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SMT & Inspection | August 07, 2006

Orbotech presents increasing revenue

Orbotech Ltd. today announced its consolidated financial results for the second quarter and six months ended June 30, 2006. Revenues for the second quarter of 2006 totaled $104.9 million, compared to $101.4 million recorded in the first quarter of 2006 and $89.3 million in the second quarter a year ago.
Net income for the second quarter of 2006 was $15.3 million, or $0.46 per share (diluted), compared to net income of $14.1 million, or $0.43 per share (diluted), in the first quarter of 2006 and $9.5 million, or $0.29 per share (diluted), in the second quarter of 2005.

These results reflect the adoption, on January 1, 2006, of revised Financial Accounting Standard No.123, 'Share Based Payment', which resulted in increased compensation expenses totaling approximately $1.4 million, without any reduction in income taxes, and a corresponding decrease in diluted earnings per share of $0.04 for the second quarter. Excluding these compensation expenses, net income would have been $16.7 million, or $0.50 per share, for the second quarter of 2006.

Revenues for the first six months of 2006 totaled $206.3 million, compared to $189.8 million recorded in the first half of 2005. Net income for the first six months of 2006 was $29.4 million, or $0.89 per share (diluted), compared to net income of $20.1 million, or $0.61 per share (diluted), in the first six months of 2005.

Sales of equipment to the printed circuit board ('PCB') industry relating to bare PCBs were $44.0 million in the second quarter of 2006, compared to $41.0 million in the first quarter of 2006, and $35.1 million in the second quarter of 2005. Sales of flat panel display ('FPD') inspection equipment were $29.3 million, compared to $30.0 million in the first quarter of 2006, and $27.5 million in the second quarter of last year. Sales of equipment to the PCB industry relating to assembled PCBs were $9.4 million, compared to $9.2 million in the first quarter this year, and $5.4 million in the second quarter of 2005. Sales of automatic check reading products were $1.9 million in the second quarter of 2006, compared to $2.3 million in the first quarter of 2006, and $2.0 million recorded in the second quarter of 2005. In addition, service revenue for the second quarter increased to $20.1 million from $18.9 million in the first quarter of 2006, and $19.3 million in the second quarter of 2005.

The Company completed the quarter with cash, cash equivalents and marketable securities of approximately $236.1 million, compared to $207.9 million at the end of the first quarter, due principally to a positive operating cash flow for the quarter of approximately $24 million. Non-operating disbursements totaled approximately $1.6 million, comprised mainly of capital expenditures.

The increase in revenues from bare and assembled PCB equipment reflects the continued strong sales of the Company's Discovery PCB-AOI series, the Paragon solid state laser direct imaging systems and the Symbion Assembly AOI series, and contributed to another quarter of record AOI and Direct Imaging systems delivered to its customers.

In the FPD industry, several manufacturers have recently announced delays in their capacity expansion plans due to excess inventories. While this is expected to affect the Company's 2006 FPD revenues, the Company believes this will be short lived as end-user LCD product demand is expected to pick up in late 2006.

Commenting on the results, Rani Cohen, Chief Executive Officer, said: 'We are pleased with our strong financial results for the quarter, which are a reflection of our diverse product portfolio and strong operational capabilities. While the PCB industry remains strong, the FPD industry may have somewhat over-extended its capacity expansion in the short term. However, we do not anticipate any change in the long term outlook for the LCD television sector of this industry, which is still in its early stages, and believe that we are well positioned to benefit from the future growth opportunities that it will offer.'
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November 15 2018 5:25 pm V11.9.0-2