Applied Materials Announces Record Results for Second Fiscal Quarter 2000; Record New Orders, Net Sales and Net Income
SANTA CLARA, Calif.--(BUSINESS WIRE)--May 10, 2000--Applied Materials, Inc., the world's largest supplier of wafer fabrication solutions to the semiconductor industry, reported record results for its second fiscal quarter ended April 30, 2000. Record net income, excluding one-time items and the acquisition of Etec Systems, Inc. (Etec), for the second fiscal quarter of 2000 was $454 million, or $0.55 per diluted share, up from $328 million, or $0.40 per diluted share, for the first fiscal quarter of 2000, and up significantly from $140 million, or $0.18 per diluted share, for the second fiscal quarter of 1999.
Record net sales were $2.19 billion, up 27 percent from $1.72 billion for the first fiscal quarter of 2000, and up 87 percent from $1.17 billion for the second fiscal quarter of 1999. Record ongoing net income (net income, excluding one-time items) for the second fiscal quarter of 2000 was $459 million, or $0.53 per diluted share, up from $327 million, or $0.39 per diluted share, for the first fiscal quarter of 2000, and up significantly from $142 million, or $0.17 per diluted share, for the second fiscal quarter of 1999. Reported results for all periods presented reflect the acquisition of Etec, which was completed during the quarter and accounted for as a pooling-of-interests.
Record new orders of $2.93 billion for the second fiscal quarter of 2000 increased 19 percent from $2.45 billion for the first fiscal quarter of 2000, and increased 101 percent from $1.46 billion for the second fiscal quarter of 1999. Regional distribution of new orders for the second fiscal quarter of 2000 was: Taiwan 25 percent, North America 25 percent, Japan 15 percent, Europe 14 percent, Southeast Asia and China 11 percent and Korea 10 percent. Record backlog at the end of the second fiscal quarter of 2000 was $3.18 billion, compared to $2.46 billion at the end of the first fiscal quarter of 2000.
Gross margin for the second fiscal quarter of 2000 was 50.1 percent, up from 49.8 percent for the first fiscal quarter of 2000, and up from 46.3 percent for the second fiscal quarter of 1999. Record ongoing net income as a percentage of net sales was 21.0 percent for the second fiscal quarter of 2000, compared to 19.0 percent for the first fiscal quarter of 2000 and 12.1 percent for the second fiscal quarter of 1999.
"We are very pleased to report another record quarter resulting from increased customer demand and improved operating leverage. Global semiconductor use continues to expand, driven by communications, server-related and consumer products," said James C. Morgan, chairman and chief executive officer.
Feature-rich, digital telecommunications and consumer applications for semiconductors are growing faster than expected. This demand for advanced devices has resulted in increased capital spending by semiconductor manufacturers. Applied Materials' new orders for the second fiscal quarter of 2000 reflect customers' increased investments in advanced manufacturing capacity and next-generation technologies for new copper and low-k dielectric applications.
"We are in a major industry upturn and expect strong demand to continue for semiconductor devices that enable Internet-related, telecommunications and consumer products. Applied Materials, with its industry-leading solutions and unmatched global support infrastructure, is well-positioned to capitalize on this opportunity," concluded Morgan.
This press release contains certain forward-looking statements, including, but not limited to, those relating to capital spending by customers, semiconductor demand, product applications and customer migration to advanced technologies. These 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: changes in customer capacity requirements and demand for semiconductors; the ability of the Company to maintain its technology and market share leadership; the successful and timely development of new markets, products, processes and services; the successful integration and growth of acquired businesses; the ability of the Company to satisfy manufacturing demands, based in part on the availability of critical components; the ability of the Company to continue to improve productivity and operating performance; changes in global economic conditions; and those risks and uncertainties described in the Company's filings with the Securities and Exchange Commission. The Company assumes no obligation to update the information in this press release.
Applied Materials, Inc., a Fortune 500 global growth company, is the world's largest supplier of wafer fabrication solutions to the semiconductor industry. Applied Materials is traded on the Nasdaq National Market under the symbol, "AMAT". Applied Materials' website is http://www.appliedmaterials.com. -0-
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APPLIED MATERIALS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended Six Months Ended
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(In thousands, except May 2, April 30, May 2, April 30,
per share amounts) 1999 2000 1999 2000
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Net sales $1,170,662 $2,190,031 $1,992,037 $3,912,221
Cost of products sold(a) 628,373 1,092,433 1,088,948 1,957,302
---------- ---------- ---------- ----------
Gross margin 542,289 1,097,598 903,089 1,954,919
Operating expenses:
Research, development
and engineering 179,856 253,283 338,195 476,563
Marketing and selling 81,135 111,580 156,036 212,292
General and
administrative(a) 86,000 118,890 152,416 210,707
Non-recurring items(a) -- 40,000 5,000 40,000
---------- ---------- ---------- ----------
Income from operations 195,298 573,845 251,442 1,015,357
Non-recurring income(a) -- 68,158 20,000 68,158
Interest expense 11,753 13,259 23,376 25,489
Interest income 24,264 41,072 50,704 78,992
---------- ---------- ---------- ----------
Income before taxes
and equity in net
income/(loss)
of joint venture 207,809 669,816 298,770 1,137,018
Provision for
income taxes 64,497 200,945 93,124 341,044
---------- ---------- ---------- ----------
Income before equity in
net income/(loss) of
joint venture 143,312 468,871 205,646 795,974
Equity in net
income/(loss) of
joint venture (1,182) -- 2,275 --
---------- ---------- ---------- ----------
Income from
continuing operations 142,130 468,871 207,921 795,974
Provision for
discontinuance
of joint venture 1,182 -- (2,275) --
---------- ---------- ---------- ----------
Net income $ 143,312 $ 468,871 $ 205,646 $ 795,974
---------- ---------- ---------- ----------
Earnings per share:
Basic - continuing
operations $ 0.18 $ 0.58 $ 0.27 $ 0.99
Basic - discontinued
operations -- -- -- --
---------- ---------- ---------- ----------
Total basic $ 0.18 $ 0.58 $ 0.27 $ 0.99
---------- ---------- ---------- ----------
Diluted -
continuing operations $ 0.17 $ 0.54 $ 0.25 $ 0.93
Diluted -
discontinued operations -- -- -- --
---------- ---------- ---------- ----------
Total diluted $ 0.17 $ 0.54 $ 0.25 $ 0.93
---------- ---------- ---------- ----------
Weighted average
number of shares:
Basic 776,130 805,142 772,606 801,940
Diluted 819,832 861,200 813,068 856,666
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Historical amounts have been restated to reflect the acquisition
of Etec, which was completed on March 29, 2000, and a two-for-one
stock split in the form of a 100 percent stock dividend, effective
March 15, 2000.
(a) The Company's results of operations for the second fiscal quarter
of 2000 include: 1) a pre-tax charge of $14 million (consisting of
$6.5 million in cost of products sold and $7.5 million in general
and administrative expenses) to conform Etec's accounting policies
to those of the Company; 2) $40 million of pre-tax, non-recurring
operating expenses incurred in connection with the acquisition of
Etec; and 3) $68 million of pre-tax, non-operating income related
to a previous litigation settlement with ASM International, B.V.
APPLIED MATERIALS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS(b)
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October 31, April 30,
(In thousands) 1999 2000
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ASSETS
Current assets:
Cash and cash equivalents $ 868,121 $ 1,186,813
Short-term investments 1,951,254 2,187,115
Accounts receivable, net 1,268,146 1,650,661
Inventories 727,107 979,751
Deferred income taxes 341,668 331,266
Other current assets 154,424 153,486
----------- -----------
Total current assets 5,310,720 6,489,092
Property, plant and equipment, net 1,278,269 1,241,786
Other assets 425,521 398,956
----------- -----------
Total assets $ 7,014,510 $ 8,129,834
----------- -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ 5,789 $ 26
Current portion of long-term debt 36,484 42,055
Accounts payable and accrued expenses 1,442,718 1,633,690
Income taxes payable 246,506 249,390
----------- -----------
Total current liabilities 1,731,497 1,925,161
Long-term debt 584,357 575,847
Deferred income taxes and other liabilities 123,398 135,806
----------- -----------
Total liabilities 2,439,252 2,636,814
----------- -----------
Stockholders' equity:
Common stock 7,932 8,076
Additional paid-in capital 1,443,723 1,572,793
Retained earnings 3,122,337 3,917,603
Accumulated other comprehensive
income/(loss) 1,266 (5,452)
----------- -----------
Total stockholders' equity 4,575,258 5,493,020
----------- -----------
Total liabilities and
stockholders' equity $ 7,014,510 $ 8,129,834
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Historical amounts have been restated to reflect the acquisition
of Etec, which was completed on March 29, 2000, and a two-for-one
stock split in the form of a 100 percent stock dividend, effective
March 15, 2000.
(b) Amounts as of April 30, 2000 are unaudited. Amounts as of October
31, 1999 are audited. *T
CONTACT: Applied Materials, Inc.
Carolyn Schwartz, 408/748-5227 (investment community)
Jeffrey Lettes, 408/563-5161 (editorial/media)