Varian Semiconductor Equipment Associates, Inc. ("Varian Semiconductor") (NASDAQ: VSEA) today announced results for its fiscal year 2010 third quarter ended July 2, 2010.
Revenue for the third quarter of fiscal year 2010 totaled $227.7 million, compared to revenue of $73.4 million for the same period a year ago. Varian Semiconductor recorded net income of $45.2 million, or $0.60 per diluted share during the third quarter of fiscal year 2010, compared to a net loss of $12.5 million, or $0.17 per diluted share for the same period a year ago.
Gary Dickerson, chief executive officer of Varian Semiconductor, said, "We have invested in bringing to market, technology that enables our customers to address device scaling challenges. Our technology leadership is providing us with the ability to penetrate new accounts and achieve dramatic growth this year." Dickerson continued, "We are also reaching important milestones with our growth initiatives. Most notably, we launched the Solion implant product. Overall, the initial response has been very favorable with significant increased demand for demonstration tools and a growing potential customer base. We expect several production tool shipments over the coming months."
Bob Halliday, chief financial officer, provided forward guidance for the fourth quarter of fiscal year 2010, "Our third quarter earnings per diluted share of $0.60 were at the high end of our guidance of $0.55 to $0.60 per diluted share. Also, our gross margins of 49.0% exceeded our guidance. Fourth quarter revenue is expected to be between $250.0 and $260.0 million and earnings per diluted share are anticipated to range from $0.70 to $0.75."
Varian Semiconductor will hold a conference call, broadcast over the Internet, at 5:30 p.m. eastern time today to discuss Varian Semiconductor's operating results and outlook. Access to the call is available through the investor relations page on Varian Semiconductor's website at www.vsea.com. Replays will be available via the website for two weeks after the call.
About Varian SemiconductorEquipment Associates, Inc.
Varian Semiconductor is a leading supplier of ion implantation equipment used in the fabrication of semiconductor chips. Varian Semiconductor's products are used by chip manufacturers worldwide to produce high-performance semiconductor devices. Customers have made Varian Semiconductor the market leader in ion implant because of its architecturally superior products that lower their costs and improve their productivity.
Varian Semiconductor provides support, training, and after-market products and services that help its customers to obtain high utilization and productivity, reduce operating costs, and extend capital productivity of customer investments through multiple product generations. Varian Semiconductor has ranked ?1 in the VLSI Research Customer Satisfaction Survey 13 times over the last 14 years. Varian Semiconductor operates globally and is headquartered in Gloucester, Massachusetts. More information can be found on Varian Semiconductor's web site at www.vsea.com. The information contained in Varian Semiconductor's website is not incorporated by reference into this release, and the website address is included in this release as an inactive textual reference only.
Note: This press release contains forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. For this purpose, statements concerning Varian Semiconductor's guidance for fourth quarter fiscal 2010 revenue, earnings per diluted share, expected product shipments, financial performance, and any statements using the terms "believes," "anticipates," "will," "expects," "plans" or similar expressions, are forward-looking statements. The forward-looking statements involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: volatility in the semiconductor equipment industry; intense competition in the semiconductor equipment industry; Varian Semiconductor's dependence on a small number of customers; fluctuations in Varian Semiconductor's quarterly operating results; market adoption of Varian Semiconductor's new products, such as the Solion implant product; Varian Semiconductor's exposure to risks of operating internationally; uncertain protection of Varian Semiconductor's patent and other proprietary rights; Varian Semiconductor's reliance on a limited group of suppliers; Varian Semiconductor's ability to manage potential growth, decline and strategic transactions; Varian Semiconductor's reliance on one primary manufacturing facility; and Varian Semiconductor's dependence on certain key personnel. These and other important risk factors that may affect actual results are discussed in detail under the caption "Risk Factors" in Varian Semiconductor's Annual Report on Form 10-K for the fiscal year ended October 2, 2009 and in other reports filed by Varian Semiconductor with the Securities and Exchange Commission. Varian Semiconductor cannot guarantee any future results, levels of activity, performance or achievement. Varian Semiconductor undertakes no obligation to update any of the forward-looking statements after the date of this release.
VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) (unaudited) Three Months Ended Nine Months Ended ------------------- ------------------- July 2, July 3, July 2, July 3, 2010 2009 2010 2009 --------- --------- --------- --------- Revenue Product $ 209,919 $ 62,695 $ 528,662 $ 203,681 Service 17,810 10,683 44,292 40,892 --------- --------- --------- --------- Total revenue 227,729 73,378 572,954 244,573 Cost of revenue 116,115 45,217 292,813 155,248 --------- --------- --------- --------- Gross profit 111,614 28,161 280,141 89,325 --------- --------- --------- --------- Operating expenses Research, development and engineering 25,782 19,104 71,856 60,174 Marketing, general and administrative 31,229 22,150 89,282 73,000 Restructuring 380 672 380 8,972 --------- --------- --------- --------- Total operating expenses 57,391 41,926 161,518 142,146 --------- --------- --------- --------- Operating income (loss) 54,223 (13,765) 118,623 (52,821) Interest income, net 1,044 1,043 2,811 3,512 Other expense, net (98) (217) (1,062) (744) --------- --------- --------- --------- Income (loss) before income taxes 55,169 (12,939) 120,372 (50,053) Provision for (benefit from) income taxes 10,001 (484) 19,989 (4,416) --------- --------- --------- --------- Net income (loss) $ 45,168 $ (12,455)$ 100,383 $ (45,637) Weighted average shares outstanding - basic 74,680 73,177 74,262 72,982 Weighted average shares outstanding - diluted 75,590 73,177 75,237 72,982 Net income (loss) per share - basic $ 0.60 $ (0.17)$ 1.35 $ (0.63) Net income (loss) per share - diluted $ 0.60 $ (0.17)$ 1.33 $ (0.63) VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) July 2, October 2, 2010 2009 ------------- ------------- (unaudited) ASSETS Current assets Cash and cash equivalents $ 231,199 $ 192,148 Short-term investments 44,306 44,043 Accounts receivable, net 180,128 115,002 Inventories 158,709 100,764 Deferred income taxes 18,055 19,601 Other current assets 21,005 22,188 ------------- ------------- Total current assets 653,402 493,746 Long-term investments 115,206 86,439 Property, plant and equipment, net 69,529 65,785 Long-term deferred income taxes 6,937 5,325 Other assets 15,004 14,944 ------------- ------------- Total assets $ 860,078 $ 666,239 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Current portion of long-term debt $ 653 $ 610 Accounts payable 45,258 26,449 Accrued expenses 39,549 22,812 Income taxes payable 3,009 1,820 Product warranty 7,312 3,943 Deferred revenue 34,800 27,098 ------------- ------------- Total current liabilities 130,581 82,732 Long-term accrued expenses and other long-term liabilities 78,086 66,285 Long-term debt 1,097 1,592 ------------- ------------- Total liabilities 209,764 150,609 Stockholders' equity Common stock 957 945 Capital in excess of par value 648,142 612,930 Less: Cost of treasury stock (714,877) (714,877) Retained earnings 716,434 616,051 Accumulated other comprehensive (loss) income (342) 581 ------------- ------------- Total stockholders' equity 650,314 515,630 ------------- ------------- Total liabilities and stockholders' equity $ 860,078 $ 666,239
