Etec Systems Resets Outlook for Remainder of Fiscal 1999
Projects Q3 Loss and Announces Reduction in Workforce
HAYWARD, Calif.--(BUSINESS WIRE)--March 30, 1999--Etec Systems, Inc. (Nasdaq:ETEC - news), a leader in patterning solutions for the worldwide semiconductor industry, today announced that its outlook has changed for the remainder of fiscal 1999.
As a result, the company estimates that revenues for its third fiscal quarter, ending April 30,1999 will be approximately $55-60 million. Etec simultaneously announced a workforce reduction of approximately 90 employees, or approximately 8% of its Semiconductor Products Group workforce at its locations in Hayward, California and Hillsboro, Oregon. The company will take a non-recurring charge that will result in the company reporting a loss for its third fiscal quarter.
Etec will incur approximately $14 million in miscellaneous one-time charges in the third quarter of fiscal 1999, including charges related to inventory write-offs, the impairment of certain assets, and the reduction in workforce. In addition, the company's research and development costs in the third quarter of fiscal 1999 may be approximately $1.0 million higher than in the second quarter of fiscal 1999. As a result, an estimated loss of $0.35 to $0.45 per diluted share is expected to be incurred for the third fiscal quarter of 1999. Net income without these one-time charges would have been approximately $0.10 per diluted share. The company believes that fiscal fourth quarter 1999 revenues will likely be in the same range as the third quarter, which would result in estimated fourth quarter earnings of approximately $0.10 to $0.15 per diluted share.
Steve Cooper, chairman, president and CEO of Etec stated, ''The pickup in orders that we saw in the second quarter has not continued. We believe this lower than expected unit demand is a result of the lingering effects of the worldwide semiconductor industry downturn and the effects of consolidation activities among our maskmaking customers. We also believe that maskmaking overcapacity exists in Taiwan and that difficulties in the Japanese semiconductor industry are limiting investment in maskmaking equipment in those regions. As a result of the overall industry environment, pattern generation system demand is unlikely to improve for the remainder of the fiscal year ending July 31,1999, and the market could be challenging through the remainder of the calendar year.''
Cooper continued, ''Though many industry market researchers and analysts are calling for a return to healthy growth in the maskmaking sector, we have yet to see a sustainable order pattern that would reflect an upturn. When this growth resumes, we are convinced that Etec's leading edge MEBES® 5000 and ALTA® 3500 products are well positioned to meet the maskmaking requirements for 0.25 micron devices and below. Good progress on developing our next generation electron-beam and laser-beam systems also positions us well for future device generations.''
Safe Harbor Under the Private Securities Litigation Reform Act of 1995: Except for historical information, the matters discussed in this news release are forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include risks associated with the timely development and market acceptance of new products in an environment of rapid technological change, reduced, postponed or canceled orders as a result of changes in customers' planned capital spending, timely availability of key components, delays in factory testing and acceptance, increased costs and manufacturing capacity associated with the addition of new facilities, ability of certain new customers to finance new system purchases, the possibility of new products or technologies introduced by competitors, and material variations in financial results due to a delay in delivery of even one system. Statements in this release are based upon internal estimates, preliminary information and management assumptions, which are subject to a number of risks and uncertainties inherent in estimating future results. Other risks are detailed from time to time in the Company's SEC reports, including the annual report filed on Form 10-K and subsequent filings on Form 10-Q. The Company assumes no obligation to update the information in this release.
About Etec: Etec Systems, Inc. is a leader in patterning solutions for the worldwide semiconductor and electronics industries. Its products include electron- and laser-beam systems that produce high-precision masks, which are used to print circuit patterns onto semiconductor wafers and high-speed, large-area laser direct imaging systems and e-beam test equipment for electronic interconnect and flat panel display production applications. Founded in 1970, the company is headquartered in Hayward, Calif., with manufacturing facilities in Hayward, Calif., Beaverton, Ore., Tucson, Ariz., and Feldkirchen, Germany, with sales and service offices worldwide. Etec's stock is traded on the Nasdaq Stock Market under the symbol ETEC. The Company's World Wide Web site can be accessed at www.etec.com. |
