MKS Instruments Reports Q1 2010 Financial Results
ANDOVER, Mass., April 21, 2010 /PRNewswire via COMTEX/ --MKS Instruments, Inc. (Nasdaq: MKSI), a global provider of technologies that enable advanced processes and improve productivity, today reports first quarter 2010 financial results.
Sales were $198.1 million, an increase of 33 percent from $149.3 million in the fourth quarter of 2009, and an increase of 158 percent from $76.7 million in the first quarter of 2009.
First quarter net income was $29.2 million, or $0.58 per diluted share, compared to net income of $14.9 million, or $0.30 per diluted share in the fourth quarter of 2009, and a net loss of $16.5 million, or ($0.34) per basic share in the first quarter of 2009.
Non-GAAP net earnings, which exclude special items, were $29.2 million, or $0.58 per diluted share, compared to $15.5 million, or $0.31 per diluted share in the fourth quarter of 2009, and a net loss of $11.0 million, or ($0.23) per basic share in the first quarter of 2009.
Leo Berlinghieri, Chief Executive Officer and President, said, "As we exited 2009, we reported seeing signs of rapid recovery in our business and these conditions continued to accelerate in the first quarter. Our broad technology portfolio opens opportunities to us in many advanced and growing markets including LEDs, medical, biopharm, environmental, thin films, semiconductor, solar and more, and we saw substantial growth in many of these markets we serve.
"While it is always difficult to project future business with our short lead times, many analysts are projecting improved business conditions in 2010 for the advanced technology markets we serve. We are focused on participating in the growth of these markets, as well as penetrating and increasing share in new and expanding markets, and expect these will fuel additional growth for MKS in 2010. Based on these factors and current business levels, we estimate that our second quarter sales may range from $205 to $220 million and, at these volumes, our non-GAAP net earnings could range from $0.56 to $0.66 per diluted share on 51 million shares outstanding. Our GAAP net income could range from $0.55 to $0.65 per diluted share."
Management will discuss first quarter financial results on a conference call tomorrow at 8:30 a.m. (Eastern Time). Dial-in numbers are 1-800-762-8779 for domestic callers and 480-629-9771 for international callers. The call will be broadcast live and available for replay at http://www.mksinst.com/. To hear a telephone replay through April 29, 2010, dial 303-590-3030, pass code 4265616#.
The financial results that exclude certain charges and special items are not in accordance with Accounting Principles Generally Accepted in the United States of America (GAAP). MKS' management believes the presentation of non-GAAP financial measures, which exclude costs associated with acquisitions and special items, is useful to investors for comparing prior periods and analyzing ongoing business trends and operating results.
MKS Instruments, Inc. is a global provider of instruments, subsystems and process control solutions that measure, control, power, monitor and analyze critical parameters of advanced manufacturing processes to improve process performance and productivity. Our products are derived from our core competencies in pressure measurement and control, materials delivery, gas composition analysis, electrostatic charge management, control and information technology, power and reactive gas generation, and vacuum technology. Our primary served markets are manufacturers of capital equipment for semiconductor devices, and for other thin film applications including flat panel displays, solar cells, light emitting diodes, data storage media, and other advanced coatings. We also leverage our technology in other markets with advanced manufacturing applications including medical equipment, pharmaceutical manufacturing, energy generation, and environmental monitoring.
This release contains projections or other forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27 of the Securities Act, and Section 21E of the Securities Exchange Act regarding MKS' future growth and the future financial performance of MKS. These projections or statements are only predictions. Actual events or results may differ materially from those in the projections or other forward-looking statements set forth herein. Among the important factors that could cause actual events to differ materially from those in the projections or other forward-looking statements are the fluctuations in capital spending in the semiconductor industry, fluctuations in net sales to MKS' major customers, potential fluctuations in quarterly results, the challenges, risks and costs involved with integrating the operations of MKS and any acquired companies, dependence on new product development, rapid technological and market change, acquisition strategy, manufacturing and sourcing risks, volatility of stock price, international operations, financial risk management, and future growth subject to risks. Readers are referred to MKS' filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K, for a discussion of these and other important risk factors concerning MKS and its operations. MKS is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
MKS Instruments, Inc.
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)
Three Months Ended
------------------
March March December
31, 31, 31,
2010 2009 2009
---- ---- ----
Net sales $198,069 $76,719 $149,270
Cost of sales 109,605 66,370 86,536
------- ------ ------
Gross profit 88,464 10,349 62,734
Research and development 16,468 15,463 13,681
Selling, general and
administrative 29,374 28,222 27,814
Amortization of acquired
intangible assets 651 1,653 872
Gain on sale of asset (682) - -
Restructuring - 5,620 (44)
--- ----- ---
Income (loss) from operations 42,653 (40,609) 20,411
Interest income, net 325 1,009 156
--- ----- ---
Income (loss) before income
taxes 42,978 (39,600) 20,567
Provision (benefit) for income
taxes 13,753 (23,101) 5,620
------ ------- -----
Net income (loss) $29,225 $(16,499) $14,947
======= ======== =======
Net income (loss) per share:
Basic $0.59 $(0.34) $0.30
Diluted $0.58 $(0.34) $0.30
Weighted average shares
outstanding:
Basic 49,601 48,994 49,509
Diluted 50,600 48,994 50,459
The following supplemental
Non-GAAP earnings (loss)
information is presented to
aid in understanding MKS'
operating results:
GAAP net income (loss) $29,225 $(16,499) $14,947
Adjustments:
Amortization of acquired
intangible assets 651 1,653 872
Excess & obsolete inventory
adjustment (Note 1) - 12,900 -
Restructuring and related
items (Note 2) - 4,322 (44)
Gain on sale of asset (Note 3) (682) - -
Benefit for income taxes (Note
4) - (6,370) -
Proforma tax adjustments 39 (7,047) (279)
--- ------ ----
Non-GAAP net earnings (loss)
(Note 5) $29,233 $(11,041) $15,496
======= ======== =======
Non-GAAP net earnings (loss)
per share (Note 5) $0.58 $(0.23) $0.31
===== ====== =====
Weighted average shares
outstanding -diluted 50,600 48,994 50,459
Note 1 : Cost of sales for the three month period ended March 31,
2009 includes $12,900 of excessive E&O inventory charges.
Note 2 : The three month period ended March 31, 2009 includes a
$5,620 restructuring charge primarily for severance related costs
offset by a credit of $1,298 for the reversal of previously expensed
equity compensation charges of terminated employees. The three month
period ended December 31, 2009 includes a $(44) adjustment primarily
for severance related costs.
Note 3 : The three month period ended March 31, 2010 includes a $682
gain on the sale of a vacated facility.
Note 4 : The three month period ended March 31, 2009 includes a
benefit of $6,370 attributable to the reversal of FIN 48 reserve
items as a result of a Federal audit close.
Note 5 : The Non-GAAP net earnings (loss) and Non-GAAP net earnings
(loss) per share amounts exclude amortization of acquired intangible
assets, acquisition and disposition related charges and special
items, net of applicable income taxes.
MKS Instruments, Inc.
Unaudited Consolidated Balance Sheet
(In thousands)
March 31, December 31,
2010 2009
---- ----
ASSETS
Cash and short-term
investments $285,199 $271,795
Trade accounts receivable 134,614 94,215
Inventories 126,770 118,004
Other current assets 40,780 48,867
------ ------
Total current
assets 587,363 532,881
Property, plant and
equipment, net 65,681 67,196
Goodwill 144,511 144,511
Acquired intangible assets,
net 4,312 4,963
Other assets 16,535 24,518
------ ------
Total assets $818,402 $774,069
======== ========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Short-term debt $9,701 $12,885
Accounts payable 36,829 26,292
Accrued expenses and other
liabilities 41,230 32,123
------ ------
Total current
liabilities 87,760 71,300
Other long-term liabilities 19,118 17,836
Stockholders' equity:
Common stock 113 113
Additional paid-in capital 644,564 645,411
Retained earnings 57,994 28,769
Other stockholders' equity 8,853 10,640
----- ------
Total stockholders'
equity 711,524 684,933
-------
Total liabilities and
stockholders' equity $818,402 $774,069
======== ========
SOURCE MKS Instruments, Inc.