EXHIBIT 99.1
[LOGO OF SPEEDFAM INTERNATIONAL, INC.]
SPEEDFAM INTERNATIONAL, INC.
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7406 West Detroit
Chandler, Arizona 85226
Phone: (602) 961-2175
Fax (602) 961-2171
For more information, contact:
Roger K. Marach, Chief Financial Officer
(602) 961-2175
FOR IMMEDIATE RELEASE
SpeedFam International Reports Fourth-Quarter 1996 Results:
$0.46 Earnings Per Share on $43.8 Million Revenue
Full-Year 1996: $1.16 EPS on $120.2 Million Revenue
CHANDLER, Ariz., July 8, 1996 -- SpeedFam International, Inc.
(NASDAQ:SFAM), a supplier of high-throughput chemical mechanical polishing (CMP)
systems for the semiconductor and disk media industries worldwide, today
announced its operating results for the fourth quarter of fiscal 1996 and the
full year.
For the fourth quarter ended May 31, 1996, SpeedFam reported total revenue
of $45.8 million, more than double the $19.7 million reported for the fourth
quarter of 1995. Backlog at quarter's end was the highest in the company's
history at $72.8 million, up from $67.8 million at the end of the third quarter
and from $46.6 million a year earlier.
Net earnings for the fourth quarter of 1996 were $5.1 million, or 11.7
percent of total revenue, up from $1.5 million, or 7.7 percent of total revenue,
for the fourth quarter of 1995. Net earnings per share were $0.46, compared with
$0.19 for the year-earlier period. The 1996 figure includes the effect of a 24.7
- -percent increase in common and common equivalent shares outstanding, resulting
primarily from the company's initial public offering of common stock in October
1995. Also, on June 13, 1996, SpeedFam announced the filing of a registration
statement with the Securities and Exchange Commission (SEC) to offer an
additional 2,660,000 shares of common stock, of which 2,000,000 shares are being
sold by the company.
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For the full year ended May 31, 1996, SpeedFam reported total revenue of
$120.2 million, more than double the $59.8 million reported for 1995. Net
earnings for 1996 were $11.8 million, or $1.16 per share, compared with $1.6
million, or $0.20 per share, for 1995.
For the fourth quarter of 1996, SpeedFam's equity in the net earnings of
its joint ventures--SpeedFam Co., Ltd. and Fujimi Corporation--was $1.6 million,
up from $206,000 for the year-earlier period. For the full year, the company's
equity in the net earnings of its joint ventures was $5.2 million, up from $1.2
million for 1995.
Shifts in Product and Business Mix
For the fourth quarter of 1996, the equipment, parts and expendables
segment of SpeedFam's business generated revenue of $34.9 million, or 84.0
percent of net sales, up from $10.0 million, or 55.4 percent of net sales, a
year earlier. Sales of slurries (polishing liquids and abrasives) accounted for
$6.7 million, or 16.0 percent of net sales, down from $8.0 million, or 44.6
percent, in the fourth quarter of 1995.
For 1996, equipment, parts and expendables revenue grew to $88.0 million,
or 77.3 percent of net sales, from $29.8 million, or 52.3 percent of net sales,
for 1995. For 1996, slurries sales decreased to $25.8 million, or 22.7 percent
of net sales, from $27.2 million, or 47.7 percent of net sales, for 1995.
"Year-over-year revenue growth reflects increasing demand for SpeedFam
equipment and technology in our core markets, as well as a continuing shift in
our business mix to the emerging market for CMP of advanced semiconductor
devices," said Makoto Kouzuma, president and chief operating officer of SpeedFam
International. "While maintaining our presence as a major equipment supplier to
the thin film memory disk media and silicon wafer markets, we are also emerging
as an important supplier to semiconductor device manufacturers, with our CMP-V
planarization system."
For the fourth quarter of 1996, sales of CMP-V systems contributed $17.5
million, or 40.1 percent of total revenue, compared with $1.6 million, or 8.1
percent, a year ago. Sales to the thin film memory disk media market accounted
for $15.7 million, or 35.8 percent of total revenue, compared with $9.3 million,
or 47.0 percent, for the fourth quarter of 1995.
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For 1996, SpeedFam's CMP-V system sales to the semiconductor device market
grew to $39.5 million, or 32.9 percent of total revenue, from $4.5 million, or
7.5 percent, for 1995. For the same period, the company's sales to the thin
film memory disk media market increased to $49.5 million, or 41.2 percent of
total revenue, from $32.3 million, or 54.1 percent, for 1995.
For the fourth quarter of 1996, commission revenue on the sale of equipment
produced by the company's Far East joint venture, SpeedFam Co., Ltd., to the
silicon wafer markets in the U.S. and Europe totaled $2.2 million, compared with
$1.7 million for the fourth quarter of 1995. Commission revenue for 1996 was
$6.3 million, compared with $2.8 million for 1995.
Gross Margin, Operating Expenses
Gross margin for the fourth quarter of 1996 improved to 37.9 percent from
28.1 percent a year earlier. This improvement was due principally to a
continued shift in product mix from lower-margin slurries to higher-margin
equipment, parts and expendables--particularly CMP-V systems--combined with
improved manufacturing efficiencies. For the full year, gross margin increased
to 34.5 percent, from 23.9 percent for 1995.
For the fourth quarter of 1996, research, development and engineering
expenses increased to $4.5 million, or 10.3 percent of total revenue, from
$749,000, or 3.8 percent, a year ago. For the full year, research, development
and engineering expenses were $11.5 million, or 9.6 percent of total revenue,
compared with $2.7 million, or 4.6 percent, for 1995. These increases reflect
the company's commitment of significant resources to the continued development
of CMP process and related technologies throughout fiscal year 1996.
For the fourth quarter of 1996, selling, general and administrative
expenses were $6.3 million, or 14.4 percent of total revenue, compared with $2.5
million, or 12.9 percent for the year-earlier period. Full-year expenses were
$18.9 million, or 15.7 percent of total revenue, compared with $9.9 million, or
16.6 percent, for 1995. These increases, which supported SpeedFam's revenue
growth, reflected the addition of administrative and sales personnel, the
opening of new service and sales locations, and the payment of commissions to
the company's Japanese affiliate on export sales from the U.S. to the Far East
region.
Due to strong revenue growth and gross margin improvements, operating
profit for the fourth quarter of 1996 was $5.8 million, or 13.1 percent of total
revenue, up from $2.2 million, or
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11.4 percent, for the fourth quarter of 1995. Full-year operating profit was
$11.1 million, or 9.2 percent of total revenue, up from $1.6 million, or 2.7
percent, for 1995.
The Company
SpeedFam International, Inc. designs, develops, manufactures, markets and
services high-throughput precision surface processing systems used in the
fabrication of thin film memory disk media, semiconductor wafers, general
industrial components and, more recently, semiconductor devices through chemical
mechanical polishing (CMP). In addition, the company markets and distributes
slurries, parts and expendables used in its customers' manufacturing processes.
SpeedFam International, Inc. owns a 50-percent interest in each of two joint
ventures, SpeedFam Co., Ltd. and Fujimi Corporation.
Certain statements in this news release constitute 'forward-looking
statements' within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance
or achievements of the company to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. The aforementioned risks, uncertainties and other
factors are detailed in the company's filings with the SEC, especially Forms
10-Q and 10-K as they are filed, and Form S-1 filed on June 13, 1996.
(financial statements attached)
# # #
SPEEDFAM INTERNATIONAL, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(dollars and shares in thousands, except per share data)
Three Months Ended Year Ended
May 31, May 31, May 31, May 31,
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1996 1995 1996 1995
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Revenue:
Net sales $41,539 $18,025 $113,880 $57,021
Commissions from affiliate 2,237 1,714 6,289 2,757
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Total revenue 43,776 19,739 120,169 59,778
Cost of sales 27,180 14,197 78,661 45,494
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Gross margin 16,596 5,542 41,508 14,284
Research, development and engineering 4,502 749 11,496 2,740
Selling, general and administrative 6,305 2,544 18,921 9,948
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Operating profit 5,789 2,249 11,091 1,596
Interest expense (76) (190) (691) (958)
Other income (expense), net 43 (67) 484 6
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Earnings from consolidated companies before income taxes 5,756 1,992 10,884 643
Income tax expense 2,264 870 4,266 186
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Earnings from consolidated companies 3,492 1,322 6,618 457
Equity in net earnings of affiliates 1,641 206 5,203 1,187
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Net earnings $ 5,133 $ 1,528 $ 11,821 $ 1,644
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Net earnings per share $ 0.46 $ 0.19 $ 1.16 $ 0.20
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Weighted average common and common equivalent shares 11,258 8,138 10,159 8,148
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SPEEDFAM INTERNATIONAL, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
May 31, May 31,
1996 1995
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ASSETS
Current assets:
Cash and cash equivalents $ 10,871 $ 1,095
Trade accounts and notes receivable, net 34,693 16,971
Inventories 27,931 17,995
Other current assets 2,470 1,214
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Total current assets 76,965 37,275
Investments in affiliates 20,450 18,582
Property, plant and equipment, net 9,969 3,061
Other assets 1,500 1,111
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Total assets $107,984 $60,029
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings and current portion of
long-term debt $ 727 $ 908
Accounts payable 26,460 16,045
Customer deposits 4,814 5,662
Other current liabilities 12,771 3,588
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Total current liabilities 44,772 26,203
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Long-term debt 2,593 10,362
Deferred income taxes 580 427
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Total liabilities 47,945 36,992
Shareholders' equity 60,039 23,037
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Total liabilities and shareholders' equity $107,984 $60,029
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