II-VI Incorporated (Nasdaq:IIVI) ("II-VI," “We” or the "Company")
today reported results for its fiscal 2022 second quarter ended
December 31, 2021.
“II-VI delivered our first quarter of greater than $1.1 billion
in bookings and a record backlog of $1.7 billion as demand
continues across our end markets, due to continued strength in the
megatrends underpinning our growth strategy. Products for the
industrial and communications markets led our growth
year-over-year. In industrial, we shipped a record 100 megawatts of
pump laser power and we ramped up our sales of silicon carbide
substrates for power electronics. The strong demand for
transceivers in hyperscale datacenters and AI superclusters
continues unabated. Our sales of 200G, 400G, and 800G transceivers
now represent about a third of our datacom transceiver business,”
said Dr. Vincent D. Mattera Jr., Chair and CEO.
Dr. Mattera continued, “Our consumer business led our sequential
growth and represented 9% of our sales this quarter, our third
largest revenue by market. We continue to see greater opportunities
with a broader set of products in an expanding range of depth
sensing applications, in consumer electronics, industrial, and
automotive markets.
We were excited to announce that we qualified our own 1200 V SiC
MOSFET product platform to automotive standards, leveraging our
differentiated 150 mm SiC substrates. We expanded our relationship
with GE to accelerate the next phase of commercialization in
industrial, renewable energy, and automotive.
The pending acquisition of Coherent has received the approval,
or indication of imminent approval, from 3 out of 4 global
antitrust regulatory authorities, which approvals are conditions to
the closing of the transaction. In China, the remaining
jurisdiction, II-VI and Coherent are continuing to work
constructively with the State Administration for Market Regulation
(“SAMR”), and now anticipate closing the acquisition by the middle
of the second calendar quarter of 2022,” concluded Dr. Mattera.
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Table 1 |
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|
Financial
Metrics |
|
|
|
|
|
|
|
|
|
|
|
$ Millions, except per
share amounts and % |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
Dec 31, |
|
Dec 31, |
|
|
|
2021 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
806.8 |
|
|
$ |
795.1 |
|
|
$ |
786.6 |
|
|
|
$ |
1,601.9 |
|
|
$ |
1,514.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Gross
Profit (3) |
|
$ |
311.2 |
|
|
$ |
306.6 |
|
|
$ |
312.7 |
|
|
|
$ |
617.8 |
|
|
$ |
589.7 |
|
Non-GAAP Gross
Profit (2) |
|
$ |
324.8 |
|
|
$ |
317.7 |
|
|
$ |
330.6 |
|
|
|
$ |
642.4 |
|
|
$ |
619.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating
Income (1) |
|
$ |
98.2 |
|
|
$ |
95.1 |
|
|
$ |
118.7 |
|
|
|
$ |
193.3 |
|
|
$ |
219.9 |
|
Non-GAAP Operating
Income (2) |
|
$ |
159.2 |
|
|
$ |
150.2 |
|
|
$ |
173.0 |
|
|
|
$ |
309.6 |
|
|
$ |
311.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net
Earnings |
|
$ |
67.7 |
|
|
$ |
74.5 |
|
|
$ |
87.9 |
|
|
|
$ |
142.1 |
|
|
$ |
134.2 |
|
Non-GAAP Net
Earnings (2) |
|
$ |
124.1 |
|
|
$ |
117.7 |
|
|
$ |
131.2 |
|
|
|
$ |
241.8 |
|
|
$ |
231.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Diluted Earnings
Per Share |
|
$ |
0.44 |
|
|
$ |
0.50 |
|
|
$ |
0.73 |
|
|
|
$ |
0.94 |
|
|
$ |
1.12 |
|
Non-GAAP Diluted
Earnings Per Share (2) |
|
$ |
0.92 |
|
|
$ |
0.87 |
|
|
$ |
1.08 |
|
|
|
$ |
1.78 |
|
|
$ |
1.94 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Selected
Financial Metrics |
|
|
|
|
|
|
|
|
|
|
|
GAAP gross margin (3) |
|
|
38.6 |
% |
|
|
38.6 |
% |
|
|
39.8 |
% |
|
|
|
38.6 |
% |
|
|
38.9 |
% |
Non-GAAP gross margin (2) |
|
|
40.3 |
% |
|
|
40.0 |
% |
|
|
42.0 |
% |
|
|
|
40.1 |
% |
|
|
40.9 |
% |
GAAP Operating margin |
|
|
12.2 |
% |
|
|
12.0 |
% |
|
|
15.1 |
% |
|
|
|
12.1 |
% |
|
|
14.5 |
% |
Non-GAAP operating margin (2) |
|
|
19.7 |
% |
|
|
18.9 |
% |
|
|
22.0 |
% |
|
|
|
19.3 |
% |
|
|
20.6 |
% |
GAAP Return on sales |
|
|
8.4 |
% |
|
|
9.4 |
% |
|
|
11.2 |
% |
|
|
|
8.9 |
% |
|
|
8.9 |
% |
Non-GAAP return on sales (2) |
|
|
15.4 |
% |
|
|
14.8 |
% |
|
|
16.7 |
% |
|
|
|
15.1 |
% |
|
|
15.3 |
% |
(1) |
GAAP operating
income is defined as earnings before income taxes, interest expense
and other expense or income, net. |
(2) |
All non-GAAP amounts exclude certain adjustments for
share-based compensation, acquired intangible amortization expense,
restructuring, integration and transaction expenses, as well as
start-up costs related to the start-up of new devices for new
customer applications. See Table 4 for the Reconciliation of GAAP
measures to non-GAAP measures. |
(3) |
GAAP gross profit for prior periods has been updated to include
amortization of developed technology intangible assets. |
Outlook
The outlook for the third fiscal quarter ending March 31, 2022
is revenue of $785 million to $825 million and earnings per diluted
share on a non-GAAP basis of $0.75 to $0.90. This is at today’s
exchange rate and today’s estimated tax impact of 19%. Both of
these are subject to variability. For the non-GAAP earnings per
share, we added back to the GAAP earnings pre-tax amounts of $20
million in amortization, $20 million in share-based compensation,
and $21-26 million in transaction, integration and other related
costs. Refer to Table 8 for the share count range for the
aforementioned outlook. Non-GAAP adjustments are by their nature
highly volatile and we have low visibility as to the range that may
be incurred in the future.
Conference Call & Webcast
Information
The Company will host a conference call at 9:00 a.m. Eastern
Time on Wednesday February 9, 2022 to discuss these results.
Individuals wishing to participate in the webcast can access the
event at the Company’s web site by visiting www.ii-vi.com or via
https://tinyurl.com/IIVIQ2FY22earningsrelease. If you wish to
participate in the call, please dial +1 734-385-4977 or
877-316-5288. When you call, please enter Confirmation Code 9039109
and provide your name and company affiliation.
The call will be recorded, and a replay will be available to
interested parties who are unable to attend the live event. This
service will be available up to 11:59 p.m. EST on Friday, February
18, 2022, by dialing +1-855-859-2056 or 800-585-8367 and entering
the ID number 9039109.
About II-VI Incorporated
II-VI Incorporated, a global leader in engineered materials and
optoelectronic components, is a vertically integrated manufacturing
company that develops innovative products for diversified
applications in communications, industrial, aerospace &
defense, semiconductor capital equipment, life sciences, consumer
electronics, and automotive markets. Headquartered in Saxonburg,
Pennsylvania, the Company has research and development,
manufacturing, sales, service, and distribution facilities
worldwide. The Company produces a wide variety of
application-specific photonic and electronic materials and
components, and deploys them in various forms, including integrated
with advanced software to support our customers. For more
information, please visit us at www.ii-vi.com.
Forward-looking Statements
This press release contains forward-looking statements relating
to future events and expectations that are based on certain
assumptions and contingencies. The forward-looking statements are
made pursuant to the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995 and relate to the
Company’s performance on a going-forward basis. The forward-looking
statements in this press release involve risks and uncertainties,
which could cause actual results, performance, or trends to differ
materially from those expressed in the forward-looking statements
herein or in previous disclosures.
The Company believes that all forward-looking statements made by
it in this press release have a reasonable basis, but there can be
no assurance that management’s expectations, beliefs, or
projections as expressed in the forward-looking statements will
actually occur or prove to be correct. In addition to general
industry and global economic conditions, factors that could cause
actual results to differ materially from those discussed in the
forward-looking statements in this press release include but are
not limited to: (i) the failure of any one or more of the
assumptions stated above to prove to be correct; (ii) the risks
relating to forward-looking statements and other “Risk Factors”
discussed in the Company’s Annual Report on Form 10-K for the
fiscal year ended June 30, 2021 and additional risk factors that
may be identified from time to time in future filings of the
Company; (iii) the conditions to the completion of the Company’s
pending business combination transaction with Coherent, Inc. (the
“Transaction”) and the remaining equity investment by Bain Capital,
LP, including the receipt of any required shareholder and
regulatory approvals, and the risks that those conditions will not
be satisfied in a timely manner or at all; (iv) the occurrence of
any event, change or other circumstances that could give rise to an
amendment or termination of the merger agreement relating to the
Transaction, including the receipt by Coherent, Inc. (“Coherent”)
of an unsolicited proposal from a third party; (v) the Company’s
ability to finance the Transaction, the substantial indebtedness
the Company expects to incur in connection with the Transaction and
the need to generate sufficient cash flows to service and repay
such debt; (vi) the possibility that the Company may be unable to
achieve expected synergies, operating efficiencies and other
benefits within the expected time-frames or at all and to
successfully integrate Coherent’s operations with those of the
Company; (vii) the possibility that such integration may be more
difficult, time-consuming or costly than expected or that operating
costs and business disruption (including, without limitation,
disruptions in relationships with employees, customers or
suppliers) may be greater than expected in connection with the
Transaction; (viii) litigation and any unexpected costs, charges or
expenses resulting from the Transaction; (ix) the risk that
disruption from the Transaction materially and adversely affects
the respective businesses and operations of the Company and
Coherent; (x) potential adverse reactions or changes to business
relationships resulting from the announcement, pendency or
completion of the Transaction; (xi) the ability of the Company to
retain and hire key employees; (xii) the purchasing patterns of
customers and end users; (xiii) the timely release of new products,
and acceptance of such new products by the market; (xiv) the
introduction of new products by competitors and other competitive
responses; (xv) the Company’s ability to assimilate recently
acquired businesses, and realize synergies, cost savings, and
opportunities for growth in connection therewith, together with the
risks, costs, and uncertainties associated with such acquisitions;
(xvi) the Company’s ability to devise and execute strategies to
respond to market conditions; (xviii) the risks to realizing the
benefits of investments in R&D and commercialization of
innovations; (xix) the risks that the Company’s stock price will
not trade in line with industrial technology leaders; and/or (xx)
the risks of business and economic disruption related to the
currently ongoing COVID-19 outbreak and any other worldwide health
epidemics or outbreaks that may arise. The Company disclaims any
obligation to update information contained in these forward-looking
statements, whether as a result of new information, future events
or developments, or otherwise.
These risks, as well as other risks associated with the proposed
transaction, are more fully discussed in the joint proxy
statement/prospectus included in the registration statement on Form
S-4 (File No. 333-255547) filed with the SEC in connection with the
Transaction (the “Form S-4”). While the list of factors discussed
above and the list of factors presented in the Form S-4 are
considered representative, no such list should be considered to be
a complete statement of all potential risks and uncertainties.
Unlisted factors may present significant additional obstacles to
the realization of forward looking statements. Neither the Company
nor Coherent assumes any obligation to publicly provide revisions
or updates to any forward looking statements, whether as a result
of new information, future developments or otherwise, should
circumstances change, except as otherwise required by securities
and other applicable laws.
Use of Non-GAAP Financial
Measures
The Company has disclosed financial measurements in this press
release that present financial information considered to be
non-GAAP financial measures. These measurements are not a
substitute for GAAP measurements, although the Company's management
uses these measurements as an aid in monitoring the Company's
on-going financial performance. The non-GAAP net earnings, the
non-GAAP earnings per share, the non-GAAP operating income, the
non-GAAP gross profit, the non-GAAP internal research and
development, the non-GAAP selling, general and administration, the
non-GAAP interest and other (income) expense, and the non-GAAP
income tax (benefit), measure earnings and operating income (loss),
respectively, excluding non-recurring or unusual items that are
considered by management to be outside the Company’s standard
operation and excluding certain non-cash items. EBITDA is an
adjusted non-GAAP financial measurement that is considered by
management to be useful in measuring the profitability between
companies within the industry by reflecting operating results of
the Company excluding non-operating factors. There are limitations
associated with the use of non-GAAP financial measures, including
that such measures may not be entirely comparable to similarly
titled measures used by other companies, due to potential
differences among calculation methodologies. Thus, there can be no
assurance whether (i) items excluded from the non-GAAP financial
measures will occur in the future or (ii) there will be cash costs
associated with items excluded from the non-GAAP financial
measures. The Company compensates for these limitations by using
these non-GAAP financial measures as supplements to GAAP financial
measures and by providing the reconciliations of the non-GAAP
financial measures to their most comparable GAAP financial
measures. Investors should consider adjusted measures in addition
to, and not as a substitute for, or superior to, financial
performance measures prepared in accordance with GAAP.
|
II-VI
Incorporated and Subsidiaries |
Condensed
Consolidated Statements of Earnings (Unaudited) |
($000
except per share data) |
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
|
2021 |
|
|
2021 |
|
|
|
2020 |
|
|
|
|
|
|
|
|
Revenues |
|
$ |
806,819 |
|
$ |
795,111 |
|
|
$ |
786,569 |
|
|
|
|
|
|
|
|
Costs, Expenses &
Other Expense |
|
|
|
|
|
|
Cost of goods sold |
|
|
495,652 |
|
|
488,487 |
|
|
|
473,863 |
|
Internal research and development |
|
|
95,328 |
|
|
88,966 |
|
|
|
84,858 |
|
Selling, general and administrative |
|
|
117,617 |
|
|
122,608 |
|
|
|
109,133 |
|
Interest expense |
|
|
17,062 |
|
|
12,191 |
|
|
|
15,585 |
|
Other expense (income), net |
|
|
1,806 |
|
|
(7,582 |
) |
|
|
(3,153 |
) |
Total Costs, Expenses, & Other Expense |
|
|
727,465 |
|
|
704,670 |
|
|
|
680,286 |
|
|
|
|
|
|
|
|
Earnings Before Income
Taxes |
|
|
79,354 |
|
|
90,441 |
|
|
|
106,283 |
|
|
|
|
|
|
|
|
Income
Taxes |
|
|
11,697 |
|
|
15,977 |
|
|
|
18,383 |
|
|
|
|
|
|
|
|
Net
Earnings |
|
|
67,657 |
|
|
74,464 |
|
|
|
87,900 |
|
|
|
|
|
|
|
|
Less: Dividends on
Preferred Stock |
|
|
16,703 |
|
|
17,082 |
|
|
|
6,900 |
|
Net Earnings available
to the Common Shareholders |
|
|
50,954 |
|
|
57,382 |
|
|
|
81,000 |
|
|
|
|
|
|
|
|
Basic Earnings Per
Share |
|
$ |
0.48 |
|
$ |
0.54 |
|
|
$ |
0.78 |
|
|
|
|
|
|
|
|
Diluted Earnings Per
Share |
|
$ |
0.44 |
|
$ |
0.50 |
|
|
$ |
0.73 |
|
|
|
|
|
|
|
|
Average Shares
Outstanding - Basic |
|
|
106,158 |
|
|
105,761 |
|
|
|
104,092 |
|
Average Shares
Outstanding - Diluted |
|
|
116,440 |
|
|
115,849 |
|
|
|
115,053 |
|
II-VI
Incorporated and Subsidiaries |
Condensed
Consolidated Statements of Earnings (Unaudited) |
($000
except per share data) |
|
|
|
|
|
|
|
Six Months Ended |
|
|
December 31, |
|
December 31, |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
|
Revenues |
|
$ |
1,601,930 |
|
|
$ |
1,514,653 |
|
|
|
|
|
Costs, Expenses &
Other Expense |
|
|
|
|
Cost of goods sold |
|
|
984,139 |
|
|
|
924,977 |
Internal research and development |
|
|
184,294 |
|
|
|
163,106 |
Selling, general and administrative |
|
|
240,225 |
|
|
|
206,725 |
Interest expense |
|
|
29,253 |
|
|
|
32,799 |
Other expense (income), net |
|
|
(5,776 |
) |
|
|
21,186 |
Total Costs, Expenses, & Other Expense |
|
|
1,432,135 |
|
|
|
1,348,793 |
|
|
|
|
|
Earnings Before Income
Taxes |
|
|
169,795 |
|
|
|
165,860 |
|
|
|
|
|
Income
Taxes |
|
|
27,674 |
|
|
|
31,694 |
|
|
|
|
|
Net
Earnings |
|
$ |
142,121 |
|
|
$ |
134,166 |
|
|
|
|
|
Less: Dividends on
Preferred Stock |
|
|
33,785 |
|
|
|
13,340 |
Net Earnings available
to the Common Shareholders |
|
$ |
108,336 |
|
|
$ |
120,826 |
|
|
|
|
|
Basic Earnings Per
Share |
|
$ |
1.02 |
|
|
$ |
1.17 |
Diluted Earnings Per
Share |
|
$ |
0.94 |
|
|
$ |
1.12 |
|
|
|
|
|
Average Shares
Outstanding - Basic |
|
|
105,960 |
|
|
|
103,450 |
Average Shares
Outstanding - Diluted |
|
|
116,144 |
|
|
|
113,784 |
II-VI
Incorporated and Subsidiaries |
|
|
|
|
Condensed
Consolidated Balance Sheets (Unaudited) |
|
|
|
|
($000) |
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
June 30, |
|
|
|
2021 |
|
|
2021 |
Assets |
|
|
|
|
Current Assets |
|
|
|
|
Cash, cash equivalents, and restricted cash |
|
$ |
2,649,716 |
|
$ |
1,591,892 |
Accounts receivable |
|
|
604,206 |
|
|
658,962 |
Inventories |
|
|
819,091 |
|
|
695,828 |
Prepaid and refundable income taxes |
|
|
16,796 |
|
|
13,095 |
Prepaid and other current assets |
|
|
75,986 |
|
|
67,617 |
Total Current Assets |
|
|
4,165,795 |
|
|
3,027,394 |
Property, plant & equipment, net |
|
|
1,272,377 |
|
|
1,242,906 |
Goodwill |
|
|
1,293,167 |
|
|
1,296,727 |
Other intangible assets, net |
|
|
676,465 |
|
|
718,460 |
Deferred income taxes |
|
|
36,600 |
|
|
33,498 |
Other assets |
|
|
204,879 |
|
|
193,665 |
Total
Assets |
|
$ |
7,649,283 |
|
$ |
6,512,650 |
|
|
|
|
|
Liabilities, Mezzanine Equity and Shareholders’
Equity |
|
|
|
|
Current Liabilities |
|
|
|
|
Current portion of long-term debt |
|
$ |
1,378,118 |
|
$ |
62,050 |
Accounts payable |
|
|
339,985 |
|
|
294,486 |
Operating lease current liabilities |
|
|
28,015 |
|
|
25,358 |
Accruals and other current liabilities |
|
|
337,122 |
|
|
347,695 |
Total Current Liabilities |
|
|
2,083,240 |
|
|
729,589 |
Long-term debt |
|
|
942,579 |
|
|
1,313,091 |
Deferred income taxes |
|
|
80,367 |
|
|
73,962 |
Operating lease liabilities |
|
|
120,449 |
|
|
125,541 |
Other liabilities |
|
|
139,072 |
|
|
138,119 |
Total Liabilities |
|
|
3,365,707 |
|
|
2,380,302 |
Total Mezzanine Equity |
|
|
746,163 |
|
|
726,178 |
Total Shareholders' Equity |
|
|
3,537,413 |
|
|
3,406,170 |
Total
Liabilities, Mezzanine Equity and Shareholders’
Equity |
|
$ |
7,649,283 |
|
$ |
6,512,650 |
II-VI
Incorporated and Subsidiaries |
|
|
|
|
Condensed
Consolidated Statements of Cash Flows (Unaudited) |
|
|
|
|
($000) |
|
Six Months Ended |
|
|
December 31, |
|
|
|
2021 |
|
|
|
2020 |
|
Cash Flows
from Operating Activities |
|
|
|
|
Net cash provided by operating activities |
|
$ |
240,085 |
|
|
$ |
355,699 |
|
|
|
|
|
|
Cash Flows
from Investing Activities |
|
|
|
|
Additions to property, plant & equipment |
|
|
(101,689 |
) |
|
|
(79,329 |
) |
Purchases of businesses, net of cash acquired |
|
|
— |
|
|
|
(34,431 |
) |
Net cash used in investing activities |
|
|
(101,689 |
) |
|
|
(113,760 |
) |
|
|
|
|
|
Cash Flows
from Financing Activities |
|
|
|
|
Proceeds from issuance of Senior Notes |
|
|
990,000 |
|
|
|
— |
|
Proceeds from issuance of common shares |
|
|
— |
|
|
|
460,000 |
|
Proceeds from issuance of preferred shares |
|
|
— |
|
|
|
460,000 |
|
Payments on borrowings under Term A Facility |
|
|
(31,025 |
) |
|
|
(31,025 |
) |
Payments on Finisar Notes |
|
|
(14,888 |
) |
|
|
Payments on borrowings under Term B Facility |
|
|
— |
|
|
|
(714,600 |
) |
Payments on borrowings under Revolving Credit Facility |
|
|
— |
|
|
|
(74,000 |
) |
Debt issuance costs |
|
|
(5,639 |
) |
|
|
— |
|
Equity issuance costs |
|
|
— |
|
|
|
(36,092 |
) |
Proceeds from exercises of stock options |
|
|
8,370 |
|
|
|
22,355 |
|
Payments in satisfaction of employees' minimum tax obligations |
|
|
(13,823 |
) |
|
|
(6,941 |
) |
Payment of dividends |
|
|
(20,708 |
) |
|
|
(6,519 |
) |
Other financing activities |
|
|
(1,415 |
) |
|
|
(366 |
) |
Net cash provided by (used in) financing
activities |
|
|
910,872 |
|
|
|
72,812 |
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents |
|
|
8,556 |
|
|
|
26,743 |
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents |
|
|
1,057,824 |
|
|
|
341,494 |
|
|
|
|
|
|
Cash, Cash Equivalents, and Restricted Cash at Beginning of
Period |
|
|
1,591,892 |
|
|
|
493,046 |
|
Cash, Cash Equivalents, and Restricted Cash at End of
Period |
|
$ |
2,649,716 |
|
|
$ |
834,540 |
|
Cash paid for interest |
|
$ |
16,104 |
|
|
$ |
13,898 |
|
Cash paid for income taxes |
|
$ |
22,933 |
|
|
$ |
24,227 |
|
Additions to property, plant & equipment included in accounts
payable |
|
$ |
64,098 |
|
|
$ |
10,497 |
|
Table 2 |
|
|
|
|
|
|
|
|
|
|
|
Segment
Revenues, GAAP Operating Income (Loss) & Margins,
and |
|
|
|
|
|
|
|
Non-GAAP
Operating Income (Loss) & Margins* |
|
|
|
|
|
|
|
$ Millions, except
% |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
Dec 31, |
|
Dec 31, |
|
|
|
2021 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
2021 |
|
|
|
2020 |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
Photonic Solutions |
|
$ |
525.0 |
|
|
$ |
536.0 |
|
|
$ |
482.9 |
|
|
|
$ |
1,061.0 |
|
|
$ |
980.6 |
|
Compound Semiconductors |
|
|
281.8 |
|
|
|
259.1 |
|
|
|
303.6 |
|
|
|
|
540.9 |
|
|
|
534.0 |
|
Unallocated and Other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
Consolidated |
|
$ |
806.8 |
|
|
$ |
795.1 |
|
|
$ |
786.6 |
|
|
|
$ |
1,601.9 |
|
|
$ |
1,514.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income
(Loss): |
|
|
|
|
|
|
|
|
|
|
|
Photonic Solutions |
|
$ |
49.8 |
|
|
$ |
56.5 |
|
|
$ |
48.5 |
|
|
|
$ |
106.3 |
|
|
$ |
98.9 |
|
Compound Semiconductors |
|
|
57.2 |
|
|
|
49.7 |
|
|
|
70.3 |
|
|
|
|
106.9 |
|
|
|
121.0 |
|
Unallocated and Other |
|
|
(8.7 |
) |
|
|
(11.2 |
) |
|
|
— |
|
|
|
|
(19.9 |
) |
|
|
— |
|
Consolidated |
|
$ |
98.2 |
|
|
$ |
95.1 |
|
|
$ |
118.7 |
|
|
|
$ |
193.3 |
|
|
$ |
219.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating
Income: |
|
|
|
|
|
|
|
|
|
|
|
Photonic Solutions |
|
$ |
76.9 |
|
|
$ |
84.0 |
|
|
$ |
84.1 |
|
|
|
$ |
160.9 |
|
|
$ |
162.3 |
|
Compound Semiconductors |
|
|
82.4 |
|
|
|
66.3 |
|
|
|
88.9 |
|
|
|
|
148.7 |
|
|
|
149.6 |
|
Unallocated and Other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
Consolidated |
|
$ |
159.2 |
|
|
$ |
150.2 |
|
|
$ |
173.0 |
|
|
|
$ |
309.6 |
|
|
$ |
311.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating
Margin: |
|
|
|
|
|
|
|
|
|
|
|
Photonic Solutions |
|
|
9.5 |
% |
|
|
10.5 |
% |
|
|
10.0 |
% |
|
|
|
10.0 |
% |
|
|
10.1 |
% |
Compound Semiconductors |
|
|
20.3 |
% |
|
|
19.2 |
% |
|
|
23.2 |
% |
|
|
|
19.8 |
% |
|
|
22.7 |
% |
Unallocated and Other |
|
|
NA |
|
|
|
NA |
|
|
|
NA |
|
|
|
|
NA |
|
|
|
NA |
|
Consolidated |
|
|
12.2 |
% |
|
|
12.0 |
% |
|
|
15.1 |
% |
|
|
|
12.1 |
% |
|
|
14.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating
Margin: |
|
|
|
|
|
|
|
|
|
|
|
Photonic Solutions |
|
|
14.6 |
% |
|
|
15.7 |
% |
|
|
17.4 |
% |
|
|
|
15.2 |
% |
|
|
16.5 |
% |
Compound Semiconductors |
|
|
29.2 |
% |
|
|
25.6 |
% |
|
|
29.3 |
% |
|
|
|
27.5 |
% |
|
|
28.0 |
% |
Unallocated and Other |
|
|
NA |
|
|
|
NA |
|
|
|
NA |
|
|
|
|
NA |
|
|
|
NA |
|
Consolidated |
|
|
19.7 |
% |
|
|
18.9 |
% |
|
|
22.0 |
% |
|
|
|
19.3 |
% |
|
|
20.6 |
% |
*Amounts may not
recalculate due to rounding. |
Table 3 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Segment Non-GAAP Operating Income (Loss)
to |
|
|
|
|
|
|
|
GAAP Segment Operating
Income (Loss) |
|
|
|
|
|
|
|
|
|
|
|
$
Millions |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
Dec 31, |
|
Dec 31, |
|
|
|
2021 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
2021 |
|
|
|
2020 |
|
Non-GAAP Photonic Solutions
Operating Income |
|
$ |
76.9 |
|
|
$ |
84.0 |
|
|
$ |
84.1 |
|
|
|
$ |
160.9 |
|
|
$ |
162.3 |
|
Share-based compensation |
|
|
(9.4 |
) |
|
|
(9.6 |
) |
|
|
(12.1 |
) |
|
|
|
(19.0 |
) |
|
|
(22.6 |
) |
Amortization of acquired intangibles |
|
|
(16.6 |
) |
|
|
(17.0 |
) |
|
|
(17.3 |
) |
|
|
|
(33.6 |
) |
|
|
(34.6 |
) |
Restructuring, integration, and transaction expenses |
|
|
(1.1 |
) |
|
|
(0.9 |
) |
|
|
(6.2 |
) |
|
|
|
(2.0 |
) |
|
|
(6.2 |
) |
Photonic Solutions
GAAP Operating Income |
|
$ |
49.8 |
|
|
$ |
56.5 |
|
|
$ |
48.5 |
|
|
|
$ |
106.3 |
|
|
$ |
98.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Compound
Semiconductors Operating Income |
|
$ |
82.4 |
|
|
$ |
66.3 |
|
|
$ |
88.9 |
|
|
|
$ |
148.7 |
|
|
$ |
149.6 |
|
Share-based compensation |
|
|
(9.3 |
) |
|
|
(13.2 |
) |
|
|
(16.0 |
) |
|
|
|
(22.5 |
) |
|
|
(21.0 |
) |
Amortization of acquired intangibles |
|
|
(3.4 |
) |
|
|
(3.4 |
) |
|
|
(3.3 |
) |
|
|
|
(6.8 |
) |
|
|
(6.2 |
) |
Restructuring, integration, and transaction expenses |
|
|
(1.2 |
) |
|
|
— |
|
|
|
0.7 |
|
|
|
|
(1.2 |
) |
|
|
(1.4 |
) |
Start-up costs |
|
|
(11.3 |
) |
|
|
— |
|
|
|
— |
|
|
|
|
(11.3 |
) |
|
|
— |
|
Compound
Semiconductors GAAP Operating Income |
|
$ |
57.2 |
|
|
$ |
49.7 |
|
|
$ |
70.3 |
|
|
|
$ |
106.9 |
|
|
$ |
121.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Unallocated and Other
Operating Income (Loss) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
$ |
— |
|
|
$ |
— |
|
Restructuring, integration, and transaction expenses |
|
|
(8.7 |
) |
|
|
(11.2 |
) |
|
|
— |
|
|
|
|
(19.9 |
) |
|
|
— |
|
Unallocated and Other
GAAP Operating Income (Loss) |
|
$ |
(8.7 |
) |
|
$ |
(11.2 |
) |
|
$ |
— |
|
|
|
$ |
(19.9 |
) |
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total GAAP Operating
Income |
|
$ |
98.2 |
|
|
$ |
95.1 |
|
|
$ |
118.7 |
|
|
|
$ |
193.3 |
|
|
$ |
219.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating
Income |
|
$ |
159.2 |
|
|
$ |
150.2 |
|
|
$ |
173.0 |
|
|
|
$ |
309.6 |
|
|
$ |
311.9 |
|
*Amounts may not recalculate
due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 4 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP Measures to non-GAAP
Measures |
|
|
|
|
|
|
|
$ Millions |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
Dec 31, |
|
Dec 31, |
|
|
|
2021 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
2021 |
|
|
|
2020 |
|
Gross profit on GAAP basis
(4) |
|
$ |
311.2 |
|
|
$ |
306.6 |
|
|
$ |
312.7 |
|
|
|
$ |
617.8 |
|
|
$ |
589.7 |
|
Share-based compensation |
|
|
1.4 |
|
|
|
1.5 |
|
|
|
3.9 |
|
|
|
|
2.9 |
|
|
|
5.7 |
|
Amortization of acquired intangibles |
|
|
9.7 |
|
|
|
9.6 |
|
|
|
9.8 |
|
|
|
|
19.3 |
|
|
|
19.4 |
|
Start-up costs(3) |
|
|
1.2 |
|
|
|
— |
|
|
|
— |
|
|
|
|
1.2 |
|
|
|
— |
|
Restructuring, integration, and transaction expenses(1) |
|
|
1.2 |
|
|
|
— |
|
|
|
4.2 |
|
|
|
|
1.2 |
|
|
|
4.2 |
|
Gross profit on non-GAAP basis |
|
$ |
324.8 |
|
|
$ |
317.7 |
|
|
$ |
330.6 |
|
|
|
$ |
642.4 |
|
|
$ |
619.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Internal research and development on GAAP
basis |
|
$ |
95.3 |
|
|
$ |
89.0 |
|
|
$ |
84.9 |
|
|
|
$ |
184.3 |
|
|
$ |
163.1 |
|
Share-based compensation |
|
|
(2.0 |
) |
|
|
(2.3 |
) |
|
|
(5.4 |
) |
|
|
|
(4.3 |
) |
|
|
(8.0 |
) |
Start-up costs(3) |
|
|
(10.1 |
) |
|
|
— |
|
|
|
— |
|
|
|
|
(10.1 |
) |
|
|
— |
|
Internal research and development on non-GAAP
basis |
|
$ |
83.2 |
|
|
$ |
86.7 |
|
|
$ |
79.5 |
|
|
|
$ |
169.9 |
|
|
$ |
155.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative on GAAP
basis |
|
$ |
117.6 |
|
|
$ |
122.6 |
|
|
$ |
109.1 |
|
|
|
$ |
240.2 |
|
|
$ |
206.7 |
|
Share-based compensation |
|
|
(15.3 |
) |
|
|
(18.9 |
) |
|
|
(18.8 |
) |
|
|
|
(34.2 |
) |
|
|
(29.9 |
) |
Amortization of acquired intangibles |
|
|
(10.3 |
) |
|
|
(10.8 |
) |
|
|
(10.8 |
) |
|
|
|
(21.1 |
) |
|
|
(21.4 |
) |
Restructuring, integration, and transaction expenses(1) |
|
|
(9.8 |
) |
|
|
(12.0 |
) |
|
|
(1.3 |
) |
|
|
|
(21.9 |
) |
|
|
(3.4 |
) |
Selling, general and administrative on non-GAAP
basis |
|
$ |
82.3 |
|
|
$ |
80.9 |
|
|
$ |
78.2 |
|
|
|
$ |
163.1 |
|
|
$ |
152.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income on GAAP basis |
|
$ |
98.2 |
|
|
$ |
95.1 |
|
|
$ |
118.7 |
|
|
|
$ |
193.3 |
|
|
$ |
219.9 |
|
Share-based compensation |
|
|
18.7 |
|
|
|
22.7 |
|
|
|
28.1 |
|
|
|
|
41.4 |
|
|
|
43.6 |
|
Amortization of acquired intangibles |
|
|
20.0 |
|
|
|
20.4 |
|
|
|
20.6 |
|
|
|
|
40.4 |
|
|
|
40.8 |
|
Start-up costs(3) |
|
|
11.3 |
|
|
|
— |
|
|
|
— |
|
|
|
|
11.3 |
|
|
|
— |
|
Restructuring, integration, and transaction expenses(1) |
|
|
11.0 |
|
|
|
12.0 |
|
|
|
5.5 |
|
|
|
|
23.1 |
|
|
|
7.6 |
|
Operating income on non-GAAP basis |
|
$ |
159.2 |
|
|
$ |
150.2 |
|
|
$ |
173.0 |
|
|
|
$ |
309.6 |
|
|
$ |
311.9 |
|
Table 4 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP Measures to non-GAAP Measures
(Continued) |
|
|
|
|
|
|
|
$
Millions |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
Dec 31, |
|
Dec 31, |
|
|
|
2021 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
2021 |
|
|
|
2020 |
|
Interest and other
(income) expense, net on GAAP basis |
|
$ |
18.9 |
|
|
$ |
4.6 |
|
|
$ |
12.4 |
|
|
|
$ |
23.5 |
|
|
$ |
54.0 |
|
Foreign currency exchange gains (losses), net |
|
|
(0.2 |
) |
|
|
4.9 |
|
|
|
(7.5 |
) |
|
|
|
4.7 |
|
|
|
(12.2 |
) |
Gain on investment |
|
|
— |
|
|
|
— |
|
|
|
7.0 |
|
|
|
|
— |
|
|
|
7.0 |
|
Debt extinguishment expense (2) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
(24.7 |
) |
Restructuring, integration, and transaction expenses(1) |
|
|
(9.7 |
) |
|
|
— |
|
|
|
— |
|
|
|
|
(9.7 |
) |
|
|
— |
|
Interest and other
(income) expense, net on non-GAAP basis |
|
$ |
9.0 |
|
|
$ |
9.5 |
|
|
$ |
11.9 |
|
|
|
$ |
18.5 |
|
|
$ |
24.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income taxes on GAAP
basis |
|
$ |
11.7 |
|
|
$ |
16.0 |
|
|
$ |
18.4 |
|
|
|
$ |
27.7 |
|
|
$ |
31.7 |
|
Tax impact of non-GAAP measures |
|
|
14.4 |
|
|
|
7.1 |
|
|
|
11.4 |
|
|
|
|
21.5 |
|
|
|
24.5 |
|
Income taxes on
non-GAAP basis |
|
$ |
26.1 |
|
|
$ |
23.1 |
|
|
$ |
29.8 |
|
|
|
$ |
49.2 |
|
|
$ |
56.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings on GAAP
basis |
|
$ |
67.7 |
|
|
$ |
74.5 |
|
|
$ |
87.9 |
|
|
|
$ |
142.1 |
|
|
$ |
134.2 |
|
Share-based compensation |
|
|
18.7 |
|
|
|
22.7 |
|
|
|
28.1 |
|
|
|
|
41.4 |
|
|
|
43.6 |
|
Amortization of acquired intangibles |
|
|
20.0 |
|
|
|
20.4 |
|
|
|
20.6 |
|
|
|
|
40.4 |
|
|
|
40.8 |
|
Start-up costs(3) |
|
|
11.3 |
|
|
|
— |
|
|
|
— |
|
|
|
|
11.3 |
|
|
|
— |
|
Foreign currency exchange (gains) losses |
|
|
0.2 |
|
|
|
(4.9 |
) |
|
|
7.5 |
|
|
|
|
(4.7 |
) |
|
|
12.2 |
|
Gain on Innovion investment |
|
|
— |
|
|
|
— |
|
|
|
(7.0 |
) |
|
|
|
— |
|
|
|
(7.0 |
) |
Debt extinguishment expense (2) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
24.7 |
|
Restructuring, integration, and transaction expenses(1) |
|
|
20.7 |
|
|
|
12.0 |
|
|
|
5.5 |
|
|
|
|
32.8 |
|
|
|
7.6 |
|
Tax impact of non-GAAP measures |
|
|
(14.4 |
) |
|
|
(7.1 |
) |
|
|
(11.4 |
) |
|
|
|
(21.5 |
) |
|
|
(24.5 |
) |
Net earnings on
non-GAAP basis |
|
$ |
124.1 |
|
|
$ |
117.7 |
|
|
$ |
131.2 |
|
|
|
$ |
241.8 |
|
|
$ |
231.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share data: |
|
|
|
|
|
|
|
|
|
|
|
Net earnings on GAAP
basis |
|
|
|
|
|
|
|
|
|
|
|
Basic Earnings Per Share |
|
$ |
0.48 |
|
|
$ |
0.54 |
|
|
$ |
0.78 |
|
|
|
$ |
1.02 |
|
|
$ |
1.17 |
|
Diluted Earnings Per Share |
|
$ |
0.44 |
|
|
$ |
0.50 |
|
|
$ |
0.73 |
|
|
|
$ |
0.94 |
|
|
$ |
1.12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings on
non-GAAP basis |
|
|
|
|
|
|
|
|
|
|
|
Basic Earnings Per Share |
|
$ |
1.01 |
|
|
$ |
0.95 |
|
|
$ |
1.19 |
|
|
|
$ |
1.96 |
|
|
$ |
2.11 |
|
Diluted Earnings Per Share |
|
$ |
0.92 |
|
|
$ |
0.87 |
|
|
$ |
1.08 |
|
|
|
$ |
1.78 |
|
|
$ |
1.94 |
|
*Amounts may not recalculate
due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
During fiscal year 2022, transaction costs primarily represent fees
incurred in relation to the pending Coherent acquisition as well as
integration and restructuring charges from the Finisar acquisition.
During fiscal year 2021, transaction costs primarily represent
acquisition and integration costs related to the Ascatron and
Innovion acquisitions, as well as customer settlements from
acquired liabilities of previous acquisitions. |
(2) |
The Company recorded debt
extinguishment expense of $24.7 million in connection with the
extinguishment of the Term B Loan Facility during the six months
ended December 31, 2020. |
(3) |
Start-up costs of $11 million
of operating expenses incurred in the quarter were related to the
start-up of new devices for new customer applications. |
(4) |
GAAP gross profit for prior
periods has been updated to include amortization of developed
technology intangible assets. |
Table 5 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP Net Income (Loss), EBITDA and
Adjusted EBITDA |
|
|
|
|
|
$
Millions |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
Dec 31, |
|
Dec 31, |
|
|
|
2021 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
2021 |
|
|
|
2020 |
|
Net earnings on GAAP
basis |
|
$ |
67.7 |
|
|
$ |
74.5 |
|
|
$ |
87.9 |
|
|
|
$ |
142.1 |
|
|
$ |
134.2 |
|
Income taxes |
|
|
11.7 |
|
|
|
16.0 |
|
|
|
18.4 |
|
|
|
|
27.7 |
|
|
|
31.7 |
|
Depreciation and amortization |
|
|
71.0 |
|
|
|
69.7 |
|
|
|
67.2 |
|
|
|
|
140.7 |
|
|
|
131.9 |
|
Interest expense |
|
|
17.1 |
|
|
|
12.2 |
|
|
|
15.6 |
|
|
|
|
29.3 |
|
|
|
32.8 |
|
EBITDA
(1) |
|
$ |
167.4 |
|
|
$ |
172.4 |
|
|
$ |
189.1 |
|
|
|
$ |
339.8 |
|
|
$ |
330.6 |
|
EBITDA margin |
|
|
20.7 |
% |
|
|
21.7 |
% |
|
|
24.0 |
% |
|
|
|
21.2 |
% |
|
|
21.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Stock based compensation |
|
|
18.7 |
|
|
|
22.7 |
|
|
|
28.1 |
|
|
|
|
41.4 |
|
|
|
43.6 |
|
Foreign currency exchange (gains) losses |
|
|
0.2 |
|
|
|
(4.9 |
) |
|
|
7.5 |
|
|
|
|
(4.7 |
) |
|
|
12.2 |
|
Start-up costs |
|
|
11.3 |
|
|
|
— |
|
|
|
— |
|
|
|
|
11.3 |
|
|
|
— |
|
Debt extinguishment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
24.7 |
|
Gain on investment |
|
|
— |
|
|
|
— |
|
|
|
(7.0 |
) |
|
|
|
— |
|
|
|
(7.0 |
) |
Restructuring, integration, and transaction expenses (1) |
|
|
13.5 |
|
|
|
12.0 |
|
|
|
5.5 |
|
|
|
|
25.5 |
|
|
|
7.6 |
|
Adjusted
EBITDA (2) |
|
$ |
211.0 |
|
|
$ |
202.2 |
|
|
$ |
223.1 |
|
|
|
$ |
413.2 |
|
|
$ |
411.7 |
|
Adjusted EBITDA margin |
|
|
26.2 |
% |
|
|
25.4 |
% |
|
|
28.4 |
% |
|
|
|
25.8 |
% |
|
|
27.2 |
% |
*Amounts may not recalculate
due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
EBITDA is defined as earnings before interest, income taxes,
depreciation and amortization. |
(2) |
Adjusted EBITDA excludes
non-GAAP adjustments for share-based compensation, certain one-time
restructuring, integration, and transaction expenses, debt
extinguishment charges, start-up costs, and the impact of foreign
currency exchange gains and losses. |
Table 6 |
|
|
|
|
|
|
|
|
|
|
|
GAAP Earnings Per
Share Calculation |
|
|
|
|
|
|
|
|
|
|
|
$
Millions |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
Dec 31, |
|
Dec 31, |
|
|
|
2021 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
2021 |
|
|
|
2020 |
|
Numerator |
|
|
|
|
|
|
|
|
|
|
|
Net earnings |
|
$ |
67.7 |
|
|
$ |
74.5 |
|
|
$ |
87.9 |
|
|
|
$ |
142.1 |
|
|
$ |
134.2 |
|
Deduct Series A preferred stock dividends |
|
|
(6.9 |
) |
|
|
(6.9 |
) |
|
|
(6.9 |
) |
|
|
|
(13.8 |
) |
|
|
(13.3 |
) |
Deduct Series B redeemable preferred dividends |
|
|
(9.8 |
) |
|
|
(10.2 |
) |
|
|
— |
|
|
|
|
(20.0 |
) |
|
$ |
— |
|
Basic earnings
available to common shareholders |
|
$ |
51.0 |
|
|
$ |
57.4 |
|
|
$ |
81.0 |
|
|
|
$ |
108.3 |
|
|
$ |
120.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of dilutive
securities: |
|
|
|
|
|
|
|
|
|
|
|
Add back interest on II-VI Convertible Notes |
|
$ |
0.6 |
|
|
$ |
0.5 |
|
|
$ |
3.1 |
|
|
|
$ |
1.1 |
|
|
$ |
6.1 |
|
Diluted earnings
available to common shareholders |
|
$ |
51.5 |
|
|
|
57.9 |
|
|
$ |
84.1 |
|
|
|
$ |
109.4 |
|
|
$ |
127.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominator |
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares |
|
|
106.2 |
|
|
|
105.8 |
|
|
|
104.1 |
|
|
|
|
106.0 |
|
|
|
103.5 |
|
Effect of dilutive
securities: |
|
|
|
|
|
|
|
|
|
|
|
Common stock equivalents |
|
|
3.0 |
|
|
|
2.8 |
|
|
|
3.6 |
|
|
|
|
2.9 |
|
|
|
3.0 |
|
II-VI Convertible Notes |
|
|
7.3 |
|
|
|
7.3 |
|
|
|
7.3 |
|
|
|
|
7.3 |
|
|
|
7.3 |
|
Diluted weighted
average common shares |
|
|
116.4 |
|
|
|
115.8 |
|
|
|
115.1 |
|
|
|
|
116.1 |
|
|
|
113.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
common share |
|
$ |
0.48 |
|
|
$ |
0.54 |
|
|
$ |
0.78 |
|
|
|
$ |
1.02 |
|
|
$ |
1.17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share |
|
$ |
0.44 |
|
|
$ |
0.50 |
|
|
$ |
0.73 |
|
|
|
$ |
0.94 |
|
|
$ |
1.12 |
|
*Amounts may not recalculate
due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 7 |
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Earnings Per
Share Calculation |
|
|
|
|
|
|
|
|
|
|
|
$
Millions |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Dec 31, |
|
Sept 30, |
|
Dec 31, |
|
|
Dec 31, |
|
Dec 31, |
|
|
|
2021 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
2021 |
|
|
|
2020 |
|
Numerator |
|
|
|
|
|
|
|
|
|
|
|
Net earnings on non-GAAP basis |
|
$ |
124.1 |
|
|
$ |
117.7 |
|
|
$ |
131.2 |
|
|
|
$ |
241.8 |
|
|
$ |
231.6 |
|
Deduct Series A preferred stock dividends |
|
|
(6.9 |
) |
|
|
(6.9 |
) |
|
|
(6.9 |
) |
|
|
|
(13.8 |
) |
|
|
(13.3 |
) |
Deduct Series B redeemable preferred dividends |
|
|
(9.8 |
) |
|
|
(10.2 |
) |
|
|
— |
|
|
|
|
(20.0 |
) |
|
|
— |
|
Basic earnings
available to common shareholders |
|
$ |
107.4 |
|
|
$ |
100.6 |
|
|
$ |
124.3 |
|
|
|
$ |
208.0 |
|
|
$ |
218.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of dilutive
securities: |
|
|
|
|
|
|
|
|
|
|
|
Add back interest on II-VI Convertible Notes |
|
$ |
0.6 |
|
|
$ |
0.5 |
|
|
$ |
3.1 |
|
|
|
$ |
1.1 |
|
|
$ |
6.2 |
|
Add back Series A preferred stock dividends |
|
|
6.9 |
|
|
|
6.9 |
|
|
|
6.9 |
|
|
|
|
13.8 |
|
|
|
13.3 |
|
Diluted earnings
available to common shareholders |
|
$ |
114.9 |
|
|
$ |
108.0 |
|
|
$ |
134.2 |
|
|
|
$ |
222.9 |
|
|
$ |
237.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominator |
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares |
|
|
106.2 |
|
|
|
105.8 |
|
|
|
104.1 |
|
|
|
|
106.0 |
|
|
|
103.5 |
|
Effect of dilutive
securities: |
|
|
|
|
|
|
|
|
|
|
|
Common stock equivalents |
|
|
3.0 |
|
|
|
2.8 |
|
|
|
3.6 |
|
|
|
|
2.9 |
|
|
|
3.0 |
|
II-VI Convertible Notes |
|
|
7.3 |
|
|
|
7.3 |
|
|
|
7.3 |
|
|
|
|
7.3 |
|
|
|
7.3 |
|
Series A Mandatory Convertible Preferred Stock |
|
|
8.9 |
|
|
|
8.9 |
|
|
|
8.9 |
|
|
|
|
8.9 |
|
|
|
8.9 |
|
Diluted weighted
average common shares |
|
|
125.4 |
|
|
|
124.8 |
|
|
|
124.0 |
|
|
|
|
125.1 |
|
|
|
122.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
common share on non-GAAP basis |
|
$ |
1.01 |
|
|
$ |
0.95 |
|
|
$ |
1.19 |
|
|
|
$ |
1.96 |
|
|
$ |
2.11 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share on non-GAAP basis |
|
$ |
0.92 |
|
|
$ |
0.87 |
|
|
$ |
1.08 |
|
|
|
$ |
1.78 |
|
|
$ |
1.94 |
|
*Amounts may not recalculate
due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 8 |
|
|
|
|
|
|
Example
EPS Calculations (1) |
|
$
Millions |
|
|
|
|
|
|
|
|
Hypothetical Earnings Level for Q2 FY22 |
Non-GAAP net earnings |
|
$ |
104.0 |
|
|
$ |
116.0 |
|
|
$ |
129.0 |
|
Deduct Series A preferred stock dividends |
|
$ |
(6.9 |
) |
|
|
— |
|
|
|
— |
|
Deduct Series B redeemable preferred dividends |
|
$ |
(10.2 |
) |
|
$ |
(10.2 |
) |
|
$ |
(10.2 |
) |
Add back interest on II-VI Convertible Notes |
|
$ |
0.6 |
|
|
$ |
0.6 |
|
|
$ |
0.6 |
|
Non-GAAP net earnings available to common
shareholders |
|
$ |
87.4 |
|
|
$ |
106.3 |
|
|
$ |
119.3 |
|
Diluted weighted
average common shares |
|
|
116.0 |
|
|
|
125.0 |
|
|
|
125.0 |
|
Diluted earnings per
common share on non-GAAP basis |
|
$ |
0.75 |
|
|
$ |
0.85 |
|
|
$ |
0.95 |
|
(1) |
The Company
does not provide reconciliations of the hypothetical non-GAAP net
earnings and hypothetical diluted non-GAAP EPS presented in this
table. This table contains purely hypothetical figures, which are
provided solely to illustrate how the Company would calculate
diluted non-GAAP EPS under different factual scenarios. |
CONTACT:
Mary Jane RaymondTreasurer and Chief Financial Officer
investor.relations@ii-vi.com www.ii-vi.com/contact-us
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