EX-99.7 8 ef20016543_ex99-7.htm EXHIBIT 99.7

Exhibit 99.7
December 13, 2023 Q4 2023 Financial Results Conference Call

Safe Harbor Statement This presentation and some of our comments during this presentation may contain projections or other forward-looking statements regarding future events, our future financial performance, and/or the future performance of the industry. These statements are predictions and contain risks and uncertainties. We refer you to the documents the Company files from time to time with the Securities and Exchange Commission. These documents contain and identify important factors that could cause the actual results for the Company to differ materially from those contained in our projections or forward-looking statements. These certain factors can be found at www.photronics.com/riskfactors. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee the accuracy of any forecasts or estimates, and we are not obligated to update any forward-looking statements if our expectations change.

2023 Summary Committed to driving long-term, profitable growth through strategic investments 6th consecutive year of record revenue Photomask industry flat in 2023 amidst general slowdown in semiconductor and display sector Margins improved on operating leverage, favorable pricing, and cost control As largest merchant photomask provider with expansive geographic footprint, Photronics uniquely positioned to benefit from expected long-term growth in photomask demand Capital allocation strategy and prudent balance sheet management support growth initiatives while increasing ROIC and resilience 1Net income attributable to Photronics, Inc. shareholders. 2Adjusted EPS is a non-GAAP measure. 1See reconciliation included in this presentation. $892.1M Revenue $125.5M Net Income1 $2.03 EPS1 $2.04 Adjusted2 EPS1 $302.2M OCF $499.3M Cash +8% Y/Y +6% Y/Y +5% Y/Y +23% Y/Y +10% Y/Y +56% Y/Y

Q4 2023 Summary Committed to driving long-term, profitable growth through strategic investments 1Net income attributable to Photronics, Inc. shareholders. 2Adjusted EPS is a non-GAAP measure. 1See reconciliation included in this presentation. $227.5M Revenue $44.6M Net Income1 $0.72 EPS1 $0.60 Adjusted2 EPS1 $106.6M OCF $499.3M Cash +8% Y/Y +1% Q/Q +20% Y/Y +65% Q/Q +20% Y/Y +64% Q/Q +18% Y/Y +18% Q/Q +35% Y/Y +24% Q/Q +56% Y/Y +11% Q/Q Revenue grew on strong demand across both IC and FPD as customers released new designs and ramped new fabs Adjusted EPS increased as lower operating profit was more than offset by below-the-line items Balance sheet fortified due to strong free cash flow generation, debt reduction, and effective management of working capital Investing in IC capacity to capitalize on market growth trends

Semiconductor: growing capacity and design activity More extensive use of semiconductors across multiple applications Supply chain regionalization driving investments in semiconductor fabs that creates redundant production capacity and drives photomask demand Differentiation by design becoming factor in mainstream (ASIC) and leading-edge applications Expanding EUV adoption drives semi manufacturer outsourcing of legacy technology nodes, increasing TAM for merchant suppliers Display: advanced displays driving innovation Global panel makers innovating to win AMOLED market share Growing competition drives innovation and greater mask value AMOLED manufacturing moving to larger form factor, requiring high-quality, advanced photomask Long-Term Trends Driving Photomask Demand Design and Manufacturing Complexity is Good for Photomask Demand

Strategic Investment Strategy Sustains Profitable Growth Proven Approach to Profitably Grow Revenue, Capture Market Share, and Improve ROIC Win market share in growing IC and FPD markets Leverage global footprint to benefit from IC regionalization trends Capitalize on FPD technology leadership to continue improving mix Enter long-term purchase agreements and obtain process of record Improved pricing environment in high-end and mainstream IC Dynamically align asset tool set to match end-market demand Increasing benefit from operating leverage GROW REVENUE IN EXCESS OF MARKET MARGIN EXPANSION IMPROVES PROFITS Operational Excellence Commercial Excellence Technology Leader Global Footprint WINNING THROUGH COMPETITIVE ADVANTAGES Organic growth through high-return targeted capacity expansionEnter LTPAs to mitigate investment risk and quickly ramp revenues STRATEGIC APPROACH TO CAPITAL INVESTMENTS

Income Statement Summary GAAP Non-GAAP1 $M (except EPS) Q423 Q/Q Y/Y Q423 Q/Q Y/Y Revenue 227.5 +1% +8% Gross Profit 84.9 -2% +6% Gross Margin 37.3% -140 bps -90 bps Operating Income 64.8 -1% +7% Operating Margin 28.5% -60 bps -30 bps Non-operating income 18.7 +19.6 +7.9 5.4 +1.8 +5.0 Income tax provision 20.3 +26% +26% 16.9 -3% +24% Minority interest 18.5 -13% +2% 16.1 -19% -1% Net income2 44.6 +65% +20% 37.2 +18% +19% Diluted EPS2 0.72 +0.28 +0.12 0.60 +0.09 +0.09 Days in quarter 93 +2 +1 1See reconciliation included in this presentation. 2Net income attributable to Photronics, Inc. shareholders. Margins declined due to lower premiums for expedited delivery Opex decreased as percent of sales as we effectively managed costs GAAP Non-operating income primarily consists of unrealized FX gain/loss Non-GAAP removes effect of FX gain/loss Minority interest reflects net income of IC JVs in Taiwan and China

IC Product Line $M Q423 Q/Q Y/Y High-End* 57.7 27% 30% Mainstream 106.8 (9%) (5%) Total 164.5 1% 5% High-end increased as stronger design activity drove demand across regions Mainstream softness Q/Q offset by better high-end demand Outlook New designs by customers to gain market share and support technology roadmap Regionalization driving investments for global chip capacity Able to maintain pricing in favorable supply/demand dynamic *28nm and smaller Totals may differ due to rounding

FPD Product Line *≥G10.5, AMOLED and LTPS Totals may differ due to rounding High-end grew on strong mobile display led by AMOLED demand Mainstream output lowered as more production dedicated to meet strong high-end demand Outlook Technology development drives demand for higher-value masks Mobile demand is expected to remain strong with rollout of new designs and emerging panel makers winning market share $M Q423 Q/Q Y/Y High-End* 53.3 7% 23% Mainstream 9.7 (13%) (9%) Total 63.0 3% 17%

Balance Sheet and Cash Flow Metrics *Net cash is a non-GAAP term. See reconciliation included in this presentation. Balance Sheet Provides Resilience, Enables Growth Strategy and Shareholder Value Creation $M Q423 Y/Y Q/Q Cash 499.3 +56% +11% Short-term Investments 12.9 -67% -53% Debt 24.6 -42% -8% Net Cash* 474.7 +71% +13% Operating Cash Flow 106.6 +35% +24% Capital Expenditures 52.5 -20% +149% Continued strong operating cash flow from income generation and working capital management Debt comprised of US equipment leases Capex targets growth in IC capacity & facility expansion Strong balance sheet able to fund investments, share repurchases, and strategic opportunities and remain resilient to effects of industry downturns

Q1 2024 Guidance Revenue ($M) 217-225 Operating Margin 27%-29% Taxes ($M) 11-15 Diluted non-GAAP EPS $0.45-$0.53 Diluted Shares (M) ~62 Full-year Capex (M) ~140 Incorporation of chips in IoT, 5G, Crypto and consumer products New designs to capture market share Advanced display technologies Outlook clouded by geopolitical uncertainty and macro-economic headwinds Driving margin expansion and cash flows to deliver long-term shareholder value

Appendix

Revenue by Product Group ($M) Total may differ due to rounding IC FPD Mainstream High-End Mainstream High-End Total Revenue IC Revenue FPD Revenue High-End: 28nm and smaller High-End: ≥G10.5, AMOLED and LTPS

Non-GAAP Financial Measures Non-GAAP Net Income attributable to Photronics, Inc. shareholders and non-GAAP earnings per share, Free Cash Flow, and Net Cash are "non-GAAP financial measures" as such term is defined by the Securities and Exchange Commission, and may differ from similarly named non-GAAP financial measures used by other companies. The attached financial supplement reconciles Photronics, Inc. financial results under GAAP to non-GAAP financial information. We believe these non-GAAP financial measures that exclude certain items are useful for analysts and investors to evaluate our future on-going performance because they enable a more meaningful comparison of our projected performance with our historical results. These non-GAAP metrics are not intended to represent funds available for our discretionary use and are not intended to represent, or be used as a substitute for, gross profit, operating income, net income, cash and cash equivalents, or cash flows from operations, as measured under GAAP. The items excluded from these non-GAAP metrics, but included in the calculation of their closest GAAP equivalent, are significant components of the condensed consolidated balance sheets and statement of cash flows and must be considered in performing a comprehensive assessment of overall financial performance. Please refer to the non-GAAP reconciliations on the following pages.

Non-GAAP Financial Measures

Non-GAAP Financial Measures