AURORA, Ill., Apr 24, 2003 /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 ended March 31, 2003.
Total revenue for the second fiscal quarter of 2003 was $62.2 million, up 8.6% on a sequential basis from $57.3 million in the prior quarter and up 23.1% from the second quarter a year ago. The majority of the increase from the prior quarter was due to higher sales volume in the Asia Pacific region, particularly Taiwan. On a product basis, the Company saw its most significant revenue growth this quarter from sales of its slurries for polishing copper, which represent the leading edge of CMP technology.
Gross profit in the second fiscal quarter of $30.4 million was up sequentially from $29.6 million. However, as a percentage of revenue, gross profit decreased from 51.7% last quarter to 48.9%. The percentage decline in gross profit resulted primarily from higher manufacturing costs incurred to meet increasing customer requirements for higher product quality and, to a lesser extent, new price arrangements in conjunction with certain broader strategic customer relationships. Gross profit in the year ago quarter was $25.3 million or 50.0% of revenue.
Operating expenses of $16.8 million, consisting of research and development (R&D), selling and marketing, and general and administrative expenses, were up sequentially by $1.2 million. The increase was mainly due to higher R&D spending on new product development. Operating expenses increased by $1.6 million from the year ago quarter, primarily due to increases in R&D efforts. The increase in R&D spending is consistent with the Company's strategy of investing to maintain its technology leadership.
Net income for the quarter was $9.1 million, compared to $9.3 million in the previous quarter and $7.0 million in the year ago quarter. Diluted earnings per share were $0.37 this quarter, compared to $0.38 in the previous quarter and $0.28 in the year ago quarter.
"We are pleased with our overall financial performance for the quarter in light of the continued difficult conditions in the semiconductor industry and global economy," stated Dr. Matthew Neville, Cabot Microelectronics, Chairman and CEO. "We continue to invest in R&D to maintain our technology leadership. In parallel with our historical technology focus, we are also increasing our emphasis on operations excellence in order to satisfy our customers' heightened performance requirements for our products to match their technology advances."
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 . For assistance, call 1-630-499-2600. This press release, as well as the script of 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, Ill., 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 1-630-499-2600.
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, 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, 2002, and our Annual Report on Form 10-K for the fiscal year ended September 30, 2002, both filed with the SEC. Cabot Microelectronics Corporation assumes no obligation to update this forward- looking information.
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, 2003 2002 2002 2003 2002 Revenue $62,201 $57,273 $50,520 $119,474 $101,524 Cost of goods sold 31,786 27,665 25,262 59,451 49,008 Gross profit 30,415 29,608 25,258 60,023 52,516 Operating expenses: Research and development 9,609 8,635 6,429 18,244 13,376 Selling and marketing 2,554 2,578 2,370 5,132 4,728 General and administrative 4,595 4,368 5,397 8,963 9,281 Litigation settlement - - 1,000 - 1,000 Amortization of intangibles 85 85 91 170 181 Total operating expenses 16,843 15,666 15,287 32,509 28,566 Operating income 13,572 13,942 9,971 27,514 23,950 Other income (expense), net 43 (5) (151) 38 (468) Income before income taxes 13,615 13,937 9,820 27,552 23,482 Provision for income taxes 4,561 4,669 2,869 9,230 7,514 Net income $9,054 $9,268 $6,951 $18,322 $15,968 Basic earnings per share $0.37 $0.38 $0.29 $0.75 $0.66 Weighted average basic shares outstanding 24,346 24,300 24,140 24,325 24,119 Diluted earnings per share $0.37 $0.38 $0.28 $0.75 $0.65 Weighted average diluted shares outstanding 24,593 24,579 24,583 24,589 24,558 CABOT MICROELECTRONICS CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited and amounts in thousands) March 31, September 30, 2003 2002 ASSETS: Current assets: Cash and cash equivalents $87,886 $69,605 Accounts receivable, net 28,147 26,082 Inventories, net 22,869 21,959 Other current assets 6,391 5,637 Total current assets 145,293 123,283 Property, plant and equipment, net 128,461 132,264 Other long-term assets 2,672 2,838 Total assets $276,426 $258,385 LIABILITIES AND STOCKHOLDERS' EQUITY: Current liabilities: Accounts payable $9,961 $11,748 Capital lease obligations 1,639 1,585 Accrued expenses, income taxes payable and other current liabilities 16,957 17,238 Total current liabilities 28,557 30,571 Long-term debt - 3,500 Capital lease obligations 8,126 8,865 Deferred income taxes and other long- term liabilities 2,820 1,943 Total liabilities 39,503 44,879 Stockholders' equity 236,923 213,506 Total liabilities and stockholders' equity $276,426 $258,385 Contact: William S. Johnson Vice President and Chief Financial Officer Cabot Microelectronics Corporation 630/375-6631
SOURCE Cabot Microelectronics Corp.
William S. Johnson, Vice President and Chief Financial Officer of Cabot Microelectronics Corporation, +1-630-375-6631