Rubicon Technology, Inc. (NASDAQ:RBCN), a leading provider of sapphire substrates and products to the LED, semiconductor, and optical industries, today reported financial results for its first quarter ended March 31, 2015.
The Company reported first quarter revenue of $8.9 million which was consistent with the prior quarter revenue and reduced its loss per share despite continued weakness in the LED market. Demand for the Company’s two-inch sapphire cores, primarily used in the mobile device market, increased in the period but was offset in part by lower revenue from four-inch LED core sales. The Company continued qualifying its large diameter PSS wafers and believes that PSS revenue will ramp in the second half of the year. A table with the breakdown of revenue is included with this press release.
Loss per share in the first quarter was $0.32 as compared with prior quarter loss of $0.36.
The Company also reviewed the status on key objectives for 2015, which include aggressively pursuing the potential of its PSS product, targeting high margin optical applications and driving down product costs. William Weissman, Rubicon’s CEO, commented, “The sapphire market continues to be very challenging but the actions we are taking during this difficult time in the market will position the Company to drive better margins from a more diverse set of products once the market improves.”
Second Quarter 2015 Guidance
The Company expects second quarter revenue and loss per share to be similar to the first quarter. While core sale volumes will likely be higher, total revenue is expected to be similar to the first quarter due to additional pricing pressure, particularly on two-inch material. Loss per share is also expected to be similar to the first quarter with cost reductions offsetting the additional price pressure. Commenting on the Company’s outlook, Mr. Weissman said, “While we expect second quarter results to be comparable to the first quarter, we have visibility into growing PSS volumes in the second half of the year. With increased wafer revenue in combination with reducing product costs, we expect a meaningful improvement in operating results by the end of the year.”
Conference Call Details
Rubicon will host a conference call at 5:00 p.m. Eastern time on May 7, 2015 to review the first quarter 2015 results and the second quarter outlook. The conference call will be available to the public through a live audio web broadcast via the Internet. Log on through the Investor Relations section of Rubicon's website at http://ir.rubicontechnology.com. An audio replay of the call will be available approximately two hours after the conclusion of the call. The audio replay will remain available until 9:00 a.m. Eastern time on May 14, 2015, and can be accessed by dialing (877) 344-7529 or (412) 317-0088 (international). Callers should reference conference ID 10064451. The webcast will be archived on the Company's website.
About Rubicon Technology, Inc.
Rubicon Technology, Inc. is a vertically integrated advanced electronic materials provider specializing in monocrystalline sapphire for applications in light-emitting diodes (LEDs), optical systems and specialty electronic devices. Rubicon has a proprietary technology platform and expertise extending from the preparation of raw aluminum oxide through sapphire crystal growth and fabrication to large-diameter polished sapphire wafers and patterned sapphire substrates (PSS), enabling Rubicon to supply custom sapphire products with superior quality and precision. Rubicon is ISO 9001 certified and ITAR registered.
Further information is available at http://www.rubicontechnology.com.
Forward-Looking Statements
Certain of the statements in this release, particularly those preceded by, followed by or including the words “believes,” “expects,” “anticipates,” “intends,” “should,” “estimates,” or similar expressions, or those relating to or anticipating financial results for periods beyond the end of the first quarter of 2015, constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. For those statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by us. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, the statements. These risks and uncertainties include changes in the average selling prices of sapphire products, our successful development and market acceptance of new products, dependence on key customers, potential disruptions in our supply of electricity, changes in our product mix, our ability to protect our intellectual property rights, the competitive environment, the availability and cost of raw materials, the cost of compliance with environmental standards, the ability to make effective acquisitions and successfully integrate newly acquired businesses into existing operations and other risks and uncertainties described in the Company's most recent Form 10-K and other filings with the Securities and Exchange Commission. For these reasons, readers are cautioned not to place undue reliance on the Company's forward-looking statements. Any forward-looking statement that the Company makes speaks only as of the date of such statement, and the Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.
| Rubicon Technology, Inc. | ||||||
| Condensed Consolidated Balance Sheets | ||||||
| (in thousands) | ||||||
| March 31, | March 31, | |||||
| 2015 | 2014 | |||||
| (unaudited) | (unaudited) | |||||
| Assets | ||||||
| Cash and cash equivalents | $ | 25,127 | $ | 27,681 | ||
| Restricted cash | 179 | 161 | ||||
| Short-term investments | 15,876 | 35,481 | ||||
| Accounts receivable, net | 7,553 | 8,168 | ||||
| Inventories | 21,798 | 28,570 | ||||
| Other current assets | 8,920 | 13,780 | ||||
| Total current assets | 79,453 | 113,841 | ||||
| Property and equipment, net | 104,593 | 113,637 | ||||
| Other assets | 1,604 | 1,346 | ||||
| Total assets | $ | 185,650 | $ | 228,824 | ||
| Liabilities and Stockholders' Equity | ||||||
| Accounts payable | $ | 2,640 | $ | 5,676 | ||
| Accrued and other current liabilities | 1,845 | 2,759 | ||||
| Total current liabilities | 4,485 | 8,435 | ||||
| Deferred tax liability | 622 | 162 | ||||
| Total liabilities | 5,107 | 8,597 | ||||
| Stockholders' equity | 180,543 | 220,227 | ||||
| Total liabilities and stockholders’ equity | $ | 185,650 | $ | 228,824 | ||
| Rubicon Technology, Inc. | ||||||||
| Condensed Consolidated Statements of Operations (unaudited) | ||||||||
| (in thousands except share and per share amounts) | ||||||||
| Three months ended March 31, | ||||||||
| 2015 | 2014 | |||||||
| Revenue | $ | 8,910 | $ | 14,268 | ||||
| Cost of goods sold | 14,019 | 21,762 | ||||||
| Gross loss | (5,109 | ) | (7,494 | ) | ||||
| General and administrative expenses | 2,068 | 2,388 | ||||||
| Sales and marketing expenses | 338 | 467 | ||||||
| Research and development expenses | 433 | 576 | ||||||
| Total operating expenses | 2,839 | 3,431 | ||||||
| Loss from operations | (7,948 | ) | (10,925 | ) | ||||
| Other income: | ||||||||
| Interest (expense) income and other, net | (364 | ) | 37 | |||||
| Loss before income taxes | (8,312 | ) | (10,888 | ) | ||||
| Income tax expense | (36 | ) | (6 | ) | ||||
| Net loss | $ | (8,348 | ) | $ | (10,894 | ) | ||
| Net loss per common share: | ||||||||
| Basic | ($0.32 | ) | ($0.43 | ) | ||||
| Diluted | ($0.32 | ) | ($0.43 | ) | ||||
| Weighted average common shares outstanding used in computing net income per common share, basic and diluted: | 26,129,276 | 25,317,147 | ||||||
| Rubicon Technology, Inc. | ||||||||
| Condensed Consolidated Statements of Cash Flows (unaudited) | ||||||||
| (in thousands) | ||||||||
| Three months ended March 31, | ||||||||
| 2015 | 2014 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | (8,348 | ) | $ | (10,894 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities | ||||||||
| Depreciation and amortization | 3,317 | 3,507 | ||||||
| Other | 334 | 448 | ||||||
| Deferred taxes | 29 | - | ||||||
| Changes in operating assets and liabilities | ||||||||
| Accounts receivable | 770 | (4,597 | ) | |||||
| Inventories | 647 | 5,781 | ||||||
| Other assets | 432 | (494 | ) | |||||
| Accounts payable | (1,050 | ) | 1,192 | |||||
| Accrued expenses and other current liabilities | (138 | ) | 584 | |||||
| Net cash used in operating activities | (4,007 | ) | (4,473 | ) | ||||
| Cash flows from investing activities | ||||||||
| Purchases of property and equipment | (234 | ) | (1,924 | ) | ||||
| Purchases of investments | (307 | ) | (26,675 | ) | ||||
| Proceeds from sale of investments | 5,000 | 4,500 | ||||||
| Net cash provided by (used in) investing activities | 4,459 | (24,099 | ) | |||||
| Cash flows from financing activities | ||||||||
| Proceeds from issuance of common stock, net of issuance costs | - | 34,961 | ||||||
| Other financing activities | (4 | ) | 260 | |||||
| Net cash (used in) provided by financing activities | (4 | ) | 35,221 | |||||
| Net effect of currency translation | 326 | (39 | ) | |||||
| Net increase in cash and cash equivalents | 774 | 6,610 | ||||||
| Cash and cash equivalents, beginning of period | 24,353 | 21,071 | ||||||
| Cash and cash equivalents, end of period | $ | 25,127 | $ | 27,681 | ||||
| Rubicon Technology, Inc. | |||||||||
| Revenue by Product Group | |||||||||
| (in thousands) | |||||||||
Three months ended |
Three months ended |
Three months ended | |||||||
| 2015 | 2014 | 2014 | |||||||
| Core | |||||||||
| 2 Inch | $ | 4,046 | $ | 3,192 | $ | 8,500 | |||
| 4 Inch | 1,040 | 1,554 | 2,855 | ||||||
| 6 Inch | 23 | 5 | - | ||||||
| Total Core | 5,109 | 4,751 | 11,355 | ||||||
| Polished | 1,427 | 1,470 | 1,005 | ||||||
| PSS | 464 | 511 | 90 | ||||||
| R&D | 141 | 137 | 125 | ||||||
| Optical and other | 1,769 | 2,043 | 1,693 | ||||||
| $ | 8,910 | $ | 8,912 | $ | 14,268 | ||||
Contacts:
Dee Johnson, 847-457-3426
Vice
President, Investor Relations
