SAN JOSE, Calif.--(BUSINESS WIRE)--April 20, 1998--Novellus
Systems Inc. (Nasdaq NM: NVLS) Monday reported net sales and results
of operations for its first quarter ended March 28, 1998.
Net sales for the quarter were $163.2 million, an increase of 61
percent over first quarter 1997 net sales of $101.7 million. Net
income of $21 million or $0.60 per share was recorded for the quarter,
an increase of 35 percent compared with the first quarter 1997 net
income of $15.6 million or $0.46 per share. The per share amounts are
stated on a diluted basis and are adjusted for the 2-for-1 split that
was announced on Sept. 22, 1997,and was effective on Oct. 13, 1997.
Cash and short term investments at March 28, 1998,were $100.7
million, up 3 percent over year-end 1997 balances of $98.1 million.
Bookings fell short of achieving a 1:1 book to bill ratio for the
first quarter of 1998.
Robert Smith, executive vice president and chief financial
officer,noted: "While Novellus experienced an expected slowdown in
new orders and sequentially flat net sales over the prior quarter, we
were pleased that we were able to generate a positive cash flow during
the quarter. With the current uncertainty surrounding the
semiconductor capital equipment industry, we will continue to control
S,G&A expenditures and prudently manage assets while continuing our
strong commitment to invest in research and development."
Richard Hill, chairman and chief executive officer,said: "Given
the current industry-wide slowdown, I am pleased with our results of
sequentially flat net sales for the quarter. As the slowdown
continues, however, I am cautious in my expectations for net sales and
net income over the next two quarters."
"The long-term growth potential for the thin film deposition
market continues to be good. In the short term, however, our new
product developments will have to help dampen the effect of the
slowdown. Fortunately, our patented SPEED High Density Plasma (HDP)
solution for sub-0.35 micron inter-metal dielectric applications has
attained a reputation for high reliability, superior film quality and
cost of ownership performance since its introduction in 1996.
"The market leadership of SPEED has been extended by our recent
announcement of a unique fluorine-doped process for advanced logic
devices in production. Our engineers and scientists have not stopped
there as we have expanded the SPEED product into the Shallow Trench
Isolation (STI) market, demonstrating the cost-effective fill of 0.12
micron trenches at five-to-one aspect ratios. Our Concept Two Sequel
continues to expand its process portfolio as well, with the
introduction of PEARL, a plasma-enhanced anti-reflective layer
targeted at extending i-line and deep UV lithography.
"Our PVD acquisition completed in June 1997 has also contributed
to our success. Our new INOVA platform has been seen to produce
superior advanced barrier and aluminum fill capability for sub-0.35
micron geometries.
"Going forward, our continuing commitment to investment in new
product development will be a key for providing growth for our
company's shareholders and customers. At Semicon West in July,
Novellus will introduce advanced products to enable the transition to
dual damascene copper processing, maintaining our position as the
industry innovation leader."
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995: The statements regarding (i) the uncertainty
surrounding the semiconductor capital equipment industry, (ii) the
company's ability to control certain expenditures, (iii) the long-term
growth prospects for the thin film deposition market, (iv) the
company's ability to lead market transitions in sub-0.35 micron and
dual damascene copper processing, (v) the anticipated growth resulting
from investment in new product development, (vi) the introduction of
dual damascene copper processing products, and (vii) the company's
ability to continue to invest in new product development, as well as
other matters discussed in the news release that are not purely
historical data, are forward-looking statements.
The forward-looking statements involve risks and uncertainties,
including, but not limited to, a possible continuing slowdown in new
orders and the inability of the company's product development efforts
to continue its position as an industry leader in deposition
technologies, and other risks indicated in filings with the Securities
and Exchange Commission (SEC). Actual results may differ materially.
Novellus assumes no obligation to update this information. For more
details, refer to Novellus' SEC filings, including its most recent
Annual Report on Form 10-K and quarterly reports on Form 10-Q.
Novellus Systems manufactures, markets, and services advanced
automated wafer fabrication systems for the deposition of thin films.
Novellus deposition systems are designed for high-volume production of
advanced semiconductors at the lowest overall cost. The company's
stock trades on the Nasdaq Stock Market's National Market under the
symbol "NVLS". Additional information about the company is available
on the Novellus Systems home page on the World Wide Web, located at
novellus.com.
*T
NOVELLUS SYSTEMS INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
Three Months Ended
March 28, March 29,
1998 1997
Net Sales $163,214 $101,628
Cost of Sales 73,283 45,732
Gross Profit 89,931 55,896
Operating Expenses
Research and Development 30,872 16,842
Selling, General and
Administrative 27,348 17,531
Total Operating Expenses 58,220 34,373
Income from Operations 31,711 21,523
Interest Income, Net 31 2,133
Income before Income Taxes 31,742 23,656
Provision for Income Taxes 10,792 8,043
Net Income $ 20,950 $ 15,613
Basic Net Income (Loss)
Per Share $ 0.62 $ 0.48
Diluted Net Income (Loss)
Per Share $ 0.60 $ 0.46
Shares Used in Basic
Calculation 33,816 32,760
Shares Used in Diluted
Calculation 34,857 34,274
Note: The earnings per share amounts have been adjusted for the
2-for-1 split effective October 1997.
NOVELLUS SYSTEMS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March 28, Dec. 31,
1998 1997
Assets
Current Assets:
Cash and Short-Term Investments $100,660 $ 98,089
Accounts Receivable, Net 183,396 133,925
Inventories 84,924 82,133
Deferred Taxes and Other Current
Assets 37,588 36,862
Total Current Assets 406,568 351,009
Property and Equipment, Net 99,671 93,340
Other Assets 47,353 48,951
Total Assets $553,592 $493,300
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts Payable $ 52,857 $ 22,865
Short-Term Obligations 11,643 11,652
Other Accrued Liabilities 99,721 92,782
Total Current Liabilities 164,221 127,299
Long Term Debt 65,000 65,000
Total Liabilities 229,221 192,299
Shareholders' Equity:
Common Stock 157,271 154,167
Retained Earnings and
Accumulated Other Comprehensive
Income 167,100 146,834
Total Shareholders' Equity 324,371 301,001
Total Liabilities and Shareholders'
Equity $553,592 $493,300
*T
CONTACT: Novellus Systems Inc., San Jose
Robert Smith, 408/943-9700
KEYWORD: CALIFORNIA
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED EARNINGS
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