FEI Third Quarter EPS of $0.16 Up 60% Sequentially
Bookings of $149.7 Million and Revenue of $140.8 Million
- Press Release
- Source: FEI Company
- On 4:00 pm EST, Tuesday November 3, 2009
HILLSBORO, Ore., Nov. 3, 2009 (GLOBE NEWSWIRE) -- FEI Company (Nasdaq:FEIC - News) reported increased earnings on comparable revenue for the third quarter ended October 4, 2009. Earnings per share exceeded company guidance, revenue was near the high end of guidance and the book-to-bill ratio in the quarter was 1.06 to 1.
Related Quotes
| Symbol | Price | Change |
|---|---|---|
| FEIC | 24.89 | +0.09 |
For the quarter, net bookings were $149.7 million, including a $6.3 million upward revaluation of the backlog of unfilled orders due to changes in foreign exchange rates. Total bookings were 5% below second-quarter bookings of $157.8 million and 15% below last year's record third quarter total of $175.3 million. Net sales of $140.8 million were up slightly compared to the second quarter of 2009 and down 1% from the third quarter of 2008. The backlog at the end of the quarter was a record $345.7 million, of which approximately 90% is expected to ship in the next 12 months.
Net income for the third quarter of 2009 was $6.1 million, up 66% compared with $3.7 million in the second quarter of 2009 and up 53% compared with $3.9 million in last year's third quarter. Diluted earnings per share in the latest quarter were $0.16, compared with $0.10 in the second quarter of 2009 and $0.11 in the third quarter of 2008. Operating income in the quarter was $7.9 million, compared with $6.6 million in the second quarter of 2009 and $6.2 million in last year's third quarter. Restructuring expenses in the latest quarter reduced operating income by $0.6 million or $0.01 per diluted share. The tax rate for the latest quarter was 14.5%, compared with 28.4% in the second quarter and 29.8% in last year's third quarter.
During the quarter the company continued to improve its balance sheet and liquidity. Total cash and investments increased by $19.9 million in the quarter to $403.9 million, and shareholders' equity increased by $20.5 million to $564.0 million. Net cash provided by operating activities was positive $20.0 million for the quarter.
"FEI performed well in a seasonally weak quarter," said Don Kania, president and CEO of FEI. "Bookings were solid, as strength in Research and Industry, including orders related to U.S. science-based stimulus funding for science investment, offset expected variability in Electronics and Life Sciences. We expect improved bookings, revenue and earnings in the fourth quarter. Despite the weakening dollar, we expect to enter 2010 with good momentum, based on a record backlog, ongoing stimulus funding and an array of recently introduced new products."
Bookings and revenue comparisons for the company's market segments and other data are included in the supplementary information attached to this release, along with detailed statements of operations and balance sheets.
Results for the first nine months of 2008 have been adjusted for the effect of the required adoption on January 1, 2009 of guidance within the FASB's Accounting Standards Codification, Section 470-20, "Debt-Debt with Conversion and Other Options" -- formerly FSP No. APB 14-1, "Accounting for Convertible Debt Instruments That May Be Settled in Cash Upon Conversion (Including Partial Cash Conversion)". The restatement reduced reported net income and diluted earnings per share for last year's first three quarters by $6.3 million and $0.15 per share. The restatement is related to the company's zero percent convertible notes. Because the notes were paid off in June 2008, there was no restatement of the Statement of Operations for the third quarter of 2008 or later periods.
Guidance for Q4 2009
Assuming a euro/dollar exchange rate of $1.45, FEI expects net sales in the fourth quarter of 2009 to be in the range of $145 million to $152 million. Bookings are expected to be at least $150 million. GAAP earnings per share are expected to be in the range of $0.16 to $0.21, including estimated restructuring charges of approximately $0.03 per share.
Investor Conference Call -- 2:00 p.m. Pacific time, Tuesday, November 3, 2009
Parties interested in listening to FEI's quarterly conference call may do so by dialing 1-877-941-1848 (domestic, toll-free) or 1-480-629-9722 (international) and asking for the FEI Third Quarter Earnings call, # 4175238. The call can also be accessed via the web by going to FEI's Investor Relations page at www.fei.com, where the webcast will also be archived. A telephone replay of the call will also be accessible for one month by dialing 1-800-406-7325 (U.S.) or 1-303-590-3030 (international) and entering the access code 4175238#.
About FEI
FEI (Nasdaq:FEIC - News) is a leading diversified scientific instruments company. It is a premier provider of electron and ion-beam microscopes and tools for nanoscale applications across many industries: industrial and academic materials research, life sciences, semiconductors, data storage, natural resources and more. With a 60-year history of technological innovation and leadership, FEI has set the performance standard in transmission electron microscopes (TEM), scanning electron microscopes (SEM) and DualBeams(TM), which combine a SEM with a focused ion beam (FIB). FEI's imaging systems provide 3D characterization, analysis and modification/prototyping with resolutions down to the sub-Angstrom (one-tenth of a nanometer) level. FEI's NanoPorts in North America, Europe and Asia provide centers of technical excellence where its world-class community of customers and specialists collaborate. FEI has approximately 1,800 employees and sales and service operations in more than 50 countries around the world. More information can be found at: www.fei.com.
The FEI Company logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6379
Safe Harbor Statement
This news release contains forward-looking statements that include our guidance for the fourth quarter of 2009 and future periods; the expected shipment of our backlog; expectations about operating expenses and restructuring expense; expectations for future revenue, earnings, bookings and backlog; expectations about foreign currency rates and the impact on our results; government economic stimulus spending; and product sales and performance, and performance of certain market segments. Factors that could affect these forward-looking statements include, but are not limited to, the global economic environment; the timing, size, execution and ultimate success of government stimulus programs; lower than expected customer orders and the potential weakness of the Research & Industry, Electronics and Life Sciences market segments; bankruptcy or insolvency of customers or suppliers; cyclical changes in the data storage and semiconductor industries, which are the major components of Electronics market revenue; fluctuations in foreign exchange, interest and tax rates; changes in tax rate and laws and accounting rules regarding taxes; the ongoing determination of the effectiveness of foreign exchange hedge transactions; valuation of the auction rate securities we hold and classification of them on the balance sheet; reduced profitability due to failure to achieve or sustain margin improvement in service or product manufacturing; the relative mix of higher-margin and lower-margin products; failure to achieve expected cost reductions and other improvements from restructuring plans; risks associated with shipping a high percentage of the company's quarterly revenue in the last month of the quarter; customer requests to defer planned shipments; failure of customers to adopt new technologies; increased competition and new product offerings from competitors; lower average sales prices and reduced margins on some product sales due to increased competition; failure of the company's products and technology to find acceptance with customers; delays in new product introduction and the inability to manufacture products in required volumes; inability to deploy products as expected or delays in shipping products due to technical problems or barriers; shipment delays due to supply chain problems; changes to or potential additional restructurings and reorganizations not presently anticipated; reduced sales due to geopolitical risks; changes in trade policies and tariff regulations; changes in the regulatory environment in the nations where we do business; additional selling, general and administrative or research and development expenses; additional costs related to future merger and acquisition activity; and failure of the company to achieve anticipated benefits of acquisitions and collaborations, including failure to achieve financial goals and integrate future acquisitions successfully. Please also refer to our Form 10-K, Forms 10-Q, Forms 8-K and other filings with the U.S. Securities and Exchange Commission for additional information on these factors and other factors that could cause actual results to differ materially from the forward-looking statements. FEI assumes no duty to update forward-looking statements.
FEI Company and Subsidiaries
Consolidated Balance Sheets
(In thousands)
(Unaudited)
As
Adjusted(1)
October 4, July 5, December 31,
2009 2009 2008
---------- ---------- ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 147,202 $ 178,879 $ 146,521
Short-term investments in
marketable securities 207,360 145,739 32,901
Short-term restricted cash 9,984 10,783 10,994
Receivables 163,045 162,771 139,733
Inventories 152,565 147,798 141,609
Deferred tax assets 2,718 2,651 2,884
Other current assets 46,970 52,921 32,926
---------- ---------- ------------
Total current assets 729,844 701,542 507,568
Non-current investments in
marketable securities 12,882 6,300 94,098
Long-term restricted cash 26,475 42,344 34,833
Non-current inventories 42,362 41,468 41,072
Property plant and equipment,
net 81,018 76,860 76,991
Goodwill 44,626 44,600 40,964
Deferred tax assets 1,545 1,618 2,188
Other assets, net 15,879 18,667 34,458
---------- ---------- ------------
TOTAL $ 954,631 $ 933,399 $ 832,172
========== ========== ============
LIABILITIES AND SHAREHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable $ 38,310 $ 36,108 $ 34,964
Accrued liabilities 37,147 37,138 35,540
Deferred revenue 63,697 69,341 44,135
Income taxes payable 2,591 3,318 3,040
Accrued restructuring,
reorganization and relocation 34 86 240
Short-term line of credit 70,800 70,800 --
Other current liabilities 42,926 40,600 33,732
---------- ---------- ------------
Total current liabilities 255,505 257,391 151,651
Convertible debt 100,000 100,000 115,000
Other liabilities 35,163 32,546 46,432
SHAREHOLDERS' EQUITY:
Preferred stock - 500 shares
authorized; none issued and
outstanding -- -- --
Common stock - 70,000 shares
authorized; 37,674, 37,553,
and 37,286 shares issued and
outstanding at October 4, 2009,
July 5, 2009, and
December 31, 2008 479,670 478,075 469,893
Retained earnings (deficit) 14,890 8,830 (1,168)
Accumulated other comprehensive
income 69,403 56,557 50,364
---------- ---------- ------------
Total shareholders' equity 563,963 543,462 519,089
---------- ---------- ------------
TOTAL $ 954,631 $ 933,399 $ 832,172
========== ========== ============
(1) As adjusted for the effects of Accounting Standards Codification
470-20 "Debt - Debt with Conversion and Other Options."
FEI Company and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Thirty-Nine Weeks
Thirteen Weeks Ended Ended
----------------------------- -------------------
As
Adjusted
(1)
Oct.4, July 5, Sept. 28, Oct. 4, Sept. 28,
2009 2009 2008 2009 2008
--------- --------- --------- --------- ---------
NET SALES:
Products $105,562 $107,162 $106,631 $321,286 $343,603
Service and
components 35,237 33,101 35,137 101,609 103,850
--------- --------- --------- --------- ---------
Total net sales 140,799 140,263 141,768 422,895 447,453
--------- --------- --------- --------- ---------
COST OF SALES:
Products 61,658 61,127 60,385 182,672 197,752
Service and
components 23,760 22,975 24,681 69,989 75,154
--------- --------- --------- --------- ---------
Total cost of
sales 85,418 84,102 85,066 252,661 272,906
--------- --------- --------- --------- ---------
Gross profit 55,381 56,161 56,702 170,234 174,547
--------- --------- --------- --------- ---------
OPERATING EXPENSES:
Research and
development 16,705 16,657 17,168 50,142 53,471
Selling, general
and administrative 30,176 31,825 32,140 94,827 97,671
Restructuring,
reorganization and
relocation 601 1,067 1,176 2,630 3,447
--------- --------- --------- --------- ---------
Total operating
expenses 47,482 49,549 50,484 147,599 154,589
--------- --------- --------- --------- ---------
OPERATING INCOME 7,899 6,612 6,218 22,635 19,958
--------- --------- --------- --------- ---------
OTHER INCOME
(EXPENSE):
Interest income 498 668 2,710 2,299 11,827
Interest expense (1,191) (1,195) (1,689) (4,298) (12,484)
Other, net (116) (974) (1,612) (631) (2,852)
--------- --------- --------- --------- ---------
Total other income
(expense), net (809) (1,501) (591) (2,630) (3,509)
--------- --------- --------- --------- ---------
INCOME BEFORE TAXES 7,090 5,111 5,627 20,005 16,449
INCOME TAX EXPENSE 1,030 1,451 1,679 3,947 5,810
--------- --------- --------- --------- ---------
NET INCOME $ 6,060 $ 3,660 $ 3,948 $ 16,058 $ 10,639
========= ========= ========= ========= =========
BASIC NET INCOME PER
SHARE DATA: $ 0.16 $ 0.10 $ 0.11 $ 0.43 $ 0.29
======== ======== ======== ======== ========
DILUTED NET INCOME
PER SHARE DATA: $ 0.16 $ 0.10 $ 0.11 $ 0.43 $ 0.29
======== ======== ======== ======== ========
WEIGHTED AVERAGE
SHARES OUTSTANDING:
Basic 37,610 37,450 36,780 37,461 36,571
======== ======== ======== ======== ========
Diluted 38,067 37,745 37,286 37,810 37,027
======== ======== ======== ======== ========
(1) As adjusted for the effects of Accounting Standards Codification
470-20 "Debt - Debt with Conversion and Other Options."
FEI Company and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
Thirty-Nine Weeks
Thirteen Weeks Ended(1) Ended(1)
----------------------------- -------------------
As
Adjusted
(2)
Oct. 4, July 5, Sept. 28, Oct. 4, Sept. 28,
2009 2009 2008 2009 2008
--------- --------- --------- --------- ---------
NET SALES:
Products 75.0% 76.4% 75.2% 76.0% 76.8%
Service and
components 25.0% 23.6% 24.8% 24.0% 23.2%
--------- --------- --------- --------- ---------
Total net sales 100.0% 100.0% 100.0% 100.0% 100.0%
--------- --------- --------- --------- ---------
COST OF SALES:
Products 43.8% 43.6% 42.6% 43.2% 44.2%
Service and
components 16.9% 16.4% 17.4% 16.5% 16.8%
--------- --------- --------- --------- ---------
Total cost of
sales 60.7% 60.0% 60.0% 59.7% 61.0%
--------- --------- --------- --------- ---------
Gross profit 39.3% 40.0% 40.0% 40.3% 39.0%
--------- --------- --------- --------- ---------
OPERATING EXPENSES:
Research and
development 11.9% 11.9% 12.1% 11.9% 12.0%
Selling, general
and administrative 21.4% 22.7% 22.7% 22.4% 21.8%
Restructuring,
reorganization and
relocation 0.4% 0.8% 0.8% 0.6% 0.8%
--------- --------- --------- --------- ---------
Total operating
expenses 33.7% 35.3% 35.6% 34.9% 34.5%
--------- --------- --------- --------- ---------
OPERATING INCOME 5.6% 4.7% 4.4% 5.4% 4.5%
--------- --------- --------- --------- ---------
OTHER INCOME
(EXPENSE):
Interest income 0.4% 0.5% 1.9% 0.5% 2.6%
Interest expense -0.9% -0.9% -1.2% -1.0% -2.8%
Other, net -0.1% -0.7% -1.1% -0.1% -0.6%
--------- --------- --------- --------- ---------
Total other income
(expense), net -0.6% -1.1% -0.4% -0.6% -0.8%
--------- --------- --------- --------- ---------
INCOME BEFORE TAXES 5.0% 3.6% 4.0% 4.7% 3.7%
--------- --------- --------- --------- ---------
INCOME TAX EXPENSE 0.7% 1.0% 1.2% 0.9% 1.3%
--------- --------- --------- --------- ---------
NET INCOME 4.3% 2.6% 2.8% 3.8% 2.4%
--------- --------- --------- --------- ---------
(1) Percentages may not add due to rounding.
(2) As adjusted for the effects of Accounting Standards Codification
470-20 "Debt - Debt with Conversion and Other Options."
FEI COMPANY
Supplemental Data Table
($ in millions, except per share amounts)
(Unaudited)
---------------------------------------------------------------------
Q3 Ended Q2 Ended Q3 Ended
4-Oct-09 5-Jul-09 28-Sep-2008
---------------------------------------------------------------------
Income Statement Highlights
---------------------------------------------------------------------
Consolidated sales $140.8 $140.3 $141.8
---------------------------------------------------------------------
Gross margin 39.3% 40.0% 40.0%
---------------------------------------------------------------------
Stock compensation expense -
TOTAL $2.4 $2.7 $1.9
---------------------------------------------------------------------
Net income $6.1 $3.7 $3.9
---------------------------------------------------------------------
Diluted net income per share $0.16 $0.10 $0.11
---------------------------------------------------------------------
Interest income add back
included in the calculation
of diluted EPS $0.0 $0.0 $0.0
---------------------------------------------------------------------
Sales by Market Segment
---------------------------------------------------------------------
Electronics $31.7 $32.3 $35.4
---------------------------------------------------------------------
Research & Industry $61.6 $55.3 $47.9
---------------------------------------------------------------------
Life Sciences $12.3 $19.6 $23.4
---------------------------------------------------------------------
Service and Components $35.2 $33.1 $35.1
---------------------------------------------------------------------
Sales by Geography
---------------------------------------------------------------------
USA & Canada $46.4 $40.4 $52.6
---------------------------------------------------------------------
Europe $48.3 $40.7 $48.5
---------------------------------------------------------------------
Asia-Pacific and Rest of World $46.1 $59.2 $40.7
---------------------------------------------------------------------
Bookings
---------------------------------------------------------------------
Total $149.7 $157.8 $175.3
---------------------------------------------------------------------
Book-to-bill ratio 1.06 1.13 1.24
---------------------------------------------------------------------
Backlog - total $345.7 $336.9 $329.5
---------------------------------------------------------------------
Backlog - Service and
Components $64.3 $64.1 $59.8
---------------------------------------------------------------------
Bookings by Market Segment
---------------------------------------------------------------------
Electronics $22.5 $35.1 $51.2
---------------------------------------------------------------------
Research & Industry $80.4 $57.4 $68.0
---------------------------------------------------------------------
Life Sciences $11.4 $30.6 $25.9
---------------------------------------------------------------------
Service and Components $35.4 $34.7 $30.2
---------------------------------------------------------------------
Balance Sheet Highlights
---------------------------------------------------------------------
Cash, equivalents, investments,
restricted cash $403.9 $384.0 $314.0
---------------------------------------------------------------------
Operating cash generated (used) $20.0 $11.4 $32.2
---------------------------------------------------------------------
Accounts receivable $163.0 $162.8 $152.3
---------------------------------------------------------------------
Days sales outstanding (DSO) 106 106 98
---------------------------------------------------------------------
Inventory turnover 2.3 2.3 2.2
---------------------------------------------------------------------
Fixed asset investment (during
quarter) $3.8 $2.4 $2.5
---------------------------------------------------------------------
Depreciation expense $4.4 $4.2 $4.2
---------------------------------------------------------------------
Working capital $474.3 $444.2 $373.0
---------------------------------------------------------------------
Headcount (permanent and
temporary) 1,779 1,770 1,787
---------------------------------------------------------------------
Contact:
FEI Company
Fletcher Chamberlin, Treasurer & Communications Director
(503) 726-7710
fletcher.chamberlin@fei.com
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