Cabot Microelectronics Corporation Reports Strong Results for Second Quarter of Fiscal 2015

• Revenue of $104.9 Million, 5.4 Percent Higher Than Last Year
• Gross Profit Margin of 52.1 Percent of Revenue, Up 530 Basis Points Year-Over-Year
• Earnings Per Share of 55 Cents, Up 37.5 Percent From Last Year

AURORA, Ill., April 30, 2015 (GLOBE NEWSWIRE) -- Cabot Microelectronics Corporation (Nasdaq:CCMP), the world's leading supplier of chemical mechanical planarization (CMP) polishing slurries and a growing CMP pad supplier to the semiconductor industry, today reported financial results for its second quarter of fiscal 2015, which ended March 31, 2015.

Total revenue during the second fiscal quarter was $104.9 million, 5.4 percent higher than the same quarter last year. Gross profit margin was 52.1 percent of revenue in the second fiscal quarter, which is 530 basis points higher than in the same quarter last year. The company also achieved diluted earnings per share of $0.55, representing an increase of 37.5 percent compared to the same quarter last year. Cash flow from operations was $27.0 million. As of March 31, 2015, the company's cash balance net of debt outstanding was $165.2 million.

"Our results highlight another quarter of strong financial performance for our company. The March quarter traditionally has been a seasonally weak quarter for us and we are pleased with these results, which include year-over-year revenue growth in a number of our key product areas, meaningful expansion of our gross profit margin, and a significant increase in earnings," said David Li, President and CEO of Cabot Microelectronics. "During the quarter we continued to make progress on the commercialization of our new family of high performing Dielectrics slurry products, which we believe can be a key growth driver for us. We are encouraged by the level of customer sampling and evaluation of these innovative solutions, and have received a number of positive initial reactions to product performance. Additionally, we are proud to have earned Intel's most prestigious award for suppliers, the Supplier Continuous Quality Improvement Award, for the third consecutive year for our performance in 2014."

Mr. Li continued, "Looking ahead, some of our customers and industry reports are calling for softer semiconductor industry conditions during the June quarter compared to the March quarter. Through the first month of our third fiscal quarter we have also seen some softness in demand for our CMP consumables products. However, we are confident that we can continue to successfully manage our business over a range of demand environments, and believe that we are well positioned for the future."

Key Financial Information

Total second fiscal quarter revenue of $104.9 million represents a 5.4 percent increase from the $99.5 million reported in the same quarter last year. Revenue from the company's CMP slurries for polishing tungsten, slurries for polishing other metals, CMP polishing pads and Engineered Surface Finishes product area all increased compared to the same quarter last year. Revenue from slurries for dielectrics and data storage applications decreased. Foreign exchange effects reduced revenue by $1.4 million year-over-year, primarily due to the weaker Japanese yen versus the U.S. dollar. Revenue for the first half of the fiscal year totaled $216.8 million, which is 8.4 percent higher than last year. Year to date revenue includes a $2.5 million adverse impact associated with foreign exchange rate changes, primarily the weaker Japanese yen.

Gross profit, expressed as a percentage of revenue, was 52.1 percent this quarter, which is 530 basis points higher than the 46.8 percent of revenue reported in the same quarter a year ago. Gross profit percentage increased primarily due to product mix, the absence of an asset impairment charge recorded during the same quarter last year, and benefits associated with foreign exchange rate changes, partially offset by higher accruals for incentive compensation. Year to date, gross profit was 51.5 percent of revenue, which represents a 440 basis point improvement over the first half of last year. Taking into account the company's results in the first half of the fiscal year, and in light of the prospect of softer near term demand, the company currently expects its gross profit for the full fiscal year to be around the upper end of its guidance range of 48 to 50 percent of revenue.

Operating expenses, which include research, development and technical, selling and marketing, and general and administrative expenses, were $35.2 million in the second fiscal quarter, or $3.3 million higher than the $31.9 million reported in the same quarter a year ago, primarily due to higher accruals for incentive compensation and costs associated with the company's CEO transition announced last December. Year to date, total operating expenses were $69.6 million, or 8.9 percent higher than the previous year, primarily due to higher accruals for incentive compensation, costs associated with the previously announced departure of three executive officers recorded in the first fiscal quarter, and the CEO transition. The company currently expects operating expenses for the full fiscal year, including costs associated with these executive officer changes, to be toward the upper end of its guidance range of $132 million to $137 million.

Net income for the quarter was $13.8 million, which is 36.8 percent higher than $10.1 million reported in the same quarter last year. Net income increased primarily due to a higher gross profit margin, including the absence of the asset impairment charge, and higher revenue, partially offset by higher operating expenses. Year to date, net income was $33.7 million, which is 57.6 percent higher than the same period last year.

Diluted earnings per share were $0.55 this quarter, which represents an increase of 37.5 percent compared to $0.40 reported in the same quarter last year; last year's results included a $0.06 adverse impact associated with the asset impairment charge. Year to date, diluted earnings per share were $1.36, which represents an increase of 58.1 percent compared to $0.86 last year, which included the asset impairment charge.

CONFERENCE CALL

Cabot Microelectronics Corporation's quarterly earnings conference call will be held today at 9:00 a.m. Central Time. The conference call will be available via live webcast and replay from the company's website, www.cabotcmp.com, or by phone at (844) 825-4410. Callers outside the U.S. can dial (973) 638-3236. The conference code for the call is 21945778. A transcript of the formal comments made during the conference call will also be available in the Investor Relations section of the company's website.

ABOUT CABOT MICROELECTRONICS CORPORATION

Cabot Microelectronics Corporation, headquartered in Aurora, Illinois, is the world's leading supplier of CMP polishing slurries and a growing CMP pad supplier to the semiconductor industry. The company's products play a critical role in the production of advanced semiconductor devices, enabling the manufacture of smaller, faster and more complex devices by its customers. The company's mission is to create value by developing reliable and innovative solutions, through close customer collaboration, that solve today's challenges and help enable tomorrow's technology. The company has approximately 1,025 employees on a global basis. For more information about Cabot Microelectronics Corporation, visit www.cabotcmp.com or contact Trisha Tuntland, Director of Investor Relations at 630-499-2600.

SAFE HARBOR STATEMENT

This news release may include statements that constitute "forward looking statements" within the meaning of federal securities regulations. These forward-looking statements include statements related to: future sales and operating results; company and industry growth, contraction or trends; growth or contraction of the markets in which the company participates; the company's management, international events, regulatory or legislative activity, or various economic factors; product performance; the generation, protection and acquisition of intellectual property, and litigation related to such intellectual property; new product introductions; development of new products, technologies and markets; natural disasters; the acquisition of or investment in other entities; uses and investment of the company's cash balance; financing facilities and related debt, payment of principal and interest, and compliance with covenants and other terms; the company's capital structure; the company's current or future tax rate; and the operation of facilities by Cabot Microelectronics Corporation. These forward-looking statements involve a number of risks, uncertainties, and other factors, including those described from time to time in Cabot Microelectronics' filings with the SEC, that could cause actual results to differ materially from those described by these forward-looking statements. In particular, see "Risk Factors" in the company's quarterly report on Form 10-Q for the quarter ended December 31, 2014 and in the company's annual report on Form 10-K for the fiscal year ended September 30, 2014, both filed with the SEC. Cabot Microelectronics assumes no obligation to update this forward-looking information.