Photronics, Inc.

Good day and thank you for standing by. Welcome to the Photronics Q2 fiscal year 2022 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. As a reminder, this conference is being recorded Wednesday, May 25th, 2022. I would now like to turn the conference over to John Jordan, Executive Vice President and CFO. You may begin.

Thank you, Tanya. Good morning, everyone. Welcome to our review of Photonics Fiscal 2022 second quarter results. Joining me this morning are Frank Lee, our recently appointed chief executive officer, Chris Progler, our chief technology officer, and Eric Rivera, our corporate controller and chief accounting officer. The press release we issued earlier this morning, along with the presentation material which accompanies our remarks, are available on the investor relations section of our webpage. Comments made by any participants on today's call may include forward-looking statements that include such words as anticipate, believe, estimate, expect, forecast, or in our view. These forward-looking statements are based upon a number of risks, uncertainties, and other factors that are difficult to predict. Actual results may differ materially. from those expressed or implied, and we assume no obligation to update any forward-looking information. At this time, I will turn the call over to Frank. Thank you, John, and good morning, everyone.

I would like to begin this morning by stating how honored I am to be with you today as the new CEO of Photonis. Since joining the company in 2006, I have helped create and deal our operation and strategy in Asia, including the formation of two joint venture with Dynapon Printing Company and also the recent geographic expansion of our operations into China. Turning to the financial results, we once again deliver a record revenue in the second quarter, improving 8% sequentially our strong end market demand, the further price realization across IC segment, and also the continuous production ramping up of our Charmin and Hefei operations. In addition to the top line growth, we expand our growth and operation margins Growth margin was 36 percent and operation margin 25 percent. The net result was EPS of 49 cents. Cash generation was also strong as we ended the year with $247 million in net cash, which positioned us to continue investing in profitable growth opportunity. As CEO, I'm fully committed to continue our organic growth strategy, the revenue growth and margin expansion. And also, we'll keep exploring additional growth initiatives. For revenue growth, the growth is achieved by winning more shares in the growing market right now. We have been working closely with our customers to meet their needs in technology and capacity roadmap. We are building partnerships with several key customers, and we also sign many long-term purchase agreements, so-called LTPA, with our key customers. This kind of approach serves us very well. to make a critical investment, and it helps us to quickly get return on our investment. Our recent IC and FPD operation into China are very good example of this approach. As the market leader, Fortranis has become a trust partner and key supplier of our customer in both IC and FPD. In addition to revenue growth, our profitability has been improving continuously. This is achieved by the varied execution of three major key items. The product optimization, the effective cost management, and operation efficiency enhancement. On top of these actions, we have implemented some pricing-adjust strategies based on current market supply-demand imbalance situation. My third commitment is to explore new strategies to further our growth initiatives. I've been very involved in this process since June 2020. We have a very good relationship with our customers, vendors, and value partners throughout Asia. With the emerging trend of global supply chain restructuring, include IC manufacturing localization, such as Made in USA, Petronas will solidify our activities and relationship in other geographics. I'm very certain that with our strong existing global footprint and a successful experience in Asia, we will be the far ahead winner in our business. We have performed very well. through the first half of 2022. And we are on track to have the best year in the history of the company. I'm very proud of our team. And together, we will continue to outperform beyond 2022. Thank you very much. And this time, I turn the call to John.