- Annual Revenue Growth of 40 Percent
- Annual Gross Profit Margin of 49.9 Percent of
Revenue
- Annual Earnings Per Share of $2.13
- Strong Balance Sheet with $254 Million of Cash and No
Debt
Cabot Microelectronics Corporation (Nasdaq:CCMP), the world's
leading supplier of chemical mechanical planarization (CMP)
polishing slurries and growing CMP pad supplier to the
semiconductor industry, today reported financial results for its
fourth quarter and full fiscal year 2010, which ended September
30.
Total revenue during the fourth fiscal quarter was $110.3
million, which represents the company's fourth consecutive quarter
of record revenue. The company's fourth quarter revenue reflects an
increase of 14.3 percent compared to the same quarter last year and
an increase of 8.5 percent compared to the prior quarter, on
continued strong demand for the company's products. The company
achieved a gross profit margin of 48.7 percent of revenue in the
fourth fiscal quarter, diluted earnings per share of $0.66,
including approximately $0.09 associated with a lower quarterly
effective tax rate, and cash flow from operations of $21.1 million.
For the full fiscal year, total revenue was a record $408.2
million, which represents an increase of 40.1 percent compared to
fiscal year 2009, gross profit margin was 49.9 percent of revenue,
diluted earnings per share were a record $2.13 and cash flow from
operations was $88.4 million. The company's balance sheet
reflects a cash balance of $254.2 million and no debt outstanding
as of September 30, 2010.
"We are very pleased with our quarterly and full year results in
what has been a banner year for Cabot Microelectronics. Our
dedication to our strategic initiatives along with our commitment
to bolstering our global presence has allowed us to achieve record
revenue for the fourth consecutive quarter. With what we see as a
continued robust global industry environment, strong electronics
end-demand, and fab utilization reaching an all time high, we
believe we are well positioned for continued strong performance in
the near term. Over the longer term, we are optimistic that
ongoing capital additions by our customers and our robust pipeline
of new products will provide continued higher earnings potential
for the Company," said William Noglows, Chairman and CEO of Cabot
Microelectronics. "During the year, we achieved strong gross profit
margin performance and the best full year gross profit margin
results in six years, driven by solid utilization of our
manufacturing capacity, successful execution of productivity
initiatives and a disciplined pricing strategy, as well as
continued growth in our CMP pad business."
Mr. Noglows continued, "Our continued investment in the Asia
Pacific region supports our strategic priority to focus on this
important geographic area. In fiscal 2011, we plan to continue
to expand both our customer relationships and supply capabilities
in this region, as well as globally. Our goal is to continue
strengthening and growing our core CMP consumables business by
leveraging our CMP expertise and global infrastructure to better
serve our customers."
Key Financial Information
Total fourth fiscal quarter revenue of $110.3 million represents
a 14.3 percent increase from the $96.5 million reported in the same
quarter last year and an 8.5 percent increase from $101.7 million
in the prior quarter. The increase in revenue from the same
quarter last year primarily reflects increased demand for the
company's IC CMP slurry and polishing pad products. Compared
to the prior quarter, revenue increased across all business areas
and all geographic regions.
Total revenue for the full fiscal year was $408.2 million, which
represents a 40.1 percent increase from fiscal year
2009. Revenue for the company's CMP slurry products, CMP
polishing pads and engineered surface finishes business all
increased from the prior year.
Gross profit, expressed as a percentage of revenue, was 48.7
percent this quarter, compared to 48.4 percent in the same quarter
a year ago and 49.1 percent in the prior quarter. Compared to
the year ago quarter, gross profit percentage increased primarily
due to a higher valued product mix and increased utilization of the
company's manufacturing capacity, partially offset by higher fixed
costs and unfavorable foreign exchange effects. The decrease
in gross profit percentage versus the third fiscal quarter was
primarily due to the timing of unfavorable production related
variances and the impact of unfavorable foreign exchange effects,
largely offset by increased utilization of the company's
manufacturing capacity and a higher valued product mix.
Gross profit margin for the full fiscal year was 49.9 percent of
revenue, which is near the upper end of the company's guidance
range for full fiscal year 2010 of 46 to 50 percent of
revenue. Gross profit margin increased from 44.1 percent of
revenue in fiscal 2009 primarily due to higher sales volume and
increased utilization of the company's manufacturing capacity,
partially offset by higher fixed costs and unfavorable foreign
exchange effects.
Operating expenses, which include research, development and
technical, selling and marketing, and general and administrative
expenses, were $32.7 million in the fourth fiscal quarter,
representing a $4.7 million, or 16.8 percent, increase from $28.0
million in the same quarter a year ago. The increase was
driven primarily by higher variable incentive compensation costs,
as well as higher travel expenses and professional fees, including
costs to enforce the company's intellectual
property. Operating expenses were $1.8 million lower than the
$34.5 million reported in the previous quarter, mostly due to lower
professional fees, including costs to enforce the company's
intellectual property, and lower staffing related costs, partially
offset by higher travel expenses.
For the full year, total operating expenses were $129.5 million,
which represents a $17.1 million, or 15.2 percent, increase from
the $112.4 million reported in fiscal 2009. The increase was
driven primarily by higher variable incentive compensation expense,
higher professional fees, including costs to enforce the company's
intellectual property, and higher travel expenses. These cost
increases were partially offset by the absence of two specific
pre-tax expense items recorded in fiscal year 2009, including a
$1.4 million write off of in-process research and development
expense related to the company's acquisition of Epoch Material
Company and a $1.1 million impairment expense related to certain
research and development equipment, as well as a $0.9 million
decrease in bad debt expense.
Net income for the quarter was $15.3 million, up from $12.2
million in the same quarter last year and up from $10.1 million in
the prior quarter, mainly due to the higher level of
revenue. In addition, net income in the fourth fiscal quarter
benefited from a significantly lower effective tax rate based on
the company's assertion of permanent investment of a portion of its
foreign earnings outside of the U.S. Net income for the full
fiscal year was a record $49.5 million, up from $11.2 million in
fiscal 2009 on the higher level of revenue and gross profit
percentage, partially offset by higher operating
expenses.
Diluted earnings per share were $0.66 this quarter, including
approximately $0.09 associated with the lower quarterly effective
tax rate, up from $0.52 reported in the fourth quarter of fiscal
2009 and $0.43 reported in the previous quarter. Earnings per
share for full fiscal year 2010 were $2.13, which also includes the
$0.09 impact of the lower effective tax rate. Full year
earnings per share represent a record level for the company, and
are up over 300 percent from the $0.48 reported in the previous
fiscal year.
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)
783-2139. Callers outside the U.S. can dial (857)
350-1598. The conference code for the call is 58949572. A
replay will be available through November 26, 2010 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 polishing slurries
and growing CMP pad supplier to the semiconductor industry. The
company's products play a critical role in the production of
advanced semiconductor devices, enabling the manufacture of
smaller, faster and more complex devices by its customers. The
company's mission is to create value by developing reliable and
innovative solutions, through close customer collaboration, that
solve today's challenges and help enable tomorrow's
technology. Since becoming an independent public company in
2000, the company has grown to approximately 925 employees on a
global basis. For more information about Cabot
Microelectronics Corporation, visit www.cabotcmp.com or contact Amy
Ford, Director of Investor Relations at (630) 499-2600.
The Cabot Microelectronics Corporation logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=6902
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, contraction or trends; growth or contraction
of the markets in which the company participates; international
events or various economic factors; 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 June
30, 2010 and in the company's annual report on Form 10-K for the
fiscal year ended September 30, 2009, 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 |
Twelve Months Ended |
|
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
|
2010 |
2010 |
2009 |
2010 |
2009 |
|
|
|
|
|
|
Revenue |
$ 110,318 |
$ 101,655 |
$ 96,513 |
$ 408,201 |
$ 291,372 |
|
|
|
|
|
|
Cost of goods sold |
56,590 |
51,759 |
49,775 |
204,704 |
162,918 |
|
|
|
|
|
|
Gross profit |
53,728 |
49,896 |
46,738 |
203,497 |
128,454 |
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Research, development &
technical |
13,454 |
12,875 |
12,514 |
51,818 |
48,150 |
|
|
|
|
|
|
Selling & marketing |
7,024 |
7,009 |
5,798 |
26,885 |
22,239 |
|
|
|
|
|
|
General & administrative |
12,202 |
14,637 |
9,673 |
50,783 |
40,632 |
|
|
|
|
|
|
Purchased in-process research and
development |
-- |
-- |
-- |
-- |
1,410 |
|
|
|
|
|
|
Total operating expenses |
32,680 |
34,521 |
27,985 |
129,486 |
112,431 |
|
|
|
|
|
|
Operating income |
21,048 |
15,375 |
18,753 |
74,011 |
16,023 |
|
|
|
|
|
|
Other income (expense), net |
(527) |
172 |
(712) |
(734) |
599 |
|
|
|
|
|
|
Income before income taxes |
20,521 |
15,547 |
18,041 |
73,277 |
16,622 |
|
|
|
|
|
|
Provision for income taxes |
5,231 |
5,450 |
5,871 |
23,819 |
5,435 |
|
|
|
|
|
|
Net income |
$ 15,290 |
$ 10,097 |
$ 12,170 |
$ 49,458 |
$ 11,187 |
|
|
|
|
|
|
Basic earnings per share |
$0.67 |
$0.44 |
$0.53 |
$2.14 |
$0.48 |
|
|
|
|
|
|
Weighted average basic shares
outstanding |
22,821 |
23,143 |
23,137 |
23,084 |
23,079 |
|
|
|
|
|
|
Diluted earnings per share |
$0.66 |
$0.43 |
$0.52 |
$2.13 |
$0.48 |
|
|
|
|
|
|
Weighted average diluted shares
outstanding |
23,002 |
23,478 |
23,248 |
23,273 |
23,096 |
|
|
CABOT MICROELECTRONICS
CORPORATION |
CONSOLIDATED CONDENSED
BALANCE SHEETS |
(Unaudited and amounts in
thousands) |
|
|
September 30, |
September 30, |
|
2010 |
2009 |
ASSETS: |
|
|
|
|
|
Current assets: |
|
|
Cash, cash equivalents and short-term
investments |
$ 254,164 |
$ 199,952 |
Accounts receivable, net |
57,456 |
53,538 |
Inventories, net |
51,896 |
44,940 |
Other current assets |
17,513 |
18,422 |
Total current assets |
381,029 |
316,852 |
|
|
|
Property, plant and equipment, net |
115,811 |
122,782 |
Other long-term assets |
74,916 |
75,510 |
Total assets |
$ 571,756 |
$ 515,144 |
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY: |
|
|
|
|
|
Current liabilities: |
|
|
Accounts payable |
$ 17,521 |
$ 15,182 |
Capital lease obligations |
1,296 |
1,210 |
Accrued expenses and other current
liabilities |
34,513 |
23,144 |
Total current liabilities |
53,330 |
39,536 |
|
|
|
Capital lease obligations |
12 |
1,308 |
Other long-term liabilities |
4,071 |
3,571 |
Total liabilities |
57,413 |
44,415 |
|
|
|
Stockholders' equity |
514,343 |
470,729 |
Total liabilities and stockholders'
equity |
$ 571,756 |
$ 515,144 |
CONTACT: Cabot Microelectronics Corporation
Amy Ford, Director of Investor Relations
(630) 499-2600
www.cabotcmp.com
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