EX-99.1 2 exhibit991q313earnings.htm EARNINGS PRESS RELEASE Exhibit 99.1 Q3'13 Earnings
Exhibit 99.1



Brooks Automation Reports Fiscal Third Quarter Ended June 30, 2013 Results; Announces Appointment of Mark D. Morelli as President

CHELMSFORD, Mass., August 8, 2013 (GLOBE NEWSWIRE) -- Brooks Automation, Inc. (Nasdaq:BRKS), a leading worldwide provider of automation, vacuum and instrumentation solutions for multiple markets, including semiconductor manufacturing and life sciences, today reported financial results for the third quarter and nine months ended June 30, 2013.

Fiscal Third Quarter of 2013 Financial and Operational Highlights:
•
Revenues were $118.1 Million; Order Bookings increased $6.8 million on a sequential basis to $128.1 million;
•
Brooks Life Science Systems Bookings increased to $18.5 million;
•
GAAP Earnings Per Share was $0.02; Adjusted Earnings Per Share excluding special charges was $0.03
•
Cash flow from Operations was $12.9 million;
•
Cash, Cash Equivalents and Marketable Securities as of June 30, 2013 were $150.7 million, or $2.26 per diluted share with no Debt;
•
Generated 17 Design-in-Wins for Semiconductor and Adjacent market customers.

Summary of GAAP and Non-GAAP Earnings
 
Quarter Ended
 
Nine Months Ended
000's except EPS
June 30,
 2013
 
March 31,
 2013
 
June 30,
2012
 
June 30,
 2013
 
June 30,
 2012
 
 
 
 
 
 
 
 
 
 

GAAP Net Income (Loss) attributable to Brooks
$
1,544

 
$
(538
)
 
$
8,028

 
$
(8,230
)
 
$
20,572

GAAP Diluted Earnings (Loss) per share
$
0.02

 
$
(0.01
)
 
$
0.12

 
$
(0.13
)
 
$
0.31

 
 
 
 
 
 
 
 
 
 
Adjusted Net Income (Loss) attributable to Brooks
$
1,965

 
$
600

 
$
8,943

 
$
(1,277
)
 
$
25,810

Adjusted Diluted Earnings (Loss) per Share
$
0.03

 
$
0.01

 
$
0.14

 
$
(0.02
)
 
$
0.39


A reconciliation of non-GAAP measures to the most nearly comparable GAAP measure follows the consolidated balance sheets, statements of operations and statements of cash flows included in this release.

Management Comments
“Despite flat market conditions over the quarter, we generated revenue and profits performance in line with our guidance. Cash flow generation was strong as we continued to improve gross margin and reduce inventory," said Steve Schwartz, Chief Executive Officer of Brooks. "We closed out several of the major Life Science Systems orders that were in our pipeline and we booked $18.5 million of orders in this business during the quarter. This was an important step in the recovery of this business after a period of slow spending. New leadership in the Life Science Systems business is strongly focused on working with current and prospective customers to maintain this momentum."
Dr. Schwartz continued, “We believe that further near-term growth of our front end semiconductor business is likely, however, we are uncertain as to the timing given the relatively flat order booking trends that we continue to experience. In the longer term, the continued expansion of our engagements for important new business and developing operational improvements should make our business larger and more profitable.”


Martin S. Headley, Executive Vice-President and Chief Financial Officer, commented, “Adjusted EBITDA of $12.0 million in the quarter was above our expectations for the level of revenue that we achieved. However, our net income was adversely impacted by an abnormally high effective tax rate in the quarter of 74%. For the full year we now expect a lower effective tax rate than previously projected and expect a very low effective tax rate in the fourth quarter of fiscal 2013.”
Third Quarter of Fiscal 2013 Results
Revenues for the third quarter of fiscal 2013 were $118.1 million, a 1.2% increase compared to revenues of $116.6 million in the second quarter of fiscal 2013 and $140.4 million in the third quarter of fiscal 2012. The revenues for the third quarter of fiscal 2013 reflected sequential growth in the services business and sales into industrial and adjacent markets. Product revenues into the semiconductor front end market declined 3.2% sequentially as a result of actions the Company took to exit from certain low margin business.

Revenues for the Brooks Global Services segment increased 2.9% on a sequential basis compared to the second quarter of 2013. Revenues for the Brooks Product Solutions segment increased 1.4% sequentially with growth in sales to industrial and adjacent markets. Revenues for the Brooks Life Science Systems segment declined 3.8% sequentially compared to the second quarter of 2013, with lower automated cold store revenues.

New order bookings for the third quarter of fiscal 2013 increased 5.6% sequentially to $128.1 million, compared to order bookings in the fiscal second quarter 2013 of $121.3 million.

Gross profit margin was 33.6% for the third quarter of fiscal 2013, compared to gross profit margins of 31.4% for the second quarter of fiscal 2013 and 32.9% for the third quarter of fiscal 2012. The third quarter of fiscal 2013 saw sequential margin improvements in our Global Services business as a result of cost structure improvements and in our Life Sciences business as a result of higher software and device sales.

Adjusted EBITDA (as defined in the Notes on non-GAAP measures) for the third quarter of fiscal 2013 was $12.0 million, which compared to $9.2 million in the second quarter of fiscal 2013 and $17.2 million in the third quarter of fiscal 2012.

A reconciliation of non-GAAP measures to the most nearly comparable GAAP measure follows the consolidated statements of operations, balance sheets and statements of cash flows included in this release.

Net cash provided by operating activities for the third quarter of fiscal 2013 was $12.9 million, which drove total cash, cash equivalents and marketable securities to $150.7 million at June 30, 2013.

Nine Months ended June 30, 2013 Results
Revenues for the nine months ended June 30, 2013 were $332.7 million, compared to revenues of $400.0 million for the nine months ended June 30, 2012. Net loss for the nine months ended June 30, 2013, including the impact of certain restructuring adjustments and other charges, was $(8.2) million or $(0.13) per diluted share compared to net income of $20.6 million or $0.31 per diluted share, which includes certain restructuring and other charges for the nine months ended June 30, 2012.

Quarterly Cash Dividend
The Company additionally announced that the Board of Directors has declared a dividend of $0.08 per share payable on September 27, 2013 to stockholders of record on September 6, 2013. Future dividend declarations, as well as the record and payment dates for such dividends, are subject to the final determination of the Company's Board of Directors.

Guidance for Fourth Fiscal Quarter
The Company announced revenue and earnings guidance for the fourth quarter of fiscal 2013. Revenues are expected to range between $113 and $118 million and non-GAAP earnings are expected to range between $0.02 and $0.05. Including restructuring and acquisition related charges but excluding gains on sale of a building, GAAP earnings per share is expected to be between $0.03 and $0.06 per diluted share.

Acquisition of Matrical, Inc. Completed
The Company announced that it has completed the acquisition of the assets and business of Matrical, Inc. consistent with the arrangements disclosed in the July 23, 2013 press release.


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Sale of Building
The Company announced that it has signed a definitive agreement to sell a building on its Chelmsford campus for approximately $11.4 million. The sale transaction is expected to close during the fourth fiscal quarter of 2013 on completion of customary due diligence by the buyer.

Appointment of Mark D. Morelli as Company President
The Company announced that Mark D. Morelli has been appointed to the position of President and Chief Operating Officer. He previously served as Executive Vice President and Chief Operating Officer. Mr. Morelli retains responsibility for all operating, technical and customer facing activities of the Company. Mr. Morelli joined Brooks in January, 2012.

Conference Call
Brooks management will webcast its third quarter earnings conference today at 4:30 p.m. Eastern Time to discuss the fiscal third quarter business highlights. During the call, Company management will respond to questions concerning, but not limited to, the Company's financial performance, business conditions and industry outlook. Their responses could contain information that has not been previously disclosed.

The call will be broadcast live over the Internet hosted at the Investor Relations section of Brooks' website at www.brooks.com, and will be archived online on this website for convenient on-demand replay. In addition, you may call 1-800-741-3792 (North America only) or 1-212-231-2912 to listen to the live broadcast.

About Brooks Automation, Inc.
Brooks is a leading worldwide provider of automation, vacuum and instrumentation solutions for multiple markets including semiconductor manufacturing, life sciences, and clean energy. Our technologies, engineering competencies and global service capabilities provide customers speed to market, and ensure high uptime and rapid response, which equate to superior value in their mission-critical controlled environments. Since 1978, we have been a leading partner to the global semiconductor manufacturing market and through product development initiatives and strategic business acquisitions; we have expanded our reach to meet the needs of customers in the life sciences industry, analytical & research markets and clean energy solutions. Brooks is headquartered in Chelmsford, Massachusetts, with direct operations in North America, Europe and Asia.
For more information, please visit www.brooks.com.
 
 
 
CONTACT:
  
Lynne Yassemedis
Brooks Automation, Inc.
978-262-4443
lynne.yassemedis@brooks.com
 
 
 
  
John Mills
Senior Managing Director
ICR, LLC
310-954-1105
john.mills@icrinc.com

Forward Looking Statements
Some statements in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27 of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are neither promises nor guarantees but involve risks and uncertainties, both known and unknown, that could cause Brooks' financial and business results to differ materially from our expectations. They are based on the facts known to management at the time they are made. These forward-looking statements include statements regarding our revenue and operating margin expectations, our ability to develop further our business in new and adjacent markets, and our ability to achieve financial success in the future. Factors that could cause results to differ from our expectations include the following: volatility of the industries the Company serves, particularly the semiconductor industry; our possible inability to meet demand for our products due to difficulties in obtaining components and materials from our suppliers in required quantities and of required quality; the inability of customers to make payments to us when due; the timing and effectiveness of cost reduction and cost control measures; price competition; disputes concerning intellectual property; continuing uncertainties in global political and economic conditions, and other factors and other risks that we have described in our filings with the Securities and Exchange Commission, including but not limited to our Annual Report on Form 10-K, current reports on Form 8-K and our quarterly reports on Form 10-Q. As a result we can provide no assurance that our future results will not

3

be materially different from those projected. Brooks expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statement to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based. Brooks undertakes no obligation to update the information contained in this press release.

4


BROOKS AUTOMATION, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands, except share and per share data)
 
June 30,
2013
 
September 30,
2012
Assets
 
 
 
Current assets
 
 
 
Cash and cash equivalents
$
61,888

 
$
54,639

Restricted cash
—

 
763

Marketable securities
41,199

 
85,646

Accounts receivable, net
86,286

 
78,855

Inventories
92,800

 
102,985

Deferred tax assets
16,725

 
15,531

Prepaid expenses and other current assets
12,454

 
9,070

Total current assets
311,352

 
347,489

Property, plant and equipment, net
55,417

 
64,478

Long-term marketable securities
47,639

 
59,946

Long-term deferred tax assets
96,068

 
104,626

Goodwill
114,893

 
88,440

Intangible assets, net
61,821

 
39,400

Equity investment in joint ventures
23,582

 
31,428

Other assets
9,658

 
6,153

Total assets
$
720,430

 
$
741,960

Liabilities and equity
 
 
 
Current liabilities
 
 
 
Accounts payable
$
31,162

 
$
28,988

Deferred revenue
16,262

 
9,986

Accrued warranty and retrofit costs
7,704

 
7,329

Accrued compensation and benefits
15,047

 
14,118

Accrued restructuring costs
1,802

 
2,098

Accrued income taxes payable
198

 
1,699

Accrued expenses and other current liabilities
11,881

 
16,973

Total current liabilities
84,056

 
81,191

Income taxes payable
7,563

 
6,356

Long-term pension liability
1,441

 
1,688

Other long-term liabilities
3,538

 
3,424

Total liabilities
96,598

 
92,659


 
 
 
Equity
 
 
 
Preferred stock, $0.01 par value, 1,000,000 shares authorized, no shares issued or outstanding
—

 
—

Common stock, $0.01 par value, 125,000,000 shares authorized, 79,926,322 shares issued and 66,464,453 shares outstanding at June 30, 2013, 79,790,557 shares issued and 66,328,688 shares outstanding at September 30, 2012
799

 
798

Additional paid-in capital
1,822,531

 
1,817,706

Accumulated other comprehensive income
17,431

 
23,642

Treasury stock at cost, 13,461,869 shares
(200,956
)
 
(200,956
)
Accumulated deficit
(1,016,676
)
 
(992,524
)
Total Brooks Automation, Inc. stockholders’ equity
623,129

 
648,666

Noncontrolling interest in subsidiaries
703

 
635

Total equity
623,832

 
649,301

Total liabilities and equity
$
720,430

 
$
741,960



5

BROOKS AUTOMATION, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except per share data)
 
 
 
 
 
 
 
Three months ended
June 30,
 
Nine months ended
June 30,
 
2013
 
2012
 
2013
 
2012
Revenues
 
 
 
 
 
 
 
Product
$
95,547

 
$
119,172

 
$
268,363

 
$
333,891

Services
22,525

 
21,265

 
64,353

 
66,111

Total revenues
118,072

 
140,437

 
332,716

 
400,002

Cost of revenues
 
 
 
 
 
 
 
Product
64,399

 
77,821

 
183,034

 
217,553

Services
13,987

 
16,376

 
44,226

 
47,570

Total cost of revenues
78,386

 
94,197

 
227,260

 
265,123

Gross profit
39,686

 
46,240

 
105,456

 
134,879

Operating expenses
 
 
 
 
 
 
 
Research and development
12,136

 
11,691

 
35,684

 
36,169

Selling, general and administrative
22,600

 
25,344

 
73,332

 
76,356

Restructuring and other charges
560

 
880

 
6,086

 
1,125

In-process research and development
—

 
—

 
—

 
3,026

Total operating expenses
35,296

 
37,915

 
115,102

 
116,676

Operating income (loss)
4,390

 
8,325

 
(9,646
)
 
18,203

Interest income
255

 
292

 
795

 
844

Interest expense
—

 
(5
)
 
(1
)
 
(12
)
Other income, net
387

 
202

 
371

 
497

Income (loss) before income taxes and equity in earnings of joint ventures
5,032

 
8,814

 
(8,481
)
 
19,532

Income tax provision (benefit)
3,700

 
985

 
(99
)
 
626

Income (loss) before equity in earnings of joint ventures
1,332

 
7,829

 
(8,382
)
 
18,906

Equity in earnings of joint ventures
236

 
196

 
220

 
1,676

Net income (loss)
$
1,568

 
$
8,025

 
(8,162
)
 
20,582

Net (income) loss attributable to noncontrolling interests
(24
)
 
3

 
(68
)
 
(10
)
Net income (loss) attributable to Brooks Automation, Inc.
$
1,544

 
$
8,028

 
(8,230
)
 
20,572

Basic net income (loss) per share attributable to Brooks Automation, Inc. common stockholders
$
0.02

 
$
0.12

 
$
(0.13
)
 
$
0.32

Diluted net income (loss) per share attributable to Brooks Automation, Inc. common stockholders
$
0.02

 
$
0.12

 
$
(0.13
)
 
$
0.31

Shares used in computing earnings (loss) per share
 
 
 
 
 
 
 
Basic
66,041

 
65,264

 
65,831

 
65,038

Diluted
66,687

 
65,781

 
65,831

 
65,677



6

BROOKS AUTOMATION, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(In thousands)
 
Nine months ended June 30,
 
2013
 
2012
Cash flows from operating activities
 
 
 
Net income (loss)
$
(8,162
)
 
$
20,582

Adjustments to reconcile net income (loss) to net cash provided by operating activities:
 
 
 
Depreciation and amortization
18,258

 
16,159

Stock-based compensation
5,625

 
6,903

Amortization of premium on marketable securities
972

 
1,804

Undistributed earnings of joint ventures
(220
)
 
(1,676
)
Deferred income tax benefit
(364
)
 
—

Pension settlement
87

 
—

Loss (gain) on disposal of long-lived assets
375

 
(62
)
Changes in operating assets and liabilities, net of acquisitions and disposals:
 
 
 
Accounts receivable
(3,508
)
 
(10,007
)
Inventories
17,334

 
961

Prepaid expenses and other current assets
(1,585
)
 
(1,141
)
Accounts payable
(758
)
 
6,496

Deferred revenue
6,351

 
(3,625
)
Accrued warranty and retrofit costs
(1,194
)
 
(72
)
Accrued compensation and benefits
(211
)
 
(3,869
)
Accrued restructuring costs
(579
)
 
465

Accrued expenses and other current liabilities
(2,784
)
 
(344
)
Net cash provided by operating activities
29,637

 
32,574

Cash flows from investing activities
 
 
 
Purchases of property, plant and equipment
(2,710
)
 
(6,364
)
Purchases of marketable securities
(72,581
)
 
(93,306
)
Sale/maturity of marketable securities
127,582

 
96,499

Acquisition, net of cash acquired
(59,005
)
 
(8,716
)
Other investment
—

 
(3,000
)
Proceeds from the sale of property, plant and equipment
3,169

 
—

Payment of deferred leasing cost
(3,134
)
 
—

Decrease in restricted cash
763

 
531

Net cash used in investing activities
(5,916
)
 
(14,356
)
Cash flows from financing activities
 
 
 
Proceeds from issuance of common stock, net of issuance costs
969

 
841

Common stock dividend paid
(15,987
)
 
(15,719
)
Net cash used in financing activities
(15,018
)
 
(14,878
)
Effects of exchange rate changes on cash and cash equivalents
(1,454
)
 
(609
)
Net increase in cash and cash equivalents
7,249

 
2,731

Cash and cash equivalents, beginning of period
54,639

 
58,833

Cash and cash equivalents, end of period
$
61,888

 
$
61,564


7

Notes on Non-GAAP Financial Measures:
The information in this press release is for: internal managerial purposes; when publicly providing guidance on future results; and as a means to evaluate period-to-period comparisons. These financial measures are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. Management believes these financial measures provide an additional way of viewing aspects of our operations, that, when viewed with our GAAP results and the accompanying reconciliations to the corresponding GAAP financial measures, provide a more complete understanding of our business. Management strongly encourages investors to review our financial statements and publicly-filed reports in their entirety and not rely on any single measure.

The press release includes financial measures which exclude the effects of non-recurring income and special charges such as restructuring charges and acquisition related charges. Management believes these measures are useful to investors because it eliminates accounting charges that do not reflect Brooks' day-to-day operations. A table reconciling income (loss) and diluted earnings (loss) per share from operations is presented below.
 
 
 
 
 
Quarter ended
 
 
 
 
 
June 30, 2013
 
March 31, 2013
 
June 30, 2012
 
$
 
per share
 
$
 
per share
 
$
 
per share
Net income (loss) attributable to Brooks Automation, Inc.
$
1,544

 
$
0.02

 
$
(538
)
 
$
(0.01
)
 
$
8,028

 
$
0.12

Adjustments, net of tax:
 
 
 
 
 
 
 
 
 
 
 
Purchase accounting impact on inventory and contracts acquired
—

 
—

 
579

 
0.01

 
35

 
0.00

Restructuring charges
379

 
0.01

 
553

 
0.01

 
880

 
0.01

Merger costs
42

 
0.00

 
6

 
0.00

 
—

 
—

Adjusted net income attributable to Brooks Automation, Inc.
1,965

 
0.03

 
600

 
0.01

 
8,943

 
0.14

Stock-based compensation
615

 
0.01

 
2,499

 
0.04

 
1,979

 
0.03

Adjusted net income attributable to Brooks Automation, Inc. - excluding stock-based compensation
$
2,580

 
$
0.04

 
$
3,099

 
$
0.05

 
$
10,922

 
$
0.17

 
 
 
 
 
 
 
 
 
 
 
 
 
Nine months ended
 
 
 
 
 
June 30, 2013
 
June 30, 2012
 
 
 
 
 
$
 
per share
 
$
 
per share
 
 
 
 
Net income (loss) attributable to Brooks Automation, Inc.
$
(8,230
)
 
$
(0.13
)
 
$
20,572

 
$
0.31

 
 
 
 
Adjustments, net of tax:
 
 
 
 
 
 
 
 
 
 
 
Purchase accounting impact on inventory and contracts acquired
2,092

 
0.03

 
866

 
0.01

 
 
 
 
Restructuring charges
4,357

 
0.07

 
1,125

 
0.02

 
 
 
 
Merger costs
504

 
0.01

 
221

 
0.00

 
 
 
 
In-process research and development acquired
—

 
—

 
3,026

 
0.05

 
 
 
 
Adjusted net income (loss) attributable to Brooks Automation, Inc.
(1,277
)
 
(0.02
)
 
25,810

 
0.39

 
 
 
 
Stock-based compensation
5,625

 
0.09

 
6,903

 
0.11

 
 
 
 
Adjusted net income attributable to Brooks Automation, Inc. - excluding stock-based compensation
$
4,348

 
$
0.07

 
$
32,713

 
$
0.50

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter ended
 
June 30, 2013
 
March 31, 2013
 
June 30, 2012
 
$
 
%
 
$
 
%
 
$
 
%
Gross profit / gross margin percentage
$
39,686

 
33.6
%
 
$
36,612

 
31.4
%
 
$
46,240

 
32.9
%
Adjustments:
 
 
 
 
 
 
 
 
 
 
 
Purchase accounting impact on inventory and contracts acquired
—

 
—
%
 
805

 
0.7
%
 
35

 
0.0
%

Adjusted gross profit / gross margin percentage
$
39,686

 
33.6
%
 
$
37,417

 
32.1
%
 
$
46,275

 
33.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended
 
 
 
 
 
June 30, 2013
 
June 30, 2012
 
 
 
 
 
$
 
%
 
$
 
%
 
 
 
 
Gross profit / gross margin percentage
$
105,456

 
31.7
%
 
$
134,879

 
33.7
%
 
 
 
 
Adjustments:
 
 
 
 
 
 
 
 
 
 
 
Purchase accounting impact on inventory and contracts acquired
2,907

 
0.9
%
 
866

 
0.2
%
 
 
 
 

Adjusted gross profit / gross margin percentage
$
108,363

 
32.6
%
 
$
135,745

 
33.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

8

 
Quarter ended
 
Nine months ended
 
 
 
June 30,
 
March 31,
 
June 30,
 
June 30,
 
June 30,
 
 
 
2013
 
2013
 
2012
 
2013
 
2012
 
 
Net income (loss) attributable to Brooks Automation, Inc.
$
1,544

 
$
(538
)
 
$
8,028

 
$
(8,230
)
 
$
20,572

 
 

Less: Interest income
(255
)
 
(265
)
 
(292
)
 
(795
)
 
(844
)
 
 
Add: Interest expense
—

 
—

 
5

 
1

 
12

 
 
Add: Income tax provision (benefit)
3,700

 
(129
)
 
985

 
(99
)
 
626

 
 
Add: Depreciation
3,374

 
3,548

 
3,466

 
10,626

 
10,008

 
 
Add: Amortization of completed technology
1,042

 
1,041

 
936

 
3,268

 
2,660

 
 
Add: Amortization of customer relationships and acquired intangible assets
1,399

 
1,413

 
1,136

 
4,364

 
3,491

 
 
Add: Stock-based compensation
615

 
2,499

 
1,979

 
5,625

 
6,903

 
 
Add: Restructuring charges
560

 
769

 
880

 
6,086

 
1,125

 
 
Add: Purchase accounting impact on inventory and contracts acquired
—

 
805

 
35

 
2,907

 
866

 
 
Add: Merger costs
62

 
8

 
—

 
704

 
221

 
 
Add: In-process research and development acquired
—

 
—

 
—

 
—

 
3,026

 
 

Adjusted EBITDA
$
12,041

 
$
9,151

 
$
17,158

 
$
24,457

 
$
48,666

 
 



9