SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
May 3, 2021
Date of Report (date of earliest event reported)
INTEVAC, INC.
(Exact name of Registrant as specified in its charter)
State of Delaware | 0-26946 | 94-3125814 | ||
(State or other jurisdiction of
incorporation or organization) |
(Commission
File Number) |
(IRS Employer
Identification Number) |
3560 Bassett Street
Santa Clara, CA 95054
(Address of principal executive offices)
(408) 986-9888
(Registrant’s telephone number, including area code)
N/A
(Former name or former address if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading
|
Name of each exchange
|
||
Common Stock ($0.001 par value) | IVAC | The Nasdaq Stock Market LLC (Nasdaq) Global Select |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition
On May 3, 2021, Intevac, Inc. issued a press release reporting its financial results for the three months ended April 3, 2021. A copy of the press release issued by the Company concerning the foregoing results is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
The foregoing information is intended to be furnished under Item 2.02 of Form 8-K, “Results of Operations and Financial Condition.” This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
99.1 | Press Release. | |
104 | The cover page from this Current Report on Form 8-K, formatted in Inline XBRL |
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
INTEVAC, INC. | ||||||
Date: May 3, 2021 |
/s/ JAMES MONIZ |
|||||
James Moniz | ||||||
Executive Vice President, Finance and Administration, Chief Financial Officer, Secretary and Treasurer |
Exhibit 99.1
|
3560 Bassett Street, Santa Clara CA 95054
|
James Moniz Chief Financial Officer (408) 986-9888 |
Claire McAdams Investor Relations (530) 265-9899 |
INTEVAC ANNOUNCES FIRST QUARTER 2021 FINANCIAL RESULTS
Santa Clara, Calif.May 3, 2021Intevac, Inc. (Nasdaq: IVAC) today reported financial results for the first quarter ended April 3, 2021.
As expected, the first quarter of 2021 was challenging, as we experienced a pause in revenue momentum within both of our businesses, commented Wendell Blonigan, president and chief executive officer of Intevac. In Photonics, the pause was chiefly related to the completion of night vision camera deliveries for the funded R&D stage of the IVAS program, and in our Thin-film Equipment (TFE) business, we are in a period of reduced capital investments by our hard disk drive (HDD) customers. At the same time, highlights of the quarter included the successful completion of our INTEVAC MATRIX® evaluation program for advanced semiconductor packaging, which resulted in our first purchase order, and first revenues, in this new market for Intevac. We announced an incremental new $7 million development program in Photonics that demonstrates the U.S. militarys continued commitment to Intevacs gated SWIR LIVAR® technology for new weapon systems applications. We also demonstrated our ability to manage our cash and discretionary spending during a difficult quarter. Notably, we improved upon our already strong balance sheet by generating positive cash flow from operations, ending the first quarter with $53.6 million in total cash, cash equivalents, restricted cash, and investments, an increase of $3.2 million since year-end 2020.
While these pauses in revenue momentum will be challenging to our financial results in the near term, our longer-term outlook remains strong. We continue to expect Intevac will participate in a meaningful way in the major programs and technology trends that are positively impacting the outlooks for both Photonics and TFE. These include being a supplier of digital night vision technology for our U.S. military ground soldiers, and being the worlds leading provider of HDD media production systems as the industry moves forward with capacity expansion plans in support of strong secular growth in data center and cloud storage. Our continued progress in MATRIX and VERTEX evaluation programs and demos provide additional growth potential, incremental to the strong growth expected in our two core markets. Our demonstrated ability to preserve our balance sheet as we navigate through these lean periods will serve us well, as we expect a return to growth in 2022.
($ Millions, except per share amounts) | Q1 2021 | Q1 2020 | ||||||||||||||
GAAP Results | Non-GAAP Results | GAAP Results | Non-GAAP Results | |||||||||||||
Net Revenues |
$ | 16.2 | $ | 16.2 | $ | 18.8 | $ | 18.8 | ||||||||
Operating Loss |
$ | (6.5 | ) | $ | (6.5 | ) | $ | (1.1 | ) | $ | (1.1 | ) | ||||
Net Loss |
$ | (6.5 | ) | $ | (6.5 | ) | $ | (1.2 | ) | $ | (1.2 | ) | ||||
Net Loss per Diluted Share |
$ | (0.27 | ) | $ | (0.27 | ) | $ | (0.05 | ) | $ | (0.05 | ) |
Intevacs non-GAAP adjusted results exclude the impact, where of applicable, 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.
First Quarter 2021 Summary
The net loss was $6.5 million, or $0.27 per diluted share, compared to a net loss of $1.2 million, or $0.05 per diluted share, in the first quarter of 2020.
Revenues were $16.2 million, including $9.2 million of TFE revenues and $7.0 million of Photonics revenues. TFE revenues consisted of one MATRIX PVD system for advanced semiconductor packaging, as well as HDD upgrades, spares and service. Photonics revenues consisted of $3.8 million of product sales and $3.2 million of research and development contracts. In the first quarter of 2020, revenues were $18.8 million, including $8.0 million of TFE revenues which consisted of upgrades, spares and service. Photonics revenues consisted of $5.9 million of product sales and $5.0 million of research and development contracts.
TFE gross margin was 23.1%, compared to 44.0% in the first quarter of 2020. The decline was primarily due to product mix, given the lower-margin contribution from the first MATRIX PVD system in the first quarter of 2021 and the higher mix of higher-margin HDD upgrades in the first quarter of 2020. Photonics gross margin was 13.1%, compared to 42.8% in the first quarter of 2020. The decline was primarily due to lower margins on research and development contracts resulting from higher costs related to additional work needed in order to complete the integration of our camera into the IVAS platform as we neared the end of the development program. Consolidated gross margin was 18.8%, compared to 43.3% in the first quarter of 2020.
R&D and SG&A expenses were $9.6 million, compared to $9.3 million in the first quarter of 2020.
Order backlog totaled $43.1 million on April 3, 2021, compared to $46.9 million on January 2, 2021 and $87.2 million on March 28, 2020. Backlog at both April 3, 2021 and January 2, 2021 did not include any 200 Lean® HDD systems. Backlog at March 28, 2020 included two 200 Lean HDD systems.
The Company ended the quarter with $53.6 million of total cash, cash equivalents, restricted cash and investments and $97.2 million in tangible book value.
Use of Non-GAAP Financial Measures
Intevacs 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 Companys 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 Companys business from the same perspective as the Companys management and facilitate comparisons of this periods 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 13718576. For international callers, the dial-in number is +1 (201) 389-0921. You may also listen live via the Internet at https://www.webcast-eqs.com/intevac20210503/en or on the Companys investor relations website at ir.intevac.com. For those unable to attend live, an archived webcast of the call will be available at ir.intevac.com.
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 Companys website at www.intevac.com.
200 Lean®, INTEVAC MATRIX®, INTEVAC VERTEX®, ENERGi®, LIVAR®, DIAMOND DOG®, DiamondClad®, 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 Companys 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 Companys stock price. These risks and other factors are detailed in the Companys periodic filings with the U.S. Securities and Exchange Commission.
INTEVAC, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per share amounts)
Three months ended | ||||||||
April 3,
2021 |
March 28,
2020 |
|||||||
Net revenues |
||||||||
TFE |
$ | 9,238 | $ | 7,962 | ||||
Photonics |
7,003 | 10,878 | ||||||
|
|
|
|
|||||
Total net revenues |
16,241 | 18,840 | ||||||
Gross profit |
3,054 | 8,156 | ||||||
Gross margin |
||||||||
TFE |
23.1 | % | 44.0 | % | ||||
Photonics |
13.1 | % | 42.8 | % | ||||
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Consolidated |
18.8 | % | 43.3 | % | ||||
Operating expenses |
||||||||
Research and development |
3,625 | 3,284 | ||||||
Selling, general and administrative |
5,930 | 5,972 | ||||||
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|
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Total operating expenses |
9,555 | 9,256 | ||||||
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|
|
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Total operating loss |
(6,501 | ) | (1,100 | ) | ||||
Operating income (loss) |
||||||||
TFE |
(4,002 | ) | (2,531 | ) | ||||
Photonics |
(1,146 | ) | 2,912 | |||||
Corporate |
(1,353 | ) | (1,481 | ) | ||||
|
|
|
|
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Total operating loss |
(6,501 | ) | (1,100 | ) | ||||
Interest and other income |
29 | 142 | ||||||
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|
|
|
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Loss before provision for income taxes |
(6,472 | ) | (958 | ) | ||||
Provision for income taxes |
32 | 266 | ||||||
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Net loss |
$ | (6,504 | ) | $ | (1,224 | ) | ||
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Net loss per share |
||||||||
Basic and Diluted |
$ | (0.27 | ) | $ | (0.05 | ) | ||
Weighted average common shares outstanding |
||||||||
Basic and Diluted |
24,033 | 23,483 |
INTEVAC, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except par value)
April 3,
2021 |
January 2,
2021 |
|||||||
(Unaudited) | (see Note) | |||||||
ASSETS |
||||||||
Current assets |
||||||||
Cash, cash equivalents and short-term investments |
$ | 48,893 | $ | 44,180 | ||||
Accounts receivable, net |
18,229 | 28,646 | ||||||
Inventories |
20,501 | 21,689 | ||||||
Prepaid expenses and other current assets |
1,789 | 1,893 | ||||||
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|
|
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Total current assets |
89,412 | 96,408 | ||||||
Long-term investments |
3,919 | 5,388 | ||||||
Restricted cash |
787 | 787 | ||||||
Property, plant and equipment, net |
10,456 | 11,004 | ||||||
Operating lease right-of-use-assets |
7,582 | 8,165 | ||||||
Deferred income tax and other long-term assets |
5,485 | 5,486 | ||||||
|
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|
|
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Total assets |
$ | 117,641 | $ | 127,238 | ||||
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LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||
Current liabilities |
||||||||
Current operating lease liabilities |
$ | 2,913 | $ | 2,853 | ||||
Accounts payable |
2,765 | 4,259 | ||||||
Accrued payroll and related liabilities |
5,150 | 7,679 | ||||||
Other accrued liabilities |
3,136 | 3,598 | ||||||
Customer advances |
42 | 33 | ||||||
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|
|
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Total current liabilities |
14,006 | 18,422 | ||||||
Non-current liabilities |
||||||||
Non-current operating lease liabilities |
6,045 | 6,803 | ||||||
Other long-term liabilities |
435 | 457 | ||||||
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Total non-current liabilities |
6,480 | 7,260 | ||||||
Stockholders equity |
||||||||
Common stock ($0.001 par value) |
24 | 24 | ||||||
Additional paid-in capital |
195,364 | 193,173 | ||||||
Treasury stock, at cost |
(29,551 | ) | (29,551 | ) | ||||
Accumulated other comprehensive income |
552 | 640 | ||||||
Accumulated deficit |
(69,234 | ) | (62,730 | ) | ||||
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Total stockholders equity |
97,155 | 101,556 | ||||||
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Total liabilities and stockholders equity |
$ | 117,641 | $ | 127,238 | ||||
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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) |
|
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Three months ended | ||||||||
April 3,
2021 |
March 28,
2020 |
|||||||
Non-GAAP Loss from Operations |
||||||||
Reported operating loss (GAAP basis) |
$ | (6,501 | ) | $ | (1,100 | ) | ||
Restructuring charges1 |
43 | | ||||||
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|
|
|
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Non-GAAP Operating Loss |
$ | (6,458 | ) | $ | (1,100 | ) | ||
Non-GAAP Net Loss |
||||||||
Reported net loss (GAAP basis) |
$ | (6,504 | ) | $ | (1,224 | ) | ||
Restructuring charges1 |
43 | | ||||||
Income tax effect of non-GAAP adjustments2 |
| | ||||||
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|
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|
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Non-GAAP Net Loss |
$ | (6,461 | ) | $ | (1,224 | ) | ||
Non-GAAP Net Loss Per Share |
||||||||
Reported net loss per share (GAAP basis) |
$ | (0.27 | ) | $ | (0.05 | ) | ||
Restructuring charges1 |
| | ||||||
Non-GAAP Net Loss Per Share |
$ | (0.27 | ) | $ | (0.05 | ) | ||
Weighted average number of diluted shares outstanding |
24,033 | 23,483 |
1 |
Results for the three months ended April 3, 2021 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. |