Penguin Solutions, Inc. · NASDAQ:PENG
Penguin Solutions — SMART Global Holdings — Q3 FY2021 Earnings Presentation
20 slides from Penguin Solutions's earnings presentation, Jul 6, 2021
Slide 1: Q3 FY2021 Financial Results Conference Call
Q3 FY2021 Financial Results Conference Call July 6, 2021
Slide 2: Disclaimer
Disclaimer This presentation and oral communications made during the course of this presentation contain "forward- Non-GAAP Financial Measures looking statements" including among other things, statements regarding future events and the future financial performance of SMART Global Holdings, Inc. (“SG
Slide 3: Speakers
Mark Adams President and CEO SMART Global Holdings AGENDA Speakers A new chapter for SGH Ken Rizvi SVP and CFO SMART Global Holdings 3
Slide 4: Executing Across All Fronts; Record Quarterly Revenue
Executing Across All Fronts; Record Quarterly Revenue Growth Diversification Reported Guidance* 22% Memory Solutions Net Sales $437.7M $400-$430M LED Solutions Non-GAAP Gross 55% 21.9% 19-21% Margin Intelligent Platform Solutions 23% Non-GAAP EPS $1.39 $1.00-$1.20 *Guidance provided on Q2 FY21 Earni
Slide 5: Intelligent Platform Solutions
• Revenue of ~$96M Performance o Up 12% sequentially o Up 57% year-over-year • New platforms and solutions for Core/Data Product Center/Cloud Intelligent Platform Solutions Roadmap o Penguin Computing’s OriginAI Positioned to Execute o Penguin Edge’s high-performance server card • New wins with U.S.
Slide 6: Memory Solutions
• Revenue of ~$240M; up 10% Q/Q Performance • Non-GAAP gross margin of 18.1%; up 240bp Q/Q • Strong controller-based product demand; FLASH backlog building Growth Memory Solutions • Production orders begin in; cyber security, Solid Execution personal security and transportation • Strong PC/server de
Slide 7: LED Solutions
• Revenue of $102M Performance • Non-GAAP gross margin of 29.6% Manufacturing • Silicon carbide to sapphire LED Solutions Transformation • Migration to fab-lite model Exceeding Expectations • Specialty lighting Differentiated • Video screens Markets • Horticultural 7
Slide 8: Financial Review
Financial Review Ken Rizvi | SVP and CFO 8
Slide 9: Q3 FY2021 Financial Highlights
Q3 FY2021 Financial Highlights Record performance exceeding Non-GAAP Non-GAAP Q3 guidance on all fronts Net Sales Gross Margin EPS • 44% sequential revenue growth drove record quarterly revenue Actuals $437.7M 21.9% $1.39 • Strong sequential gross margin improvement • Non-GAAP EPS up 60% Q3 Guide* $
Slide 10: Q3 FY2021 Non-GAAP Income Statement Highlights
Q3 FY2021 Non-GAAP Income Statement Highlights Q3 FY20 Q2 FY21 Q3 FY21 Net sales $281.3M $304.0M $437.7M Gross profit $55.9 $59.3 $95.7 Gross margin 19.9% 19.5% 21.9% Gross Margin – Intelligent Platform Solutions 24.5% 29.3% 23.1% Gross Margin – Memory Solutions 18.5% 15.7% 18.1% Gross Margin – LED
Slide 11: Q3 FY2021 Net Sales by End Market
Q3 FY2021 Net Sales by End Market Mobile & PCs 23% 24% Network & Telecom Servers & Storage 15% Industrial, Defense & Other 26% 12% Advanced Lighting
Slide 12: Q3 FY2021 Balance Sheet Highlights
Q3 FY2021 Balance Sheet Highlights Working Q2 Q3 Cash Q2 Q3 Q2 Q3 CapEx Capital FY21 FY21 Flow FY21 FY21 FY21 FY21 Net Accounts Cash & CapEx $20.0 M $5.2 M $203.4M $274.9M $139.8M* $189.0M Receivable Equivalents Depreciation $5.4 M $9.1 M Days Sales CF from 41 days 39 days $20.4M $49.3M Outstanding
Slide 13: Q4 FY2021 Guidance
Q4 FY2021 Guidance Q4 FY21 Guidance Net Sales $440 to $480M Gross Margin 22% to 24% Diluted EPS - GAAP $0.95 ± $0.15 Shares-based compensation per share $0.33 Intangible amortization per share $0.24 Convertible debt discount OID and fees per share $0.08 Diluted EPS – Non-GAAP $1.60 ± $0.15 Expected
Slide 14: Closing Remarks
Closing Remarks Environment COVID -19 Positioned for Social & Governance Safety Measures Growth All SGH sites continue Growth and Making progress on our to operate while diversification strategy 2020 ESG disclosures maintaining a safe and delivering shareholder healthy environment value 14
Slide 15: Thank you
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Slide 16: Appendix
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Slide 17: Reconciliation of gross profit and operating expenses
Three Months Ended February 26, May 28, 2021 2021 May 29, 2020 Reconciliation of gross profit: GAAP gross profit $ 84,487 $ 53,456 $ 54,233 GAAP gross margin 19.3% 17.6% 19.3% Add: Share-based compensation included in cost of sales 1,166 804 699 Add: Intangible amortization included in cost of sales
Slide 18: Reconciliation of net income and earnings per share
Three Months Ended February 26, May 28, 2021 2021 May 29, 2020 Reconciliation of net income (loss) and earnings per share (diluted): GAAP net income (loss) $ (7,211) $ 5,844 $ 825 Adjustments to GAAP net income (loss): Share-based compensation 8,381 5,398 4,907 Amortization of intangible assets 6,18
Slide 19: Adjusted EBITDA reconciliation
Three Months Ended May 28, February 26, May 29, 2021 2021 2020 GAAP net income (loss) $ (7,211) $ 5,844 $ 825 Share-based compensation expense 8,381 5,398 4,907 Amortization of intangible assets 6,184 3,413 3,414 Interest expense, net 5,049 4,365 3,094 Provision for income tax 4,010 1,200 2,700 Depr
Slide 20: Convertible Dilution Table
Convertible Share Net Share Dilution Dilution Table Capped Call Dilution to SGH Stock Price $40.00 0.00 0.00 0.00 $42.50 0.27 0.27 0.00 $45.00 0.60 0.60 0.00 $47.50 0.89 0.89 0.00 $50.00 1.16 1.16 0.00 $52.50 1.39 1.39 0.00 $55.00 1.61 1.52 0.10 $57.50 1.81 1.45 0.36 $60.00 1.99 1.39 0.60 $62.50 2.1
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