SpeedFam-IPEC and MEMC Announce Litigation Settlement
CHANDLER, Ariz.--(BUSINESS WIRE)--Oct. 5, 2001--SpeedFam-IPEC, Inc. and MEMC Electronic Materials, Inc. today announced that they have settled all litigation between the parties. In connection with this settlement, SpeedFam-IPEC has agreed to pay MEMC $1.8 million.
Because this settlement agreement was reached prior to SpeedFam-IPEC filing its Form 10-Q for the first fiscal quarter of 2002, the company will record the impact of this settlement agreement in its first-quarter results. Accordingly, the company has recorded a $1.8-million adjustment to operating expenses, resulting in an adjusted net loss of $17 million, or $0.56 per share, for the first quarter ended September 1, 2001. Exclusive of this adjustment and a cumulative effect adjustment for the adoption of FAS 142, the net loss for the quarter was $12.6 million, or $0.42 per share.
``Although we vigorously defended our best interests in these proceedings, we concluded that the best course of action for SpeedFam-IPEC and our customers was to settle this litigation,'' said Richard Faubert, president and chief executive officer of SpeedFam-IPEC. ``During this critical phase in the industry cycle, it is imperative that we maintain our focus on placing the Momentum(TM) system at leading device manufacturers worldwide in order to position the company for success at the next industry upturn.''
SpeedFam-IPEC, Inc.
SpeedFam-IPEC, Inc. is a pioneer and innovator in the manufacture of chemical mechanical planarization (CMP) systems used in the fabrication of advanced semiconductor devices. With an extensive worldwide installed base, the company enables the development of next-generation integrated circuit technology through its leading-edge polishing systems. SpeedFam-IPEC also markets and distributes parts used in CMP and precision surface processing. With headquarters in Chandler, Ariz., and offices throughout the world, SpeedFam-IPEC is publicly traded on NASDAQ under the symbol SFAM. The company's website is www.sfamipec.com.
This news release contains forward-looking statements about the next upturn and our success at the next upturn. These statements are subject to known and unknown risks and uncertainties. Actual results could differ. The economic downturn may continue longer than anticipated. The CMP market may not grow. We may not be able to maintain or increase our share of the CMP market due to many factors. We may encounter problems introducing Momentum, such as not having adequate manufacturing capacity, technological problems and lack of customer acceptance. We may not be able to achieve the high levels of customer satisfaction required to obtain repeat business from existing customers. We may not be successful in our efforts to develop new accounts. See SpeedFam-IPEC's filings with the SEC, including the Annual Report on Form 10-K filed on August 24, 2001, for additional risks affecting the company.
SPEEDFAM-IPEC, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars and shares in thousands, except per share data)
First Quarter Ended
September 1, September 2,
2001 2000(1)
----------- -----------
Net sales $ 41,082 $ 73,019
Cost of sales 31,695 57,085
----------- -----------
Gross margin 9,387 15,934
----------- -----------
Operating expenses:
Research and development 12,388 16,557
Selling, general and administrative 8,120 16,453
Litigation settlement cost 1,800 --
Restructuring charges -- 5,123
----------- -----------
Total operating expenses 22,308 38,133
----------- -----------
Operating income (loss) (12,921) (22,199)
Other income (expense), net (1,502) (121)
----------- -----------
Income (loss) from consolidated
companies (14,423) (22,320)
Gain (loss) on sale of joint
venture interest -- (10,763)
Equity in net earnings (loss)
of affiliates -- 110
----------- -----------
Income (loss) before cumulative
effect of change in
accounting principle (14,423) (32,973)
Cumulative effect of change in
accounting principle (2,582) (36,542)
----------- -----------
Net income (loss) attributable
to common stockholders $ (17,005) $ (69,515)
=========== ===========
Net income (loss) per share:
Net income (loss) before
cumulative effect of change in
accounting principle $ (0.48) $ (1.10)
Cumulative effect of change in
accounting principle $ (0.08) $ (1.23)
Net income (loss) attributable
to common stockholders:
Basic $ (0.56) $ (2.33)
Diluted $ (0.56) $ (2.33)
Weighted average number of shares:
Basic 30,223 29,818
Diluted 30,223 29,818
(1) Restated for the adoption of SAB 101.
SPEEDFAM-IPEC, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
September 1, June 2,
2001 2001(2)
----------- -----------
ASSETS
Current assets:
Cash, cash equivalents and
short-term investments $ 50,193 $ 60,839
Trade accounts receivable, net 46,592 60,619
Inventories 86,564 83,857
Shipped systems pending acceptance 8,735 13,953
Other current assets 3,504 4,549
----------- -----------
Total current assets 195,588 223,817
Property, plant and equipment, net 73,248 75,241
Other assets 15,614 15,827
----------- -----------
Total assets $ 284,450 $ 314,885
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 173 $ 229
Accounts payable 18,257 23,314
Deferred revenue 34,443 46,281
Other current liabilities 21,914 18,085
----------- -----------
Total current liabilities 74,787 87,909
Long-term debt 115,105 115,124
Other liabilities 4,976 5,911
----------- -----------
Total liabilities 194,868 208,944
Stockholders' equity 89,582 105,941
----------- -----------
Total liabilities and
stockholders' equity $ 284,450 $ 314,885
=========== ===========
(2) Certain prior period amounts have been reclassified to conform
to the current year presentation. |
