Cascade Microtech Reports Second Quarter 2006 Results; Revenues of $19.6 Million, up 7% Over Last Year and EPS of 7 Cents; Record Bookings for the Quarter with Strong Book-to-Bill for Both Divisions.PORTLAND Portland, town, England Portland, town (1991 pop. 12,945), Dorset, S England. It is on the Isle of Portland, a small rocky peninsula. Portland stone has been used in St. Paul's Cathedral and other important London buildings. Lobsters and crabs are harvested. , Ore. -- Cascade A connected series of devices or images. It often implies that the second and subsequent device takes over after the previous one is used up. For example, cascading tapes in a dual-tape backup system means the second tape is written after the first one is full. Microtech (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CSCD CSCD Community Supervision & Corrections Department (Harris County, Texas) CSCD Cascade & Columbia River Railroad CSCD CTAS Software Change Document CSCD Coupling-Strength-Control Defect ), today reported financial results for the second quarter ended June June: see month. 30, 2006. Highlights for the Second Quarter 2006 include: --Revenues of $19.6 million, up 7% over last year --Record bookings during the quarter with strong book-to-bill for both divisions --$3.6 million Production Probes Division revenue, up 56% over last year --$16.0 million Engineering Products Division revenue, flat with last year --EPS of $0.07 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, including stock compensation expense under SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System 123R --Effective tax rate of 33% for the quarter due to the expiration EXPIRATION. Cessation; end. As, the expiration of, a lease, of a contract, or statute. 2. In general, the expiration of a contract puts an end to all the engagements of the parties, except to those which arise from the non- fulfillment of obligations created of the R&E credit. "We were extremely pleased with our record bookings in the second quarter of 2006. Book-to-bill was well above one in both divisions and we built solid 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. in both probe cards A probe card is an interface between an electronic test system and a semiconductor wafer. Its purpose is to provide an electrical path between the test system and the circuits on the wafer, thereby permitting the testing and validation of the circuits at the wafer level, usually and systems. Our Production Probe division revenue, however, was limited by our production and test capabilities during the quarter. We are continuing to add employees and equipment to build a larger probe card business," said Eric ERIC Educational Research Information Clearinghouse ERIC Educational Resources Information Center ERIC ERISA Industry Committee ERIC Epidemiologic Research and Information Center (Durham, NC) Strid, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Cascade Microtech. Revenue for the second quarter was $19.6 million, net income for the quarter was $0.8 million and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $0.07, compared to revenue of $19.7 million, net income of $0.7 million and diluted earnings per share of $0.06 for the first quarter of 2006. Gross margin for the second quarter improved to 44.6% from 43.5% in the first quarter of 2006 primarily due to product mix. Beginning in January 2006 we were required to expense the costs of stock options through our income statement under SFAS 123R. This resulted in a charge to earnings of approximately $447,000 during the second quarter of 2006. The effective tax rate for the second quarter was 33% in line with the first quarter of 2006. The tax charge for the first and second quarters does not include any benefit for research and experimentation tax credits since current legislation related to such credits has expired ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. and has not yet been renewed. Financial Outlook Based on the current backlog and anticipated bookings, Cascade anticipates that third quarter 2006 revenues will be in the range of $20.0 million to $21.5 million compared to $19.6 million in the second quarter of 2006; and that diluted earnings per share will be in the range of $0.06 to $0.11, including stock compensation expense under SFAS 123R. About Cascade Microtech Cascade Microtech, Inc. (NASDAQ:CSCD) is a worldwide leader in the precise electrical measurement and test 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. (ICs) and other small structures. For technology businesses and scientific institutions that need to evaluate small structures, Cascade Microtech delivers access to, and extraction of, electrical data from wafers wafers compressed roughage in flat plates useful for feeding to animals in transit. , integrated circuits (ICs), IC packages, circuit boards and modules, MEMs, biological structures, electro-optic devices and more. Cascade Microtech's highly reliable production 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. test solutions provide the semiconductor industry with leading-edge probe cards that reduce manufacturing costs of complex semiconductors. Information about Cascade Microtech can be found on the Web at www.cascademicrotech.com. 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. The statements in this release regarding the Company's financial outlook as to revenue and diluted earnings per share in the third quarter of 2006 are "forward-looking" statements within the meaning of the Securities 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. Reform act of 1995. Such statements are based on current expectations, estimates and projections about the Company's business based in part on assumptions made by management. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including changes in demand for the Company's products, product mix, the timing of shipments and customer orders, constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. on supplies of components, excess or shortage of production capacity and other risks discussed from time to time in the Company's Securities and Exchange Commission filings and reports, including the Company's 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. . In addition such statements could be affected by general industry and market conditions and growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made and the company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date of this release. The company will host a conference call beginning at 5 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. (2 p.m. PST PST Paroxysmal supraventricular tachycardia, see there ) on July 25, 2006 to discuss its results for the second quarter ended June 30, 2006 and its outlook for the third quarter of 2006. A simultaneous audio cast of the conference call may be accessed online from the investor relations Investor relations The process by which the corporation communicates with its investors. page of www.cascademicrotech.com. A replay will be available after 7 p.m. EST at this same internet address There are two kinds of addresses that are widely used on the Internet. One is a person's e-mail address, and the other is the address of a Web site, which is known as a URL. Following is an explanation of Internet e-mail addresses only. For more on URLs, see URL and Internet domain name. . (For a telephone replay, dial (888) 286-8010 pass code: 15137563; International: 617-801-6888.)
CASCADE MICROTECH, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)
Three Months Ended Year to Date
June March June Ended
30, 31, 30, June 30,
2006 2006 2005 2006 2005
------- ------- ------- ------- -------
Sales $19,598 $19,699 $18,311 $39,297 $36,972
Cost of sales 10,739 11,020 9,651 21,759 19,141
Stock-based compensation 113 112 10 225 22
------- ------- ------- ------- -------
Gross profit 8,746 8,567 8,650 17,313 17,809
------- ------- ------- ------- -------
Operating expenses:
Research and development
(includes $77, $77, $4,
$154 and $8,
respectively, of
stock-based
compensation) 2,150 1,998 1,669 4,148 3,312
Selling, general and
administrative (includes
$258, $264, $11, $522
and $36, respectively,
of stock-based
compensation) 5,808 6,009 5,172 11,817 9,796
------- ------- ------- ------- -------
Total operating
expenses 7,958 8,007 6,841 15,965 13,108
------- ------- ------- ------- -------
Income from
operations 788 560 1,809 1,348 4,701
------- ------- ------- ------- -------
Other income (expense):
Interest income 405 362 258 767 470
Interest expense - - - - (16)
Other, net (10) 57 766 47 790
------- ------- ------- ------- -------
Total other
income
(expense) 395 419 1,024 814 1,244
------- ------- ------- ------- -------
Income before
income taxes 1,183 979 2,833 2,162 5,945
Provision for income taxes 387 323 602 710 1,219
------- ------- ------- ------- -------
Net income $ 796 $ 656 $ 2,231 $ 1,452 $ 4,726
======= ======= ======= ======= =======
Net income per share:
Basic $ 0.07 $ 0.06 $ 0.20 $ 0.13 $ 0.43
Diluted $ 0.07 $ 0.06 $ 0.19 $ 0.12 $ 0.40
Shares used in
computing net
income per
share:
Basic 11,411 11,373 10,916 11,392 10,890
Diluted 11,897 11,907 11,728 11,841 11,696
CASCADE MICROTECH, INC.
AND SUBSIDIARIES
Consolidated Balance Sheets
June 30, 2006 and December 31, 2005
June 30, Dec. 31,
2006 2005
(unaudited)
Assets
------
Current assets:
Cash and cash equivalents $ 2,008 $ 2,224
Marketable securities 46,644 48,122
Accounts receivable net of allowances of
$83,812 and $97,051 17,399 16,182
Inventories 12,445 10,889
Prepaid expenses and other 2,047 3,000
Deferred income taxes 1,745 1,699
----------- --------
Total current assets 82,288 82,116
Long-term investments 4,972 1,549
Fixed assets, net 5,712 4,422
Deferred income tax 344 336
Other assets 1,881 1,697
----------- --------
$ 95,197 $ 90,120
=========== ========
Liabilities and Stockholders' Equity
------------------------------------
Current liabilities:
Current portion of long-term debt and
capital leases $ 4 $ 8
Accounts payable 4,860 3,904
Deferred revenue 562 516
Accrued liabilities 4,116 3,087
----------- --------
Total current
liabilities 9,542 7,515
Deferred revenue 241 255
Other long-term liabilities 802 845
----------- --------
Total liabilities 10,585 8,615
----------- --------
Stockholders' equity:
Common stock, $0.01 par value; 11,415,649
and 11,328,109 shares issued and
outstanding at June 30, 2006 and
December 31, 2005 59,896 58,400
Deferred stock-based compensation - (142)
Unrealized holding gain (loss) on
investments (59) (76)
Retained earnings 24,775 23,323
----------- --------
Total stockholders'
equity 84,612 81,505
----------- --------
$ 95,197 $ 90,120
=========== ========
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