BE Semiconductor Industries Reports Third Quarter 1998 Results.DRUNEN Drunen is a town with a population of 20,000 (2003) in the municipality of Heusden in the southern Netherlands. The town is located close to the National Park of Loonse en Drunense Duinen. , The Netherlands--(BUSINESS WIRE)--Nov. 4, 1998--BE Semiconductor Industries N.V. (Nasdaq: BESIF; Amsterdam Stock Exchange
The Amsterdam Stock Exchange is the former name for the stock exchange based in Amsterdam. : BESI; Frankfurt Stock Exchange Frankfurt Stock Exchange The largest of Germany's eight securities exchanges, operated by Deutsche Borse AS. : BSI BSI - British Standards Institute ), a leading manufacturer of assembly equipment for the semiconductor industry, today announced its financial results for the third quarter and nine months ended September September: see month. 30, 1998. In order to facilitate comparisons, financial data for the nine months ended September 30, 1997 has been prepared on a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis to reflect the contribution of the Company's Leadframe and Connector Plating Services ("the Leadframes Business") to Possehl BESI Electronics N.V. ("PBE PBE Password Based Encryption (cryptography) PBE Programming By Example PBE Protective Breathing Equipment PBE Prompt By Example PBE Place-Based Education PBE Paint Body Equipment PBE Pool Boiling Experiment PBE Plain Both Ends "), a joint venture in which the Company owns 30%. 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 for the third quarter of 1998 were NLG NLG The ISO 4217 currency code for the Dutch Guilder. 80.1 million (US$ 42.5 million), a decrease of 7.5% as compared to net sales of NLG 86.6 million (US$ 42.7 million) in the second quarter of 1998 and 10.1% as compared to net sales for the third quarter of 1997 of NLG 89.1 million (US$ 44.8 million). The Company's net income for the third quarter of 1998 amounted to NLG 1.9 million (US$ 1.0 million), compared to a 1998 second quarter net loss of NLG 1.8 million (US$ 0.9 million) and net income of NLG 5.0 million (US$ 2.5 million) in the third quarter of 1997. Net income per share was NLG 0.07 (US$ 0.04) for the third quarter of 1998, as compared to a net loss per share of NLG 0.07 (US$ 0.03) in the second quarter of 1998 and net income per share of NLG 0.19 (US$ 0.10) in the year-ago quarter. Commenting on these results, Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a Blickman, President and Chief Executive Officer, said, "As was discussed in our preliminary earnings announcement on October October: see month. 6, 1998, we are pleased to report an operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of NLG 1.2 million for the quarter in spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite declining net sales as compared to our 1998 second quarter and the comparable quarter of the prior year. Net income for the third quarter amounted to NLG 1.9 million and was generated by PBE, reflecting a significant improvement in its operating performance as compared to the second quarter of 1998." Net sales for the nine months ended September 30, 1998 decreased slightly to NLG 251.4 million (US$ 133.4 million), compared to net sales of NLG 253.7 million (US$ 127.5 million) in the prior year period. The Company's net income for the first nine months of 1998 was NLG 2.6 million (US$ 1.4 million), as compared to net income of NLG 13.9 million (US$ 7.0 million) for the first nine months of 1997. Earnings per share were NLG 0.10 (US$ 0.05) for the first nine months of 1998, compared to earnings per share of NLG 0.53 (US$ 0.27) for the first nine months of 1997. The Company noted that the 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 September 30, 1998 was NLG 117.4 million, a 21.3% decline in comparison to the backlog of NLG 149.2 million at June June: see month. 30, 1998. "Due to ongoing weakness in global markets for semiconductor related capital equipment, which reduced demand for packaging and plating systems, our backlog decreased significantly as compared to June 30, 1998. The book-to-bill ratio Book-to-Bill Ratio The technology industry's demand-to-supply ratio for orders on a "firm's book" to number of orders filled. Notes: This ratio tells whether the company has more orders than it can deliver (if greater than 1), has the same amount of orders that it can for the first nine months of 1998 was 0.94, compared to 1.15 for the first nine months of 1997. Based on current order rates and industry conditions, we cannot forecast at present a near term improvement in our backlog," Mr. Blickman stated. Gross profit for the third quarter of 1998 was NLG 26.5 million (US$ 14.0 million), as compared to NLG 33.6 million (US$ 16.9 million) in the same period of 1997. As a percentage of net sales, gross profit was 33.0% in the 1998 third quarter and 32.9% in the second quarter of 1998. Gross margin was 37.7% in the 1997 third quarter. The gross margin decline in the 1998 third quarter as compared to the prior year period was principally due to price competition, product mix and lower gross margins realized in connection with the sale of new packaging equipment. The Company's operating profit for the third quarter of 1998 was NLG 1.2 million (US$ 0.6 million) as compared to 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. of NLG 0.4 million (US$ 0.2 million) in the second quarter of 1998 and an operating profit of NLG 7.1 million (US$ 3.6 million) in the 1997 period. As a percentage of net sales, the Company's operating profit was 1.5% in the third quarter of 1998 as compared to an operating loss of 0.4% in the second quarter of 1998 and an operating profit of 8.0% in the 1997 period. The decrease in the third quarter of 1998 as compared to the 1997 period was mainly due to lower sales levels, lower gross margins and higher operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. relative to net sales. Selling, general and administrative expenses increased as a percentage of net sales to 22.1% in the third quarter of 1998 as compared to 20.4% in the 1997 period, but decreased from 24.0% in the second quarter of 1998. PBE contributed net income of NLG 1.9 million (US$ 1.0 million) to the Company in the third quarter of 1998, including an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. foreign currency gain of NLG 0.7 million, as compared to a 1998 second quarter loss of NLG 1.4 million (US$ 0.7 million), which was attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to an after-tax foreign currency loss of NLG 1.4 million. In the 1997 third quarter, PBE contributed NLG 0.9 million (US$ 0.4 million) to the Company's net income, including an after-tax foreign currency loss of NLG 2.6 million. At September 30, 1998, the Company's cash totalled NLG 53.7 million and exceeded total debt and capital lease obligations of NLG 36.3 million. At September 30, 1998, shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. was NLG 283.6 million. This press release contains 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. , such as expectations as to future equipment deliveries and results for future periods, that 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 the cyclicality of the semiconductor equipment industry, risks related to customer concentration, delays and cancellations of product orders, the impact of the current banking and currency difficulties experienced by certain Asia-Pacific The term Asia-Pacific generally applies to littoral East Asia, Southeast Asia and Australasia near the Pacific Ocean, plus the states in the ocean itself (Oceania). countries and general economic conditions in such regions, competitive pressures, general economic conditions and the risk factors detailed in the Company's periodic reports and registration statements filed with the Securities and Exchange Commission. BE Semiconductor Industries N.V. designs, develops, manufactures, markets and services molding molding, in architecture, furniture, and decorative objects, a surface or group of surfaces of projecting or receding contours. A molding may serve as a defining element, terminating a unit or an entire composition (e.g. , trim and form and selective plating and tin-lead plating systems for the semiconductor industry's `back-end' assembly operations and provides through its joint venture, Possehl BESI Electronics N.V. ("PBE"), leadframes and connector plating services to customers. The Company's customers consist primarily of leading US, European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. , Asian, Korean Korean, language of uncertain ancestry. It is thought by some scholars to be akin to Japanese, by others to be a member of the Altaic subfamily of the Ural-Altaic family of languages (see Uralic and Altaic languages), and by still others to be unrelated to any known and Japanese Japanese (jăp'ənēz`), language of uncertain origin that is spoken by more than 125 million people, most of whom live in Japan. There are also many speakers of Japanese in the Ryukyu Islands, Korea, Taiwan, parts of the United States, and semiconductor manufacturers and subcontractors. -0-
BE Semiconductor Industries N.V.
Consolidated Statements of Operations
(NLG in thousands, except per share data)
(unaudited)
----------------------------------------------------------------------
Three months ended Nine months ended
September 30, September 30,
------------------------------------------------
1997 1998 1997 1997 1998
Pro Forma(2)
----------------------------------------------------------------------
Net sales 89,134 80,119 306,459 253,666 251,362
Cost of sales 55,511 53,666 200,077 159,951 168,534
-----------------------------------------------
Gross profit 33,623 26,453 106,382 93,715 82,828
Selling, general and
administrative 18,199 17,678 59,869 54,867 57,305
expenses
Research and 6,765 6,063 21,283 21,283 20,061
development
expenses
Amortization of 1,512 1,512 5,142 4,535 4,535
intangible assets
-----------------------------------------------
Total operating 26,476 25,253 86,294 80,685 81,901
expenses
Operating income 7,147 1,200 20,088 13,030 927
Interest expense, 535 350 1,603 1,448 1,010
net
Other income - - - - 500
-----------------------------------------------
Income before
taxes and equity
in earnings of 6,612 850 18,485 11,582 417
affiliated
companies
Income taxes 2,476 838 6,406 5,249 638
-----------------------------------------------
Income (loss)
before equity in
earnings of 4,136 12 12,079 6,333 (221)
affiliated companies
Earnings of - - - 5,746 -
Leadframes
Business
Equity in earnings 3,512 1,192 4,473 4,473 3,315
of affiliated
companies
Foreign currency
gain (loss) of
affiliated companies (2,633) 710 (2,633) (2,633) (452)
------------------------------------------------
Equity in earnings
of affiliated
companies, 879 1,902 1,840 1,840 2,863
net (1)
------------------------------------------------
Net income 5,015 1,914 13,919 13,919 2,642
------------------------------------------------------------------------
Basic net income 0.19 0.07 0.53 0.53 0.10
per share
Diluted net income 0.19 0.07 0.53 0.53 0.10
per share (3)
Number of
shares used in
calculating 26,394,425 26,394,425 26,394,425 26,394,425 26,394,425
basic net
income per share
Number of shares
used in
calculating 26,466,596 26,394,425 26,436,319 26,436,319 26,394,425
diluted net income
per share
-----------------------------------------------------------------------
(1) The Company formed a joint venture on May 30, 1997, named Possehl
BESI Electronics NV ("PBE"). As a result, Leadframes and Connector
Plating Services' financial results are consolidated until May 30,
1997. Results of PBE are included in equity in earnings of
affiliated companies commencing May 30, 1997.
(2) The pro forma financial information reflects the Leadframes
Business of BE Semiconductor Industries N.V., which was
contributed to PBE as of May 30, 1997. BE Semiconductor owns 30%
of PBE and accordingly has accounted for its investment in PBE
under the equity method commencing May 30, 1997. The pro forma
financial information, in which the results of operations of the
Leadframes Business are excluded from the consolidated results of
operations and presented as a single line item, is provided herein
solely to facilitate a comparison of BE Semiconductor's Systems
Business and is not a presentation in accordance with generally
accepted accounting principles.
(3) Diluted income per share is calculated by dividing net income by
the total number of outstanding ordinary shares and ordinary share
equivalents, calculated using the treasury stock method.
The financial information of these interim periods has been
prepared in accordance with US GAAP.
BE Semiconductor Industries N.V.
Consolidated Balance Sheets
(NLG in thousands)
----------------------------------------------------------------------
Dec. 31, 1997 Sept. 30, 1998
(unaudited)
----------------------------------------------------------------------
ASSETS
Cash and cash equivalents 75,007 53,701
Accounts receivable, net 79,369 75,807
Inventories, net 69,500 66,737
Advances to affiliated companies 6,657 4,355
Other current assets 11,537 19,523
-------- ----------
Total current assets 242,070 220,123
Property, plant and equipment, net 78,353 77,824
Intangible assets, net 65,287 60,753
Investment in affiliated companies 59,023 59,640
Other 601 566
-------- ----------
Total assets 445,334 418,906
-------- ----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current portion of long-term debt and 3,781 3,591
capital lease
Accounts payable 50,150 28,158
Other current liabilities 49,567 47,730
-------- ----------
Total current liabilities 103,498 79,479
Long-term debt and capital lease 34,694 32,727
Other long-term liabilities 5,363 5,681
Deferred income tax liabilities 18,137 17,449
-------- ----------
Total non-current liabilities 58,194 55,857
Total shareholders' equity 283,642 283,570
-------- ----------
Total liabilities and shareholders' equity 445,334 418,906
-------- ----------
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