FORM FormFactor Inc

FormFactor, Inc. (Nasdaq:FORM) today announced its financial results for the first quarter of fiscal 2006. Quarterly revenues were a record $81.3 million, up 13% from $71.8 million in the fourth quarter of fiscal 2005, and up 60% from $50.9 million for the first quarter of fiscal 2005. "Following 34% revenue growth in 2005, we achieved record revenues based on solid operating performance as we successfully ramped our industry-leading MEMS facility," said Joseph Bronson, President of FormFactor. Net income for the first quarter of fiscal 2006 was $10.8 million or $0.25 per share on a fully diluted basis, which included $2.5 million or $0.05 of incremental FAS 123R stock option expense net of tax. This compares to $10.5 million or $0.25 per share on a fully diluted basis for the fourth quarter of fiscal year 2005, and $4.9 million or $0.12 per share on a fully diluted basis for the first quarter of fiscal year 2005, both of which exclude incremental stock-based compensation from the adoption of FAS 123R. The effective tax rate for the first quarter of fiscal 2006 was 35.9% compared to 29.1% for the fourth quarter of fiscal 2005 impacting net income by $1.1 million or $0.03 per fully diluted share. Bookings of $95.9 million for the first quarter of fiscal 2006 also set a company record, with an increase of 17% from $82.2 million for the fourth quarter of fiscal 2005 and an increase of 89% from $50.9 million for the first quarter of fiscal 2005. Cash, cash equivalents, restricted cash and marketable securities increased by $188 million to $402 million at the end of April 1, 2006 reflecting $182 million of net cash proceeds from our follow-on offering executed in March 2006 and $8.7 million of net cash proceeds from operations and other sources. "Growing demand for the Company's leading-edge advanced technology products continued this quarter. Our innovation continues to drive a strong product pipeline expanding our leadership position across multiple markets," said CEO Igor Khandros. The Company has posted its revenue breakdown by region and market segment on the Investors section of its website at www.formfactor.com. FormFactor will conduct a conference call at 1:30 p.m. PDT, or 4:30 p.m. EDT, today. The public is invited to listen to a live web cast of FormFactor's conference call on the Investor section of the Company's website at www.formfactor.com. An audio replay of the conference call will also be made available approximately two hours after the conclusion of the call. The audio replay will remain available until April 28, 2006 at 6:30 p.m. PDT and can be accessed by dialing (888) 286-8010 or (617) 801-6888 and entering confirmation code 80994195. About FormFactor: FormFactor, Inc. (Nasdaq:FORM) is an industry leader in the design, development, manufacture, sale and support of precision, high-performance advanced semiconductor wafer probe cards. The Company's products are based on its proprietary technologies, including its MicroSpring interconnect technology and design processes, which enable FormFactor to produce wafer probe cards for test applications that require reliability, speed, precision and signal integrity. FormFactor is headquartered in Livermore, California. For more information, visit the Company's website at www.formfactor.com. FormFactor and MicroSpring are registered trademarks of FormFactor, Inc. All other product, trademark, company or service names mentioned herein are the property of their respective owners. Statements in this press release that are not strictly historical in nature are forward-looking statements within the meaning of the federal securities laws, including statements regarding business momentum, operations, performance of our products and future growth. These forward-looking statements are based on current information and expectations that are inherently subject to change and involve a number of risks and uncertainties. Actual events or results might differ materially from those in any forward-looking statement due to various factors, including, but not limited to: the demand for certain semiconductor devices; the rate at which semiconductor manufacturers implement manufacturing capability changes, make the transition to smaller nanometer technology nodes and implement tooling cycles; the Company's ability to add manufacturing capacity, ramp production volume and expand globally; the Company's ability to develop and deliver innovative technologies, and to enforce its intellectual property rights; and the Company's ability to implement processes and structures to support growth. Additional information concerning factors that could cause actual events or results to differ materially from those in any forward-looking statement is contained in the Company's Form 10-K for the period ended December 31, 2005, filed with the Securities and Exchange Commission ("SEC"), and other SEC filings. Copies of SEC filings made by the Company are available at http://investors.formfactor.com/edgar.cfm. The Company assumes no obligation to update the information in this press release, to revise any forward-looking statements or to update the reasons actual results could differ materially from those anticipated in forward-looking statements. -0- *T FORMFACTOR, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended April 1, 2006 March 26, 2005 ------------------------------- (in thousands, except per share data) Revenues $ 81,330 $ 50,965 Cost of revenues 40,500 28,835 ------------------------------- Gross margin 40,830 22,130 ------------------------------- Operating expenses: Research and development 9,776 5,879 Selling, general and administrative 15,748 9,595 ------------------------------- Total operating expenses 25,524 15,474 ------------------------------- Operating income 15,306 6,656 Interest income 1,822 816 Other income (expense), net (341) 87 ------------------------------- 1,481 903 Income before income taxes 16,787 7,559 Provision for income taxes 6,019 2,648 ------------------------------- Net income $ 10,768 $ 4,911 =============================== Net income per share: Basic $ 0.26 $ 0.13 =============================== Diluted $ 0.25 $ 0.12 =============================== Weighted-average number of shares used in per share calculations: Basic 41,593 39,018 =============================== Diluted 43,473 41,197 =============================== FORMFACTOR, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data) (Unaudited) April 1, December 31, 2006 2005 ASSETS Current assets: Cash and cash equivalents $ 223,576 $ 31,217 Marketable securities 176,546 180,391 Accounts receivable, net of allowance for doubtful accounts of $74 as of April 1, 2006 and December 31, 2005 49,944 43,967 Inventories 21,098 18,404 Deferred tax assets 11,339 11,396 Prepaid expenses and other current assets 8,493 7,169 ------------------------- Total current assets 490,996 292,544 Restricted cash 2,250 2,250 Property and equipment, net 84,728 81,588 Deferred tax assets 5,521 4,518 Other assets 868 461 ------------------------- Total assets $ 584,363 $ 381,361 ========================= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 23,205 $ 26,369 Accrued liabilities 15,710 20,467 Income tax payable 12,544 9,697 Deferred rent 313 313 Deferred revenue and customer advances 4,562 3,588 ------------------------- Total current liabilities 56,334 60,434 Deferred rent and other long term liabilities 3,668 3,138 ------------------------- Total liabilities 60,002 63,572 ------------------------- Stockholders' equity Common stock, $0.001 par value 46 40 Additional paid in capital 461,915 268,291 Deferred stock-based compensation - (2,495) Accumulated other comprehensive loss (680) (359) Retained earnings 63,080 52,312 ------------------------- Total stockholders' equity 524,361 317,789 Total liabilities and stockholders' equity $ 584,363 $ 381,361 ========================= *T