New Dragonfly™ G2 system sales supported second quarter revenue growth
WILMINGTON, MASSACHUSETTS (July 30, 2019) – Rudolph Technologies, Inc. (NYSE: RTEC), a leading provider of semiconductor process control systems and lithography equipment, as well as process control and yield management software for wafer fabs and advanced packaging facilities, today announced financial results for the 2019 second quarter.
2019 Second Quarter Highlights
Second Quarter 2019 GAAP Financial Results
Second quarter revenue totaled $61.5 million, an increase of 1% compared with $60.9 million for the first quarter of 2019. Gross profit margin was 51.9% of revenues in the second quarter of 2019, a slight decrease from 52.6% in the first quarter of 2019. The decrease in gross profit margin was driven mainly by product mix.
Operating expenses for the second quarter of 2019 totaled $26.5 million, compared to $24.4 million in the first quarter of 2019. Operating expenses represented 43% of revenue in the 2019 second quarter compared to 40% of revenue in the first quarter of 2019. The increase in operating expenses over the prior quarter was primarily due to expenses related to our recently announced pending merger with Nanometrics Incorporated.
GAAP net income for the second quarter of 2019 was $5.5 million, or $0.18 per diluted share, compared with net income of $7.6 million, or $0.24 per diluted share, for the 2019 first quarter. The decrease in GAAP net income over the prior quarter was due to the higher operating expenses, partially offset by a lower tax rate in the quarter.
Second Quarter Non-GAAP Financial Results
Second quarter 2019 non-GAAP net income was $9.0 million, or $0.29 per diluted share detailed in the attached table. First quarter of 2019 non-GAAP net income was $9.6 million, or $0.31 per diluted share. Non-GAAP results exclude merger related expenses, share-based compensation expense and the amortization of intangible assets.
Outlook & Conference Call On June 24, 2019 Rudolph Technologies, Inc. and Nanometrics Incorporated announced that they had agreed to combine in an all-stock merger of equals transaction. In light of this pending merger transaction, Rudolph will not hold a conference call to discuss its financial results and has discontinued providing guidance until the merger is completed.
Discussion of Non-GAAP Financial Measures
The Company has provided in this release non-GAAP financial information including non-GAAP gross profit, operating income, net income, and net income per diluted share, as a supplement to the condensed consolidated financial statements, which are prepared in accordance with generally accepted accounting principles (“GAAP”). Management uses these non-GAAP financial measures internally in analyzing the Company’s financial results to assess operational performance. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning, forecasting and analyzing future periods. Further, the Company believes these non-GAAP financial measures are useful to investors because they allow for greater transparency with respect to key financial metrics that the Company uses in making operating decisions and because the Company believes that investors and analysts use them to help assess the health of its business and for comparison to other companies. Non-GAAP results are presented for supplemental informational purposes only for understanding the Company’s operating results. The non-GAAP information should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from non-GAAP measures used by other companies.
The financial statements provided with this release include a reconciliation of the non-GAAP financial measures to those measures reported in accordance with GAAP.
The Company’s non-GAAP financial measures, used in this press release, reflect adjustments based on the following items:
Merger related expenses. These expenses are associated with fees for services of attorneys and financial advisors related to the merger with Nanometrics Incorporated. The Company excludes merger related expenses from its non-GAAP measures primarily because the Company does not believe such expenses are reflective of ongoing operating results and allows management and investors to consider the ongoing operations of the business both with and without such expenses.
Share-based compensation expense. These expenses relate to employee restricted stock units and employee stock options. The Company excludes stock-based compensation expense from its non-GAAP measures primarily because such expenses are non-cash expenses that the Company does not believe are reflective of ongoing operating results.
Amortization of intangibles. The Company incurs expenses for the amortization of intangible assets acquired in acquisitions. The Company excludes these items because these expenses are not reflective of ongoing operating results in the period incurred. These amounts arise from the Company’s prior acquisitions and have no direct correlation to the operation of the Company’s core business.
Net tax provision (benefit) adjustments. This line item represents the income tax effects of the non-GAAP items.
About Rudolph Technologies
Rudolph Technologies, Inc. is a leader in the design, development, manufacture and support of defect inspection, lithography, process control metrology, and process control software used by semiconductor and advanced packaging device manufacturers worldwide. Rudolph delivers comprehensive solutions throughout the fab with its families of proprietary products that provide critical yield-enhancing information, enabling microelectronic device manufacturers to drive down costs and time to market of their devices. Headquartered in Wilmington, Massachusetts, Rudolph supports its customers with a worldwide sales and service organization. Additional information can be found on the Company’s website at www.rudolphtech.com.
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Senior Director, Corp. Communications