Lam Research Corporation Announces Results for the Quarter Ended December 30, 2001
FREMONT, Calif.--(BUSINESS WIRE)--Jan. 24, 2002--Lam Research Corporation (Nasdaq:LRCX - news) today announced financial results for the quarter ended December 30, 2001.
Revenues of $259.2 million were 24 percent lower than the quarter ended September 23, 2001. The net loss for the quarter was $51.7 million, or $0.41 per diluted share, compared to a net loss of $8.9 million, or $0.07 per diluted share, in the September 2001 quarter.
The net loss for the December 2001 quarter included inventory write-downs for excess, obsolete, and older-generation products of approximately $24.1 million, a patent litigation settlement charge of $38.8 million, impaired asset write-downs of approximately $9.5 million for laboratory and demonstration equipment, restructuring charges of $33.8 million, and a non-operating gain on the revaluation of the Company's derivative instruments of $18.9 million. The after-tax effects of these adjustments were reductions of $55.4 million in net income, or $0.44 per diluted share. Excluding these items, net income would have been $3.7 million, or $0.03 per diluted share. An income tax rate of 30 percent is expected on fiscal year 2002 results. The ``Analysis of Operating Statement Items'' attachment to this press release provides an analysis of operating statement charges.
New orders of approximately $124 million were about 10 percent below the previous quarter. Regional distribution of new orders for the quarter was as follows: North America, 39 percent; Europe, 17 percent; Japan, 10 percent; and Asia Pacific, 34 percent.
Revenues for the quarter were distributed as follows: North America, 27 percent; Europe, 22 percent; Japan, 21 percent; and Asia Pacific, 30 percent. Shipments for the quarter were approximately $99 million.
Gross margin for the December 2001 quarter was $26.6 million or 10 percent of revenue. Excluding the inventory charge of approximately $24.1 million and the patent litigation settlement charge of $38.8 million, gross margin was approximately $89.5 million or 34.5 percent of revenue. This result compares to a gross margin of 37 percent in the September 2001 quarter, excluding the $7.6 million restructuring charge in that quarter.
Research and Development and Selling, General, and Administrative expenses were $44.4 million and $39.3 million, respectively, after excluding the approximately $9.5 million impaired asset write-downs. This total of $83.7 million in operating expenses compares to $94.4 million in operating expenses for the September 2001 quarter, excluding special charges. The $10.7 million decrease is the result of cost-reduction programs previously announced.
Cash, Short-term Investments, and Restricted Cash amounted to $941 million at the end of the quarter with Cash and Short-term Investments totaling $880.1 million and Restricted Cash totaling $60.8 million.
``We resized the company to be better aligned with current market conditions and are implementing outsourcing initiatives to reduce the fixed cost component of our business model,'' stated James W. Bagley, chairman and chief executive officer. ``While the business environment in the wafer fab equipment industry remained challenging in the December quarter, we are seeing the first signs of improvement, which will be reflected in higher bookings and shipment levels in the March quarter,'' 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 future market conditions, the prospective demand for and positioning of the Company's products, bookings and shipment projections, the benefits of cost-reduction and outsourcing activities, the impact of current initiatives on the Company's operational and financial performance, and the possibility of future growth in the wafer fab equipment industry. Such statements are based on current expectations and are subject to risks, 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 24, 2001, and the Form 10-Q for the quarter ended September 23, 2001, 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.
LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended Six Months Ended
Dec 30, Dec 24, Dec 30, Dec 24,
2001 2000 2001 2000
---------- ---------- ---------- ----------
(unaudited) (restated (unaudited) (restated
and and
unaudited) unaudited)
Total revenue $259,173 $384,097 $598,753 $689,128
Cost and expenses:
Cost of goods sold 193,745 214,066 407,614 386,429
Cost of goods sold
- restructuring
charges -- -- 7,600 --
Cost of goods sold
- Varian
settlement 38,780 -- 38,780 --
---------- ---------- ---------- ----------
Gross margin 26,648 170,031 144,759 302,699
Research and
development 49,734 58,722 96,964 115,253
Selling, general,
and administrative 43,524 61,996 90,689 114,432
Restructuring
charges 33,773 -- 47,221 --
Purchased
technology for
research and
development -- 8,000 -- 8,000
---------- ---------- ---------- ----------
Operating income
(loss) (100,383) 41,313 (90,115) 65,014
Other income
(expense):
Gain on equity
derivative contracts
in Lam stock 18,884 -- 890 --
Other income
(expense), net (386) 2,926 (571) 7,566
---------- ---------- ---------- ----------
Income (loss) before
income tax expense (81,885) 44,239 (89,796) 72,580
Income tax expense
(benefit) (30,230) 13,270 (29,221) 21,771
---------- ---------- ---------- ----------
Income (loss) before
cumulative effect of
change in accounting
principle (51,655) 30,969 (60,575) 50,809
Cumulative effect of
the application of
SAB 101, "Revenue
Recognition in
Financial
Statements",
net of $81,441
related tax benefit -- -- -- (122,105)
---------- ---------- ---------- ----------
Net income (loss) $(51,655) $30,969 $(60,575) $(71,296)
========== ========== ========== ==========
Net income (loss)
per share:
Basic
Income (loss)
before
cumulative
effect of change
in accounting
principle $(0.41) $0.25 $(0.48) $0.41
Cumulative effect
of change in
accounting
principle,
application of
SAB 101 $ -- $ -- $ -- $(0.99)
---------- ---------- ---------- ----------
Basic net income
(loss) per share $(0.41) $0.25 $(0.48) $(0.58)
========== ========== ========== ==========
Diluted
Income (loss)
before cumulative
effect of change
in accounting
principle $(0.41) $0.24 $(0.48) $0.38
Cumulative effect
of change in
accounting
principle,
application of
SAB 101 $ -- $ -- $ -- $(0.92)
---------- ---------- ---------- ----------
Diluted net
income (loss)
per share $(0.41) $0.24 $(0.48) $(0.54)
========== ========== ========== ==========
Number of shares
used in per share
calculation
Basic 125,674 123,420 125,507 123,949
========== ========== ========== ==========
Diluted 125,674 130,392 125,507 132,063
========== ========== ========== ==========
LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
December 30, June 24,
2001 2001
(unaudited) (1)
---------- ----------
Assets:
Cash and short-term investments $880,134 $864,559
Accounts receivable, net 133,268 248,910
Inventories 185,629 284,757
Other current assets 244,251 178,380
---------- ----------
Total current assets 1,443,282 1,576,606
Property and equipment, net 85,510 126,533
Restricted cash 60,800 60,800
Other assets 74,369 107,836
---------- ----------
Total assets $1,663,961 $1,871,775
========== ==========
Liabilities and stockholders' equity:
5% convertible debenture $309,763 $ --
Other current liabilities 315,717 499,684
---------- ----------
Total current liabilities 625,480 499,684
5% convertible debenture -- 309,763
Other long-term debt and liabilities 357,984 349,955
Stockholders' equity 680,497 712,373
Total liabilities and
stockholders' equity $1,663,961 $1,871,775
========== ==========
(1) Derived from audited financial statements
Lam Research Corporation
Analysis of Operating Statement Items
(In millions, except per share data)
Three months ended Three months ended
Dec. 30, 2001 Sep. 23, 2001
Income/ Income/
(loss) per (loss) per
Amount diluted Amount diluted
share share
Net income/(loss) reported $ (51.7) $ (0.41) $ (8.9) $ (0.07)
Operating statement
adjustments:
(1) Excess and obsolete
inventory charge
included in cost of
goods sold 24.1
(2) Patent litigation
settlement charge
included in cost of
goods sold 38.8
(3) Restructuring charges
included in cost of
goods sold 7.6
(4) Impaired asset
write-downs included in
operating expense 9.5
(5) Restructuring charges
included in operating
expense 33.8 13.4
(6) (Gain)/loss on equity
derivative contracts
in Lam stock(2) included
in other
income/expense (18.9) 18.0
---------- ----------
Subtotal of adjustments 87.3 39.0
Income tax benefit (31.9) (2.1)
-------- --------
--------------- ----------------
Net income after adjustments $ 3.7 $ 0.03 $ 28.0 $ 0.21
======== ========
=============== ================
Income tax rate 30% 10%
(2) Note: There is no tax effect associated with the equity
derivative. |
