Asyst Technologies Reports Third Quarter Results
Wednesday January 29, 4:09 pm ET
FREMONT, Calif.--(BUSINESS WIRE)--Jan. 29, 2003--Asyst Technologies, Inc., (Nasdaq:ASYT - News), a leading provider of integrated automation solutions that maximize the productivity of semiconductor manufacturing, today announced financial results for its third fiscal quarter ended Dec. 31, 2002. Results were in line with company guidance.
Results for the quarter include the results of Asyst-Shinko Inc., an AMHS joint venture (JV). The company completed the purchase of its 51% interest in the JV on October 16, 2002.
Third quarter consolidated net sales from continuing operations were $75.6 million, compared with $72.3 million in the prior sequential quarter. The JV contributed $24.1 million to net sales for the quarter, which was partially offset by the decline in Asyst's base business, consistent with the industry-wide downturn in demand for most semiconductor manufacturing products.
Consolidated gross margin was 25%, compared with 39% in the second fiscal quarter. The decline is attributable to the impact of Asyst-Shinko, whose AMHS business in the quarter provided lower gross margins; accelerated depreciation of manufacturing assets and other costs related to the company's transition to outsourced production; and lower sales volumes in Asyst's base business. Excluding the impact of Asyst-Shinko and the transition to outsourced manufacturing, gross margin was 34%.
GAAP results include one-time charges of $5.8 million for in-process research and development related to the acquisition of the Asyst-Shinko JV interest; $8.7 million for the impairment of acquired intangibles; and $2.2 million related to cost-cutting restructuring initiatives. Discontinued operations includes approximately $6.5 million of charges related to the writedown of net assets based on expected realized values. GAAP net loss from continuing operations was $(32.6 million), or $(0.86) per diluted share. Net loss including discontinued operations was $(40.9 million) or $(1.08) per share. Pro forma net loss from continuing operations was $(14.3 million), or $(0.38) per diluted share.
"After two quarters of outperformance, we were not immune to the industry forces that dragged down sales in the December quarter," said Steve Schwartz, chairman and CEO. "Fortunately, Asyst-Shinko remains a bright spot and has maintained its current revenue runrate over the past several quarters. China also has been a source of strength, as our 200mm SMIF and other products continue to be chosen by a factor of more than 10-to-1 over our competitors. This was offset by our lack of substantial participation in the very recent new DRAM fab activity in Korea, where we are working to improve our market position."
Mr. Schwartz continued, "We are encouraged by the recent increases in quote activity, particularly in Japan. We also see strategic investments in 300mm capacity continuing, which positions us well with our improved and refreshed 300mm offerings in all of our product lines. Although we continue to look for hard indicators of a sustainable upturn, we believe that the December quarter marked our near-term bottom for bookings, and that the March quarter will be our near-term bottom for sales."
Net bookings for the quarter were $48.3 million, compared with $50.2 million in the prior sequential quarter. Approximately $18.0 million of net bookings were attributable to Asyst-Shinko.
Cash Flow and Balance Sheet
As previously disclosed, during the third quarter the company established and drew-down a $25 million credit facility to support the purchase of its interest in Asyst-Shinko. In addition, Asyst received $20 million for certain inventory related to the outsourcing of production. The company paid approximately $67 million for its interest in Asyst-Shinko. Excluding the impact of these transactions and the quarterly results of Asyst-Shinko, but including all other sources and uses of cash, the company was cash flow positive $2 million for the quarter. Cash and short-term investments at quarter-end were $77.0 million, $18 million of which is for the exclusive use of the JV.
Of the company's long-term debt of $115.3 million as of Dec. 31, 2002, $86 million relates to 5.75% convertible debentures due 2008, convertible into common stock at $15.18 per share. Approximately $25 million is attributable to the new credit facility, and approximately $4 million is long-term asset-based debt held by Asyst Japan Inc. Short-term debt of $20.6 million is low-interest, asset-based revolving debt held by Asyst Japan Inc.
Outlook
For its fourth fiscal quarter ending March 2003, the company expects to report consolidated net sales from continuing operations of approximately $75 million. As stated previously, the company believes that its fourth fiscal quarter will mark the near-term bottom for its net sales.
Consolidated gross margin for the March quarter is expected to be in the range of 24 to 26%. The March quarter is expected to be the last quarter impacted by accelerated depreciation and other costs related to outsourcing of manufacturing.
As a result of cost reduction measures implemented in the third fiscal quarter as well as other ongoing cost reductions, consolidated operating expenses are expected to decline to the range of $29 to $30 million. In the March quarter, the company will disburse the $2.5 million semi-annual coupon payment on its convertible debenture and will continue to manage operations and its balance sheet to conserve cash. Asyst's ongoing objective is to drive its consolidated pro forma breakeven level toward the $85 million range.
Highlights
On January 8, Asyst announced that president and CEO Steve Schwartz had been named to the additional position of chairman of the board of directors.
On January 7, the company announced that Asyst-Shinko had won a multi-million order to install its AMHS system in SMIC Fab 3, the newest fab for Semiconductor Manufacturing International Corp. (SMIC) of China.
As part of its ongoing operational excellence initiatives, on December 15 Asyst announced that it had launched the initial implementation of its new on-line customer portal, the Asyst Order Fulfillment Center (OFC). OFC automates order fulfillment and tracking, giving global customers 24/7 access to their order information while ensuring that quality, timeliness and accuracy of customer deliveries are optimized.
On November 21, the company announced that it had won a significant production order for its G3 FOUP wafer carrier from a major manufacturer of raw 300mm wafers. This was Asyst's first FOUP order in the raw wafer market.
Pro Forma Adjustments: Pro forma adjustments include the impact of amortized acquisition-related stock-based compensation, the amortization of acquired intangible assets, in-process research and development costs of acquired businesses, impairment charges, restructuring charges, and discontinued operations.
About Asyst
Asyst Technologies, Inc. is a leading provider of integrated automation systems for the semiconductor manufacturing industry, which enable semiconductor manufacturers to increase their manufacturing productivity and protect their investment in silicon wafers during the manufacture of integrated circuits, or ICs. Encompassing isolation systems, work-in-process materials management, substrate-handling robotics, automated transport and loading systems, and connectivity automation software, Asyst's modular, interoperable solutions allow chipmakers and original equipment manufacturers, or OEMs, to select and employ the value-assured, hands-off manufacturing capabilities that best suit their needs. Asyst's homepage is asyst.com
Conference Call Details
A live webcast of the conference call to discuss the quarter's financial results will take place today at 5:00 p.m. Eastern Time. The webcast will be publicly available on Asyst's website at asyst.com. A replay of the Webcast may be accessed via the same address. In addition, a standard telephone instant replay of the conference call is available by dialing (303) 590-3000, followed by the passcode 521409. The audio instant replay is available from January 29 at 7:00 p.m. Eastern Time through February 12 at 11:59 p.m. Eastern Time.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995
Except for statements of historical fact, the statements in this press release are forward-looking. Such statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include, but are not limited to: the volatility of semiconductor industry cycles, inability to manage cash flows, failure to respond to rapid demand shifts, dependence on a few significant customers, the transition of the industry from 200mm wafers to 300mm wafers, risks associated with the acceptance of new products and product capabilities, competition in the semiconductor equipment industry, failure to efficiently integrate acquired companies, failure to retain employees, and other factors more fully detailed in the company's annual report on Form 10-K for the year ended March 31, 2002, and Form 10-Q for the period ended Sept. 30, 2002, filed with the Securities and Exchange Commission.
ASYST TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands)
Dec 31, Sept 30, March 31,
2002 2002 2002
---------- ---------- ----------
ASSETS
Current assets:
Cash and cash equivalents $ 59,633 $ 61,604 $ 74,577
Restricted cash equivalents and
short-term investments 3,336 4,228 5,052
Short-term investments 14,000 14,000 5,000
Accounts receivable, net 93,696 48,987 28,307
Inventories 16,269 29,364 39,296
Deferred tax asset 576 - 33,906
Prepaid expenses and other
current assets 10,656 9,970 14,618
--------- --------- ---------
Total current assets 198,166 168,153 200,756
--------- --------- ---------
Long-term assets:
Property and equipment, net 33,256 32,232 34,399
Deferred tax asset - - 30,294
Intangible assets, net 128,108 35,677 29,901
Other assets, net 21,678 21,742 32,180
Assets of discontinued operations 8,985 15,372 16,885
--------- --------- ---------
Total long-term assets 192,027 105,023 143,659
--------- --------- ---------
Total Assets $ 390,193 $ 273,176 $ 344,415
========= ========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term loans $ 20,557 $ 19,389 $ 16,707
Current portion of long-term debt
and finance leases 1,199 1,128 1,076
Accounts payable 44,029 11,504 9,193
Accrued liabilities and other 54,820 36,144 46,819
Deferred revenue 4,430 6,360 4,367
--------- --------- ---------
Total current liabilities 125,035 74,525 78,162
--------- --------- ---------
Long-term liabilities:
Long-term debt and finance leases,
net of current portion 115,297 90,257 90,331
Other long-term liabilities 11,433 46 6,795
Liabilities of discontinued
operations 2,990 4,327 4,190
--------- --------- ---------
Total long-term liabilities 129,720 94,630 101,316
--------- --------- ---------
Minority interest 64,946 - -
Shareholders' equity:
Common Stock 327,248 325,965 294,316
Retained earnings (deficit) (256,756) (221,944) (129,379)
--------- --------- ---------
Total shareholders' equity 70,492 104,021 164,937
--------- --------- ---------
$ 390,193 $ 273,176 $ 344,415
========= ========= =========
ASYST TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; in thousands, except per share data)
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
12/31/2002 12/31/2001 12/31/2002 12/31/2001
--------------------------------------------
Net sales $ 75,624 $ 35,631 $ 199,807 $ 147,461
Cost of sales 56,495 39,411 135,955 119,762
---------- ---------- ---------- -----------
Gross profit 19,129 (3,780) 63,852 27,699
---------- ---------- ---------- -----------
Operating expenses:
Research and development 11,160 9,224 31,510 30,276
Selling, general and
administrative 20,462 18,020 54,346 59,996
Amortization of acquired
intangible assets 5,707 2,329 9,273 5,980
One-time charges 10,917 28,494 22,538 48,574
In-process research and
development costs of
acquired business 5,750 - 7,834 2,000
---------- ---------- ---------- -----------
Total operating
expenses 53,996 58,067 125,501 146,826
---------- ---------- ---------- -----------
Operating income (loss) (34,867) (61,847) (61,649) (119,127)
Other income (expense),
net (2,578) (1,081) (5,228) (1,644)
---------- ---------- ---------- -----------
Income (loss) before
provision (benefit) for
income taxes (37,445) (62,928) (66,877) (120,771)
Provision (benefit) for
income taxes - (14,459) 58,628 (33,490)
Minority interests (4,824) - (4,824) -
---------- ---------- ---------- -----------
Net income (loss)
Continuing Operations $(32,621) $(48,469) $(120,681) $ (87,281)
========== ========== ========== ===========
Discontinued Operations,
net of income tax (8,300) (41,379) (11,753) (48,462)
---------- ---------- ---------- -----------
Net income (loss) $(40,921) $(89,848) $(132,434) $(135,743)
========== ========== ========== ===========
Basic and diluted loss
per common share:
Continuing operations $(0.86) $(1.37) $(3.23) $(2.48)
Discontinued operations (0.22) (1.17) (0.32) (1.37)
---------- ---------- ---------- -----------
Net loss $(1.08) $(2.54) $(3.55) $(3.85)
========== ========== ========== ===========
Weighted average number of
common shares outstanding
- basic and diluted 37,932 35,419 37,316 35,237
========== ========== ========== ===========
ASYST TECHNOLOGIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; in thousands, except per share data)
Three Months
Ended Pro Forma Pro Forma
12/31/2002 Adjustments Results
------------------------------------
Net sales $ 75,624 $ 75,624
Cost of sales 56,495 (17) 56,478
----------- ---------
Gross profit 19,129 19,146
----------- ---------
Operating expenses:
Research and development 11,160 (233) 10,927
Selling, general and
administrative 20,462 (401) 20,061
Amortization of acquired
intangible assets 5,707 (5,707) -
One-time charges 10,917 (10,917) -
In-process research and
development costs of acquired
business 5,750 (5,750) -
----------- ----------
Total operating expenses 53,996 30,988
----------- ---------
Operating income (loss) (34,867) (11,842)
Other income (expense), net (2,578) (2,578)
----------- ---------
Income (loss) before provision
(benefit) for income taxes (37,445) (14,420)
Provision (benefit) for income
taxes - -
Minority interests (4,824) 4,749 (75)
----------- ---------
Net income (loss) Continuing
Operations $ (32,621) $ (14,345)
=========== =========
Discontinued Operations, net of
income tax (8,300) 8,300 -
----------- ----------
Net income (loss) $ (40,921) $ (14,345)
=========== =========
Basic and diluted loss per common share:
Continuing operations $ (0.86) $ (0.38)
Discontinued operations (0.22) -
----------- ----------
Net loss $ (1.08) $ (0.38)
=========== =========
Weighted average number of common
shares outstanding - basic and
diluted 37,932 37,932
=========== =========
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Contact:
Asyst Technologies, Inc
John Swenson, 510/661-5000
jswenson@asyst.com
or
Guerrant Associates
Laura Guerrant, 808/882-1467
lguerrant@guerrantir.com
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Source: Asyst Technologies, Inc. |
