AURORA, Ill., Jan. 22 /PRNewswire-FirstCall/ -- Cabot Microelectronics Corporation (Nasdaq: CCMP), the leading supplier of chemical mechanical planarization (CMP) polishing slurries to the semiconductor industry, today reported financial results for its first fiscal quarter ended December 31, 2003.
Total revenue for the first fiscal quarter of 2004 was $76.3 million, up 12.3% on a sequential basis from $67.9 million in the prior quarter and up 33.2% from $57.3 million in the first quarter a year ago. The revenue increase this quarter was primarily due to strengthening demand for the company's products within the semiconductor industry. Sequentially higher sales levels were achieved in all product lines and all geographic regions. Average price per gallon increased slightly this quarter due to better product mix and the effect of the U.S. dollar's weakening against the Japanese Yen.
Gross profit of $37.3 million in the first fiscal quarter was up sequentially from $34.4 million. However, as a percentage of revenue, gross profit decreased from 50.7% last quarter to 48.8%. This quarter gross profit was adversely affected by higher manufacturing and other product costs associated with meeting increasing customer requirements for higher product quality and greater product consistency. These higher costs this quarter more than offset the combined benefit of higher capacity utilization, due to this quarter's higher level of sales, and the absence of the $2.0 million charge recorded last quarter related to a minimum purchase obligation under a raw material supply agreement. Gross profit in the year ago quarter was $29.6 million, which represented 51.7% of revenue.
Operating expenses of $19.7 million, consisting of research and development, selling and marketing, and general and administrative expenses, decreased sequentially $0.8 million, and were $4.0 million higher than the year ago quarter. This decrease from the prior quarter was mainly due to lower spending on wafers and supplies used in the company's research and development program, and was partially offset by a modest increase in staffing costs. Operating expenses represented 25.8% of sales this quarter, compared with 30.2% in the prior quarter and 28.3% for full fiscal year 2003.
Net income for the quarter was $11.6 million, up 20.2% from $9.6 million in the previous quarter and up 25.1% from $9.3 million in the year ago quarter. Diluted earnings per share were $0.46 this quarter, compared to $0.39 in the previous quarter and $0.38 in the year ago quarter.
"We are pleased with our overall sales growth and profitability this quarter," stated William P. Noglows, Cabot Microelectronics' Chairman and CEO. "We believe that the investments and commitments we made during the prolonged industry downturn have positioned us well for what appears to be a strong recovery in the semiconductor industry. Our operating profit this quarter demonstrates our ability to leverage our substantial investment in research and development and other fixed operating expenses as sales increase. We remain committed to maintaining our leadership position in this competitive CMP slurry arena."
Cabot Microelectronics' quarterly earnings conference call will be held today at 9:00 a.m. Central Time. The live conference call and a subsequent replay will be available via webcast at www.cabotcmp.com . Access to the live call is also available by phone at 800-923-0061, access code 4711006. Callers outside of the U.S. can dial 706-634-5545. For assistance, call 630-499-2600. This press release, as well as the transcript of the formal comments made during the conference call, will be available in the Investor Relations section of the company's web site at www.cabotcmp.com .
About Cabot Microelectronics
Cabot Microelectronics Corp., headquartered in Aurora, IL., is the leading supplier of CMP slurries for polishing various materials used in semiconductor manufacturing processes. These products enable manufacturers of integrated circuits to make smaller, faster and more complex devices and improve their production processes. For more information about Cabot Microelectronics, visit www.cabotcmp.com or call 630-499-2600.
Safe Harbor Statement
This news release may include statements that constitute "forward-looking statements" within the meaning of federal securities regulations. These forward-looking statements include statements related to future sales and operating results, company and industry growth and trends, growth of this market, international events, product performance, new product introductions and development of new products and technologies by Cabot Microelectronics. These forward-looking statements involve a number of risks, uncertainties, and other factors, including those described from time to time in Cabot Microelectronics' filings with the Securities and Exchange Commission (SEC), that could cause the actual results to differ materially from those described by these forward-looking statements. In particular, see "Risks Relating to Our Business" in Management's Discussion and Analysis in our annual report on Form 10-K for the fiscal year ended September 30, 2003, filed with the SEC. Cabot Microelectronics Corporation assumes no obligation to update this forward-looking information.
CABOT MICROELECTRONICS CORPORATION CONSOLIDATED STATEMENTS OF INCOME (Unaudited in thousands, except per share amounts) Quarter Ended Dec. 31, Sept. 30, Dec. 31, 2003 2003 2002 Revenue $76,279 $67,903 $57,273 Cost of goods sold 39,026 33,458 27,665 Gross profit 37,253 34,445 29,608 Operating expenses: Research and development 10,723 12,469 8,635 Selling and marketing 3,783 3,338 2,578 General and administrative 5,124 4,607 4,368 Amortization of intangibles 85 85 85 Total operating expenses 19,715 20,499 15,666 Operating income 17,538 13,946 13,942 Other income (expense), net 36 (111) (5) Income before income taxes 17,574 13,835 13,937 Provision for income taxes 5,976 4,186 4,669 Net income $11,598 $9,649 $9,268 Basic earnings per share $0.47 $0.39 $0.38 Weighted average basic shares outstanding 24,733 24,591 24,300 Diluted earnings per share $0.46 $0.39 $0.38 Weighted average diluted shares outstanding 24,994 25,049 24,579 CABOT MICROELECTRONICS CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited and amounts in thousands) December 31, September 30, 2003 2003 ASSETS: Current assets: Cash and cash equivalents $127,359 $111,318 Accounts receivable, net 41,009 37,564 Inventories, net 22,682 23,814 Other current assets 7,039 6,416 Total current assets 198,089 179,112 Property, plant and equipment, net 132,117 133,695 Other long-term assets 2,728 2,810 Total assets $332,934 $315,617 LIABILITIES AND STOCKHOLDERS' EQUITY: Current liabilities: Accounts payable $12,819 $12,521 Capital lease obligations 1,746 1,716 Accrued expenses, income taxes payable and other current liabilities 16,133 14,679 Total current liabilities 30,698 28,916 Capital lease obligations 7,054 7,452 Deferred income taxes and other long- term liabilities 8,108 7,476 Total liabilities 45,860 43,844 Stockholders' equity 287,074 271,773 Total liabilities and stockholders' equity $332,934 $315,617 Contact: William S. Johnson Vice President and Chief Financial Officer Cabot Microelectronics Corporation 630/375-6631
SOURCE Cabot Microelectronics Corporation -0- 01/22/2004 /CONTACT: William S. Johnson, Vice President and Chief Financial Officer of Cabot Microelectronics Corporation, +1-630-375-6631/ /Web site: http://www.cabotcmp.com / (CCMP) CO: Cabot Microelectronics Corporation ST: Illinois IN: CPR HRD MLM ENV CHM SU: ERN CCA SH-AM -- CGTH018 -- 7711 01/22/2004 08:00 EST http://www.prnewswire.com