of terms

Lisa Gibbs

with bottom that We're generation, on building cycle were build out, as the that of going here Massachusetts. I maintenance a we the next even along the returned in saying, say our EBITDA continued here would in I in positive finished kind at the or X. month we annual kind into focus And of as we bounce the CapEx. term, near think to budgeting here we

a in next invest expect bit Wade I business. the as areas potentially to would look at CapEx So and year little Bob more

On the M&A right front, I the now. Bob person this he's more will table turn that back at since to forward-looking

Robert Daigle

we're Yes. I enhance environment, capital to it's into in growth. do I the short in to but deploy think the something more would the medium term in terms that current not term, say in to of how dig starting definitely

Operator

questions Bob CEO, are no call will for further turn I now [Operator Daigle, Instructions] to remarks. time. at closing back over There you. this Thank the

Robert Daigle

a in months. afternoon Well, evening, again we're good thank updating making on and the and coming everyone. progress to call, our look for you Have you forward conference joining the I

Operator

conference you this concludes participation. call. your and gentlemen, Thank Ladies today's for

disconnect. now may You

Amtech Systems (ASYS) 7 Aug 242024 Q3 Earnings call transcript