Rubicon Technology, Inc. (NASDAQ:RBCN), a leading provider of sapphire
substrates and products to the LED, semiconductor, and optical
industries, today reported financial results for its fourth quarter
ended December 31, 2014.
The Company reported fourth quarter revenue of $8.9 million, an eleven
percent increase over prior quarter revenue of $8.0 million. Demand for
the Company’s two-inch sapphire cores, primarily used in the mobile
device market and the China LED market, increased considerably in the
period but was offset in part by lower revenue from four-inch cores
sales. Four-inch material is used almost exclusively in the LED market
and fourth quarter demand was impacted by seasonality in the
backlighting segment of the LED market. PSS revenue and revenue from
optical products also increased sequentially. A table included in this
press release provides a breakdown of the Company’s revenue.
Loss per share in the fourth quarter was $0.36 as compared with prior
quarter loss of $0.53. The third quarter loss included $0.17 per share
in non-cash charges for inventory write-offs and loss on disposal of
assets.
In addition to reporting fourth quarter results, the Company provided
information on key objectives for 2015. Those objectives include
aggressively pursuing the potential of its PSS product, targeting high
margin optical applications and driving down product costs. William
Weissman, Rubicon’s CEO, commented, “We are taking action to position
Rubicon to drive strong margins when the market strengthens and also
ensure that we are cash flow positive during downturns in the market.”
More details will be provided on the Company’s earnings conference call.
First Quarter 2015 Guidance
While sapphire prices increased in the first half of 2014, pricing in
the back half of the year was driven lower by fluctuations in demand and
excess inventory in the supply chain. More recently, pricing has come
under further pressure due to the significant weakening of the Russian
ruble and Japanese yen. Commenting on the outlook for the first quarter
of 2015, Mr. Weissman said, “There remains enormous potential for
sapphire products with the growing adoption of LED lighting and use of
sapphire in mobile devices and other optical applications. However, the
sapphire market remains challenging at the moment with continued pricing
pressure and fluctuations in demand. We expect to sell higher volumes
and to begin driving down product costs in the first quarter but price
reductions will minimize the impact. As a result, we expect first
quarter 2015 results to be similar to the previous quarter. We expect
that actions we are taking now will result in a significant improvement
in both revenue and earnings by the end of the year.”
Conference Call Details
Rubicon will host a conference call at 5:00 p.m. Eastern time on
February 12, 2015 to review the fourth quarter 2014 results and the
first quarter 2015 outlook. The conference call will be available to the
public through a live audio web broadcast via the Internet. Log on
through the Investor Relations section of Rubicon's website at http://ir.rubicontechnology.com.
An audio replay of the call will be available approximately two hours
after the conclusion of the call. The audio replay will remain available
until 9:00 a.m. Eastern time on February 20, 2015, and can be accessed
by dialing (877) 344-7529 or (412) 317-0088 (international). Callers
should reference conference ID 10059814. The webcast will be archived on
the Company's website.
About Rubicon Technology, Inc.
Rubicon Technology, Inc. is a vertically integrated advanced electronic
materials provider specializing in monocrystalline sapphire
for applications in light-emitting diodes (LEDs), optical systems and
specialty electronic devices. Rubicon has a proprietary technology
platform and expertise extending from the preparation of raw aluminum
oxide through sapphire crystal growth and fabrication to large-diameter
polished sapphire wafers and patterned sapphire substrates (PSS),
enabling Rubicon to supply custom sapphire products with superior
quality and precision. Rubicon is ISO 9001 certified and ITAR registered.
Further information is available at http://www.rubicontechnology.com.
Forward-Looking Statements
Certain of the statements in this release, particularly those preceded
by, followed by or including the words “believes,” “expects,”
“anticipates,” “intends,” “should,” “estimates,” or similar expressions,
or those relating to or anticipating financial results for periods
beyond the end of the fourth quarter of 2014, constitute
“forward-looking statements” within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. For those statements, the Company
claims the protection of the safe harbor for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on our current expectations,
estimates and projections about our industry, management's beliefs and
certain assumptions made by us. These statements are subject to risks
and uncertainties that could cause actual results to differ materially
from those expressed in, or implied by, the statements. These risks and
uncertainties include market acceptance of LED lighting, our ability to
adapt to future changes in the LED industry, our successful development
and market acceptance of new products, changes in the average selling
prices of sapphire products, dependence on key customers, potential
disruptions in our supply of electricity, changes in our product mix,
our ability to protect our intellectual property rights, the competitive
environment, the availability and cost of raw materials, the cost of
compliance with environmental standards, the ability to make effective
acquisitions and successfully integrate newly acquired businesses into
existing operations and other risks and uncertainties described in the
Company's most recent Form 10-K and other filings with the Securities
and Exchange Commission. For these reasons, readers are cautioned not to
place undue reliance on the Company's forward-looking statements. Any
forward-looking statement that the Company makes speaks only as of the
date of such statement, and the Company undertakes no obligation to
update any forward-looking statements, whether as a result of new
information, future events or otherwise. Comparisons of results for
current and any prior periods are not intended to express any future
trends or indications of future performance, unless expressed as such,
and should only be viewed as historical data.
|
Rubicon Technology, Inc.
|
Condensed Consolidated Balance Sheets
|
(in thousands)
|
|
|
|
December 31,
|
|
December 31,
|
|
|
2014
|
|
2013
|
Assets
|
|
(unaudited)
|
|
(audited)
|
Cash and cash equivalents
|
|
$
|
24,353
|
|
$
|
21,071
|
Restricted cash
|
|
|
183
|
|
|
165
|
Short-term investments
|
|
|
20,562
|
|
|
13,567
|
Accounts receivable, net
|
|
|
8,323
|
|
|
3,571
|
Inventories
|
|
|
22,739
|
|
|
34,312
|
Other current assets
|
|
|
9,243
|
|
|
13,719
|
Total current assets
|
|
|
85,403
|
|
|
86,405
|
|
|
|
|
|
Property and equipment, net
|
|
|
107,676
|
|
|
115,220
|
Other assets
|
|
|
1,827
|
|
|
1,070
|
Total assets
|
|
$
|
194,906
|
|
$
|
202,695
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
3,754
|
|
$
|
4,465
|
Accrued and other current liabilities
|
|
|
1,999
|
|
|
2,172
|
Total current liabilities
|
|
|
5,753
|
|
|
6,637
|
|
|
|
|
|
Deferred tax liability
|
|
|
593
|
|
|
267
|
Total liabilities
|
|
|
6,346
|
|
|
6,904
|
|
|
|
|
|
Stockholders' equity
|
|
|
188,560
|
|
|
195,791
|
Total liabilities and stockholders’ equity
|
|
$
|
194,906
|
|
$
|
202,695
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rubicon Technology, Inc.
|
Condensed Consolidated Statements of Operations (unaudited)
|
(in thousands except share and per share amounts)
|
|
|
|
Three months ended December 31,
|
|
|
Twelve months ended December 31,
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
8,912
|
|
|
$
|
11,536
|
|
|
|
$
|
45,685
|
|
|
$
|
41,513
|
|
Cost of goods sold
|
|
|
14,371
|
|
|
|
17,347
|
|
|
|
|
75,372
|
|
|
|
63,434
|
|
Gross loss
|
|
|
(5,459
|
)
|
|
|
(5,811
|
)
|
|
|
|
(29,687
|
)
|
|
|
(21,921
|
)
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
|
2,329
|
|
|
|
2,087
|
|
|
|
|
9,863
|
|
|
|
8,629
|
|
Sales and marketing expenses
|
|
|
332
|
|
|
|
388
|
|
|
|
|
1,468
|
|
|
|
1,521
|
|
Research and development expenses
|
|
|
448
|
|
|
|
745
|
|
|
|
|
1,861
|
|
|
|
2,263
|
|
Loss (gain) on disposal of assets
|
|
|
69
|
|
|
|
(6
|
)
|
|
|
|
734
|
|
|
|
550
|
|
Total operating expenses
|
|
|
3,178
|
|
|
|
3,214
|
|
|
|
|
13,926
|
|
|
|
12,963
|
|
Loss from operations
|
|
|
(8,637
|
)
|
|
|
(9,025
|
)
|
|
|
|
(43,613
|
)
|
|
|
(34,884
|
)
|
|
|
|
|
|
|
|
|
|
|
Other (expense) income:
|
|
|
|
|
|
|
|
|
|
Interest (expense) income and other, net
|
|
|
(395
|
)
|
|
|
(81
|
)
|
|
|
|
(302
|
)
|
|
|
(627
|
)
|
Loss before income taxes
|
|
|
(9,032
|
)
|
|
|
(9,106
|
)
|
|
|
|
(43,915
|
)
|
|
|
(35,511
|
)
|
Income tax (expense) benefit
|
|
|
(370
|
)
|
|
|
(6,135
|
)
|
|
|
|
(78
|
)
|
|
|
5,160
|
|
Net loss
|
|
$
|
(9,402
|
)
|
|
$
|
(15,241
|
)
|
|
|
$
|
(43,993
|
)
|
|
$
|
(30,351
|
)
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.36
|
)
|
|
$
|
(0.67
|
)
|
|
|
$
|
(1.70
|
)
|
|
$
|
(1.35
|
)
|
Diluted
|
|
$
|
(0.36
|
)
|
|
$
|
(0.67
|
)
|
|
|
$
|
(1.70
|
)
|
|
$
|
(1.35
|
)
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding used in computing net
loss per common share:
|
|
|
26,127,026
|
|
|
|
22,599,258
|
|
|
|
|
25,815,405
|
|
|
|
22,572,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rubicon Technology, Inc.
|
Condensed Consolidated Statements of Cash Flows (unaudited)
|
(in thousands)
|
|
|
|
Three months ended December 31,
|
|
Twelve months ended December 31,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(9,402
|
)
|
|
$
|
(15,241
|
)
|
|
$
|
(43,993
|
)
|
|
$
|
(30,351
|
)
|
Adjustments to reconcile net loss to net cash (used in) provided by
operating activities
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
3,317
|
|
|
|
3,305
|
|
|
|
13,638
|
|
|
|
12,660
|
|
Other
|
|
|
137
|
|
|
|
473
|
|
|
|
1,883
|
|
|
|
2,259
|
|
Deferred taxes
|
|
|
435
|
|
|
|
6,136
|
|
|
|
72
|
|
|
|
(5,166
|
)
|
Changes in operating assets and liabilities
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
(2,501
|
)
|
|
|
872
|
|
|
|
(4,752
|
)
|
|
|
9,098
|
|
Inventories
|
|
|
(18
|
)
|
|
|
5,173
|
|
|
|
11,312
|
|
|
|
12,979
|
|
Other assets
|
|
|
488
|
|
|
|
(577
|
)
|
|
|
3,409
|
|
|
|
4,547
|
|
Accounts payable
|
|
|
(236
|
)
|
|
|
(408
|
)
|
|
|
(637
|
)
|
|
|
(4,472
|
)
|
Accrued expenses and other current liabilities
|
|
|
48
|
|
|
|
572
|
|
|
|
(154
|
)
|
|
|
(1,142
|
)
|
Net cash (used in) provided by operating activities
|
|
|
(7,732
|
)
|
|
|
305
|
|
|
|
(19,222
|
)
|
|
|
412
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
Purchases of property and equipment, net of proceeds from disposals
of assets
|
|
|
(715
|
)
|
|
|
(1,403
|
)
|
|
|
(6,827
|
)
|
|
|
(8,580
|
)
|
Purchases of investments, net of proceeds from sales of investments
|
|
|
7,254
|
|
|
|
1,043
|
|
|
|
(6,105
|
)
|
|
|
9,350
|
|
Net cash provided by (used in) investing activities
|
|
|
6,539
|
|
|
|
(360
|
)
|
|
|
(12,932
|
)
|
|
|
770
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock, net of issuance costs
|
|
|
-
|
|
|
|
-
|
|
|
|
34,957
|
|
|
|
-
|
|
Other financing activities
|
|
|
2
|
|
|
|
(114
|
)
|
|
|
184
|
|
|
|
32
|
|
Net cash provided by (used in) financing activities
|
|
|
2
|
|
|
|
(114
|
)
|
|
|
35,141
|
|
|
|
32
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign exchange rate changes on cash and cash equivalents
|
|
|
400
|
|
|
|
(338
|
)
|
|
|
295
|
|
|
|
284
|
|
|
|
|
|
|
|
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
(791
|
)
|
|
|
(507
|
)
|
|
|
3,282
|
|
|
|
1,498
|
|
Cash and cash equivalents, beginning of period
|
|
|
25,144
|
|
|
|
21,578
|
|
|
|
21,071
|
|
|
|
19,573
|
|
Cash and cash equivalents, end of period
|
|
$
|
24,353
|
|
|
$
|
21,071
|
|
|
$
|
24,353
|
|
|
$
|
21,071
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rubicon Technology, Inc.
|
Revenue by Product Group
|
(in thousands)
|
|
|
|
|
|
Three months ended December 31,
|
|
Three months ended September 30,
|
|
Three months ended December 31,
|
|
|
2014
|
|
2014
|
|
2013
|
Core
|
|
|
|
|
|
|
2 Inch
|
|
$
|
3,192
|
|
$
|
856
|
|
$
|
8,160
|
4 Inch
|
|
|
1,554
|
|
|
3,327
|
|
|
1,056
|
6 Inch
|
|
|
5
|
|
|
-
|
|
|
-
|
Polished
|
|
|
1,470
|
|
|
1,828
|
|
|
591
|
PSS
|
|
|
511
|
|
|
257
|
|
|
171
|
R&D
|
|
|
137
|
|
|
156
|
|
|
367
|
Optical and other
|
|
|
2,043
|
|
|
1,612
|
|
|
1,191
|
Total
|
|
$
|
8,912
|
|
$
|
8,036
|
|
$
|
11,536
|
Copyright Business Wire 2015