Orbotech Reports Third Quarter 2017 Results

·   Revenues of $245.7 million

·   Gross margin of 48.0%

·   GAAP EPS of $0.75 (diluted); non-GAAP EPS of $0.91 (diluted)

2017 fourth quarter guidance

·   Revenue range: $245 million to $255 million

·   Gross margin of approximately 48.0% based on current expectations of product mix  

ORBOTECH LTD. (NASDAQ: ORBK) (the “Company“) today announced its consolidated financial results for the third quarter of 2017.

Commenting on the results, Asher Levy, Chief Executive Officer, said: “Our very strong third quarter financial performance reflects robust execution of our business plans, the wide acceptance of our new solutions and continued transformation of our technological innovation into improved revenues and profits.  Each of our three divisions performed well and we are experiencing favorable business momentum across the board.  These favorable industry conditions, in conjunction with our technological leadership, create new opportunities for Orbotech in areas such as advanced smartphones, automotive and flat panel displays, where our solutions enable the most advanced manufacturing technologies and, in turn, increase our total addressable market.”

Revenues for the third quarter of 2017 totaled $245.7 million, compared with $205.0 million in the third quarter of 2016, and $210.7 million in the second quarter of 2017.

In the Company’s Production Solutions for Electronics Industry segment:

·   Revenues from the Company’s printed circuit board (“PCB“) business were $85.7 million (including $52.6 million in equipment sales) in the third quarter of 2017.  This compares to PCB revenues of $69.0 million (including $38.0 million in equipment sales) in the third quarter of 2016.

·   Revenues from the Company’s flat panel display (“FPD“) business were $76.0 million (including $64.5 million in equipment sales) in the third quarter of 2017.  This compares to FPD revenues of $59.8 million (including $49.4 million in equipment sales) in the third quarter of 2016.

·   Revenues from the Company’s semiconductor device (“SD“) business were $78.5 million (including $65.9 million in equipment sales) in the third quarter of 2017.  This compares to SD revenues of $71.5 million (including $57.4 million in equipment sales) in the third quarter of 2016.

Revenues in the Company’s other segments totaled $5.4 million in the third quarter of 2017, compared with $4.6 million in the third quarter of 2016.

Service revenues for the third quarter of 2017 were $59.2 million, compared with $58.0 million in the third quarter of 2016.

Gross profit and gross margin in the third quarter of 2017 were $118.0 million and 48.0%, respectively, compared with $96.2 million and 46.9%, respectively, in the third quarter of 2016.

GAAP net income and GAAP net income margin in the third quarter of 2017 were $36.6 million and 14.9% respectively, compared with $24.7 million, and 12.1% respectively in the third quarter of 2016.

GAAP earnings per share (diluted) for the third quarter of 2017 were $0.75, compared with $0.51, for the third quarter of 2016.

Adjusted EBITDA (as defined below) and adjusted EBITDA margin for the third quarter of 2017 were $57.6 million and 23.5%, respectively, compared with $43.8 million and 21.4%, respectively, in the third quarter of 2016.

Non-GAAP net income and non-GAAP net income margin for the third quarter of 2017 were $44.7 million and 18.2%, respectively, compared with $33.0 million and 16.1%, respectively, for the third quarter of 2016.

Non-GAAP earnings per share (diluted) for the third quarter of 2017 were $0.91, compared with $0.68 per share, for the third quarter of 2016.

A reconciliation of each of the Company’s non-GAAP measures to the comparable GAAP measure (the “Reconciliation“) is included at the end of this press release.

As of September 30, 2017, the Company had cash, cash equivalents, short term bank deposits and marketable securities of $247.0 million, and debt of $72.4 million.  As of September 30, 2017, the actual number of ordinary shares outstanding was approximately 48.0 million.

Fourth quarter 2017 Guidance

The Company expects revenues for the fourth quarter of 2017 to be in the range of $245 million to $255 million; and gross margin for the fourth quarter of 2017 to be approximately 48.0%, based on current expectations of product mix.

Investor Day

The Company will host an Investor Day on Monday, November 6, 2017 at the W Hotel in New York City.  The event will include the introduction of a new Orbotech financial model as well as presentations by business teams.  Presentations will commence promptly at 9:00 a.m. EST and the event is expected to conclude at approximately 1:00 p.m. EST.  To register for attendance, please contact Rami Rozen, Orbotech Director of Investor Relations, on [email protected]  A webcast of the presentation will be broadcast simultaneously through a link on the Investors section of the Orbotech Ltd. website.  A replay of the webcast, as well as presentation materials, will remain available for 90 days.

Conference Call

An earnings conference call for the Company’s third quarter 2017 results is scheduled for today, November 1, 2017, at 8:30 a.m. EDT.  The dial-in number for the conference call is + 1-646-254-3362 or (US toll-free) 877-280-2296 and a replay will be available on telephone number +1-719-457-0820 or (US toll-free) 888-203-1112 until November 15, 2017.  The pass code is 9707467 or Orbotech Q3.  A live webcast of the conference call can also be heard by accessing the Company’s website at: https://edge.media-server.com/m6/p/y9sehn6g.  The webcast will remain available for 12 months at: http://investors.orbotech.com/phoenix.zhtml?c=71865&p=irol-audioarchives.

About Orbotech Ltd.

Orbotech Ltd. is a leading global supplier of yield-enhancing and process-enabling solutions for the manufacture of electronics products.  Orbotech provides cutting-edge solutions for use in the manufacture of PCBs, FPDs and SDs, designed to enable the production of innovative, next generation electronic products and improve the cost effectiveness of existing and future electronics production processes.  Orbotech’s core business lies in enabling electronic device manufacturers to inspect and understand PCBs and FPDs to verify their quality (‘reading’); pattern the desired electronic circuitry on the relevant substrate and perform three dimensional shaping of metalized circuits on multiple surfaces (‘writing’); and utilize advanced vacuum deposition and etching processes in SD and semiconductor manufacturing (‘connecting’).  Orbotech refers to this ‘reading’, ‘writing’ and ‘connecting’ as enabling the ‘Language of Electronics’.  For further information, visit http://www.orbotech.com.

Cautionary Statement Regarding Forward-Looking Statements

Except for historical information, the matters discussed in this press release are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.  These statements relate to, among other things, future prospects, developments and business strategies and involve certain risks and uncertainties.  The words “anticipate,” “believe,” “could,” “will,” “plan,” “expect” and “would” and similar terms and phrases, including references to assumptions, have been used in this press release to identify forward-looking statements.  These forward-looking statements are made based on management’s expectations and beliefs concerning future events affecting Orbotech and are subject to uncertainties and factors relating to Orbotech’s operations and business environment, all of which are difficult to predict and many of which are beyond the Company’s control.  Many factors could cause the actual results to differ materially from those projected including, without limitation, cyclicality in the industries in which the Company operates, the Company’s production capacity, timing and occurrence of product acceptance (the Company defines ‘bookings’ and ‘backlog’ as purchase arrangements with customers that are based on mutually agreed terms, which, in some cases for bookings and backlog, may still be subject to completion of written documentation and may be changed or cancelled by the customer, often without penalty), fluctuations in product mix, within and among divisions, worldwide economic conditions generally, especially in the industries in which the Company operates, the timing and strength of product and service offerings by the Company and its competitors, changes in business or pricing strategies, changes in the prevailing political and regulatory framework in which the relevant parties operate, including as a result of the ‘Brexit’ process and administration change in the United States, or in economic or technological trends or conditions, including currency fluctuations, inflation and consumer confidence, on a global, regional or national basis, the level of consumer demand for sophisticated devices such as smartphones, tablets and other electronic devices as well as automobiles, the Company’s global operations and its ability to comply with varying legal, regulatory, exchange, tax and customs regimes, the timing and outcome of tax audits, including the ongoing audit of tax years 2012-2014 in Israel and related criminal investigation (see below), the Company’s ability to achieve strategic initiatives, including related to its acquisition strategy, the Company’s debt and corporate financing activities; the final timing and outcome, and impact of the criminal matter and ongoing investigation in Korea, including any impact on existing or future business opportunities in Korea and elsewhere, any civil actions related to the Korean matter brought by third parties, including the Company’s customers, which may result in monetary judgments or settlements, expenses associated with the Korean matter, and ongoing or increased hostilities in Israel and the surrounding areas.

In May 2017, the Company received a best judgment tax assessment from the Israel Tax Authority (the “ITA”) with respect to an audit of the Company for the fiscal years 2012-2014 (the “Assessment”), for an aggregate amount of tax against the Company, after offsetting all operating losses for tax purposes available through the end of 2014, of approximately NIS 207 million (currently approximately U.S. $58 million) which amount includes related interest and linkage differentials (as of date of the Assessment).  All amounts related to the Assessment are given after application of the Company’s accumulated losses.  Approximately 80% of the amount of the Assessment, assuming that all accumulated losses are set off against the other matters included in the Assessment, relates to the following two matters: (1) the use of tax exempt profits derived from the Company’s approved and benefitting enterprises under the Law for the Encouragement of Capital Investment, 1959, in particular in its investments in, or acquisitions of, foreign subsidiaries; and (2) the purchase of shares of the Company by its foreign subsidiaries during the audit period.  The Company has not taken any reserves or provisions related to these two matters because it reasonably believes its positions are more likely than not correct as a legal matter.  The Company intends vigorously to contest the ITA’s position on both of these matters and does not anticipate establishing a provision related to these matters.  The other significant item in the Assessment relates to the Company’s transfer pricing.  As of September 30, 2017, the Company’s tax provisions with respect to the audit period cover at least a majority of the remaining 20% of the Assessment.  However, because of the ongoing criminal investigation against the Company, certain of its employees and its tax consultant related to tax positions taken by the Company in the audit period as well as in prior periods, the Company has not conducted a comprehensive independent review of the work of its employees and tax consultant involved in evaluating and establishing its tax positions, including with respect to this and certain other matters that are the subject of the Assessment.  The Company expects to begin this review process in connection with the preparation of its annual financial statements and annual report, however it cannot assure investors of the timing or outcome of such review.

If the Company’s evaluation of its tax positions proves to be inaccurate, it may be required to increase its provisions or take a charge in future periods.  The outcome of its review may also impact the Company’s results of operations as a result of tax positions taken for subsequent fiscal years.  The amount of the increase and/or the charge against earnings could be material with respect to the audit period and subsequent periods.  In addition, the Company does not have any insight into the scope or time period of the criminal investigation or the timing of any prosecutorial action related to the investigation which may occur in the coming days, weeks, months or years.  Although the Company cannot predict the timing of any prosecutorial action, the Company expects to be summoned to the prosecutor’s office for a hearing, at which it will have the opportunity to present its positions, prior to any indictments of the Company and/or certain of its employees and/or payment of monetary amounts in lieu of such indictments.  The Company has not conducted its own investigation into any matters that may be the subject of such investigation and will only do so once the criminal investigation has been completed.  The Company intends vigorously to contest the Assessment in accordance with Israeli law as well as defend itself and its employees in the criminal matter, but it cannot assure investors as to the outcome or timing of completion of either process, including the amount of tax ultimately payable related to 2012-2014 and prior fiscal years, or any additional taxes, penalties, criminal sanctions, indictments, fines and other amounts or that may be imposed as a result of the Assessment and criminal investigation, which may be material in amount or in adverse impact on the Company’s results of operations, financial position and reputation.

The foregoing information should be read in connection with the Company’s Annual Report on Form 20-F for the year ended December 31, 2016, and subsequent SEC filings.  The Company is subject to the foregoing and other risks detailed in those reports.  The Company assumes no obligation to update the information in this press release to reflect new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measures

Non-GAAP net income, non-GAAP net income margin, non-GAAP net income per share detailed in the Reconciliation exclude charges, income or losses, as applicable, related to one or more of the following: (i) equity-based compensation expenses; (ii) certain items associated with acquisitions, including amortization of intangibles assets and acquisition costs; (iii) certain items associated with sale or disposition of businesses; (iv) certain tax impact; (v) share in losses/ profits of equity method investee; and/or (vi) charges associated with the financing activities related to the retirement of the Company’s credit Agreement entered into in 2014.

The Company uses the non-GAAP measures indicated in the Reconciliation to supplement the Company’s financial results presented on a GAAP basis.  These non-GAAP measures exclude equity based compensation expenses, amortization of intangible assets, share in losses/ profits of equity method investee, as well as certain financial and other expenses and items that are believed to be helpful in understanding and comparing past operating and financial performance with current results.  Management uses all of the non-GAAP measures to evaluate the Company’s operating and financial performance in light of business objectives and for planning purposes.  These measures are not in accordance with GAAP and may differ from non-GAAP methods of accounting and reporting used by other companies.  The Company believes that these measures enhance investors’ ability to review the Company’s business from the same perspective as the Company’s management and facilitate comparisons with results for prior periods.  In addition, these non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods.  However, the non-GAAP measures presented are subject to limitations as an analytical tool because they exclude certain recurring items (such as, equity-based compensation, financial expense and amortization of intangible assets) as described below and in the Reconciliation.  The presentation of this additional non-GAAP information should not be considered in isolation or as a substitute for net income; net income attributable to Orbotech Ltd. or earnings per share prepared in accordance with GAAP, and should be read only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP.  For a quantification of the adjustments made to comparable GAAP measures, please see the Reconciliation.

The effect of equity-based compensation expenses has been excluded from the non-GAAP measures.  Although equity-based compensation is a key incentive offered to employees, and the Company believes such compensation contributed to the revenues earned during the periods presented and also believes it will contribute to the generation of future period revenues, the Company continues to evaluate its business performance excluding equity based compensation expenses.  Equity-based compensation expenses will recur in future periods.

The effects of amortization of intangible assets have also been excluded from the measures.  This item is inconsistent in amount and frequency and is significantly affected by the timing and size of acquisitions and dispositions.  Investors should note that the use of intangible assets contributed to revenues earned during the periods presented and will contribute to future period revenues as well.  Amortization of intangible assets will recur in future periods and the Company may be required to record impairment charges in the future.  The Company believes that it is useful for investors to understand the effects of these items on total operating expenses.

The effects of a sale or disposition of a business have also been excluded from the non-GAAP measures.  This item is inconsistent in amount and frequency.  By excluding the item from the non-GAAP measures, management is better able to evaluate the Company’s ability to utilize its existing businesses and estimate the long-term value that remaining businesses will generate for the Company.  Furthermore, the Company believes that this adjustment correlates more closely with the sustainability of the Company’s operating performance.

Adjusted EBITDA is also a non-GAAP financial measure.  The Company defines adjusted EBITDA as net income attributable to Orbotech Ltd., further adjusted, in addition to the items described above, to exclude taxes on income, financial expenses (income) – net, amounts associated with non-controlling interests and depreciation.  The Company presents adjusted EBITDA because it considers it to be an important supplemental measure and believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in Orbotech’s industry.  Adjusted EBITDA margin is a measurement of Orbotech’s adjusted EBITDA as a percentage of its revenues.  Although the Company believes its presentation of adjusted EBITDA is useful, its adjusted EBITDA measure may not be comparable to similarly named measures presented by other companies.

For more information about all of the foregoing items, see the Reconciliation, the Company’s Annual Report on Form 20-F filed with the SEC for the year ended December 31, 2016, and its other SEC filings.

                                                                          ORBOTECH LTD.

                                              CONDENSED CONSOLIDATED BALANCE SHEETS

                                                                 U. S. dollars  in  thousands

                                                                                 (Unaudited)

September 30,

December 31,

2017

2016

ASSETS

CURRENT ASSETS:

    Cash and cash equivalents

$   237,754

$   216,292

    Restricted cash

12,487

    Marketable securities

201

    Short-term bank deposits

973

789

    Accounts receivable – trade

385,481

326,343

    Prepaid expenses and other current assets

52,750

47,258

    Inventories

164,049

132,435

              T o t a l  current assets

841,208

735,604

INVESTMENTS AND NON-CURRENT ASSETS:

    Marketable securities

8,058

7,012

    Funds in respect of employee rights upon retirement

10,105

8,375

    Deferred income taxes

22,323

19,840

    Equity method investee and other receivables

5,166

9,113

45,652

44,340

PROPERTY, PLANT AND EQUIPMENT, net

67,848

62,375

OTHER INTANGIBLE ASSETS, net

73,897

84,210

GOODWILL

176,804

176,374

              T o t a l  assets

$  1,205,409

$   1,102,903

LIABILITIES AND EQUITY

CURRENT LIABILITIES:

   Current maturities of long-term loan

$   16,364

$   16,364

    Accounts payable and accruals:

      Trade

82,883

72,085

      Other

117,032

114,692

    Deferred income

33,512

28,576

              T o t a l  current liabilities

249,791

231,717

LONG-TERM LIABILITIES:

    Long-term loan, net

56,001

72,002

    Liability with respect to Applied Microstructure, Inc. (“AMST”)

1,471

1,471

    Liability for employee rights upon retirement

24,357

22,973

    Deferred income taxes

12,425

14,392

    Other tax liabilities

10,771

7,567

              T o t a l  long-term liabilities

105,025

118,405

              T o t a l  liabilities

354,816

350,122

EQUITY:

    Share capital

2,390

2,381

    Additional paid-in capital

429,296

420,185

    Retained earnings

516,663

440,159

    Accumulated other comprehensive loss

(804)

(9,221)

947,545

853,504

    Less treasury shares, at cost

(99,539)

(99,539)

               T o t a l  Orbotech Ltd. equity

848,006

753,965

    Non-controlling interest

2,587

(1,184)

               T o t a l  equity

850,593

752,781

         T o t a l  liabilities and equity

$  1,205,409

$   1,102,903

                                                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                                                          U.S. dollars in thousands (except per share data)

                                                                                        (Unaudited)

Nine months ended

Three months ended

September 30,

September 30,

2017

2016

2017

2016

Revenues

$643,976

$591,360

$245,664

$204,953

Cost of revenues

340,224

319,634

127,652

108,739

Gross profit

303,752

271,726

118,012

96,214

Operating expenses:

Research and development, net

90,662

80,049

31,921

27,345

Selling, general and administrative

103,019

92,357

36,563

31,068

Equity in earnings ofP.C.B. Solutions L.P (“Frontline”)

(3,235)

(2,311)

(880)

(634)

Amortization of intangible assets

18,635

20,750

6,371

7,615

Total operating expenses

209,081

190,845

73,975

65,394

Operating income

94,671

80,881

44,037

30,820

Financial expenses – net

4,890

15,318

1,317

1,171

Income before taxes on income

89,781

65,563

42,720

29,649

Taxes on income

14,256

11,599

6,569

4,885

Share in losses of equity method investee

450

150

Net income

75,525

53,514

36,151

24,614

Net loss attributable to non-controlling interests

(979)

(293)

(403)

(99)

Net income attributable to Orbotech Ltd.

$76,504

$53,807

$36,554

$24,713

Basic earnings per share

$1.60

$1.20

$0.76

$0.52

Diluted earnings per share

$1.57

$1.17

$0.75

$0.51

Weighted average number of shares (in thousands)

used in computation of:

Basic earnings per share

47,914

44,867

47,995

47,397

Diluted earnings per share

48,812

45,813

48,903

48,385

                                                                                           ORBOTECH LTD.

                                                    RECONCILIATION OF GAAP TO NON-GAAP RESULTS

                                                        U.S. dollars in thousands (except per share data)

                                                                                                (Unaudited)

Nine months ended

Three months ended

September 30,

September 30,

2017

2016

2017

2016

Reported operating income on GAAP basis

$94,671

$80,881

$44,037

$30,820

Equity-based compensation expenses

6,982

4,319

2,480

1,361

Amortization of intangible assets

18,635

20,750

6,371

7,615

Non-GAAP operating income

$120,288

$105,950

$52,888

$39,796

Reported net income attributable to Orbotech Ltd. on GAAP basis

$76,504

$53,807

$36,554

$24,713

Equity-based compensation expenses

6,982

4,319

2,480

1,361

Amortization of intangible assets

18,635

20,750

6,371

7,615

Tax effect of non-GAAP adjustments

(2,244)

(2,410)

(748)

(887)

Share in losses of equity method investee

450

150

Charges associated with the retirement of the 2014 Credit Agreement

6,228

Non-GAAP net income

$99,877

$83,144

$44,657

$32,952

GAAP earnings per diluted share

$1.57

$1.17

$0.75

$0.51

Non-GAAP earnings per diluted share

$2.05

$1.81

$0.91

$0.68

Shares used in earnings per diluted share computation – in thousands

48,812

45,813

48,903

48,385

                                                                                    ORBOTECH LTD.

                                         RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA

                                                                                 U.S. dollars in thousands 

                                                                                          (Unaudited)

Nine months ended

Three months ended

September 30,

September 30,

2017

2016

2017

2016

Net income attributable to Orbotech Ltd. on GAAP basis

$76,504

$53,807

$36,554

$24,713

Minority interest and equity losses

(979)

157

(403)

51

Taxes on income

14,256

11,599

6,569

4,885

Financial expenses – net

4,890

15,318

1,317

1,171

Depreciation and amortization

32,749

32,997

11,101

11,599

Equity-based compensation expenses

6,982

4,319

2,480

1,361

ADJUSTED EBITDA

$134,402

$118,197

$57,618

$43,780

                                                                                                                  ORBOTECH LTD.

                                                                        CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                                                         U.S. dollars in thousands

                                                                                                          (Unaudited)

Nine months ended

Three months ended

September 30,

September 30,

2017

2016

2017

2016

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

$   75,525

$   53,514

$   36,151

$   24,614

Adjustment to reconcile net income to net cash

provided by operating activities:

Depreciation and amortization

32,749

32,997

11,101

11,599

Compensation relating to equity awards granted to

employees and others – net

6,982

4,319

2,480

1,361

Increase in liability for employee rights upon retirement, net

842

1,531

685

652

Long- term loans discount amortization

1,866

Deferred financing costs amortization

363

5,585

363

125

Deferred income taxes

(6,788)

(2,774)

(1,327)

(1,096)

Amortization of premium and accretion of discount on marketable

Securities, net

37

112

36

18

Equity in earnings of Frontline, net of dividend received

(363)

1,105

20

266

Other

127

631

(290)

243

Decrease (increase) in accounts receivable:

Trade

(59,138)

(35,315)

(24,245)

(28,091)

Other

(7,286)

608

(4,359)

4,311

Increase (decrease) in accounts payable and accruals:

Trade

10,747

(2,734)

(1,611)

938

Deferred income

4,936

(1,790)

2,503

(246)

Other

16,690

4,202

18,177

10,598

Increase in inventories

(29,811)

(4,571)

(11,907)

(3,456)

Net cash provided by operating activities

45,612

59,286

27,777

21,836

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property, plant and equipment

(19,850)

(17,387)

(7,936)

(5,272)

Consideration received for the sale of the Thermal Products business

12,000

Withdrawal of (investment in) bank deposits

(184)

5,714

2,469

(774)

Purchase of marketable securities

(1,994)

(4,836)

(2,592)

Redemption of marketable securities

804

3,617

1,280

Investment in equity method investee

(1,000)

Acquisition of the assets of AMST

Decrease (increase) in funds in respect of employee

rights upon retirement

(1,187)

194

(65)

68

Net cash used in investing activities*

(22,411)

(1,698)

(5,532)

(7,290)

CASH FLOWS FROM FINANCING ACTIVITIES:

Repayment of long- term loan

(239,635)

Repayment of bank loan

(16,364)

Bank loan, net of $2 million financing costs

108,031

Issuance of shares, net

99,962

Employee share options exercised

2,138

5,100

901

1,636

Net cash provided by (used in) financing activities

(14,226)

(26,542)

901

1,636

Net increase in cash, cash equivalents and restricted cash*

8,975

31,046

23,146

16,182

Cash, cash equivalents and restricted cash at beginning of period*

228,779

175,719

214,608

190,583

CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD*

$     237,754

$     206,765

$          237,754

$            206,765

* Reclassified

SOURCE Orbotech Ltd.

Related Links

http://www.orbotech.com

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About the Author: Carrie Brunner

Carrie Brunner grew up in a small town in northern New Brunswick. She studied chemistry in college, graduated, and married her husband one month later. They were then blessed with two baby boys within the first four years of marriage. Having babies gave their family a desire to return to the old paths – to nourish their family with traditional, homegrown foods; rid their home of toxic chemicals and petroleum products; and give their boys a chance to know a simple, sustainable way of life. They are currently building a homestead from scratch on two little acres in central Texas. There’s a lot to be done to become somewhat self-sufficient, but they are debt-free and get to spend their days living this simple, good life together with their five young children. Carrie writes mostly on provincial stories.
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