Brooks Automation, Inc. 1st Quarter Fiscal2014 Financial Results Conference Call February 6, 2014
Safe Harbor Statement Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995; certain matters in this presentation, including forecasts of future demand and future Company performance, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to materially differ, either better or worse, from those projected. Further discussions sof risk factors are available a ab in the Company s most recent SEC filings including Form 10-K for the fiscal year ended September 30, 2013. The Company assumes no obligation to update the information in this presentation. Regulation G This presentation contains certain non-gaap measures which are provided to assist in an understanding of the Brooks business and its operational performance. These measures should always be considered in conjunction with the appropriate GAAP measure. Reconciliations of all non-gaap amounts to the relevant GAAP amount are provided in either an attachment to our first quarter financial results press release issued on February 6, 2014 or as an attachment to call slides used to accompany prepared comments made during our financial results conference call of the same date. Both documents are available on our website at www.brooks.com. 2
Sequential Growth With Margin Expansion $ millions Q4 FY13 Q1 FY14 Change Revenue $ 118.2 $ 124.6 $ 6.4 Gross profit * 43.6 46.4 2.8 Gross margin % * 36.9% 37.2% 0.3% Research & development 13.3 13.2 0.1 Selling, general & administrative * 24.5 25.3 (0.8) Operating Income * $58 5.8 $79 7.9 $21 2.1 3 * Non GAAP measure. See Appendix to this presentation for a reconciliation to the appropriate GAAP measure.
GAAP and Adjusted Earnings $ millions, except per share amounts Q4FY13 Q1FY14 Change Revenues $ 118.2 $ 124.6 $ 6.4 Operating income * 5.8 7.9 2.1 Amortization (2.5) (2.6) (0.1) Special charges* (2.7) (1.4) 1.3 Other income (expense), net 1.1 0.5 (0.6) Income tax provision (benefit) (2.1) 1.7 (3.8) Minorities & joint venture earnings 2.2 0.7 (1.5) GAAP Net income attributable to Brooks $ 6.0 $ 3.4 $ (2.6) GAAP Diluted Earnings per Share $ 0.09 $ 0.05 $ (0.04) Non-GAAP Diluted Earnings per Share* $ 0.13 $ 0.09 $ (0.04) 4 * Non GAAP measure. See Appendix to this presentation for a reconciliation to the appropriate GAAP measure.
Fiscal 2014 Q1 Cash and Cash Flow $ millions Adjusted EBITDA * $ 14.8 Working Capital movements (3.6) Other operating items (2.7) Cash Flow from Operations 8.5 Capital expenditures (1.0) Dividends (5.4) Other 0.2 Net Change in Cash and Marketable Securities 2.3 Cash and Marketable Securities at December 31, 2013 $ 175.7 7 5 * Non GAAP measure. See Appendix to this presentation for a reconciliation to the appropriate GAAP measure.
December 31, 2013 Condensed Balance Sheet CASH & MARKETABLE SECURITIES $ 176 $ Millions Balance Sheet Highlights Accounts Receivable, net 76 Net working capital increased $4 million with reduced I t i 97 accounts payable Inventories 97 Accounts payable (31) Deferred revenue (17) Other current assets (liabilities), net (13) Net Working Capital 112 Net fixed assets 46 Goodwill & other intangible assets 179 Other assets (liabilities), net 120 Shareholders Equity $ 633 Days sales outstanding of 55 days; 59 in Q4 3.3 Inventory turns; 3.2 in Q4 $1 million of Cap-ex in the quarter 6
Brooks Product Solutions - Sequential Performance $ millions Q4FY13 Q1FY14 Comments on Sequential Trends Revenue $ 83.2 $ 88.7 7% sequential revenue growth; 21% increase in Semi Front End Gross Profit * 31.3 32.5 Operating Expenses 24.5 25.5 1 pt gross margin reduction in line with expectations as reserve adjustments t benefited the prior quarter Segment Operating Income * $ 6.8 $ 7.0 7 * Non GAAP measure. See Appendix to this presentation for a reconciliation to the appropriate GAAP measure.
Brooks Global Services - Sequential Performance $ millions Q4FY13 Q1FY14 Comments on Sequential Trends Revenue $ 23.7 $ 23.7 Flat revenue and gross margin performance in line with expectations Gross Profit * 8.1 8.2 ~ 5pt improvement in gross margin vs Q1 13 Operating Expenses 4.3 5.0 Segment Operating Income * $ 3.8 $ 3.2 8 * Non GAAP measure. See Appendix to this presentation for a reconciliation to the appropriate GAAP measure.
Brooks Life Science Systems - Sequential Performance $ millions Q4FY13 Q1FY14 Comments on Sequential Trends Revenue $ 11.3 $ 12.2 8% sequential growth Gross Profit * 4.2 5.7 $19.9 million of new orders Operating Expenses 7.7 8.0 9.3 pt. improvement in gross margin Segment Operating Income * $ (3.5) $ (2.3) Performance in line with expectations 9 * Non GAAP measure. See Appendix to this presentation for a reconciliation to the appropriate GAAP measure.
Revenue, EBITDA & Earnings Guidance $ millions, except per share amounts Q1FY14 Q2FY14 Comments on Sequential Trends Revenues $ 124.6 $ 126 - $ 130 Adjusted EBITDA* $ 14.8 $ 12.5 - $ 15.0 Non-GAAP Diluted Earnings Per Share* GAAP Diluted Earnings Per Share $ 0.09 $ 0.05 -$ 0.09 $ 0.05 $0.02 - $0.05 Continued growth in Semi Front End Sustained gross margins with higher h OPEX and lower joint venture income OPEX to return to levels similar to Q1 by Q3 10 * Non GAAP measure. See Appendix to this presentation for a reconciliation to the appropriate GAAP measure. 10
Brooks Automation, Inc. 1st Quarter Fiscal 2014 Financial Results Conference Call GAAP to Non GAAP Reconciliations February 6, 2014 11
GAAP to Non-GAAP Reconciliation Consolidated P&L Three Months Ended September 30, 2013 Three Months Ended December 31, 2013 In millions, except per share data GAAP Results Adjustment Non-GAAP Results GAAP Results Adjustment Non-GAAP Results Revenue $ 118.2 $ - 118.2 $ 124.6 $ - 124.6 Cost of revenue 77.7 (3.1) 74.6 79.9 (1.8) 78.1 Gross profit 40.5 3.1 43.6 44.7 1.8 46.5 Operating expenses Research and development 13.3-13.3 13.2-13.2 Selling, general and administrative 26.2 (1.7) 24.5 26.8 (1.4) 25.4 Restructuring charges 0.4 (0.4) - 0.7 (0.7) - Total operating expenses 39.9 (2.1) 37.8 40.7 (2.1) 38.6 Operating income 0.6 5.2 5.8 3.9 3.9 7.9 Interest income, net 0.2-0.2 0.2-0.2 Other income (expense), net 0.9 (1.0) (0.1) 0.3-0.3 Income before income taxes and equity in earnings of joint ventures 1.7 4.2 5.9 4.4 3.9 8.4 Income tax provision (benefit) (2.1) 1.4 (0.7) 1.7 1.3 3.0 Income before equity in earnings of joint ventures 3.8 2.8 6.6 2.7 2.6 5.4 Equity in earnings of joint ventures 2.2-2.2 0.7-0.7 Net income 6.0 2.8 8.8 3.4 2.6 6.1 Net income attributable to noncontrolling interests - - - - - - Net income attributable to Brooks Automation, Inc. $ 6.0 $ 2.8 $ 8.8 $ 3.4 $ 2.6 $ 6.1 Net income per share attributable to Brooks Automation, Inc. common stockholders Basic $ 0.09 $ 0.13 $ 0.05 $ 0.09 Diluted $ 0.09 $ 0.13 $ 0.05 $ 0.09 Shares used in computing earnings per share Basic 66,153 66,153 66,355 66,355 Diluted 66,902 66,902 67,126 67,126 12 Adjustments: Cost of revenues: Amortization of completed technology intangible assets $ (1.1) $ (1.2) Impairment of completed technology intangible assets (1.9) (0.4) Purchase accounting impact on inventory and contracts acquired (0.1) (0.2) $ (3.1) $ (1.8) Operating expenses: Amortization of customer relationships intangible assets $ (1.4) $ (1.4) Impairment of customer relationships intangible assets (0.1) - Restructuring charges (0.4) (0.7) Merger costs (0.2) - $ (2.1) $ (2.1) Other income, net: Gain on sale of building $ (1.0) $ - Tax impact of non-gaap adjustments $ 1.4 $ 1.3
GAAP to Non-GAAP Reconciliation Segments Adjustments: Amortization of completed technology $ (0.4) $ (0.2) $ (0.5) Impairment of completed technology - - (0.4) Purchase accounting impact on inventory and contracts acquired - - (0.2) $ (0.4) $ (0.2) $ (1.1) Quarter Ended December 31, 2013 Brooks Product Solutions Brooks Global Services Brooks Life Science Systems Non- Non- Non- In millions GAAP Adjustment GAAP GAAP Adjustment GAAP GAAP Adjustment GAAP Revenue $ 88.7 $ - $ 88.7 $ 23.7 $ - $ 23.7 $ 12.2 $ - $ 12.2 Cost of revenue 56.6 (0.4) 56.2 15.7 (0.2) 15.5 7.6 (1.1) 6.5 Gross profit 32.1 0.4 32.5 8.0 0.2 8.2 4.6 1.1 5.7 Operating expenses 25.5-25.5 4.9-4.9 8.1-8.1 Operating income $ 6.6 $ 0.4 $ 7.0 $ 3.1 $ 0.2 $ 3.3 $ (3.5) $ 1.1 $ (2.4) Quarter Ended September 30, 2013 Brooks Product Solutions Brooks Global Services Brooks Life Science Systems Non- Non- Non- In millions GAAP Adjustment GAAP GAAP Adjustment GAAP GAAP Adjustment GAAP Revenue $ 83.2 $ - $ 83.2 $ 23.7 $ - $ 23.7 $ 11.3 $ - $ 11.3 Cost of revenue 52.3 (0.4) 51.9 15.8 (0.2) 15.6 9.6 (2.5) 7.1 Gross profit 30.9 0.4 31.3 7.9 0.2 8.1 1.7 2.5 4.2 Operating expenses 24.5-24.5 4.3-4.3 7.7-7.7 Operating income $ 6.4 $ 0.4 $ 6.8 $ 3.6 $ 0.2 $ 3.8 $ (6.0) $ 2.5 $ (3.5) Adjustments: Amortization of completed technology $ (0.4) $ (0.2) $ (0.5) Impairment of completed technology - - (1.9) Purchase accounting impact on inventory and contracts acquired - - (0.1) $ (0.4) $ (0.2) $ (2.5) 13
GAAP to Non-GAAP Reconciliation Adjusted EBITDA Three Months Ended December 31, In millions 2013 Net income attributable to Brooks Automation, Inc. $ 3.4 Less: Interest income (0.2) Add: Income tax provision 1.7 Add: Depreciation 32 3.2 Add: Amortization of completed technology 1.1 Add: Impairment of completed technology 0.4 Add: Amortization of customer relationships and acquired intangible assets 1.5 Add: Stock-based compensation 2.8 Add: Restructuring charges 0.7 Add: Purchase accounting impact on inventory and contracts acquired 0.2 Adjusted EBITDA $ 14.8 14