MILPITAS, Calif.,
April 23, 2015 /PRNewswire/ -- KLA-Tencor Corporation
(NASDAQ: KLAC) today announced operating results for its third
quarter of fiscal year 2015, which ended on March 31, 2015,
and reported GAAP net income of $132
million and GAAP earnings per diluted share of $0.81 on revenues of $738
million.
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"KLA-Tencor delivered solid results in the third quarter," said
Rick Wallace, President and Chief
Executive Officer of KLA-Tencor. "As the market leader in process
control, we believe our technology leadership and strong product
portfolio create a unique opportunity for KLA-Tencor to benefit
from the 3D device and multi-patterning industry transitions
currently underway in the industry, and deliver long-term value for
our customers and stockholders."
GAAP
Results
|
|
Q3 FY
2015
|
Q2 FY
2015
|
Q3 FY
2014
|
Revenues
|
$738 million
|
$676 million
|
$832 million
|
Net Income
|
$132 million
|
$20 million
|
$204 million
|
Earnings per Diluted
Share
|
$0.81
|
$0.12
|
$1.21
|
|
|
|
|
Non-GAAP
Results
|
|
Q3 FY
2015
|
Q2 FY
2015
|
Q3 FY
2014
|
Net Income
|
$137 million
|
$113 million
|
$206 million
|
Earnings per Diluted
Share
|
$0.84
|
$0.68
|
$1.23
|
KLA-Tencor also announced a plan to reduce its global employee
workforce by up to 10 percent to streamline its organization and
business processes in response to changing customer requirements in
its industry. The goal of this reduction is to enable continued
innovation and direct KLA-Tencor's resources toward its best
opportunities. KLA-Tencor expects to substantially complete the
employee reduction by the end of the first quarter of fiscal year
2016, but the timing of certain employee reductions may vary by
country, based on local legal requirements.
A reconciliation between GAAP operating results and non-GAAP
operating results is provided following the financial statements
that are part of this release. Non-GAAP results include the impact
of stock-based compensation, but exclude the impact of
acquisitions, restructuring, severance and other charges and debt
extinguishment loss and recapitalization charges. KLA-Tencor will
discuss the results for its fiscal year 2015 third quarter, along
with its outlook, on a conference call today beginning at
2:00 p.m. Pacific Daylight Time. A
webcast of the call will be available at:
www.kla-tencor.com.
Forward-Looking Statements: Statements in this press
release other than historical facts, such as statements regarding
KLA-Tencor's ability to benefit from its market leadership
position, the anticipated size of KLA-Tencor's global employee
workforce reduction and the expected timing of the completion of
such employee reduction, are forward-looking statements, and are
subject to the Safe Harbor provisions created by the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements are based on current information and expectations, and
involve a number of risks and uncertainties. Actual results may
differ materially from those projected in such statements due to
various factors, including but not limited to: the demand for
semiconductors; the financial condition of the global capital
markets and the general macroeconomic environment; new and enhanced
product and technology offerings by competitors; cancellation of
orders by customers; the ability of KLA-Tencor's research and
development teams to successfully innovate and develop technologies
and products that are responsive to customer demands; KLA-Tencor's
ability to successfully manage its costs; market acceptance of
KLA-Tencor's existing and newly issued products; changing customer
demands; industry transitions; the costs and delays related to
compliance with U.S. and international labor laws and other
applicable laws, including the notification procedures required
thereby; and the disruption resulting from the employee reduction
and its potential impact on KLA-Tencor's relationships with
customers and vendors. For other factors that may cause actual
results to differ materially from those projected and anticipated
in forward-looking statements in this release, please refer to
KLA-Tencor's Annual Report on Form 10-K for the year ended
June 30, 2014, subsequently filed Quarterly Reports on Form
10-Q and other filings with the Securities and Exchange Commission
(including, but not limited to, the risk factors described
therein). KLA-Tencor assumes no obligation to, and does not
currently intend to, update these forward-looking statements.
About KLA-Tencor:
KLA-Tencor Corporation (NASDAQ:
KLAC), a leading provider of process control and yield management
solutions, partners with customers around the world to develop
state-of-the-art inspection and metrology technologies. These
technologies serve the semiconductor, LED and other related
nanoelectronics industries. With a portfolio of
industry-standard products and a team of world-class engineers and
scientists, the company has created superior solutions for its
customers for more than 35 years. Headquartered in Milpitas, California, KLA-Tencor has dedicated
customer operations and service centers around the world.
Additional information may be found at www.kla-tencor.com.
(KLAC-F)
Use of Non-GAAP Financial Information:
The non-GAAP and supplemental information provided in this press
release is a supplement to, and not a substitute for, KLA-Tencor's
financial results presented in accordance with United States
GAAP.
To supplement KLA-Tencor's condensed consolidated financial
statements presented in accordance with GAAP, the company provides
certain non-GAAP financial information, which is adjusted from
results based on GAAP to exclude certain costs and expenses, as
well as other supplemental information. The non-GAAP and
supplemental information is provided to enhance the user's overall
understanding of KLA-Tencor's operating performance and its
prospects in the future. Specifically, KLA-Tencor believes that the
non-GAAP information provides useful measures to both management
and investors regarding financial and business trends relating to
KLA-Tencor's financial performance by excluding certain costs and
expenses that the company believes are not indicative of its core
operating results. The non-GAAP information is among the budgeting
and planning tools that management uses for future forecasting.
However, because there are no standardized or generally accepted
definitions for most non-GAAP financial metrics, definitions of
non-GAAP financial metrics (for example, determining which costs
and expenses to exclude when calculating such a metric) are
inherently subject to significant discretion. As a result, non-GAAP
financial metrics may be defined very differently from company to
company, or even from period to period within the same company,
which can potentially limit the usefulness of such information to
an investor. The presentation of non-GAAP and supplemental
information is not meant to be considered in isolation or as a
substitute for results prepared and presented in accordance with
United States GAAP.
KLA-Tencor
Corporation
|
|
|
|
Condensed
Consolidated Unaudited Balance Sheets
|
|
|
|
|
|
|
|
(In
thousands)
|
March 31,
2015
|
|
June 30,
2014
|
ASSETS
|
|
|
|
Cash,
cash equivalents and marketable securities
|
$
|
2,339,785
|
|
|
$
|
3,152,637
|
Accounts
receivable, net
|
631,608
|
|
|
492,863
|
Inventories
|
632,353
|
|
|
656,457
|
Other
current assets
|
363,365
|
|
|
284,873
|
Land,
property and equipment, net
|
321,081
|
|
|
330,263
|
Goodwill
|
335,291
|
|
|
335,355
|
Purchased intangibles, net
|
15,548
|
|
|
27,697
|
Other
non-current assets
|
263,189
|
|
|
258,519
|
Total
assets
|
$
|
4,902,220
|
|
|
$
|
5,538,664
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
103,189
|
|
|
$
|
103,422
|
Deferred
system profit
|
146,355
|
|
|
147,923
|
Unearned
revenue
|
58,295
|
|
|
59,176
|
Current
portion of long-term debt
|
37,500
|
|
|
—
|
Other
current liabilities
|
631,276
|
|
|
585,090
|
Total
current liabilities
|
976,615
|
|
|
895,611
|
Non-current
liabilities:
|
|
|
|
Long-term debt
|
3,199,299
|
|
|
747,919
|
Unearned
revenue
|
52,500
|
|
|
57,500
|
Other
non-current liabilities
|
179,865
|
|
|
168,288
|
Total
liabilities
|
4,408,279
|
|
|
1,869,318
|
Stockholders'
equity:
|
|
|
|
Common
stock and capital in excess of par value
|
534,330
|
|
|
1,220,504
|
Retained
earnings
|
(2,582)
|
|
|
2,479,113
|
Accumulated other comprehensive income (loss)
|
(37,807)
|
|
|
(30,271)
|
Total
stockholders' equity
|
493,941
|
|
|
3,669,346
|
Total
liabilities and stockholders' equity
|
$
|
4,902,220
|
|
|
$
|
5,538,664
|
KLA-Tencor
Corporation
|
|
|
|
|
|
|
Condensed
Consolidated Unaudited Statements of Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
March 31,
|
|
Nine months ended
March 31,
|
(In thousands,
except per share amounts)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Revenues:
|
|
|
|
|
|
|
|
Product
|
$
|
565,181
|
|
|
$
|
670,083
|
|
|
$
|
1,545,663
|
|
|
$
|
1,716,006
|
Service
|
173,278
|
|
|
161,516
|
|
|
512,054
|
|
|
479,059
|
Total
revenues
|
738,459
|
|
|
831,599
|
|
|
2,057,717
|
|
|
2,195,065
|
Costs and operating
expenses:
|
|
|
|
|
|
|
|
Costs of
revenues
|
320,282
|
|
|
342,826
|
|
|
891,962
|
|
|
906,297
|
Engineering, research
and development
|
124,583
|
|
|
134,161
|
|
|
401,777
|
|
|
401,021
|
Selling, general and
administrative
|
98,608
|
|
|
93,449
|
|
|
305,125
|
|
|
288,691
|
Total costs and
operating expenses
|
543,473
|
|
|
570,436
|
|
|
1,598,864
|
|
|
1,596,009
|
Income from
operations
|
194,986
|
|
|
261,163
|
|
|
458,853
|
|
|
599,056
|
Interest expense and
other, net
|
28,532
|
|
|
9,917
|
|
|
67,991
|
|
|
31,201
|
Loss on
extinguishment of debt and other, net
|
—
|
|
|
—
|
|
|
131,669
|
|
|
—
|
Income before income
taxes
|
166,454
|
|
|
251,246
|
|
|
259,193
|
|
|
567,855
|
Provision for income
taxes
|
34,816
|
|
|
47,665
|
|
|
35,054
|
|
|
113,831
|
Net income
|
$
|
131,638
|
|
|
$
|
203,581
|
|
|
$
|
224,139
|
|
|
$
|
454,024
|
Net income per
share:
|
|
|
|
|
|
|
|
Basic
|
$
|
0.81
|
|
|
$
|
1.22
|
|
|
$
|
1.37
|
|
|
$
|
2.73
|
Diluted
|
$
|
0.81
|
|
|
$
|
1.21
|
|
|
$
|
1.36
|
|
|
$
|
2.70
|
Cash dividends
declared per share (including a special cash dividend of $16.50 per share declared during
the three months ended
December 31, 2014)
|
$
|
0.50
|
|
|
$
|
0.45
|
|
|
$
|
18.00
|
|
|
$
|
1.35
|
Weighted-average
number of shares:
|
|
|
|
|
|
|
|
Basic
|
161,559
|
|
|
166,253
|
|
|
163,494
|
|
|
166,184
|
Diluted
|
162,794
|
|
|
167,989
|
|
|
164,930
|
|
|
168,355
|
KLA-Tencor
Corporation
Condensed
Consolidated Unaudited Statements of Cash Flows
|
|
|
|
|
Three months
ended
|
March
31,
|
(In
thousands)
|
2015
|
|
2014
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
131,638
|
|
|
$
|
203,581
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
20,510
|
|
|
20,614
|
Asset impairment
charges
|
1,698
|
|
|
—
|
Non-cash stock-based
compensation expense
|
12,767
|
|
|
12,723
|
Excess tax benefit
from equity awards
|
(398)
|
|
|
(657)
|
Net gain on sale of
marketable securities and other investments
|
(60)
|
|
|
(281)
|
Changes in assets and
liabilities, net of impact of acquisition of business:
|
|
|
|
Decrease (increase)
in accounts receivable, net
|
(1,213)
|
|
|
16,598
|
Decrease (increase)
in inventories
|
23,745
|
|
|
(14,738)
|
Decrease in other
assets
|
20,096
|
|
|
48,463
|
Decrease in accounts
payable
|
(5,054)
|
|
|
(20,818)
|
Decrease in deferred
system profit
|
(21,732)
|
|
|
(70,008)
|
Increase in other
liabilities
|
60,420
|
|
|
42,250
|
Net cash provided by
operating activities
|
242,417
|
|
|
237,727
|
Cash flows from
investing activities:
|
|
|
|
Acquisition of
non-marketable securities
|
—
|
|
|
(1,345)
|
Acquisition of
business
|
—
|
|
|
(18,000)
|
Capital expenditures,
net
|
(10,326)
|
|
|
(18,220)
|
Purchase of
available-for-sale securities
|
(339,580)
|
|
|
(359,299)
|
Proceeds from sale of
available-for-sale securities
|
223,438
|
|
|
202,650
|
Proceeds from
maturity of available-for-sale securities
|
181,151
|
|
|
60,035
|
Purchase of trading
securities
|
(9,383)
|
|
|
(20,939)
|
Proceeds from sale of
trading securities
|
13,765
|
|
|
22,521
|
Net cash provided by
(used in) investing activities
|
59,065
|
|
|
(132,597)
|
Cash flows from
financing activities:
|
|
|
|
Repayment of
debt
|
(9,375)
|
|
|
—
|
Issuance of common
stock
|
175
|
|
|
13,334
|
Tax withholding
payments related to vested and released restricted stock
units
|
(1,990)
|
|
|
(2,347)
|
Common stock
repurchases
|
(168,670)
|
|
|
(59,880)
|
Payment of dividends
to stockholders
|
(82,250)
|
|
|
(74,805)
|
Excess tax benefit
from equity awards
|
398
|
|
|
657
|
Net cash used in
financing activities
|
(261,712)
|
|
|
(123,041)
|
Effect of exchange
rate changes on cash and cash equivalents
|
(2,743)
|
|
|
752
|
Net increase
(decrease) in cash and cash equivalents
|
37,027
|
|
|
(17,159)
|
Cash and cash
equivalents at beginning of period
|
584,865
|
|
|
793,382
|
Cash and cash
equivalents at end of period
|
$
|
621,892
|
|
|
$
|
776,223
|
Supplemental cash
flow disclosures:
|
|
|
|
Income taxes paid,
net
|
$
|
8,101
|
|
|
$
|
9,636
|
Interest
paid
|
$
|
4,341
|
|
|
$
|
135
|
Non-cash
activities:
|
|
|
|
Purchase of land,
property and equipment - investing activities
|
$
|
2,255
|
|
|
$
|
4,103
|
Dividends payable -
financing activities
|
$
|
41,412
|
|
|
$
|
—
|
KLA-Tencor
Corporation
Condensed
Consolidated Unaudited Supplemental Information
(In thousands,
except per share amounts)
|
|
|
|
|
|
|
Reconciliation of
GAAP Net Income to Non-GAAP Net Income
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
March 31,
2015
|
|
December 31,
2014
|
|
March 31,
2014
|
|
March 31,
2015
|
|
March 31,
2014
|
GAAP net
income
|
|
$
|
131,638
|
|
|
$
|
20,268
|
|
|
$
|
203,581
|
|
|
$
|
224,139
|
|
|
$
|
454,024
|
Adjustments to
reconcile GAAP net income to non-GAAP net income
|
|
|
|
|
|
|
|
|
|
|
Acquisition related
charges
|
a
|
3,928
|
|
|
3,832
|
|
|
3,828
|
|
|
11,758
|
|
|
11,596
|
Restructuring,
severance and other related charges
|
b
|
3,636
|
|
|
3,299
|
|
|
—
|
|
|
10,992
|
|
|
3,239
|
Debt extinguishment
loss and recapitalization charges
|
c
|
—
|
|
|
134,147
|
|
|
—
|
|
|
134,147
|
|
|
—
|
Income tax effect of
non-GAAP adjustments
|
d
|
(1,840)
|
|
|
(48,720)
|
|
|
(1,193)
|
|
|
(52,099)
|
|
|
(4,642)
|
Non-GAAP net
income
|
|
$
|
137,362
|
|
|
$
|
112,826
|
|
|
$
|
206,216
|
|
|
$
|
328,937
|
|
|
$
|
464,217
|
GAAP net income per
diluted share
|
|
$
|
0.81
|
|
|
$
|
0.12
|
|
|
$
|
1.21
|
|
|
$
|
1.36
|
|
|
$
|
2.70
|
Non-GAAP net income
per diluted share
|
|
$
|
0.84
|
|
|
$
|
0.68
|
|
|
$
|
1.23
|
|
|
$
|
1.99
|
|
|
$
|
2.76
|
Shares used in
diluted shares calculation
|
|
162,794
|
|
|
165,317
|
|
|
167,989
|
|
|
164,930
|
|
|
168,355
|
Pre-tax impact of
items included in Condensed Consolidated Unaudited Statements of
Operations
|
|
|
|
|
Acquisition
related charges
|
|
Restructuring,
severance and other related charges
|
|
Debt
extinguishment loss and recapitalization charges
|
|
Total pre-tax GAAP
to non-GAAP adjustments
|
Three months ended
March 31, 2015
|
|
|
|
|
|
|
|
Costs of
revenues
|
$
|
2,507
|
|
|
$
|
211
|
|
|
$
|
—
|
|
|
$
|
2,718
|
Engineering, research
and development
|
700
|
|
|
680
|
|
|
—
|
|
|
1,380
|
Selling, general and
administrative
|
721
|
|
|
2,745
|
|
|
—
|
|
|
3,466
|
Total in three months
ended March 31, 2015
|
$
|
3,928
|
|
|
$
|
3,636
|
|
|
$
|
—
|
|
|
$
|
7,564
|
Three months ended
December 31, 2014
|
|
|
|
|
|
|
|
Costs of
revenues
|
$
|
2,577
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,577
|
Engineering, research
and development
|
700
|
|
|
1,289
|
|
|
—
|
|
|
1,989
|
Selling, general and
administrative
|
555
|
|
|
2,010
|
|
|
2,478
|
|
|
5,043
|
Loss on
extinguishment of debt and other, net
|
—
|
|
|
—
|
|
|
131,669
|
|
|
131,669
|
Total in three months
ended December 31, 2014
|
$
|
3,832
|
|
|
$
|
3,299
|
|
|
$
|
134,147
|
|
|
$
|
141,278
|
Three months ended
March 31, 2014
|
|
|
|
|
|
|
|
Costs of
revenues
|
$
|
1,921
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,921
|
Engineering, research
and development
|
836
|
|
|
—
|
|
|
—
|
|
|
836
|
Selling, general and
administrative
|
1,071
|
|
|
—
|
|
|
—
|
|
|
1,071
|
Total in three months
ended March 31, 2014
|
$
|
3,828
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,828
|
To supplement our condensed consolidated financial statements
presented in accordance with GAAP, we provide certain non-GAAP
financial information, which is adjusted from results based on GAAP
to exclude certain costs and expenses, as well as other
supplemental information. The non-GAAP and supplemental information
is provided to enhance the user's overall understanding of our
operating performance and our prospects in the future.
Specifically, we believe that the non-GAAP information provides
useful measures to both management and investors regarding
financial and business trends relating to our financial performance
by excluding certain costs and expenses that we believe are not
indicative of our core operating results. The non-GAAP information
is among the budgeting and planning tools that management uses for
future forecasting. However, because there are no standardized or
generally accepted definitions for most non-GAAP financial metrics,
definitions of non-GAAP financial metrics (for example, determining
which costs and expenses to exclude when calculating such a metric)
are inherently subject to significant discretion. As a result,
non-GAAP financial metrics may be defined very differently from
company to company, or even from period to period within the same
company, which can potentially limit the usefulness of such
information to an investor. The presentation of non-GAAP and
supplemental information is not meant to be considered in isolation
or as a substitute for results prepared and presented in accordance
with United States GAAP.
a.
|
Acquisition related
charges includes amortization of intangible assets associated with
acquisitions. Management believes that the expense associated with
the amortization of acquisition related intangible assets are
appropriate to be excluded because a significant portion of the
purchase price for acquisitions may be allocated to intangible
assets that have short lives, and exclusion of these expenses
allows comparisons of operating results that are consistent over
time for both KLA-Tencor's newly acquired and long-held businesses.
Management believes excluding these items helps investors compare
our operating performance with our results in prior periods as well
as with the performance of other companies.
|
|
|
b.
|
Restructuring,
severance and other related charges include costs associated with
employee severance and other exit costs, impairment of certain
long-lived assets. Management believes excluding these items helps
investors compare our operating performance with our results in
prior periods as well as with the performance of other
companies.
|
|
|
c.
|
Debt extinguishment
loss and recapitalization charges include a pre-tax loss on early
extinguishment of debt related to the 6.900% Senior Notes due in
2018, net and certain other expenses incurred in connection with
the leveraged recapitalization plan which was completed in the
second quarter of the fiscal year ending June 30, 2015. Management
believes that it is appropriate to exclude these items as they are
not indicative of ongoing operating results and therefore limit
comparability and excluding these items helps investors compare our
operating performance with our results in prior periods as well as
with the performance of other companies.
|
|
|
d.
|
Income tax effect of
non-GAAP adjustments includes the income tax effects of the
excluded items noted above as well as additional true up
adjustment to the tax rate arising from the tax impacts associated
with the pre-tax loss on extinguishment of debt that was recognized
in the three months ended December 31, 2014. Management believes
that it is appropriate to exclude the tax effects of the items
noted above in order to present a more meaningful measure of
non-GAAP net income.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/kla-tencor-reports-fiscal-2015-third-quarter-results-300070716.html
SOURCE KLA-Tencor Corporation