Varian Semiconductor Equipment Associates, Inc. ("Varian
Semiconductor") (NASDAQ: VSEA) today announced results for its
fiscal year 2011 first quarter ended December 31, 2010.
Revenue for the first quarter of fiscal year 2011 totaled $282.6
million, compared to revenue of $141.3 million for the same period
a year ago. Varian Semiconductor recorded net income of $71.9
million, or $0.95 per diluted share during the first quarter of
fiscal year 2011, compared to net income of $16.6 million, or $0.22
per diluted share for the same period a year ago. The tax rate for
the first quarter of fiscal year 2011 was 10%. The quarter's tax
rate was reduced by 4% due to discrete items, including the
retroactive benefit of the R&D tax credit. The quarter's tax
rate was also lower due to the current quarter's benefit of the
R&D tax credit and a higher projected mix of international
sales.
Gary Dickerson, chief executive officer of Varian Semiconductor,
said, "Since our last earnings conference call, we have seen a
steadily increasing business demand for tools by our customers. We
are optimistic about Varian's 2011 business opportunities, some of
which are reflected in our second quarter guidance."
Bob Halliday, chief financial officer, provided forward guidance
for the second quarter of fiscal year 2011, "In the first quarter
of fiscal year 2011, we reported our highest-ever quarterly
operating margins, net income and earnings per share. Our earnings
per share of $0.95 and our revenues of $282.6 million exceeded our
guidance. Second quarter revenue is expected to be between $315.0
and $325.0 million and earnings per share are anticipated to range
from $1.02 to $1.07."
Varian Semiconductor will hold a conference call, broadcast over
the Internet, at 5:30 p.m. eastern time today to discuss Varian
Semiconductor's operating results and outlook. Access to the call
is available through the investor relations page on Varian
Semiconductor's website at www.vsea.com. Replays will be available
via the website for two weeks after the call.
About Varian Semiconductor Equipment Associates, Inc.
Varian Semiconductor is a leading supplier of ion implantation
equipment used in the fabrication of semiconductor chips. Varian
Semiconductor's products are used by chip manufacturers worldwide
to produce high-performance semiconductor devices. Customers have
made Varian Semiconductor the market leader in ion implant because
of its architecturally superior products that lower their costs and
improve their productivity.
Varian Semiconductor provides support, training, and
after-market products and services that help its customers to
obtain high utilization and productivity, reduce operating costs,
and extend capital productivity of customer investments through
multiple product generations. Varian Semiconductor has ranked #1 in
the VLSI Research Customer Satisfaction Survey 13 times over the
last 14 years. Varian Semiconductor operates globally and is
headquartered in Gloucester, Massachusetts. More information can be
found on Varian Semiconductor's web site at www.vsea.com. The
information contained in Varian Semiconductor's website is not
incorporated by reference into this release, and the website
address is included in this release as an inactive textual
reference only.
Note: This press release contains forward-looking statements for
purposes of the safe harbor provisions under The Private Securities
Litigation Reform Act of 1995. For this purpose, statements
concerning Varian Semiconductor's customer demand, business
opportunities, guidance for second quarter fiscal 2011 revenue,
earnings per diluted share, financial performance and any
statements using the terms "believes," "anticipates," "will,"
"expects," "plans" or similar expressions, are forward-looking
statements. The forward-looking statements involve a number of
risks and uncertainties. Among the important factors that could
cause actual results to differ materially from those indicated by
such forward-looking statements are: volatility in the
semiconductor equipment industry; intense competition in the
semiconductor equipment industry; Varian Semiconductor's dependence
on a small number of customers; fluctuations in Varian
Semiconductor's quarterly operating results; market adoption of
Varian Semiconductor's new products, such as the Solion implant
product; Varian Semiconductor's exposure to risks of operating
internationally; uncertain protection of Varian Semiconductor's
patent and other proprietary rights; Varian Semiconductor's
reliance on a limited group of suppliers; Varian Semiconductor's
ability to manage potential growth, decline and strategic
transactions; Varian Semiconductor's reliance on one primary
manufacturing facility; and Varian Semiconductor's dependence on
certain key personnel. These and other important risk factors that
may affect actual results are discussed in detail under the caption
"Risk Factors" in Varian Semiconductor's Annual Report on Form 10-K
for the fiscal year ended October 1, 2010 and in other reports
filed by Varian Semiconductor with the Securities and Exchange
Commission. Varian Semiconductor cannot guarantee any future
results, levels of activity, performance or achievement. Varian
Semiconductor undertakes no obligation to update any of the
forward-looking statements after the date of this release.
VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
Three Months Ended
------------------------
December 31, January 1,
2010 2010
----------- -----------
(unaudited)
Revenue
Product $ 259,568 $ 127,461
Service 23,013 13,807
----------- -----------
Total revenue 282,581 141,268
Cost of revenue 143,631 72,581
----------- -----------
Gross profit 138,950 68,687
----------- -----------
Operating expenses
Research, development and engineering 26,624 21,728
Marketing, general and administrative 33,517 26,103
----------- -----------
Total operating expenses 60,141 47,831
----------- -----------
Operating income 78,809 20,856
Interest income, net 703 865
Other expense, net (18) (504)
----------- -----------
Income before income taxes 79,494 21,217
Provision for income taxes 7,640 4,595
----------- -----------
Net income $ 71,854 $ 16,622
=========== ===========
Weighted average shares outstanding - basic 74,265 73,700
Weighted average shares outstanding - diluted 75,358 74,753
Net income per share - basic $ 0.97 $ 0.23
Net income per share - diluted $ 0.95 $ 0.22
VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
December 31, October 1,
2010 2010
------------ ------------
(unaudited)
ASSETS
Current assets
Cash and cash equivalents $ 275,081 $ 235,450
Short-term investments 54,191 60,871
Accounts receivable, net 212,024 223,960
Inventories 188,856 190,538
Deferred income taxes 19,751 20,955
Other current assets 26,533 21,428
------------ ------------
Total current assets 776,436 753,202
Long-term investments 122,213 101,332
Property, plant and equipment, net 70,034 68,140
Long-term deferred income taxes 4,363 4,363
Other assets 15,122 15,173
------------ ------------
Total assets $ 988,168 $ 942,210
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current portion of long-term debt $ 683 $ 668
Accounts payable 43,154 53,529
Accrued expenses 32,484 46,071
Income taxes payable 9,038 7,476
Product warranty 10,708 8,627
Deferred revenue 38,134 46,707
------------ ------------
Total current liabilities 134,201 163,078
Long-term accrued expenses and other
long-term liabilities 84,812 80,206
Long-term debt 748 924
------------ ------------
Total liabilities 219,761 244,208
Stockholders' equity
Common stock 965 958
Capital in excess of par value 670,237 654,458
Less: Cost of treasury stock (751,710) (732,859)
Retained earnings 847,489 775,635
Accumulated other comprehensive income
(loss) 1,426 (190)
------------ ------------
Total stockholders' equity 768,407 698,002
------------ ------------
Total liabilities and
stockholders' equity $ 988,168 $ 942,210
============ ============
Contacts: Bob Halliday Executive Vice President and Chief
Financial Officer 978.282.7597 or Tom Baker Vice President, Finance
978.282.2301
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