AURORA, Ill., Jul 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 third fiscal quarter ended June 30, 2003.
Total revenue for the third fiscal quarter of 2003 was $64.3 million, up 3.4% on a sequential basis from $62.2 million in the prior quarter and down 6.0% from $68.4 million in the third quarter a year ago. The majority of the increase from the prior quarter was due to revenue growth from sales of slurries for polishing applications at the leading edge of technology, such as copper interconnects for 130 nanometer IC devices. During this quarter the Company began selling direct to customers in Europe, Singapore and Malaysia rather than through a distributor. As anticipated, the draw down of the distributor's inventory during this transition period reduced revenue this quarter by approximately $3.7 million.
Gross profit in the third fiscal quarter of $32.9 million was up sequentially from $30.4 million. As a percentage of revenue, gross profit increased from 48.9% last quarter to 51.2%. The percentage increase in gross profit resulted primarily from lower manufacturing costs as well as improved product mix. Gross profit in the year ago quarter was $36.3 million or 53.0% of revenue. During the comparable quarter last year the Company experienced a significant sequential increase in revenue as the industry and its customers ramped production in anticipation of a strong recovery in the second half of 2002 that did not materialize and resulted in an over-build of IC device inventory.
Operating expenses of $18.3 million, consisting of research and development (R&D), selling and marketing, and general and administrative expenses, were up sequentially $1.5 million, and were $1.3 million higher than the year ago quarter. These increases were mainly due to higher R&D spending on new product development, which is consistent with the Company's strategy of investing to maintain its technology leadership.
Net income for the quarter was $9.8 million, compared to $9.1 million in the previous quarter and $13.3 million in the year ago quarter. Diluted earnings per share were $0.40 this quarter, compared to $0.37 in the previous quarter and $0.54 in the year ago quarter.
"We are pleased with our strong financial performance for the quarter," stated Dr. Matthew Neville, Cabot Microelectronics' Chairman and CEO. "Our results reflect the market's adoption of our industry-leading products in the manufacture of the most advanced integrated circuits. We continue to invest in both R&D to maintain our technology leadership, and our operations excellence initiatives to meet our customers' heightened performance requirements."
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. Callers outside of the U.S. can dial 706-634-5545. For assistance, call 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 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 March 31, 2003, 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.
CONTACT: William S. Johnson, Vice President and Chief Financial Officer of Cabot Microelectronics Corporation, +1-630-375-6631
CABOT MICROELECTRONICS CORPORATION CONSOLIDATED STATEMENTS OF INCOME (Unaudited and amounts in thousands, except per share amounts) Quarter Ended Nine Months Ended June 30, March 31, June 30, June 30, June 30, 2003 2003 2002 2003 2002 Revenue $64,288 $62,201 $68,377 $183,762 $169,901 Cost of goods sold 31,360 31,786 32,113 90,811 81,121 Gross profit 32,928 30,415 36,264 92,951 88,780 Operating expenses: Research and development 10,803 9,609 10,190 29,047 23,566 Selling and marketing 2,751 2,554 2,470 7,883 7,198 General and administrative 4,655 4,595 4,260 13,618 13,541 Litigation settlement - - - - 1,000 Amortization of intangibles 85 85 90 255 271 Total operating expenses 18,294 16,843 17,010 50,803 45,576 Operating income 14,634 13,572 19,254 42,148 43,204 Other income (expense), net 46 43 1,160 84 692 Income before income taxes 14,680 13,615 20,414 42,232 43,896 Provision for income taxes 4,918 4,561 7,147 14,148 14,661 Net income $9,762 $9,054 $13,267 $28,084 $29,235 Basic earnings per share $0.40 $0.37 $0.55 $1.15 $1.21 Weighted average basic shares outstanding 24,389 24,346 24,193 24,341 24,140 Diluted earnings per share $0.40 $0.37 $0.54 $1.14 $1.19 Weighted average diluted shares outstanding 24,639 24,593 24,521 24,600 24,565 CABOT MICROELECTRONICS CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited and amounts in thousands) June 30, September 30, 2003 2002 ASSETS: Current assets: Cash and cash equivalents $99,268 $69,605 Accounts receivable, net 30,501 26,082 Inventories, net 22,439 21,959 Other current assets 7,528 5,637 Total current assets 159,736 123,283 Property, plant and equipment, net 127,581 132,264 Other long-term assets 2,468 2,838 Total assets $289,785 $258,385 LIABILITIES AND STOCKHOLDERS' EQUITY: Current liabilities: Accounts payable $11,490 $11,748 Capital lease obligations 1,667 1,585 Accrued expenses, income taxes payable and other current liabilities 15,058 17,238 Total current liabilities 28,215 30,571 Long-term debt - 3,500 Capital lease obligations 7,747 8,865 Deferred income taxes and other long- term liabilities 4,685 1,943 Total liabilities 40,647 44,879 Stockholders' equity 249,138 213,506 Total liabilities and stockholders' equity $289,785 $258,385
SOURCE Cabot Microelectronics Corp.
William S. Johnson, Vice President and Chief Financial Officer of Cabot Microelectronics Corporation, +1-630-375-6631