ADE Corporation Announces Fourth-Quarter Financial Results in Line With Company Guidance; Company Reports Increasing First-Quarter Bookings Activity.Business/Technology Editors ADE Corporation (Nasdaq: ADEX ADEX Athens Derivatives Exchange (Athens, Greece) ADEX Air Defense Exercise ADEX Advertisement Expenditure ADEX Asociaciã³n de Exportadores (Peru) ), a leading supplier of wafer (1) A small, thin continuous-loop magnetic tape cartridge that has been used from time to time for data storage and specialized applications. (2) The base unit of chip making. It is a slice taken from a salami-like silicon crystal ingot up to 12" (300mm) in diameter. measurement and inspection systems for the silicon manufacturing industry, today reported its financial results for the fourth quarter and fiscal year ended April 30, 2002. ADE met its financial guidance for the fourth quarter of fiscal 2002. Revenues were $16.6 million, compared with $26.9 million for the same quarter a year ago. ADE's net loss was $4.1 million, or $0.30 per share, with 13.7 million weighted average basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. shares outstanding. This compares with net income of $2.1 million, or $0.16 per share, with 13.7 million weighted average diluted shares outstanding for the fourth quarter of fiscal 2001. During the fourth quarter of fiscal 2002, ADE incurred approximately $200,000 in severance-related costs and approximately $1.5 million in legal costs associated with ADE's current litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. against KLA-Tencor Corporation. Cash and cash equivalents totaled $26.1 million at April 30, 2002, compared with $29.2 million at the end of fiscal 2001. Receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed and inventories decreased to $44.4 million from $63.4 million at the end of fiscal 2001. "We saw additional signs in the fourth quarter that 300mm wafer production should soon begin to ramp, boding bod·ing n. An omen or foreboding, especially of evil. Noun 1. boding - a feeling of evil to come; "a steadily escalating sense of foreboding"; "the lawyer had a presentiment that the judge would dismiss the case" well for a rebound rebound (rē´bownd), n/v 1. a recovery from illness. n 2. an outbreak of fresh reflex activity after withdrawal of a stimulus rebound adjective in ADE's business during the current fiscal year," stated Dr. Chris L. Koliopoulos, ADE's president and chief executive officer. "Although the current industry downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. constrained con·strain tr.v. con·strained, con·strain·ing, con·strains 1. To compel by physical, moral, or circumstantial force; oblige: felt constrained to object. See Synonyms at force. 2. our fourth-quarter performance, we managed costs effectively and met our financial guidance for the quarter." "Revenues and bookings remained soft during the fourth quarter, but the Company has received a growing number of customer inquiries for its products," continued Koliopoulos. "These customers appear to be poised for ramp-ups in 300mm wafer production. In addition, recent reports from Gartner and VLSI VLSI: see integrated circuit. (1) (Very Large Scale Integration) Between 100,000 and one million transistors on a chip. See SSI, MSI, LSI and ULSI. (2) (VLSI Technology, Inc., Tempe, AZ, www.semiconductors. that indicate 300mm production is now on the rise and will accelerate in the next calendar year. ADE has been preparing for this eventuality e·ven·tu·al·i·ty n. pl. e·ven·tu·al·i·ties Something that may occur; a possibility. eventuality Noun pl -ties for several years by rolling out the industry's most advanced line of equipment for 300mm wafer metrology metrology Science of measurement. Measuring a quantity means establishing its ratio to another fixed quantity of the same kind, known as the unit of that kind of quantity. and inspection, strengthening the management team and reshaping our operations. Utilization in 200mm wafer production lines also appears to be increasing, and we have seen a modest increase in orders for ADE legacy equipment recently." "The Company has continued to lower its cost structure," stated ADE Chief Financial Officer Brian James Not to be confused with Brion James. Brian James can be
Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. basis. We entered fiscal 2003 with a leaner, more flexible and stronger organization that is positioned for a quick return to profitability as capital equipment spending becomes more robust." For the fiscal year ended April 30, 2002, ADE reported revenues of $81.8 million, compared with $100.2 million in fiscal 2001. Net loss for fiscal year 2002, including a non-cash income tax valuation allowance of $10.6 million in the second quarter was $23.1 million, or $1.70 per share, with 13.6 million weighted average basic and diluted shares outstanding. This compares with fiscal 2001 net income of $0.5 million, or $0.04 per share, with 13.8 million weighted average diluted shares outstanding. Net loss for fiscal year 2002, excluding the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. non-cash income tax valuation allowance was $12.5 million, or $0.92 per share. Koliopoulos added, "While the wafer industry was experiencing one of the most rapid and prolonged pro·long tr.v. pro·longed, pro·long·ing, pro·longs 1. To lengthen in duration; protract. 2. To lengthen in extent. declines on record last year, ADE was actively positioning itself for its next growth phase. We introduced several new products, which were immediate revenue drivers for the Company, such as the 3220 Advanced Flatness Systems (AFS-130) and the AWIS AWIS Association for Women in Science AWIS Alexa Web Information Service AWIS Army WWMCCS Information System AWIS Advanced Wafer Inspection System (ADE Corporation) AWIS Association for the Wellbeing of Israel's Soldiers surface inspection tool. The Company also introduced its technology in new markets with products such as the X9 Magnetometer, used in the production of MRAM (Magnetic RAM) A non-volatile, random access memory technology that is designed to initially replace flash memory and, potentially, DRAM memory. MRAM uses magnetic, thin film elements on a silicon substrate that can be built on the same chip with the logic circuits. , and its films inspection tool which addresses large, strategic market opportunities on the device side." Business Outlook "Based on our recent order inquiry rate and an expectation that purchases of 300mm equipment will soon begin to accelerate, we believe the Company will experience one or two more quarters of challenging financial results before beginning its resurgence re·sur·gence n. 1. A continuing after interruption; a renewal. 2. A restoration to use, acceptance, activity, or vigor; a revival. ," continued Koliopoulos. "We are seeing increasing booking activity, which suggests that backlog and revenues will improve in the second quarter of fiscal 2003. In addition, the new market opportunities that we have created for the Company through recent product launches should help to address ADE's cyclicality, creating a more stable organization over the longer term. I am excited about ADE's business prospects, confident about the strength of our organization, and I look forward to reporting improved top- and bottom-line performance as fiscal 2003 progresses." James concluded, "While we continue to be cautious with our projections, we believe ADE will likely hit the bottom of the current down cycle in the first quarter and then generate top- and bottom-line improvements as we go forward this fiscal year. Assuming that customer interest continues to escalate es·ca·late v. es·ca·lat·ed, es·ca·lat·ing, es·ca·lates v.tr. To increase, enlarge, or intensify: escalated the hostilities in the Persian Gulf. v.intr. , we believe that ADE can achieve break-even bottom-line results by the end of fiscal 2003. Our leadership team has been carefully focused on returning ADE to profitability while translating our R&D into a superior product portfolio that will help us grow profitably. While the first quarter will be challenging, we have made great progress over the past year to position ADE to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. increased market demand. We are also encouraged by the recent uptick Uptick A transaction occurring at price above its previous transaction. In order for an uptick to occur, a transaction price must be followed by an increased transaction price. in the Company's bookings activity." For the first quarter of fiscal 2003, ADE is currently forecasting revenues in the range of $13 million to $15 million. Gross margins for the first quarter are expected to be in the range of 30% to 35%, reflecting a lower revenue level. Research and development expenditures are expected to decline on a dollar basis and be in the range of 34% to 35% of revenues for the first quarter. Given these projections, the Company anticipates an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for the first quarter of fiscal 2003 in the range of $0.35 per share to $0.43 per share. Conference Call Reminder ADE will host a conference call to discuss the Company's fourth-quarter financial results on Wednesday, June 26, 2002 at 8:30 a.m. Eastern Time (ET). To participate in the webcast, please visit the "Investor Relations Investor relations The process by which the corporation communicates with its investors. " section at the ADE website, located at www.ade.com, fifteen minutes prior to the start of the conference call. This will allow participants the time to download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. The software and broadcast can be obtained at no charge to the user. A replay of the call will be available on the website two hours after the completion of the conference call and will continue to be available for a period of one week. About ADE Corporation ADE Corporation is a leading supplier of metrology and inspection systems for the silicon wafer and data storage industries. The Company's systems analyze and report product quality at critical manufacturing process steps and provide quality certification data that is relied upon by semiconductor and data storage manufacturers. The Company's systems also are used in the fabrication fabrication (fab´rikā´sh  n),n the construction or making of a restoration. of integrated circuits Integrated circuits Miniature electronic circuits produced within and upon a single semiconductor crystal, usually silicon. Integrated circuits range in complexity from simple logic circuits and amplifiers, about 1/20 in. (1. . To learn more about ADE, visit the Company's Web site at www.ade.com. This news release contains certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Those statements that make reference to the Company's expectations, predictions, assumptions and anticipations should be considered forward-looking statements. These statements include, but are not limited to, those associated with the recovery of the cyclical cyclical Of or relating to a variable, such as housing starts, car sales, or the price of a certain stock, that is subject to regular or irregular up-and-down movements. semiconductor and data storage industries, wafer pricing and wafer demand, the anticipated ramp up Ramp Up To increase a company's operations in anticipation of increased demand. Notes: A company might 'ramp up' operations if they just signed a contract creating substantially more demand for their product. See also: Demand, Economies of Scale of 300mm capacity, the success of ADE's product development efforts and cost-cutting initiatives, and financial projections, including those for the first quarter of fiscal 2003. These statements involve risks and uncertainties including those associated with the strength of the semiconductor and hard disk markets, wafer pricing and wafer demand, the results of its product development efforts, the success of ADE's product offerings to meet customer needs within the timeframes required by customers in these markets, further increases in backlog, the Company's ability to increase gross margins, its visibility, and its predictions of future financial outcomes. Further information on potential factors that could affect ADE Corporation's business is described in the Company's reports on file with the Securities and Exchange Commission, including its Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended April 30, 2001.
ADE CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share amounts)
Three months ended Twelve months ended
April 30, April 30,
2002 2001 2002 2001
Revenue $ 16,580 $ 26,902 $ 81,806 $ 100,183
Cost of revenue 9,076 12,917 48,132 50,236
Gross profit 7,504 13,985 33,674 49,947
Operating expenses:
Research and
development 5,517 6,521 22,783 22,583
Marketing and
sales 2,953 4,165 13,064 16,218
General and
administrative 3,186 1,893 11,290 9,948
Total operating
expenses 11,656 12,579 47,137 48,749
Income (loss) from
operations (4,152) 1,406 (13,463) 1,198
Interest and other
income (expense),
net (105) 183 256 1,130
Income (loss)
before provision
for (benefit from)
income taxes,
equity in net
earnings (loss) of
affiliated
companies and
cumulative effect
of change in
accounting
principle (4,257) 1,589 (13,207) 2,328
Provision for
(benefit from)
income taxes (198) (74) 10,416 37
Income (loss)
before equity in
net earnings
(loss) of
affiliated
companies and
cumulative effect
of change in
accounting
principle (4,059) 1,663 (23,623) 2,291
Equity in net
earnings (loss) of
affiliated
companies (62) 482 498 2
Income (loss)
before cumulative
effect of change
in accounting
principle (4,121) 2,145 (23,125) 2,293
Cumulative effect
of change in
accounting
principle, net of
tax -- -- -- (1,785)
Net income (loss) $ (4,121) $ 2,145 $ (23,125) $ 508
Net earnings (loss)
per share:
Basic
Earnings (loss)
before
cumulative
effect of change
in accounting
principle $ (0.30) $ 0.16 $ (1.70) $ 0.17
Cumulative effect
of change in
accounting
principle $ -- $ -- $ -- $ (0.13)
Basic earnings
(loss) per share $ (0.30) $ 0.16 $ (1.70) $ 0.04
Diluted
Earnings (loss)
before cumulative
effect of change
in accounting
principle $ (0.30) $ 0.16 $ (1.70) $ 0.17
Cumulative effect
of change in
accounting
principle $ -- $ -- $ -- $ (0.13)
Diluted earnings
(loss) per share $ (0.30) $ 0.16 $ (1.70) $ 0.04
Weighted average
shares outstanding
Basic 13,659 13,537 13,615 13,507
Diluted 13,659 13,705 13,615 13,754
Adjusted net income
(loss) excluding
deferred income
tax valuation
allowance $ (4,121) $ 2,145 $ (12,535) $ 508
Adjusted basic
earnings (loss)
per share $ (0.30) $ 0.16 $ (0.92) $ 0.04
Adjusted diluted
earnings (loss)
per share $ (0.30) $ 0.16 $ (0.92) $ 0.04
ADE CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)
April 30, 2002 April 30, 2001
Assets
Cash and cash equivalents $ 26,108 $ 29,220
Marketable securities 2,571 1,913
Accounts receivable, net 11,725 24,424
Inventories 32,701 39,025
Other current assets 1,278 8,080
Total current assets 74,383 102,662
Fixed assets, net 30,658 29,569
Investments 3,610 3,221
Restricted cash 3,352 3,525
Other assets 2,748 7,730
Total assets $ 114,751 $ 146,707
Liabilities and Stockholders' Equity
Total current liabilities $ 20,714 $ 30,704
Long-term debt 10,715 11,339
Total stockholders' equity 83,322 104,664
Total liabilities and
stockholders' equity $ 114,751 $ 146,707
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