FORT COLLINS, Colo., July 25 /PRNewswire-FirstCall/ -- Advanced
Energy Industries, Inc. (NASDAQ:AEIS) today announced financial
results for the second quarter ended June 30, 2007. Sales were
$103.0 million for the second quarter of 2007, a decrease of 1.5%
from $104.6 million in the second quarter of 2006, and a sequential
decline of 4.0% compared to $107.3 million in the first quarter of
2007. Gross margin for the second quarter was 43.6%, up from 42.8%
in the second quarter of 2006, and down from 45.0% in the first
quarter of 2007 due to lower revenues, and the transition of
manufacturing from Stolberg, Germany to China. Net income for the
second quarter of 2007 was $11.7 million, or $0.25 per diluted
share, a 35.7% decrease compared to $18.2 million, or $0.40 per
diluted share in the second quarter of 2006. This was primarily due
to an increase in research and development spending and the change
in the effective tax rate from 11% in 2006 to 35% in 2007. Net
income also decreased 8.0% from $12.7 million, or $0.28 in the
first quarter of 2007, due to lower revenues. The first quarter of
2007 included a restructuring charge of $2.8 million related to the
closure of the Company's Stolberg, Germany facility. "Second
quarter revenues came in at the low end of our guidance as we began
to experience the impacts of a decline in our business as demand
from the semiconductor capital equipment industry was lower than
previously anticipated. As a result, earnings came in lower than
expected and gross margins were lower due to the costs associated
with the transition of production from Stolberg, Germany to China,
which will be complete by the end of the year. We increased our
R&D spending in the quarter which was driven by several
strategic initiatives that are in process. However, we experienced
strong growth from our non-semi business, which was up 11%
sequentially, and dampened the effect of the down semi revenues for
the quarter," said Dr. Hans Betz, president and chief executive
officer of Advanced Energy. "As we look ahead, we remain highly
confident in our growth strategy, including our current product
pipeline, our excellent position in our markets and our future
growth opportunities." Third Quarter 2007 Guidance The Company
anticipates third quarter 2007 results to be within the following
ranges: -- Sales of $95 million to $100 million. -- Earnings per
share of $0.19 to $0.22. Second Quarter 2007 Conference Call
Management will host a conference call today, Wednesday, July 25,
2007 at 5:00 pm eastern daylight time 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 (800)-642-1687 or (706) 645-9291, and enter the passcode
7322751. The replay will be available through July 27, 2007. 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 thin film deposition manufacturing
processes used in the production of semiconductors, flat panel
displays, data storage products, solar cells, architectural glass,
and other advanced product applications. 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/. The Company's
expectations with respect to financial results for the third
quarter of 2007 are forward looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. 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 the company serves, the timing of orders received from
customers, the company's ability to realize cost improvement
benefits from the global operations initiatives underway, and
unanticipated changes to management's estimates, reserves or
allowances. 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 970-407-6555.
Forward- looking statements are made and based on information
available to the company 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, 2007 2006 2007
2007 2006 Sales $103,049 $104,571 $107,323 $210,372 $198,521 Cost
of sales 58,094 59,811 59,014 117,108 115,211 Gross profit 44,955
44,760 48,309 93,264 83,310 Operating expenses: Research and
development 12,911 10,804 12,035 24,946 21,263 Selling, general and
administrative 15,414 14,241 15,218 30,632 28,646 Amortization of
intangible assets 202 453 324 526 930 Restructuring charges 158 31
2,792 2,950 60 Total operating expenses 28,685 25,529 30,369 59,054
50,899 Income from operations 16,270 19,231 17,940 34,210 32,411
Other income, net 1,505 741 1,554 3,059 2,574 Income from
continuing operations before income taxes 17,775 19,972 19,494
37,269 34,985 Provision for income taxes (6,108) (1,947) (6,823)
(12,931) (4,199) Income from continuing operations 11,667 18,025
12,671 24,338 30,786 Gain on sale of discontinued assets - 138 - -
138 Income from discontinued operations - 138 - - 138 Net income
$11,667 $18,163 $12,671 $24,338 $30,924 Net income per basic share
Income from continuing operations $0.26 $0.40 $0.28 $0.54 $0.69
Income from discontinued operations $- $- $- $- $- Basic earnings
per share $0.26 $0.41 $0.28 $0.54 $0.69 Net income per diluted
share Income from continuing operations $0.25 $0.40 $0.28 $0.53
$0.68 Income from discontinued operations $- $- $- $- $- Diluted
earnings per share $0.25 $0.40 $0.28 $0.53 $0.69 Basic
weighted-average common shares outstanding 45,161 44,704 44,941
45,051 44,638 Diluted weighted-average common shares outstanding
45,992 45,108 45,636 45,834 45,098 CONDENSED CONSOLIDATED BALANCE
SHEETS (UNAUDITED) (in thousands) June 30, December 31, 2007 2006
ASSETS Current assets: Cash and cash equivalents $73,080 $58,240
Marketable securities 105,407 85,978 Accounts receivable, net
73,491 74,794 Inventories, net 56,896 52,778 Deferred income taxes
22,692 24,434 Other current assets 4,463 4,503 Total current assets
336,029 300,727 Property and equipment, net 30,659 33,571 Deposits
and other 8,105 2,640 Goodwill and intangibles, net 64,404 65,584
Customer service equipment, net 617 832 Deferred income tax assets,
net 3,897 8,549 Total assets $443,711 $411,903 LIABILITIES AND
STOCKHOLDERS' EQUITY Current liabilities: Trade accounts payable
$16,656 $16,310 Other accrued expenses 34,324 36,619 Total current
liabilities 50,980 52,929 Long-term liabilities 9,643 3,184 Total
liabilities 60,623 56,113 Stockholders' equity 383,088 355,790
Total liabilities and stockholders' equity $443,711 $411,903
http://www.newscom.com/cgi-bin/prnh/20030825/AEISLOGO
http://photoarchive.ap.org/ DATASOURCE: Advanced Energy Industries,
Inc. CONTACT: Annie Leschin or Brooke Deterline, both of
StreetSmart Investor Relations, +1-415-775-1788, , for Advanced
Energy Industries, Inc. Web site: http://www.advanced-energy.com/
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