Cymer Reports Revenue, Net Income for First Quarter 2001; Pro-Forma Results in Line With Street Consensus and Company's Revised Guidance

Apr 24, 2001, 01:00 ET from Cymer, Inc.

    SAN DIEGO, April 24 /PRNewswire Interactive News Release/ --
 Cymer, Inc. (Nasdaq:   CYMI), the world's leading supplier of excimer light
 sources used in semiconductor manufacturing, today announced revenue and
 pro-forma net income for the first quarter ended March 31, 2001, which were in
 line with Wall Street's consensus estimates and the company's revised
 guidance.
     First quarter net income totaled $8,299,000, equal to $0.27 per share
 (diluted), compared to $10,174,000 or $0.33 per share (diluted) in the first
 quarter of 2000.  Total revenue for the first quarter of 2001 was $91,197,000,
 versus total revenue of $80,617,000 posted in the first quarter of the prior
 year.  These results include all costs associated with Cymer's acquisition of
 ACX during the first quarter.
     On a sequential basis, first quarter net income was 59 percent below the
 $20,233,000 or $0.68 per share (diluted) recorded for the fourth quarter of
 2000, while first quarter total revenue decreased 11 percent from the
 $102,166,000 of revenue posted in the previous quarter.
     On a pro forma basis that excludes the write-off of in-process R&D as well
 as amortization of goodwill, which were not generally reflected in Wall
 Street's consensus estimates, Cymer's first quarter net income totaled
 $12,160,000, equal to $0.40 per share (diluted).  In line with the company's
 financial guidance, the acquisition of ACX, which was completed on February
 13, 2001, resulted in a one-time expense of $5,050,000 for the write-off of
 in-process R&D.  In addition, the amortization of goodwill and intangible
 assets totaled  $465,000 for the first quarter.
     Commenting on the company's first quarter performance, Bob Akins, Cymer's
 chairman and chief executive officer, noted, "As we detailed in press releases
 issued during the first quarter, falling fab utilization rates and sharply
 reduced capital expenditures by chipmakers have had an impact on our first
 quarter results.  As we expected in this environment, our product mix
 continued to shift toward our newer, value-added products, with the
 ELS-6000(TM) and ELS-6010(TM) accounting for 79 percent of total unit
 shipments.  We expect this trend to accelerate as the year progresses, with
 the 6010 alone accounting for as much as 50 percent of shipments during the
 third quarter, and as much as 75 percent in the fourth quarter."
     Akins continued, "We shipped 128 system revenue units in the first quarter
 of 2001 compared to 138 units in the fourth quarter of 2000.  Cymer installed
 116 light sources at chipmakers and other end users in the first quarter,
 giving us an estimated 2001 year-to-date market share of 83 percent, which is
 well ahead of our internal plan.  As of March 31, 2001, the number of Cymer
 light sources installed at end users totaled 1,462."
     Bill Angus, senior vice president and chief financial officer, stated,
 "System unit shipments in the first quarter of 2001 decreased seven percent
 compared to shipments in the fourth quarter of 2000, but were in line with our
 revised guidance.  On a currency adjusted basis, light source average selling
 prices (ASPs) increased to $533,000 in the first quarter from $521,000 in last
 year's fourth quarter.  Moving forward, ASPs are expected to continue this
 upward trend and may exceed $600,000 by year end because of the anticipated
 shipment of a growing number of ELS-6010 systems as well as argon fluoride
 (ArF) systems which carry a higher selling price.  Non-systems product
 revenue, that is upgrades, consumables and service, decreased 19 percent from
 fourth quarter levels, and constituted 27 percent of first quarter revenue.
     "Gross margins declined to 47 percent and operating margins to 12 percent
 in the first quarter from 53 percent and 29 percent, respectively, in the
 fourth quarter of 2000," Angus continued.  "Operating income decreased to
 $11,111,000 in the first quarter from $29,312,000 in the fourth quarter last
 year.  Bookings in the first quarter were $78,322,000, and backlog declined
 7.5 percent to $122,804,000 at March 31, 2001 from $132,740,000 at December
 31, 2000.  The overall book-to-bill ratio was .89 in the first quarter."
     Cash and cash equivalents and short-term investments totaled $205,988,000
 as of March 31, 2001.  Capital spending and depreciation for the first quarter
 were approximately $5,382,000 and $5,592,000 respectively, compared with the
 company's actual capital expenditures and depreciation of $14,651,000 and
 $4,945,000 respectively for the fourth quarter of 2000.
     Commenting on the outlook for Cymer's market, Akins said, "The year 2001
 has brought with it increased volatility and unpredictability across a number
 of business sectors, hitting the semiconductor and capital equipment markets
 especially hard.  Our ongoing market analysis projects continued slowing in
 capacity related buys in deep ultraviolet (DUV) lithography.  With fabs
 operating at a fraction of their capacity, we anticipate more announcements by
 chipmakers of further reductions or delays in their capital spending plans for
 2001.  Given current industry conditions, including lack of visibility, we are
 not forecasting beyond the current quarter."
     Akins concluded, "On a more positive note, we cannot over-emphasize our
 belief that chipmaker purchases of the most advanced technology will be the
 single most important dynamic in the marketplace for the medium-term future.
 We expect this will be driven by spending on front-end capability-enhancing
 equipment including 300mm, copper, and advanced 200mm and 300mm DUV
 lithography tools to support the move to an increasing number of DUV layers
 needed in the manufacture of advanced semiconductor devices.  In this event,
 our technology and product leadership position us to take advantage of the
 many opportunities this downturn should present."
 
     Effects of SFAS No. 133
     Cymer believes that the adoption of SFAS No. 133, a new accounting
 standard for derivative instruments and hedging activities that took effect
 for the company on January 1, 2001, favorably distorts the current period
 financial performance at the net other income/expense line by $2,144,000.  If
 the company had reported results consistent with previous reporting it would
 have had a net decrease in pre-tax income of $2,068,000.
     Historically, by using a foreign exchange contract for every new system
 purchase order received by Cymer Japan, the company was able to preserve
 pricing and gross margins by matching revenue and expenses for each sale.
 Under SFAS No. 133, Cymer is no longer permitted to match the revenue and
 expenses through foreign currency hedges unless the company adopts a
 particularly onerous hedged accounting process, which is costly in its
 documentation and administrative requirements for a company of Cymer's size.
 Cymer believes that SFAS No. 133 will create distortions in its financial
 results and could easily confuse investors.  Cymer will continue to work with
 its accountants to find appropriate ways to comply with SFAS No. 133 while
 reporting accurate financial information at a reasonable cost.
 
     Corporate Outlook
     Because of current market conditions, including lack of visibility, Cymer
 is not forecasting beyond the end of the second quarter.  Any forecast or
 projection is subject to future revision.  Based on information available at
 this time, Cymer is currently providing the following guidance for the second
 quarter of 2001:
 
     -- Cymer anticipates a further decline in unit shipments of between
        30 percent and 35 percent, and an additional reduction in consumable
        sales of between 12 percent and 15 percent.  Therefore, total revenue
        in the second quarter could decline by between 18 percent and
        22 percent from the first quarter 2001 level.
     -- Cymer is forecasting gross margins in a range of 35 percent to
        37 percent on a pre-SFAS No. 133 basis.
     -- Cymer is targeting research and development spending in the second
        quarter at approximately 20 percent to 22 percent of total revenue, and
        anticipates selling, general and administrative (SG&A) expenses to be
        approximately 14 percent to 15 percent of revenue.
     -- Cymer expects amortization of goodwill and intangible assets to total
        $894,000 on a quarterly basis.
     -- Cymer models net other income/expense at a negative $1.2 million per
        quarter, pre-SFAS No. 133, and estimates the tax rate for the remainder
        of 2001 to be 30 percent.
     -- At the suggestion of some analysts, we will issue a mid-quarter update
        in mid-May.
 
     Forward Looking Statements
     Statements in this press release that are not strictly historical in
 nature are forward-looking statements.  These statements include, but are not
 limited to:  references to the expectation that newer products will account
 for a growing percentage of Cymer's system shipments and that ASPs will
 continue to increase; a reduction of capital spending; continued slowing in
 the capital equipment sector and additional cuts in capital spending by
 chipmakers; the importance of chipmakers purchasing the most advanced
 technology; and all of the statements under the caption "Corporate Outlook"
 above, including expected declines in system shipments and consumable sales,
 and total revenue; and gross margin, R&D expenses, SG&A expenses, and
 operating income as  percentages of revenue;  and tax rates, amortization of
 goodwill and other net income/expense.  These statements are only predictions
 based on current information and expectations and involve a number of risks
 and uncertainties.  Actual events or results may differ materially from those
 projected in such statements due to various factors, including but not limited
 to: delays or cancellations by customers of their orders; the timing of
 customer orders, shipments and acceptances; inability by the company to meet
 its production and/or product development schedules; failure by the company to
 manage its expense levels and unanticipated expenses; failure by the company
 to integrate ACX or any other businesses or products that it acquires; the
 rate at which semiconductor manufacturers take delivery of photolithography
 tools from the company's customers; the demand for semiconductors in general,
 and, in particular, for leading-edge devices with smaller geometries; and new
 and enhanced product offerings by competitors.  For a discussion of these and
 other factors which may cause our actual events or results to differ from
 those projected, please refer to the company's annual report on Form 10-K
 which was filed on March 27, 2001, as well as other subsequent filings with
 the Securities and Exchange Commission.
 
     Cymer, Inc. is the world's leading supplier of excimer laser illumination
 sources, the essential light source for deep ultraviolet (DUV)
 photolithography systems.  DUV lithography is a key enabling technology, which
 has allowed the semiconductor industry to meet the exact specifications and
 manufacturing requirements for volume production of today's advanced
 semiconductor chips.  Further information on Cymer may be obtained from the
 Company's SEC filings, the Internet at http://www.cymer.com or by contacting
 the company directly.
 
 
     Cymer, Inc.                                    Quarter ending March 31,
                                                      2000           2001
 
     Total Revenue                                $80,617,000    $91,197,000
     Net income excluding write-off
      of ACX in-process R&D and effect
      of goodwill                                                 12,160,000
     One-time write-off of ACX in-process R&D                      5,050,000
     Amortization of goodwill                                        465,000
 
     Net income                                    10,174,000      8,299,000
     Avg. diluted shares                           31,166,000     30,776,000
     Share earnings (diluted)
     Excluding write off of ACX in-process R&D
      and effect of goodwill                                           $0.40
     Share earnings (basic):
     Net income                                         $0.35          $0.28
     Share earnings (diluted):
     Net income                                         $0.33          $0.27
 
 
                                  CYMER, INC.
               CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                     (In thousands, except per share data)
 
                                                        For the three months
                                                           ended March 31
                                                         2000           2001
     REVENUES:
       Product sales                                  $80,532        $90,652
       Other                                               85            545
 
         Total revenues                                80,617         91,197
 
     COSTS AND EXPENSES:
       Cost of product sales                           46,151         48,030
       Research and development                        10,764         14,437
       Sales and marketing                              3,798          6,382
       General and administrative                       4,574          5,722
       Amortization of goodwill and intangibles             0            465
       Purchased in-process research and development        0          5,050
 
         Total costs and expenses                      65,287         80,086
 
     OPERATING INCOME                                  15,330         11,111
 
     OTHER INCOME (EXPENSE):
       Foreign currency exchange gain (loss) - net         18          1,605
       Interest and other income                        2,388          2,732
       Interest and other expense                      (2,909)        (2,906)
 
         Total other income (expense) - net              (503)         1,431
 
     INCOME BEFORE INCOME TAX PROVISION
      AND MINORITY INTEREST                            14,827         12,542
 
     INCOME TAX PROVISION                               4,448          3,763
     MINORITY INTEREST                                   (205)          (110)
 
     INCOME BEFORE CUMULATIVE CHANGE IN
      ACCOUNTING PRINCIPLE                            $10,174         $8,669
 
     CUMULATIVE CHANGE IN ACCOUNTING PRINCIPLE             $0          ($370)
 
     NET INCOME                                       $10,174         $8,299
 
     EARNINGS PER SHARE:
     Basic earnings per share:
       Before cumulative change in
        accounting principle                            $0.35          $0.29
       Cumulative change in accounting principle        $0.00         ($0.01)
       Basic earnings per share                         $0.35          $0.28
       Weighted average common shares outstanding      28,711         29,954
 
     Diluted earnings per share:
       Before cumulative change in
        accounting principle                            $0.33          $0.28
       Cumulative change in accounting principle        $0.00         ($0.01)
       Diluted earnings per share                       $0.33          $0.27
       Weighted average common and common
        equivalent shares outstanding                  31,166         30,776
 
 
                                  CYMER, INC.
                    CONSOLIDATED BALANCE SHEETS (UNAUDITED)
                       (In thousands, except share data)
 
                                                    December 31,    March 31,
     ASSETS                                             2000          2001
 
     CURRENT ASSETS:
       Cash and cash equivalents                      $79,678       $156,458
       Short-term investments                         117,017         49,530
       Accounts receivable - net                       85,569         77,584
       Foreign currency forward exchange contracts      2,664          6,292
       Inventories                                     76,887         74,041
       Deferred income taxes                           23,503         23,461
       Prepaid expenses and other                       4,571          3,011
 
         Total current assets                         389,889        390,377
 
     PROPERTY - net                                    91,080         90,527
     LONG-TERM INVESTMENTS                              8,984              0
     DEFERRED TAXES - NON-CURRENT                       6,060          5,053
     GOODWILL                                               0         12,206
     INTANGIBLE ASSETS                                      0          1,385
     OTHER ASSETS                                       5,549          5,280
 
     TOTAL ASSETS                                    $501,562       $504,828
 
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
 
     CURRENT LIABILITIES:
       Accounts payable                               $23,471        $21,023
       Accrued and other liabilities                   67,853         60,441
       Income taxes payable                            11,274          9,454
       Revolving loan                                   8,745              0
         Total current liabilities                    111,343         90,918
 
     LONG-TERM LIABILITIES:
     Convertible subordinated notes                   172,335        172,335
     Other liabilities                                  3,175          3,135
 
     MINORITY INTEREST                                  1,741          1,852
 
     COMMITMENTS AND CONTINGENCIES
 
     STOCKHOLDERS' EQUITY:
       Preferred stock - authorized 5,000,000
        shares; $.001 par value, no shares
        issued or outstanding                               0              0
       Common stock - authorized 50,000,000
        shares; $.001 par value, issued and
        outstanding 29,496,000 and 30,343,000 shares       29             30
       Paid-in capital                                145,996        169,043
       Treasury stock at cost (2,000,000
        common shares)                                (24,871)       (24,871)
       Unearned compensation                                0         (4,300)
       Accumulated other comprehensive loss            (1,691)        (5,118)
       Retained earnings                               93,505        101,804
 
         Total stockholders' equity                   212,968        236,588
 
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY      $501,562       $504,828
 
                     MAKE YOUR OPINION COUNT -  Click Here
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SOURCE Cymer, Inc.
    SAN DIEGO, April 24 /PRNewswire Interactive News Release/ --
 Cymer, Inc. (Nasdaq:   CYMI), the world's leading supplier of excimer light
 sources used in semiconductor manufacturing, today announced revenue and
 pro-forma net income for the first quarter ended March 31, 2001, which were in
 line with Wall Street's consensus estimates and the company's revised
 guidance.
     First quarter net income totaled $8,299,000, equal to $0.27 per share
 (diluted), compared to $10,174,000 or $0.33 per share (diluted) in the first
 quarter of 2000.  Total revenue for the first quarter of 2001 was $91,197,000,
 versus total revenue of $80,617,000 posted in the first quarter of the prior
 year.  These results include all costs associated with Cymer's acquisition of
 ACX during the first quarter.
     On a sequential basis, first quarter net income was 59 percent below the
 $20,233,000 or $0.68 per share (diluted) recorded for the fourth quarter of
 2000, while first quarter total revenue decreased 11 percent from the
 $102,166,000 of revenue posted in the previous quarter.
     On a pro forma basis that excludes the write-off of in-process R&D as well
 as amortization of goodwill, which were not generally reflected in Wall
 Street's consensus estimates, Cymer's first quarter net income totaled
 $12,160,000, equal to $0.40 per share (diluted).  In line with the company's
 financial guidance, the acquisition of ACX, which was completed on February
 13, 2001, resulted in a one-time expense of $5,050,000 for the write-off of
 in-process R&D.  In addition, the amortization of goodwill and intangible
 assets totaled  $465,000 for the first quarter.
     Commenting on the company's first quarter performance, Bob Akins, Cymer's
 chairman and chief executive officer, noted, "As we detailed in press releases
 issued during the first quarter, falling fab utilization rates and sharply
 reduced capital expenditures by chipmakers have had an impact on our first
 quarter results.  As we expected in this environment, our product mix
 continued to shift toward our newer, value-added products, with the
 ELS-6000(TM) and ELS-6010(TM) accounting for 79 percent of total unit
 shipments.  We expect this trend to accelerate as the year progresses, with
 the 6010 alone accounting for as much as 50 percent of shipments during the
 third quarter, and as much as 75 percent in the fourth quarter."
     Akins continued, "We shipped 128 system revenue units in the first quarter
 of 2001 compared to 138 units in the fourth quarter of 2000.  Cymer installed
 116 light sources at chipmakers and other end users in the first quarter,
 giving us an estimated 2001 year-to-date market share of 83 percent, which is
 well ahead of our internal plan.  As of March 31, 2001, the number of Cymer
 light sources installed at end users totaled 1,462."
     Bill Angus, senior vice president and chief financial officer, stated,
 "System unit shipments in the first quarter of 2001 decreased seven percent
 compared to shipments in the fourth quarter of 2000, but were in line with our
 revised guidance.  On a currency adjusted basis, light source average selling
 prices (ASPs) increased to $533,000 in the first quarter from $521,000 in last
 year's fourth quarter.  Moving forward, ASPs are expected to continue this
 upward trend and may exceed $600,000 by year end because of the anticipated
 shipment of a growing number of ELS-6010 systems as well as argon fluoride
 (ArF) systems which carry a higher selling price.  Non-systems product
 revenue, that is upgrades, consumables and service, decreased 19 percent from
 fourth quarter levels, and constituted 27 percent of first quarter revenue.
     "Gross margins declined to 47 percent and operating margins to 12 percent
 in the first quarter from 53 percent and 29 percent, respectively, in the
 fourth quarter of 2000," Angus continued.  "Operating income decreased to
 $11,111,000 in the first quarter from $29,312,000 in the fourth quarter last
 year.  Bookings in the first quarter were $78,322,000, and backlog declined
 7.5 percent to $122,804,000 at March 31, 2001 from $132,740,000 at December
 31, 2000.  The overall book-to-bill ratio was .89 in the first quarter."
     Cash and cash equivalents and short-term investments totaled $205,988,000
 as of March 31, 2001.  Capital spending and depreciation for the first quarter
 were approximately $5,382,000 and $5,592,000 respectively, compared with the
 company's actual capital expenditures and depreciation of $14,651,000 and
 $4,945,000 respectively for the fourth quarter of 2000.
     Commenting on the outlook for Cymer's market, Akins said, "The year 2001
 has brought with it increased volatility and unpredictability across a number
 of business sectors, hitting the semiconductor and capital equipment markets
 especially hard.  Our ongoing market analysis projects continued slowing in
 capacity related buys in deep ultraviolet (DUV) lithography.  With fabs
 operating at a fraction of their capacity, we anticipate more announcements by
 chipmakers of further reductions or delays in their capital spending plans for
 2001.  Given current industry conditions, including lack of visibility, we are
 not forecasting beyond the current quarter."
     Akins concluded, "On a more positive note, we cannot over-emphasize our
 belief that chipmaker purchases of the most advanced technology will be the
 single most important dynamic in the marketplace for the medium-term future.
 We expect this will be driven by spending on front-end capability-enhancing
 equipment including 300mm, copper, and advanced 200mm and 300mm DUV
 lithography tools to support the move to an increasing number of DUV layers
 needed in the manufacture of advanced semiconductor devices.  In this event,
 our technology and product leadership position us to take advantage of the
 many opportunities this downturn should present."
 
     Effects of SFAS No. 133
     Cymer believes that the adoption of SFAS No. 133, a new accounting
 standard for derivative instruments and hedging activities that took effect
 for the company on January 1, 2001, favorably distorts the current period
 financial performance at the net other income/expense line by $2,144,000.  If
 the company had reported results consistent with previous reporting it would
 have had a net decrease in pre-tax income of $2,068,000.
     Historically, by using a foreign exchange contract for every new system
 purchase order received by Cymer Japan, the company was able to preserve
 pricing and gross margins by matching revenue and expenses for each sale.
 Under SFAS No. 133, Cymer is no longer permitted to match the revenue and
 expenses through foreign currency hedges unless the company adopts a
 particularly onerous hedged accounting process, which is costly in its
 documentation and administrative requirements for a company of Cymer's size.
 Cymer believes that SFAS No. 133 will create distortions in its financial
 results and could easily confuse investors.  Cymer will continue to work with
 its accountants to find appropriate ways to comply with SFAS No. 133 while
 reporting accurate financial information at a reasonable cost.
 
     Corporate Outlook
     Because of current market conditions, including lack of visibility, Cymer
 is not forecasting beyond the end of the second quarter.  Any forecast or
 projection is subject to future revision.  Based on information available at
 this time, Cymer is currently providing the following guidance for the second
 quarter of 2001:
 
     -- Cymer anticipates a further decline in unit shipments of between
        30 percent and 35 percent, and an additional reduction in consumable
        sales of between 12 percent and 15 percent.  Therefore, total revenue
        in the second quarter could decline by between 18 percent and
        22 percent from the first quarter 2001 level.
     -- Cymer is forecasting gross margins in a range of 35 percent to
        37 percent on a pre-SFAS No. 133 basis.
     -- Cymer is targeting research and development spending in the second
        quarter at approximately 20 percent to 22 percent of total revenue, and
        anticipates selling, general and administrative (SG&A) expenses to be
        approximately 14 percent to 15 percent of revenue.
     -- Cymer expects amortization of goodwill and intangible assets to total
        $894,000 on a quarterly basis.
     -- Cymer models net other income/expense at a negative $1.2 million per
        quarter, pre-SFAS No. 133, and estimates the tax rate for the remainder
        of 2001 to be 30 percent.
     -- At the suggestion of some analysts, we will issue a mid-quarter update
        in mid-May.
 
     Forward Looking Statements
     Statements in this press release that are not strictly historical in
 nature are forward-looking statements.  These statements include, but are not
 limited to:  references to the expectation that newer products will account
 for a growing percentage of Cymer's system shipments and that ASPs will
 continue to increase; a reduction of capital spending; continued slowing in
 the capital equipment sector and additional cuts in capital spending by
 chipmakers; the importance of chipmakers purchasing the most advanced
 technology; and all of the statements under the caption "Corporate Outlook"
 above, including expected declines in system shipments and consumable sales,
 and total revenue; and gross margin, R&D expenses, SG&A expenses, and
 operating income as  percentages of revenue;  and tax rates, amortization of
 goodwill and other net income/expense.  These statements are only predictions
 based on current information and expectations and involve a number of risks
 and uncertainties.  Actual events or results may differ materially from those
 projected in such statements due to various factors, including but not limited
 to: delays or cancellations by customers of their orders; the timing of
 customer orders, shipments and acceptances; inability by the company to meet
 its production and/or product development schedules; failure by the company to
 manage its expense levels and unanticipated expenses; failure by the company
 to integrate ACX or any other businesses or products that it acquires; the
 rate at which semiconductor manufacturers take delivery of photolithography
 tools from the company's customers; the demand for semiconductors in general,
 and, in particular, for leading-edge devices with smaller geometries; and new
 and enhanced product offerings by competitors.  For a discussion of these and
 other factors which may cause our actual events or results to differ from
 those projected, please refer to the company's annual report on Form 10-K
 which was filed on March 27, 2001, as well as other subsequent filings with
 the Securities and Exchange Commission.
 
     Cymer, Inc. is the world's leading supplier of excimer laser illumination
 sources, the essential light source for deep ultraviolet (DUV)
 photolithography systems.  DUV lithography is a key enabling technology, which
 has allowed the semiconductor industry to meet the exact specifications and
 manufacturing requirements for volume production of today's advanced
 semiconductor chips.  Further information on Cymer may be obtained from the
 Company's SEC filings, the Internet at http://www.cymer.com or by contacting
 the company directly.
 
 
     Cymer, Inc.                                    Quarter ending March 31,
                                                      2000           2001
 
     Total Revenue                                $80,617,000    $91,197,000
     Net income excluding write-off
      of ACX in-process R&D and effect
      of goodwill                                                 12,160,000
     One-time write-off of ACX in-process R&D                      5,050,000
     Amortization of goodwill                                        465,000
 
     Net income                                    10,174,000      8,299,000
     Avg. diluted shares                           31,166,000     30,776,000
     Share earnings (diluted)
     Excluding write off of ACX in-process R&D
      and effect of goodwill                                           $0.40
     Share earnings (basic):
     Net income                                         $0.35          $0.28
     Share earnings (diluted):
     Net income                                         $0.33          $0.27
 
 
                                  CYMER, INC.
               CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                     (In thousands, except per share data)
 
                                                        For the three months
                                                           ended March 31
                                                         2000           2001
     REVENUES:
       Product sales                                  $80,532        $90,652
       Other                                               85            545
 
         Total revenues                                80,617         91,197
 
     COSTS AND EXPENSES:
       Cost of product sales                           46,151         48,030
       Research and development                        10,764         14,437
       Sales and marketing                              3,798          6,382
       General and administrative                       4,574          5,722
       Amortization of goodwill and intangibles             0            465
       Purchased in-process research and development        0          5,050
 
         Total costs and expenses                      65,287         80,086
 
     OPERATING INCOME                                  15,330         11,111
 
     OTHER INCOME (EXPENSE):
       Foreign currency exchange gain (loss) - net         18          1,605
       Interest and other income                        2,388          2,732
       Interest and other expense                      (2,909)        (2,906)
 
         Total other income (expense) - net              (503)         1,431
 
     INCOME BEFORE INCOME TAX PROVISION
      AND MINORITY INTEREST                            14,827         12,542
 
     INCOME TAX PROVISION                               4,448          3,763
     MINORITY INTEREST                                   (205)          (110)
 
     INCOME BEFORE CUMULATIVE CHANGE IN
      ACCOUNTING PRINCIPLE                            $10,174         $8,669
 
     CUMULATIVE CHANGE IN ACCOUNTING PRINCIPLE             $0          ($370)
 
     NET INCOME                                       $10,174         $8,299
 
     EARNINGS PER SHARE:
     Basic earnings per share:
       Before cumulative change in
        accounting principle                            $0.35          $0.29
       Cumulative change in accounting principle        $0.00         ($0.01)
       Basic earnings per share                         $0.35          $0.28
       Weighted average common shares outstanding      28,711         29,954
 
     Diluted earnings per share:
       Before cumulative change in
        accounting principle                            $0.33          $0.28
       Cumulative change in accounting principle        $0.00         ($0.01)
       Diluted earnings per share                       $0.33          $0.27
       Weighted average common and common
        equivalent shares outstanding                  31,166         30,776
 
 
                                  CYMER, INC.
                    CONSOLIDATED BALANCE SHEETS (UNAUDITED)
                       (In thousands, except share data)
 
                                                    December 31,    March 31,
     ASSETS                                             2000          2001
 
     CURRENT ASSETS:
       Cash and cash equivalents                      $79,678       $156,458
       Short-term investments                         117,017         49,530
       Accounts receivable - net                       85,569         77,584
       Foreign currency forward exchange contracts      2,664          6,292
       Inventories                                     76,887         74,041
       Deferred income taxes                           23,503         23,461
       Prepaid expenses and other                       4,571          3,011
 
         Total current assets                         389,889        390,377
 
     PROPERTY - net                                    91,080         90,527
     LONG-TERM INVESTMENTS                              8,984              0
     DEFERRED TAXES - NON-CURRENT                       6,060          5,053
     GOODWILL                                               0         12,206
     INTANGIBLE ASSETS                                      0          1,385
     OTHER ASSETS                                       5,549          5,280
 
     TOTAL ASSETS                                    $501,562       $504,828
 
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
 
     CURRENT LIABILITIES:
       Accounts payable                               $23,471        $21,023
       Accrued and other liabilities                   67,853         60,441
       Income taxes payable                            11,274          9,454
       Revolving loan                                   8,745              0
         Total current liabilities                    111,343         90,918
 
     LONG-TERM LIABILITIES:
     Convertible subordinated notes                   172,335        172,335
     Other liabilities                                  3,175          3,135
 
     MINORITY INTEREST                                  1,741          1,852
 
     COMMITMENTS AND CONTINGENCIES
 
     STOCKHOLDERS' EQUITY:
       Preferred stock - authorized 5,000,000
        shares; $.001 par value, no shares
        issued or outstanding                               0              0
       Common stock - authorized 50,000,000
        shares; $.001 par value, issued and
        outstanding 29,496,000 and 30,343,000 shares       29             30
       Paid-in capital                                145,996        169,043
       Treasury stock at cost (2,000,000
        common shares)                                (24,871)       (24,871)
       Unearned compensation                                0         (4,300)
       Accumulated other comprehensive loss            (1,691)        (5,118)
       Retained earnings                               93,505        101,804
 
         Total stockholders' equity                   212,968        236,588
 
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY      $501,562       $504,828
 
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 SOURCE  Cymer, Inc.