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CVD Equipment (CVV) Q2 Earnings Increase Y/Y, Gross Margin Down
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CVD Equipment Corporation (CVV - Free Report) reported a loss per share of 11 cents in the second quarter of 2024, narrower than the year-ago quarter’s loss of 16 cents.
Revenues in Detail
CVD Equipment registered revenues of $6.3 million in the second quarter, up 25.2% year over year.
The increase in year-over-year revenues was primarily attributable to higher revenues from the CVD Equipment segment and an increase in revenues from the SDC segment. This was offset by a decrease in the CVD Materials segment.
Revenues from one aerospace customer for the three months ended Jun 30, 2024, represented 35.2% of the company’s total revenues and 54.3% of CVD Equipment segment revenues.
CVD Equipment’s backlog at Jun 30, 2024, was $24 million compared with $18.4 million at the end of Dec 31, 2023.
Segment Details
CVD Equipment derives revenues from three segments — CVD Equipment, SDC and CVD Materials.
For the quarter under review, CVD Equipment revenues were $4.1 million, up 31% from the year-ago quarter. This primarily resulted from increases in revenues from aerospace contracts in progress, partially offset by lower revenues for PVT150 systems and spare parts.
SDC revenues during the second quarter were $2.3 million, up 28.9% year over year. The uptick resulted from higher demand for SDC’s gas and chemical delivery system products compared with the prior period.
Revenues in the CVD Materials segment totaled $0.1 million, down 83.9% year over year, primarily due to the disposition of Tantaline in May 2023 and the wind-down of MesoScribe’s operations.
CVD Equipment Corporation Price, Consensus and EPS Surprise
In the quarter under review, CVD Equipment’s gross profit increased 15.9% to $1.6 million. However, the gross margin contracted 202 basis points to 25.4%.
Adjusted Operating Expenses Analysis
Selling expenses decreased 0.5% year over year to $0.4 million. Research and development expenses went up 18.9% year over year to $0.7 million, while general and administrative expenses went up 4.1% year over year to $1.4 million. Total adjusted operating expenses of $2.5 million increased 6.8% year over year.
Profitability
Adjusted operating loss totaled $0.89 million compared with the year-ago period’s $0.96 million.
In the second quarter, CVD Equipment’s net loss was $0.8 million compared with $1.1 million reported in the year-ago quarter.
Liquidity & Debt Management
CVD Equipment exited second-quarter 2024 with cash and cash equivalents of $10 million compared with $11.9 million at the first-quarter end. Total debt at the end of the second quarter was $0.31 million compared with $0.33 million at the first-quarter end.
Cumulative net cash used in operating activities at the end of the second quarter was $2 million compared with $3.3 million a year ago.
Our Take
CVD Equipment exited the second quarter of 2024 with encouraging top-line and bottom-line results. Robust revenues from the majority of the segments and higher backlog were also impressive. The company recently shipped a PVT 200 system, which was part of the first-quarter strategic order for SiC 200mm crystal boule growth. This looks promising for the stock.
However, lower revenues from the CVD Materials segment were discouraging. During the reported quarter, the gross margins contracted, which did not bode well.
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CVD Equipment (CVV) Q2 Earnings Increase Y/Y, Gross Margin Down
CVD Equipment Corporation (CVV - Free Report) reported a loss per share of 11 cents in the second quarter of 2024, narrower than the year-ago quarter’s loss of 16 cents.
Revenues in Detail
CVD Equipment registered revenues of $6.3 million in the second quarter, up 25.2% year over year.
The increase in year-over-year revenues was primarily attributable to higher revenues from the CVD Equipment segment and an increase in revenues from the SDC segment. This was offset by a decrease in the CVD Materials segment.
Revenues from one aerospace customer for the three months ended Jun 30, 2024, represented 35.2% of the company’s total revenues and 54.3% of CVD Equipment segment revenues.
CVD Equipment’s backlog at Jun 30, 2024, was $24 million compared with $18.4 million at the end of Dec 31, 2023.
Segment Details
CVD Equipment derives revenues from three segments — CVD Equipment, SDC and CVD Materials.
For the quarter under review, CVD Equipment revenues were $4.1 million, up 31% from the year-ago quarter. This primarily resulted from increases in revenues from aerospace contracts in progress, partially offset by lower revenues for PVT150 systems and spare parts.
SDC revenues during the second quarter were $2.3 million, up 28.9% year over year. The uptick resulted from higher demand for SDC’s gas and chemical delivery system products compared with the prior period.
Revenues in the CVD Materials segment totaled $0.1 million, down 83.9% year over year, primarily due to the disposition of Tantaline in May 2023 and the wind-down of MesoScribe’s operations.
CVD Equipment Corporation Price, Consensus and EPS Surprise
CVD Equipment Corporation price-consensus-eps-surprise-chart | CVD Equipment Corporation Quote
CVD Equipment Gross Margin
In the quarter under review, CVD Equipment’s gross profit increased 15.9% to $1.6 million. However, the gross margin contracted 202 basis points to 25.4%.
Adjusted Operating Expenses Analysis
Selling expenses decreased 0.5% year over year to $0.4 million. Research and development expenses went up 18.9% year over year to $0.7 million, while general and administrative expenses went up 4.1% year over year to $1.4 million. Total adjusted operating expenses of $2.5 million increased 6.8% year over year.
Profitability
Adjusted operating loss totaled $0.89 million compared with the year-ago period’s $0.96 million.
In the second quarter, CVD Equipment’s net loss was $0.8 million compared with $1.1 million reported in the year-ago quarter.
Liquidity & Debt Management
CVD Equipment exited second-quarter 2024 with cash and cash equivalents of $10 million compared with $11.9 million at the first-quarter end. Total debt at the end of the second quarter was $0.31 million compared with $0.33 million at the first-quarter end.
Cumulative net cash used in operating activities at the end of the second quarter was $2 million compared with $3.3 million a year ago.
Our Take
CVD Equipment exited the second quarter of 2024 with encouraging top-line and bottom-line results. Robust revenues from the majority of the segments and higher backlog were also impressive. The company recently shipped a PVT 200 system, which was part of the first-quarter strategic order for SiC 200mm crystal boule growth. This looks promising for the stock.
However, lower revenues from the CVD Materials segment were discouraging. During the reported quarter, the gross margins contracted, which did not bode well.