Cymer Announces First Quarter Financial Results for 1998
SAN DIEGO, CALIF. - April 23, 1998 - Cymer Inc. <NASDAQ: CYMI>, the world's leading supplier of excimer laser illumination sources essential for deep ultraviolet (DUV)photolithography, today reported financial results for the quarter ended March 31, 1998.
Revenues for the quarter increased to $49,679,000 as compared to revenues of $36,971,000 for the quarter ended March 31, 1997. Net income for the first quarter of 1998 was $2,703,000, or $0.09 per share (diluted), compared to net income of $4,408,000 or $0.14 per share (diluted), for the first quarter of 1997. On a sequential basis, revenues and net income for the quarter declined as compared to fourth quarter 1997 revenues of $59,076,000, and net income of $7,173,000, or $0.24 per share (diluted).
Backlog at March 31, 1998 was $90,915,000. Cash, cash equivalents and short and long-term investments totaled $166,922,000. Working capital totaled $175,909,000, while capital spending declined to $5,719,000 for the quarter as compared to $11,622,000 for the fourth quarter of 1997.
"Our first quarter 1998 revenues and net income were as expected given the current market conditions," said Robert Akins, president and chief executive officer of Cymer. "The ongoing DRAM supply imbalance, coupled with the economic conditions in Japan and Asia, affected overall demand, holding down chipmakers' spending for capital equipment. This resulted in a 15 percent decline in product sales on a sequential quarterly basis. This decline and the related reduced capacity utilization produced gross margins of 38.3 percent for the quarter versus 40.0 percent for the fourth quarter of 1997. In addition, expenses for sales and marketing and research and development increased 6 percent and 3 percent respectively over the prior quarter, due in part to the new product introduction of the ELS-5010 Krypton Fluoride (KrF) excimer laser."
Mr. Akins continued, "We remain confident in the future rebound of the market and are focused on ensuring Cymer's competitive edge going forward." The ELS-5010 KrF laser, integrated with the newest steppers and scanners, delivers chipmakers substantially improved performance (providing larger depth of focus and improved dosage accuracy), while at the same time reducing manufacturing cost-per wafer-layer explained Akins. "We believe the 5010 together with our next-generation KrF laser, the "Orion", which we plan to ship in the third quarter raises the competitive bar and further solidifies our market leadership position. Pushing KrF laser sources to their limits is especially critical to enabling higher resolution as evidenced by the announcement last week by SEMATECH, Photronics, National Semiconductor and MicroUnity, which used a Cymer KrF laser in their achievement of 0.10 micron critical dimensions."
"The current market conditions are expected to continue for the next few quarters," cautioned Akins. "Based on information currently available to us, we expect total revenues for the second quarter of 1998 to be comparable to those of the first quarter of this year. However, costs of product sales are expected to increase due to production costs associated with the introduction of new laser models. In anticipation of the future upturn in the market, we expect to maintain our current aggressive level of investment in our R & D programs and will continue to enhance our global infrastructure to support both stepper manufacturers and chipmakers around the world. These expenditures, coupled with the anticipated reduction in gross margins mentioned above, are currently expected to result in lower earnings for the second quarter of 1998 as compared to the first quarter."
Forward Looking Statements
Statements in this press release regarding the effects of Cymer's new products on its competition, new product introduction schedules, anticipated market conditions and revenue, spending and earnings projections are forward looking statements, are based on current expectations and involve a number of risks and uncertainties. Actual results may differ materially from those projected in any such statements due to various factors, including: the demand for semiconductors in general, and, in particular, for leading-edge devices with smaller geometries; changing business and economic conditions in various geographic regions, including Asia, and the effect of these conditions on capital spending plans by the Company's customers and end-users; the rate at which semiconductor manufacturers take delivery of photolithography tools from the Company's customers, which in turn may be affected by delays and cancellations of new factory construction; the timing of customer orders, shipments, and acceptances; the effect of recent price increases instituted by the Company on new orders; new and enhanced product offerings by competitors; the Company's ability to meet its production goals; and failure by the Company to match expense levels with revenue fluctuations.
Corporate Profile
Cymer, Inc. is the world's leading supplier of excimer laser illumination sources, the essential light source for deep ultraviolet (DUV) photolithography systems. DUV lithography is a key enabling technology which has allowed the semiconductor industry to meet the exact specifications and manufacturing requirements for volume production of today's advanced semiconductor chips. Further information on Cymer may be obtained from the Company's SEC filings, the Internet at cymer.com or by contacting the Company directly.
Analyst Contact:
William Angus, III
Senior Vice President and CFO
619-451-7300
619-618-3090 (Fax)
Media Contact:
Marie C. Burke
Director, Investor Relations
Cymer, Inc.
619-618-5232
619-618-3090 (Fax)
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cymer.com
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