Advanced Energy Announces First Quarter Results
Advanced Energy Industries, Inc. announced financial results for the first quarter ended March 31, 2012. The company posted first quarter sales of $105.8 million compared to $112.5 million in the fourth quarter of 2011 and $137.7 million in the first quarter of 2011. Income from continuing operations was $0.8 million or $0.02 per diluted share. On a non-GAAP basis, income from continuing operations was $2.4 million and earnings per diluted share from continuing operations was $0.06. The non-GAAP measures exclude the impact of $2.6 million in restructuring charges recorded in the first quarter. A reconciliation of non-GAAP income from continuing operations and earnings per share is provided in the tables. We ended the quarter with $150.7 million in cash and investments, having generated $29.4 million of cash during the quarter excluding the share repurchase of $21.9 million.
"Exiting the first quarter we further reduced our cost structure and lowered our breakeven in both our Thin Films and Solar Energy business units," said Garry Rogerson, chief executive officer. "With most of the immediate cost reductions behind us and programs in place to better utilize our cash, we are moving ahead with the next stage of our strategic plan to improve manufacturing costs and accelerate long-term, profitable revenue growth. We remain optimistic about our growth prospects, which coupled with our ongoing cost reduction efforts should improve profitability and deliver value to our shareholders."
Thin Films sales increased 11.0% to $60.4 million in the first quarter of 2012 from $54.4 million in the fourth quarter of 2011, due to strong sales to the semiconductor market. Year-over-year, Thin Films sales declined 39.7%, from $100.1 million in the first quarter of 2011.
Solar Energy sales were $45.4 million in the seasonally weak first quarter, a decrease of 21.8% from $58.1 million in the fourth quarter. On a year-over-year basis Solar Energy sales increased 20.9% from $37.6 million due to large scale deployments in North America.
Income from continuing operations for the first quarter was $0.8 million or $0.02 per diluted share, compared to income from continuing operations of $18.8 million or $0.43 per diluted share in the same period last year and loss from continuing operations of $2.6 million or $0.06 per diluted share in the fourth quarter of 2011. On a non-GAAP basis, excluding the impact of the restructuring charge, income from continuing operations was $2.4 million or $0.06 per diluted share up from $0.5 million or $0.01 per diluted share in the fourth quarter of 2011.
The company incurred $2.6 million in charges this quarter related to the restructuring plan that was announced on September 28, 2011. During the quarter the company exited certain facilities, implemented its redesigned compensation plan and made further progress on the transfer of manufacturing of certain solar inverter subcomponents to its Shenzhen, China factory, resulting in annualized savings of approximately $14 million.
The remainder of the restructuring plan is expected to be implemented over the next 6 to 12 months as the company further reduces its cost structure, closes facilities, and relocates other functions to different regions worldwide. As a result, the company anticipates further charges in the amount of $2 to $6 million, principally for space consolidation, and another $1 million in additional severance costs over this timeframe. Once complete, the restructuring plan, along with other cost savings initiatives and margin improvements, is currently expected to deliver annual savings in excess of $30 million, well ahead of our original plan.
More news and information regarding the latest developments in Smart Grid electronics can be found at Darnell’s SmartGridElectronics.Net.