Applied Materials Announces Results for Fiscal 1996; Orders of $4.3 Billion, Sales of $4.1 Billion, Income of $599.6 Million.SANTA CLARA Santa Clara, city, Cuba Santa Clara (sän`tä klä`rä), city (1994 est. pop. 217,000), capital of Villa Clara prov., central Cuba. , Calif.--(BUSINESS WIRE)--Nov. 21, 1996--Applied Materials, Inc. reported results for its fiscal year ended October 27, 1996, with net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight of $4.1 billion, an increase of 35.4 percent from fiscal 1995 net sales of $3.1 billion. Net income for fiscal 1996 increased 32.1 percent to $599.6 million, or $3.27 per share, from $454.1 million, or $2.56 per share, for fiscal 1995. New orders increased 10.3 percent in fiscal 1996 to $4.3 billion, from $3.9 billion in fiscal 1995. 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 the end of fiscal 1996 was $1.4 billion, down from $1.5 billion at the end of fiscal 1995. The Company also announced results for its fourth fiscal quarter ended October 27, 1996, with net sales of $861.0 million, a decrease of 12.4 percent from net sales of $982.7 million for the fourth fiscal quarter of 1995. Net income for the fourth fiscal quarter of 1996 was $73.1 million, or $0.40 per share, a decrease of 53.0 percent, from $155.4 million, or $0.84 per share, for the fourth fiscal quarter of 1995. The Company's results of operations for the fourth fiscal quarter of 1996 include a pre-tax restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of $25.1 million, or $0.09 per share after-tax, to cover costs associated with a reduction in workforce and consolidation of certain facilities. The Company's results for the fourth fiscal quarter of 1996 continued to be impacted by the 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. in the semiconductor industry, but were in line with management's expectations. New orders of $683.2 million were received during the fourth fiscal quarter, down 42.9 percent from $1.2 billion in the fourth fiscal quarter of 1995 and down from third fiscal quarter orders of $931.3 million. Significant decreases from third quarter orders were seen in Europe and Asia-Pacific. Geographically, North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. new orders for the fourth fiscal quarter comprised 42 percent of the Company's total, Europe 17 percent, Japan 26 percent, Korea 5 percent and Asia-Pacific 10 percent. Net sales for the fourth quarter of $861.0 million decreased 22.8 percent from third fiscal quarter net sales of $1.1 billion and net income of $73.1 million decreased 56.8 percent from third fiscal quarter net income of $169.1 million. For the fourth fiscal quarter of 1996, net income before the restructuring charge represented 10.4 percent of net sales. Gross margins for the fourth fiscal quarter of 1996 were 44.1 percent, versus 47.7 percent for the third fiscal quarter of 1996. The Company's financial condition remained strong as of October 27, 1996, with total assets of $3.6 billion, cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments of $1.0 billion, a ratio of current assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. to current liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. of 2.9 to 1 and a total debt to capital ratio of 13.7 percent. The Company's focus on asset management resulted in a decrease in accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying and inventory of $206.4 million during the fourth fiscal quarter of 1996. "Looking forward, we believe the industry downturn could extend through the early part of 1997, with the last half of 1997 still uncertain. We are cautiously optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that memory device prices and inventory levels are stabilizing stabilizing, v to hold a limb motionless in order to ground its energy; a standard isometric resistance technique, it releases tension and lengthens muscle fibers. in our customers' business," said James C. Morgan Morgan, American family of financiers and philanthropists. Junius Spencer Morgan, 1813–90, b. West Springfield, Mass., prospered at investment banking. , chairman and chief executive officer. "Applied Materials Applied Materials, Inc. NASDAQ: AMAT (HKSE: 4336 ) is the global leader in nanomanufacturing technology solutions with a broad portfolio of innovative equipment, service and software products for the fabrication of semiconductor chips, flat panel solar displays, solar has always used industry slowdowns to strongly position the Company for long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. growth. At present, most of our new products introduced during the past year are being considered by our customers as they prepare for their next phase of technology evolution. During the remainder of the downturn, we will leverage our balanced global presence, broad product line, technical strength and financial resources to develop world-class technology, provide superior global support and seek to increase our market share. "In keeping with our commitment to technology leadership and product excellence, Applied Materials introduced several key new systems during the fourth fiscal quarter. These systems include the DxZ Optima platform for high-volume CVD CVD Cardiovascular disease, see there applications, as well as the Liner TxZ Centura, a fully integrated CVD-PVD system for advanced multi-level metallization Met`al`li`za´tion n. 1. The act or process of metallizing. schemes. These introductions follow the second quarter release of the Metal Etch To create a design in a material by digging out the material. The circuit designs on printed circuit boards and chips are etched by acid. See chip and printed circuit board. DPS Minicomputer series from Bull HN. 1. (language, text) DPS - Display PostScript. 2. (language) DPS - A real-time language with direct expression of timing requests. ["Language Constructs for Distributed Real-Time PRogramming", I. Centura system and Vectra Ion Metal Plasma technology for the manufacture of critical interconnect (1) To attach one device to another. (2) A physical port (plug, socket) or wireless port (transmitter, receiver) used to attach one device to another. structures on advanced logic and memory devices. We have also announced plans to build a state-of-the-art European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. Technical Center in Newcastle, England, and to expand the infrastructure of our Korea and Asia-Pacific operations. Despite the near-term business challenges, we are confident that we will continue our position as the leading producer of advanced manufacturing equipment for the semiconductor industry," Morgan concluded. Certain matters discussed in this news release contain 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 risks and uncertainties that could cause actual results to differ materially from those projected. Such risks and uncertainties include, but are not limited to, continuing semiconductor device price declines, slowing growth in the demand for semiconductors and the Company's systems and services, semiconductor manufacturers' reduced capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. , insufficient cost reduction programs being implemented by the Company, product pricing pressures, challenges from the Company's competition and the successful development of new products, services and markets. Applied Materials, Inc. is a Fortune 500 global growth company and the world's largest supplier of wafer fabrication Wafer Fabrication is a procedure composed of many repeated sequential processes to produce complete electrical or photonic circuits. Examples include production of radio frequency (RF) amplifiers, LEDs, optical computer components, and CPUs for computers. systems and services to the global semiconductor industry. Applied Materials is traded on the Nasdaq National Market under the symbol, "AMAT AMAT Applied Materials (stock symbol) AMAT Average Memory Access Time AMAT Automatic Message Accounting Transmitter AMAT Anti-Materiel (bomb or mine) AMAT Ageing Management Assessment Team ." Applied Materials' Website is http://www.AppliedMaterials.com. -0-
APPLIED MATERIALS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended Fiscal Year Ended
(In thousands, except Oct. 27, Oct. 29, Oct. 27, Oct. 29,
per share data) 1996 1995 1996 1995
-------- -------- ---------- ----------
Net sales $860,958 $982,650 $4,144,817 $3,061,881
Cost of products sold 481,286 524,252 2,195,078 1,652,033
-------- -------- ---------- ----------
Gross margin 379,672 458,398 1,949,739 1,409,848
Operating expenses:
Research, development
and engineering 117,862 110,498 481,394 329,676
Marketing and selling 72,880 64,730 313,631 223,296
General and
administrative 56,930 49,562 226,063 162,944
Restructuring 25,100 -- 25,100 --
------- ------- ------- -------
Income from operations 106,900 233,608 903,551 693,932
Interest expense 5,836 4,240 20,733 21,401
Interest income 11,353 9,706 39,618 26,012
------- ------- ------- -------
Income from consolidated
companies before taxes 112,417 239,074 922,436 698,543
Provision for income
taxes 39,345 83,676 322,851 244,490
------- ------- ------- -------
Income from consolidated
companies 73,072 155,398 599,585 454,053
Equity in net
income/loss of joint
venture -- -- -- --
------- -------- -------- --------
Net income $73,072 $155,398 $599,585 $454,053
------- -------- -------- --------
Earnings per share $0.40 $0.84 $3.27 $2.56
Average common shares
and equivalents 182,699 184,425 183,607 177,348
APPLIED MATERIALS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
Oct. 27, Oct. 29,
(In thousands) 1996 1995
---------- ----------
ASSETS
Current assets:
Cash and cash equivalents $ 403,888 $ 285,845
Short-term investments 633,744 483,487
Accounts receivable, net 822,384 817,730
Inventories 478,552 427,413
Deferred income taxes 281,586 198,888
Other current assets 72,915 98,250
---------- ----------
Total current assets 2,693,069 2,311,613
Property, plant and equipment, net 919,038 630,746
Other assets 25,880 23,020
---------- ----------
Total assets $3,637,987 $2,965,379
---------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ 77,522 $ 61,748
Current portion of long-term debt 22,640 21,064
Accounts payable and accrued expenses 791,897 659,572
Income taxes payable 43,168 119,347
---------- ----------
Total current liabilities 935,227 861,731
Long-term debt 275,485 279,807
Deferred income taxes and other
non-current obligations 56,850 40,338
---------- ----------
Total liabilities 1,267,562 1,181,876
---------- ----------
Stockholders' equity:
Common stock 1,802 1,792
Additional paid-in capital 763,376 760,057
Retained earnings 1,599,564 999,979
Cumulative translation adjustments 5,683 21,675
---------- ----------
Total stockholders' equity 2,370,425 1,783,503
---------- ----------
Total liabilities and stockholders'
equity $3,637,987 $2,965,379
---------- ----------
-0- CONTACT: Applied Materials, Inc. Susan Overstreet, 408/748-5227 (Investment Community) Shannon Fryhoff, 408/986-7229 (Editorial/Media) |
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