Photronics, Inc. (PLAB) has reported an 84.84 percent plunge in profit for the quarter ended Apr. 30, 2017. The company has earned $1.80 million, or $0.03 a share in the quarter, compared with $11.85 million, or $0.16 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $1.80 million, or $0.03 a share compared with $8.85 million or $0.13 a share, a year ago.
Revenue during the quarter dropped 11.90 percent to $108.30 million from $122.92 million in the previous year period. Gross margin for the quarter contracted 684 basis points over the previous year period to 18.61 percent. Total expenses were 94.89 percent of quarterly revenues, up from 87.95 percent for the same period last year. That has resulted in a contraction of 694 basis points in operating margin to 5.11 percent.
Operating income for the quarter was $5.54 million, compared with $14.82 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $24.73 million compared with $33.84 million in the prior year period. At the same time, adjusted EBITDA margin contracted 469 basis points in the quarter to 22.84 percent from 27.53 percent in the last year period.
"Second quarter revenues were essentially flat compared with the first quarter as improving display photomask sales were offset by a decline in our high-end logic business in Taiwan," said Peter Kirlin, chief executive officer. "FPD sales improved 10% driven by strengthening demand for mainstream masks. IC sales were down, primarily due to weak 28 nm demand in Taiwan. Operating margin decreased mainly due to a drop in gross margin as a result of an unfavorable product mix. We were able to generate cash, building upon our already strong balance sheet. Strategically, we achieved three important milestones since our first quarter report: the first of two new writing tools is being installed to add FPD capacity; construction began on our new China IC facility; and this morning we announced a new joint venture in China."
For the third-quarter 2017, Photronics, Inc. expects revenue to be in the range of $110 million to $120 million. The company projects diluted earnings per share to be in the range of $0.05 to $0.12.
Operating cash flow drops significantly
Photronics, Inc. has generated cash of $46.91 million from operating activities during the first half, down 27.99 percent or $18.23 million, when compared with the last year period.
The company has spent $19.85 million cash to meet investing activities during the first six months as against cash outgo of $25.95 million in the last year period.
The company has spent $0.41 million cash to carry out financing activities during the first six months as against cash outgo of $51.92 million in the last year period.
Cash and cash equivalents stood at stood at $345.72 million as at Apr. 30, 2017.
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