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Technology Stocks : MKS Instruments, Inc. (MKSI) -- Ignore unavailable to you. Want to Upgrade?

To: John Finley who wrote (60)	2/6/2001 11:10:20 PM
From: kinkblot	Read Replies (1) \| Respond to of 104

Notes on Conference Call Q & A Most responses were from John Bertucci. Q: How do you see margins improving, benefiting from integration of ASTeX? -- several percentage points to ASTeX business by implementing MKS' "lean manufacturing" technology Q: Longer-term gross margin target? -- projection for next year is 42-44% -- shooting for 45-6% gross margins for the combined company -- a higher proportion of integrated solutions (now 10+%) will lead to higher margins Q: When can we expect selling leverage from more complete solutions? -- typical time horizon for new product development: 12-18 months Q: "I was wondering if you could give us some color" on customers' inventory situation... -- "most of the OEM's inventories have been held in better control than we've seen in past growth cycles" -- just-in-time portion of sales is approximately 40-42% (includes most of Applied business) Q: What's the "tenor of business from OEMs in January?" -- can't comment on particular customers; semiconductor portion is "almost an index for the industy"; however, due to thin film and other, which are growing faster at the moment, overall doesn't track exactly Q: "What holes in your product portfolio would you like to fill?" -- "Well, we like the instruments business. And we like products that fit with the idea of integrated subsystems and improving productivity of the [semiconductor and thin film] manufacturing tools." Q: Can you please give us some color on 'technology buys' (as opposed to 'capacity buys'); where are you seeing the strongest growth, say copper interconnects, .13 microns, or 300mm? -- "Many of our instruments cover a wide range of those product areas, so it's difficult for us to distinguish one technology from another in our broad demand." -- 300mm is difficult to distinguish, since many products could be for any of 200mm, 200-300mm bridge, or 300mm, but "there's certainly activity in that area." -- among specialty products, high density plasma etch and CVD are particularly strong Larry Linton of Secondline Capital asked a couple of detailed questions: Q: "Did I understand Ron's comments correctly in that you're basically looking for industry growth of minus 5 to plus 5 percent and you're also using those type of numbers for MKS's overall revenues this year. If that's so: in the past you've spoken about being able to grow faster than the industry and on top of that this acquisition would allow you to start to get some enhancements this year and certainly going forward. Do I understand that correctly, and is there an element of conservatism there? -- "Well, there's certainly an element of uncertainty, and that leads to conservatism. Yes." Q: Is your market share in terms of [Applied's] demand for your products much higher than it is with other vendors, or are you equally weighted towards Applied Materials and others in terms of your market share within their product lines? -- Until 1994, for historical reasons, much higher with AMAT than other OEMs. Convergence since then in terms of market share with other major OEMs. "The market share with their competitors is a blended share because there are still older systems that are being shipped, but certainly of the more recent designs we have pretty much the same share across the board with most OEMs, including Applied." corporate-ir.net This expression "could you give us some color" is already getting on my nerves and I've only heard it a few times. WT