Entegris, Inc.
ENTEGRIS INC (Form: 8-K, Received: 10/26/2017 06:20:48)


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
________________________________________
FORM 8-K
________________________________________ 
 
  CURRENT REPORT
PURSUANT TO SECTIONS 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) October 26, 2017
 
 _______________________________________
  Entegris, Inc.
(Exact name of registrant as specified in its charter)
 _______________________________________
Delaware
(State or Other Jurisdiction of Incorporation or Organization)
 
 
 
 
001-32598
 
41-1941551
(Commission
File Number)
 
(I.R.S. Employer
Identification No.)
 
 
 
129 Concord Road, Billerica, MA
 
01821
(Address of principal executive offices)
 
(Zip Code)
(978) 436-6500
(Registrant’s telephone number, including area code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
  _______________________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 





Item 2.02.      Results of Operations and Financial Condition.
On October 26, 2017, Entegris, Inc. issued a press release to announce results for the third quarter of 2017, ended September 30, 2017, and will hold a conference call to discuss such results. A copy of this press release and the supplemental slides to which management will refer during the conference call are attached hereto as Exhibit 99.1 and Exhibit 99.2, respectively, and are incorporated herein by reference.
In accordance with General Instructions B.2 of Form 8-K, the information in this Item 2.02 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing. The information set forth herein will not be deemed an admission as to the materiality of any information required to be disclosed solely to satisfy the requirements of Regulation FD.
Item 9.01.      Financial Statements and Exhibits.
(d)  Exhibits
Exhibit
No.
 
Description
99.1
 
Press Release, dated October 26, 2017
99.2
 
Third Quarter 2017 Earnings Release Presentation Slides, dated October 26, 2017
 






SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ENTEGRIS, INC.


Dated: October 26, 2017            
By : /s/ Gregory B. Graves             
Name: Gregory B. Graves
Title: Executive Vice President and Chief Financial Officer







EXHIBIT INDEX
     
 




ENTEGRISLOGOA12.JPG
 
 
PRESS RELEASE

Contact:
Steven Cantor
VP of Corporate Relations
T + 978 436 6500
irelations@entegris.com




Exhibit 99.1
FOR RELEASE AT 6AM ET

ENTEGRIS REPORTS STRONG THIRD-QUARTER RESULTS

Record third-quarter revenue of $345.6 million grew 16 percent from prior year
GAAP earnings per diluted share of $0.28 and non-GAAP earnings per diluted share of $0.40 grew 87 percent and 67 percent, respectively, from prior year
Year-to-date revenue of $992.0 million increased 14 percent
Year-to-date GAAP earnings per diluted share of $0.79 and non-GAAP earnings per diluted share of $1.02 grew 58 percent and 48 percent respectively

BILLERICA, Mass., October 26, 2017 - Entegris , Inc. (NasdaqGS: ENTG), a leader in specialty chemicals and advanced materials solutions for the microelectronics industry, today reported its financial results for the Company’s third quarter ended September 30, 2017 .
Third-quarter sales were $345.6 million , an increase of 16.5% from the same quarter last year and a 5.0% increase sequentially. Third-quarter net income was $40.9 million , or $0.28 per diluted share, which included amortization of intangible assets of $11.1 million , as well as asset impairment charges of $10.0 million and severance expense of $2.1 million primarily related to the realignment of the Advanced Materials Handling business. Non-GAAP net income was $57.0 million , or $0.40 per diluted share.
For the first nine months of fiscal 2017, sales of $992.0 million increased 14.4% from the same period a year ago. Net income for the first nine months of 2017 was $113.4 million , or $0.79 per share, which included amortization of intangible assets of $33.0 million , as well as asset impairment charges and severance expense of $15.9 million. Non-GAAP net income for the first nine months of 2017 was $146.6 million , or $1.02 per diluted share, which increased from $98.6 million , or $0.69 per diluted share, for the same period a year ago.
Bertrand Loy, president and chief executive officer, said: "Our performance remained very strong in the third quarter and we are on track to exceed many of the objectives we set for ourselves for 2017 in terms of revenue growth and bottom line expansion. These results are a validation of the strategies and investments we have made to build a unique portfolio of specialty materials, filtration, and advanced materials handling technologies. These capabilities are becoming even more critical to solving complex process challenges facing the semiconductor industry as it creates devices to power new applications driven by artificial intelligence and the Internet of Things."
Mr. Loy added: "We generated record adjusted EBITDA of $96 million , or 28% of revenue. This strong cash generation is enabling us to invest in our growth, pay down our debt, make modest share repurchases and initiate a quarterly dividend, while maintaining flexibility for future acquisitions."









_________________________________________________________________________
ENTEGRIS, INC.

129 Concord Road, Building 2

T   + 1 978 436 6500
entegris.com

Billerica, MA 01821 USA
F   + 1 978 436 6745



Quarterly Financial Results Summary
(in thousands, except per share data)
GAAP Results
Q3-2017
Q3-2016
Q2-2017
Net sales
$345,591
$296,692
$329,002
Operating income
$60,655
$34,672
$59,090
Operating margin
17.6
%
11.7
%
18.0
%
Net income
$40,902
$21,947
$39,991
Diluted earnings per share (EPS)
$0.28
$0.15
$0.28
Non-GAAP Results
Non-GAAP adjusted operating income
$81,077
$53,877
$73,826
Adjusted operating margin
23.5
%
18.2
%
22.4
%
Non-GAAP net income
$56,989
$34,647
$48,906
Non-GAAP EPS
$0.40
$0.24
$0.34
Fourth-Quarter Outlook
For the fourth quarter ending December 31, 2017, the Company expects sales of $335 million to $345 million, net income of $43 million to $50 million, and net income per diluted share between $0.30 and $0.35. On a non-GAAP basis, EPS is expected to range from $0.35 to $0.40 per diluted share, which reflects net income on a non-GAAP basis in the range of $50 million to $57 million, which is adjusted for expected amortization expense of approximately $11 million or $0.05 per share.
Segment Results
The Company reports its results in the following segments:
Specialty Chemicals and Engineered Materials (SCEM): SCEM provides high-performance and high-purity process chemistries, gases and materials, as well as safe and efficient delivery systems to support semiconductor and other advanced manufacturing processes.
Microcontamination Control (MC): MC solutions purify critical liquid chemistries and gases used in semiconductor manufacturing processes and other high-technology industries.
Advanced Materials Handling (AMH): AMH develops solutions to monitor, protect, transport, and deliver critical liquid chemistries and substrates for a broad set of applications in the semiconductor industry and other high-technology industries.
Third-Quarter Results Conference Call Details
Entegris will hold a conference call to discuss its results for the third quarter on Thursday, October 26, 2017, at 9:00 a.m. Eastern Time. Participants should dial 1-866-548-4713 or 1-323-794-2093, referencing confirmation code 1147643. Participants are asked to dial in 5 to 10 minutes prior to the start of the call. To access a telephonic replay of the call, please  Click Here and reference confirmation code 1147643. The replay will be available starting at 12:30 p.m. ET on Thursday, October 26 until Saturday, December 9. A live and on-demand webcast of the call can also be accessed from the investor relations section of Entegris’ website at www.entegris.com .

Management’s slide presentation concerning the results for the third quarter, which may be referred to during the call, will be posted on the investor relations section of www.entegris.com  Thursday morning.

Entegris, Inc. | page 2 of 12


ABOUT ENTEGRIS
Entegris is a leader in specialty chemicals and advanced materials solutions for the microelectronics industry and other high-tech industries. Entegris is ISO 9001 certified and has manufacturing, customer service and/or research facilities in the United States, China, France, Germany, Israel, Japan, Malaysia, Singapore, South Korea and Taiwan. Additional information can be found at www.entegris.com .
Non-GAAP Information
The Company’s condensed consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (GAAP). Adjusted EBITDA, Adjusted Gross Profit, Adjusted Segment Profit, and Adjusted Operating Income together with related measures thereof, and non-GAAP EPS, are considered “Non-GAAP financial measures” under the rules and regulations of the Securities and Exchange Commission. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision-making, as a means to evaluate period-to-period comparisons, as well as comparisons to our competitors' operating results. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of our recurring business operating results, such as amortization, depreciation and discrete cash charges that are infrequent in nature. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing and understanding our results and performance and when planning, forecasting, and analyzing future periods. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze our business. The reconciliations of GAAP Net Income to Adjusted Operating Income and Adjusted EBITDA, GAAP Gross Profit to Adjusted Gross Profit, GAAP Segment Profit to Adjusted Operating Income, and GAAP to Non-GAAP Earnings per Share are included elsewhere in this release.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “forecast,” “project,” “should,” “may,” “will,” “would” or the negative thereof and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include statements related to future period guidance; future sales, net income, net income per diluted share, non-GAAP EPS, non-GAAP net income, expenses and other financial metrics; our performance relative to our markets; market and technology trends; the development of new products and the success of their introductions; Company's capital allocation strategy, which may be modified at any time for any reason, including share repurchases, dividends, debt repayments and potential acquisitions; our ability to execute on our strategies; and other matters. These statements involve risks and uncertainties, and actual results may differ. These risks and uncertainties include, but are not limited to, weakening of global and/or regional economic conditions, generally or specifically in the semiconductor industry, which could decrease the demand for our products and solutions; our ability to meet rapid demand shifts; our ability to continue technological innovation and introduce new products to meet our customers' rapidly changing requirements; our concentrated customer base; our ability to identify, effect and integrate acquisitions, joint ventures or other transactions; our ability to protect and enforce intellectual property rights; operational, political and legal risks of our international operations; our dependence on sole source and limited source suppliers; the increasing complexity of certain manufacturing processes; raw material shortages and price increases; changes in government regulations of the countries in which we operate; fluctuation of currency exchange rates; fluctuations in the market price of Entegris’ stock; the level of, and obligations associated with, our indebtedness; and other risk factors and additional information described in our filings with the Securities and Exchange Commission, including under the heading “Risks Factors" in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2016, filed on February 17, 2017, and in our other periodic filings. The Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates.


Entegris, Inc. | page 3 of 12


Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
 
 
Three months ended
 
 
September 30, 2017
October 1, 2016
July 1, 2017
Net sales
$345,591
$296,692
$329,002
Cost of sales
190,184

173,712

178,699

 
Gross profit
155,407

122,980

150,303

Selling, general and administrative expenses
57,699

51,614

52,985

Engineering, research and development expenses
26,002

25,720

27,221

Amortization of intangible assets
11,051

10,974

11,007

 
Operating income
60,655

34,672

59,090

Interest expense, net
7,599

9,345

8,103

Other expense (income), net
2,906

(565
)
(46
)
 
Income before income tax expense
50,150

25,892

51,033

Income tax expense
9,248

3,945

11,042

 
Net income
$40,902
$21,947
$39,991
 
 
 
 
 
 
 
 
Basic net income per common share:
$0.29
$0.16
$0.28
Diluted net income per common share:
$0.28
$0.15
$0.28
 
 
 
 
Weighted average shares outstanding:
 
 
 
 
Basic
141,684

141,324

141,696

 
Diluted
143,594

142,473

143,508



Entegris, Inc. | page 4 of 12


Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
 
 
Nine months ended
 
 
September 30, 2017
October 1, 2016
Net sales
$991,970
$866,768
Cost of sales
546,664

489,877

 
Gross profit
445,306

376,891

Selling, general and administrative expenses
161,176

153,167

Engineering, research and development expenses
80,462

79,768

Amortization of intangible assets
33,003

33,325

 
Operating income
170,665

110,631

Interest expense, net
24,095

27,545

Other expense (income), net
3,762

(2,294
)
 
Income before income tax expense
142,808

85,380

Income tax expense
29,401

14,331

 
Net income
$113,407
$71,049
 
 
 
 
 
 
Basic net income per common share:
$0.80
$0.50
Diluted net income per common share:
$0.79
$0.50
 
 
 
 
Weighted average shares outstanding:
 
 
 
Basic
141,627

141,019

 
Diluted
143,472

141,856



Entegris, Inc. | page 5 of 12


Entegris, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)

 
September 30, 2017
December 31, 2016
ASSETS
 
 
Cash and cash equivalents
$435,197
$406,389
Accounts receivable, net
183,417

165,675

Inventories
193,302

183,529

Deferred tax charges and refundable income taxes
15,720

20,140

Other current assets
20,865

24,398

      Total current assets
848,501

800,131

 
 
 
Property, plant and equipment, net
346,660

321,562

 
 
 
Goodwill
355,855

345,269

Intangible assets
190,754

217,548

Deferred tax assets
9,247

8,022

Other assets
6,732

7,000

      Total assets
$1,757,749
$1,699,532
 
 
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
 
Long-term debt, current maturities
$100,000
$100,000
Accounts payable
60,328

61,617

Accrued liabilities
95,161

83,530

Income tax payable
14,390

16,424

      Total current liabilities
269,879

261,571

 
 
 
Long-term debt, excluding current maturities
411,465

484,677

Other liabilities
58,040

54,066

Shareholders’ equity
1,018,365

899,218

      Total liabilities and shareholders’ equity
$1,757,749
$1,699,532


Entegris, Inc. | page 6 of 12


Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)

 
Three months ended
Nine months ended
 
September 30, 2017
October 1, 2016
September 30, 2017
October 1, 2016
Operating activities:
 
 
 
 
Net income
$40,902
$21,947
$113,407
$71,049
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
Depreciation
14,785

13,795

43,173

41,320

Amortization
11,051

10,974

33,003

33,325

Stock-based compensation expense
3,548

3,697

11,457

10,063

Provision for deferred income taxes
(2,953
)
597

254

(334
)
Other
13,898

10,463

24,028

19,667

Changes in operating assets and liabilities:
 
 
 
 
Trade accounts and notes receivable
(12,313
)
13,847

(15,345
)
(22,252
)
Inventories
(1,047
)
(5,907
)
(14,884
)
(17,296
)
Accounts payable and accrued liabilities
20,911

12,962

7,598

26,517

Income taxes payable and refundable income taxes
(1,293
)
(11,771
)
1,664

(11,364
)
Other
1,552

1,334

3,277

(219
)
Net cash provided by operating activities
89,041

71,938

207,632

150,476

Investing activities:
 
 
 
 
Acquisition of business net of cash acquired


(20,000
)

Acquisition of property and equipment
(25,447
)
(13,124
)
(67,939
)
(45,268
)
Other
863

138

1,074

(1,520
)
Net cash used in investing activities
(24,584
)
(12,986
)
(86,865
)
(46,788
)
Financing activities:
 
 
 
 
Payments on long-term debt
(25,000
)
(25,000
)
(75,000
)
(50,000
)
Issuance of common stock
677

512

3,582

2,892

Taxes paid related to net share settlement of equity awards
(168
)
(1,113
)
(5,407
)
(3,316
)
Repurchase and retirement of common stock
(10,000
)

(18,000
)
(3,573
)
Other

402

(1,270
)
493

Net cash used in financing activities
(34,491
)
(25,199
)
(96,095
)
(53,504
)
Effect of exchange rate changes on cash
(404
)
4,281

4,136

11,768

Increase in cash and cash equivalents
29,562

38,034

28,808

61,952

Cash and cash equivalents at beginning of period
405,635

373,743

406,389

349,825

Cash and cash equivalents at end of period
$435,197
$411,777
$435,197
$411,777


Entegris, Inc. | page 7 of 12


Entegris, Inc. and Subsidiaries
Segment Information
(In thousands)
(Unaudited)

 
Three months ended
Nine months ended
Net sales
September 30, 2017
October 1, 2016
July 1, 2017
September 30, 2017
October 1, 2016
Specialty Chemicals and Engineered Materials
$124,522
$104,494
$121,174
$360,131
$317,383
Microcontamination Control
116,113

94,738

104,407

320,575

263,941

Advanced Materials Handling
104,956

97,460

103,421

311,264

285,444

     Total net sales
$345,591
$296,692
$329,002
$991,970
$866,768

 
Three months ended
Nine months ended
Segment profit
September 30, 2017
October 1, 2016
July 1, 2017
September 30, 2017
October 1, 2016
Specialty Chemicals and Engineered Materials
$34,647
$18,811
$34,174
$96,961
$70,141
Microcontamination Control
43,984

31,617

36,484

116,049

78,323

Advanced Materials Handling
16,882

15,378

19,573

54,731

56,808

Total segment profit
95,513

65,806

90,231

267,741

205,272

Amortization of intangibles
11,051

10,974

11,007

33,003

33,325

Unallocated expenses
23,807

20,160

20,134

64,073

61,316

    Total operating income
$60,655
$34,672
$59,090
$170,665
$110,631


Entegris, Inc. | page 8 of 12


Entegris, Inc. and Subsidiaries
Reconciliation of GAAP Gross Profit to Adjusted Gross Profit
(In thousands)
(Unaudited)

 
Three months ended
Nine months ended
 
September 30, 2017
October 1, 2016
July 1, 2017
September 30, 2017
October 1, 2016
Net sales
$345,591
$296,692
$329,002
$991,970
$866,768
Gross profit-GAAP
$155,407
$122,980
$150,303
$445,306
$376,891
Adjustments to gross profit:
 
 
 
 
 
Severance related to organizational realignment
740
431
 
740
431
Impairment of equipment
3,364
5,826
1,966
5,330
5,826
Adjusted gross profit
$159,511
$129,237
$152,269
$451,376
$383,148
 
 
 
 
 
 
Gross margin - as a % of net sales
45.0
%
41.5
%
45.7
%
44.9
%
43.5
%
Adjusted gross margin - as a % of net sales
46.2
%
43.6
%
46.3
%
45.5
%
44.2
%


Entegris, Inc. | page 9 of 12


Entegris, Inc. and Subsidiaries
Reconciliation of GAAP Segment Profit to Adjusted Operating Income
(In thousands)
(Unaudited)

 
Three months ended
Nine months ended
Segment profit-GAAP
September 30, 2017
October 1, 2016
July 1, 2017
September 30, 2017
October 1, 2016
Specialty Chemicals and Engineered Materials
$34,647
$18,811
$34,174
$96,961
$70,141
Microcontamination Control
43,984
31,617
36,484
116,049
78,323
Advanced Materials Handling
16,882
15,378
19,573
54,731
56,808
Total segment profit
95,513
65,806
90,231
267,741
205,272
Amortization of intangible assets
11,051
10,974
11,007
33,003
33,325
Unallocated expenses
23,807
20,160
20,134
64,073
61,316
    Total operating income
$60,655
$34,672
$59,090
$170,665
$110,631
 
 
 
 
 
 
Segment profit margin-GAAP
 
 
 
 
 
Specialty Chemicals and Engineered Materials
27.8
%
18.0
%
28.2
%
26.9
%
22.1
%
Microcontamination Control
37.9
%
33.4
%
34.9
%
36.2
%
29.7
%
Advanced Materials Handling
16.1
%
15.8
%
18.9
%
17.6
%
19.9
%
 
Three months ended
Nine months ended
Adjusted segment profit
September 30, 2017
October 1, 2016
July 1, 2017
September 30, 2017
October 1, 2016
Specialty Chemicals and Engineered Materials 1  
$34,661
$19,510
$34,174
$96,975
$70,840
Microcontamination Control 2
44,180
32,354
37,927
117,688
79,060
Advanced Materials Handling 3
22,103
22,173
21,859
62,238
63,603
Total adjusted segment profit
100,944
74,037
93,960
276,901
213,503
Amortization of intangible assets 4





Unallocated expenses 5
19,867
20,160
20,134
60,133
61,316
    Total adjusted operating income
$81,077
$53,877
$73,826
$216,768
$152,187
 
 
 
 
 
 
Adjusted segment profit margin
 
 
 
 
 
Specialty Chemicals and Engineered Materials
27.8
%
18.7
%
28.2
%
26.9
%
22.3
%
Microcontamination Control
38.0
%
34.2
%
36.3
%
36.7
%
30.0
%
Advanced Materials Handling
21.1
%
22.8
%
21.1
%
20.0
%
22.3
%

1 Adjusted segment profit for Specialty Chemicals and Engineered Materials for the three months and nine months ended October 1, 2016 excludes charges for severance related to organizational realignment of $699. Adjusted segment profit for Specialty Chemicals and Engineered Materials for the three months and nine months ended September 30, 2017 excludes charges for severance related to organizational realignment of $14.
2 Adjusted segment profit for Microcontamination Control excludes charges for impairment of equipment and severance related to organizational realignment of $196, $737, and $1,443 for the three months ended September 30, 2017, October 1, 2016, and July 1, 2017, respectively. Adjusted segment profit for Microcontamination Control excludes impairment of equipment and charges for severance related to organizational realignment of $1,639 and $737 for the nine months ended September 30, 2017 and October 1, 2016, respectively.
3 Adjusted segment profit for Advanced Material Handling excludes charges for impairment of equipment and severance related to organizational realignment of $5,221, $6,795 and $2,286 for the three months ended September 30, 2017, October 1, 2016, and July 1, 2017, respectively. Adjusted segment profit for Advanced Material Handling excludes charges for impairment of equipment and severance related to organizational realignment of $7,507 and $6,795 for the nine months ended September 30, 2017 and October 1, 2016, respectively.
4 Adjusted amortization of intangible assets excludes amortization expense of $11,051, $10,974, and $11,007 for the three months ended September 30, 2017, October 1, 2016, and July 1, 2017, respectively, and $33,003 and $33,325 for the nine months ended September 30, 2017 and October 1, 2016, respectively.
5 Adjusted unallocated expenses excludes charges for impairment of intangibles and severance related to organizational realignment of $3,940 for the three months and nine months ended September 30, 2017.

Entegris, Inc. | page 10 of 12


Entegris, Inc. and Subsidiaries
Reconciliation of GAAP Net Income to Adjusted Operating Income and Adjusted EBITDA
(In thousands)
(Unaudited)

 
Three months ended
Nine months ended
 
September 30, 2017
October 1, 2016
July 1, 2017
September 30, 2017
October 1, 2016
Net sales
$345,591
$296,692
$329,002
$991,970
$866,768
Net income
$40,902
$21,947
$39,991
$113,407
$71,049
Adjustments to net income:
 
 
 
 
 
Income tax expense
9,248
3,945
11,042
29,401
14,331
Interest expense, net
7,599
9,345
8,103
24,095
27,545
Other expense (income), net
2,906
(565)
(46)
3,762
(2,294)
GAAP - Operating income
60,655
34,672
59,090
170,665
110,631
Severance related to organizational realignment
2,141
2,405
559
2,700
2,405
Impairment of equipment and intangibles 1  
7,230
5,826
3,170
10,400
5,826
Amortization of intangible assets
11,051
10,974
11,007
33,003
33,325
Adjusted operating income
81,077
53,877
73,826
216,768
152,187
Depreciation
14,785
13,795
14,411
43,173
41,320
Adjusted EBITDA
$95,862
$67,672
$88,237
$259,941
$193,507
 
 
 
 
 
 
Adjusted operating margin
23.5
%
18.2
%
22.4
%
21.9
%
17.6
%
Adjusted EBITDA - as a % of net sales
27.7
%
22.8
%
26.8
%
26.2
%
22.3
%

1 Includes product line impairment charges of $3,364, $5,826 and $1,966 classified as cost of sales for the three months ended September 30, 2017, October 1, 2016 and July 1, 2017, respectively. Includes product line impairment charges of $5,330 and $5,826 classified as cost of sales for the nine months ended September 30, 2017 and October 1, 2016, respectively.

Includes Jetalon intangible impairment charge of $3,866 classified as selling general and administrative expense for both the three and nine months ended September 30, 2017.

Includes product line impairment charge of $320 classified as selling general and administrative expense for both the three months ended July 1, 2017 and the nine months ended September 30, 2017.

Includes product line impairment charge of $884 classified as engineering, research and development expense for both the three months ended July 1, 2017 and the nine months ended September 30, 2017.

Entegris, Inc. | page 11 of 12


Entegris, Inc. and Subsidiaries
Reconciliation of GAAP Net Income to Non-GAAP Earnings per Share
(In thousands, except per share data)
(Unaudited)

 
Three months ended
Nine months ended
 
September 30, 2017
October 1, 2016
July 1, 2017
September 30, 2017
October 1, 2016
GAAP net income
$40,902
$21,947
$39,991
$113,407
$71,049
Adjustments to net income:
 
 
 
 
 
Severance related to organizational realignment
2,141
2,405
559
2,700
2,405
Impairment of equipment and intangibles 1  
10,030
5,826
3,170
13,200
5,826
Gain on sale of equity investment




(156)
Amortization of intangible assets
11,051
10,974
11,007
33,003
33,325
Tax effect of adjustments to net income and discrete items
(7,135)
(6,505)
(5,821)
(15,661)
(13,895)
Non-GAAP net income
$56,989
$34,647
$48,906
$146,649
$98,554
 
 
 
 
 
 
Diluted earnings per common share
$0.28
$0.15
$0.28
$0.79
$0.50
Effect of adjustments to net income
$0.11
$0.09
$0.06
$0.23
$0.19
Diluted non-GAAP earnings per common share
$0.40
$0.24
$0.34
$1.02
$0.69

1 Includes product line impairment charges of $3,364, $5,826 and $1,966 classified as cost of sales for the three months ended September 30, 2017, October 1, 2016 and July 1, 2017, respectively. Includes product line impairment charges of $5,330 and $5,826 classified as cost of sales for the nine months ended September 30, 2017 and October 1, 2016, respectively.

Includes Jetalon intangible impairment charge of $3,866 classified as selling general and administrative expense for both the three and nine months ended September 30, 2017.

Includes product line impairment charge of $320 classified as selling general and administrative expense for both the three months ended July 1, 2017 and the nine months ended September 30, 2017.

Includes product line impairment charge of $884 classified as engineering, research and development expense for both the three months ended July 1, 2017 and the nine months ended September 30, 2017.

Includes product line impairment charge of $2,800 classified as other expense for both the three and nine months ended September 30, 2017.


### END ###



Entegris, Inc. | page 12 of 12
OCTOBER 26, 2017 Earnings Summary Third Quarter 2017


 
2 SAFE HARBOR This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “forecast,” “project,” “should,” “may,” “will,” “would” or the negative thereof and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include statements related to future period guidance; future sales, net income, net income per diluted share, non-GAAP EPS, non-GAAP net income, expenses and other financial metrics; our performance relative to our markets; market and technology trends; the development of new products and the success of their introductions; Company's capital allocation strategy, which may be modified at any time for any reason, including share repurchases, dividends, debt repayments and potential acquisitions; our ability to execute on our strategies; and other matters. These statements involve risks and uncertainties, and actual results may differ. These risks and uncertainties include, but are not limited to, weakening of global and/or regional economic conditions, generally or specifically in the semiconductor industry, which could decrease the demand for our products and solutions; our ability to meet rapid demand shifts; our ability to continue technological innovation and introduce new products to meet our customers' rapidly changing requirements; our concentrated customer base; our ability to identify, effect and integrate acquisitions, joint ventures or other transactions; our ability to protect and enforce intellectual property rights; operational, political and legal risks of our international operations; our dependence on sole source and limited source suppliers; the increasing complexity of certain manufacturing processes; raw material shortages and price increases; changes in government regulations of the countries in which we operate; fluctuation of currency exchange rates; fluctuations in the market price of Entegris’ stock; the level of, and obligations associated with, our indebtedness; and other risk factors and additional information described in our filings with the Securities and Exchange Commission, including under the heading “Risks Factors" in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2016, filed on February 17, 2017, and in our other periodic filings. The Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. This presentation contains references to “Adjusted EBITDA,” “Adjusted EBITDA Margin,” “Adjusted Operating Income,” “Adjusted Operating Income Margin” and “Non-GAAP Earnings per Share” that are not presented in accordance GAAP. The non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures but should instead be read in conjunction with the GAAP financial measures. Further information with respect to and reconciliations of such measures to the most directly comparable GAAP financial measure can be found attached to this presentation.


 
3 3Q17 AND YEAR-TO-DATE HIGHLIGHTS ◦ 3Q17 sales grew 16% from a year ago and 5% sequentially, reflecting strong performance of both our new products and legacy offerings; ◦ Specialty Chemicals and Engineered Materials sales grew 19% from a year ago to a record level ◦ Microcontamination Control sales grew 23% from a year ago, achieving 6th consecutive record quarter ◦ Advanced Materials Handling sales grew 8% ◦ Achieved quarterly GAAP EPS of $0.28, and non-GAAP EPS of $0.40, which grew 87% and 67%, respectively, from the prior year; ◦ Generated record quarterly adjusted EBITDA of $96 million, or 28% of revenue; ◦ Grew sales year-to-date 14% to $992 million; ◦ Increased year-to-date GAAP EPS of $0.79 by 58% and non-GAAP EPS of $1.02 by 48% from same period in 2016; ◦ Took steps to further realign our AMH business and expand its future profitability; and ◦ Expanded our capital allocation strategy to include a quarterly dividend, while continuing to pay down our term loan and make modest share repurchases


 
$ in millions, except per share data 3Q17 3Q17 Guidance 2Q17 3Q16 3Q17 over 3Q16 3Q17 over 2Q17 Net Revenue $345.6 $325 to $340 $329.0 $296.7 16.5% 5.0% Gross Margin 45.0% 45.7% 41.5% Operating Expenses $94.8 $90 to $92 $91.2 $88.3 7.4% 3.9% Operating Income $60.7 $59.1 $34.7 74.9% 2.7% Operating Margin 17.6% 18.0% 11.7% Tax Rate 18.4% 21.6% 15.2% Net Income $40.9 $36 to $43 $40.0 $21.9 86.8% 2.3% EPS $0.28 $0.25 to $0.30 $0.28 $0.15 86.7% 0% 4 SUMMARY – CONSOLIDATED STATEMENT OF OPERATIONS (GAAP)


 
$ in millions, except per share data 3Q17 3Q17 Guidance 2Q17 3Q16 3Q17 over 3Q16 3Q17 over 2Q17 Net Revenue $345.6 $325 to $340 $329.0 $296.7 16.5% 5.0% Adjusted Gross Margin2 46.2% 46.3% 43.6% Non-GAAP Operating Expenses3 $78.4 $79 to $81 $78.4 $75.4 4.0% 0% Adjusted Operating Income $81.1 $73.8 $53.9 50.5% 9.9% Adjusted Operating Margin 23.5% 22.4% 18.2% Non-GAAP Tax Rate4 22.3% 25.6% 23.2% Non-GAAP Net Income5 $57.0 $43 to $50 $48.9 $34.6 64.7% 16.6% Non-GAAP EPS $0.40 $0.30 to $0.35 $0.34 $0.24 66.7% 17.6% 5 1. See GAAP to Non-GAAP reconciliation tables in the appendix of this presentation. 2. Adjusted gross margin excludes certain impairment of equipment and severance charges. 3. Non-GAAP Operating Expenses exclude amortization expense, severance charges and impairment of equipment and intangibles. 4. Non-GAAP Tax Rate reflects the tax effect of non-GAAP adjustments and discrete tax items to GAAP taxes. 5. Non-GAAP Net Income excludes amortization expense, severance charges and impairment of assets. SUMMARY – CONSOLIDATED STATEMENT OF OPERATIONS (NON-GAAP)1


 
$ in millions, except per share data Nine Months Ended September 30, 2017 Nine Months Ended October 1, 2016 Year-over-Year Net Revenue $992.0 $866.8 14.4% Gross Margin 44.9% 43.5% Operating Expenses $274.6 $266.3 3.1% Operating Income $170.7 $110.6 54.3% Operating Margin 17.2% 12.8% Tax Rate 20.6% 16.8% Net Income $113.4 $71.0 59.7% EPS $0.79 $0.50 58.0% 6 SUMMARY – CONSOLIDATED STATEMENT OF OPERATIONS (GAAP) – YEAR TO DATE


 
$ in millions, except per share data Nine Months Ended September 30, 2017 Nine Months Ended October 1, 2016 Year-over-Year Net Revenue $992.0 $866.8 14.4% Gross Margin 45.5% 44.2% Operating Expenses $234.6 $231.0 1.6% Operating Income $216.8 $152.2 42.4% Operating Margin 21.9% 17.6% Tax Rate 23.5% 22.3% Net Income $146.6 $98.6 48.7% EPS $1.02 $0.69 47.8% 7 SUMMARY – CONSOLIDATED STATEMENT OF OPERATIONS (NON-GAAP) – YEAR TO DATE


 
8 1. Represents diluted earnings per share. See Reconciliation of GAAP Net Income to Non-GAAP Earnings per Share in the appendix of this presentation. EARNINGS PER SHARE1 $0.15 $0.28 $0.24 $0.40 $0.00 $0.05 $0.10 $0.15 $0.20 $0.25 $0.30 $0.35 $0.40 $0.45 3Q16 3Q17 EPS: 3Q17 vs. 3Q16 GAAP Non-GAAP $0.63 $0.97 $0.90 $1.26 $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 3Q16 3Q17 EPS: Trailing 4 Quarters GAAP Non-GAAP


 
RESULTS BY SEGMENT1 9 1. Adjusted segment operating margin excludes amortization of intangibles and unallocated expenses. 2. Segment profit for SCEM for 3Q16 and 3Q17 includes a charge for severance of $699K and $14K, respectively. 3. Segment profit for MC for 3Q16 and Q317 includes a charge for severance of $737K and $196K, respectively. Segment profit for MC for 2Q17 includes charges for impairment of equipment and severance of $884K and $559K, respectively. 4. Segment profit for AMH for 3Q16 includes charges for impairment of equipment and severance totaling $6,795K. Segment profit for AMH for 2Q17 includes charges for impairment of equipment of $2,286K. Segment profit for AMH for 3Q17 includes charges for impairment of equipment and severance totaling $5,221K 0% 10% 20% 30% 40% $0 $20 $40 $60 $80 $100 $120 3Q16 4Q16 1Q17 2Q17 3Q17 Specialty Chemicals and Engineered Materials Segment2 Sales Adj. Op. margin 0% 10% 20% 30% 40% $0 $20 $40 $60 $80 $100 $120 3Q16 4Q16 1Q17 2Q17 3Q17 Microcontamination Control Segment3 Sales Adj. Op. margin 0% 10% 20% 30% 40% $0 $20 $40 $60 $80 $100 $120 3Q16 4Q16 1Q17 2Q17 3Q17 Advanced Materials Handling Segment4 Sales Adj. Op. margin $ in millions


 
REVENUE BY GEOGRAPHY: STRONG GROWTH IN ASIA AND EUROPE 10 N. America Asia Japan Europe YTD17 Revenue by Geography YTD Revenue = $992.0 million 11% 19% 2% 13% N. America Asia Japan Europe 0% 5% 10% 15% 20% 25% YTD17 vs. YTD16 Growth Rate $89.0M $571.0M $212.1M $119.9M


 
$ in millions 3Q17 2Q17 3Q16 $ Amount % Total $ Amount % Total $ Amount % Total Cash & Cash Equivalents $435.2 24.8% $405.6 23.5% $411.8 24.0% Accounts Receivable, net $183.4 10.4% $171.1 9.9% $167.6 9.8% Inventories $193.3 11.0% $194.2 11.2% $186.0 10.9% Net PP&E $346.7 19.7% $341.1 19.7% $315.5 18.4% Total Assets $1,757.7 $1,727.4 $1,713.6 Current Liabilities1 $269.9 15.4% $251.0 14.5% $237.7 13.9% Long-term debt, excluding current maturities $411.5 23.4% $435.9 25.2% $508.8 29.7% Total Liabilities $739.4 42.1% $745.1 43.1% $816.4 47.6% Total Shareholders’ Equity $1,018.4 57.9% $982.3 56.9% $897.2 52.4% AR - DSOs 48.4 47.5 51.5 Inventory Turns 3.9 3.7 3.8 11 1. Current Liabilities in 3Q17, 2Q17 and 3Q16 includes $100 million of current maturities of long term debt, respectively. SUMMARY – BALANCE SHEET ITEMS


 
12 1. See Reconciliation of GAAP Income to Adjusted Operating Income and Adjusted EBITDA in the appendix of this presentation. ADJUSTED EBITDA MARGIN1 $245 $33021.6% 25.4% 0 50 100 150 200 250 300 350 TTM -3Q16 TTM-3Q17 Adjusted EBITDA TTM Adj. EBITDA in $M Adj. EBITDA as % of Sales $68 $70 $76 $88 $96 22.8% 22.7% 23.9% 26.8% 27.7% 0 40 80 3Q16 4Q16 1Q17 2Q17 3Q17 Adjusted EBITDA and EBITDA Margin Adj. EBITDA in $M Adj. EBITDA as % of Sales


 
$ in millions 3Q17 2Q17 3Q16 Beginning Cash Balance $405.6 $391.2 $373.7 Cash from operating activities $89.0 $85.2 $71.9 Capital expenditures ($25.4) ($20.3) ($13.1) Acquisition of business - ($20.0) - Payments on long-term debt ($25.0) ($25.0) ($25.0) Repurchase and retirement of common stock ($10.0) ($4.0) - Other investing activities $0.9 - $0.1 Other financing activities $0.5 $0.2 ($0.2) Effect of exchange rates ($0.4) ($1.7) $4.3 Ending Cash Balance $435.2 $405.6 $411.8 Free Cash Flow1 $63.6 $64.9 $58.8 Adjusted EBITDA $95.9 $88.2 $67.7 CASH FLOWS 13 1. Free cash flow equals cash from operations less capital expenditures.


 
OUTLOOK 14 1. Non-GAAP operating expenses exclude amortization. In 4Q17, amortization is estimated to be approximately $11 million, or $0.05 per share. $ in millions, except per share data 4Q17 Guidance 3Q17 Actual 4Q16 Actual Net Revenue $335 to $345 $345.6 $308.5 Operating Expenses $90 to $92 $94.8 $86.9 Net Income $43 to $50 $40.9 $26.1 EPS $0.30 to $0.35 $0.28 $0.18 $ in millions, except per share data 4Q17 Guidance 3Q17 Actual 4Q16 Actual Net Revenue $335 to $345 $345.6 $308.5 Non-GAAP Operating Expenses1 $79 to $81 $78.4 $76.0 Non-GAAP Net Income $50 to $57 $57.0 $34.3 Non-GAAP EPS $0.35 to $0.40 $0.40 $0.24 Non-GAAP GAAP


 
Entegris®, the Entegris Rings Design™ and Pure Advantage™ are trademarks of Entegris, Inc. ©2016 Entegris, Inc. All rights reserved. 15


 
NON-GAAP RECONCILIATION TABLE RECONCILIATION OF GAAP GROSS PROFIT TO ADJUSTED GROSS PROFIT 16 Three months ended Nine months ended September 30, 2017 October 1, 2016 July 1, 2017 September 30, 2017 October 1, 2016 Net Sales $345,591 $296,692 $329,002 $991,970 $866,768 Gross profit-GAAP $155,407 $122,980 $150,303 $445,306 $376,891 Adjustments to gross profit: Severance related to organizational realignment 740 431 - 740 431 Impairment of equipment 3,364 5,826 1,966 5,330 5,826 Adjusted gross profit $159,511 129,237 $152,269 451,376 $383,148 Gross margin - as a % of net sales 45.0% 41.5% 45.7% 44.9% 43.5% Adjusted gross margin - as a % of net sales 46.2% 43.6% 46.3% 45.5% 44.2% $ in thousands


 
NON-GAAP RECONCILIATION TABLE RECONCILIATION OF GAAP SEGMENT PROFIT TO ADJUSTED OPERATING INCOME 17 Three months ended Nine months ended Segment profit-GAAP September 30, 2017 October 1, 2016 July 1, 2017 September 30, 2017 October 1, 2016 Specialty Chemicals and Engineered Materials $34,647 $18,811 $34,174 $96,961 $70,141 Microcontamination Control 43,984 31,617 36,484 116,049 78,323 Advanced Materials Handling 16,882 15,378 19,573 54,731 56,808 Total segment profit 95,513 65,806 90,231 267,741 205,272 Amortization of intangible assets 11,051 10,974 11,007 33,003 33,325 Unallocated expenses 23,807 20,160 20,134 64,073 61,316 Total operating income $60,655 $34,672 $59,090 $170,665 $110,631 $ in thousands Three months ended Nine months ended Adjusted segment profit September 30, 2017 October 1, 2016 July 1, 2017 September 30, 2017 October 1, 2016 Specialty Chemicals and Engineered Materials1 $34,661 $19,510 $34,174 $96,975 $70,840 Microcontamination Control2 44,180 32,354 37,927 117,688 79,060 Advanced Materials Handling3 22,103 22,173 21,859 62,238 63,603 Total segment profit 100,944 74,037 93,960 276,901 213,503 Amortization of intangible assets4 - - - - - Unallocated expenses5 19,867 20,160 20,134 60,133 61,316 Total adjusted operating income $81,077 $53,877 $73,826 $216,768 $152,187 1. Adjusted segment profit for SCEM for the three months and nine months ended October 1, 2016 excludes charges for severance related to organizational realignment of $699K. Adjusted segment profit for SCEM for the three months and nine months ended September 30, 2017 excludes charges for severance related to organizational realignment of $14K. 2. Adjusted segment profit for MC excludes charges for impairment of equipment and severance related to organizational realignment of $196K, $737K, and $1,443K for the three months ended September 30, 2017, October 1, 2016, and July 1, 2017, respectively. Adjusted segment profit for MC excludes impairment of equipment and charges for severance related to organizational realignment of $1,639K and $737K for the nine months ended September 30, 2017 and October 1, 2016, respectively. 3. Adjusted segment profit for AMH excludes charges for impairment of equipment and severance related to organizational realignment of $5,221K, $6,795K and $2,286K for the three months ended September 30, 2017, October 1, 2016, and July 1, 2017, respectively. Adjusted segment profit for AMH excludes charges for impairment of equipment and severance related to organizational realignment of $7,507 and $6,795 for the nine months ended September 30, 2017 and October 1, 2016, respectively. 4. Adjusted amortization of intangible assets excludes amortization expense of $11,051K, $10,974K, and $11,007K for the three months ended September 30, 2017, October 1, 2016, and July 1, 2017, respectively, and $33,003K and $33,325K for the nine months ended September 30, 2017 and October 1, 2016, respectively. 5. Adjusted unallocated expenses excludes charges for impairment of intangibles and severance related to organizational realignment of $3,940K for the three months and nine months ended September 30, 2017.


 
NON-GAAP RECONCILIATION TABLE RECONCILIATION OF GAAP TO ADJUSTED OPERATING INCOME AND ADJUSTED EBITDA 18 Three months ended Nine months ended September 30, 2017 October 1, 2016 July 1, 2017 September 30, 2017 October 1, 2016 Net sales $345,591 $296,692 $329,002 $991,970 $866,768 Net income $40,902 $21,947 $39,991 $113,407 $71,049 Adjustments to net income: Income tax expense 9,248 3,945 11,042 29,401 14,331 Interest expense, net 7,599 9,345 8,103 24,095 27,545 Other expense (income), net 2,906 (565) (46) 3,762 (2,294) GAAP - Operating income 60,655 34,672 59,090 170,665 110,631 Severance 2,141 2,405 559 2,700 2,405 Impairment of equipment and intangibles1 7,230 5,826 3,170 10,400 5,826 Amortization of intangible assets 11,051 10,974 11,007 33,003 33,325 Adjusted operating income 81,077 53,877 73,826 216,768 152,187 Depreciation 14,785 13,795 14,411 43,173 41,320 Adjusted EBITDA $95,862 $67,672 $88,237 $259,941 $193,507 Adjusted operating margin 23.5% 18.2% 22.4% 21.9% 17.6% Adjusted EBITDA - as a % of net sales 27.7% 22.8% 26.8% 26.2% 22.3% $ in thousands 1. Includes product line impairment charges of $3,364K, $5,826K and $1,966K classified as cost of sales for the three months ended September 30, 2017, October 1, 2016 and July 1, 2017, respectively. Includes product line impairment charges of $5,330K and $5,826K classified as cost of sales for the nine months ended September 30, 2017 and October 1, 2016, respectively. Includes Jetalon intangible impairment charge of $3,866K classified as selling general and administrative expense for both the three and nine months ended September 30, 2017. Includes product line impairment charge of $320K classified as selling general and administrative expense for both the three months ended July 1, 2017 and the nine months ended September 30, 2017. Includes product line impairment charge of $884K classified as engineering, research and development expense for both the three months ended July 1, 2017 and the nine months ended September 30, 2017.


 
NON-GAAP RECONCILIATION TABLE RECONCILIATION OF GAAP TO NON-GAAP EARNINGS PER SHARE 19 Three months ended Nine months ended September 30, 2017 October 1, 2016 July 1, 2017 September 30, 2017 October 1, 2016 GAAP net income $40,902 $21,947 $39,991 $113,407 $71,049 Adjustments to net income: Severance 2,141 2,405 559 2,700 2,405 Impairment of equipment and intangibles1 10,030 5,826 3,170 13,200 5,826 Gain on sale of equity investment - - - - (156) Amortization of intangible assets 11,051 10,974 11,007 33,003 33,325 Tax effect of adjustments to net income and discrete items (7,135) (6,505) (5,821) (15,661) (13,895) Non-GAAP net income $56,989 $34,647 $48,906 $146,649 $98,554 Diluted earnings per common share $0.28 $0.15 $0.28 $0.79 $0.50 Effect of adjustments to net income $0.11 $0.09 $0.06 $0.23 $0.19 Diluted non-GAAP earnings per common share $0.40 $0.24 $0.34 $1.02 $0.69 $ in thousands, except per share data 1. Includes product line impairment charges of $3,364K, $5,826K and $1,966K classified as cost of sales for the three months ended September 30, 2017, October 1, 2016 and July 1, 2017, respectively. Includes product line impairment charges of $5,330K and $5,826K classified as cost of sales for the nine months ended September 30, 2017 and October 1, 2016, respectively. Includes Jetalon intangible impairment charge of $3,866K classified as selling general and administrative expense for both the three and nine months ended September 30, 2017. Includes product line impairment charge of $320K classified as selling general and administrative expense for both the three months ended July 1, 2017 and the nine months ended September 30, 2017. Includes product line impairment charge of $884K classified as engineering, research and development expense for both the three months ended July 1, 2017 and the nine months ended September 30, 2017. Includes product line impairment charge of $2,800K classified as other expense for both the three and nine months ended September 30, 2017.


 
20 GAAP SEGMENT TREND DATA Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Sales SCEM 99,897$ 110,569$ 105,285$ 103,127$ 101,107$ 111,782$ 104,494$ 110,945$ 114,435$ 121,174$ 124,522$ MC 75,947 79,293 78,485 82,092 77,619 91,584 94,738 98,717 100,055 104,407 116,113 AMH 87,529 90,847 86,483 81,567 88,298 99,686 97,460 98,840 102,887 103,421 104,956 Total Sales 263,373$ 280,709$ 270,253$ 266,786$ 267,024$ 303,052$ 296,692$ 308,502$ 317,377$ 329,002$ 345,591$ Segment Profit SCEM 22,010$ 30,826$ 23,316$ 24,218$ 22,416$ 28,914$ 18,811$ 25,919$ 28,140$ 34,174$ 34,647$ MC 19,874 20,605 21,926 20,671 18,140 28,566 31,617 31,719 35,581 36,484 43,984 AMH 19,679 20,860 15,786 10,094 18,911 22,519 15,378 16,644 18,276 19,573 16,882 Total Segment Profit 61,563$ 72,291$ 61,028$ 54,983$ 59,467$ 79,999$ 65,806$ 74,282$ 81,997$ 90,231$ 95,513$ Segment Profit Margin SCEM 22.0% 27.9% 22.1% 23.5% 22.2% 25.9% 18.0% 23.4% 24.6% 28.2% 27.8% MC 26.2% 26.0% 27.9% 25.2% 23.4% 31.2% 33.4% 32.1% 35.6% 34.9% 37.9% AMH 22.5% 23.0% 18.3% 12.4% 21.4% 22.6% 15.8% 16.8% 17.8% 18.9% 16.1% $ in thousands


 
NON-GAAP SEGMENT TREND DATA 21 1. Adjusted segment profit for SCEM for Q316 excludes charges for severance of $699K. Adjusted segment profit for SCEM for Q317 excludes charges for severance of $14K. 2. Adjusted segment profit for MC for Q316 excludes charges for severance of $737K. Adjusted segment profit for MC for 2Q17 excludes charges for impairment of equipment and severance of $884K and $559K, respectively. Adjusted segment profit for MC for Q317 excludes charges for severance of $196K. 3. Adjusted segment profit for AMH for Q316 excludes charges for impairment of equipment and severance related to organizational realignment of $5,826K and $969K, respectively. Adjusted segment profit for AMH for 2Q17 excludes charges for impairment of equipment of $2,286K. Adjusted segment profit for AMH for Q317 excludes charges for impairment of equipment and severance related to organizational realignment of $3,364K and $1,857K, respectively. Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Sales SCEM 99,897$ 110,569$ 105,285$ 103,127$ 101,107$ 111,782$ 104,494$ 110,945$ 114,435$ 121,174$ 124,522$ MC 75,947 79,293 78,485 82,092 77,619 91,584 94,738 98,717 100,055 104,407 116,113 AMH 87,529 90,847 86,483 81,567 88,298 99,686 97,460 98,840 102,887 103,421 104,956 Total Sales 263,373$ 280,709$ 270,253$ 266,786$ 267,024$ 303,052$ 296,692$ 308,502$ 317,377$ 329,002$ 345,591$ Adjusted Segment Profit SCEM1 22,010$ 30,826$ 23,316$ 24,218$ 22,416$ 28,914$ 19,510$ 25,919$ 28,140$ 34,174$ 34,661$ MC2 19,874 20,605 21,926 20,671 18,140 28,566 32,354 31,719 35,581 37,927 44,180 AMH3 19,679 20,860 15,786 10,094 18,911 22,519 22,173 16,644 18,276 21,859 22,103 Total Adj. Segment Profit 61,563$ 72,291$ 61,028$ 54,983$ 59,467$ 79,999$ 74,037$ 74,282$ 81,997$ 93,960$ 100,944$ Adjusted Segment Profit Margin SCEM 22.0% 27.9% 22.1% 23.5% 22.2% 25.9% 18.7% 23.4% 24.6% 28.2% 27.8% MC 26.2% 26.0% 27.9% 25.2% 23.4% 31.2% 34.2% 32.1% 35.6% 36.3% 38.0% AMH 22.5% 23.0% 18.3% 12.4% 21.4% 22.6% 22.8% 16.8% 17.8% 21.1% 21.1% $ in thousands