Aetrium Inc. (ATRM, Financial) filed Quarterly Report for the period ended 2009-03-31.
Aetrium Inc. designs manufactures and markets a variety of electromechanical equipment used in the handling and testing ofmicroelectronic components including integrated circuits and other forms of electronic components. The company's primary focus is on high volume electronic component types and on the latest package designs. Aetrium's products are purchased primarily by semiconductor manufacturers and their assembly and test subcontractors and are used in the test assembly and packaging portion of semiconductor manufacturing. Aetrium Inc. has a market cap of $14.4 million; its shares were traded at around $1.35 with and P/S ratio of 0.9.
Net Sales. Total net sales for the three months ended March 31, 2009 were $1.8 million compared with $5.6 million for the same period in 2008, a 69% decrease. Net sales decreased across all our product lines as general weakness in the semiconductor equipment industry in the first half of 2008 evolved into a severe downturn as worldwide economic conditions deteriorated through the end of the year and into 2009. Sales of test handlers were $1.2 million in the first three months of 2009 compared with $4.1 million for the same period in 2008, a decrease of 71%. Sales of reliability test equipment were $0.3 million compared with $0.5 million in the same period in 2008, a decrease of 44%. Sales of change kits and spare parts were $0.3 million in the first three months of 2009 compared with $1.1 million for the same period in 2008, a decrease of 71%.
Selling, General and Administrative. Selling, general and administrative, or SG&A, expenses consist primarily of employee compensation and related costs, independent representative commissions, travel, warranty and no-charge equipment improvement costs. SG&A expenses were $1.2 million for the three months ended March 31, 2009 compared with $1.7 million for the same period in 2008, a decrease of 29%. Compensation costs decreased $0.3 million in 2009 due to a workforce reduction implemented in December 2008, wage reductions for all employees implemented in January 2009 and the elimination of all profit-related incentives. Travel expenses and warranty/no-charge equipment improvement costs each decreased $0.1 million in 2009 due primarily to reduced sales and service activities.
Research and Development. Research and development expenses were $0.5 million for the three months ended March 31, 2009 compared with $0.8 million for the same period in 2008, a decrease of 39%. Compensation costs decreased $0.1 million in 2009 due to a workforce reduction implemented in December 2008, wage reductions for all employees implemented in January 2009 and the elimination of all profit-related incentives. Contract services decreased $0.2 million as such costs were reduced in response to lower sales levels. Research and development expenses represented 27.1% of total net sales for the three month period ended March 31, 2009 compared with 13.8% of total net sales for the comparable period in 2008. New product development is an essential part of our strategy to gain market share. Over time, we expect to invest approximately 12% to 15% of our revenues in research and development although we may exceed this range in periods of reduced revenues as was the case in the first three months of 2009.
Cash and cash equivalents decreased by approximately $0.5 million in the three months ended March 31, 2009. We used $0.5 million in cash to fund operating activities during this period. The major components of cash flows from operating activities were our net loss of $0.7 million, a $0.4 million increase in deferred income taxes, a $0.3 million decrease in accounts payable, and a $0.1 million decrease in accrued severance costs, partially offset by $0.1 million in non-cash depreciation and share-based compensation expense, a $0.3 million decrease in accounts receivable, and a $0.6 million decrease in inventories. Inventories and accounts payable decreased primarily due to significantly reduced inventory purchases in the first quarter of 2009 compared with the fourth quarter of 2008 in response to lower sales levels. The decrease in accrued severance costs reflects the payment of benefits associated with a workforce reduction we implemented in December 2008. Accounts receivable decreased primarily due to a significant decrease in net sales in the first quarter of 2009 compared with the fourth quarter of 2008. Net cash provided by investing activities in the three months ended March 31, 2009 was not significant. Net cash used in financing activities in the three months ended March 31, 2009 was not significant.
Cash and cash equivalents increased by approximately $0.8 million in the three months ended March 31, 2008. We generated $0.7 million in cash from operating activities during this period. The major components of cash flows from operating activities were net income of $0.3 million, $0.1 million in non-cash depreciation and share-based compensation expense, a $0.2 million decrease in deferred income taxes, and a $0.9 million decrease in accounts receivable, partially offset by a $0.4 million increase in inventories, a $0.2 million decrease in deferred revenue and a $0.1 million decrease in accrued warranty and no-charge equipment improvements. Accounts receivable decreased primarily due to a significant decrease in net sales in the first quarter of 2008 compared with the fourth quarter of 2007. Inventories increased primarily due to lower net sales than anticipated. Deferred revenue decreased as revenue recognition criteria were satisfied for items that had been deferred at December 31, 2007. Accrued warranty and no-charge equipment improvements decreased due to lower net sales and the shipment of certain items accrued in prior periods. Net cash provided by investing and financing activities in the three months ended March 31, 2008 was not significant.
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Aetrium Inc. designs manufactures and markets a variety of electromechanical equipment used in the handling and testing ofmicroelectronic components including integrated circuits and other forms of electronic components. The company's primary focus is on high volume electronic component types and on the latest package designs. Aetrium's products are purchased primarily by semiconductor manufacturers and their assembly and test subcontractors and are used in the test assembly and packaging portion of semiconductor manufacturing. Aetrium Inc. has a market cap of $14.4 million; its shares were traded at around $1.35 with and P/S ratio of 0.9.
Highlight of Business Operations:
As expected, general economic weakness and the semiconductor equipment industry slowdown continued into fiscal year 2009 and Aetrium s operating results have been affected accordingly. In the first quarter of 2009 our net sales were $1.8 million, compared with $2.9 million in the fourth quarter of 2008 and $5.6 million in the first quarter of 2008. We expect general economic and Aetrium business conditions to be challenging through the remainder of fiscal year 2009. Any prolonged continuation or worsening of the industry slowdown will likely adversely impact our longer term operating results as well.Net Sales. Total net sales for the three months ended March 31, 2009 were $1.8 million compared with $5.6 million for the same period in 2008, a 69% decrease. Net sales decreased across all our product lines as general weakness in the semiconductor equipment industry in the first half of 2008 evolved into a severe downturn as worldwide economic conditions deteriorated through the end of the year and into 2009. Sales of test handlers were $1.2 million in the first three months of 2009 compared with $4.1 million for the same period in 2008, a decrease of 71%. Sales of reliability test equipment were $0.3 million compared with $0.5 million in the same period in 2008, a decrease of 44%. Sales of change kits and spare parts were $0.3 million in the first three months of 2009 compared with $1.1 million for the same period in 2008, a decrease of 71%.
Selling, General and Administrative. Selling, general and administrative, or SG&A, expenses consist primarily of employee compensation and related costs, independent representative commissions, travel, warranty and no-charge equipment improvement costs. SG&A expenses were $1.2 million for the three months ended March 31, 2009 compared with $1.7 million for the same period in 2008, a decrease of 29%. Compensation costs decreased $0.3 million in 2009 due to a workforce reduction implemented in December 2008, wage reductions for all employees implemented in January 2009 and the elimination of all profit-related incentives. Travel expenses and warranty/no-charge equipment improvement costs each decreased $0.1 million in 2009 due primarily to reduced sales and service activities.
Research and Development. Research and development expenses were $0.5 million for the three months ended March 31, 2009 compared with $0.8 million for the same period in 2008, a decrease of 39%. Compensation costs decreased $0.1 million in 2009 due to a workforce reduction implemented in December 2008, wage reductions for all employees implemented in January 2009 and the elimination of all profit-related incentives. Contract services decreased $0.2 million as such costs were reduced in response to lower sales levels. Research and development expenses represented 27.1% of total net sales for the three month period ended March 31, 2009 compared with 13.8% of total net sales for the comparable period in 2008. New product development is an essential part of our strategy to gain market share. Over time, we expect to invest approximately 12% to 15% of our revenues in research and development although we may exceed this range in periods of reduced revenues as was the case in the first three months of 2009.
Cash and cash equivalents decreased by approximately $0.5 million in the three months ended March 31, 2009. We used $0.5 million in cash to fund operating activities during this period. The major components of cash flows from operating activities were our net loss of $0.7 million, a $0.4 million increase in deferred income taxes, a $0.3 million decrease in accounts payable, and a $0.1 million decrease in accrued severance costs, partially offset by $0.1 million in non-cash depreciation and share-based compensation expense, a $0.3 million decrease in accounts receivable, and a $0.6 million decrease in inventories. Inventories and accounts payable decreased primarily due to significantly reduced inventory purchases in the first quarter of 2009 compared with the fourth quarter of 2008 in response to lower sales levels. The decrease in accrued severance costs reflects the payment of benefits associated with a workforce reduction we implemented in December 2008. Accounts receivable decreased primarily due to a significant decrease in net sales in the first quarter of 2009 compared with the fourth quarter of 2008. Net cash provided by investing activities in the three months ended March 31, 2009 was not significant. Net cash used in financing activities in the three months ended March 31, 2009 was not significant.
Cash and cash equivalents increased by approximately $0.8 million in the three months ended March 31, 2008. We generated $0.7 million in cash from operating activities during this period. The major components of cash flows from operating activities were net income of $0.3 million, $0.1 million in non-cash depreciation and share-based compensation expense, a $0.2 million decrease in deferred income taxes, and a $0.9 million decrease in accounts receivable, partially offset by a $0.4 million increase in inventories, a $0.2 million decrease in deferred revenue and a $0.1 million decrease in accrued warranty and no-charge equipment improvements. Accounts receivable decreased primarily due to a significant decrease in net sales in the first quarter of 2008 compared with the fourth quarter of 2007. Inventories increased primarily due to lower net sales than anticipated. Deferred revenue decreased as revenue recognition criteria were satisfied for items that had been deferred at December 31, 2007. Accrued warranty and no-charge equipment improvements decreased due to lower net sales and the shipment of certain items accrued in prior periods. Net cash provided by investing and financing activities in the three months ended March 31, 2008 was not significant.
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