EXHIBIT 99.1
TERADYNE ANNOUNCES THIRD QUARTER RESULTS
BOSTON--(BUSINESS WIRE)--Oct. 16, 2001--Teradyne, Inc. (NYSE: TER) reported
sales of $249 million and a net loss, before special items, of $ 53.8 million ($
0.31 per share) for the Third Quarter of 2001. Special charges for the quarter
amounted to $49.6 million, after tax, or an additional loss of $0.28 per share.
This resulted in an overall net loss of $103 million, or $0.59 per share. Gross
bookings for the quarter were $212 million, with $82 million in cancellations
for Connection Systems and $16 million in cancellations for semiconductor test,
for a net order level of $114 million.
George Chamillard, Teradyne's chairman and chief executive officer, identified
some of the elements which made the quarter a particularly difficult one. "While
our loss before special charges of $0.31 per share was within the $0.22 to $0.32
guidance we gave early in the quarter, the decline in our order rate and
customer cancellations from our backlog were such that we could not reach the
$275 million to $325 million revenue range which we had anticipated in our
previous guidance." He went on to note that the special charges were due to
personnel reductions of some 1,000 employees and write-downs of inventory and
certain other assets in the company's connection systems and flash memory test
businesses.
Looking to the future, while he was able to identify some encouraging areas of
prospective customer demand, Chamillard observed there was no activity which
would indicate an upward trend. "It appears to us that we will be dealing with
low shipments and unfavorable financial results for the next several quarters.
In the fourth quarter, including the impact of the acquisition of GenRad, we
expect sales between $200 million and $250 million and to lose between $0.40 and
$0.50 per share, before any special charges."
Chamillard emphasized that going forward, Teradyne will devote substantial
attention to controlling expenses and managing its assets so as to assure its
continued strength. The company will also continue its focus on the development
of new products and having them designed into customer applications so as to be
well positioned to achieve success in the next upturn in business. Chamillard
noted that this applies not only to Teradyne's semiconductor test, broadband
test and connection systems businesses, but also to the circuit board inspection
and test market as Teradyne looks forward to combining its resources with those
of GenRad, Inc. following the October vote of GenRad stockholders on Teradyne's
proposed acquisition of GenRad. "While downturns are never easy or fun,"
Chamillard said, " Our employees are doing a great job of working with our
customers to make sure that we provide the most economic solutions to their
business problems and to make sure that Teradyne will emerge from this slowdown
as winners, not just survivors."
ABOUT TERADYNE
Teradyne (NYSE: TER - news) is the world's largest supplier of automatic test
equipment and is also a leading supplier of high performance interconnection
systems. Manufacturers of semiconductors, circuit assemblies, and voice and
broadband telephone networks use Teradyne's test products. Manufacturers of
communications and computing
systems central to building networking infrastructure use Teradyne's backplane
assemblies and high-density connectors. The company had sales of $3.0 billion in
2000 and currently employs about 8000 people worldwide. For more information
visit WWW.TERADYNE.COM.
SAFE HARBOR STATEMENT
Statements in this release, other than historical performance, include
forward-looking statements relating to future financial performance made under
the Safe Harbor provisions of the Private Securities Litigation Reform Act of
1995. Investors are cautioned that all forward-looking statements involve risks
and uncertainties that may cause actual results to differ materially from
expectations. In particular, our business is dependent on the current and
anticipated market demand for electronics, which has been impacted by the
economic slowdown that began in the latter portions of 2000 and by the terrorist
attacks of September 11, 2001. While in the past our diverse businesses have
allowed us to perform better than some companies in periods of economic decline,
there is no guarantee that this will be the case currently. In addition, the
markets that Teradyne serves have historically been quite cyclical, and they are
currently in a period of oversupply. Further, our backlog has and may continue
to be affected as customers continue to defer or cancel orders, which previously
had been accepted. Both of these factors could result in further decreased
revenues. Our business is also affected by our ability to develop and ship new
and sometimes more complex products to address changing customer needs, by new
offerings by competitors and by intense competition throughout the world in each
of our operating segments from competitors having substantial resources
available for the engineering, manufacturing, marketing and distribution of
their products. The economic decline and the resulting oversupply could increase
the possibility of intensified price competition in certain markets and result
in the need to lower our prices, which could result in decreased revenues. In
addition, our pending acquisition of GenRad, Inc. could affect our ability to
manage and maintain our business. Finally, our ongoing and recently announced
expense control measures may not have the intended effect on our future
financial results. These measures could have long-term effects on our business
by reducing our pool of technical talent, decreasing improvements in our
products and making it more difficult for us to respond to large customer orders
if the economy does not recover. Teradyne undertakes no obligation to update the
information contained in this release. For further information regarding risks
and uncertainties associated with Teradyne's business, please refer to
Teradyne's filings with the Securities and Exchange Commission, including, but
not limited to, Teradyne's annual report on Form 10-K and quarterly reports on
Form 10-Q. Any forward-looking statements should be considered in light of all
these factors.
TERADYNE, INC. REPORT FOR THIRD FISCAL QUARTER OF 2001
CONDENSED CONSOLIDATED OPERATING STATEMENTS
(In thousands, except per share amounts)
Quarter Ended: Nine Months Ended:
9/30/01 10/01/00 9/30/01 10/01/00
---------- ---------- ---------- ----------
Net Sales $ 249,355 $ 859,478 $1,220,367 $2,222,294
Cost of Sales 227,466 457,976 924,334 1,199,989
Cost of Sales -
Special Charges (1) 44,551 -- 44,551 --
Engineering and
Development 56,863 78,963 189,384 221,625
Selling and
Administrative (2)(3) 90,349 95,149 230,250 266,087
Other and Interest (2,353) (6,071) (23,594) (16,431)
Net Expenses 416,876 626,017 1,364,925 1,671,270
Income (Loss) Before
Cumulative Effect
of Change in
Accounting Principle
and Taxes (167,521) 233,461 (144,558) 551,024
Income (Loss) Before
Cumulative Effect
of Change in
Accounting Principle (103,404) 163,423 (89,626) 385,717
Cumulative effect on
prior years of the
application of SAB
101 "Revenue
Recognition in
Financial
Statements," net of
taxes -- -- -- (64,138)
Net (Loss) Income $ (103,404) $ 163,423 $ (89,626) $ 321,579
Earnings per common
share - diluted:
Income (Loss) Before
Cumulative Effect of
change in accounting
principle per common
share - diluted $ (0.59) $ 0.90 $ (0.51) $ 2.13
Cumulative effect on
prior years of the
application of SAB 101
"Revenue Recognition in
Financial Statements,"
per common share -
diluted $ -- $ -- $ -- $ (0.35)
Net (Loss) Income per
Common Share
- Diluted $ (0.59) $ 0.90 $ (0.51) $ 1.77
Shares used in
calculation of Net
(Loss) Income per
Common Share
- Diluted 175,689 181,937 174,673 181,502
Net Orders $ 113,462 $ 818,724 $ 680,709 $2,669,327
(1) - Included in Cost of Sales in the third quarter ended September 30, 2001
are inventory writedowns due to the discontinuance of the Flash memory product
line and certain impaired manufacturing assets. The special charges total $44.6
million pretax, or $0.16 per share.
(2) - Included in Selling and Administrative in the third quarter ended
September 30, 2001 are charges for certain impaired fixed assets of $13.9
million pretax, or $0.05 per share.
(3) - Included in Selling and Administrative in the third quarter ended
September 30, 2001 is a provision for workforce reduction and early retirement
of $20.6 million pretax, or $0.07 per share.
CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)
09/30/01 12/31/00
Assets
Cash, Cash Equivalents and
Marketable Securities $ 161,980 $ 302,575
Accounts Receivable 187,917 420,040
Inventories 413,348 512,563
Other Current Assets 171,934 142,656
935,179 1,377,834
Net Property, Plant and Equipment 826,825 733,786
Long-term Marketable Securities 158,276 161,848
Other Assets 85,449 82,400
$2,005,729 $2,355,868
Liabilities
Current Liabilities $ 294,743 $ 619,288
Long-term Liabilities 30,429 29,609
Shareholders' Equity $1,680,557 $1,706,971
$2,005,729 $2,355,868