EMCORE Reports Fiscal 2021 Fourth Quarter and Year End Results

ALHAMBRA, Calif., Nov. 30, 2021 (GLOBE NEWSWIRE) -- EMCORE Corporation (Nasdaq: EMKR), a leading provider of advanced mixed-signal products that serve the aerospace and defense, communications, and sensing markets, today announced results for the fiscal 2021 fourth quarter (4Q21) and full fiscal year (FY21) ended September 30, 2021. Management will host a conference call to discuss financial and business results tomorrow, Wednesday, December 1, 2021, at 8:00 AM Eastern Time (ET).

For 4Q21, consolidated revenue was $44.0 million, comprised of $11.7 million from the Aerospace and Defense (A&D) segment and $32.2 million from the Broadband segment. Net income was $5.1 million and $6.8 million on a GAAP and non-GAAP basis, respectively. Adjusted EBITDA was $7.8 million.

For FY21, consolidated revenue was $158.4 million, comprised of $50.8 million from the A&D segment and $107.6 million from the Broadband segment. Net income was $25.6 million and $24.0 million on a GAAP and non-GAAP basis, respectively. Adjusted EBITDA was $28.1 million.

Please refer to the schedules at the end of this press release for GAAP to non-GAAP reconciliations and other information related to non-GAAP financial measures.

“We delivered record-setting financial performance in the fiscal fourth quarter and for the full fiscal year 2021 despite headwinds from semiconductor shortages and supply chain problems. Strong demand from our Broadband customers and solid execution by the Emcore operating team combined to showcase the operating leverage in our business. For FY21, revenue was up 44%, gross margin expanded to 39%, and net income was 16% of revenue,” said Jeff Rittichier, Chief Executive Officer of EMCORE. “While the global pandemic impacted our A&D results in FY21, we made strong progress with the development and integration of new products for the navigation market and in strengthening our sales and marketing team. Now that our A&D customers are returning to more normal working environments, we expect significant growth from this segment in FY22.”

Consolidated Results                                                            

                                                                                                                                                                                                                                                                                                                                               
Aerospace and Defense Segment

For 4Q21, A&D’s sequential-quarter revenue decrease was due to lower sales of QMEMS and Defense Optoelectronics products, partially offset by higher FOG revenue. The lower A&D gross margin was primarily due to lower QMEMS margins. Research and development (R&D) expense increased primarily due to lower customer-funded R&D and increased project material costs. For FY21, A&D’s revenue decrease was due to lower Navigation revenue (QMEMS and FOG) and lower sales of Defense Optoelectronics products. The lower A&D gross margin was primarily due to the revenue decrease. The reduced R&D expense was primarily attributable to our FOG product line.

Broadband Segment

For 4Q21 and FY21, Broadband’s revenue increase was driven by record sales of Cable TV products, which also drove better gross margins. For 4Q21, the R&D expense decrease when compared to 3Q21 was primarily attributable to our Cable TV product line. For FY21, R&D expense was flat when compared to FY20.

Business Outlook

The Company expects revenue for the fiscal 2022 first quarter ending December 31, 2021 to be in the range of $41 million to $43 million.

Conference Call

The Company will discuss its financial results on December 1, 2021 at 8:00 a.m. ET (5:00 a.m. PT). The call will be available, live, to interested parties by dialing 877-614-0009. For international callers, please dial +1 786-460-7199. The conference passcode number is 5156156. The call will be webcast live via the Company's website at http://www.emcore.com. A webcast will be available for replay beginning Wednesday, December 1, 2021 following the conclusion of the call.

About EMCORE

EMCORE Corporation is a leading provider of advanced mixed-signal products that serve the aerospace and defense, communications, and sensing markets. Our best-in-class components and systems support a broad array of applications including navigation and inertial sensing, defense optoelectronics, broadband communications, optical sensing, and specialty chips for telecom and data center. We leverage industry-leading Quartz MEMS, Lithium Niobate and Indium Phosphide chip-level technology to deliver state-of-the-art component and system-level products across our end-market applications. EMCORE has vertically-integrated manufacturing capability at its wafer fabrication facility in Alhambra, CA, and Quartz MEMS manufacturing facility in Concord, CA. Our manufacturing facilities maintain ISO 9001 quality management certification, and we are AS9100 aerospace quality certified at our facility in Concord. For further information about EMCORE, please visit http://www.emcore.com.

Use of Non-GAAP Financial Measures

The Company conforms to U.S. Generally Accepted Accounting Principles (“GAAP”) in the preparation of its financial statements. We disclose supplemental non-GAAP earnings measures for gross profit margin, operating expenses, research and development expenses, operating profit, operating profit margin, net income, and earnings per share, as well as adjusted EBITDA.

Management believes these supplemental non-GAAP measures reflect the Company’s core ongoing operating performance and facilitates comparisons across reporting periods. The Company uses these measures when evaluating its financial results and for planning and forecasting of future periods. We believe that these supplemental non-GAAP measures are also useful to investors in assessing our operating performance. While we believe in the usefulness of these supplemental non-GAAP measures, there are limitations. Our non-GAAP measures may not be reported by other companies in our industry and/or may not be directly comparable to similarly titled measures of other companies due to potential differences in calculation. We compensate for these limitations by using these non-GAAP measures as a supplement to GAAP and by providing the reconciliations to the most comparable GAAP measure.

The schedules at the end of this press release reconcile the Company’s non-GAAP measures to the most directly comparable GAAP measure. The adjustments share one or more of the following characteristics: they are unusual and the Company does not expect them to recur in the ordinary course of its business, they do not involve the expenditure of cash, they are unrelated to the ongoing operation of the business in the ordinary course, or their magnitude and timing is largely outside of the Company’s control. For all reporting periods disclosed, the Company has applied consistent rationale, method, and adjustments in reconciling non-GAAP measures to the most directly comparable GAAP measure.

Non-GAAP measures are not in accordance with or an alternative to GAAP, nor are they meant to be considered in isolation or as a substitute for comparable GAAP measures. Our disclosures of these measures should be read only in conjunction with our financial statements prepared in accordance with GAAP. Non-GAAP measures should not be viewed as a substitute for the Company’s GAAP results.

Forward-Looking Statements

The information provided herein may include 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 (“Exchange Act”). These forward-looking statements are largely based on our current expectations and projections about future events and financial trends affecting the financial condition of our business. Such forward-looking statements include, in particular, projections about our future results, including our growth expectations in the A&D segment, statements about our plans, strategies, business prospects, changes and trends in our business and the markets in which we operate.

These forward-looking statements may be identified by the use of terms and phrases such as “anticipates”, “believes”, “can”, “could”, “estimates”, “expects”, “forecasts”, “intends”, “may”, “plans”, “projects”, “targets, “will”, and similar expressions or variations of these terms and similar phrases. Additionally, statements concerning future matters such as projected financial results, the development of new products, enhancements or technologies, sales levels, expense levels and other statements regarding matters that are not historical are forward-looking statements. We caution that these forward-looking statements relate to future events or our future financial performance and are subject to business, economic, and other risks and uncertainties, both known and unknown, that may cause actual results, levels of activity, performance or achievements of our business or our industry to be materially different from those expressed or implied by any forward-looking statements.

These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected, including without limitation, the following: (a) uncertainties regarding the effects of the COVID-19 pandemic, the length of time it will take for the COVID 19 pandemic to subside, and the impact of measures intended to reduce its spread on our business and operations, which is evolving and beyond our control; (b) the rapidly evolving markets for the Company's products and uncertainty regarding the development of these markets; (c) the Company's historical dependence on sales to a limited number of customers and fluctuations in the mix of products and customers in any period; (d) delays and other difficulties in commercializing new products; (e) the failure of new products: (i) to perform as expected without material defects, (ii) to be manufactured at acceptable volumes, yields, and cost, (iii) to be qualified and accepted by our customers, and (iv) to successfully compete with products offered by our competitors; (f) uncertainties concerning the availability and cost of commodity materials and specialized product components that we do not make internally; (g) actions by competitors; (h) risks and uncertainties related to applicable laws and regulations, including the impact of changes to applicable tax laws and tariff regulations; (i) acquisition-related risks, including that (i) the revenues and net operating results obtained from our acquisition of the Systron Donner Inertial ("SDI") business may not meet our expectations, (ii) there could be losses and liabilities arising from the acquisition of SDI that we will not be able to recover from any source, and (iii) we may not realize sufficient scale in our navigation systems product line from the SDI acquisition and will need to take additional steps, including making additional acquisitions, to achieve our growth objectives for this product line; (j) risks related to our ability to obtain capital; (k) risks related to the transition of certain of our manufacturing operations from our Beijing facility to a contract manufacturer’s facility; (l) risks and uncertainties related to manufacturing and production capacity and expansion plans related thereto; (m) risks related to the conversion of order backlog into product revenue; and (n) other risks and uncertainties discussed under Item 1A - Risk Factors in our Annual Report on Form 10-K for the fiscal year ended September 30, 2020, as updated by our subsequent periodic reports.

Forward-looking statements are based on certain assumptions and analysis made in light of our experience and perception of historical trends, current conditions and expected future developments as well as other factors that we believe are appropriate under the circumstances. While these statements represent our judgment on what the future may hold, and we believe these judgments are reasonable, these statements are not guarantees of any events or financial results. All forward-looking statements in this press release are made as of the date hereof, based on information available to us as of the date hereof, and subsequent facts or circumstances may contradict, obviate, undermine, or otherwise fail to support or substantiate such statements. We caution you not to rely on these statements without also considering the risks and uncertainties associated with these statements and our business that are addressed in our filings with the Securities and Exchange Commission (“SEC”) that are available on the SEC’s web site located at www.sec.gov, including the sections entitled “Risk Factors” in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q. Certain information included in this press release may supersede or supplement forward-looking statements in our other Exchange Act reports filed with the SEC. We do not intend to update any forward-looking statement to conform such statements to actual results or to changes in our expectations, except as required by applicable law or regulation.

EMCORE CORPORATION
Condensed Consolidated Statement of Operations and Comprehensive Income (Loss)
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(unaudited)

EMCORE CORPORATION
Condensed Consolidated Balance Sheets
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EMCORE CORPORATION
Reconciliations of GAAP to Non-GAAP Financial Measures

Contact:
EMCORE Corporation
Tom Minichiello
(626) 293-3400
investor@emcore.com

Released November 30, 2021