Entegris, Inc. · NASDAQ:ENTG
Entegris — Q2 2019 Earnings Presentation
20 slides from Entegris's earnings presentation, Jul 25, 2019
Slide 1: Earnings Summary Second Quarter 2019
Exhibit 99.2 Earnings Summary Second Quarter 2019 July 25, 2019
Slide 2: Safe Harbor
SAFE HARBOR This document contains, and management may make, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “forecast,” “project,” “should,” “may,” “will,” “would” or the negat
Slide 3: 2Q19 Summary
2Q19 SUMMARY o Second-quarter revenue of $378.9 million, decreased 1% from prior year o GAAP diluted EPS was $0.91 o Non-GAAP diluted EPS was $0.39 o SCEM division sequential sales growth of 2%, led by a record quarter in advanced deposition materials o Implementing operating model improvements expe
Slide 4: Summary – Consolidated Statement of Operations (GAAP)
Summary – Consolidated Statement of Operations (GAAP) 2Q19 over 2Q19 over $ in millions, except per share data 2Q19 2Q19 Guidance 1Q19 2Q18 2Q18 1Q19 Net Revenue $378.9 $375 - $390 $391.0 $383.1 (1.1%) (3.1%) Gross Margin 43.9% 45.4% 47.6% Operating Expenses $111.4 $126 - $128 $129.9 $107.4 3.6% (14
Slide 5: Summary – Consolidated Statement of Operations (Non-GAAP)
Summary – Consolidated Statement of Operations (Non-GAAP)1 2Q19 over 2Q19 over $ in millions, except per share data 2Q19 2Q19 Guidance 1Q19 2Q18 2Q18 1Q19 Net Revenue $378.9 $375 - $390 $391.0 $383.1 (1.1%) (3.1%) Adjusted Gross Margin2 44.1% 46.0% 47.7% Non-GAAP Operating $90.2 $89 - $91 $87.7 $89.
Slide 6: Results by Segment
RESULTS BY SEGMENT1 Specialty Chemicals Microcontamination Advanced and Engineered Control Segment3 Materials Handling 2 Materials Segment 4 $ in millions Segment $160 40% $160 40% $160 40% $140 $140 $140 $120 30% $120 30% $120 30% $100 $100 $100 $80 20% $80 20% $80 20% $60 $60 $60 $40 10% $40 10% $
Slide 7: Revenue by Geography: Strong growth in China and Taiwan
REVENUE BY GEOGRAPHY: Strong growth in China and Taiwan YTD19 Revenue by Geography YTD19 vs. YTD18 Growth Rate Revenue = $ million Taiwan 11% Taiwan N. America 5% N. America $147.3M $179.3M South Korea -3% Southeast Japan -6% Asia $50.9M $68.6M Europe China 14% $124.1M Europe 0% $99.9M Japan Southea
Slide 8: Summary – Balance Sheet Items
Summary – Balance Sheet Items $ in millions 2Q19 1Q19 2Q18 $ Amount % Total $ Amount % Total $ Amount % Total Cash & Cash Equivalents $521.4 21.5% $342.4 14.8% $257.1 12.7% Accounts Receivable, net $218.7 9.0% $232.1 10.0% $200.4 9.9% Inventories $261.9 10.8% $271.5 11.7% $265.4 13.1% Net PP&E $445.
Slide 9: Adjusted EBITDA Margin
ADJUSTED EBITDA MARGIN1 Adjusted EBITDA and EBITDA Margin 28.9% 27.7% 27.7% 27.7% 28.5% 27.5% 27.8% 26.8% $109 $110 $110 $109 $106 25.2% 23.9% $96 $97 $95 80 $88 $76 40 0 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 Adj. EBITDA in $M Adj. EBITDA as % of Sales 1. See Reconciliation of GAAP Incom
Slide 10: Cash Flows
Cash Flows $ in millions 2Q19 1Q19 2Q18 Beginning Cash Balance $342.4 $482.1 $550.2 Cash provided by (used in) operating activities $230.9 ($2.5) $98.3 Capital expenditures ($25.6) ($34.5) ($26.4) Acquisition of business $0.5 ($49.8) ($342.6) Payments on long-term debt ($1.0) ($1.0) ($2.0) Repurchas
Slide 11: Thoughtful and balanced capital allocation
Thoughtful and balanced capital allocation More than $3.0 billion allocated over the past 6 years1 Acquisition of ATMI in 2014 ($810M net of cash acquired), PSS, Acquisitions Saes Pure Gas, DSC and MPD continued “bolt on” acquisitions $1.5B broadened capabilities and leveraged global platform Contin
Slide 12: Entegris Updated Capital Allocation Principles
Entegris Updated Capital Allocation Principles Capital Structure Targets Capital Allocation Priorities • Minimum cash balance of approximately $200 million 1. Investments in R&D and CAPEX (globally) • ER&D: 8% of sales target • A debt rating of Ba1 or better • CAPEX: 7% of sales target 2. Value Accr
Slide 13: Outlook
Outlook GAAP $ in millions, except per share data 3Q19 Guidance 2Q19 Actual 2Q18 Actual Net Revenue $385 -$400 $378.9 $383.1 Operating Expenses $115 - $117 $111.4 $107.4 Net Income $40 - $46 $124.0 $54.3 Earnings (Per Diluted Share) $0.29 - $0.34 $0.91 $0.38 Non-GAAP $ in millions, except per share
Slide 14: Trademarks
Entegris®, the Entegris Rings Design™ and Pure Advantage™ are trademarks of Entegris, Inc. ©2016 Entegris, Inc. All rights reserved.
Slide 15: Non-GAAP Reconciliation Table: Gross Profit
Non-GAAP Reconciliation Table Reconciliation of GAAP Gross Profit to Adjusted Gross Profit Three months ended Six months ended June 29, 2019 June 30, 2018 March 30, 2019 June 29, 2019 June 30, 2018 Net Sales $378,874 $383,059 $391,047 $769,921 $750,258 Gross profit-GAAP $166,274 $182,378 $177,393 $3
Slide 16: Reconciliation of GAAP Segment Profit to Adjusted Operating Income
NON-GAAP RECONCILIATION TABLE RECONCILIATION OF GAAP SEGMENT PROFIT TO ADJUSTED OPERATING INCOME in thousands Three months ended Six months ended Segment profit-GAAP June 29, 2019 June 30, 2018 March 30, 2019 June 29, 2019 June 30, 2018 Specialty Chemicals and Engineered Materials $24,000 $36,728 $2
Slide 17: Reconciliation of GAAP to Adjusted Operating Income and Adjusted EBITDA
NON-GAAP RECONCILIATION TABLE RECONCILIATION OF GAAP TO ADJUSTED OPERATING INCOME AND ADJUSTED EBITDA Three months ended Six months ended $ in thousands June 29, 2019 June 30, 2018 March 30, 2019 June 29, 2019 June 30, 2018 Net sales $378,874 $383,059 $391,047 $769,921 $750,258 Net income $123,997 $
Slide 18: Reconciliation of GAAP to Non-GAAP Earnings Per Share
NON-GAAP RECONCILIATION TABLE RECONCILIATION OF GAAP TO NON-GAAP EARNINGS PER SHARE Three months ended Six months ended $ in thousands, except per share data June 29, 2019 June 30, 2018 March 30, 2019 June 29, 2019 June 30, 2018 GAAP net income $123,997 $54,349 $32,658 $156,655 $111,911 Adjustments
Slide 19: GAAP Segment Trend Data
GAAP Segment Trend Data1 $ in thousands Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Sales SCEM $ 114,435 $ 121,174 $ 124,522 $ 125,339 $ 130,743 $ 134,336 $ 131,234 $ 133,928 $ 124,470 $ 127,552 MC 100,195 104,587 116,229 115,801 118,923 124,937 151,478 158,500 157,706 150,185 AMH 108,371 109,
Slide 20: Non-GAAP Segment Trend Data
NON-GAAP Segment Trend Data1 $ in thousands Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Sales SCEM $ 114,435 $ 121,174 $ 124,522 $ 125,339 $ 130,743 $ 134,336 $ 131,234 $ 133,928 $ 124,470 $ 127,552 MC 100,195 104,587 116,229 115,801 118,923 124,937 151,478 158,500 157,706 150,185 AMH 108,371