CCMP CMC Materials Inc

Cabot Microelectronics Corporation (Nasdaq: CCMP), the world�s leading supplier of chemical mechanical planarization (CMP) polishing slurries to the semiconductor industry, today reported financial results for its third quarter of fiscal 2008, which ended June 30. Total revenue during the third fiscal quarter was $97.0 million, which was 9.0 percent higher than the $89.0 million reported in the same quarter last year and represents a 2.7 percent increase compared to $94.5 million last quarter. Year to date, total revenue increased 15.0 percent from the same period in fiscal 2007. Record revenue this quarter was driven by solid demand for the company�s core CMP slurry products for semiconductor applications � tungsten, dielectrics and copper, aggregate revenue from which increased by 9.4 percent year over year and 3.4 percent sequentially. In addition, revenue from polishing pads grew 38.1 percent from last quarter. Revenues from the company�s engineered surface finishes business and slurry for data storage applications decreased compared to both the previous quarter and the same quarter last year. Gross profit, expressed as a percentage of revenue, was 46.8 percent this quarter, which was down from 47.7 percent in the same quarter a year ago and up from 44.7 percent last quarter. Compared to the year ago quarter, gross profit percentage decreased due to higher fixed costs, mainly associated with pad operations, lower slurry and pad manufacturing yields, and the effect of foreign exchange rate changes, partially offset by a higher valued product mix. Compared to the prior quarter, gross profit percentage increased driven by a higher valued product mix and higher pad manufacturing yields, partially offset by lower utilization of the company�s manufacturing capacity. Year to date, gross profit represents 46.5 percent of revenue, which is consistent with the company�s full fiscal year guidance range of 46 to 48 percent of revenue. Operating expenses, composed of research, development and technical, selling and marketing, and general and administrative expenses, were $32.5 million in the third fiscal quarter, which is consistent with comments provided by the company during its second quarter of fiscal 2008 earnings call on April 24. Operating expenses were $4.7 million higher than the $27.9 million reported in the same quarter a year ago, driven primarily by increased staffing related costs and higher professional fees, including costs to enforce the company�s intellectual property. Operating expenses were $0.4 million higher than the $32.2 million reported in the previous quarter, mostly due to increased staffing related costs and travel expenses, partially offset by lower professional fees. Net income of $10.0 million for the quarter was essentially even with the same quarter last year. The comparison to the prior year reflects higher revenue this quarter and the absence of a $2.1 million pre-tax investment write-off recorded last year, offset by increased operating expenses this year. Net income increased 25.7 percent from $7.9 million last quarter. Diluted earnings per share were $0.43 this quarter, up from both the $0.42 reported in the third quarter of fiscal 2007 and $0.34 in the previous quarter. Year to date, earnings per share were 28.8 percent higher than in the same period of fiscal 2007. �We are proud of our accomplishments this quarter, particularly the strong performance in our core CMP slurry business and the progress made toward optimizing our polishing pad manufacturing process,� stated William Noglows, Chairman and CEO of Cabot Microelectronics. �We believe that the execution of our key initiatives of Technology Leadership, Operations Excellence and Connecting with Customers, has allowed us to maintain our solid financial performance. Our strong year to date growth in both revenue and earnings demonstrates our ability to succeed across a range of economic and industry environments, and we look forward to building on this momentum going forward.� CONFERENCE CALL Cabot Microelectronics Corporation�s quarterly earnings conference call will be held today at 9:00 a.m. Central Time. The live conference call will be available via webcast from the company�s website, www.cabotcmp.com, or by phone at (866) 510-0712. Callers outside the U.S. can dial (617) 597-5380. The conference code for the call is 72609315. A replay will be available through August 21, 2008 via webcast at www.cabotcmp.com. A transcript of the formal comments made during the conference call will also be available in the Investor Relations section of the company�s website. ABOUT CABOT MICROELECTRONICS CORPORATION Cabot Microelectronics Corporation, headquartered in Aurora, Illinois, is the world's leading supplier of CMP slurries used in semiconductor and data storage manufacturing. 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. Since becoming an independent public company in 2000, the company has grown to approximately 800 employees on a global basis. The company's vision is to become the world leader in shaping, enabling and enhancing the performance of surfaces, so the company is leveraging its expertise in CMP slurry formulation, materials and polishing techniques developed for the semiconductor industry and applying it to demanding surface modification applications in other industries where shaping, enabling and enhancing the performance of surfaces is critical to success. For more information about Cabot Microelectronics Corporation, visit www.cabotcmp.com or contact Amy Ford, Director of Investor Relations at (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 or trends; growth of the markets in which the company participates; international events; product performance; the generation, protection and acquisition of intellectual property, and litigation related to such intellectual property; new product introductions; development of new products, technologies and markets; the acquisition of or investment in other entities; uses and investment of the company�s cash balance; and the construction of facilities by Cabot Microelectronics Corporation. 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 actual results to differ materially from those described by these forward-looking statements. In particular, see "Risk Factors" in the company�s quarterly report on Form 10-Q for the quarter ended March 31, 2008 and in the company�s annual report on Form 10-K for the fiscal year ended September 30, 2007, both filed with the SEC. Cabot Microelectronics 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 Nine Months Ended June 30, March 31, June 30, June 30, June 30, 2008 2008 2007 2008 2007 � Revenue $ 97,047 $ 94,488 $ 89,023 $ 284,913 $ 247,826 � Cost of goods sold � 51,638 � 52,212 � 46,552 � � 152,455 � 132,241 � Gross profit 45,409 42,276 42,471 132,458 115,585 � Operating expenses: � Research, development & technical 12,730 12,432 12,033 36,583 37,761 � Selling & marketing 7,176 6,907 6,469 20,367 17,792 � General & administrative � 12,642 � 12,856 � 9,387 � � 36,337 � 28,349 � Total operating expenses � 32,548 � 32,195 � 27,889 � � 93,287 � 83,902 � Operating income 12,861 10,081 14,582 39,171 31,683 � Other income (expense), net � 1,239 � 1,689 � (148 ) � 4,563 � 2,286 � Income before income taxes 14,100 11,770 14,434 43,734 33,969 � Provision for income taxes � 4,120 � 3,828 � 4,373 � � 13,613 � 10,292 � Net income $ 9,980 $ 7,942 $ 10,061 � $ 30,121 $ 23,677 � � Basic earnings per share $ 0.43 $ 0.34 $ 0.43 � $ 1.29 $ 1.00 � Weighted average basic shares outstanding � 23,132 � 23,402 � 23,662 � � 23,411 � 23,737 � � Diluted earnings per share $ 0.43 $ 0.34 $ 0.42 � $ 1.28 $ 1.00 � Weighted average diluted shares outstanding � 23,163 � 23,416 � 23,687 � � 23,441 � 23,741 � CABOT MICROELECTRONICS CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited and amounts in thousands) � � � June 30, September 30, 2008 2007 ASSETS: � Current assets: Cash, cash equivalents and short-term investments $ 203,941 $ 212,472 Accounts receivable, net 51,797 52,302 Inventories, net 46,217 37,266 Other current assets � 13,019 � 8,714 Total current assets 314,974 310,754 � Property, plant and equipment, net 119,091 118,454 Other long-term assets � 31,132 � 25,921 Total assets $ 465,197 $ 455,129 � � LIABILITIES AND STOCKHOLDERS' EQUITY: � Current liabilities: Accounts payable $ 13,768 $ 15,859 Capital lease obligations 1,111 1,066 Accrued expenses, income taxes payable and other current liabilities � 20,490 � 19,638 Total current liabilities 35,369 36,563 � Capital lease obligations 2,807 3,608 Other long-term liabilities � 2,419 � 1,754 Total liabilities 40,595 41,925 � Stockholders' equity � 424,602 � 413,204 Total liabilities and stockholders' equity $ 465,197 $ 455,129