AMAT related story from today:
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Dow Jones Newswires -- October 20, 1997 3:33 PM
Applied Science Puts 1Q Net At 21c-23c/Shr On 3c Gain
WOBURN, Mass. (Dow Jones)--Applied Science & Technology Inc. (ASTX) will
report Tuesday that fiscal first quarter earnings were between 21 cents and 23 a
share, including a three-cent gain on the sale of an investment, Chief Executive
Officer Richard S. Post told Dow Jones News Service.
Excluding the gain, Applied Science's earnings will either meet or slightly exceed
First Call consensus analysts' estimates of 18 cents a share. Post said the
company's revenues for the quarter ended Sept. 27 will be about $17.4 million. In
the year-ago fiscal first quarter, Applied Science reported net income of
$311,915, or 7 cents a share, on revenues of $9.8 million.
Applied Science makes components used to manufacture advanced memory
devices and microprocessors such as Pentium and PowerPC chips. Its
components are also used for medical applications such as magnetic resonance
imaging and surgical instrument sterilization. Post, who is also Applied Science's
chairman and president, said the company's improved results reflect a rebound in
the semiconductor industry and a broadening of the firm's product line.
For example, Post said, its CPI unit, which makes customized power supplies for
semiconductor capital equipment and medical and industrial lasers, contributed
$3.5 million in revenues to Applied Science for the quarter. Applied Science
acquired CPI from its parent company, ILC Technology Inc., in May for $6.35
million in cash plus 45,000 common shares of Applied Science.
"We're still in the process of improving CPI, but the bulk of this (quarter's)
improvement is in the overall business," Post said. He said there was strong
demand for microwave and radio frequency generators and microwave plasma
sources for photoresist stripping, passivation, etching, thin-film deposition and
surface cleaning - all steps used in the manufacture of semiconductors. Post
said 60% of the company's business comes from the semiconductor business.
Applied Science relies on one semiconductor capital-equipment company,
Applied Materials Inc. (AMAT), for 35% of its revenues. Post said Applied
Materials used to make up 55% of Applied Science's revenues, and he believes
Applied Science's dependence on industry-leading Applied Materials is an
advantage. "It's great to have the world's leader as your major customer," Post
said. "Applied Materials always gains market share in a downturn."
Post believes Applied Science's share price will be less volatile going forward. In
Nasdaq Stock Market trading, the firm's stock traded for as low as $9 in March,
spiked to more than $28 earlier this month and is now trading around $23. Post
attributed the gyrations to the relative illiquidity of shares, but said the issuance
of 1 million new shares in recent months by redeeming warrants should redress
the liquidity problem. The additional shares also increased the company's market
capitalization to more than $100 million - a milestone, Post said, for attracting
capital from mutual-fund managers.
Applied Science's revenues have grown 55% a year for the past three fiscal
years, and Post, like most chief executives, believes his company's value has not
been appreciated by the market. He expects that to change. "As people look at
value," he said, "they'll see a nice picture" at Applied Sciences. |
