10-year

10-Year Anniversary Promotion (20% off)

Join GuruFocus Premium Membership Now for Only $279/Year

Once a decade discount

Save up to $500 on Global Membership.

Don't Miss It !

Free 7-day Trial
All Articles and Columns »

Intevac Inc. Reports Operating Results (10-Q)

November 02, 2010 | About:
10qk

10qk

18 followers
Intevac Inc. (IVAC) filed Quarterly Report for the period ended 2010-10-02.

Intevac Inc. has a market cap of $220.2 million; its shares were traded at around $9.73 with a P/E ratio of 16.1 and P/S ratio of 2.9. IVAC is in the portfolios of Jean-Marie Eveillard of First Eagle Investment Management, LLC, John Buckingham of Al Frank Asset Management, Inc., Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Intevac Photonics revenue for the three and nine months ended October 2, 2010 increased over the same periods in the prior year which was the result of increased contract research and development work and increased product sales. Intevac Photonics revenues for the three months ended October 2, 2010 consisted of $5.2 million of research and development contract revenue and $3.5 million of product sales as compared to $4.5 million of research and development contract revenue and $2.3 million of product sales for the three months ended September 26, 2009. Intevac Photonics revenues for the nine months ended October 2, 2010 consisted of $14.1 million of research and development contract revenue and $10.8 million of product sales as compared to $11.5 million of research and development contract revenue and $7.8 million of product sales for the nine months ended September 26, 2009. The increase in product revenue resulted from higher sales of digital night-vision camera modules, systems and commercial products. The increase in contract research and development revenue was the result of a higher volume of contracts. Intevac expects that in the remainder of 2010, Intevac Photonics revenues will grow driven by government spending as well as growth in commercial products. Substantial growth in future Intevac Photonics revenues is dependent on proliferation of Intevacs technology into major military programs, continued defense spending, the ability to obtain export licenses for foreign customers, obtaining production subcontracts for these programs, and development and sale of commercial products.

Intevacs backlog of orders at October 2, 2010 was $64.9 million, compared to $73.8 million at December 31, 2009 and $52.2 million at September 26, 2009. The $64.9 million of backlog at October 2, 2010 consisted of $44.6 million of Equipment backlog and $20.3 million of Intevac Photonics backlog. The $73.8 million of backlog at December 31, 2009 consisted of $57.5 million of Equipment backlog and $16.3 million of Intevac Photonics backlog. Backlog at October 2, 2010 included six 200 Lean systems as compared to ten at December 31, 2009 and five at September 26, 2009.

International sales increased by 559.5% to $50.0 million for the three months ended October 2, 2010 from $7.6 million for the three months ended September 26, 2009 and by 559.4% to $127.9 million for the nine months ended October 2, 2010 from $19.4 million for the nine months ended September 26, 2009. International sales include products shipped to overseas operations of U.S. companies. The increase in international sales was primarily due to an increase in net revenues from disk sputtering systems, upgrades and spare parts. Substantially all of Intevacs international sales are to customers in Asia. International sales constituted 77.3% of net revenues for the three months ended October 2, 2010 and 39.6% of net revenues for the three months ended September 26, 2009. International sales constituted 76.9% of net revenues for the nine months ended October 2, 2010 and 44.3% of net revenues for the nine months ended September 26, 2009. The mix of domestic versus international sales will change from period to period depending on the location of Intevacs largest customers in each period.

Research and development spending increased in Equipment during the three months ended October 2, 2010 as compared to the three months ended September 26, 2009 primarily as the result of bonus and profit sharing accruals. Research and development spending decreased in Equipment during the nine months ended October 2, 2010 as compared to same period in the prior year as a result of reduced spending on semiconductor products, offset by increased investment in photovoltaic development. Research and development spending decreased in Intevac Photonics during the three and nine months ended October 2, 2010 as compared to the same periods in the prior year reflecting decreased spending for sensor yield improvements and digital night vision goggle development. Research and development expenses do not include costs of $3.3 million and $9.2 million for the three and nine months ended October 2, 2010 respectively, or $2.3 million and $6.4 million for the three and nine months ended September 26,

At October 2, 2010, Intevac had $129.2 million in cash, cash equivalents, and investments compared to $89.8 million at December 31, 2009. During the first nine months of 2010, cash and cash equivalents and investments increased by $39.4 million due primarily to net income and cash received from the sale of Intevac common stock to Intevacs employees through Intevacs employee benefit plans partially offset by purchases of fixed assets.

Accounts receivable totaled $33.6 million at October 2, 2010, compared to $44.8 million at December 31, 2009. The decrease of $11.2 million in the receivable balance was due to collection of customer deposit invoices which were outstanding at the end of the prior year and collection of systems receivables. Total net inventories increased to $26.6 million at October 2, 2010, compared to $19.1 million at December 31, 2009 primarily as a result of increased business levels. Accounts payable increased to $6.9 million at October 2, 2010 compared to $4.7 million at December 31, 2009 in line with increased manufacturing activities. Accrued payroll and related liabilities increased by $7.4 million during the nine months ended October 2, 2010 primarily related to bonus and profit sharing accruals. Other accrued liabilities decreased to $6.5 million at October 2, 2010 from $11.1 million at December 31, 2009, primarily due to revenue recognition in the first quarter of 2010 on a 200 Lean system shipment that had been deferred in the fourth quarter of 2009 until customer accep

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 4.0/5 (3 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK