NEWP ( $19-$17)PE=15 Cap=600Mil....2c vs 6c
siliconinvestor.com
IRVINE, Calif., Oct. 17, 2001 (PRIMEZONE) -- Newport Corporation (Nasdaq:NEWP - news) today reported sales of $62.9 million and pro forma earnings per share of $0.02 for the third quarter of 2001, results that are slightly better than the company's previous guidance.
Pro forma results for the third quarter of 2001 exclude one-time charges of approximately $39.1 million, comprised of inventory revaluations of $24.4 million, facility closure costs of $8.2 million, employee severance of $3.4 million, and write-down of impaired assets of $3.1 million. The charges are related to the company's previously announced cost reduction programs, which are designed to improve the company's profitability both during and after the current period of weak demand, which the company expects to last at least through the first half of 2002.
Including the effects of these non-recurring charges, the company reported a net loss of $25.5 million, or $0.70 per share, for the third quarter of 2001. Including the effects of all non-recurring charges from both the first and third quarters of 2001, the company recorded a net loss of $6.4 million, or $0.18 per share, on net sales of $268.5 million for the nine months ended September 30, 2001.
Net sales for the quarter ended September 30, 2001 totaled $62.9 million, a decrease of 15 percent from $73.6 million in the prior-year period. Results in the third quarter reflect a 54 percent year-over-year decrease in sales to the fiber optic communications market to $14.6 million, compared with $31.5 million in the prior-year third quarter. This decrease was partially offset by a 33 percent increase in sales to the semiconductor capital equipment market to $22.5 million, compared with $16.9 million in the third quarter a year ago. Net sales to the company's other end markets totaled $25.8 million, an increase of 2 percent from $25.2 million a year ago. Net sales for the first nine months of 2001 increased 43 percent to $268.5 million, compared with $187.2 million for the corresponding period last year.
New orders received in the third quarter equaled $38.6 million, compared with $55.2 million in the second quarter of 2001. During the third quarter, the company recorded order cancellations of approximately $7.8 million, resulting in net orders of approximately $30.8 million. In addition to the cancellations, the company noted that the shippable backlog was further reduced by $4.9 million for orders that were rescheduled for delivery beyond the next 12 months.
Orders from customers in the fiber optic communications market were $6.2 million in the third quarter of 2001, compared with $11.9 million in the second quarter of 2001, and $48.7 million in the prior-year third quarter. Orders from customers in the semiconductor capital equipment market were $7.0 million in the third quarter of 2001, compared with $16.8 million in the second quarter of 2001 and $35.2 million in the prior-year third quarter. Orders from customers in Newport's other end markets were $25.4 million in the third quarter of 2001, compared with $26.5 million in the second quarter of 2001 and $29.6 million in the prior-year third quarter.
``Despite the sluggish environment in our key end markets, results for the third quarter were slightly better than we anticipated in early September,'' said Robert G. Deuster, chairman and chief executive officer. ``As we have said for the last few quarters, orders from our fiber optic communications customers are slow due to excess manufacturing capacity and severely reduced demand from their own customers for components. At the same time, the current weakness in our semiconductor equipment business has been exacerbated by order push-outs by several of our large semiconductor equipment customers relating to products for optical and robotic applications, which we believe is due to delays in 300-millimeter tool deployments. We expect these conditions to continue into 2002. Accordingly, we have moved aggressively to bring Newport's cost structure in line with the difficult market environment and increase the efficiency of our operations.''
The company's cost reduction measures, announced in July and September, are currently being implemented and include the following:
-- Adjustments of approximately $24.4 million to the carrying value
of inventory to reflect current market conditions and resulting
revisions to sales forecasts.
-- Consolidation of manufacturing facilities in Garden Grove,
California, San Luis Obispo, California and Longmont, Colorado,
into Newport's expanded operations in Irvine, California, and
consolidation of all metrology systems manufacturing into the
company's CEJohansson operations in Eskilstuna, Sweden. The
consolidations are expected to be completed by the second quarter
of 2002.
-- Workforce downsizing of approximately 400 employees or 20 percent
of total headcount. Headcount has already been reduced by
approximately 230 people. The remaining reductions will occur as
the plant consolidations are completed.
``These actions are designed to maximize Newport's profitability during the current market downturn and then also once the current cycle reverses,'' Deuster added. ``At the same time, we continue to invest in research and development of next-generation products to further strengthen Newport's leadership position as a provider of powerful manufacturing and automation solutions to the fiber optic communications, semiconductor equipment and general metrology markets. Notwithstanding the current downturn, we remain confident that there will be a continuing need for fiber optic and semiconductor manufacturers to improve their process efficiencies and yields through automation. We believe that these actions will help us emerge from this down-cycle stronger and better positioned to serve our customers by offering them products to meet their current and next-generation needs.'' |
