ADE Corporation Reports Fourth-Quarter and Fiscal 2006 Financial Results.WESTWOOD Westwood. 1 Residential town (1990 pop. 12,557), Norfolk co., E Mass., in the greater Boston area; settled 1640, inc. 1897. It has several early 18th-century buildings. 2 Residential borough (1990 pop. 10,446), Bergen co., NE N.J. , Mass. -- ADE Corporation (NasdaqGM: ADEX ADEX Athens Derivatives Exchange (Athens, Greece) ADEX Air Defense Exercise ADEX Advertisement Expenditure ADEX Asociaciã³n de Exportadores (Peru) ) today reported financial results for its fourth quarter and fiscal year ended April 30, 2006. Revenue for the fourth quarter of fiscal 2006 was $29.3 million compared with $26.3 million for the third quarter of fiscal 2006 and $29.8 million for the fourth quarter of fiscal 2005. ADE posted net income of $4.7 million, or $0.32 per 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. share, for the fourth quarter of fiscal 2006. This compares with net income of $4.7 million, or $0.32 per diluted share in the third quarter of fiscal 2006. This figure includes a tax benefit of approximately $980,000 related to 2005 tax deductions Tax deduction An expense that a taxpayer is allowed to deduct from taxable income. tax deduction See deduction. . ADE reported net income of $23.1 million, or $1.60 per diluted share, for the fourth quarter of fiscal 2005. Fourth quarter fiscal 2005 results included a $17.2 million non-cash income tax valuation allowance reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its . Gross margin for the fourth fiscal quarter of 2006 was 54 percent. This compares with 57 percent for the prior quarter and 55 percent for the year-ago fourth fiscal quarter. ADE ended the year with $91.6 million in cash, cash equivalents and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has . This is an increase of 24 percent from $73.7 million at the end of fiscal 2005. Revenue for full-year fiscal 2006 was $103.4 million compared with $116.9 million for fiscal 2005. Fiscal 2006 net income was $15.3 million, or $ 1.04 per diluted share, compared with net income of $40.9 million, or $2.86 per diluted share, for fiscal 2005. Excluding the income tax valuation allowance reversal, ADE generated fiscal 2005 non-GAAP profits of $23.7 million or $1.66 per diluted share. Backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. at April 30, 2006 was $ 53.1 million, a sequential increase of 27% compared with the $41.8 million reported at the end of the third fiscal quarter and an increase from $45.0 million on April 30, 2005. Also, as previously announced, during the fourth fiscal quarter of 2006, ADE entered into a definitive merger agreement with KLA-Tencor Corporation (NasdaqGS: KLAC), which was amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. and restated in May 2006. Under this agreement, KLA-Tencor would acquire ADE for cash consideration of $32.50 per share. On July July: see month. 13, 2006, ADE shareholders approved the proposed merger. A closing date will be established once the parties have cleared or waived all conditions to close, including regulatory clearance from the German antitrust Antitrust The antitrust laws apply to virtually all industries and to every level of business, including manufacturing, transportation, distribution, and marketing. They prohibit a variety of practices that restrain trade. authorities who, as previously reported, notified KLA-Tencor on July 10, 2006 of the commencement of a Phase II investigation of the proposed merger. Both ADE and KLA-Tencor continue to be confident that the acquisition will be completed once German antitrust clearance is obtained. Non-GAAP Financial Results In an effort to provide investors with additional information regarding the Company's results, this news release presents certain figures that exclude the impact of the Company's reversal of deferred tax asset valuation allowances in the fourth quarter of fiscal 2005. The figures may be deemed to be "non-GAAP financial measures." ADE's non-GAAP financial measures are a supplement to financial statements prepared based on generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting ("GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). "). The Company believes this presentation provides investors and ADE management with additional useful insights into its underlying results because of the materiality MATERIALITY. That which is important; that which is not merely of form but of substance. 2. When a bill for discovery has been filed, for example, the defendant must answer every material fact which is charged in the bill, and the test in these cases seems to of the reversal of its deferred tax asset valuation allowances on its fourth-quarter and full-year fiscal 2005 net income. Management believes that presenting results that exclude the impact of this reversal facilitates period-to-period comparisons of the Company's growth on a more consistent basis that better reflects actual trends. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial results is included in the table titled "Non-GAAP to GAAP Reconciliation" in this news release. These non-GAAP financial measures should not be considered in isolation from the comparable GAAP measures nor considered a substitute therefor there·for adv. For that: ordering goods and enclosing payment therefor. Adv. 1. therefor . About ADE Corporation ADE Corporation is a leading supplier of 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 systems for the semiconductor 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. , semiconductor device, magnetic data storage and optics manufacturing industries manufacturing industries npl → industrias fpl manufactureras manufacturing industries npl → industries fpl de transformation . Wafer suppliers and device manufacturers worldwide rely on ADE measurement and inspection systems to certify cer·ti·fy v. cer·ti·fied, cer·ti·fy·ing, cer·ti·fies v.tr. 1. a. To confirm formally as true, accurate, or genuine. b. and ensure the highest quality bare silicon substrates. ADE's most recent generation of products serve both 65nm in-line In-line Used in the context of general equities. (1) An order or market in a specific security within the inside market; 2) any announcement (earnings) that adheres closely to Wall Street analysts' expectations. manufacturing applications and 45nm process development. Semiconductor device yields begin with the bare wafer, and ADE's leading technology provides early insight into surface defect defect - bug , shape, flatness and nanotopography of these advanced 300mm substrates. Additional information about ADE is available on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at http://www.ade.com, which website is not part of this press release. Cautionary Statement Regarding 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. This news release contains certain forward-looking statements within the meaning of the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " provisions of the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 and federal securities law. Such forward-looking statements 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 expectations, predictions, beliefs, and assumptions should be considered forward-looking statements. These statements include, but are not limited to, those associated with the proposed merger with KLA-Tencor, including the expected closing time for the proposed merger and the obtaining of clearance from German antitrust authorities. These statements involve risks and uncertainties including those associated with delays in obtaining, or adverse conditions contained in, the German antitrust authorities' regulatory approvals; failure to consummate To carry into completion; to fulfill; to accomplish. A Common-Law Marriage is consummated when the parties live in a manner intended to bring about public recognition of their relationship as Husband and Wife. or delay in consummating the proposed merger for other reasons, changes in laws or regulations and other similar factors. Further information on potential factors that could affect ADE's business is contained in its 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 year ended April 30, 2005. ADE is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
ADE CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share amounts)
Three months Twelve months
ended ended
April 30 April 30
----------------- -------------------
2006 2005 2006 2005
-------- -------- --------- ---------
Revenue $29,264 $29,794 $103,448 $116,901
Cost of revenue 13,338 13,390 45,820 54,294
-------- -------- --------- ---------
Gross profit 15,926 16,404 57,628 62,607
-------- -------- --------- ---------
Operating expenses:
Research and development 4,072 4,106 15,815 15,519
Marketing and sales 4,227 4,045 13,610 13,044
General and administrative 3,141 2,464 11,076 10,404
-------- -------- --------- ---------
Total operating expenses 11,440 10,615 40,501 38,967
-------- -------- --------- ---------
Income from operations 4,486 5,789 17,127 23,640
Gain on sale of marketable
securities 915 - 915 -
Interest and other income, net 832 279 2,555 668
-------- -------- --------- ---------
Income before provision for
(benefit from) income taxes 6,233 6,068 20,597 24,308
Provision for (benefit from)
income taxes 1,510 (17,077) 5,340 (16,633)
-------- -------- --------- ---------
Net income $4,723 $23,145 $15,257 $40,941
======== ======== ========= =========
Basic earnings per share $0.33 $1.63 $1.06 $2.91
Diluted earnings per share $0.32 $1.60 $1.04 $2.86
Weighted average shares
outstanding - basic 14,475 14,166 14,393 14,069
Weighted average shares
outstanding - diluted 14,822 14,436 14,686 14,312
ADE CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)
April 30, April 30,
2006 2005
Assets
Cash and cash equivalents $91,573 $72,841
Marketable securities - 836
Accounts receivable, net 23,164 18,499
Inventories 35,855 30,764
Other current assets 1,701 1,373
Deferred income taxes 9,311 10,601
--------- ---------
Total current assets 161,604 134,914
Fixed assets, net 8,946 9,241
Deferred income taxes 4,742 6,616
Investments 499 499
Other assets 1,671 1,956
--------- ---------
Total assets $177,462 $153,226
========= =========
Liabilities and Stockholders' Equity
Total current liabilities $22,718 $18,273
Deferred gain on sale-leaseback 1,383 1,496
Long-term debt 3,244 3,431
Total stockholders' equity 150,117 130,026
--------- ---------
Total liabilities and stockholders' equity $177,462 $153,226
========= =========
ADE CORPORATION
NON-GAAP to GAAP RECONCILIATION
(In thousands, except per share amounts)
Three months Twelve months
ended ended
April 30 April 30
---------------- -----------------
2006 2005 2006 2005
------- -------- -------- --------
Net income - GAAP $4,723 $23,145 $15,257 $40,941
Less:
Reversal of income tax valuation
allowance - (17,217) - (17,217)
------- -------- -------- --------
Net income - non-GAAP $4,723 $5,928 $15,257 $23,724
======= ======== ======== ========
Diluted earnings per share - GAAP $0.32 $1.60 $1.04 $2.86
Less:
Reversal of income tax valuation
allowance - (1.19) - (1.20)
------- -------- -------- --------
Diluted earnings per share - non-
GAAP $0.32 $0.41 $1.04 $1.66
======= ======== ======== ========
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