BILLERICA, Mass., Oct. 27, 2009 (GLOBE NEWSWIRE) -- Entegris, Inc. (Nasdaq:ENTG) today reported its financial results for the fiscal third quarter ended September 26, 2009.
The Company recorded third-quarter sales of $110.7 million and a net loss of $7.6 million, or $0.07 per share. These results included amortization of intangible assets of $4.7 million and restructuring charges of $2.4 million. The Company reported sales of $82.6 million in the second quarter ended June 27, 2009 and sales of $145.8 million in the third quarter a year ago.
For the first nine months of 2009, sales were $252.3 million, which compared to $442.0 million for the same period a year ago.
Gideon Argov, president and chief executive officer, said: "We saw continued positive trends through the third quarter in both the unit-driven and capital-driven sides of our business. Higher fab utilization at many of our semiconductor customers and capital spending in the industry to implement technology process transitions led to higher demand across our product lines. Business trends in our other markets such as data storage, flat panel display, and LED, were also positive.
"Even with third-quarter sales well below historical levels, we achieved an operating margin of 6 percent of sales, excluding the impact of amortization and restructuring expenses, and $14.5 million of adjusted EBITDA for the quarter. This reflected our improved cost structure, as well as our ability to effectively flex our manufacturing operations to meet the higher demand," Argov said.
At the end of the third quarter, total bank debt was $91.6 million. This represented a decrease of $60.1 million from the $151.7 million in second quarter, largely as the result of a secondary equity offering in September, the proceeds of which were used exclusively to pay down debt. The Company's third-quarter ending cash balance was $78.4 million.
Segment Information (table of results contained at the end of this release)
Contamination Control Solutions sales increased 38 percent sequentially from the second quarter of 2009, driven by demand for filtration products, chemical containers, and liquid dispense pumps.
Microenvironments product sales increased 24 percent sequentially from the second quarter of 2009. The growth reflected demand for shippers needed to support increased production in the semiconductor and data storage industries, as well as demand for wafer transport products.
Specialty Materials sales increased 42 percent sequentially from the second quarter of 2009. The increase was due to higher demand for semiconductor-related graphite and silicon carbide products and a partial recovery of demand for certain industrial products.
Third-Quarter Results Conference Call Details
Entegris will hold a conference call to discuss its results for the third quarter on Tuesday, October 27, 2009, at 10:00 a.m. Eastern Time. Participants should dial 1-866-416-5346 (for domestic callers) or 1-913-312-0376 (for callers outside the U.S.). A replay of the call can be accessed at 1-719-457-0820 using passcode 8433843. A webcast of the call can also be accessed from the investor relations section of Entegris' website at www.entegris.com.
About Entegris
Entegris is a leading provider of a wide range of products for purifying, protecting and transporting critical materials used in processing and manufacturing in the semiconductor and other high-tech industries. Entegris is ISO 9001 certified and has manufacturing, customer service and/or research facilities in the United States, China, France, Germany, Israel, Japan, Malaysia, Singapore, South Korea and Taiwan. Additional information can be found at www.entegris.com.
The Entegris, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3700
Non-GAAP Information
Adjusted EBITDA margin and non-GAAP operating margin, together with the related measures of Adjusted EBITDA and non-GAAP operating income, are considered "non-GAAP financial measures" under the rules and regulations of the SEC. These financial measures are provided as a complement to financial measures provided in accordance with GAAP. We provide non-GAAP financial measures in order to better assess and reflect operating performance. Management believes the non-GAAP measures help indicate our baseline performance before certain gains, losses or other charges that may not be indicative of our business or future outlook. We believe these non-GAAP measures will aid investors' overall understanding of our results by providing a higher degree of transparency for certain expenses and providing a level of disclosure that will help investors understand how we plan and measure our business. The presentation of non-GAAP measures is not meant to be considered in isolation, as a substitute for, or superior to, financial measures or information provided in accordance with GAAP. The calculations of Adjusted EBITDA margin and non-GAAP operating margin are included elsewhere in this release.
Forward-Looking Statements
Certain information contained in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current management expectations only as of the date of this press release, and involve substantial risks and uncertainties that could cause actual results to differ materially from the results expressed in, or implied by, these forward-looking statements. Statements that include such words as "anticipate," "believe," "estimate," "expect," "forecast," "may," "will," "should" or the negative thereof and similar expressions as they relate to Entegris or our management are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. These risks include, but are not limited to, fluctuations in the market price of Entegris' stock, Entegris' future operating results, other acquisition and investment opportunities available to Entegris, general business and market conditions and other factors. Additional information concerning these and other risk factors may be found in previous financial press releases issued by Entegris and Entegris' periodic public filings with the Securities and Exchange Commission, including discussions appearing in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2008, as well as the matters described under the headings "Risks Relating to our Business and Industry," "Risks Related to our Borrowings", "Manufacturing Risks," "International Risks," and "Risks Related to Investing in Our Securities" in our current report on Form 8-K, dated September 2, 2009, together with the other matters and important factors disclosed previously and from time to time in the filings of Entegris with the U.S. Securities and Exchange Commission. Except as required under the federal securities laws and the rules and regulations of the Securities and Exchange Commission, we undertake no obligation to update publicly any forward-looking statements contained herein.
Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three months ended
-------------------------------
Sept. 26, Sept. 27, June 27,
2009 2008 2009
-------------------------------
Net sales $ 110,706 $ 145,789 $ 82,576
Cost of sales 65,929 90,391 58,846
-------------------------------
Gross profit 44,777 55,398 23,730
Selling, general and
administrative expenses 29,175 35,373 25,685
Engineering, research and
development expenses 8,575 10,284 7,843
Amortization of intangible assets 4,723 4,858 4,931
Impairment of goodwill -- 379,810 --
Restructuring charges 2,368 3,332 5,452
-------------------------------
Operating loss (64) (378,259) (20,181)
Interest expense, net 2,681 614 2,577
Other expense, net 4,114 947 1,537
-------------------------------
Loss before income taxes (6,859) (379,820) (24,295)
Income tax expense (benefit) 623 12,897 (2,252)
Equity in net loss of affiliates 132 195 449
-------------------------------
Loss from continuing operations (7,614) (392,912) (22,492)
Loss from discontinued operations,
net of taxes -- (90) --
-------------------------------
Net loss (7,614) (393,002) (22,492)
Net loss attributable to the
noncontrolling interest 6 -- --
-------------------------------
Net loss attributable
to the Company $ (7,608) $(393,002) $ (22,492)
===============================
Basic loss per common share:
Continuing operations ($ 0.07) $ (3.51) ($ 0.20)
Net loss per common share ($ 0.07) $ (3.52) ($ 0.20)
Diluted loss per common share:
Continuing operations ($ 0.07) $ (3.51) ($ 0.20)
Net loss per common share ($ 0.07) $ (3.52) ($ 0.20)
Weighted average shares outstanding:
Basic 115,023 111,796 112,694
Diluted 115,023 111,796 112,694
Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Nine months ended
--------------------
Sept. 26, Sept. 27,
2009 2008
--------------------
Net sales $ 252,320 $ 441,963
Cost of sales 178,795 262,690
--------------------
Gross profit 73,525 179,273
Selling, general and administrative expenses 84,581 115,800
Engineering, research and development expenses 25,322 31,147
Amortization of intangible assets 14,635 14,497
Impairment of goodwill -- 379,810
Restructuring charges 12,454 3,332
--------------------
Operating loss (63,467) (365,313)
Interest expense, net 7,105 682
Other expense, net 429 1,823
--------------------
Loss before income taxes (71,001) (367,818)
Income tax (benefit) expense (4,226) 16,312
Equity in net loss of affiliates 1,076 49
--------------------
Loss from continuing operations (67,851) (384,179)
Loss from discontinued operations, net of taxes -- (1,025)
--------------------
Net loss (67,851) (385,204)
Net loss attributable to the
noncontrolling interest 6 --
--------------------
Net loss attributable to the Company $ (67,845) $(385,204)
====================
Basic loss per common share:
Continuing operations $ (0.60) $ (3.40)
Discontinued operations -- $ (0.01)
Net loss per common share $ (0.60) $ (3.41)
Diluted loss per common share:
Continuing operations $ (0.60) $ (3.40)
Discontinued operations -- $ (0.01)
Net loss per common share $ (0.60) $ (3.41)
Weighted average shares outstanding:
Basic 113,355 112,942
Diluted 113,355 112,942
Entegris, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
Sept. 26, Dec. 31,
2009 2008
-------- --------
ASSETS
Cash and cash equivalents $ 78,376 $115,033
Accounts receivable 80,062 70,535
Inventories 84,116 102,189
Deferred tax assets, deferred tax charges
and refundable income taxes 11,001 14,661
Other current assets and assets held for sale 6,615 10,710
-------- --------
Total current assets 260,170 313,128
Property, plant and equipment, net 146,726 159,738
Intangible assets 82,788 93,139
Deferred tax assets - non-current 12,126 13,315
Other assets 16,219 18,504
-------- --------
Total assets $518,029 $597,824
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current maturities of long-term debt 11,464 $ 13,166
Short-term borrowings 7,001 --
Accounts payable 27,044 21,782
Accrued liabilities 29,475 36,971
Income tax payable and deferred tax liabilities 5,694 7,437
-------- --------
Total current liabilities 80,678 79,356
Long-term debt, less current maturities 73,135 150,516
Other liabilities 26,172 31,782
Shareholders' equity 338,044 336,170
-------- --------
Total liabilities and shareholders' equity $518,029 $597,824
======== ========
Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Three months ended Nine months ended
----------------------------------------------------------------------
Sept. 26, Sept. 27, Sept. 26, Sept. 27,
2009 2008 2009 2008
----------------------------------------------------------------------
Operating activities:
Net loss $ (7,614) $(393,002) $ (67,851) $(385,204)
Adjustments to
reconcile net loss to
net cash used in
operating activities:
Loss from discontinued
operations -- 90 -- 1,025
Depreciation 7,456 6,476 23,628 18,776
Amortization 4,723 4,858 14,635 14,497
Stock-based
compensation expense 2,120 1,335 6,299 5,558
Charge for fair value
mark-up of acquired
inventory 51 5,718 4,116 5,718
Impairment of goodwill -- 379,810 -- 379,810
Other 1,662 13,076 3,659 17,527
Changes in operating
assets and liabilities,
excluding effects
of acquisitions:
Trade accounts
receivable
and notes receivable (17,271) 6,039 (7,486) 14,169
Inventories (735) (539) 10,715 (884)
Accounts payable and
accrued liabilities 6,211 (5,632) 1,783 (9,723)
Income taxes payable
and refundable income
taxes (1,803) (10,008) 2,037 (22,230)
Other 4,406 3,524 1,340 2,687
---------------------------------------------------------------------
Net cash (used in)
provided by operating
activities (794) 11,745 (7,125) 41,726
---------------------------------------------------------------------
Investing activities:
Acquisition of property
and equipment (1,122) (7,399) (11,521) (19,194)
Acquisition of
businesses, net of
cash acquired 493 (161,973) 493 (161,973)
Purchase of equity
investment -- -- -- (10,982)
Other 2,315 110 2,550 1,029
---------------------------------------------------------------------
Net cash provided by
(used in) investing
activities 1,686 (169,262) (8,478) (191,120)
---------------------------------------------------------------------
Financing activities:
Payments on short-term
borrowings and
long-term debt (221,164) (29,108) (528,116) (48,406)
Proceeds from
short-term and
long-term borrowings 156,212 133,000 452,722 133,000
Repurchase and
retirement of common
stock -- (4,492) -- (28,895)
Proceeds from stock
offering 56,687 -- 56,687 --
Issuance of common stock 490 902 1,061 3,088
Payments for debt
issuance costs (138) -- (3,638) (622)
---------------------------------------------------------------------
Net cash (used in)
provided by financing
activities (7,913) 100,302 (21,284) 58,165
---------------------------------------------------------------------
Net cash (used in)
provided by
discontinued
operations -- (2) -- 392
---------------------------------------------------------------------
Effect of exchange rate
changes on cash 1,331 (1,230) 230 4,143
---------------------------------------------------------------------
Decrease in cash and
cash equivalents (5,690) (58,447) (36,657) (86,694)
Cash and cash
equivalents
at beginning of period 84,066 132,408 115,033 160,655
---------------------------------------------------------------------
Cash and cash
equivalents at end
of period $ 78,376 $ 73,961 $ 78,376 $ 73,961
=====================================================================
Entegris, Inc. and Subsidiaries
Segment Information
(In thousands)
(Unaudited)
Three Months Ended
-------------------------------------
Net sales Sept. 26, Sept. 27, June 27,
2009 2008 2009
------------------------------------------------------------------
Contamination Control
Solutions $ 65,649 $ 85,806 $ 47,541
Microenvironments 32,445 47,630 26,176
Specialty Materials 12,612 12,353 8,859
--------- --------- ---------
Total net sales $ 110,706 $ 145,789 $ 82,576
========= ========= =========
Three Months Ended
--------------------------------------
Segment profit (loss) Sept. 26, Sept. 27, June 27,
2009 2008 2009
------------------------------------------------------------------
Contamination Control
Solutions $ 12,261 $ 20,911 $ 3,181
Microenvironments 5,186 6,855 (155)
Specialty Materials 1,369 3,832 (1,047)
--------- --------- ---------
Total segment profit $ 18,816 $ 31,598 $ 1,979
Amortization of intangibles,
impairment of
goodwill, and
restructuring charges (7,091) (388,000) (10,383)
Unallocated expenses (11,789) (21,857) (11,777)
--------- --------- ---------
Total operating loss $ (64) $(378,259) $ (20,181)
========= ========= =========
Entegris, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Operating Income (Loss)
and Adjusted EBITDA
(In thousands)
(Unaudited)
Three Months Ended
-------------------------------------
Sept. 26, Sept. 27, June 27,
2009 2008 2009
------------------------------------------------------------------
Net sales $ 110,706 $ 145,789 $ 82,576
------------------------------------------------------------------
GAAP - Operating loss $ (64) $(378,259) $ (20,181)
Restructuring costs 2,368 3,332 5,452
Impairment of goodwill -- 379,810 --
Amortization of
intangible assets 4,723 4,858 4,931
--------- --------- ---------
Non-GAAP operating income
(loss) 7,027 9,741 (9,798)
Depreciation 7,456 6,476 7,903
--------- --------- ---------
Adjusted EBITDA $ 14,483 $ 16,217 $ (1,895)
========= ========= =========
Non-GAAP operating margin 6.3% 6.7% (11.9%)
Adjusted EBITDA - as a %
of net sales 13.1% 11.1% (2.3%)
------------------------------------------------------------------