Exhibit 99
FOR FURTHER INFORMATION:
At The Company
Michael W. McCarthy
VP, Investor Relations & Corporate
Communications
(203)775-9000
mmccarthy@brk.photronics.com
FOR IMMEDIATE RELEASE
April 30, 2001
Photronics Enhances Manufacturing Efficiencies & Capacity Utilization
Final Steps of Align-Rite International Integration Will Further Streamline
Operations, Increase Productivity and Accelerate Technology Development
JUPITER, Florida April 30, 2001 -- Photronics, Inc. (Nasdaq:PLAB), the
world's leading sub-wavelength reticle solutions supplier, today announced a
realignment of its global photomask manufacturing network by consolidating
facilities in California, Florida and Germany. The Company is initiating this
action as the final phase of its June 2000 merger with Align-Rite International,
to reposition its manufacturing capability and capacity to better address the
advancing technology requirements of the semiconductor industry. The plan
focuses on increasing Photronics' capacity utilization, leveraging the Company's
substantial manufacturing efficiencies and allocating additional resources to
accelerate the expansion of its worldclass technology development. In addition
to the facilities consolidation, the Company also announced that it would be
relocating its 14 year old Northern California operations to a new, state-of-
the-art reticle manufacturing facility in the Silicon Valley region.
Photronics will record an after tax charge of between $23 million and $26
million, or $0.67 to $0.75 per diluted share, in the fiscal second quarter
ending April 30, 2001, in connection with the consolidation plan and the
disposition of certain mature photomask manufacturing equipment, of which more
than 75% will be non-cash. Additionally, the Company expects to reduce its
worldwide workforce by approximately 8% to 10% in connection with the
elimination of the three manufacturing sites. As implemented, the Company's
consolidation plans call for a recovery of all related charges in less than two
years through increased manufacturing efficiencies and lower operating costs.
Constantine S. Macricostas, Chairman & Chief Executive Officer, stated,
"The future of the photomask industry is very bright. Advances in technology
continue to open up new applications for high performance, increasingly more
functional semiconductors, and thus increase the demand for our technology and
services as the semiconductor industry transitions to technologies at and below
0.13 micron. At the same time, the dynamics of serving maturing technologies has
grown more complex as 0.25 micron technologies have begun to mature. Photronics'
cost structure, already the most efficient in the industry today, is poised to
gain additional momentum as a result of this consolidation plan."
James L. Mac Donald, President, added, "Competing in the technology driven
global economy requires that Photronics continually examine the optimum
infrastructure to deliver our technology and service in a manner that further
differentiates our Company from our competitors. When Photronics and Align-
Rite agreed
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PHOTRONICS ENHANCES MANUFACTURING EFFICIENCIES..........................PAGE TWO
to merge, we identified opportunities to leverage our combined infrastructure,
bringing even greater economies of scale to the merged global manufacturing
network, our technology development team, and our customer service organization.
Facilities consolidation, including the establishment of a new state-of-the-art
manufacturing center in the Silicon Valley region, is consistent with
Photronics' vision as a photomask industry leader, which positions the Company
to meet the expectations of our customers, our employees, and our shareholders."
Mr. Mac Donald emphasized the Company's unwavering commitment to its successful
Sub-Wavelength Reticle Solutions technology development and capital investment
programs and their strategic relationship to achieving the Company's goals.
"Advanced processes and manufacturing technology are the means by which the
Company will broaden its competitive position, enabling it to successfully
address new applications for our technology and service, and increase our market
share in Asia, Europe, and North America."
Facilities in Palm Bay, Florida and Heilbronn, Germany will be ramped down
and their operations consolidated principally with the Photronics' facilities in
Brookfield, Connecticut and Bridgend, Wales, respectively. This process, in
cooperation with the Company's customers, has been accelerated and is expected
to be completed over the next several quarters.
In California, Photronics will consolidate its Burbank, California
operation into its new Phoenix, Arizona facility. Additionally, the Company will
be relocating its Milpitas, California operation into a new facility. It will be
Silicon Valley's first new photomask manufacturing operation brought into
service in more than 15 years and will be modeled after the advanced facilities
the Company has put into service all around the world. It will contain a Class 1
clean room infrastructure and utilize the Company's proprietary Sub-Wavelength
Reticle Solutions processes capable of servicing the semiconductor industry's
most demanding requirements for the 0.13 micron and below technology nodes.
Several potential locations have been identified and a final decision is
expected to be announced this summer.
Mr. Mac Donald commented, "We are aligning our capabilities with the
advancing technology and capacity demands of the global semiconductor community
that we serve. We are especially excited, as are our valued West Coast based
customers, to bring a new Silicon Valley facility into operation as
semiconductor manufacturers ramp their 0.13 micron technology requirements. When
combined with our modern facilities in Arizona and Texas, Photronics will stand
alone in having built the infrastructure required to support our customers well
beyond the 0.10 micron technology node."
Currently, the operations in Burbank, California; Palm Bay, Florida; and
Heilbronn, Germany employ approximately 200 people, each of whom will be given
the opportunity to apply for open positions throughout the Photronics
organization. The Company expects to retain a good number of these valued
employees in order to address the increased utilization levels as a result of
transitioning customers into the remaining facilities. "The quality of our
photomask manufacturing personnel is the cornerstone of our continued success,"
noted Mr. Mac Donald, "and Photronics has the deepest pool of talented
professionals in our industry. We are committed to
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PHOTRONICS ENHANCES MANUFACTURING EFFICIENCIES........................PAGE THREE
retaining those employees interested in relocating to advance their careers with
our Company." In addition to relocation opportunities, Photronics has
implemented an attractive employee retention program to insure that the
consolidation process proceeds smoothly and is transparent to the customer. The
Company has also agreed to provide assistance to personnel in finding employment
in the regions affected by the consolidation plan.
The Company will announce fiscal 2001 second quarter results after the
market closes on Wednesday, May 9, 2001. It will address those results, as well
as the elements of its consolidation program during its regular earnings
conference call scheduled for 8:30 a.m. EDT, on Thursday, May 10, 2001 with the
investment community and the media. The call can be accessed by logging onto
Photronics' web site at www.photronics.com and navigating to the Investor
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Relations page. The call will be archived for instant replay access until the
Company reports fiscal 2001 third quarter results in August 2001.
# # #
Photronics is a leading worldwide manufacturer of photomasks. Photomasks are
high precision quartz plates that contain microscopic images of electronic
circuits. A key element in the manufacture of semiconductors, photomasks are
used to transfer circuit patterns onto semiconductor wafers during the
fabrication of integrated circuits. They are produced in accordance with circuit
designs provided by customers at strategically located manufacturing facilities
in Asia, Europe, and North America. Additional information on the Company can be
accessed at www.photronics.com.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995: Except for historical information, the matters discussed in this news
release that may be considered forward-looking statements may be subject to
certain risks and uncertainties that could cause the actual results to differ
materially from those projected. Such risks and uncertainties include the
inability of the Company to achieve the capacity utilization, manufacturing and
technology efficiencies in the amounts and during the time frame contemplated by
the second quarter 2001 consolidation plan, and other risks and uncertainties
described in the Company' Annual Report on Form 10-K for the year ended October
31, 2000 under the caption "Forward Looking Information" and other SEC reports
filed by the Company. The Company assumes no obligation to update the
information in this release.
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