Rudolph Reports 2002 Second Quarter Results; EPS Exceeds Company's Previous Guidance
FLANDERS, N.J., July 29 /PRNewswire-FirstCall/ -- Rudolph Technologies, Inc. (Nasdaq: RTEC - News), a worldwide leader in the design, development, manufacture and support of high-performance process control metrology systems used by semiconductor device companies, today announced financial results for the second quarter ended June 30, 2002.
Second Quarter Results
The Company's second quarter revenue totaled $13.1 million, representing a 9% sequential increase from $12.0 million in the first quarter of 2002. This compared to $23.1 million in revenue for the second quarter of 2001. Despite the year-over-year revenue decline, the Company maintained profitability, and exceeded its guidance of $0.03 per diluted share. Second quarter net income was $656,000, or $0.04 per diluted share, up sequentially from $447,000, or $0.03 per diluted share in the first quarter. For the prior year period net income was $4.1 million, or $0.25 per diluted share. The lower year-over-year results were due to the well-documented industry slowdown, which resulted in reduced capital equipment spending by semiconductor chip manufacturers.
"I am pleased with our second quarter results, as once again we exceeded our guidance," said Paul F. McLaughlin, Chairman and CEO. "We continue to gain technology acceptance with our MetaPULSE(TM) and S-ultra families of tools, and order growth during the quarter was double digit and even better than we anticipated. The success of our leading-edge technology has made MetaPULSE the industry standard for metal film metrology, particularly in copper, and has positioned Rudolph for further growth."
Second quarter gross margin was 41%, compared to 52% in the prior year period, and 43% in the first quarter ended March 31, 2002. The sequential gross margin decrease was the result of product mix. On a year-over-year basis, gross margin decreased due to Customer Service and fixed manufacturing costs being a higher component of cost of goods sold on a lower revenue base. Product margins remain strong.
Research & development (R&D) expenses for the second quarter totaled $2.5 million, compared to $2.4 million in the first quarter of 2002, and $3.5 million in the year ago period. As a percentage of revenue, R&D was 19%, compared to 15% in the same quarter last year. The Company expects R&D spending to increase in absolute dollars and represent approximately 18% of revenue in the third quarter of 2002.
Selling, general & administrative (S,G&A) expenses for the second quarter totaled $2.2 million, compared to $2.4 million in the first quarter of 2002, and $2.8 million in the prior year period. The sequential and year-over-year decrease reflects reduced administrative spending and the completion of certain infrastructure projects in the prior year period. As a percentage of revenue, S,G&A was 17% in the 2002 second quarter, compared to 12% in the comparable prior year period.
"We continue to maintain a tight control on all administrative spending to ensure that expense increases do not precede revenue growth; however, we continue to spend on new product development and infrastructure initiatives, which has been the core of our growth strategy," commented Steven Roth, Chief Financial Officer.
Balance Sheet Strength
At June 30, 2002, the Company's cash and short-term investments totaled $97.8 million increasing by $3.3 million during the second quarter. Working capital was $130.7 million. When the acquisition of ISOA is completed within the next 90 days, cash and short-term investments are expected to be approximately $65 to $70 million.
Outlook
The Company currently anticipates revenue for the third quarter ending September 30, 2002 to grow another five to eight percent, with delivery times lengthening and backlog continuing to grow. The Company currently anticipates earnings to be $0.05 per diluted share.
As the semiconductor industry returns to a more normalized business environment, Rudolph expects visibility to improve. The Company is currently projecting total revenue for all of 2002 to again exceed industry growth averages. Earnings are forecasted to track revenue and be back-end loaded as the recovery takes hold.
On July 23, 2002, Rudolph announced a definitive agreement to acquire privately held ISOA, a defect control company based in Richardson, Texas. The acquisition is an all cash transaction valued at approximately $27.5 million, and is expected to close within 90 days.
"Our recently announced acquisition of ISOA is a tremendous opportunity for Rudolph. We are entering the billion-dollar wafer inspection market with a portfolio of products and services that are recognized as being among the best technically in the industry. We are extremely optimistic considering our industry-leading MetaPULSE family of tools shows our past success at commercializing technology emerging from a university setting, and we fully expect to duplicate that for ISOA's WaferView tools, which originated at Texas Tech," concluded McLaughlin.
"I am particularly pleased with this first acquisition for RTEC since becoming a public company in November 1999. This is the kind of acquisition we have been looking for as it has several positive benefits including the fact that RTEC (1) acquires an extremely experienced technical team; (2) acquires a full suite of leading edge tools and software systems; (3) acquires a company that is in our market sweet spot with a business model and profitability model that is consistent with our own and finally (4) acquires a company that needs the leverage we offer with our established infrastructure."
Conference call
Rudolph Technologies will be hosting a conference call today at 4:45 PM EDT. A live webcast will also be available to investors at vcall.com. To listen to the live call, please go to the Web site at least fifteen minutes early to register, download and install any necessary audio software.
About Rudolph Technologies
Rudolph is a worldwide leader in the design, development, manufacture and support of high-performance process control metrology systems used by semiconductor device manufacturers. The Company provides a full-fab solution through its families of proprietary systems for both transparent and opaque thin film measurement. Rudolph's product development has successfully anticipated and addressed many emerging trends that are driving the semiconductor industry's growth. The Company's success in creating complementary metrology applications through aggressive research and development is key to Rudolph's strategy for continued technological and market leadership.
This press release contains forward-looking statements, including, but not limited to, statements related to our expectations regarding the closure of the ISOA acquisition and the successful commercialization of ISOA's technology, our anticipated levels of cash and short-term investments, and our revenue and earnings expectations for the remainder of 2002. Actual results may differ materially from those projected due to a number of risks, including the impact of the slowdown in the overall economy and the uncertainty of the current global political environment following the recent terrorist attacks, changes in customer demands for our existing and new products, the timing, cancellation or delay of customer orders and shipments and the timing of revenue recognition of shipments, new product offerings from our competitors, changes in or an inability to execute Rudolph Technologies' business strategy, unanticipated manufacturing or supply problems, changes in tax rules, and an inability to close the acquisition of ISOA and integrate ISOA's technology. Rudolph Technologies cannot guarantee future results, levels of activity, performance or achievements. The matters discussed in this press release also involve risks and uncertainties summarized under the heading "Risk Factors" in Rudolph Technologies' Form 10K filed for the year ended December 31, 2001. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Rudolph Technologies does not assume any obligation to update the forward-looking information contained in this press release.
RUDOLPH TECHNOLOGIES
BALANCE SHEETS
($000)
June 30, December 31,
2002 2001
(Unaudited)
ASSETS
Current assets
Cash $67,878 $94,642
Short-term investments 29,951 --
Accounts receivable, net 15,441 13,523
Inventories 22,622 22,695
Prepaid and other assets 3,547 3,435
Total current assets 139,439 134,295
Net property, plant and equipment 4,946 5,221
Intangibles 2,053 2,181
Deferred taxes 5,732 5,790
Other assets 1,239 311
Total assets $153,409 $147,798
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities $3,959 $2,668
Other current liabilities 4,745 2,980
Total current liabilities 8,704 5,648
Stockholders' equity 144,705 142,150
Total liabilities & stockholders' equity $153,409 $147,798
RUDOLPH TECHNOLOGIES
STATEMENTS OF OPERATIONS
(Unaudited)
($000)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2002 2001 2002 2001
Revenues $13,118 $23,088 $25,156 $53,649
Cost of revenues 7,737 11,089 14,612 24,902
Gross profit 5,381 11,999 10,544 28,747
Operating expenses:
Research & development 2,536 3,481 4,958 6,427
Selling, general &
administrative 2,178 2,760 4,587 7,501
Amortization 64 85 128 169
Total operating expenses 4,778 6,326 9,673 14,097
Operating income 603 5,673 871 14,650
Interest income and
other, net 416 860 843 1,575
Provision for income taxes 363 2,416 610 6,006
Net income $656 $4,117 $1,104 $10,219
Net income per share:
Basic $0.04 $0.26 $0.07 $0.65
Diluted $0.04 $0.25 $0.07 $0.62
Weighted average shares outstanding:
Basic 16,179,502 16,039,391 16,163,240 15,703,506
Diluted 16,722,438 16,712,286 16,790,226 16,386,236
SOURCE: Rudolph Technologies, Inc. |
