AURORA, Ill., Apr 22, 2004 /PRNewswire-FirstCall via COMTEX/ -- 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 second fiscal quarter, which ended March 31, 2004.
Total revenue for the second fiscal quarter of 2004 was $73.5 million, down 3.6% from $76.3 million in the prior quarter and up 18.2% from $62.2 million in the second quarter a year ago. While overall sales volumes increased slightly from the prior quarter, revenue was adversely affected by a decline in the overall average selling price as a result of a lower valued product mix and selective price reductions.
Gross profit of $36.1 million in the quarter was down by 3.0% sequentially from the $37.3 million reported in the prior quarter and up 18.9% from the $30.4 million reported in the year ago quarter. As a percentage of revenue, gross profit increased to 49.2% this quarter from 48.8% last quarter, primarily due to higher yields in the company's manufacturing process and overall lower product costs, partially offset by lower prices. Gross profit in the same quarter of last year represented 48.9% of revenue.
Operating expenses of $21.3 million, consisting of research and development, selling and marketing, and general and administrative expenses, increased sequentially by $1.6 million, and were $4.5 million higher than the comparable quarter last year. The increase from the prior quarter was partially attributable to approximately $0.5 million in separation costs associated with the departure of two executives, which the company had previously disclosed, along with annual wage and salary increases that became effective on January 1, higher depreciation, and a modest increase in research and development expense.
Net income for the quarter was $9.7 million, down 16.2% from $11.6 million in the previous quarter and up 7.3% from $9.1 million in the year ago quarter. Diluted earnings per share were $0.39 this quarter, compared to $0.46 in the previous quarter and $0.37 in the year ago quarter.
"While it has been a challenging quarter, we believe we are well-positioned for continued leadership in the competitive CMP slurry arena," stated William P. Noglows, Cabot Microelectronics' Chairman and CEO. "We view our operational and technical capabilities and facilities as unmatched in the industry, enabling us to continue to meet our customers' increasing requirements for product quality and performance. Further, the breadth and depth of our infrastructure, along with a renewed focus on costs, provide us with continued opportunities to capture efficiencies and economies of scale in our business."
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 800-893-3008, access code 4711975. Callers outside of the U.S. can dial 706-634-5531. 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, headquartered in Aurora, Illinois, is the leading supplier of CMP slurries for polishing various materials used in semiconductor manufacturing processes. The company's products play a critical role in the production of the most advanced semiconductor devices, enabling the manufacture of smaller, faster and more complex devices by its customers. 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 quarterly report on Form 10-Q for the quarter ended December 31, 2003, and our Annual Report on Form 10-K for the fiscal year ended September 30, 2003, both filed with the SEC. Cabot Microelectronics Corporation assumes no obligation to update this forward-looking information.
Contact: William S. Johnson Vice President and Chief Financial Officer Cabot Microelectronics Corporation 630/375-6631 CABOT MICROELECTRONICS CORPORATION CONSOLIDATED STATEMENTS OF INCOME (Unaudited and amounts in thousands, except per share amounts) Quarter Ended Six Months Ended March 31, Dec. 31, March 31, March 31, March 31, 2004 2003 2003 2004 2003 Revenue $73,515 $76,279 $62,201 $149,794 $119,474 Cost of goods sold 37,366 39,026 31,786 76,392 59,451 Gross profit 36,149 37,253 30,415 73,402 60,023 Operating expenses: Research and development 11,143 10,723 9,609 21,866 18,244 Selling and marketing 4,363 3,783 2,554 8,146 5,132 General and administrative 5,749 5,124 4,595 10,873 8,963 Amortization of intangibles 85 85 85 170 170 Total operating expenses 21,340 19,715 16,843 41,055 32,509 Operating income 14,809 17,538 13,572 32,347 27,514 Other income (expense), net (86) 36 43 (50) 38 Income before income taxes 14,723 17,574 13,615 32,297 27,552 Provision for income taxes 5,006 5,976 4,561 10,982 9,230 Net income $9,717 $11,598 $9,054 $21,315 $18,322 Basic earnings per share $0.39 $0.47 $0.37 $0.86 $0.75 Weighted average basic shares outstanding 24,785 24,733 24,346 24,761 24,325 Diluted earnings per share $0.39 $0.46 $0.37 $0.85 $0.75 Weighted average diluted shares outstanding 24,926 24,994 24,593 24,935 24,589 CABOT MICROELECTRONICS CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited and amounts in thousands) March 31, September 30, 2004 2003 ASSETS: Current assets: Cash and cash equivalents $140,264 $111,318 Accounts receivable, net 38,452 37,564 Inventories, net 23,861 23,814 Other current assets 8,427 6,416 Total current assets 211,004 179,112 Property, plant and equipment, net 129,799 133,695 Other long-term assets 2,660 2,810 Total assets $343,463 $315,617 LIABILITIES AND STOCKHOLDERS' EQUITY: Current liabilities: Accounts payable $14,398 $12,521 Capital lease obligations 1,591 1,716 Accrued expenses and other current liabilities 12,141 14,679 Total current liabilities 28,130 28,916 Capital lease obligations 6,835 7,452 Deferred income taxes and other long-term liabilities 8,669 7,476 Total liabilities 43,634 43,844 Stockholders' equity 299,829 271,773 Total liabilities and stockholders' equity $343,463 $315,617
SOURCE Cabot Microelectronics Corporation
William S. Johnson, Vice President and Chief Financial Officer of Cabot Microelectronics Corporation, +1-630-375-6631