FEI Company Reports Strong First Quarter Profits and Solid Bookings

Apr 23, 2001, 01:00 ET from FEI Company

    HILLSBORO, Ore., April 23 /PRNewswire Interactive Press Release/ --
 FEI Company (Nasdaq:   FEIC) today announced earnings and sales for the quarter
 ended April 1, 2001. Overall sales increased 44 percent to $93.5 million
 compared to $64.7 million reported for the first quarter of 2000 and
 $94.9 million reported for the fourth quarter of 2000. Net income increased
 245 percent to $10.2 million from the $3.0 million reported for the
 first quarter of 2000 (excluding the cumulative effect of a change in
 accounting principle in the first quarter of 2000). Cash earnings per share
 (EPS excluding amortization expense for purchased intangibles) were
 $.038 per share, 153 percent better than the first quarter of 2000.
     The Company adopted SAB 101 concerning revenue recognition effective
 January 1, 2000. Excluding the effects of SAB 101, revenues were
 $97.3 million, gross margin was 47.9 percent and cash earnings per share were
 $0.42 in the quarter ended April 1, 2001 compared with revenues of
 $67.2 million, a gross margin of 40.4 percent and cash earnings per share of
 $0.14 for the first quarter of 2000.
     "Our first quarter results are excellent," commented Vahe' Sarkissian,
 FEI's president and chief executive officer. "We had a record quarter in the
 midst of a downturn and, for the first time in the Company's recent history,
 our first quarter performance exceeded that of the prior quarter."
     During the first quarter, sales increased in each of the Company's
 business segments, accompanied by solid bookings activity. Compared to last
 year's first quarter, the microelectronics segment increased sales by
 94 percent, electron optics increased 12 percent, components increased
 4 percent and service increased 20 percent. Bookings for the first quarter
 totaled $100.3 million and resulted in a book-to-bill ratio of 1.07. Backlog
 was $169.9 million as of April 1, 2001. North America accounted for 48 percent
 of the first quarter revenues, with Europe at 17 percent, and the Asia-Pacific
 region at 35 percent.
     Operating income for the first quarter increased 219 percent from the
 first quarter of 2000 to $16.9 million as a result of higher gross margins and
 lower operating expenses as a percentage of sales. Gross margins improved to
 48.1 percent from the 42.4 percent reported in the first quarter of 2000. The
 gross margin improvement was driven by shifts in product mix toward the
 microelectronics segment and also by improved margins in the electron optics
 and service segments. Operating expenses, excluding amortization of purchased
 intangibles, were 28.4 percent of sales for the current quarter, reduced from
 the 31.9 percent level in the first quarter of 2000.
     "We believe the value of our solutions for semiconductor manufacturers has
 differentiated our company," added Sarkissian. "Major technology shifts are
 driving line widths down into deep-submicron levels, increasing wafer sizes to
 300 mm and greatly increasing device complexity. FEI's 3D metrology and
 analysis solutions help our customers keep pace with technology shifts.
     "Despite our performance, we remain cautious regarding market conditions
 for the remainder of the year," added Sarkissian. "Therefore, we have taken
 measures to reduce non-critical expenditures and hiring. However, we are
 continuing to invest in research and development and customer support."
 
     About FEI:  The Structural Process Management Company(TM)
     FEI is the 3D innovator and leading supplier of Structural Process
 Management(TM) solutions to the world's technology leaders in the fields of
 semiconductors, data storage, structural biology and industry. Its range of
 industry-leading DualBeam(TM) and single column focused ion and electron beam
 products enables manufacturers and researchers to keep pace with technology
 shifts and develop next generation technologies and products. FEI's products
 allow advanced three-dimensional metrology, device editing, trimming and
 structural analysis for management of sub-micron structures including those
 found in integrated circuits, high density magnetic storage devices,
 industrial materials, chemical compounds and biological structures. FEI
 solutions also deliver enhanced production yields, lower costs and faster time
 to market-critical benefits in highly competitive markets.
     Headquartered in Hillsboro, Oregon, FEI has more than 1,500 employees
 worldwide, with additional development and manufacturing operations located in
 Peabody, Massachusetts; Eindhoven, The Netherlands; and Brno, Czech Republic.
     Except for the historical statements contained herein, the statements in
 this news release about customer adoption of the Company's product
 applications and the value and effectiveness of our products involve risks and
 uncertainties. Factors that could cause actual results to differ materially
 include, but are not limited to:  business conditions in the electronics, life
 sciences and material sciences industries and the general economy, both
 domestic and international; lower than expected customer orders; competitive
 factors, including pricing pressures, technological developments and products
 offered by competitors; technological difficulties and resource constraints
 encountered in developing new products; and the timely flow of competitive new
 products and market acceptance of those products. These and other factors that
 could cause actual results to differ materially from the forward-looking
 statements are included in the Company's filings with the SEC.
 
 
                          FEI Company and Subsidiaries
          Condensed Consolidated Statements of Operations With SAB 101
                     (In thousands, except per share data)
                                  (Unaudited)
 
                                                       Thirteen Weeks Ended
                                                     April 2,       April 1,
                                                       2000           2001
     NET SALES                                        $64,722        $93,515
 
     COST OF SALES                                     37,225         48,572
         Gross profit                                  27,497         44,943
 
     OPERATING EXPENSES:
       Research and development                         7,226          9,297
       Selling, general and administrative             13,445         17,224
       Amortization of purchased intangibles            1,538          1,538
         Total operating expenses                      22,209         28,059
 
     OPERATING INCOME                                   5,288         16,884
 
     OTHER INCOME (EXPENSE):
       Interest income                                    198            269
       Interest expense                                 (542)          (310)
       Other                                              132          (154)
         Total other expense, net                       (212)          (195)
 
     INCOME BEFORE TAXES AND CUMULATIVE EFFECT
      OF CHANGE IN ACCOUNTING PRINCIPLE                 5,076         16,689
 
     INCOME TAX EXPENSE                                 2,114          6,466
 
     NET INCOME BEFORE CUMULATIVE EFFECT OF
      CHANGE IN ACCOUNTING PRINCIPLE                    2,962         10,223
 
     CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
      PRINCIPLE, NET OF INCOME TAX BENEFIT OF
      $4,405                                          (7,499)             --
 
     NET INCOME (LOSS)                               $(4,537)        $10,223
 
     PER SHARE DATA:
       Basic:
         Net income before cumulative effect of
          change in accounting principle                $0.11          $0.36
         Net income                                   $(0.16)          $0.36
 
       Diluted:
         Net income before cumulative effect of
          change in accounting principle                $0.10          $0.34
         Net income                                   $(0.16)          $0.34
         "Cash" earnings per share (a)                  $0.15          $0.38
 
     WEIGHTED AVERAGE SHARES OUTSTANDING:
       Basic                                           27,603         28,686
       Diluted                                         28,780         29,976
 
     (a) Excluding the effects of amortization of purchased intangibles and
         cumulative effect of change in accounting principle.
 
 
                          FEI Company and Subsidiaries
        Condensed Consolidated Statements of Operations Without SAB 101
                     (In thousands, except per share data)
                                  (Unaudited)
 
                                                       Thirteen Weeks Ended
                                                     April 2,       April 1,
                                                       2000           2001
 
     NET SALES                                        $67,153        $97,284
 
     COST OF SALES                                     39,985         50,682
 
     Gross profit                                      27,168         46,602
 
     OPERATING EXPENSES:
       Research and development                         7,226          9,297
       Selling, general and administrative             13,445         17,224
       Amortization of purchased intangibles            1,538          1,538
 
         Total operating expenses                      22,209         28,059
 
     OPERATING INCOME                                   4,959         18,543
 
     OTHER INCOME (EXPENSE):
       Interest income                                    198            269
       Interest expense                                 (542)          (310)
       Other                                              132          (154)
         Total other expense, net                       (212)          (195)
 
     INCOME BEFORE TAXES                                4,747         18,348
 
     INCOME TAX EXPENSE                                 1,992          7,079
 
     NET INCOME                                        $2,755        $11,269
 
     PER SHARE DATA:
       Net income per share-basic                       $0.10          $0.39
       Net income per share-diluted                     $0.10          $0.38
       "Cash" earnings per share (a)                    $0.14          $0.42
 
     WEIGHTED AVERAGE SHARES OUTSTANDING:
       Basic                                           27,603         28,686
       Diluted                                         28,780         29,976
 
     (a) Excluding the effects of amortization of purchased intangibles.
 
     The above Condensed Consolidated Statements of Operations do not reflect
 the effects of SAB 101.
 
 
                          FEI Company and Subsidiaries
               Condensed Consolidated Balance Sheets With SAB 101
                       (In thousands, except share data)
 
                                                   December 31,     April 1,
                                                       2000           2001
                                                                   (Unaudited)
     ASSETS
     CURRENT ASSETS:
       Cash and cash equivalents                      $24,031        $33,067
       Receivables                                     83,680         91,144
       Current account with Philips                     5,266             --
       Inventories                                     59,796         70,203
       Deferred income taxes                           22,525         26,000
       Other                                            5,850          7,242
 
         Total current assets                         201,148        227,656
 
     EQUIPMENT                                         28,171         28,825
 
     PURCHASED GOODWILL AND TECHNOLOGY                 59,540         58,097
 
     OTHER ASSETS                                      25,964         24,559
 
     TOTAL                                           $314,823       $339,137
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
 
     CURRENT LIABILITIES:
       Accounts payable                               $32,682        $33,168
       Current account with Philips                        --          2,459
       Accrued payroll liabilities                     11,553          7,794
       Accrued warranty reserves                       15,202         16,039
       Deferred revenue                                20,037         26,108
       Income taxes payable                             9,982         18,162
       Other current liabilities                       20,517         20,480
 
         Total current liabilities                    109,973        124,210
 
     BANK LINE OF CREDIT BORROWINGS                     1,534            413
 
     CREDIT FACILITY WITH PHILIPS                      24,140         26,016
 
     DEFERRED INCOME TAXES                              9,984          9,400
 
     OTHER LIABILITIES                                    903            882
 
     SHAREHOLDERS' EQUITY:
       Preferred stock -- 500,000 shares
        authorized; none issued and outstanding            --             --
       Common stock -- 45,000,000 shares
        authorized; 28,488,760 and 28,580,021
        shares issued and outstanding at
        December 31, 2000 and April 1, 2001           222,547        223,916
       Note receivable from shareholder               (1,116)        (1,116)
       Accumulated deficit                           (42,874)       (32,652)
       Accumulated other comprehensive loss          (10,268)       (11,932)
 
         Total shareholders' equity                   168,289        178,216
 
     TOTAL                                           $314,823       $339,137
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X18961418
 
 

SOURCE FEI Company
    HILLSBORO, Ore., April 23 /PRNewswire Interactive Press Release/ --
 FEI Company (Nasdaq:   FEIC) today announced earnings and sales for the quarter
 ended April 1, 2001. Overall sales increased 44 percent to $93.5 million
 compared to $64.7 million reported for the first quarter of 2000 and
 $94.9 million reported for the fourth quarter of 2000. Net income increased
 245 percent to $10.2 million from the $3.0 million reported for the
 first quarter of 2000 (excluding the cumulative effect of a change in
 accounting principle in the first quarter of 2000). Cash earnings per share
 (EPS excluding amortization expense for purchased intangibles) were
 $.038 per share, 153 percent better than the first quarter of 2000.
     The Company adopted SAB 101 concerning revenue recognition effective
 January 1, 2000. Excluding the effects of SAB 101, revenues were
 $97.3 million, gross margin was 47.9 percent and cash earnings per share were
 $0.42 in the quarter ended April 1, 2001 compared with revenues of
 $67.2 million, a gross margin of 40.4 percent and cash earnings per share of
 $0.14 for the first quarter of 2000.
     "Our first quarter results are excellent," commented Vahe' Sarkissian,
 FEI's president and chief executive officer. "We had a record quarter in the
 midst of a downturn and, for the first time in the Company's recent history,
 our first quarter performance exceeded that of the prior quarter."
     During the first quarter, sales increased in each of the Company's
 business segments, accompanied by solid bookings activity. Compared to last
 year's first quarter, the microelectronics segment increased sales by
 94 percent, electron optics increased 12 percent, components increased
 4 percent and service increased 20 percent. Bookings for the first quarter
 totaled $100.3 million and resulted in a book-to-bill ratio of 1.07. Backlog
 was $169.9 million as of April 1, 2001. North America accounted for 48 percent
 of the first quarter revenues, with Europe at 17 percent, and the Asia-Pacific
 region at 35 percent.
     Operating income for the first quarter increased 219 percent from the
 first quarter of 2000 to $16.9 million as a result of higher gross margins and
 lower operating expenses as a percentage of sales. Gross margins improved to
 48.1 percent from the 42.4 percent reported in the first quarter of 2000. The
 gross margin improvement was driven by shifts in product mix toward the
 microelectronics segment and also by improved margins in the electron optics
 and service segments. Operating expenses, excluding amortization of purchased
 intangibles, were 28.4 percent of sales for the current quarter, reduced from
 the 31.9 percent level in the first quarter of 2000.
     "We believe the value of our solutions for semiconductor manufacturers has
 differentiated our company," added Sarkissian. "Major technology shifts are
 driving line widths down into deep-submicron levels, increasing wafer sizes to
 300 mm and greatly increasing device complexity. FEI's 3D metrology and
 analysis solutions help our customers keep pace with technology shifts.
     "Despite our performance, we remain cautious regarding market conditions
 for the remainder of the year," added Sarkissian. "Therefore, we have taken
 measures to reduce non-critical expenditures and hiring. However, we are
 continuing to invest in research and development and customer support."
 
     About FEI:  The Structural Process Management Company(TM)
     FEI is the 3D innovator and leading supplier of Structural Process
 Management(TM) solutions to the world's technology leaders in the fields of
 semiconductors, data storage, structural biology and industry. Its range of
 industry-leading DualBeam(TM) and single column focused ion and electron beam
 products enables manufacturers and researchers to keep pace with technology
 shifts and develop next generation technologies and products. FEI's products
 allow advanced three-dimensional metrology, device editing, trimming and
 structural analysis for management of sub-micron structures including those
 found in integrated circuits, high density magnetic storage devices,
 industrial materials, chemical compounds and biological structures. FEI
 solutions also deliver enhanced production yields, lower costs and faster time
 to market-critical benefits in highly competitive markets.
     Headquartered in Hillsboro, Oregon, FEI has more than 1,500 employees
 worldwide, with additional development and manufacturing operations located in
 Peabody, Massachusetts; Eindhoven, The Netherlands; and Brno, Czech Republic.
     Except for the historical statements contained herein, the statements in
 this news release about customer adoption of the Company's product
 applications and the value and effectiveness of our products involve risks and
 uncertainties. Factors that could cause actual results to differ materially
 include, but are not limited to:  business conditions in the electronics, life
 sciences and material sciences industries and the general economy, both
 domestic and international; lower than expected customer orders; competitive
 factors, including pricing pressures, technological developments and products
 offered by competitors; technological difficulties and resource constraints
 encountered in developing new products; and the timely flow of competitive new
 products and market acceptance of those products. These and other factors that
 could cause actual results to differ materially from the forward-looking
 statements are included in the Company's filings with the SEC.
 
 
                          FEI Company and Subsidiaries
          Condensed Consolidated Statements of Operations With SAB 101
                     (In thousands, except per share data)
                                  (Unaudited)
 
                                                       Thirteen Weeks Ended
                                                     April 2,       April 1,
                                                       2000           2001
     NET SALES                                        $64,722        $93,515
 
     COST OF SALES                                     37,225         48,572
         Gross profit                                  27,497         44,943
 
     OPERATING EXPENSES:
       Research and development                         7,226          9,297
       Selling, general and administrative             13,445         17,224
       Amortization of purchased intangibles            1,538          1,538
         Total operating expenses                      22,209         28,059
 
     OPERATING INCOME                                   5,288         16,884
 
     OTHER INCOME (EXPENSE):
       Interest income                                    198            269
       Interest expense                                 (542)          (310)
       Other                                              132          (154)
         Total other expense, net                       (212)          (195)
 
     INCOME BEFORE TAXES AND CUMULATIVE EFFECT
      OF CHANGE IN ACCOUNTING PRINCIPLE                 5,076         16,689
 
     INCOME TAX EXPENSE                                 2,114          6,466
 
     NET INCOME BEFORE CUMULATIVE EFFECT OF
      CHANGE IN ACCOUNTING PRINCIPLE                    2,962         10,223
 
     CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
      PRINCIPLE, NET OF INCOME TAX BENEFIT OF
      $4,405                                          (7,499)             --
 
     NET INCOME (LOSS)                               $(4,537)        $10,223
 
     PER SHARE DATA:
       Basic:
         Net income before cumulative effect of
          change in accounting principle                $0.11          $0.36
         Net income                                   $(0.16)          $0.36
 
       Diluted:
         Net income before cumulative effect of
          change in accounting principle                $0.10          $0.34
         Net income                                   $(0.16)          $0.34
         "Cash" earnings per share (a)                  $0.15          $0.38
 
     WEIGHTED AVERAGE SHARES OUTSTANDING:
       Basic                                           27,603         28,686
       Diluted                                         28,780         29,976
 
     (a) Excluding the effects of amortization of purchased intangibles and
         cumulative effect of change in accounting principle.
 
 
                          FEI Company and Subsidiaries
        Condensed Consolidated Statements of Operations Without SAB 101
                     (In thousands, except per share data)
                                  (Unaudited)
 
                                                       Thirteen Weeks Ended
                                                     April 2,       April 1,
                                                       2000           2001
 
     NET SALES                                        $67,153        $97,284
 
     COST OF SALES                                     39,985         50,682
 
     Gross profit                                      27,168         46,602
 
     OPERATING EXPENSES:
       Research and development                         7,226          9,297
       Selling, general and administrative             13,445         17,224
       Amortization of purchased intangibles            1,538          1,538
 
         Total operating expenses                      22,209         28,059
 
     OPERATING INCOME                                   4,959         18,543
 
     OTHER INCOME (EXPENSE):
       Interest income                                    198            269
       Interest expense                                 (542)          (310)
       Other                                              132          (154)
         Total other expense, net                       (212)          (195)
 
     INCOME BEFORE TAXES                                4,747         18,348
 
     INCOME TAX EXPENSE                                 1,992          7,079
 
     NET INCOME                                        $2,755        $11,269
 
     PER SHARE DATA:
       Net income per share-basic                       $0.10          $0.39
       Net income per share-diluted                     $0.10          $0.38
       "Cash" earnings per share (a)                    $0.14          $0.42
 
     WEIGHTED AVERAGE SHARES OUTSTANDING:
       Basic                                           27,603         28,686
       Diluted                                         28,780         29,976
 
     (a) Excluding the effects of amortization of purchased intangibles.
 
     The above Condensed Consolidated Statements of Operations do not reflect
 the effects of SAB 101.
 
 
                          FEI Company and Subsidiaries
               Condensed Consolidated Balance Sheets With SAB 101
                       (In thousands, except share data)
 
                                                   December 31,     April 1,
                                                       2000           2001
                                                                   (Unaudited)
     ASSETS
     CURRENT ASSETS:
       Cash and cash equivalents                      $24,031        $33,067
       Receivables                                     83,680         91,144
       Current account with Philips                     5,266             --
       Inventories                                     59,796         70,203
       Deferred income taxes                           22,525         26,000
       Other                                            5,850          7,242
 
         Total current assets                         201,148        227,656
 
     EQUIPMENT                                         28,171         28,825
 
     PURCHASED GOODWILL AND TECHNOLOGY                 59,540         58,097
 
     OTHER ASSETS                                      25,964         24,559
 
     TOTAL                                           $314,823       $339,137
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
 
     CURRENT LIABILITIES:
       Accounts payable                               $32,682        $33,168
       Current account with Philips                        --          2,459
       Accrued payroll liabilities                     11,553          7,794
       Accrued warranty reserves                       15,202         16,039
       Deferred revenue                                20,037         26,108
       Income taxes payable                             9,982         18,162
       Other current liabilities                       20,517         20,480
 
         Total current liabilities                    109,973        124,210
 
     BANK LINE OF CREDIT BORROWINGS                     1,534            413
 
     CREDIT FACILITY WITH PHILIPS                      24,140         26,016
 
     DEFERRED INCOME TAXES                              9,984          9,400
 
     OTHER LIABILITIES                                    903            882
 
     SHAREHOLDERS' EQUITY:
       Preferred stock -- 500,000 shares
        authorized; none issued and outstanding            --             --
       Common stock -- 45,000,000 shares
        authorized; 28,488,760 and 28,580,021
        shares issued and outstanding at
        December 31, 2000 and April 1, 2001           222,547        223,916
       Note receivable from shareholder               (1,116)        (1,116)
       Accumulated deficit                           (42,874)       (32,652)
       Accumulated other comprehensive loss          (10,268)       (11,932)
 
         Total shareholders' equity                   168,289        178,216
 
     TOTAL                                           $314,823       $339,137
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X18961418
 
 SOURCE  FEI Company