0001193125-20-199662 8-K 3 20200727 2.02 9.01 20200727 20200727 INTEVAC INC 0001001902 3559 943125814 DE 1231 8-K 34 000-26946 201050499 3560 BASSETT STREET SANTA CLARA CA 95054 4089869888 3560 BASSETT STREET SANTA CLARA CA 95054 8-K 1 d946072d8k.htm 8-K 8-K

 

 

UNITED STATES

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

July 27, 2020

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

Symbol(s)

 

Name of each exchange on which registered

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 July 27, 2020, Intevac, Inc. issued a press release reporting its financial results for the three and six months ended June 27, 2020. 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.


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: July 27, 2020

     

/s/ JAMES MONIZ

     

James Moniz

     

Executive Vice President, Finance and Administration,
Chief Financial Officer, Secretary and Treasurer

EX-99.1 2 d946072dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

 

  

3560 Bassett Street, Santa Clara CA 95054

 

James Moniz

  

Claire McAdams

Chief Financial Officer

  

Investor Relations

(408) 986-9888

  

(530) 265-9899

Intevac Announces Second Quarter 2020 Financial Results

Santa Clara, Calif.—July 27, 2020—Intevac, Inc. (Nasdaq: IVAC) today reported financial results for the quarter and six months ended June 27, 2020.

“We are pleased to report profitable second-quarter financial results, demonstrating excellent execution by our team in delivering strong levels of business to our hard disk drive (HDD) customers and a record quarter in Photonics,” commented Wendell Blonigan, president and chief executive officer. “In light of the constraints placed on our operations and supply chain as a result of the COVID-19 pandemic, our financial results are indicative of the essential role Intevac plays within the critical IT and Defense infrastructure sectors. While 2020 will be an immensely challenging year overall, we are on very strong financial footing and further strengthened the balance sheet in the second quarter, increasing total cash and investments to $45 million. In our Thin-film Equipment (TFE) growth initiatives, we continue to experience pandemic-related delays in our evaluation and development work. Nonetheless, we expect solid levels of business with our HDD customers and a record year in Photonics will enable us to deliver operating profitability for the year and maintain our strong balance sheet until revenue growth resumes.”

 

     Three Months Ended      Three Months Ended  
     June 27, 2020      June 29, 2019  
($ Millions, except per share amounts)    GAAP Results      Non-GAAP
Results
     GAAP Results     Non-GAAP
Results
 

Net Revenues

   $  28.8      $  28.8      $  22.3     $  22.3  

Operating Income (Loss)

   $ 2.1      $ 2.1      $ (0.9   $ (0.9

Net Income (Loss)

   $ 1.5      $ 1.5      $ (1.2   $ (1.2

Net Income (Loss) per Share

   $ 0.06      $  0.06      $ (0.05   $ (0.05

 

     Six Months Ended      Six Months Ended  
     June 27, 2020      June 29, 2019  
     GAAP Results      Non-GAAP
Results
     GAAP Results     Non-GAAP
Results
 

Net Revenues

   $  47.7      $  47.7      $  47.1     $  47.1  

Operating Income (Loss)

   $ 1.0      $ 1.0      $ (2.9   $ (2.9

Net Income (Loss)

   $ 0.3      $ 0.3      $ (3.6   $ (3.6

Net Income (Loss) per Share

   $ 0.01      $ 0.01      $ (0.16   $ (0.16

 

Intevac’s non-GAAP adjusted results exclude the impact, where applicable, of changes in fair value of contingent consideration liabilities associated with business combinations. 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.

Second Quarter 2020 Summary

Net income for the quarter was $1.5 million, or $0.06 per diluted share, compared to a net loss of $1.2 million, or $0.05 per diluted share, in the second quarter of 2019. Non-GAAP net income was $1.5 million or $0.06 per diluted share, compared to the second-quarter 2019 non-GAAP net loss of $1.2 million or $0.05 per diluted share.

Revenues were $28.8 million, including $16.6 million of TFE revenues and $12.2 million of Photonics revenues. TFE revenues consisted of two 200 Lean HDD systems, upgrades, spares and service. Photonics revenues consisted of $6.1 million of research and development contracts and $6.1 million of product sales. In the second quarter of 2019, revenues were $22.3 million, including $13.3 million of TFE revenues, which consisted of one 200 Lean HDD system, upgrades, spares and service, and Photonics revenues of $9.1 million, which included $5.1 million of research and development contracts and $4.0 million of product sales.


TFE gross margin was 36.4% compared to 38.9% in the second quarter of 2019 and 44.0% in the first quarter of 2020. The decline from the first quarter of 2020 and the second quarter of 2019 was primarily due to less favorable product mix.

Photonics gross margin was 43.9% compared to 35.4% in the second quarter of 2019 and 42.8% in the first quarter of 2020. The improvement from the second quarter of 2019 and the first quarter of 2020 was primarily due to higher revenue levels and improved margins on both product sales and research and development contracts. Consolidated gross margin was 39.6%, compared to 37.5% in the second quarter of 2019 and 43.3% in the first quarter of 2020.

R&D and SG&A expenses were $9.3 million, compared to $9.3 million in the second quarter of 2019 and $9.3 million in the first quarter of 2020.

Order backlog totaled $69.0 million on June 27, 2020, compared to $87.2 million on March 28, 2020 and $93.7 million on June 29, 2019. Backlog at June 27, 2020 did not include any 200 Lean HDD systems. Backlog at March 28, 2020 included two 200 Lean HDD systems. Backlog at June 29, 2019 included four 200 Lean HDD systems and five ENERGi solar ion implant systems.

The Company ended the quarter with $44.8 million of total cash, restricted cash and investments and $97.6 million in tangible book value, defined as total stockholders’ equity, less intangible assets.

First Six Months 2020 Summary

Net income was $0.3 million, or $0.01 per diluted share, compared to a net loss of $3.6 million, or $0.16 per diluted share, for the first six months of 2019. Non-GAAP net income was $0.3 million or $0.01 per diluted share, compared to the first-half 2019 non-GAAP net loss of $3.6 million or $0.16 per diluted share.

Revenues were $47.7 million, including $24.6 million of TFE revenues and $23.1 million of Photonics revenues, compared to first-half 2019 revenues of $47.1 million, which included $32.2 million of TFE revenues and $14.9 million of Photonics revenues.

TFE gross margin was 38.9%, an improvement compared to 34.6% in the first six months of 2019, as a result of more favorable product mix. Photonics gross margin was 43.4% compared to 29.9% in the first six months of 2019. The improvement from the first half of 2019 was primarily due to higher revenue levels and improved margins on both product sales and research and development contracts. Consolidated gross margin was 41.1%, compared to 33.1% in the first six months of 2019.

R&D and SG&A expenses were $18.6 million compared to $18.5 million in the first six months of 2019.

Use of Non-GAAP Financial Measures

Intevac’s non-GAAP results exclude the impact, where applicable, of changes in fair value of contingent consideration liabilities associated with business combinations. 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 Company’s 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 Company’s business from the same perspective as the Company’s management and facilitate comparisons of this period’s 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 13706726. For international callers, the dial-in number is +1 (201) 389-0921. You may also listen live via the Internet on the Company’s 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, and solar photovoltaic 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 Company’s website at www.intevac.com.

200 Lean®, INTEVAC MATRIX®, INTEVAC VERTEX®, ENERGi®, 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 for Photonics, 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 Company’s expectations. These risks include, but are not limited to: global economic impacts of COVID-19, supply chain constraints and disruptions related to COVID-19, technology risk and challenges achieving customer adoption and revenue recognition 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 Company’s stock price. These risks and other factors are detailed in the Company’s 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     Six months ended  
     June 27,
2020
    June 29,
2019
    June 27,
2020
    June 29,
2019
 

Net revenues

        

TFE

   $ 16,595     $ 13,264     $ 24,557     $ 32,209  

Photonics

     12,247       9,050       23,125       14,932  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total net revenues

     28,842       22,314       47,682       47,141  

Gross profit

     11,420       8,357       19,577       15,597  

Gross margin

        

TFE

     36.4     38.9     38.9     34.6

Photonics

     43.9     35.4     43.4     29.9
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated

     39.6     37.5     41.1     33.1

Operating expenses

        

Research and development

     3,707       3,431       6,991       7,417  

Selling, general and administrative

     5,609       5,854       11,581       11,105  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     9,316       9,285       18,572       18,522  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating income (loss)

     2,104       (928     1,005       (2,925

Income (loss) from operations

        

TFE

     (174     (1,291     (2,705     (1,892

Photonics

     3,536       1,487       6,448       846  

Corporate

     (1,258     (1,124     (2,738     (1,879
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating income (loss)

     2,104       (928     1,005       (2,925

Interest and other income (expense), net

     62       163       204       322  
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before provision for income taxes

     2,166       (765     1,209       (2,603

Provision for income taxes

     642       417       909       971  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ 1,524     $ (1,182   $ 300     $ (3,574
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) per share

        

Basic

   $ 0.06     $ (0.05   $ 0.01     $ (0.16

Diluted

   $ 0.06     $ (0.05   $ 0.01     $ (0.16

Weighted average common shares outstanding

        

Basic

     23,561       22,991       23,522       22,923  

Diluted

     23,906       22,991       23,953       22,923  


INTEVAC, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

 

     June 27,
2020
    December 28,
2019
 
     (Unaudited)     (see Note)  

ASSETS

    

Current assets

    

Cash, cash equivalents and short-term investments

   $ 38,379     $ 36,487  

Accounts receivable, net

     28,957       28,619  

Inventories

     22,210       24,907  

Prepaid expenses and other current assets

     1,853       1,504  
  

 

 

   

 

 

 

Total current assets

     91,399       91,517  

Long-term investments

     5,604       5,537  

Restricted cash

     787       787  

Property, plant and equipment, net

     11,897       11,598  

Operating lease right-of-use-assets

     9,302       10,279  

Intangible assets, net

     14       274  

Deferred income tax and other long-term assets

     5,826       6,330  
  

 

 

   

 

 

 

Total assets

   $ 124,829     $ 126,322  
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Current liabilities

    

Current operating lease liabilities

   $ 2,709     $ 2,524  

Accounts payable

     5,135       4,199  

Accrued payroll and related liabilities

     6,316       6,488  

Other accrued liabilities

     3,916       3,593  

Customer advances

     433       4,007  
  

 

 

   

 

 

 

Total current liabilities

     18,509       20,811  

Non-current liabilities

    

Non-current operating lease liabilities

     8,228       9,532  

Other long-term liabilities

     437       186  
  

 

 

   

 

 

 

Total non-current liabilities

     8,665       9,718  

Stockholders’ equity

    

Common stock ($0.001 par value)

     24       23  

Additional paid-in capital

     190,266       188,290  

Treasury stock, at cost

     (29,551     (29,158

Accumulated other comprehensive income

     402       424  

Accumulated deficit

     (63,486     (63,786
  

 

 

   

 

 

 

Total stockholders’ equity

     97,655       95,793  
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 124,829     $ 126,322  
  

 

 

   

 

 

 

Note: Amounts as of December 28, 2019 are derived from the December 28, 2019 audited consolidated financial statements.


INTEVAC, INC.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(Unaudited, in thousands, except per share amounts)

 

     Three months ended     Six months ended  
     June 27,
2020
     June 29,
2019
    June 27,
2020
     June 29,
2019
 

Non-GAAP Income (Loss) from Operations

          

Reported operating income (loss) (GAAP basis)

   $ 2,104      $ (928   $ 1,005      $ (2,925

Change in fair value of contingent consideration obligations1

     —          —         —          7  
  

 

 

    

 

 

   

 

 

    

 

 

 

Non-GAAP Operating Income (Loss)

   $ 2,104      $ (928   $ 1,005      $ (2,918
  

 

 

    

 

 

   

 

 

    

 

 

 

Non-GAAP Net Income (Loss)

          

Reported net income (loss) (GAAP basis)

   $ 1,524      $ (1,182   $ 300      $ (3,574

Change in fair value of contingent consideration obligations1

     —          —         —          7  
  

 

 

    

 

 

   

 

 

    

 

 

 

Non-GAAP Net Income (Loss)

   $ 1,524      $ (1,182   $ 300      $ (3,567
  

 

 

    

 

 

   

 

 

    

 

 

 

Non-GAAP Net Income (Loss) Per Diluted Share

          

Reported net income (loss) per diluted share (GAAP basis)

   $ 0.06      $ (0.05   $ 0.01      $ (0.16

Change in fair value of contingent consideration obligations1

   $ —        $ —       $ —        $ —    

Non-GAAP Net Income (Loss) Per Diluted Share

   $ 0.06      $ (0.05   $ 0.01      $ (0.16

Weighted average number of diluted shares

     23,906        22,991       23,953        22,923  

 

1

Results for the six months ended June 29, 2019 include changes in fair value of contingent consideration obligations associated with the Solar Implant Technology (SIT) acquisition in 2010.

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