SAN DIEGO, Feb. 11, 2009 (GLOBE NEWSWIRE) -- Cymer, Inc. (Nasdaq:CYMI), the world's leading supplier of light sources used by chipmakers to create advanced semiconductor chips, today announced operating results for the fourth quarter and year ended December 31, 2008.
For the fourth quarter of 2008:
* net income totaled $3,984,000, equal to $0.13 per share (diluted), compared to net income of $21,437,000, equal to $0.67 per share (diluted) in the fourth quarter of 2007 and net income of $5,331,000*, equal to $0.18* per share (diluted), in the third quarter of 2008. * revenue totaled $100,448,000, compared to revenue of $139,922,000 in the fourth quarter of 2007 and revenue of $110,619,000* in the third quarter of 2008.
For the year ended December 31, 2008:
* net income totaled $36,540,000, equal to $1.22 per share (diluted), compared to net income of $88,362,000, equal to $2.50 per share (diluted), for the year ended December 31, 2007. * revenue totaled $459,010,000, compared to revenue of $521,696,000 in the prior year.
Commenting on the fourth quarter results, Bob Akins, Cymer's chief executive officer, said, "Cymer employees executed well in a very difficult business environment. Our operating results were generally in line with our fourth quarter guidance. We extended our argon fluoride (ArF) immersion market leadership and made continued progress towards the development and commercialization of our extreme ultraviolet (EUV) light source technology."
In the fourth quarter of 2008, the company shipped 19 light sources, including 15 XLRs, resulting in an average selling price (ASP) of approximately $1.9 million. Installed Base Products (IBP) revenue totaled $63.2 million. During the quarter, the company installed 15 light sources at chipmaker locations. The company reported gross profit on product sales of $44.7 million, yielding a 44.5 percent gross margin. Fourth quarter 2008 cost of revenues included additional field inventory charges of approximately $2.3 million in response to lower chipmaker utilization. Excluding the additional field inventory charge, non-GAAP gross margin would have been 46.8 percent. Operating expenses of $40.3 million included $1.9 million of costs associated with the November 2008 reduction in workforce and a $1.9 million additional allowance for doubtful accounts receivable related to certain customer's deteriorating financial condition. Operating income totaled $4.4 million, and the fourth quarter effective tax rate was approximately 5%, primarily due to the passage of the federal research and development tax credit in October 2008 which was effective retroactively to January 1, 2008.
Deep ultraviolet (DUV) bookings for the fourth quarter of 2008 totaled $83.7 million, resulting in a book-to-bill ratio of 0.83. All of the light source systems bookings in the fourth quarter were XLR. The company ended the quarter with a DUV backlog of approximately $33.7 million, with ArF immersion light sources comprising approximately 84 percent of the value of systems in backlog.
For the full year 2008, the company shipped a total of 100 light sources, including 48 XLRs for advanced chip making applications. Cymer's full year revenue, at $459 million, was down 12 percent from 2007. Higher average selling prices, driven by the strong adoption of the XL Series of products, and approximately 10 percent annual growth in IBP revenue helped offset the decline in lithography light source demand. Through increased operational efficiency and XL platform reliability improvements, the company achieved a gross margin of 47.3 percent on product sales in 2008.
During the fourth quarter, the company increased cash and investments by approximately $16 million, and at December 31, 2008, cash and investments totaled $293 million. The company anticipates repaying its $140.7 million convertible note when it matures on February 15, 2009.
Corporate Outlook
Commenting on the outlook, Akins stated, "The current business environment is quite uncertain, characterized by shrinking lithography tool demand, and decreasing chipmaker factory utilization in the second half of 2008. Looking at the first quarter of 2009, demand for new light sources and installed base products has declined further since our mid January preliminary revenue estimate. It is noteworthy that utilization of our light sources held steady for the month of January in all three chip sectors. While visibility into 2009 is extremely limited, our expectation for the year is for advanced ArF immersion orders to continue to represent the vast majority of scanner and light source demand. We have taken action to reduce Cymer's cost structure, and we will continue to focus on maintaining operating costs in-line with business conditions. We feel Cymer is well positioned for the future with our strong DUV, EUV, Installed Base Products and TCZ portfolio."
Based on information available at this time, Cymer is currently providing the following guidance for the first quarter of 2009, and anticipates:
* Revenue to decrease approximately 45%, plus or minus 5% compared to the revenue reported for the fourth quarter of 2008 * Foreign currency adjusted ASP to be approximately $ 1.6 million to $1.7 million due to the anticipated inclusion of some KrF shipments * Gross margin to be approximately 40%, plus or minus 3%, depending on revenue levels * R&D expenses to be approximately $18.5 million to $19 million * SG&A expenses to be approximately $11.5 million to $12 million * Charges related to the January 15, 2009 cost reduction actions to be approximately $4.5 million, with approximately 25% associated with cost of revenues and 75% attributable to operating expenses * Our estimated first quarter effective tax rate to be approximately 30%. This rate may vary significantly depending on the actual extent of loss before tax
Cymer's management will hold a conference call at 2:00 pm (PST) today, February 11, 2009, to discuss fourth quarter and 2008 operating results and first quarter 2009 guidance. This press release, the conference call and accompanying slides may be accessed on the investor relations page of the company's Web site at www.cymer.com.
Forward Looking Statements
Statements in this press release that are not strictly historical in nature are forward-looking statements. These statements include, but are not limited to statements regarding the company's ArF immersion market leadership, commercialization of EUV source technology, and the statements under the caption "Corporate Outlook" above. These statements are predictions based on current information and expectations and involve a number of risks and uncertainties. In addition, statements regarding backlog and book-to-bill ratios should not be read as predictions or projections of future performance. Actual events or results may differ materially from those projected in any of such statements due to various factors, including but not limited to: the demand for semiconductors in general, and, in particular, for leading-edge devices with smaller geometries; cyclicality in the market for semiconductor manufacturing equipment; the timing of customer orders, shipments and acceptances; delays or cancellations by customers of their orders, the performance and market acceptance of the company's new products or technologies; new and enhanced product offerings by competitors; the company's ability to meet its production and product development schedules; the rate at which semiconductor manufacturers adopt new technologies and purchase and take delivery of photolithography tools from the company's customers; the company's ability to secure adequate supplies of critical components for its advanced products; the company's ability to manage its expense levels and unanticipated expenses; the company's ability to achieve its forecasted gross margin; the company's ability to achieve forecasted savings from its cost reduction actions; the company's ability to align its cost structure with forecasted business levels; the company's ability to manage its foreign currency exposure; the performance and conditions in the United States and world financial markets; the policies and actions of the United States and other governments; and general economic conditions. For a discussion of these and other factors which may cause our actual events or results to differ from those projected, please refer to the company's most recent annual report on Form 10-K and quarterly reports on Form 10-Q, as well as other subsequent filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and the company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this press release.
About Cymer
Cymer, Inc. (Nasdaq:CYMI) is the market leader in developing light sources, used by chipmakers worldwide to pattern advanced semiconductor chips. Cymer's light sources have been widely adopted by the world's top chipmakers, and the company's installed base comprises more than 3,300 systems. Continuing its legacy of leadership, Cymer is currently pioneering the industry's transition to extreme ultraviolet lithography, the next viable step on the technology roadmap for the creation of smaller, faster chips. The company was founded and is headquartered in San Diego, Calif. and supports its customers from numerous offices around the globe. Cymer maintains a Web site to which it regularly posts press releases, Securities and Exchange Commission (SEC) report filings, and additional information about Cymer. Interested persons can also subscribe to automated e-mail alerts or RSS feeds. Please visit www.cymer.com.
Cymer, Inc. Three Months Ended Dec.31 Twelve Months Ended Dec.31
2008 2007 2008* 2007
------------------------------------------------------
Total
revenues $100,448,000 $139,922,000 $459,010,000 $521,696,000
Net income $3,984,000 $21,437,000 $36,540,000 $88,362,000
Diluted
earnings
per share $0.13 $0.67 $1.22 $2.50
Weighted
average
common shares
outstanding -
diluted 29,645,000 33,623,000 29,992,000 36,784,000
* Includes a correction of an immaterial error for the third quarter of 2008 related to foreign currency translation of our consolidated statements of income. This correction decreased revenue by $774,000, net income by $404,000 and earnings per share (diluted) by $0.01 for the three months ended September 30, 2008.
GROSS MARGIN NON-GAAP RESULTS
Amount Percent of
($ M's) Revenue
-----------------------
Q4 2008 Gross Margin GAAP $44.7 44.5%
Q4 2008 Additional Field Inventory Charge $2.3 2.3%
Q4 2008 Gross Margin Non-GAAP $47.0 46.8%
CYMER, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands, except per share data)
---------------------------------------------
For the three months For the twelve months
ended December 31, ended December 31,
-------------------------------------------
2008 2007 2008(b) 2007
Revenues $99,967 $139,296 $456,729 $517,980
Revenues - related party 481 626 2,281 3,716
-------- -------- -------- --------
Total revenues 100,448 139,922 459,010 521,696
-------- -------- -------- --------
COST OF REVENUES 55,749 72,596 241,881 260,280
-------- -------- -------- --------
GROSS PROFIT 44,699 67,326 217,129 261,416
-------- -------- -------- --------
OPERATING EXPENSES:
Research and development 25,192 21,082 96,464 81,842
Sales and marketing 5,673 6,568 24,039 26,163
General and
administrative 9,454 10,476 36,544 38,949
-------- -------- -------- --------
Total operating expenses 40,319 38,126 157,047 146,954
-------- -------- -------- --------
OPERATING INCOME 4,380 29,200 60,082 114,462
-------- -------- -------- --------
OTHER INCOME (EXPENSE):
Foreign currency exchange
gain (loss) - net (214) 69 (6,642) 2,025
Write-down of investment (206) -- (5,309) --
Interest and other income 1,123 3,824 8,845 20,074
Interest and other
expense (1,769) (1,902) (6,712) (6,709)
-------- -------- -------- --------
Total other income
(expense) - net (1,066) 1,991 (9,818) 15,390
-------- -------- -------- --------
INCOME BEFORE INCOME TAX
PROVISION AND MINORITY
INTEREST 3,314 31,191 50,264 129,852
-------- -------- -------- --------
INCOME TAX PROVISION 154 10,314 16,587 44,413
MINORITY INTEREST 824 560 2,863 2,923
-------- -------- -------- --------
NET INCOME $3,984 $21,437 $36,540 $88,362
======== ======== ======== ========
EARNINGS PER SHARE:
Basic earnings per share $0.13 $0.71 $1.22 $2.64
======== ======== ======== ========
Weighted average common
shares outstanding-basic 29,596 30,404 29,924 33,522
======== ======== ======== ========
Diluted earnings per
share $0.13 $0.67(a) $1.22 $2.50(a)
======== ======== ======== ========
Weighted average common
shares outstanding-
diluted 29,645 33,623(a) 29,992 36,784(a)
======== ======== ======== ========
(a)As a result of applying the if-converted method for calculating
diluted earnings per share for the three month and year ended
December 31, 2007, shares have been adjusted assuming conversion of
our 3.5% convertible subordinated notes, and net income has been
adjusted for an add back of related interest expense, net of tax.
Shares have been adjusted by 2.8 million for both the three months
and year ended December 31, 2007, and net income has been adjusted
by $948,000 and $3.7 million for the three months and year ended
December 31, 2007, respectively.
(b)Includes a correction of an immaterial error for the third quarter
of 2008 related to foreign currency translation of our consolidated
statements of income. This correction decreased revenue by
$774,000, net income by $404,000 and earnings per share (diluted)
by $0.01 for the three months ended September 30, 2008.
CYMER, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands, except share data)
---------------------------------------------------------------------
December 31, December 31,
---------------------------
2008 2007
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $252,391 $305,707
Short-term investments 30,900 22,355
Accounts receivable - net 64,296 91,875
Accounts receivable - related party 818 1,112
Inventories 194,746 129,757
Deferred and prepaid income taxes 46,886 42,147
Prepaid expenses and other assets 9,344 8,930
----------- -----------
Total current assets 599,381 601,883
PROPERTY AND EQUIPMENT - NET 114,390 116,725
LONG TERM INVESTMENTS 9,456 29,443
DEFERRED INCOME TAXES 29,168 19,272
GOODWILL - NET 8,833 8,833
INTANGIBLE ASSETS - NET 9,898 12,951
OTHER ASSETS 6,318 5,045
----------- -----------
TOTAL ASSETS $777,444 $794,152
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $15,003 $23,980
Accounts payable - related party 4,108 4,428
Accrued warranty 23,565 24,350
Accrued payroll and benefits 12,682 24,406
Accrued patents, royalties and other fees 3,795 3,303
Convertible subordinated notes 140,722 --
Income taxes payable 1,085 13,468
Deferred revenue 15,344 4,974
Accrued and other current liabilities 8,278 4,569
----------- -----------
Total current liabilities 224,582 103,478
CONVERTIBLE SUBORDINATED NOTES -- 140,722
INCOME TAXES PAYABLE 18,447 17,755
DEFERRED REVENUE -- 5,562
OTHER LIABILITIES 11,791 17,401
----------- -----------
Total liabilities 254,820 284,918
----------- -----------
MINORITY INTEREST 4,848 5,711
----------- -----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock - authorized 5,000,000
shares; $.001 par value, no shares
issued or outstanding -- --
Common stock - authorized 100,000,000
shares; $.001 par value, 42,461,000
shares issued and 29,609,000 shares
outstanding at December 31, 2008;
42,339,000 shares issued and 30,290,000
shares outstanding at December 31, 2007 42 42
Additional paid-in capital 586,539 579,711
Treasury stock at cost (12,852,000 and
12,049,000 common shares) at
December 31, 2008 and 2007, respectively (473,580) (450,704)
Accumulated other comprehensive
income (loss) (6,025) 214
Retained earnings 410,800 374,260
----------- -----------
Total stockholders' equity 517,776 503,523
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $777,444 $794,152
=========== ===========
CYMER, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In thousands)
---------------------------------------------------------------------
For the year
ended December 31,
---------------------------
2008 2007
OPERATING ACTIVITIES:
Net income $36,540 $88,362
Adjustments to reconcile net income to
net cash provided by (used in) operating
activities:
Depreciation and amortization 26,633 25,523
Stock based compensation 5,630 5,642
Minority interest (2,863) (2,923)
Provision for deferred income taxes (16,152) 3,408
Loss on disposal or impairment of
property and equipment 297 292
Write-down of investments 5,309 --
Change in assets and liabilities:
Accounts receivable - net 28,160 23,982
Accounts receivable - related party 294 (278)
Inventories (63,620) (25,461)
Prepaid expenses and other assets (2,414) (2,218)
Accounts payable (8,788) 5,269
Accounts payable - related party (320) (430)
Accrued and other liabilities (13,557) 185
Deferred income 4,909 7,992
Income taxes payable (11,234) 12,733
----------- -----------
Net cash provided by (used in)
operating activities (11,176) 142,078
----------- -----------
INVESTING ACTIVITIES:
Acquisition of property and equipment (23,689) (26,637)
Purchases of investments (90,309) (91,440)
Proceeds from sold or matured investments 95,051 256,720
Acquisition of patents -- (121)
----------- -----------
Net cash provided by (used in) investing
activities (18,947) 138,522
----------- -----------
FINANCING ACTIVITIES:
Proceeds from issuance of common stock 2,506 15,260
Cash investment received from minority
shareholder 2,000 2,000
Tax windfall from stock option exercises 58 1,727
Repurchase of common stock into treasury (22,876) (300,000)
----------- -----------
Net cash used in financing activities (18,312) (281,013)
----------- -----------
EFFECT OF EXCHANGE RATE CHANGES ON CASH
AND CASH EQUIVALENTS (4,881) 4,022
----------- -----------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS (53,316) 3,609
CASH AND CASH EQUIVALENTS AT BEGINNING
OF THE YEAR 305,707 302,098
----------- -----------
CASH AND CASH EQUIVALENTS AT END OF
THE YEAR $252,391 $305,707
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Interest paid $5,569 $5,469
=========== ===========
Income taxes paid, net $43,256 $26,642
=========== ===========