AEIS Advanced Energy Industries Inc

Advanced Energy Reports First Quarter 2004 Results Returns to Profitability; Posts Net Income of $6.9 Million FORT COLLINS, Colo., April 15 /PRNewswire-FirstCall/ -- Advanced Energy Industries, Inc. today reported financial results for the first quarter ended March 31, 2004. Advanced Energy offers a comprehensive suite of process-centered solutions critical to the production of semiconductors, flat panel displays, data storage products, architectural glass and other advanced product applications. (Logo: http://www.newscom.com/cgi-bin/prnh/20030825/AEISLOGO) For the 2004 first quarter, revenues were $104.5 million, up 86 percent from $56.2 million for the first quarter of 2003, and up 40 percent compared to revenues of $74.7 million for the fourth quarter of 2003. Net income for the first quarter of 2004 was $6.9 million or $0.21 per diluted share, compared to a net loss of $8.6 million in the first quarter of 2003, or $0.27 per share. This compares to the fourth quarter 2003 net loss of $2.4 million, or $0.08 per share. Net income for the first quarter of 2004 includes approximately $1.0 million in pretax gains resulting from the sale of certain marketable securities and the sale of the Company's thermal control business. Doug Schatz, chairman and chief executive officer, said, "We experienced strong demand in all product groups, driven by continued momentum in the semiconductor capital equipment market and the market leading positions we have secured in high-growth semiconductor processing applications. This sales growth, coupled with the progress we've made to streamline our operating infrastructure, enabled us to achieve significant profitability in the first quarter. Our commitment to continued product innovation drives our ability to capture new opportunities and expand our market reach over a wide range of plasma-based processing applications. "Our decision to move out of the thermal control business is part of our continued focus on core competencies. The wafer chiller line is based on highly differentiated technology, and we are not willing to devote the resources required to meaningfully promote and support these products given our target long-term operating model for sustainable profitability throughout industry cycles. "Towards the end of the first quarter, we were seeing indications that order patterns are leveling out as the market absorbs the recent surge in capital equipment purchases. We anticipate second quarter revenue in the $107 million to $115 million range and an earnings per share range of $0.20 to $0.25. We continue to make progress in our transition to a more variable operating model, targeting sustainable, ongoing improvements to our incremental operating margin," said Mr. Schatz. First Quarter Conference Call Management will host a conference call today, Thursday, April 15, 2004 at 5:00 pm Eastern 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 706-645-9291, and enter the pass code 6231765. The replay will be available through Thursday, April 22, 2004. There will also be a webcast available at http://www.advanced-energy.com/ . About Advanced Energy Advanced Energy is a global leader in the development and support of technologies critical to high-technology manufacturing processes used in the production of semiconductors, flat panel displays, data storage products, compact discs, digital video discs, 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 National Market under the symbol AEIS. For more information, please visit our corporate website: http://www.advanced-energy.com/. Safe Harbor Statement This press release contains certain forward-looking statements, including the company's expectations with respect to Advanced Energy's financial results for the second quarter of 2004. 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 semiconductor and semiconductor capital equipment industries, Advanced Energy's ongoing ability to develop new products in a highly competitive industry characterized by increasingly rapid technological changes, Advanced Energy's ability to successfully integrate acquired companies' operations, and other risks described in Advanced Energy's Form 10-K, Forms 10-Q and other reports and statements, as 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 contacting Advanced Energy's investor relations at 970-221-4670. The company assumes no obligation to update the information in this press release. CONDENSED CONSOLIDATED INCOME STATEMENTS (UNAUDITED) (in thousands except per share data) Quarter Ended March 31, 2004 2003 Sales $104,487 $56,158 Cost of sales 66,073 38,208 Gross profit 38,414 17,950 Operating expenses: Research and development 13,410 13,367 Sales and marketing 8,037 8,330 General and administrative 5,767 4,529 Amortization of intangible assets 1,170 1,100 Restructuring charges 220 1,509 Total operating expenses 28,604 28,835 Income (loss) from operations 9,810 (10,885) Other (expense) income, net (1,155) (2,750) Income (loss) before income taxes 8,655 (13,635) (Provision) Benefit for income taxes (1,731) 5,045 Net Income (loss) $6,924 $(8,590) Basic net income (loss) per share: $0.21 $(0.27) Diluted net income (loss) per share: $0.21 $(0.27) Basic weighted-average common shares outstanding 32,581 32,159 Diluted weighted-average common shares outstanding 33,593 32,159 CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands) March 31, December 31, 2004 2003 ASSETS Current Assets: Cash and cash equivalents $43,996 $41,522 Marketable securities 84,045 93,691 Accounts receivable 79,013 61,927 Income tax receivable 465 151 Inventories 72,148 65,703 Other current assets 3,827 5,486 Total current assets 283,494 268,480 Property and equipment, net 45,273 44,725 Deposits and other 6,306 5,630 Goodwill and intangibles, net 86,529 88,943 Demonstration and customer service equipment, net 4,266 3,934 Deferred debt issuance costs, net 2,765 3,019 Total assets $428,633 $414,731 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Trade accounts payable $33,072 $23,066 Other current liabilities 26,046 28,216 Current portion of capital leases and senior borrowings 8,239 8,582 Accrued interest payable on convertible subordinated notes 1,810 2,460 Total current liabilities 69,167 62,324 Long-term Liabilities: Capital leases and senior borrowings 4,935 6,168 Deferred income tax liability, net 4,787 4,672 Convertible subordinated notes payable 187,718 187,718 Other long-term liabilities 2,095 2,015 Total long-term liabilities 199,535 200,573 Total liabilities 268,702 262,897 Stockholders' equity 159,931 151,834 Total liabilities and stockholders' equity $428,633 $414,731 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) Three Months Ended March 31, 2004 2003 NET CASH USED IN OPERATING ACTIVITIES $(4,344) $(4,579) NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 8,003 (5,460) NET CASH USED IN FINANCING ACTIVITIES (1,588) (1,981) EFFECT OF CURRENCY TRANSLATION ON CASH 403 134 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 2,474 (11,886) CASH AND EQUIVALENTS, beginning of period 41,522 70,188 CASH AND EQUIVALENTS, end of period $43,996 $58,302 http://www.newscom.com/cgi-bin/prnh/20030825/AEISLOGO http://photoarchive.ap.org/ DATASOURCE: Advanced Energy Industries, Inc. CONTACT: Mike El-Hillow, Executive Vice President and Chief Financial Officer, +1-970-407-6570, , or Cathy Kawakami, Director of Investor Relations, +1-970-407-6732, , both of Advanced Energy Industries, Inc. Web site: http://www.advanced-energy.com/

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