PRI Automation Streamlines Operations to Focus on Next-Generation Automation Solutions; Company Reconfirms Financial Guidance and Announces Special Charges
Reorganization Intended to Allow Company to Maintain Leadership Position In Advanced Systems and Software That Improve Semiconductor Factory Productivity
BILLERICA, Mass., Sept. 10 /PRNewswire/ -- PRI Automation, Inc. (Nasdaq: PRIA - news; Toronto: PRJ - news), a global leader in advanced automation systems, software and services for the semiconductor industry, announced today a reorganization designed to enhance the company's ability to provide its customers with integrated systems that improve semiconductor factory (fab) productivity as well as reduce PRI's own operating expenses. The company also reconfirmed its financial guidance and announced that it will take special charges in its fiscal fourth quarter ending September 30, 2001.
Reorganization to allow PRI to focus on its two core customer segments:
semiconductor manufacturers and semiconductor equipment vendors
To better take advantage of its expertise in integrated solutions for the
entire fab, PRI will reorganize into two customer-focused divisions:
Automation Systems which will serve the total automation needs of
semiconductor manufacturers and OEM Systems which will serve the
wafer-handling automation requirements of semiconductor capital equipment
suppliers.
According to PRI President and CEO Mitch Tyson, the reorganization responds in large part to customer requests for one-stop shopping. ``PRI's customers are looking for one supplier that can provide integrated solutions that optimize fab productivity yet are flexible and easy to install. They increasingly want to outsource their automation requirements -- and due to the depth and breadth of our solutions, PRI is well suited to meet that need.'' Two well-known semiconductor manufacturers have already contracted with PRI for integrated fab automation systems, spanning material handling, lithography automation, software, consulting and support.
Brad Lawrence, a 30-year veteran with electronics and capital goods suppliers who joined PRI earlier this year to run its Factory Systems group, will serve as vice president and general manager of PRI's new Automation Systems Division. The Division encompasses Automated Material Handling Systems (AMHS); Lithography Automation Systems; and Factory Management Software, plus automation integration, consulting and support services. According to Lawrence, ``Consolidating these operating units into one division will enhance PRI's ability to deliver integrated solutions that increase fab-wide productivity, while at the same time improve our own operating efficiency.''
PRI's OEM Systems Division, headed by Vice President and General Manager Robert de Neve, a 20-year semiconductor industry veteran, develops and markets tool automation systems and software to semiconductor equipment vendors around the world. The OEM Systems Division is the leading worldwide supplier of atmospheric wafer-handling systems with more than 70 percent CY 2000 market share according to Gartner/Dataquest. In response to equipment vendors' desire to outsource more of their automation needs, PRI's OEM Systems Division is also developing a full line of Integrated Front End products, which combine tool interfaces, robotics, mini-environments and software, and that will be required on process tools in 300mm wafer semiconductor fabs.
PRI continues to invest in new products in anticipation of industry recovery
``PRI continues to invest in new product development for 300mm wafer fabs in order to be poised for growth when the industry upturn occurs,'' said Tyson. ``We believe that PRI provides the broadest range of integrated equipment, software and services solutions to automate these new factories.'' Tyson added that PRI plans to announce new 300mm automation systems in the first two quarters of fiscal 2002, and that those systems have been designed for better performance at a lower manufacturing cost.
PRI reconfirms financial guidance, announces special charges
PRI expects that total revenue for its fiscal fourth quarter 2001, before the implementation of SAB 101, will be approximately $60 million to $65 million, in line with previous guidance. The company expects that its pro-forma loss before special charges and before implementation of SAB 101 will also be in line with previous guidance, at approximately $0.39 to $0.45 per share.
PRI expects to take special charges of approximately $15 million to $20 million in its fiscal fourth quarter to cover costs including facilities consolidation and severance costs related to the reorganization; provisions for warranty and contract losses; and excess and obsolete inventory reserves primarily related to product discontinuances at its Factory Systems Division.
The above represents PRI's current best estimate of its fourth quarter financial performance. As set forth below under ``Safe Harbor Statement,'' there can be no assurance that the company's actual results will conform to these estimates. PRI expects to announce final results for the fourth quarter and fiscal year ending September 30, 2001 on or about November 20, 2001.
Reorganization positions PRI for increased market share and profitable growth
``Clearly the industry downturn has created a tumultuous environment for semiconductor capital equipment companies such as PRI,'' said Tyson. ``However, PRI has seen fewer cancellations and pushouts in the fourth quarter of fiscal 2001 to date than we saw in the previous quarter, which could indicate that the industry may be bottoming out. That said, we expect business to be flat for the next several quarters, and we're aligning costs accordingly. This reorganization is designed to enable PRI to reduce operating costs while continuing to invest in new product development and programs that we believe will position us for increased market share and profitable growth in the next upturn. We are taking full advantage of this slow period to work closely with our customers, complete our next-generation products, strengthen our outsourcing relationships and ready our manufacturing operations for efficient, high-volume manufacturing.''
About PRI Automation
PRI Automation, Inc., headquartered in Billerica, Massachusetts, is a leading global supplier of advanced factory automation systems, software, and services that optimize the productivity of semiconductor and precision electronics manufacturers as well as OEM process tool manufacturers. PRI is the only company to provide a tightly integrated and flexible hardware and software solution that optimizes the flow of products, data, materials and resources throughout the production chain. The company has thousands of systems installed at approximately one hundred locations throughout the world. For more information, visit PRI online at pria.com .
Safe Harbor Statement
This release includes forward-looking statements, including, without limitation, statements relating to the expected impact of our restructuring on our operations and expenses, the benefits to customers of our products and services, our future ability to take advantage of an industry upturn, if any, our plans to announce new products, and our expected levels of revenue and results of operations (including special charges) for the current fiscal quarter. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. The revenue and EPS ranges and special charges described above represent PRI's best estimate of its fourth quarter financial performance, based on currently available information and assumptions that PRI believes to be reasonable. However, there can be no assurance that the company's actual results will conform to these estimates. The company's ability to predict the amount and mix of its revenues during the current market downturn is limited, and its software and OEM businesses in particular are characterized by short lead times and little, if any, backlog. The company is also continuing to evaluate both the effects of SAB 101, which may result in the deferral of revenue that would otherwise have been recognized in the fourth quarter, and also the amount and composition of the special charges for the fourth quarter. PRI expects to announce final results for the fourth quarter and fiscal year ending September 30, 2001 on or about November 20, 2001. Other risks and uncertainties include: the manner in which the customer uses our products and integrates them with third-party components; the downturn in the semiconductor capital equipment industry is harming our business; fluctuating demand for our products makes it difficult to manage our business efficiently; we have reduced our workforce in response to the industry downturn and reduced demand for our products and our smaller workforce may be inadequate to handle increased demand for our products; we may continue to experience delays and technical difficulties with new product introductions such as our TurboStocker product; 300mm technology, in which we have invested heavily, is being adopted more slowly than we expected and competition for early 300mm orders is intense; our lengthy sales cycle makes it difficult to anticipate sales; our operating results fluctuate significantly in response to a variety of factors; delay in our shipment of a single significant order could substantially decrease our sales for a period; the application of new accounting guidance under SAB 101 will result in delayed recognition of revenues from our factory automation systems; we typically charge a fixed price for our factory automation systems and therefore, we are vulnerable to cost overruns; we have a limited number of customers, we do not have long-term purchase agreements with our customers, and the loss, cancellation or delay of an order by any of these customers could harm our business; we must continually improve our technology and develop new products to remain competitive; demand for less expensive semiconductors is increasing pressure to reduce our prices; industry consolidation and outsourcing could reduce the number of available customers; our operations outside North America expose us to special risks of doing business internationally; our investments in the Asia-Pacific market may not be successful; we face significant competition from other automation companies; future acquisitions may disrupt our operations; we are increasingly dependent on subcontractors and one or a few suppliers of certain components, subassemblies and manufacturing processes; the failure of our key suppliers to deliver components on time could harm our business; we depend on our executive officers and other key personnel; our software products may contain defects that could result in claims and harm our business; we may be unable to protect our proprietary technology; others might claim that we infringe their technology; rising energy costs may increase our operating expenses; we are subject to pending class action securities litigation that could be costly to defend, divert the attention of our management and, if determined adversely to us, seriously harm our business; and other factors identified in our registration statement on Form S-3, file number 333-60180, filed with the SEC on May 3, 2001. We assume no obligation to update any forward-looking statements included in this release.
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SOURCE: PRI Automation, Inc. |
