Advanced Energy increases solar sales
Advanced Energy Industries has announced financial results for the second quarter ended June 30, 2013. The company reported second quarter sales of $139.7 million compared to $111.8 million in the first quarter of 2013 and $115.7 million in the second quarter of 2012. Loss from continuing operations was $9.8 million or $0.24 per diluted share. On a non-GAAP basis, income from continuing operations was $13.9 million or $0.35 per diluted share. The non-GAAP measures exclude, on an after tax basis, $19.6 million in restructuring charges, $2.5 million of stock-based compensation and $1.6 million of intangible amortization. A reconciliation of non-GAAP income from continuing operations and earnings per share is provided in the tables below. The company ended the quarter with $99.1 million in cash and marketable securities, a decline of $83.2 million due to the recent acquisition of the three-phase string product line.
"We are pleased with our performance in the second quarter, having made significant progress on our aggressive restructuring and integration plan," said Garry Rogerson, CEO. "Improved profitability returned to our Thin Films business this quarter as we expanded into new applications, our markets recovered and we continued to reduce our costs. In our Solar Energy business we are already seeing initial demand and a growing pipeline for our newly-acquired three-phase string product line and recently-released one megawatt inverter offering. With a strong and building backlog in both business units we anticipate an acceleration of earnings per share for 2013. Our focus on successfully delivering on our strategic objectives remains our primary focus. With an efficient company-wide cost structure in place, an expanded product line and cost-effective worldwide distribution, we are laying the foundation for a successful 2014."
Solar Energy sales reached $68.0 million in the second quarter of 2013, an increase of 35.9% from $50.0 million in the first quarter of 2013, and an increase of 33.8% from $50.8 million in the second quarter of 2012. The upside was largely due to the contribution of the newly-acquired three-phase string product line.
Thin Films sales were $71.7 million in the second quarter of 2013, a 16.1% increase from $61.8 million in the first quarter of 2013, and a 10.6% increase from $64.8 million in the second quarter of 2012. The increase was driven primarily by improvement in semiconductor applications and another solid quarter in flat panel display applications.
Loss from continuing operations for the second quarter was $9.8 million or $0.24 per diluted share, compared to income from continuing operations of $6.8 million or $0.17 per diluted share in the first quarter of 2013, and income from continuing operations of $8.8 million or $0.22 per diluted share in the same period last year. On a non-GAAP basis, excluding the impact of the items mentioned above, income from continuing operations was $13.9 million or $0.35 per diluted share, up from $11.7 million or $0.29 per diluted share in the first quarter of 2013.
After the acquisition of the three-phase string product line in April 2013, the company undertook a major restructuring to take advantage of additional ongoing future cost saving opportunities. These activities include the consolidation of certain facilities, product rationalization and further centralization of manufacturing. During the second quarter, the company recorded a pre-tax restructuring charge of $24.2 million, $17.7 million of which was non-cash. The company anticipates a third quarter restructuring charge of approximately $12.0 million. Having completed roughly three quarters of the planned restructuring and integration, the company now expects to finish the majority of these actions by the end of the third quarter. The total planned charges for this initiative is expected to be in the range of $35 to $37 million, of which $25 to $29 million is expected to be non-cash in nature. We expect this restructuring to provide additional cost savings in the range of $18 to $20 million annually, including approximately $14 million of cash savings. The cost savings activities, along with those previously announced are expected to deliver annual savings of approximately $70 to $75 million by 2014. Completion of these activities should position the company well for 2014.
The company anticipates third quarter 2013 results from continuing operations to be within the following ranges:
Sales of $140 million to $150 million
Earnings per share of $0.28 to $0.32, excluding restructuring charges
Non-GAAP earnings per share of $0.36 to $0.40
