Ultra Clean Reports Third Quarter Financial Results Company delivers strong gross margin performance and EPS at the high-end of guidance

HAYWARD, Calif., Oct. 21, 2013 /PRNewswire/ -- Ultra Clean Holdings, Inc. (Nasdaq: UCTT), a leading developer and supplier of critical systems and subsystems for the semiconductor capital equipment, flat panel, medical, energy and research industries, today reported its financial results for the third quarter ended September 27, 2013.

Revenue for the third quarter of 2013 was $107.2 million, a decrease of 2.7% compared to the second quarter of 2013 and an increase of 6.3% compared to the same period a year ago.  Semiconductor revenue was 88.4% of total revenue and revenue outside the U.S. accounted for 33.1% of total revenue for the third quarter of 2013. Gross margin was 14.8%, compared to 14.6% for the previous quarter and 14.2% for the same period a year ago.

The Company recorded net income of $2.0 million, or $0.07 per share in the third quarter of 2013 compared to net income of $2.3 million, or $0.08 per share, in the previous quarter and a net loss of $1.1 million, or $(0.04) per share, for the same period a year ago. The net income for the third quarter of 2013 includes pre-tax charges of $1.5 million for amortization costs associated with the AIT transaction. Excluding these charges the Company would have reported earnings of $0.12 per share. The Company's tax rate for the third quarter of 2013 was 15.5%.

Cash at the end of the third quarter of fiscal year 2013 was $65.9 million, a decrease of $5.4 million from the previous quarter.  Outstanding debt was $56.5 million at the end of the third quarter of fiscal year 2013, a decrease of $11.9 million from the previous quarter. 

Clarence Granger, Ultra Clean's Chairman and Chief Executive Officer, stated: "Our net liquidity increased by nearly $6.5 million from the previous quarter as we continue to generate cash through operations and significantly reduce our bank debt. Our gross margins were the highest since the second quarter of 2007.  Overall, I am pleased with the strength of our balance sheet, the progress we are making on gross margin, and our business outlook into the future."

Commenting on Ultra Clean's corporate guidance, Granger noted: "We expect revenue for the fourth quarter of 2013 to range between $120 million to $125 million, with earnings per share in the range of $0.14 to $0.18. Excluding amortization associated with the merger with AIT we expect earnings per share to be in the range of $0.18 to $0.22. We are forecasting a tax rate of 20% for the fourth quarter."

Ultra Clean will conduct a conference call today, Monday, October 21, beginning at 1:45 p.m. PDT. The call-in number is (888) 561-5097 (domestic) and (706) 679-7569 (international).  A replay of the conference will be available for fourteen days following the call at (855) 859-2056 (domestic) and (404) 537-3406 (international).  The confirmation number for live broadcast and replay is 73327438 (all callers). 

About Ultra Clean Holdings, Inc.

Ultra Clean Holdings, Inc. is a leading developer and supplier of critical systems and subsystems for the semiconductor capital equipment, flat panel, medical, energy and research industries. Ultra Clean offers its customers an integrated outsourced solution for gas delivery systems and other subassemblies, improved design-to-delivery cycle times, component neutral design and manufacturing and component testing capabilities. Ultra Clean's customers are primarily original equipment manufacturers for the semiconductor capital equipment, flat panel, medical, energy and research industries. Ultra Clean is headquartered in Hayward, California. Additional information is available at www.uct.com

Safe Harbor Statement

The foregoing information contains, or may be deemed to contain, "forward-looking statements" (as defined in the US Private Securities Litigation Reform Act of 1995) which reflect our current views with respect to future events and financial performance. We use words such as "anticipates," "projection," "forecast," "believes," "plan," "expect," "future," "intends," "may," "will," "estimates," "predicts,"  and similar expressions to identify these forward-looking statements. Forward looking statements included in this press release include our expectations with respect to fourth quarter 2013 revenue and earnings per share and our forecasted tax rate for the fourth quarter of fiscal 2013 and the full fiscal year 2013, our expectations regarding our integration with AIT. All forward-looking statements address matters that involve risks and uncertainties. Accordingly, the Company's actual results may differ materially from the results predicted or implied by these forward- looking statements. These risks, uncertainties and other factors also include, among others, those identified in "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations'' and elsewhere in our annual report on Form 10-K for the year ended December 28, 2012 and our quarterly report on Form 10-Q for the quarter ended June 28, 2013, each as filed with the Securities and Exchange Commission. Additional information will also be set forth in our quarterly report on Form 10-Q for the quarter ended September 27, 2013.  Ultra Clean Holdings, Inc. undertakes no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise unless required by law.

 

Ultra Clean Holdings, Inc

Condensed Consolidated Statements of Income

(Unaudited; in thousands, except per share data)










For the three months ended


For the nine months ended

September 27, 2013


September 28, 2012


September 27, 2013


September 28, 2012









Sales

$ 107,183


$ 100,849


$ 317,754


$ 313,363









Cost of goods sold

91,350


86,526


271,995


269,126









Gross profit

15,833


14,323


45,759


44,237









Operating expenses:








Research and development

1,410


1,309


4,156


4,003

Sales and marketing

2,561


1,805


7,344


5,215

General and administrative

8,471


9,812


26,619


22,893

Acquistions costs

-


2,063


-


2,063

     Total operating expenses

12,442


14,989


38,119


34,174









Income (loss) from operations

3,391


(666)


7,640


10,063









Interest and other income (expense), net

(968)


(813)


(2,656)


(932)









Income (loss) before income taxes

2,423


(1,479)


4,984


9,131









Income tax provision (benefit)

375


(356)


931


2,804









Net income (loss)

$ 2,048


$ (1,123)


$ 4,053


$ 6,327









Net income (loss) per share:








Basic

$ 0.07


$ (0.04)


$ 0.14


$ 0.25

Diluted

$ 0.07


$ (0.04)


$ 0.14


$ 0.25









Shares used in computing net income (loss) per share:















Basic

28,451


27,656


28,265


24,851

Diluted

28,979


27,656


28,879


25,493

 

Ultra Clean Holdings, Inc

Condensed Consolidated Balance Sheets

 (Unaudited; in thousands)






September 27,


December 28,

ASSETS

2013


2012





Current assets:




   Cash and cash equivalents

$            65,941


$           54,311

   Accounts receivable

49,728


50,074

   Inventory

50,293


53,965

   Other current assets

7,065


6,769

      Total current assets

173,027


165,119





Equipment and leasehold improvements, net

8,756


9,282

Goodwill

55,918


56,662

Purchased intangibles, net

23,235


27,702

Other non-current assets

6,417


7,164

Total assets

$          267,353


$         265,929





LIABILITIES & STOCKHOLDERS' EQUITY




Current liabilities:




Bank borrowings

$            36,706


$           48,706

Accounts payable

37,770


23,485

Other current liabilities

6,459


7,045

      Total current liabilities

80,935


79,236

Bank debt and other long-term liabilities

23,002


29,913

      Total liabilities

103,937


109,149





Stockholders' equity:




Common stock

142,426


139,843

Retained Earnings

20,990


16,937

   Total stockholders' equity

163,416


156,780

Total liabilities and stockholders' equity

$          267,353


$         265,929

SOURCE Ultra Clean Holdings, Inc.



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