Lam Research Corporation Announces Earnings for the Quarter Ended September 28, 2003
Wednesday October 15, 4:24 pm ET
biz.yahoo.com
"There are early signs that demand for wafer processing equipment is improving," stated James W. Bagley, Lam's chairman and chief executive officer. "Our orders this quarter are indicative of an improved market environment as well as our improved market position."
FREMONT, Calif.--(BUSINESS WIRE)--Oct. 15, 2003--Lam Research Corporation (Nasdaq:LRCX - News) today announced earnings for the quarter ended September 28, 2003. Revenue for the September 2003 quarter was $183.7 million, and net income was $4.8 million, or $0.04 per diluted share, compared to revenue of $186.1 million and net income of $3.7 million, or $0.03 per diluted share, for the June 2003 quarter.
The Company believes the presentation of ongoing results, which excludes certain special items, is useful for analyzing the business because it enables comparisons for ongoing operations by removing the effects of expense recognition connected with our outsourcing strategy and consolidation. Tables that provide reconciliations of ongoing results to results under Generally Accepted Accounting Principles (GAAP) are included. Ongoing net income in the September 2003 quarter was $5.4 million, or $0.04 per diluted share, versus ongoing net income of $2.5 million, or $0.02 per diluted share, for the June 2003 quarter.
Gross margin and operating expenses calculated according to GAAP for the September 2003 quarter were $78.5 million and $73.6 million, respectively. Ongoing gross margin for the September 2003 quarter was $78.3 million, or 42.6 percent of revenue, which represents an improvement of 1.5 percentage points when compared to the previous quarter, while ongoing operating expenses declined to $72.5 million sequentially. Favorable utilization of factory and field infrastructure contributed to the improved performance, reflecting continued execution of our outsourcing initiatives.
New orders of approximately $211 million in the September 2003 quarter represent 10 percent sequential growth, continuing the positive momentum started early in the calendar year. The geographic distribution of new orders as well as revenue is shown in the following table:
Region New Orders Revenue
--------- ------------ ----------
North America 11% 26%
Europe 16% 25%
Japan 7% 7%
Asia Pacific 66% 42%
Production output for the period was approximately $158 million. As of September 28, 2003, deferred revenue and profit were $46.9 million and $28.4 million, respectively, and backlog was $291.4 million.
Total cash (cash equivalents, short-term investments, and restricted cash) increased by $17.1 million to $642.9 million at the end of the September quarter, due primarily to the exercise of employee stock options.
"There are early signs that demand for wafer processing equipment is improving," stated James W. Bagley, Lam's chairman and chief executive officer. "Our orders this quarter are indicative of an improved market environment as well as our improved market position."
"Since September 2001, we have been evolving our new business model. This new model, coupled with a competitive portfolio of products and services, should enable us to expand profitability over the course of the entire industry cycle," Bagley concluded.
Statements made in this press release which are not statements of historical fact are forward-looking statements and are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relate, but are not limited, to the future demand for wafer processing equipment, the impact of Lam's new business model and the Company's future profitability.
Such statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed with the Securities and Exchange Commission, including specifically the report on Form 10-K for the year ended June 29, 2003, which could cause actual results to vary from expectations. The Company undertakes no obligation to update the information or statements made in this press release.
Lam Research Corporation is a leading supplier of wafer processing equipment and services to the worldwide semiconductor manufacturing industry. The Company's common stock trades on the Nasdaq National Market under the symbol "LRCX." Lam's World Wide Web address is lamrc.com.
Consolidated Financial Tables to Follow
Reconciliation of US GAAP Net Income to Ongoing Net Income
(in thousands, except per share data and percentages)
Three Months Ended
September 28, June 29,
2003 2003
------------- -----------
U.S. GAAP net income $4,786 $3,699
Pre-tax restructuring recoveries - cost
of goods sold (250) (663)
Pre-tax net restructuring charges -
operating expenses 1,062 9,805
Tax benefit on net restructuring charges (203) (2,286)
Other net tax benefits -- (8,097)
------------- -----------
Ongoing net income $5,395 $2,458
============= ===========
Ongoing net income per diluted share $ 0.04 $ 0.02
============= ===========
Number of shares used for diluted per
share calculation 134,886 131,420
Income tax rate 25% 25%
Reconciliation of US GAAP Gross Margin, Operating Expenses and
Operating Income (Loss) to Ongoing Gross Margin, Operating
Expenses and Operating Income
(in thousands)
Three Months Ended
September 28, June 29,
2003 2003
------------- -----------
U.S. GAAP gross margin $78,518 $77,124
Restructuring recoveries - cost of
goods sold (250) (663)
------------- -----------
Ongoing gross margin $78,268 $76,461
U.S. GAAP operating expenses $73,581 $84,697
Net restructuring charges - operating
expenses (1,062) (9,805)
------------- -----------
Ongoing operating expenses $72,519 $74,892
------------- -----------
Ongoing operating income $ 5,749 $ 1,569
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LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data and percentages)
Three Months Ended
September 28, June 29, September 29,
2003 2003 2002
------------ ----------- --------------
(unaudited) (unaudited) (unaudited)
Total revenue $183,738 $186,086 $197,520
Cost and expenses:
Cost of goods sold 105,470 109,625 118,526
Cost of goods sold -
restructuring recoveries (250) (663) --
------------ ----------- --------------
Total cost of goods
sold 105,220 108,962 118,526
Gross margin 78,518 77,124 78,994
Gross margin as a
percent of revenue 42.7% 41.4% 40.0%
Research and development 38,526 40,391 41,382
Selling, general and
administrative 33,993 34,501 33,359
Restructuring charges, net 1,062 9,805 --
------------ ----------- --------------
Total operating
expenses 73,581 84,697 74,741
Operating income (loss) 4,937 (7,573) 4,253
Other income (expense):
Loss on equity derivative
contracts in Lam stock -- -- (16,407)
Other income (expense), net 1,444 1,710 (662)
------------ ----------- --------------
Income (loss) before income
taxes 6,381 (5,863) (12,816)
Income tax expense (benefit) 1,595 (9,562) 898
------------ ----------- --------------
Net income (loss) $ 4,786 $ 3,699 $(13,714)
============ =========== ==============
Net income (loss) per share:
Basic $ 0.04 $ 0.03 $ (0.11)
============ =========== ==============
Diluted (1) $ 0.04 $ 0.03 $ (0.11)
============ =========== ==============
Number of shares used in
per share calculations:
Basic 128,351 126,872 126,931
============ =========== ==============
Diluted (1) 134,886 131,420 126,931
============ =========== ==============
(1) For the three-month period ended September 28, 2003, diluted
net income per share includes the assumed exercise of employee stock
options and outstanding warrant, but excludes the assumed conversion
of the convertible subordinated 4% notes because the effect would have
been antidilutive. For the three-month period ended June 29, 2003,
diluted net income per share includes the assumed exercise of employee
stock options, but excludes the assumed conversion of the outstanding
warrant and convertible subordinated 4% notes because the effect would
have been antidilutive. Outstanding options, warrant, and convertible
subordinated 4% and 5% notes for the three-month period ended
September 29, 2002, were excluded from the computations of diluted net
loss per share because the effects would have been antidilutive due to
the net loss for the period.
LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
September 28, June 29,
2003 2003
(unaudited) (1)
------------ -----------
Assets:
Cash, cash equivalents and short-term
investments $ 524,472 $ 507,413
Accounts receivable, net 113,975 107,602
Inventories 102,274 112,016
Other current assets 151,331 145,745
------------ -----------
Total current assets 892,052 872,776
Property and equipment, net 43,371 48,771
Restricted cash 118,468 118,468
Other assets 152,211 158,260
------------ -----------
Total assets $1,206,102 $1,198,275
============ ===========
Liabilities and stockholders' equity:
Other current liabilities $ 203,680 $ 216,982
------------ -----------
Total current liabilities 203,680 216,982
Long-term debt and other liabilities 325,239 332,209
Stockholders' equity 677,183 649,084
Total liabilities and
------------ -----------
stockholders' equity $1,206,102 $1,198,275
============ ===========
(1) Derived from audited financial statements
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Contact:
Lam Research Corporation
Kathleen Bela, 510-572-4566 (Investor Relations)
kathleen.bela@lamrc.com
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Source: Lam Research Corporation |
