KLA-Tencor Reports Fiscal 2007 Third Quarter Results
Revenue of $716 million and EPS of $0.76
SAN JOSE, Calif.--(BUSINESS WIRE)--
KLA-Tencor Corporation (NASDAQ:KLAC) today announced operating results for its third quarter of fiscal 2007, which ended on March 31, 2007. The Company reported GAAP net income of $155 million, which included share-based compensation and other charges discussed below, and GAAP earnings per diluted share of $0.76 on revenue of $716 million in the third quarter, compared to GAAP net income of $90 million or $0.44 per diluted share on revenue of $649 million in the second quarter of fiscal 2007, and GAAP net income of $97 million or $0.47 per diluted share on revenue of $520 million in the third quarter of fiscal 2006.
Net income for the third quarter of fiscal 2007 reflects $62 million in pre-tax charges, as follows:
-- Acquisition-related charges of $18 million for amortization of
intangible assets and in-process R&D related primarily to the
acquisitions of ADE Corporation, OnWafer Technologies and
SensArray Corporation. Acquisition-related charges for the
second quarter of fiscal 2007 were $19 million.
-- Stock-based compensation charges of $29 million, compared to
$16 million for the second quarter of fiscal 2007 and $48
million for the third quarter of fiscal 2006.
-- Restatement-related charges of $15 million, including
compensation expense for non-executive related to
reimbursements for penalty taxes under Section 409A of the
Internal Revenue Code and legal and other expenses related to
the stock options investigation, shareholder litigation and
related matters. Restatement-related charges for the second
quarter of fiscal 2007 were $15 million.
"KLA-Tencor's solid financial performance this quarter reflects our focus on enabling our customers to meet their technical and economic challenges with our inspection and metrology solutions," said Rick Wallace, Chief Executive Officer of KLA-Tencor. "I thank our employees for their unwavering commitment to operational excellence, customer satisfaction and profitable growth."
KLA-Tencor ended the third quarter of fiscal 2007 with approximately eight months of product-related shipment and revenue backlog. The geographic breakdown of orders in the quarter was:
Percent of Orders
Region -------------------------
Current Historical
Quarter Average
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United States 17% 25%
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Japan 28% 25%
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Taiwan 31% 20%
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Korea, China, & Singapore 16% 20%
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Europe 8% 10%
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Cash and investments ended the quarter at $1.6 billion compared to $2.1 billion at the end of previous quarter as a result of a pre-payment of $750 million on an accelerated stock repurchase program.
KLA-Tencor will discuss its fiscal 2007 third quarter results, along with its outlook for the fourth quarter of fiscal 2007, on a conference call today beginning at 2:00 p.m. Pacific Daylight Time. A webcast of the call will be available at: www.kla-tencor.com.
Forward Looking Statements: Statements in this press release other than historical facts, such as statements regarding the benefit to customers of KLA-Tencor's products, demand for KLA-Tencor's products and the Company's future financial performance, are forward-looking statements, and are subject to the Safe Harbor provisions created by the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current information and expectations, and involve a number of risks and uncertainties. Actual results may differ materially from those projected in such statements due to various factors, including but not limited to: our ability to successfully address and resolve all issues arising from the discovery that we had retroactively priced stock options (primarily from July 1, 1997 to June 30, 2002) and had not accounted for them correctly; the demand for semiconductors; new and enhanced product offerings by competitors; cancellation of orders by customers; and changing customer demands. For other factors that may cause actual results to differ materially from those projected and anticipated in forward-looking statements in this release, please refer to the Company's Form 10-K, Form 10-Q and other filings with the Securities and Exchange Commission (including, but not limited to, the risk factors described therein).
About KLA-Tencor: KLA-Tencor is the world leader in yield management and process control solutions for semiconductor manufacturing and related industries. Headquartered in San Jose, Calif., the Company has sales and service offices around the world. An S&P 500 Company, KLA-Tencor is traded on the Nasdaq National Market under the symbol KLAC. Additional information about the Company is available on the Internet at http://www.kla-tencor.com
KLA-Tencor Corporation
Condensed Consolidated Unaudited Balance Sheets
(In thousands) March 31, June 30,
2007 2006
----------- -----------
ASSETS
Current assets:
Cash and investments $1,585,234 $2,325,796
Accounts receivable, net 499,298 439,899
Inventories 530,141 449,156
Other current assets 332,482 328,392
----------- -----------
Total current assets 2,947,155 3,543,243
Land, property and equipment, net 363,767 395,412
Goodwill and intangibles, net 465,330 70,341
Other assets 564,541 566,915
----------- -----------
Total assets $4,340,793 $4,575,911
=========== ===========
LIABILITIES, MINORITY INTEREST AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $93,805 $95,192
Deferred system profit 217,232 226,142
Unearned revenue 86,805 80,543
Other current liabilities 631,694 600,604
----------- -----------
Total current liabilities 1,029,536 1,002,481
Minority interest in subsidiary $- $5,439
Stockholders' equity:
Common stock and capital in excess of par
value 958,567 1,421,373
Prepaid stock repurchase (113,676) -
Retained earnings 2,446,446 2,137,710
Accumulated other comprehensive income 19,920 8,908
----------- -----------
Total stockholders' equity 3,311,257 3,567,991
----------- -----------
Total liabilities, minority interest, and
stockholders' equity $4,340,793 $4,575,911
=========== ===========
KLA-Tencor Corporation
Condensed Consolidated Unaudited Statements Of Operations
Three months ended Nine months ended
------------------- -----------------------
(In thousands except per March 31 March 31 March 31 March 31
share data)
2007 2006 2007 2006
--------- --------- ----------- -----------
Revenues:
Product $607,390 $429,068 $1,682,619 $1,230,201
Service 108,818 90,580 312,222 261,390
--------- --------- ----------- -----------
Total revenues 716,208 519,648 1,994,841 1,491,591
--------- --------- ----------- -----------
Costs and operating
expenses:
Cost of revenues(1) 306,751 226,575 874,642 657,927
Engineering, research and
development(1) 106,265 97,633 313,659 295,210
Selling, general and
administrative(1) 120,537 110,513 391,536 303,543
--------- --------- ----------- -----------
Total costs and operating
expenses 533,553 434,721 1,579,837 1,256,680
--------- --------- ----------- -----------
Income from operations 182,655 84,927 415,004 234,911
Interest income and other,
net 20,817 17,225 65,931 47,986
--------- --------- ----------- -----------
Income before income taxes
and minority interest 203,472 102,152 480,935 282,897
Provision for income
taxes(1) 48,546 6,388 101,551 37,041
--------- --------- ----------- -----------
Income before minority
interest 154,926 95,764 379,384 245,856
Minority interest (141) 920 1,372 2,920
--------- --------- ----------- -----------
Net income $154,785 $96,684 $380,756 $248,776
========= ========= =========== ===========
Net income per share:
Basic $0.78 $0.48 $1.91 $1.25
Diluted $0.76 $0.47 $1.87 $1.22
Weighted average number of
shares:
Basic 197,930 199,876 199,053 198,498
Diluted 203,474 205,361 203,976 204,294
(1) includes the following
amounts related to equity
awards:
Costs of revenues $6,629 $6,198 $23,218 $19,649
Engineering, research and
development $11,036 $12,488 $33,984 $38,019
Selling, general and
administrative $11,604 $29,675 $25,182 $69,258
Provision for income taxes $(9,349) $(15,247) $(25,596) $(46,320)
Source: KLA-Tencor Corporation
Released April 26, 2007