Entegris Reports Record Results for Fourth Quarter Of 2019

Entegris, Inc. (NasdaqGS: ENTG), a leader in specialty chemicals and advanced materials solutions for the microelectronics industry, today reported its financial results for the Company’s fourth quarter ended December 31, 2019.

Fourth-quarter sales were $427.0 million, an increase of 6% from the same quarter last year. GAAP fourth-quarter net income was $57.4 million, or $0.42 per diluted share, which included $16.0 million of amortization of intangible assets, $3.4 million of integration costs, $1.0 million in deal costs mainly associated with the recent acquisitions and a $0.2 million charge for fair value write-up of acquired inventory sold. Non-GAAP net income was $74.6 million and non-GAAP net income per diluted share was $0.55.

Bertrand Loy, president and chief executive officer, said: “Our strong performance in the fourth quarter resulted in record sales, EBITDA and EPS. These results were driven by continued traction of our advanced solutions, particularly in the new technology nodes. Our achievement of record sales and EPS in 2019, in the face of a very challenging end market, showcased the strength of our team’s execution and our highly resilient, differentiated and unit-driven business model.”

Mr. Loy added: “I’m optimistic about improving industry conditions in 2020 and we expect our growth will again outpace the market. We continue to believe that Entegris has never been better positioned and more relevant for our customers to help them achieve the targeted levels of chip performance, yields and reliability. Our position is bolstered by our combination of technology leadership; global scale; and world class operational excellence.”

Quarterly Financial Results Summary
(in thousands, except percentages and per share data)

GAAP Results	Q4 2019		Q4 2018		Q3 2019
Net sales	$426,998		$401,642		$394,147
Operating income	$84,085		$71,308		$52,793
Operating margin	19.7%		17.8%		13.4%
Net income	$57,438		$80,784		$40,767
Diluted earnings per share (EPS)	$0.42		$0.57		$0.30
Non-GAAP Results
Non-GAAP adjusted operating income	$104,647		$93,485		$88,220
Non-GAAP adjusted operating margin	24.5%		23.3%		22.4%
Non-GAAP net income	$74,582		$66,300		$68,179
Non-GAAP EPS	$0.55		$0.47		$0.50

First-Quarter Outlook

For the first quarter ending March 28, 2020, the Company expects sales of $415 million to $430 million, net income of $56 million to $63 million and net income per diluted share between $0.41 and $0.46. On a non-GAAP basis, EPS is expected to range from $0.50 to $0.55 per diluted share, which reflects net income on a non-GAAP basis in the range of $68 million to $75 million.

Segment Results

The Company reports its results in the following segments:

Specialty Chemicals and Engineered Materials (SCEM): SCEM provides high-performance and high-purity process chemistries, gases and materials, as well as safe and efficient delivery systems to support semiconductor and other advanced manufacturing processes.

Microcontamination Control (MC): MC solutions purify critical liquid chemistries and gases used in semiconductor manufacturing processes and other high-technology industries.

Advanced Materials Handling (AMH): AMH develops solutions to monitor, protect, transport, and deliver critical liquid chemistries, wafers, and substrates for a broad set of applications in the semiconductor industry and other high-technology industries.

Change in Inter-Segment Reporting

In the first quarter of 2019, the Company changed its definition of segment profit to include inter-segment sales. The Company updated its recognition of inter-segment sales to recognize the revenue and profit associated with products and components produced in one segment and supplied to another, before being sold to the ultimate end customer. The Company accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, that is, at approximate market prices. Prior quarter information has been recast to reflect the change in the Company’s definition of segment profit.

Entegris’ 2020 Investor and Analyst Day

Entegris will be hosting an Investor and Analyst Day on May 11, 2020 in New York City. More information on this event will be made available in the near future. If you have any questions please reach out to Bill Seymour, V.P. Investor Relations.

Fourth-Quarter Results Conference Call Details

Entegris will hold a conference call to discuss its results for the fourth quarter on Tuesday, February 4, 2020, at 9:00 a.m. Eastern Time. Participants should dial 800-263-0877 or [phone], referencing confirmation code 2038571. Participants are asked to dial in 5 to 10 minutes prior to the start of the call. For a replay of the call, please Click Here using passcode 2038571. The replay will be available from February 4, 2020 to March 19, 2020.

The call can also be accessed live and on-demand from the Entegris website. Point your web browser to

http://investor.entegris.com/events.cfm and follow the link to the webcast. The on-demand playback will be available for six weeks after the conclusion of the teleconference.

Management’s slide presentation concerning the results for the third quarter, which may be referred to during the call, will be posted on the investor relations section of www.entegris.com Thursday morning before the call.

ABOUT ENTEGRIS

Entegris is a leader in specialty chemicals and advanced materials solutions for the microelectronics industry and other high-tech industries. Entegris is ISO 9001 certified and has manufacturing, customer service and/or research facilities in the United States, Canada, China, France, Germany, Israel, Japan, Malaysia, Singapore, South Korea and Taiwan. Additional information can be found at www.entegris.com.

Non-GAAP Information

The Company’s condensed consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (GAAP). Adjusted EBITDA, Adjusted Gross Profit, Adjusted Segment Profit, and Adjusted Operating Income, together with related measures thereof, and non-GAAP net income and non-GAAP EPS, are considered “Non-GAAP financial measures” under the rules and regulations of the Securities and Exchange Commission. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision-making, as a means to evaluate period-to-period comparisons, as well as comparisons to the Company’s competitors' operating results. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding the Company’s performance and liquidity by excluding certain items that may not be indicative of the Company’s recurring business operating results, such as amortization, depreciation and discrete cash charges that may vary significantly from period to period. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing and understanding the Company’s results and performance and when planning, forecasting, and analyzing future periods. The Company believes these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by the Company’s institutional investors and the analyst community to help them analyze the Company’s business. The reconciliations of GAAP Net Income to Adjusted Operating Income and Adjusted EBITDA, GAAP Net Income and Earnings per Share to Non-GAAP Net Income and Earnings per Share, GAAP Gross Profit to Adjusted Gross Profit and GAAP Segment Profit to Adjusted Operating Income are included elsewhere in this release.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “forecast,” “project,” “should,” “may,” “will,” “would” or the negative thereof and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include statements related to future period guidance; future sales, net income, net income per diluted share, non-GAAP EPS, non-GAAP net income, expenses and other financial metrics; the Company’s performance relative to its markets; the impact, financial or otherwise, of any organizational changes; market and technology trends; the development of new products and the success of their introductions; the Company's capital allocation strategy, which may be modified at any time for any reason, including share repurchases, dividends, debt repayments and potential acquisitions; the effect of the Tax Cuts and Jobs Act on the Company’s capital allocation strategy; the impact of the acquisitions the Company has made and commercial partnerships the Company has established; the Company’s ability to execute on its strategies; and other matters. These statements involve risks and uncertainties, and actual results may differ materially from those projected in the forward-looking statements. These risks and uncertainties include, but are not limited to, weakening of global and/or regional economic conditions, generally or specifically in the semiconductor industry, which could decrease the demand for the Company’s products and solutions; the Company’s ability to meet rapid demand shifts; the Company’s ability to continue technological innovation and introduce new products to meet customers' rapidly changing requirements; risks associated with the impact of public health epidemics, such as the coronavirus currently impacting China, on our employees, customers and suppliers; the Company’s concentrated customer base; the Company’s ability to identify, effect and integrate acquisitions, joint ventures or other transactions; the Company’s ability to effectively implement any organizational changes; the Company’s ability to protect and enforce intellectual property rights; operational, political and legal risks of the Company’s international operations; the Company’s dependence on sole source and limited source suppliers; the increasing complexity of certain manufacturing processes; raw material shortages, supply constraints and price increases; changes in government regulations of the countries in which the Company operates; fluctuation of currency exchange rates; fluctuations in the market price of the Company’s stock; the level of, and obligations associated with, the Company’s indebtedness; and other risk factors and additional information described in the Company’s filings with the Securities and Exchange Commission, including under the heading “Risks Factors" in Item 1A of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed on February 11, 2019, and in the Company’s other periodic filings. The Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates.

 

Entegris, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (In thousands, except per share data) (Unaudited)
		Three months ended
		December 31, 2019			December 31, 2018			September 28, 2019
Net sales		$	426,998		$	401,642		$	394,147
Cost of sales		229,362			221,902			223,797
	Gross profit	197,636			179,740			170,350
Selling, general and administrative expenses		67,171			60,707			71,232
Engineering, research and development expenses		30,352			30,675			31,173
Amortization of intangible assets		16,028			17,050			15,152
	Operating income	84,085			71,308			52,793
Interest expense, net		12,743			8,426			10,216
Other expense, net		248			3,176			934
	Income before income tax expense	71,094			59,706			41,643
Income tax expense (benefit)		13,656			(21,078		)	876
	Net income	$	57,438		$	80,784		$	40,767
Basic net income per common share:		$	0.43		$	0.58		$	0.30
Diluted net income per common share:		$	0.42		$	0.57		$	0.30
Weighted average shares outstanding:
	Basic	134,778			139,268			135,092
	Diluted	136,470			140,515			136,530

 

Entegris, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (In thousands, except per share data) (Unaudited)
		Twelve months ended
		December 31, 2019			December 31, 2018
Net sales		$	1,591,066		$	1,550,497
Cost of sales		879,413			830,666
	Gross profit	711,653			719,831
Selling, general and administrative expenses		284,807			246,534
Engineering, research and development expenses		121,140			118,456
Amortization of intangible assets		66,428			62,152
	Operating income	239,278			292,689
Interest expense, net		42,310			30,255
Other (income) expense, net		(121,081		)	8,002
	Income before income tax expense	318,049			254,432
Income tax expense		63,189			13,677
	Net income	$	254,860		$	240,755
Basic net income per common share:		$	1.89		$	1.71
Diluted net income per common share:		$	1.87		$	1.69
Weighted average shares outstanding:
	Basic	135,137			141,026
	Diluted	136,568			142,610

 

Entegris, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands) (Unaudited)
				December 31, 2019				December 31, 2018
ASSETS
Current assets:
Cash and cash equivalents				351,911				$	482,062
Trade accounts and notes receivable, net				234,409				222,055
Inventories, net				287,098				268,140
Deferred tax charges and refundable income taxes				24,552				17,393
Other current assets				34,427				39,688
Total current assets				932,397				1,029,338
Property, plant and equipment, net				479,544				419,529
Other assets:
Right-of-use assets				50,160				—
Goodwill				695,044				550,202
Intangible assets, net				333,952				295,687
Deferred tax assets and other noncurrent tax assets				11,245				10,162
Other				13,744				12,723
Total assets				$	2,516,086			$	2,317,641
LIABILITIES AND EQUITY
Current liabilities
Long-term debt, current maturities				4,000				4,000
Accounts payable				84,207				93,055
Accrued liabilities				150,118				141,020
Income tax payable				26,108				31,593
Total current liabilities				264,433				269,668
Long-term debt, excluding current maturities				932,484				934,863
Long-term lease liability				43,827				—
Other liabilities				109,453				101,085
Shareholders’ equity				1,165,889				1,012,025
Total liabilities and equity				$	2,516,086			$	2,317,641

 

Entegris, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (In thousands) (Unaudited)
	Three months ended						Twelve months ended
	December 31, 2019			December 31, 2018			December 31, 2019			December 31, 2018
Operating activities:
Net income	$	57,438		$	80,784		$	254,860		$	240,755
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	20,352			16,880			74,975			65,116
Amortization	16,028			17,050			66,428			62,152
Stock-based compensation expense	4,714			4,385			19,629			17,112
Provision for deferred income taxes	(11,885		)	(10,810		)	(14,008		)	(11,876		)
Loss on extinguishment of debt	—			2,319			—			2,429
Other	9,300			5,804			23,551			16,278
Changes in operating assets and liabilities, net of effects of acquisitions:
Trade accounts and notes receivable	27,241			(8,760		)	(3,164		)	(17,473		)
Inventories	(15,665		)	(9,312		)	(21,354		)	(38,100		)
Accounts payable and accrued liabilities	9,264			29,390			(22,647		)	19,950
Income taxes payable, refundable income taxes and noncurrent taxes payable	17,080			(21,188		)	(3,494		)	(30,381		)
Other	(5,223		)	(15,215		)	7,522			(13,386		)
Net cash provided by operating activities	128,644			91,327			382,298			312,576
Investing activities:
Acquisition of property and equipment	(25,932		)	(34,816		)	(112,355		)	(110,153		)
Acquisition of business, net of cash	(10,996		)	(426		)	(277,369		)	(380,694		)
Other	1,069			(111		)	3,884			4,903
Net cash used in investing activities	(35,859		)	(35,353		)	(385,840		)	(485,944		)
Financing activities:
Proceeds from long-term borrowings	—			400,000			—			402,000
Payments on long-term debt	(2,000		)	(108,850		)	(4,000		)	(135,850		)
Dividend payments	(10,787		)	(9,890		)	(40,566		)	(39,591		)
Payments for debt extinguishment costs	—			—			—			—
Issuance of common stock	2,940			2,548			7,291			5,577
Taxes paid related to net share settlement of equity awards	(145		)	(134		)	(8,722		)	(14,686		)
Repurchase and retirement of common stock	(15,000		)	(143,781		)	(80,321		)	(173,781		)
Other	—			(8,512		)	(502		)	(9,258		)
Net cash (used in) provided by financing activities	(24,992		)	131,381			(126,820		)	34,411
Effect of exchange rate changes on cash and cash equivalents	1,370			(186		)	211			(4,389		)
Increase (decrease) in cash and cash equivalents	69,163			187,169			(130,151		)	(143,346		)
Cash and cash equivalents at beginning of period	282,748			294,893			482,062			625,408
Cash and cash equivalents at end of period	$	351,911		$	482,062		$	351,911		$	482,062

 

Entegris, Inc. and Subsidiaries Segment Information (In thousands) (Unaudited)
Note: In the first quarter of 2019, the Company changed its definition of segment profit to include inter-segment sales. The Company updated its recognition of inter-segment sales to recognize the revenue and profit associated with products and components produced in one segment and supplied to another, before being sold to the ultimate end customer. The Company accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, that is, at approximate market prices. Inter-segment sales are presented as an elimination below. Prior quarter information has been recast to reflect the change in the Company’s definition of segment profit.
	Three months ended									Twelve months ended
Net sales	December 31, 2019			December 31, 2018			September 28, 2019			December 31, 2019			December 31, 2018
Specialty Chemicals and Engineered Materials	$	146,747		$	133,928		$	127,750		$	526,519		$	530,241
Microcontamination Control	169,794			158,500			155,979			633,664			553,838
Advanced Materials Handling	117,455			115,527			117,256			458,290			493,404
Inter-segment elimination	$	(6,998	)	$	(6,313	)	$	(6,838	)	$	(27,407	)	$	(26,986	)
Total net sales	$	426,998		$	401,642		$	394,147		$	1,591,066		$	1,550,497

	Three months ended									Twelve months ended
Segment profit	December 31, 2019			December 31, 2018			September 28, 2019			December 31, 2019			December 31, 2018
Specialty Chemicals and Engineered Materials	$	32,822		$	28,221		$	17,074		$	98,327		$	127,080
Microcontamination Control	57,157			46,879			46,792			194,398			166,852
Advanced Materials Handling	20,686			19,096			17,077			75,173			92,327
Total segment profit	110,665			94,196			80,943			367,898			386,259
Amortization of intangibles	16,028			17,050			15,152			66,428			62,152
Unallocated expenses	10,552			5,838			12,998			62,192			31,418
Total operating income	$	84,085		$	71,308		$	52,793		$	239,278		$	292,689

 

Entegris, Inc. and Subsidiaries Reconciliation of GAAP Gross Profit to Adjusted Gross Profit (In thousands) (Unaudited)
	Three months ended									Twelve months ended
	December 31, 2019			December 31, 2018			September 28, 2019			December 31, 2019			December 31, 2018
Net sales	$	426,998		$	401,642		$	394,147		$	1,591,066		$	1,550,497
Gross profit-GAAP	$	197,636		$	179,740		$	170,350		$	711,653		$	719,831
Adjustments to gross profit:
Severance related to organizational realignment	(12		)	460			990			1,336			460
Charge for fair value mark-up of acquired inventory sold	211			3,379			4,483			7,544			6,868
Adjusted gross profit	$197,835			$183,579			$175,823			$720,533			$727,159
Gross margin - as a % of net sales	46.3		%	44.8		%	43.2		%	44.7		%	46.4		%
Adjusted gross margin - as a % of net sales	46.3		%	45.7		%	44.6		%	45.3		%	46.9		%

 

Entegris, Inc. and Subsidiaries Reconciliation of GAAP Segment Profit to Adjusted Operating Income (In thousands) (Unaudited)
Note: In the first quarter of 2019, the Company changed its definition of segment profit to include inter-segment sales. The Company updated its recognition of inter-segment sales to recognize the revenue and profit associated with products and components produced in one segment and supplied to another, before being sold to the ultimate end customer. The Company accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, that is, at approximate market prices. Prior quarter information has been recast to reflect the change in the Company’s definition of segment profit.
	Three months ended									Twelve months ended
Segment profit-GAAP	December 31, 2019			December 31, 2018			September 28, 2019			December 31, 2019			December 31, 2018
Specialty Chemicals and Engineered Materials	$	32,822		$	28,221		$	17,074		$	98,327		$	127,080
Microcontamination Control	57,157			46,879			46,792			194,398			166,852
Advanced Materials Handling	20,686			19,096			17,077			75,173			92,327
Total segment profit	110,665			94,196			80,943			367,898			386,259
Amortization of intangible assets	16,028			17,050			15,152			66,428			62,152
Unallocated expenses	10,552			5,838			12,998			62,192			31,418
Total operating income	$	84,085		$	71,308		$	52,793		$	239,278		$	292,689

	Three months ended									Twelve months ended
Adjusted segment profit	December 31, 2019			December 31, 2018			September 28, 2019			December 31, 2019			December 31, 2018
Specialty Chemicals and Engineered Materials 1	$	32,530		$	28,221		$	23,700		$	105,995		$	127,080
Microcontamination Control 2	58,039			50,258			49,769			201,016			173,720
Advanced Materials Handling 3	20,307			19,556			20,212			78,507			93,253
Total adjusted segment profit	110,876			98,035			93,681			385,518			394,053
Adjusted amortization of intangible assets4	—			—			—			—			—
Adjusted unallocated expenses5	6,229			4,550			5,461			23,678			23,060
Total adjusted operating income	$	104,647		$	93,485		$	88,220		$	361,840		$	370,993

¹ Adjusted segment profit for Specialty Chemicals and Engineered Materials excludes charges for fair value mark-up of acquired inventory sold of ($476), $4,483 for the three months ended December 31, 2019 and September 28, 2019, respectively, and $4,822 for the twelve months ended December 31, 2019. Adjusted segment profit for Specialty Chemicals and Engineered Materials excludes severance and restructuring costs of $184 and $2,143 for the three months ended December 31, 2019 and September 28, 2019, respectively, and $2,846 for the twelve months ended December 31, 2019.

² Adjusted segment profit for Microcontamination Control excludes charges for fair value mark-up of acquired inventory sold of $687 and $3,379 for the three months ended December 31, 2019 and December 31, 2018, respectively, and $2,722 and $6,868 for the twelve months ended December 31, 2019 and December 31, 2018. Adjusted segment profit for Microcontamination Control excludes severance and restructuring costs of $195 and $2,977 for the three months ended December 31, 2019 and September 28, 2019, respectively, and $3,896 for the twelve months ended December 31, 2019.

³ Adjusted segment profit for Advanced Material Handling excludes severance and restructuring costs of ($379) and $3,135 for the three months ended December 31, 2019 and September 28, 2019, respectively, and $3,334 for the twelve months ended December 31, 2019. Adjusted segment profit for Advanced Materials Handling excludes charges for impairment of equipment and loss on sale of subsidiary of $460 and $466, respectively, for the twelve months ended December 31, 2018.

⁴ Adjusted amortization of intangible assets excludes amortization expense of $16,028, $17,050, and $15,152 for the three months ended December 31, 2019, December 31, 2018, and September 28, 2019, respectively, and $66,428 and $62,152 for the twelve months ended December 31, 2019 and December 31, 2018, respectively.

⁵ Adjusted unallocated expenses excludes deal and integration expenses of $4,323, $1,288, and $7,289 for the three months ended December 31, 2019, December 31, 2018 and September 28, 2019, respectively, and $36,096 and $8,358 for the twelve months ended December 31, 2019 and December 31, 2018, respectively. Adjusted unallocated expenses excludes severance and restructuring costs of $248 for the three months ended September 28, 2019 and $2,418 for the twelve months ended December 31, 2019.

 

Entegris, Inc. and Subsidiaries Reconciliation of GAAP Net Income to Adjusted Operating Income and Adjusted EBITDA (In thousands) (Unaudited)
	Three months ended									Twelve months ended
	December 31, 2019			December 31, 2018			September 28, 2019			December 31, 2019			December 31, 2018
Net sales	$	426,998		$	401,642		$	394,147		$	1,591,066		$	1,550,497
Net income	$	57,438		$	80,784		$	40,767		$	254,860		$	240,755
Adjustments to net income:
Income tax expense (benefit)	13,656			(21,078		)	876			63,189			13,677
Interest expense, net	12,743			8,426			10,216			42,310			30,255
Other expense (income), net	248			3,176			934			(121,081		)	8,002
GAAP - Operating income	84,085			71,308			52,793			239,278			292,689
Charge for fair value write-up of acquired inventory sold	211			3,379			4,483			7,544			6,868
Deal costs	973			—			4,891			26,164			5,121
Integration costs	3,350			1,288			2,398			9,932			3,237
Severance and restructuring costs	—			460			8,503			12,494			460
Loss on sale of subsidiary	—			—			—			—			466
Amortization of intangible assets	16,028			17,050			15,152			66,428			62,152
Adjusted operating income	104,647			93,485			88,220			361,840			370,993
Depreciation	20,352			16,880			19,306			74,975			65,116
Adjusted EBITDA	$	124,999		$	110,365		$	107,526		$	436,815		$	436,109
Net income - as a % of net sales	13.5		%	20.1		%	10.3		%	16.0		%	15.5		%
Adjusted operating margin	24.5		%	23.3		%	22.4		%	22.7		%	23.9		%
Adjusted EBITDA - as a % of net sales	29.3		%	27.5		%	27.3		%	27.5		%	28.1		%

 

Entegris, Inc. and Subsidiaries Reconciliation of GAAP Net Income and Earnings per Share to Non-GAAP Net Income and Earnings per Share (In thousands, except per share data) (Unaudited)
	Three months ended									Twelve months ended
	December 31, 2019			December 31, 2018			September 28, 2019			December 31, 2019			December 31, 2018
GAAP net income	$	57,438		$	80,784		$	40,767		$	254,860		$	240,755
Adjustments to net income:
Charge for fair value write-up of inventory acquired	211			3,379			4,483			7,544			6,868
Deal costs	973			—			4,891			26,575			5,121
Integration costs	3,350			1,288			2,398			9,932			3,237
Severance and restructuring costs	—			460			8,503			12,494			460
Loss on debt extinguishment and modification	1,980			2,319			—			1,980			2,319
Versum termination fee, net	—			—			—			(122,000		)	—
Loss on sale of subsidiary	—			—			—			—			466
Amortization of intangible assets	16,028			17,050			15,152			66,428			62,152
Tax effect of legal entity restructuring	—			(34,478		)	—			9,398			(34,478		)
Tax effect of adjustments to net income and discrete items1	(5,398		)	(5,603		)	(8,015		)	(3,124		)	(17,812		)
Tax effect of Tax Cuts and Jobs Act	—			1,101			—			—			683
Non-GAAP net income	$	74,582		$	66,300		$	68,179		$	264,087		$	269,771
Diluted earnings per common share	$	0.42		$	0.57		$	0.30		$	1.87		$	1.69
Effect of adjustments to net income	$	0.13		$	(0.10	)	$	0.20		$	0.07		$	0.20
Diluted non-GAAP earnings per common share	$	0.55		$	0.47		$	0.50		$	1.93		$	1.89

¹The tax effect of pre-tax adjustments to net income was calculated using the applicable marginal tax rate during the respective years.

 

Entegris, Inc. and Subsidiaries Reconciliation of GAAP Outlook to Non-GAAP Outlook (In millions, except per share data) (Unaudited)
	First-Quarter Outlook
Reconciliation GAAP net income to non-GAAP net income	March 28, 2020
GAAP net income	$56 - $63
Adjustments to net income:
Restructuring and integration costs	2
Amortization of intangible assets	13
Income tax effect	(3)
Non-GAAP net income	$68 - $75

	First-Quarter Outlook
Reconciliation GAAP diluted earnings per share to non-GAAP diluted earnings per share	March 28, 2020
Diluted earnings per common share	$0.41 - $0.46
Adjustments to diluted earnings per common share:
Restructuring and integration costs	0.01
Amortization of intangible assets	0.10
Income tax effect	(0.02)
Diluted non-GAAP earnings per common share	$0.50 to $0.55

 

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