Exhibit
99.1
News
Release
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Company Contacts:
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Jeff Hall |
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Chief Financial Officer |
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(408) 875-6800 |
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jeff.hall@kla-tencor.com |
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Charlie Webster (Investment Community) |
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Vice President, Finance & Treasury |
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(408) 875-5061 |
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charlie.webster@kla-tencor.com |
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Kyra Whitten (Media) |
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Senior Director, Corporate Communications |
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(408) 875-7819 |
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kyra.whitten @kla-tencor.com |
FOR IMMEDIATE RELEASE
KLA-TENCOR REPORTS THIRD QUARTER OF FISCAL 2006 EARNINGS PER SHARE OF $0.48
($0.63 EXCLUDING EQUITY BASED COMPENSATION) ON REVENUE OF $518 MILLION
SAN JOSE, Calif., April 27, 2006—KLA-Tencor Corporation (NASDAQ: KLAC) today announced
operating results for its third quarter of fiscal 2006, ended March 31, 2006. The company
reported net income of $98 million and earnings per diluted share of $0.48 on revenues of
$518 million compared to net income of $77 million or $0.38 per diluted share on revenue of
$488 million in the second quarter of fiscal 2006, and net income of $123 million or $0.61
per diluted share on revenue of $542 million in the third quarter of fiscal 2005. The
results for the fiscal 2006 quarters include the impact from adoption of SFAS 123 (R) “Stock
Based Compensation”. The company recorded after tax equity based compensation expenses of
$31 million during the third quarter of fiscal 2006 and $25 million during the second
quarter of fiscal 2006, in its costs and operating expenses. Excluding the impact of equity
based compensation, net income would have been $129 million or $0.63 per diluted share for
the third quarter of fiscal 2006 and $102 million or $0.50 per diluted share in the second
quarter of fiscal 2006.
“We had a quarter of strong financial results, as semiconductor manufacturers continue
to make investments in our leading-edge process control solutions in order to reduce the
time and costs associated with producing next-generation devices,” stated Rick Wallace,
chief executive officer of KLA-Tencor. “We remain focused on investing in the solutions our
customers will need in order to remain competitive as next-generation applications enter
production.”
KLA-Tencor reported ending the quarter with approximately nine months of product-related
shipment and revenue backlog. On a geographic basis, U.S. was 33 percent of orders, higher
than its historical average of 25 percent; Japan was 26 percent of orders, higher than its
historical average of 20 percent; Taiwan was 14 percent of orders, lower than its historical
average of 20 percent; Korea, China and Singapore were 16 percent of orders, below their
combined historical average of 20 percent; and Europe was 11 percent of orders, lower than
its historical average of 15 percent.
-more-
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| KLA-TENCOR REPORTS RESULTS FOR Q3/FISCAL YEAR 2006
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Page 2 of 2 |
KLA-Tencor’s financial position remained strong with cash, cash equivalents and marketable
securities of $2.3 billion and no long term debt. Inventory increased by $27 million
compared to the prior quarter to $438 million as build plans ramp to meet increased customer
demand. Accounts receivable increased by $84 million compared to the prior quarter to $456
million on higher shipments.
Forward Looking Statements: Statements in this press release regarding the benefit to
customers of KLA-Tencor’s products, demand for KLA-Tencor’s products and its 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: the
demand for semiconductors and 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, please refer to the
company’s Form 10-K, Forms 10-Q and other filings with the Securities and Exchange
Commission. Actual results could differ materially from those anticipated in
forward-looking statements in this release as a result of certain factors, including those
set forth in the risk factors described in the company’s SEC filings.
For comparison purposes, the company makes reference to certain net income and earnings per
share results that were consistent with GAAP when presented in prior quarters, but are now
inconsistent with GAAP due to changes in accounting standards. These results were reached
by excluding non-cash, equity-based compensation expenses. We reference those results to
allow a better comparison of results in the current period to those in prior periods. Our
reference to these results from prior periods should be considered in addition to results
that are prepared under current accounting standards but should not be considered a
substitute for results that are presented as consistent with GAAP.
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 was named one of the Best Managed Companies in America for 2005 by
Forbes Magazine and is the only company in the semiconductor industry to receive the
accolade for this year. 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 STATEMENTS OF OPERATIONS
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Three months ended |
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Nine months ended |
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March 31, |
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March 31, |
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2006 |
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2005 |
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2006 |
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2005 |
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Revenues: |
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Product |
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$ |
427,676 |
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$ |
463,171 |
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$ |
1,229,346 |
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$ |
1,360,412 |
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Service |
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90,580 |
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78,440 |
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260,740 |
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232,825 |
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Total revenues |
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518,256 |
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541,611 |
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1,490,086 |
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1,593,237 |
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Costs and operating expenses: |
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Costs of revenues* |
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226,620 |
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221,838 |
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657,943 |
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655,042 |
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Engineering, research and
development* development |
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95,927 |
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88,812 |
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291,005 |
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253,120 |
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Selling, general and
administrative* |
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108,364 |
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76,114 |
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296,440 |
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217,753 |
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Total costs and operating expenses |
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430,911 |
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386,764 |
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1,245,388 |
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1,125,915 |
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Income from operations |
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87,345 |
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154,847 |
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244,698 |
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467,322 |
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Interest income and other, net |
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17,225 |
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7,292 |
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48,686 |
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22,054 |
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Income before income taxes and minority
interest |
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104,570 |
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162,139 |
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293,384 |
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489,376 |
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Provision for income taxes* |
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7,347 |
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40,065 |
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44,834 |
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130,055 |
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Income before minority interest |
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97,223 |
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122,074 |
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248,550 |
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359,321 |
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Minority interest |
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920 |
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1,089 |
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2,920 |
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2,324 |
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Net income |
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$ |
98,143 |
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$ |
123,163 |
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$ |
251,470 |
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$ |
361,645 |
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Net income per share: |
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Basic |
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$ |
0.49 |
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$ |
0.63 |
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$ |
1.27 |
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1.84 |
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Diluted |
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$ |
0.48 |
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$ |
0.61 |
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$ |
1.23 |
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1.80 |
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Weighted average number of shares: |
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Basic |
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199,876 |
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196,883 |
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198,498 |
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196,244 |
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Diluted |
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204,818 |
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202,329 |
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203,696 |
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201,058 |
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*includes the following amounts related to equity awards
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Costs of revenues |
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$ |
6,243 |
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$ |
— |
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$ |
19,666 |
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$ |
— |
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Engineering, research and development |
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10,782 |
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25 |
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33,815 |
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523 |
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Selling, general and
administrative |
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27,526 |
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773 |
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62,152 |
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1,394 |
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Provision for income taxes |
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(13,763 |
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(295 |
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(34,861 |
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(709 |
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Total |
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$ |
30,788 |
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503 |
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$ |
80,772 |
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$ |
1,208 |
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