ADVANCED ENERGY INDUSTRIES, INC. Powering the
4th Industrial Revolution
FALL 2020
Copyright © 2020 Advanced Energy
SAFE HARBOR
The company's guidance with respect to anticipated financial results for future periods, potential future growth and profitability, future business mix, expectations regarding future market trends, future performance within specific markets and other statements herein or made on the conference call that are not historical information are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to: (a) the effects of global macroeconomic conditions upon demand for our products and services; (b) the volatility and cyclicality of the industries the company serves, particularly the semiconductor industry; (c) delays in capital spending by end-users in our served markets; (d) the risks and uncertainties related to the acquisition and integration of Artesyn Embedded Power including the optimization and reduction of our global manufacturing sites; (e) the continuing spread of COVID-19 and its potential adverse impact on our product manufacturing, supply chain and operations; (f) the accuracy of the company's estimates related to fulfilling solar inverter product warranty and post-warranty obligations; (g) the company's ability to realize its plan to avoid additional costs after the solar inverter wind- down; (h) the accuracy of the company's assumptions on which its financial statement projections are based; (i) the impact of product price changes, which may result from a variety of factors; (j) the timing of orders received from customers; (k) the company's ability to realize benefits from cost improvement efforts including avoided costs, restructuring plans and inorganic growth; (l) the company's ability to obtain in a timely manner the materials necessary to manufacture its products; (m) unanticipated changes to management's estimates, reserves or allowances; (n) changes and adjustments to the tax expense and benefits related to the U.S. tax reform that was enacted in late 2017; and (o) the effects of U.S. government trade and export restrictions, Chinese retaliatory trade actions, and other governmental action related to tariffs upon the demand for our, and our customers', products and services and the U.S.
economy. These and other risks are described in Advanced Energy's Form 10 K, Forms 10 Q and other reports and statements filed with the Securities and
Exchange Commission (the "SEC"). These reports and statements are available on the SEC's website at www.sec.gov. Copies may also be obtained from Advanced Energy's investor relations page at ir.advanced-energy.com or by contacting Advanced Energy's investor relations at 970 407 6555. Forward- looking statements are made and based on information available to the company on the date of this press release. Aspirational goals and targets discussed on the conference call or in the presentation materials should not be interpreted in any respect as guidance. The company assumes no obligation to update the information in this presentation.
Copyright © 2020 Advanced Energy | 2 |
POWERING THE 4TH
INDUSTRIAL REVOLUTION
- MARKET LEADER in precision power solutions
- GROWING share and content across core markets
- BROADENING market presence through inorganic investments
- ACCELERATING earnings growth and Return on Invested Capital
Copyright © 2020 Advanced Energy | 3 |
WE ARE A PURE PLAY POWER LEADER
Leader in precision power conversion and control with wide range of
technologies, products and applications
Copyright © 2020 Advanced Energy | 4 |
ADDRESSING CRITICAL MARKETS IN THE DATA ECONOMY
Combined SAM of $9.0 billion(1)
Pro Forma 2019 Revenues
SEMICONDUCTOR | INDUSTRIAL & | DATA CENTER | TELECOM & |
EQUIPMENT | MEDICAL | COMPUTING | NETWORKING |
$1.7 billion | $3.7 billion | $1.9 billion | $1.7 billion |
Etch, Deposition, | Medical, Life Sciences, | Hyperscale, | Base Stations, Tower |
Thermal, Ion Implant, | Analytical Instruments, | Data Center, | Radio, 4G LTE & 5G |
Epi, ECD, Inspection & | Test & Measurement, | Cloud & Edge | Cellular Infrastructure, |
Metrology, Semi ATE, | Material Processing, | Computing, Enterprise | Enterprise Networking, |
Advanced Packaging | Thermal Processing, | Server & Storage | Wireless & Wireline |
Motion Control, | Systems | Communication | |
Robotics, Horticulture |
(1) Source: Omida Power Supply Market Report, August 2019 and AE estimates; note: Semiconductor Equipment SAM is | Copyright © 2020 Advanced Energy | 5 |
based on mid-cycle WFE, other markets are based on 2019 estimates
POWERING THE FOURTH INDUSTRIAL REVOLUTION
APPLICATIONS
INDUSTRIES
Advanced Power Products: Deliver precise power, control and measurement of processes
ADVANCED | RF | DC | High Voltage | SCR Power | ||
RPS | Photonics | |||||
Systems | Generator | System | Controller | |||
Embedded Power Products: Provide stable and efficient power for mission critical applications
EMBEDDED | Power | |||||
Power | AC-DC | Configurable | DC-DC | HVDC | ||
Systems | Shelves | |||||
Copyright © 2020 Advanced Energy | 6 |
LEADING MARKET POSITIONS ACROSS OUR VERTICALS
SEMICONDUCTOR | INDUSTRIAL & | DATA CENTER | TELECOM & |
EQUIPMENT | MEDICAL | COMPUTING | NETWORKING |
SAM = $1.7 billion | SAM = $3.7 billion | SAM = $1.9 billion | SAM = $1.7 billion |
Top 5 Players(1): | Top 5 Players(1): | Top 5 Players(1): | Top 5 Players(1): | |||||
Advanced Energy | TDK-Lambda | Delta Electronics | Delta Electronics | |||||
Daihen Corp | Advanced Energy | Advanced Energy | Advanced Energy | |||||
Comet Group | MEAN WELL | Lite-On Technology | Vapel | |||||
MKS Instruments | Delta Electronics | Vicor Corp | Murata Manufacturing | |||||
TRUMPF Hüttinger | Cosel | Acbel Polytech | Lite-On Technology |
(1) Source: Omida Power Supply Market Report, August 2020, company public filings and AE estimates | 7 |
Copyright © 2020 Advanced Energy |
A HISTORY OF INNOVATION AND
TECHNOLOGY LEADERSHIP
RightPower
AE RightPower™: AE's technology innovation
- Transformative and holistic approach to power delivery innovation
- Enabling solutions that deliver precise electrical energy optimized for targeted applications
Copyright © 2020 Advanced Energy | 8 |
TRANSFORMING INTO A DIVERSIFIED POWER LEADER
Deployed $568M | • Expanded our SAM by >4X | NG EPS accretion targets(2) |
adding >$750M of | • A repeatable model in the large and fragmented power conversion market | 18-24 months: >$0.80 |
pro forma revenue(1) | • Artesyn integration - executing our synergies targets | Long-term: >$1.50 |
(1) | Pro-forma annualized revenue | Copyright © 2020 Advanced Energy | 9 |
(2) | EPS accretion based on non-GAAP measures as defined by our synergy targets |
ARTESYN - A HIGHLY STRATEGIC AND
TRANSFORMATIVE ACQUISITION
GLOBAL PLATFORM | STRATEGIC FIT | ACCELERATED NG EPS GROWTH | ||
Revenue | EPS Accretion(1) |
WAS | NOW | Initial | Near-TermLong-Term | |
GLOBAL PRESENCE ACROSS | HIGHLY COMPLEMENTARY AND | DRIVEN BY SYNERGIES OF >$20M | ||
TECHNOLOGIES AND MARKETS | SHARED CORE COMPETENCIES | NEAR-TERM AND >$40M LONG-TERM |
EXPAND SAM BY ALMOST 4X | BROADENS AND DIVERSIFIES | ATTRACTIVE DEAL ECONOMICS | |||
SAM | Mix | Synergy-Adjusted EBITDA Multiple(2) |
5x | |||||
WAS | NOW | ||||
ADDING NEW VERTICALS AND CROSS | MULTIPLE, STABLE GROWTH | WITH MEANINGFUL OPPORTUNITY | |||
SELLING OPPORTUNITES | VERTICALS AND CUSTOMERS | FOR MARGIN EXPANSION |
(1) | All synergies and accretions are on non-GAAP basis; please see our non-GAAP and Adjusted Financial Measure statement for more details | Copyright © 2020 Advanced Energy | 10 |
(2) | Transaction value divided by 2018 EBITDA plus pre-tax synergies of $20 million | ||
TARGETED GROWTH STRATEGY
GROW SHARE ACROSS | INVEST IN | LEVERAGE STRONG |
MISSION CRITICAL, | INNOVATION | FINANCIALS AND INCREASED |
PRECISION POWER | AND TECHNOLOGY | SCALE TO CAPITALIZE ON |
VERTICALS | LEADERSHIP | NEW OPPORTUNITIES |
• Expand content in semiconductor | • RF power leadership | • Cross selling |
• Grow in hyperscale data centers | • AE RightPower solutions | • New market verticals |
• Capitalize on 5G migration | • Power efficiency and density | • New joint product offerings |
• Broaden industrial and medical | • Drive Industry 4.0 adoption | • Inorganic growth |
footprint |
Copyright © 2020 Advanced Energy | 11 |
Semiconductor
AE PROCESS POWER ENABLES SEMI NODE TRANSITIONS
Process
Challenges
3D Memory - small/deep holes
>70:1 aspect ratios
Memory stacking
Layer uniformity in thick stack
Atomic-scale logic features
Sidewalls and holes
Complex 3D shapes
3D transistors <10nm
High selectivity
Etch only what you want
Low stress in 3D and packaging
Flat vs. potato chips
Power Trends
Etch
- Tune-while-pulsing
- Higher energy
Deposition
- Higher frequency
- Shorter processes
Fragile films
- Low power accuracy
- Lower frequencies
AE RightPower
- Integrated power topology
- Power metrology
- Control algorithms
- Connectivity
- Advanced control & pulsing
Beyond RF
- Mono-energeticcontrol
- Tunable energy profile
- Novel energy control
- Novel wave shaping
Semiconductor process chamber
(i.e., etching a wafer)
AE Navigator II
RF match
AE RF | AE RF |
generator 1 | generator 2 |
EVoS Delivers beyond RF Power
AE First with Solutions for Power - First to Power Solutions
Copyright © 2020 Advanced Energy | 12 |
Semiconductor
POWERING MORE OF THE
PROCESS
New
$150M
SAM
Processes
Core AE Innovation
Technologies acquired
in last 5 years
New SAM expansion
New
$170M
SAM
AE RightPower Delivers Broader Integrated Solutions … While Adding >$750M SAM
Copyright © 2020 Advanced Energy | 13 |
Industrial & Medical
POWERING 4IR & GROWTH IN MEDICAL
FAVORABLE MARKET
GROWTH TREND
Industry 4.0 End Market(1)
($ in billions) $150
$100
$50
$0
2014 | 2017 | 2020 | 2022 |
- Industry 4.0 related investments expected to grow at a 15%+ CAGR(1)
- Explosive growth in autonomous and collaborative robots at 50%+ CAGR(1)
- Increased use of power in diagnostic and therapeutic applications
GROWTH
STRATEGY
- Expand standard product portfolio to serve Industry 4.0 applications
- Cross sell data center products into industrial edge applications
- Broaden product portfolio and expand channel in medical
WHY WE WIN
- Industry-leadingportfolio of configurable power platforms
- Growing software capability for monitoring and control
Standard with | Most advanced |
growing SW | configurable power supply |
(2)
- Source: Markets and Markets, Industry 4.0 Market report and Robot Market Sizes Report
- Photo source: Universal Robots
Copyright © 2020 Advanced Energy | 14 |
Data Center Computing
FOCUS ON HYPERSCALE
FAVORABLE MARKET
GROWTH TREND
Hyperscale infrastructure end market(1)
($ in billions)
$25
$20
$15
$10
$5
$0
2017 2018 2019 2020 2021 2022
- Hyperscale growing at 15% CAGR(1)
- Increasing data center traffic and IoT trends drive edge investment
- Increased workload driven by Artificial Intelligence and Machine Learning
GROWTH
STRATEGY
- Launch market-leading efficiency products
- Accelerate time-to-market with standard data center power supplies
- Expand customer base to original design manufacturers
WHY WE WIN
- Industry-leadingefficiency and density
- Trusted brand with 1M+ units shipped
- Significant design wins at majority of Tier 1 hyperscalers
- Strong reputation with deep engineering relationships
Technology leadership: 98% power efficiency
Efficiency | 94% | 96% | 98% |
No. of | 15+ | ~7 | 2 |
leading | AE | AE | AE |
suppliers |
High technical
challenges
reduce
competition
Server front-end density leadership
Competitor X
Competitor Y
AE
Up to 30% smaller
than competition's
- Source: Technology Business Review, Data Center Server and Storage Market Forecast, 2018
Copyright © 2020 Advanced Energy | 15 |
Telecom & Networking
TARGETING 5G INFRASTRUCTURE
FAVORABLE MARKET
GROWTH TREND
Wireless infrastructure Spend(1)
($ in billions)
$80 $70 $60 $50 $40
$305G at 105% CAGR$20$10 $0
2017 2018 2019 2020 2021 2022
- Growth returning to wireless infrastructure with 5G launch
- Increased capacity demand driven by expanding use cases
GROWTH
STRATEGY
- Ramp current programs with key Tier 1 networking customers
- Win new designs in 5G radio power for both macro cells and small cells
WHY WE WIN
- Leading reputation in high density, rugged power supplies for outdoor radio applications
- Secured significant 5G design wins across all leading base station OEMs
- Deep application knowledge and 20+ years of customer intimacy
Powering many of the largest wireless
networks across the world
High reliability
ruggedized power supply
for the harshest of
environments
(1) Source: Gartner Communications Service Provider Operational technology, 3Q19 Forecast Update
Copyright © 2020 Advanced Energy | 16 |
EARNINGS GROWTH VISION
Copyright © 2020 Advanced Energy | 17 |
LEVERAGED FINANCIAL MODEL
REVENUE | NON-GAAP OP INCOME | NON-GAAP EPS | OPERATING CASH FLOW | ||||||||||||||||||||||||
($ in millions) | ($ in millions) | ($ per share) | ($ in millions) | ||||||||||||||||||||||||
$400 | $80 | $1.80 | $80 | ||||||||||||||||||||||||
$300 | $60 | $1.50 | $60 | ||||||||||||||||||||||||
$1.20 | |||||||||||||||||||||||||||
$200 | $40 | $40 | |||||||||||||||||||||||||
$0.90 | |||||||||||||||||||||||||||
$100 | $20 | $0.60 | $20 | ||||||||||||||||||||||||
$0.30 | |||||||||||||||||||||||||||
$0 | $0 | $0 | |||||||||||||||||||||||||
$0.00 | |||||||||||||||||||||||||||
Copyright © 2020 Advanced Energy | 18 |
SYNERGY & SCALE ENABLE ACCELERATED EARNINGS GROWTH
>$6.50
Long-Term
Non-GAAP
EPS Goal(2)
+$0.40
+$0.75-$1.25
Synergies
+$0.50-$1.00
Share
+$0.25-$0.75growth
+$1.00-$1.50Innovation
$2.44Market
Growth
2019 NON-
GAAP EPS
+$0.25-$0.75Artesyn
Accretion(1)
SAM
expansion
A clear path to accelerate earnings from current levels
(1) | $0.40 annualized, net of interest expense, partially reflected in 2019 | Copyright © 2020 Advanced Energy | 19 |
(2) | This figure represents our aspirational goal and is not to be treated as guidance | ||
LEAN OPERATIONS ENABLE TOP QUARTILE ROIC
COMPARISON OF ROIC BETWEEN AEIS AND PUBLICALLY-TRADED PEERS
BASED ON TRAILING FOUR QUARTER RESULTS
30% | ||||
25% | Long-term Target | |||
20% | ||||
Current L4Q Actuals | ||||
15% | ||||
10% | ||||
5% | ||||
0% | ||||
-5% | ||||
AEIS | Semiconductor | Semiconductor equipment | Power solutions | Diversified industrial technology |
equipment suppliers | subsystem & component peers | peers | companies |
(1) AEIS ROIC includes Artesyn pro forma results. ROIC calculated as Non-GAAP Operating Income After Tax divided by Invested Capital, which is | Copyright © 2020 Advanced Energy | 20 |
defined as Total Assets less Cash, Payables, Accrued Expenses. | ||
CAPITAL ALLOCATION AND
BALANCE SHEET
NEAR-TERM CAPITAL ALLOCATION PLAN
- Targeting organic and inorganic growth opportunities
- Gross debt achieved target of 1.0-1.5x
- End of Q3 at 1.3x(1)
- Maintain opportunistic share repurchase to offset dilution over time
Debt Reduction /
Inorganic Growth
70%
Shareholder
Return
30%
Position balance sheet to support continued inorganic growth
(1) Gross debt of 326.3 million at the end of Q2'20 divided by L4Q adjusted EBITDA of $243.6 | Copyright © 2020 Advanced Energy | 21 |
million. Adjusted EBITDA is calculated as non-GAAP operating income plus depreciation. | ||
THREE-YEAR ASPIRATIONAL GOALS
Generate &
Deploy Cash
Aspirational Goals(1) :
• Revenue: | > $1.5B |
- Non-GAAPEPS(2) : > $6.50
• ROIC(3) : | > 23% |
- Please note that hypothetical scenarios regarding revenue growth, EBITDA, EPS, (GAAP or non-GAAP), ROIC, cash generation, acquisitions, aspirational goals and targets and similar statements illustrate various possible outcomes of our different strategies if they are successful. These hypothetical scenarios and illustrations should not be treated as forecasts or projections or financial guidance. We cannot assure you that we will be able to accomplish any of these goals, metrics or opportunities at any point in the future (if at all), all of which are subject to significant risks and uncertainties. Long-term targets generally reflect a 3-4 year time frame, depending on the timing of the semi recovery.
- Refer to the non-GAAP reconciliation for additional detail.
- ROIC calculated as Non-GAAP Operating Income After Tax divided by Invested Capital, which is defined as Total Assets less Cash, Payables, Accrued Expenses
Grow &
Diversify
Drive Strong
Profitability
Copyright © 2020 Advanced Energy | 22 |
POWERING THE 4TH
INDUSTRIAL REVOLUTION
- MARKET LEADER in precision power solutions
- GROWING share and content across core markets
- BROADENING market presence through inorganic investments
- ACCELERATING earnings growth and Return on Invested Capital
Copyright © 2020 Advanced Energy | 23 |
THANK YOU
Copyright © 2020 Advanced Energy
NON-GAAP MEASURES
- Advanced Energy's non-GAAP measures exclude the impact of non-cash related charges such as stock-based compensation and amortization of intangible assets, as well as discontinued operations, minority interest, and non-recurring items such as acquisition- related costs and restructuring expenses. The non-GAAP measures are not in accordance with, or an alternative for, similar measures calculated under generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Advanced Energy believes that these non-GAAP measures provide useful information to management and investors to evaluate business performance without the impacts of certain non-cash charges and other charges which are not part of the company's usual operations. The company uses these non-GAAP measures to assess performance against business objectives, make business decisions, develop budgets, forecast future periods, assess trends and evaluate financial impacts of various scenarios. In addition, management's incentive plans include these non-GAAP measures as criteria for achievements. Additionally, the company believes that these non-GAAP measures, in combination with its financial results calculated in accordance with GAAP, provide investors with additional perspective. While some of the excluded items may be incurred and reflected in the company's GAAP financial results in the foreseeable future, the company believes that the items excluded from certain non-GAAP measures do not accurately reflect the underlying performance of its continuing operations for the period in which they are incurred. The use of non-GAAP measures has limitations in that such measures do not reflect all of the amounts associated with the company's results of operations as determined in accordance with GAAP, and these measures should only be used to evaluate the company's results of operations in conjunction with the corresponding GAAP measures. Please refer to the Form 8-K regarding this presentation furnished today to the Securities and Exchange Commission.
Copyright © 2020 Advanced Energy | 25 |
NON-GAAP RECONCILIATION
Twelve months ended December 31, | |||||||||||
2016 | 2017 | 2018 | 2019 | ||||||||
Revenue | $ | 483.7 | $ | 671.0 | $ | 718.9 | $ | 788.9 | |||
GAAP Operating Income | $ | 126.9 | $ | 200.8 | $ | 171.6 | $ | 54.4 | |||
Add back: | |||||||||||
Restructuring Charges | - | - | 4.2 | 5.0 | |||||||
Acquisition-related Costs | - | 0.2 | 2.3 | 20.3 | |||||||
Stock-based Compensation | 6.3 | 12.5 | 9.7 | 7.3 | |||||||
Amortization of Intangible Assets | 4.2 | 4.4 | 5.8 | 12.2 | |||||||
Facility Transition and Relocation Costs | - | - | 1.8 | 4.8 | |||||||
Non-GAAP Operating Income | $ | 137.4 | $ | 217.8 | $ | 195.4 | $ | 104.0 | |||
Non-GAAP Operating Margin % of Revenue | 28.4% | 32.5% | 27.2% | 13.2% |
Twelve months ended December 31, | |||||||||||||
2016 | 2017 | 2018 | 2019 | ||||||||||
GAAP Income from Continuing Operations | $ | 116.9 | $ | 136.1 | $ | 147.1 | $ | 56.5 | |||||
Add back: | |||||||||||||
Restructuring Charges | - | - | 4.2 | 5.0 | |||||||||
Acquisition-related Costs | - | 0.2 | 2.3 | 20.3 | |||||||||
Stock-based Compensation | 6.3 | 12.5 | 9.7 | 7.3 | |||||||||
Amortization of Intangible Assets | 4.2 | 4.4 | 5.8 | 12.2 | |||||||||
Loss on Foreign Exchange Hedge | - | 3.5 | - | - | |||||||||
Facility Transition and Relocation Costs | - | - | 1.8 | 4.8 | |||||||||
Incremental Expense Associated with Start-up of the Asia Regional Headquarters | - | 1.1 | - | - | |||||||||
Nonrecurring Tax (Benefit) Expense Associated with Inverter Business | - | (33.8) | - | - | |||||||||
Central inverter services business sale | - | - | - | (13.7) | |||||||||
Tax Cuts and Jobs Act Impact | - | 72.9 | 5.7 | - | |||||||||
Tax Effect of Non-GAAP Adjustments | (2.9) | (5.3) | (4.6) | 1.5 | |||||||||
Non-GAAP Net Income | $ | 124.6 | $ | 191.5 | $ | 172.0 | $ | 93.9 | |||||
Share Outstanding (Millions) | 40.0 | 40.2 | 39.4 | 38.5 | |||||||||
Non-GAAP EPS | $ | 3.11 | $ | 4.77 | $ | 4.37 | $ | 2.44 | |||||
Copyright © 2020 Advanced Energy | 26 |
NON-GAAP RECONCILIATION
Reconciliation of Non-GAAP measure | |||||||||||||
- operating expenses and operating | |||||||||||||
income, excluding certain items | Three Months Ended | Nine Months Ended | |||||||||||
September 30, | June 30, | September 30, | |||||||||||
2020 | 2019 | 2020 | 2020 | 2019 | |||||||||
Gross profit from continuing operations, | |||||||||||||
as reported | $ | 153,785 | $ 73,491 | $ | 130,304 | $ 396,320 | $ | 203,357 | |||||
Adjustments to gross profit: | |||||||||||||
Stock-based compensation | 67 | 77 | 156 | 445 | 365 | ||||||||
Facility expansion, relocation costs and | |||||||||||||
other | 1,095 | 1,342 | 970 | 3,608 | 1,662 | ||||||||
Acquisition-related costs | - | 1,506 | 215 | 5,356 | 1,506 | ||||||||
Non-GAAP gross profit | 154,947 | 76,416 | 131,645 | 405,729 | 206,890 | ||||||||
Non-GAAP gross margin | 39.8% | 43.6% | 38.7% | 38.8% | 45.9% | ||||||||
Operating expenses from continuing | |||||||||||||
operations, as reported | 94,831 | 64,101 | 94,828 | 276,082 | 171,171 | ||||||||
Adjustments: | |||||||||||||
Amortization of intangible assets | (5,049) | (3,002) | (5,009) | (15,064) | (6,849) | ||||||||
Stock-based compensation | (3,714) | (840) | (2,681) | (9,221) | (4,688) | ||||||||
Acquisition-related costs | (5,214) | (6,398) | (2,978) | (10,597) | (9,440) | ||||||||
Facility expansion, relocation costs and | |||||||||||||
other | (415) | (223) | (539) | (1,770) | (297) | ||||||||
Restructuring charges | (1,494) | (152) | (5,790) | (7,940) | (3,620) | ||||||||
Non-GAAP operating expenses | 78,945 | 53,486 | 77,831 | 231,490 | 146,277 | ||||||||
Non-GAAP operating income | $ | 76,002 | $ 22,930 | $ | 53,814 | $ 174,239 | $ | 60,613 | |||||
Non-GAAP operating margin | 19.5% | 13.1% | 15.8% | 16.7% | 13.4% |
Reconciliation of Non-GAAP measure - | |||||||||||||
income excluding certain items | Three Months Ended | Nine Months Ended | |||||||||||
September 30, | June 30, | September 30, | |||||||||||
2020 | 2019 | 2020 | 2020 | 2019 | |||||||||
Income from continuing operations, less | |||||||||||||
noncontrolling interest, net of income taxes | $ 45,577 | $ | 7,246 | $ 29,295 | $ | 93,255 | $ | 45,987 | |||||
Adjustments: | |||||||||||||
Amortization of intangible assets | 5,049 | 3,002 | 5,009 | 15,064 | 6,849 | ||||||||
Acquisition-related costs(1) | 5,565 | 7,875 | 3,193 | 16,304 | 10,917 | ||||||||
Facility expansion, relocation costs and | |||||||||||||
other(2) | 1,784 | 1,565 | 1,509 | 5,652 | 1,959 | ||||||||
Restructuring charges | 1,494 | 152 | 5,790 | 7,940 | 3,620 | ||||||||
Unrealized foreign currency (gain) loss | 3,540 | - | 1,058 | 4,598 | - | ||||||||
Central inverter services business sale | - | - | - | - | (14,804) | ||||||||
Tax effect of Non-GAAP adjustments | (2,115) | 326 | (2,595) | (6,080) | 2,011 | ||||||||
Non-GAAP income, net of income taxes, | |||||||||||||
excluding stock-based compensation | 60,894 | 20,166 | 43,259 | 136,733 | 56,539 | ||||||||
Stock-based compensation, net of taxes | 2,892 | 702 | 2,170 | 7,425 | 3,887 | ||||||||
Non-GAAP income, net of income taxes | $ 63,786 | $ | 20,868 | $ 45,429 | $ | 144,158 | $ | 60,426 |
- For the three and nine months ended September 30, 2020, and 2019, Acquisition-related costs include an expense of $351 and a gain of $29, respectively, which was recognized in Other income (expense), net.
- For the three and nine months ended September 30, 2020 and 2019, Facility expansion, relocation costs and other includes a $274 noncash fixed asset write-off, which was recognized in Other income (expense), net.
Reconciliation of Non-GAAP measure - per | ||||||||||||||
share earnings excluding certain items | Three Months Ended | Nine Months Ended | ||||||||||||
September 30, | June 30, | September 30, | ||||||||||||
2020 | 2019 | 2020 | 2020 | 2019 | ||||||||||
Diluted earnings per share from continuing | ||||||||||||||
operations, as reported | $ | 1.18 | $ | 0.19 | $ | 0.76 | $ | 2.42 | $ | 1.20 | ||||
Add back (subtract): | ||||||||||||||
Per share impact of Non-GAAP adjustments, | ||||||||||||||
net of tax | 0.48 | 0.35 | 0.42 | 1.32 | 0.37 | |||||||||
Non-GAAP per share earnings | $ | 1.66 | $ | 0.54 | $ | 1.18 | $ | 3.74 | $ | 1.57 |
Copyright © 2020 Advanced Energy | 27 |
RECONCILIATION OF Q4 2020 GUIDANCE
Low End | High End | ||
Revenue | $340M | - | $380M |
Reconciliation of non-GAAP* earnings per share | |||
GAAP earnings per share | $0.82 | - | $1.24 |
Stock-based compensation | $0.08 | - | $0.08 |
Amortization of intangible assets | $0.13 | - | $0.13 |
Restructuring and other | $0.11 | - | $0.09 |
Tax effects of excluded items | -$0.04 | - | -$0.04 |
Non-GAAP* earnings per share | $1.10 | - | $1.50 |
Copyright © 2020 Advanced Energy | 28 |
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AE - Advanced Energy Industries Inc. published this content on 09 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 12 November 2020 14:06:05 UTC
