CVC Reports Results for Fiscal 2000 Second Quarter.Business Editors ROCHESTER, NY--(BUSINESS WIRE)--April 25, 2000 CVC See CSC. , Inc. (Nasdaq: CVCI CVCI Combat Vehicle Communications Interface ), a worldwide supplier of cluster tool equipment for the fabrication fabrication (fab´rikā´sh  n),n the construction or making of a restoration. of thin film recording heads, semiconductor devices and optical components for the telecommunications market, today reported revenue and net income for its fiscal 2000 second quarter ended March 31, 2000. On February 29, 2000, Veeco Instruments (Nasdaq: VECO VECO Vernier Engine Cut Off ) and CVC, Inc. announced the signing of a definitive merger agreement. This merger will create a leading worldwide capital equipment supplier for disk drive components, optical telecommunications and semiconductor applications. Following the completion of the merger on May 5, 2000, CVC will become a wholly-owned subsidiary of Veeco. For the quarter, revenues were $26.4 million, a 49% increase over revenues of $17.8 million for the fiscal 1999 second quarter ended March 31, 1999. Approximately 86% of revenues were attributable to sales of Giant magneto-resistive (GMR (Giant Magnetoresistance) See magnetoresistance. ) process equipment, integrated etch and deposition equipment, and ultra thin insulator insulator Substance that blocks or retards the flow of electric current or heat. An insulator is a poor conductor because it has a high resistance to such flow. Electrical insulators are commonly used to hold conductors in place, separating them from one another and from modules for the fabrication of thin film recording heads for the data storage industry. In addition, 14% of shipments were attributable to sales of deposition process equipment for the specialty semiconductor industry and the optical telecommunications industry, an emerging growth market for the Company. On a year-to-date basis total revenues were $51.7 million, a 59% increase over sales for the same fiscal period in 1999. Prior year's results do not reflect the purchase of Commonwealth Scientific completed in May 1999. Net income for the quarter was $71,000, or $0.01 per share based on 14.1 million diluted shares, compared to $958,000, or $0.12 per share based on 8.0 million diluted shares for the comparable period last year. The increase in the weighted average number of shares outstanding is due primarily to the successful completion of the Company's initial public offering in November 1999. Bookings in the second quarter of fiscal 2000 were $32.2 million, a 36% increase over bookings of $23.6 million reported in the second quarter of fiscal 1999. The book/bill ratio was 1.22 for the second quarter of fiscal 2000. For the first six months of fiscal 2000, orders were $52.3 million compared with $42.0 million for the first six months of fiscal 1999. The book/bill ratio was 1.01 for the first six months of fiscal 2000. On a year-to-date basis net income was $0.6 million versus net income of $1.4 million for the first half of fiscal 1999. The decline in net income for the fiscal 2000 second quarter and first six months is attributable to a decrease in gross margins due to product mix contributed by the addition of Commonwealth Scientific Corporation, the introduction of new technology and continued pricing pressure in the data storage industry. Operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. increases also contributed to the decrease in net income for both periods, as investments in research and engineering to support data storage and optical components technology road maps grew at a rate greater than revenue. Compared to the prior quarter ended December 31, 1999, revenues of $26.4 million in the quarter ended March 31, 2000 increased from $25.2 million or $1.2 million, while net income for the current quarter of $71,000 compares to net income of $545,000 for the quarter ended December 31, 1999, a decrease of $474,000. Since the acquisition of Commonwealth Scientific Corporation in May 1999, CVC has continued to enhance CVC/Commonwealth's IBE IBE International Bureau of Education IBE Internet Booking Engine IBE Institut für Medizinische Informationsverarbeitung, Biometrie Und Epidemiologie (LMU, Muenchen, Germany) IBE Ion Beam Etching and IBD IBD abbr. inflammatory bowel disease Inflammatory bowel disease (IBD) Disease in which the lining of the intestine becomes inflamed. Mentioned in: Amebiasis IBD 1. technology. CVC believes the CONNEXION(R) Cluster Tool integrated solution combining PVD PVD abbr. peripheral vascular disease PVD Peripheral vascular disease, see there and IBE and/or IBD technology will enable customers to reduce costs, increase throughput and increase yield. Comments From Management Christine B. Whitman, Chairman, President and Chief Executive Officer of CVC, Inc., said, "The Company continues to increase its offerings of GMR process equipment and integrated products combining PVD technology with Ion Beam Noun 1. ion beam - a beam of ions moving in the same direction at the same speed ionic beam particle beam - a collimated flow of particles (atoms or electrons or molecules) Etch (IBE), Ion Beam Deposition Ion Beam Deposition is a process of applying materials to a target through the application of an ion beam. In an ion source source materials - gases or evaporated solids - are ionized using electron ionization or by application of high electric fields (Penning ion source). (IBD) and Metal Organic Chemical Vapor Deposition Vapor deposition Production of a film of material often on a heated surface and in a vacuum. Vapor deposition technology is used in a large variety of applications. (MOCVD MOCVD Metallo Organic Chemical Vapor Deposition MOCVD Metal Oxide Chemical Vapor Deposition ). During the quarter, the Company extended its leadership position in the GMR market and continued its penetration into new, high-growth markets, such as telecommunications. We remain cautious about the data storage industry as improved equipment productivity delays demand for system purchases. We, however, are encouraged by customer orders for modules which are providing increased productivity and capacity and extending our customers initial system investments." Whitman went on to say, "We are pleased to report that we shipped a CONNEXION(R) MOCVD Cluster Tool to a disk drive recording head manufacturer. This system will be used to deposit copper for an Advanced Writer application and represents a significant technology convergence milestone that demonstrates our success in applying CVC's leading edge MOCVD product offering and technology expertise to both semiconductor and magnetic thin film head applications." Whitman concluded, "We are very excited about our merger with Veeco Instruments. Veeco's widely recognized reputation in metrology and process equipment is a strong complement to our integrated thin film process technology. Accordingly, the combination of Veeco and CVC provides broader equipment and process solutions to our data storage, optical telecommunications and semiconductor customers." About CVC CVC provides cluster tool manufacturing equipment for Physical Vapor Deposition  This article or section is in need of attention from an expert on the subject.Please help recruit one or [ improve this article] yourself. See the talk page for details. (PVD) by plasma sputtering A popular method for adhering thin films onto a substrate. Sputtering is done by bombarding a target material with a charged gas (typically argon) which releases atoms in the target that coats the nearby substrate. It all takes place inside a magnetron vacuum chamber under low pressure. or Ion Beam Deposition (IBD), Ion Beam Etch (IBE), Diamond-like Carbon Diamond-like carbon (DLC) is an umbrella term that refers to 7 forms[1] of amorphous carbon materials that display some of the unique properties of natural diamond. They are usually applied as coatings to other materials that could benefit from some of those properties. (DLC (1) (Data Link Control) See data link and OSI. (2) (Data Link Control) The data link layer protocol (layer 2) that is used in IBM's SNA networking. See SNA, data link protocol and Microsoft DLC. ) and Metal-Organic Chemical Vapor Deposition (MOCVD). CVC's process solutions address the production of evolving tape and disk drive recording head fabrication, optical components for telecommunications and applications such as GaAs, passive components, 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. , bump metallization Met`al`li`za´tion n. 1. The act or process of metallizing. , and next generation logic devices. CVC, Inc. with operations in Fremont, California For the unincorporated community in Yolo County, California, see . Fremont (IPA: /ˈfriːmɒnt/) is a city in California that was incorporated on January 23, 1956, from the merger of five smaller communities: ; Alexandria, Virginia Alexandria is an independent city in the Commonwealth of Virginia. As of the 2000 census, the city had a total population of 128,284. Located along the Western bank of the Potomac River, Alexandria is approximately 6 miles (9.6 kilometers) south of downtown Washington, DC. ; and Rochester, New York This article is about the city of Rochester in Monroe County. For the town in Ulster County, see Rochester, Ulster County, New York. Rochester, once known as The Flour City, and more recently as The Flower City or provides customer service and technical support near major customer sites throughout the world. For more information about CVC, visit the World Wide Web at http://www.cvc.com. Forward Looking Statements This press release may be deemed to contain forward-looking information. Any forward-looking statements are made pursuant to 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 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. Forward-looking statements, including statements as to industry trends, future economic performance, anticipated revenues and expenses, and products or service line growth, may be significantly and materially impacted by certain risks and uncertainties, including, but not limited to, failure to meet operating objectives or to execute the operating plan of the Company; competition; the cyclical nature of the data storage and semiconductor industries; risks associated with the acceptance of new products by individual customers and by the marketplace; risks associated with dependence on major customers; the impact of economic downturns in foreign markets; integration of acquired companies; attraction and retention of key employees; and other risks referenced from time to time in the Company's filings with the Securities and Exchange Commission, including, but not limited to, its Annual Report on 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 September 30, 1999 and the Company's prospectus, dated November 12, 1999, as filed with the SEC. Investors are urged to read the proxy statement/prospectus filed by Veeco with the Securities and Exchange Commission, and any other relevant documents filed by CVC or Veeco with the SEC, because they contain important information. Investors may obtain these documents for free from the SEC's web site, www.sec.gov or from CVC (Emilio DiCataldo, 716-458-2550).
Consolidated Condensed Financial Statements
(In thousands, except per share data)
STATEMENT OF OPERATIONS
Three Months ended Mar 31 Six Months Ended Mar 31
2000 1999 2000 1999
------------ ------------ ----------- ---------
(Unaudited) (Unaudited)
Revenues $26,436 $17,788 $51,652 $32,443
Gross Margin 9,149 6,805 18,860 13,211
Operating Expenses
Research &
Development 4,724 2,546 8,707 4,985
Sales &
Marketing 2,972 1,832 5,944 3,762
General &
Administrative 1,218 902 2,757 1,714
------------ ------------ ----------- ---------
Total Operating
Expenses 8,914 5,280 17,408 10,461
Income from
Operations 235 1,525 1,452 2,750
Interest &
Other Expense
(Income) 164 (190) 441 136
------------ ------------ ----------- ---------
Income Before
Income Taxes 71 1,715 1,011 2,614
Income Taxes 0 757 395 1,176
------------ ------------ ----------- ---------
Net Income $ 71 $ 958 $ 616 $ 1,438
============ ============ =========== =========
Net Income
Per Share:
Basic $ 0.01 $ 0.91 $ 0.06 $ 1.36
Diluted $ 0.01 $ 0.12 $ 0.05 $ 0.19
Weighted
Average Shares:
Basic 11,668 1,057 9,495 1,057
Diluted 14,081 8,020 13,077 7,667
BALANCE SHEETS Mar 31 Sept. 30
2000 1999
------------ --------------
(Unaudited)
Assets:
Cash and Cash Equivalents $ 196 $ 434
Accounts Receivable 25,908 21,559
Inventories 31,789 29,187
Other Current Assets 3,825 4,215
------------ --------------
Total Current Assets 61,718 55,395
Plant, Property & Equipment, Net 18,506 19,374
Other Assets, Net 1,031 1,148
------------ --------------
Total Assets $81,255 $75,917
============ ==============
Liabilities & Stockholders' Equity
Short-term Borrowings $ 4,837 $13,217
Accounts Payable 11,829 11,279
Other Current Liabilities 4,733 8,795
------------ --------------
Total Current Liabilities 21,399 33,291
Long-term debt 7,053 8,493
Other Liabilities 2,619 2,540
------------ --------------
Total Liabilities 31,071 44,324
Stockholders' Equity 50,184 31,593
------------ --------------
Total Liabilities &
Stockholders' Equity $81,255 $75,917
============ ==============
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