Penguin Solutions, Inc. · NASDAQ:PENG
Penguin Solutions — SMART Global Holdings — Q1 FY2021 Earnings Presentation
19 slides from Penguin Solutions's earnings presentation, Jan 5, 2021
Slide 1: Q1 FY2021 Financial Results Conference Call
JANUARY 5, 2021 Q1 FY2021 Financial Results Conference Call
Slide 2: Disclaimer
Disclaimer This presentation and oral communications made during the course of this presentation contain "forward-looking Non-GAAP Information statements" including among other things, statements regarding future events and the future financial performance of Certain non-GAAP financial measures are
Slide 3: Speakers
Speakers Mark Adams President and CEO Business Update SMART Global Holdings Jack Pacheco Financial Review COO and CFO SMART Global Holdings and Guidance President SMART Memory Solutions Business 3
Slide 4: FY2021 Off to a Solid Start
❖ Financial Performance • Revenue, non-GAAP Gross Margin above mid-point of guidance • Exceeded high-end of guidance range for Non-GAAP EPS • Continued to strengthen balance sheet ❖ Focused on Specialty Solutions for Growth Markets FY2021 • SCSS ~ HPC, Cloud, Edge Computing, IoT • Specialty Memory &
Slide 5: Specialty Compute & Storage
❖ Launched 4 Solutions Practices to enable customer adoption of AI, HPC, Cloud & Data Analytics capabilities ❖ Released new ATCA memory blade targeted at industrial and Specialty military applications Compute & ❖ Industry recognition: Storage • HPCWire for best HPC Solution in Financial Services • I
Slide 6: Specialty Memory
❖ Strong demand for DDR3 products and NVDIMM (persistent memory) for storage applications ❖ New customers sampling SSD products using SMART’s proprietary controller Specialty ❖ Expanding into new vertical markets with customer wins in Memory surveillance and transportation ❖ Introduced new line of P
Slide 7: Brazil
❖ Achieved higher sales in notebook due to work-from-home trend ❖ Benefited from increased densities in Mobile memory in the Brazil quarter ❖ Qualified multiple high-density products for Mobile applications, including 64G and 128G eMCP ❖ Initiated manufacturing strategy for in-country SSDs 7
Slide 8: Cree LED
❖ All key elements of transaction remain on track • Remain bullish about Cree LED’s leadership position in Specialty LED • Post-close integration plan on track • Close expected in February/March timeframe Cree LED ❖ Why we remain excited about Cree LED • Aligns with SGH focus on specialty solutions,
Slide 9: CFO Financial Review
CFO Financial Review JACK PACHECO COO and CFO SMART Global Holdings President SMART Memory Solutions Business 9
Slide 10: Q1 FY2021 Financial Highlights: Met or Exceeded Expectations
Q1 FY2021 Financial Highlights: Met or Exceeded Expectations Net Sales Non-GAAP Gross Margin Non-GAAP EPS Actuals $291.7 M 18.6% $0.78 Guidance on Q4 FY2020 $290.0 M 18.5% $0.70 Earnings Call • Strong memory sales in the quarter • Strong bottom line performance driven by focus on operational excelle
Slide 11: Q1 FY2021 Net Sales by End Market
Q1 FY2021 Net Sales by End Market Industrial, Mobile Defense & Other & PCs $291.7 M Network & Servers & Telecom Storage 11
Slide 12: Q1 FY2021 Income Statement Highlights – Non-GAAP
Q1 FY2021 Income Statement Highlights – Non-GAAP Q1 FY21 Q4 FY20 Q1 FY20 Gross profit $54.1 M $57.8 M $55.7 M Gross margin 18.6% 19.5% 20.5% Gross Margin - SCSS 27% 28% 27% Gross Margin - Specialty Memory 15% 16% 19% Gross Margin - Brazil 17% 19% 18% Operating expenses $30.4 M $29.4 M $37.4M Net inc
Slide 13: Q1 FY2021 Balance Sheet Highlights
Q1 FY2021 Balance Sheet Highlights Working Capital Q4 FY20 Q1 FY21 Cash Flow Q4 FY20 Q1 FY21 Net accounts receivable $215.9 M $212.9 M Cash & equivalents $150.8 M $164.1 M Days sales outstanding 45 days 46 days CF from operations $16.2 M $35.6M Inventory $163.0 M $147.2 M LTM CF from operations $78.
Slide 14: Q2 FY2021 Guidance
Q2 FY2021 Guidance Net sales $285M to $305M Gross margin 18% to 20% GAAP EPS* $0.38 +/- $0.05 Non-GAAP EPS* $0.80 +/- $0.05 Income tax provision 10% to 14% Capital expenditures $10M to $15M *Based upon ~25.6 million diluted shares Note: Guidance does not include any view on the foreign exchange gain
Slide 15: Thank you
Thank you
Slide 16: Appendix: Non-GAAP Reconciliations
Appendix: Non-GAAP Reconciliations
Slide 17: Reconciliation of gross profit
Reconciliation of gross profit: GAAP gross profit GAAP gross margin Add: Share-based compensation included in cost of sales Add: Intangible amortization included in cost of sales Non-GAAP gross profit Non-GAAP gross margin Reconciliation of operating expenses: GAAP operating expenses Less: Share-bas
Slide 18: Reconciliation of net income and earnings per share
Reconciliation of net income and earnings per share (diluted): GAAP net income Adjustments to GAAP net income: Share-based compensation, Amortization of intangible assets Acquisition related expenses Integration/restructuring expenses Convertible debt discount OID and fees Gain on settlement of inde
Slide 19: Adjusted EBITDA reconciliation
SMART GAAP net income Share-based compensation expense Amortization of intangible assets Interest expense, net Provision for income tax Depreciation Acquisition-related expenses Integration/restructuring expenses Gain on settlement of indemnity claim a Adjusted EBITDA Three Months Ended November 27,
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