Applied Materials Announces Results for First Fiscal Quarter 2002
New Orders of $1.1 Billion
Net Sales of $1.0 Billion
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SANTA CLARA, Calif.--(BUSINESS WIRE)--Feb. 12, 2002--Applied Materials, Inc., the world's largest supplier of wafer fabrication solutions to the semiconductor industry, reported results for its first fiscal quarter ended January 27, 2002. Net sales were $1.0 billion, down 21 percent from $1.26 billion for the fourth fiscal quarter of 2001, and down 58 percent from $2.36 billion for the first fiscal quarter of 2001. Ongoing net income (which excludes one-time items) for the first fiscal quarter of 2002 was $15 million, or $0.02 per diluted share, down 34 percent from $22 million, or $0.03 per diluted share, for the fourth fiscal quarter of 2001, and down 97 percent from $424 million, or $0.50 per diluted share, for the first fiscal quarter of 2001. One-time items for the first fiscal quarter of 2002 consisted of pre-tax charges of $77 million in connection with the restructuring previously announced on December 12, 2001, primarily for employee severance and facilities realignment, and $8 million for acquired in-process research and development. The reported net loss for the first fiscal quarter of 2002 was $45 million, or $0.06 per share, compared to a net loss of $82 million, or $0.10 per share, for the fourth fiscal quarter of 2001, and net income of $157 million, or $0.19 per diluted share, for the first fiscal quarter of 2001.
New orders of $1.12 billion for the first fiscal quarter of 2002 were slightly higher than the $1.10 billion reported in the fourth fiscal quarter of 2001, and decreased 54 percent from $2.43 billion for the first fiscal quarter of 2001. Regional distribution of new orders for the first fiscal quarter of 2002 was: Taiwan 27 percent, Southeast Asia and China 25 percent, North America 22 percent, Europe 15 percent, Japan 6 percent and Korea 5 percent. Backlog at the end of the first fiscal quarter of 2002 decreased to $2.68 billion, from $2.73 billion at the end of the fourth fiscal quarter of 2001.
Gross margin for the first fiscal quarter of 2002 was 38.5 percent, compared to 37.1 percent for the fourth fiscal quarter of 2001 and 48.4 percent for the first fiscal quarter of 2001. Ongoing net income as a percentage of net sales was 1.5 percent for the first fiscal quarter of 2002, down from 1.8 percent for the fourth fiscal quarter of 2001 and 18.0 percent for the first fiscal quarter of 2001.
``We are pleased with our results this quarter and that our financial position remained strong, with cash and investments now totaling $4.9 billion. Throughout this extremely difficult industry environment, Applied Materials has continued to invest in the critical new technologies our customers need for advanced chip designs using copper and nanometer-sized circuits, as well as the move to 300mm wafers. While we believe that industry conditions remain challenging in the short-term, we are somewhat encouraged by orders for the new technologies. Our strong product momentum and enhanced global infrastructure reinforce Applied Materials' leadership and strategically position the Company to gain market share as the industry recovers,'' said James C. Morgan, chairman and chief executive officer.
This press release contains certain forward-looking statements, including, but not limited to, those relating to the Company's strategic position and the semiconductor industry's outlook. These forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to: the Company's ability to timely align its cost structure with market conditions; the length and severity of the economic and industry downturn; global uncertainties; changes in demand for semiconductors and customer capacity requirements, including capacity utilizing the latest technology; changes in the timing and amount of customers' investments in new technology; the successful and timely development of new markets, products, processes and services and other risks described in Applied Materials' filings with the Securities and Exchange Commission. The Company assumes no obligation to update the information in this press release.
Applied Materials will be discussing its first fiscal quarter results, along with its outlook for the second fiscal quarter of 2002, on a conference call today beginning at 1:30 p.m. Pacific Time. A webcast of the conference call will be available on Applied Materials' Web site under the ``Investors'' section.
Applied Materials (Nasdaq: AMAT - news), the largest supplier of products and services to the global semiconductor industry, is one of the world's leading information infrastructure providers. Applied Materials enables Information for Everyone(TM) by helping semiconductor manufacturers produce more powerful, portable and affordable chips.
Applied Materials' Web site is appliedmaterials.com.
APPLIED MATERIALS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
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Three Months Ended
(In thousands, except January 28, January 27,
per share amounts) 2001 2002
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Net sales $2,363,254 $1,000,460
Cost of products sold 1,220,508 615,008
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Gross margin 1,142,746 385,452
Operating expenses:
Research, development
and engineering 336,312 246,799
Marketing and selling 143,457 83,804
General and administrative 102,349 70,043
Non-recurring items(1) - 85,479
---------- ----------
Income/(loss) from operations 560,628 (100,673)
Interest expense 12,375 11,991
Interest income 59,138 48,132
---------- ----------
Income/(loss) before income taxes and
cumulative effect of change in
accounting principle 607,391 (64,532)
Provision/(benefit) for income taxes 183,167 (19,037)
---------- ----------
Income/(loss) before cumulative effect
of change in accounting principle 424,224 (45,495)
Cumulative effect of change in
accounting principle, net of tax (267,399) -
---------- ----------
Net income/(loss) $ 156,825 $ (45,495)
---------- ----------
Earnings/(loss) per share:
Basic-continuing operations $ 0.52 $ (0.06)
Basic-cumulative effect of change
in accounting principle (0.33) -
---------- ----------
Total basic $ 0.19 $ (0.06)
---------- ----------
Diluted-continuing operations $ 0.50 $ (0.06)
Diluted-cumulative effect of change
in accounting principle (0.31) -
---------- ----------
Total diluted $ 0.19 $ (0.06)
---------- ----------
Weighted average number of shares:
Basic 810,437 818,209
Diluted 844,893 818,209
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(1) The Company's reported results of operations for the first fiscal
quarter of 2002 included: 1) a pre-tax restructuring charge of $77
million for employee-related costs, consolidation of facilities
and other costs in connection with the restructuring previously
announced on December 12, 2001; and 2) a pre-tax charge of $8
million for acquired in-process research and development
associated with the acquisitions of Schlumberger's electron-beam
wafer inspection business and Global Knowledge Services, Inc.
These non-recurring charges totaled $0.08 per share after tax for
the first fiscal quarter of 2002.
APPLIED MATERIALS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS(2)
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October 28, January 27,
(In thousands) 2001 2002
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ASSETS
Current assets:
Cash and cash equivalents $1,356,304 $1,101,435
Short-term investments 3,485,088 3,786,852
Accounts receivable, net 776,451 777,582
Inventories 1,412,997 1,259,915
Deferred income taxes 551,785 551,958
Other current assets 199,549 232,929
---------- ----------
Total current assets 7,782,174 7,710,671
Property, plant and equipment, net 1,706,488 1,682,344
Other assets 339,848 417,138
---------- ----------
Total assets $9,828,510 $9,810,153
---------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ - $ 60,606
Current portion of long-term debt 4,807 4,370
Accounts payable and
accrued expenses 1,477,531 1,310,528
Income taxes payable 50,478 133,700
---------- ----------
Total current liabilities 1,532,816 1,509,204
Long-term debt 564,805 562,321
Deferred income taxes and
other liabilities 124,152 121,411
---------- ----------
Total liabilities 2,221,773 2,192,936
---------- ----------
Stockholders' equity:
Common stock 8,158 8,199
Additional paid-in capital 1,881,124 1,960,409
Retained earnings 5,693,010 5,647,515
Accumulated other comprehensive
income/(loss) 24,445 1,094
---------- ----------
Total stockholders' equity 7,606,737 7,617,217
---------- ----------
Total liabilities and
stockholders' equity $9,828,510 $9,810,153
----------------------------------------------------------------------
(2) Amounts as of January 27, 2002 are unaudited. Amounts as of
October 28, 2001 are from the October 28, 2001 audited financial
statements.
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Contact:
Applied Materials, Inc.
Carolyn Schwartz, 408/748-5227 (investment community)
Jeffrey Lettes, 408/563-5161 (editorial/media) |
