FORT COLLINS, Colo., Oct. 24 /PRNewswire-FirstCall/ -- Advanced
Energy Industries, Inc. (NASDAQ:AEIS) today announced financial
results for the third quarter ended September 30, 2007. Sales were
$90.5 million for the third quarter of 2007, consistent with the
Company's revised guidance given on August 30, 2007. This
represented a decrease of 16.0% from $107.7 million in the third
quarter of 2006, and a sequential decline of 12.1% compared to
$103.0 million in the second quarter of 2007. Gross margin for the
third quarter was 40.6%, down from 43.7% in the third quarter of
2006, and down from 43.6% in the second quarter of 2007. This was
primarily due to lower revenues, an additional charge of $2.2
million to cost of goods sold, and costs related to the transition
of manufacturing from Stolberg, Germany to China. The additional
charges were related to a change in the estimate of warranty
expense for two products, which resulted in a 2.4% reduction in
gross margin. The company also incurred a net charge of $1.4
million related to a foreign exchange loss during the quarter, as
the Yen and Euro strengthened relative to the US dollar. Net income
for the third quarter of 2007 was $5.9 million, or $0.13 per
diluted share, compared to $17.0 million, or $0.38 per diluted
share in the third quarter of 2006, and $11.7 million or $0.25 in
the second quarter of 2007. "Our revenue was in line with our pre
announcement due to the weakness in the semiconductor equipment
market. The gross margin did not meet our objective due to the
increased warranty expense. In the near term we expect to see
continued softness in the semiconductor equipment and flat panel
display markets with modest growth in our other markets," said Dr.
Hans Betz, president and chief executive officer of Advanced
Energy. "We made additional progress in the strategic
diversification of our business notably with the successful
introduction of our Solaron(TM) inverter product line." Fourth
Quarter 2007 Guidance The Company anticipates fourth quarter 2007
results to be within the following ranges: -- Sales of $86 million
to $90 million. -- Earnings per share of $0.12 to $0.14 Third
Quarter 2007 Conference Call Management will host a conference call
today, Wednesday, October 24, 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)-634-7937. Participants will
need to provide a conference passcode 20284265. For a replay of
this teleconference, please call (800)-642-1687 or (706) 645-9291,
and enter the passcode 20284265. The replay will be available
through October 27, 2007. A webcast will also be available on the
Investor Relations webpage at http://ir.advanced-energy.com/. About
Advanced Energy Advanced Energy(R) develops innovative power and
control technologies that enable high-growth, plasma thin-film
manufacturing processes worldwide, including semiconductors, flat
panel displays, data storage products, solar cells, architectural
glass, and other advanced product applications. Advanced Energy(R)
also develops grid connect inverters for the solar energy market.
The Company's expectations with respect to financial results for
the fourth 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, the company's dependence on sole and limited source
suppliers, fluctuating currency rates, 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 Nine Months Ended September 30, June 30, September 30, 2007
2006 2007 2007 2006 Sales $90,492 $107,688 $103,049 $300,863
$306,209 Cost of sales 53,765 60,674 58,094 170,873 175,885 Gross
profit 36,727 47,014 44,955 129,990 130,324 Operating expenses:
Research and development 12,937 11,345 12,911 37,883 32,608
Selling, general and administrative 15,537 16,856 15,414 46,169
45,502 Amortization of intangible assets 201 453 202 727 1,383
Restructuring charges 556 31 158 3,505 91 Total operating expenses
29,231 28,685 28,685 88,284 79,584 Income from operations 7,496
18,329 16,270 41,706 50,740 Other income, net 308 1,044 1,505 3,367
3,617 Income from continuing operations before income taxes 7,804
19,373 17,775 45,073 54,357 Provision for income taxes (1,948)
(2,381) (6,108) (14,879) (6,580) Income from continuing operations
5,856 16,992 11,667 30,194 47,777 Gain on sale of discontinued
assets - - - - 138 Income from discontinued operations - - - - 138
Net income $5,856 $16,992 $11,667 $30,194 $47,915 Net income per
basic share Income from continuing operations $0.13 $0.38 $0.26
$0.67 $1.07 Income from discontinued operations $- $- $- $- $0.00
Basic earnings per share $0.13 $0.38 $0.26 $0.67 $1.07 Net income
per diluted share Income from continuing operations $0.13 $0.38
$0.25 $0.66 $1.06 Income from discontinued operations $- $- $- $-
$0.00 Diluted earnings per share $0.13 $0.38 $0.25 $0.66 $1.06
Basic weighted-average common shares outstanding 45,248 44,762
45,161 45,117 44,679 Diluted weighted-average common shares
outstanding 45,761 45,166 45,992 45,696 45,168 CONDENSED
CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands) September
30, December 31, 2007 2006 ASSETS Current assets: Cash and cash
equivalents $76,878 $58,240 Marketable securities 108,154 85,978
Accounts receivable, net 69,704 74,794 Inventories, net 57,388
52,778 Deferred income taxes 21,740 24,434 Assets held for sale
1,345 - Other current assets 5,877 4,503 Total current assets
341,086 300,727 Property and equipment, net 30,677 33,571 Deposits
and other 8,296 2,640 Goodwill and intangibles, net 67,013 65,584
Customer service equipment, net 939 832 Deferred income tax assets,
net 4,222 8,549 Total assets $452,233 $411,903 LIABILITIES AND
STOCKHOLDERS' EQUITY Current liabilities: Trade accounts payable
$15,578 $16,310 Other accrued expenses 28,488 36,619 Total current
liabilities 44,066 52,929 Long-term liabilities 9,851 3,184 Total
liabilities 53,917 56,113 Stockholders' equity 398,316 355,790
Total liabilities and stockholders' equity $452,233 $411,903
http://www.newscom.com/cgi-bin/prnh/20030825/AEISLOGO
http://photoarchive.ap.org/ DATASOURCE: Advanced Energy Industries,
Inc. CONTACT: Lawrence D. Firestone, +1-970-407-6570, , or Annie
Leschin or Brooke Deterline, +1-970-407-6555, , all of Advanced
Energy Industries, Inc. Web site: http://www.advanced-energy.com/
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