Orbotech Reports Revenues of $250.6 million for Q1 2018

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Orbotech today announced its consolidated financial results for the first quarter of 2018.

Throughout the early part of 2018, the Company has continued to deliver innovative solutions to its customers that will help them overcome some of the most difficult production challenges they face today. The technology leadership and momentum in Orbotech's business underscore our confidence in our ability to capitalize on the opportunities available to us for the remainder of 2018.

Separately, Orbotech is today announcing that it has received orders totaling approximately $50 million from Taipei-based Career Technology (Mfg.) Co., Ltd., a worldwide manufacturer of flexible printed circuit (FPC) PCBs for advanced electronic devices, for a range of solutions for liquid-crystal polymer (LCP) FPC production. These solutions will be implemented in Career's new FPC production lines for the manufacture of next generation LCP smartphone flexible components.  Delivery is scheduled to begin during the second quarter of 2018 and to be completed by the end of 2018.  These significant orders further validate Orbotech's position as a technology leader in its served industries. 

Revenues for the first quarter of 2018 totaled $250.6 million, compared with $187.6 million in the first quarter of 2017, and $256.9 million in the fourth quarter of 2017.

In the Company's Production Solutions for Electronics Industry segment:

• Revenues from the Company's printed circuit board (PCB) business were $87.1 million (including $53.3 million in equipment sales) in the first quarter of 2018.  This compares to PCB revenues of $77.5 million (including $49.8 million in equipment sales) in the first quarter of 2017.
• Revenues from the Company's flat panel display (FPD) business were $80.6 million (including $69.1 million in equipment sales) in the first quarter of 2018.  This compares to FPD revenues of $53.4 million (including $43.0 million in equipment sales) in the first quarter of 2017.
• Revenues from the Company's semiconductor device (SD) business were $78.6 million (including $67.2 million in equipment sales) in the first quarter of 2018.  This compares to SD revenues of $52.5 million (including $41.5 million in equipment sales) in the first quarter of 2017.

Revenues in the Company's other segments totaled $4.3 million in the first quarter of 2018, compared with $4.2 million in the first quarter of 2017.

Service revenues for the first quarter of 2018 were $58.6 million, compared with $50.9 million in the first quarter of 2017.

Gross profit and gross margin in the first quarter of 2018 were $117.9 million and 47.1%, respectively, compared with $87.1 million and 46.4%, respectively, in the first quarter of 2017.

GAAP net income and GAAP net income margin in the first quarter of 2018 were $30.3 million and 12.1%, respectively, compared with $14.9 million and 8.0%, respectively, in the first quarter of 2017.

GAAP earnings per share (diluted) for the first quarter of 2018 were $0.61, compared with $0.31 for the first quarter of 2017.

Adjusted EBITDA (as defined below) and adjusted EBITDA margin for the first quarter of 2018 were $53.1 million and 21.2%, respectively, compared with $32.5 million and 17.3%, respectively, in the first quarter of 2017.

Non-GAAP net income and non-GAAP net income margin for the first quarter of 2018 were $41.1 million and 16.4%, respectively, compared with $22.3 million and 11.9%, respectively, for the first quarter of 2017.  Non-GAAP earnings per share (diluted) for the first quarter of 2018 were $0.83, compared with $0.46 per share, for the first quarter of 2017.

As of March 31, 2018, the Company had cash, cash equivalents, short term bank deposits and marketable securities of $301.9 million, and debt of $72.6 million.  During the first quarter of 2018, the Company utilized cash for operations of $20.4 million.  As of March 31, 2018, the actual number of ordinary shares outstanding was approximately 48.5 million.

2018 Guidance

The Company expects second quarter 2018 revenue to be in the range of $250 million to $265 million based on current expectations of product mix. Other than with respect to the foregoing quarterly revenue guidance, the Company is withdrawing the financial guidance provided with respect to 2018 and beyond for all financial metrics and periods presented.

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 printed circuit boards (PCBs), flat panel displays (FPDs), and semiconductor devices (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 and 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 more information, click here.