AEIS Advanced Energy Industries Inc

FORT COLLINS, Colo., July 23 /PRNewswire-FirstCall/ -- Advanced Energy Industries, Inc. (NASDAQ:AEIS) today announced financial results for the second quarter ended June 30, 2008. Sales of $88.0 million were driven by a 36% sequential increase in sales to non-semiconductor markets, which reached 48% of our total sales. Sales to the solar market led the way, topping 14% of total sales for the quarter, while service revenues also hit a record high. Total second quarter sales declined 1% versus the first quarter of 2008, and declined 14.6% from $103.0 million in the second quarter of 2007, both due to the continued weakness in the semiconductor capital equipment market. Our book to bill ratio for the quarter was strong at 1.05:1. Gross margin for the second quarter was 40.1% versus 43.6% in the second quarter of 2007 due to lower sales and the related overhead absorption. Sequentially, gross margins were fractionally down from 40.3% in the first quarter of 2008. Net income for the second quarter of 2008 was $5.9 million, or $0.14 per diluted share, as cost reduction efforts controlled our operating expenses, compared to $11.7 million, or $0.25 per diluted share in the second quarter of 2007. Net income decreased sequentially from $6.0 million in the first quarter of 2008, but earnings per diluted share for the second quarter of 2008 were slightly higher due to shares repurchased during the quarter. "We executed on our diversification strategy, growing non-semiconductor revenue to record levels this quarter. Sales in each of our major non-semiconductor markets demonstrated strong growth, and demand for our products in the solar market reached its highest level yet," said Dr. Hans Betz, president and chief executive officer of Advanced Energy. "Further, we believe our ability to address these emerging markets will serve us well as we develop new applications for our technology and navigate through this cycle in the semiconductor market." Third Quarter 2008 Guidance The Company anticipates third quarter 2008 results to be within the following ranges: -- Sales of $82 million to $88 million. -- Earnings per share of $0.07 to $0.12 Second Quarter 2008 Conference Call Management will host a conference call today, Wednesday, July 23, 2008 at 5:00 pm Eastern Daylight Time to discuss Advanced Energy's financial results. Domestic callers may access this conference call by dialing 877-627-6511 and International callers may access the call by dialing 719-325-4916. Participants will need to provide the conference passcode 9067934. For a replay of this teleconference, please call 888-203-1112, or 719-457-0820 and enter the passcode 9067934. The replay will be available through 12:00 a.m. Eastern Daylight Time, July 25, 2008. 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 third quarter of 2008 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, particularly the semi-conductor industry, 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 INCOME (UNAUDITED) (in thousands, except per share data) Three Months Ended Six Months Ended June 30, March 31, June 30, 2008 2007 2008 2008 2007 Sales $87,996 $103,049 $88,887 $176,883 $210,372 Cost of sales 52,720 58,094 53,039 105,759 117,108 Gross profit 35,276 44,955 35,848 71,124 93,264 Operating expenses: Research and development 13,762 12,911 13,085 26,847 24,946 Selling, general and administrative 13,955 15,414 14,468 28,423 30,632 Amortization of intangible assets 226 202 240 466 526 Restructuring charges 393 158 674 1,067 2,950 Total operating expenses 28,336 28,685 28,467 56,803 59,054 Income from operations 6,940 16,270 7,381 14,321 34,210 Other income, net 996 1,505 905 1,901 3,059 Income from continuing operations before income taxes 7,936 17,775 8,286 16,222 37,269 Provision for income taxes (2,073) (6,108) (2,320) (4,393) (12,931) Net income $5,863 $11,667 $5,966 $11,829 $24,338 Basic earnings per share $0.14 $0.26 $0.13 $0.27 $0.54 Diluted earnings per share $0.14 $0.25 $0.13 $0.27 $0.53 Basic weighted-average common shares outstanding 41,869 45,161 44,662 43,265 45,051 Diluted weighted-average common shares outstanding 42,290 45,992 45,065 43,686 45,834 CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands) June 30, December 31, 2008 2007 ASSETS Current assets: Cash and cash equivalents $106,178 $94,588 Marketable securities 33,556 110,676 Accounts receivable, net 61,301 64,188 Inventories, net 48,431 50,532 Deferred income taxes 15,243 23,696 Other current assets 4,485 4,289 Total current assets 269,194 347,969 Property and equipment, net 30,434 30,912 Long-term investments 36,002 1,483 Deposits and other 5,831 5,562 Goodwill and intangibles, net 70,160 67,768 Customer service equipment, net 1,069 1,236 Deferred income tax assets, net 15,629 4,098 Total assets $428,319 $459,028 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Trade accounts payable $13,364 $12,424 Other accrued expenses 27,836 29,590 Total current liabilities 41,200 42,014 Long-term liabilities 9,611 9,953 Total liabilities 50,811 51,967 Stockholders' equity 377,508 407,061 Total liabilities and stockholders' equity $428,319 $459,028 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 Vanessa Lehr, +1-970-407-6555, , all of Advanced Energy Industries, Inc. Web site: http://www.advanced-energy.com/ http://ir.advanced-energy.com/

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