Revenue increases 11%, net income increases 42% over prior quarter;
FORT COLLINS, Colo., July 26 /PRNewswire-FirstCall/ -- Advanced
Energy Industries, Inc. (NASDAQ:AEIS) today announced financial
results for the second quarter ended June 30, 2006. (Logo:
http://www.newscom.com/cgi-bin/prnh/20030825/AEISLOGO) Sales were
$104.6 million for the second quarter of 2006, up 11.3% compared to
$94.0 million for the first quarter of 2006, and up 24.2% compared
to $84.2 million in the second quarter of 2005. Gross profit was
$44.8 million, or 42.8% of sales, in the second quarter of 2006,
compared to $38.6 million, or 41.0% of sales, in the first quarter
of 2006, and $30.6 million, or 36.4% of sales, in the second
quarter of 2005. Second quarter 2006 income from operations was
$19.2 million, or 18.4% of sales, an increase of 45.9% compared to
$13.2 million, or 14.0% of sales in the first quarter of 2006. This
compares to second quarter 2005 income from operations of $5.0
million, or 6.0% of sales. Second quarter 2005 income from
operations includes $1.1 million of restructuring charges. Second
quarter 2006 net income was $18.2 million, or $0.40 per diluted
share, up 42.3% compared to net income of $12.8 million, or $0.28
per diluted share in the first quarter of 2006, and $5.9 million,
or $0.18 per diluted share in the second quarter of 2005. Revenue
for the six months ended June 30, 2006 was $198.5 million compared
to $166.3 million for the first six months of 2005. Net income for
the first six months of 2006 was $30.9 million, or $0.69 per
diluted share, compared to $6.7 million, or $0.20 per diluted share
for the first six months of 2005. Dr. Hans Betz, president and
chief executive officer of Advanced Energy, said, "Sales to
semiconductor, flat panel display and architectural glass customers
drove much of the second quarter demand with double-digit
sequential growth in all three of these core markets. Unit sales of
our Pinnacle DC power conversion system, a long-time market leader
for a range of PVD applications in our core markets, reached an
all-time record level. The recent announcements of power system
orders from three solar panel manufacturers further demonstrate our
success in leveraging our product portfolio across core and
emerging market opportunities." Dr. Betz continued, "The results of
our second quarter exceeded our target financial performance. We
delivered 43 percent incremental operating margins for every
revenue dollar above $60 million. These are goals that we've been
driving toward for the past twelve months, and I thank Advanced
Energy's employees for their major contributions and successful
execution of these critical corporate objectives. We continue to
focus on further improving our financial performance and expanding
our market presence in profitable growth areas." Third Quarter 2006
Guidance The Company anticipates third quarter sales in the range
of $102 million to $106 million, and earnings per share in the
range of $0.34 to $0.37, assuming a 12% effective tax rate. Second
Quarter 2006 Conference Call Management will host a conference call
today, Wednesday, July 26, 2006 at 5:00 pm Eastern to discuss
Advanced Energy's financial results. You may access this conference
call by dialing 888-713-4717. International callers may access the
call by dialing 706-679-7720. For a replay of this teleconference,
please call 706-645-9291, and enter the pass code 2629324. The
replay will be available through August 2, 2006. There will also be
a webcast available on the Investor Relations webpage at
http://ir.advanced-energy.com/. About Advanced Energy Advanced
Energy is a global leader in the development and support of
technologies critical to high-technology, high-growth manufacturing
processes used in the production of semiconductors, flat panel
displays, data storage products, solar cells, architectural glass,
and other advanced product applications. Leveraging a diverse
product portfolio and technology leadership, Advanced Energy
creates solutions that maximize process impact, improve
productivity and lower the cost of ownership for its customers.
This portfolio includes a comprehensive line of technology
solutions in power, flow, thermal management, and plasma and ion
beam sources for original equipment manufacturers (OEMs) and
end-users around the world. Advanced Energy operates in regional
centers in North America, Asia and Europe and offers global sales
and support through direct offices, representatives and
distributors. Founded in 1981, Advanced Energy is a publicly held
company traded on the Nasdaq Global Market under the symbol AEIS.
For more information, please visit our corporate website:
http://www.advanced-energy.com/. This press release contains
certain forward-looking statements, including the company's
expectations with respect to Advanced Energy's financial results
for the third quarter of 2006 as well as other matters discussed in
this news release that are not purely historical data.
Forward-looking statements are subject to known and unknown risks
and uncertainties that could cause actual results to differ
materially from those expressed or implied by such statements. Such
risks and uncertainties include, but are not limited to: the
volatility and cyclicality of the industries we serve including the
semiconductor capital equipment and flat panel display industries,
the timing of orders received from our customers, our ability to
realize cost improvement benefits from the manufacturing
initiatives underway, and unanticipated changes to our effective
tax rate. These and other risks are described in Advanced Energy's
Form 10-K, Forms 10-Q and other reports and statements filed with
the Securities and Exchange Commission. These reports and
statements are available on the SEC's website at
http://www.sec.gov/ . Copies may also be obtained from Advanced
Energy's website at http://www.advanced-energy.com/ or by
contacting Advanced Energy's investor relations at 970-221-4670.
Forward-looking statements are made and based on information
available to us on the date of this press release. The company
assumes no obligation to update the information in this press
release. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) (in thousands, except per share data) Three Months
Ended Six Months Ended June 30, March 31, June 30, 2006 2005 2006
2006 2005 Sales $104,571 $84,163 $93,950 $198,521 $166,339 Cost of
sales 59,811 53,517 55,400 115,211 108,371 Gross profit 44,760
30,646 38,550 83,310 57,968 Operating expenses: Research and
development 10,804 10,220 10,459 21,263 20,475 Selling, general and
administrative 14,241 13,814 14,405 28,646 26,539 Amortization of
intangible assets 453 518 477 930 1,065 Restructuring charges 31
1,068 29 60 2,330 Total operating expenses 25,529 25,620 25,370
50,899 50,409 Income from operations 19,231 5,026 13,180 32,411
7,559 Other income (expense), net 741 (719) 1,833 2,574 (2,806)
Income from continuing operations before income taxes 19,972 4,307
15,013 34,985 4,753 Provision for income taxes (1,947) (1,430)
(2,252) (4,199) (1,959) Income from continuing operations 18,025
2,877 12,761 30,786 2,794 Gain on sale of discontinued assets 138
2,645 -- 138 2,645 Results of discontinued operations -- 427 -- --
1,244 Provision for income taxes -- -- -- -- -- Income from
discontinued operations 138 3,072 -- 138 3,889 Net income $18,163
$5,949 $12,761 $30,924 $6,683 Net income per basic share Income
from continuing operations $0.40 $0.09 $0.29 $0.69 $0.09 Income
from discontinued operations $0.00 $0.09 $-- $0.00 $0.12 Basic
earnings per share $0.41 $0.18 $0.29 $0.69 $0.20 Net income per
diluted share Income from continuing operations $0.40 $0.09 $0.28
$0.68 $0.08 Income from discontinued operations $0.00 $0.09 $-- $--
$0.12 Diluted earnings per share $0.40 $0.18 $0.28 $0.69 $0.20
Basic weighted-average common shares outstanding 44,704 32,797
44,571 44,638 32,776 Diluted weighted-average common shares
outstanding 45,108 33,094 45,004 45,098 32,986 CONDENSED
CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands) June 30,
December 31, 2006 2005 ASSETS Current assets: Cash and cash
equivalents $50,837 $52,874 Marketable securities 43,175 6,811
Accounts receivable, net 77,719 68,992 Inventories 59,822 56,199
Other current assets 4,170 6,773 Total current assets 235,723
191,649 Property and equipment, net 35,461 39,294 Deposits and
other 1,784 3,808 Goodwill and intangibles, net 69,360 69,843
Customer service equipment, net 1,632 2,407 Deferred income tax
assets, net 5,339 3,116 Total assets $349,299 $310,117 LIABILITIES
AND STOCKHOLDERS' EQUITY Current liabilities: Trade accounts
payable $22,283 $22,028 Other accrued expenses 26,975 23,977
Current portion of capital leases and senior borrowings 1,136 2,011
Total current liabilities 50,394 48,016 Long-term liabilities:
Capital leases and senior borrowings 1,982 2,179 Other long-term
liabilities 1,280 2,492 Total long-term liabilities 3,262 4,671
Total liabilities 53,656 52,687 Stockholders' equity 295,643
257,430 Total liabilities and stockholders' equity $349,299
$310,117 http://www.newscom.com/cgi-bin/prnh/20030825/AEISLOGO
http://photoarchive.ap.org/ DATASOURCE: Advanced Energy Industries,
Inc. CONTACT: Cathy Kawakami, Director, Investor Relations of
Advanced Energy Industries, Inc., +1-970-407-6732, Web site:
http://www.advanced-energy.com/ http://ir.advanced-energy.com/
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