CREE
Thursday April 15, 4:01 pm Eastern Time
Company Press Release
SOURCE: Cree Research, Inc.
Cree Research Third Quarter Net Income Rises 92%;
Product Revenue Increases 58%
DURHAM, N.C., April 15 /PRNewswire/ -- Cree Research, Inc. (Nasdaq: CREE - news) today reported record revenue of $16,035,000
for the third quarter ended March 28, 1999, a 50 percent increase over the $10,671,000 reported in the year ago period. Product
revenue grew 58 percent to $14,084,000 over the $8,929,000 reported in the comparable quarter a year ago. Net income grew 92
percent to $3,377,000, or $0.23 per share, from the $1,755,000, or $0.13 per share, reported in the year ago period. During the quarter
the company took a combined charge of $486,000 in write-downs related to leasehold improvements and government contract
funding limitations. In February, the company completed a public offering of 1,495,000 shares of common stock. These additional
shares were not dilutive as additional interest income offset the impact of the additional shares.
For the nine month period, the company reported record revenue of $42,352,000 compared to $30,983,000 representing a 37 percent
increase over the year ago period. Product revenue increased 49 percent to $37,609,000 over the $25,298,000 reported for the
comparable period a year ago. Net income rose 95 percent to $8,594,000, or $0.61 per share, and compares with net income of
$4,396,000, or $0.33 per share, for the corresponding period.
In commenting on the third quarter, Neal Hunter, Chairman and CEO said, ''In addition to achieving record results in the third
quarter, we continue to position Cree toward accelerated growth. We've recently been recognized as the world's largest producer of
nitride-based LEDs, and the proceeds raised from our secondary public offering will enable us to expand our operations and execute
our growth objectives.''
North Carolina based Cree Research, Inc. is the world leader in developing and manufacturing semiconductor materials and electronic
devices made from silicon carbide. The company uses proprietary technology to make enabling compound semiconductors such as
blue and green LEDs, SiC crystals used in the production of unique gemstones and SiC wafers that are sold for research. Cree has
new product initiatives based on its expertise in SiC, including microwave transistors for use in wireless base stations and radar, blue
laser diodes for optical storage applications and high power devices for power conditioning and switching. For more information on
Cree visit cree.com .
This press release contains forward-looking statements involving risks and uncertainties that may cause actual results to differ
materially from those indicated. Actual results could differ materially from those contained in the forward-looking statements due to a
number of factors, including fluctuations in the company's operating results, variations in production yields in the company's
manufacturing processes, whether the company can develop improved processes to manufacture high brightness blue and green
LEDs in commercial quantities and at low unit cost, whether the company can develop improved products to meet new product
offerings by competitors, the effect of price competition, the company's dependence on few customers, whether the company can
manage growth effectively, assertion of intellectual property rights by others and adverse changes in economic conditions in the
company's markets, as well as other factors discussed in the company's report on Form 10-K for the year ended June 28, 1998,
subsequent quarterly reports and the company's registration statement on Form S-3 dated January 14, 1999, all as filed with the
Securities and Exchange Commission.
CREE RESEARCH, INC.
FINANCIAL STATEMENT HIGHLIGHTS
(in thousands, except per share data)
Three Months Ended Nine Months Ended
3/28/99 3/29/98 3/28/99 3/29/98
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Product Revenue $ 14,084 $ 8,929 $ 37,609 $ 25,298
Contract Revenue 1,951 1,742 4,743 5,685
Total Revenue 16,035 10,671 42,352 30,983
Cost of Product
Sales 6,794 5,510 18,586 15,875
Cost of Contract
Sales 1,503 1,430 3,755 4,679
Total Cost of Sales 8,297 6,940 22,341 20,554
Gross Profit 7,738 3,731 20,011 10,429
Operating Expenses 3,394 1,439 8,556 4,736
Net Interest Income 347 180 482 513
Income Before Income
Taxes 4,691 2,472 11,937 6,206
Income Taxes 1,314 717 3,343 1,810
Net Income 3,377 1,755 8,594 4,396
Net Income Per Share
(if dilutive) $ 0.23 $ 0.13 $ 0.61 $ 0.33
Weighted Average Shares of Common
Stock Outstanding,
dilutive 14,885 13,501 13,989 13,515
Balance Sheet Highlights
3/28/99 6/28/98
(Unaudited)
Current Assets $ 72,289 $ 34,658
Total Assets 131,462 72,724
Current Liabilities 7,861 7,055
Long Term Debt -- 8,650
Shareholder's Equity $ 121,124 $ 54,865
SOURCE: Cree Research, Inc.
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