(MKS LOGO) EXHIBIT 99.1
FOR IMMEDIATE RELEASE
Contact: Ron Weigner
Vice President and Chief Financial Officer
978.284.4446
MKS INSTRUMENTS REPORTS FIRST QUARTER 2005 RESULTS
Wilmington, Mass. -- April 26, 2005 -- MKS Instruments, Inc. (NASDAQ:
MKSI), a leading worldwide provider of process control technologies for
improving productivity in semiconductor and other advanced manufacturing
processes, today reported first quarter 2005 financial results that exceeded
revenue and earnings guidance given on February 10, 2005. Net sales were $127.4
million, down 4.2 percent from $133.0 million in the first quarter of 2004 and
down 2.6 percent from $130.9 million in the fourth quarter of 2004.
GAAP net earnings were $5.5 million, or $0.10 per diluted share, compared
to $12.7 million, or $0.23 per diluted share, in the first quarter of 2004.
Fourth quarter 2004 GAAP net earnings of $24.1 million, or $0.44 per diluted
share, included a non-cash adjustment to reverse a previously established
valuation allowance against net deferred tax assets. Excluding this adjustment,
fourth quarter 2004 net earnings were $7.4 million, or $0.14 per diluted share.
Non-GAAP earnings, which exclude amortization of acquired intangible assets
and special items, were $8.0 million, or $0.15 per diluted share, compared to
$16.8 million, or $0.31 per diluted share in the first quarter of 2004, and
$11.1 million, or $0.20 per diluted share, in the fourth quarter of 2004.
"Our sales and earnings exceeded our guidance, and gross margin improved in
the first quarter," said John Bertucci, Chairman and Chief Executive Officer.
"We continued to develop products that enhance the performance and productivity
of process tools, and to work with semiconductor customers on next generation
opportunities. We continued to have success at the leading edge, where
utilization rates are higher. We are participating in many customer evaluations
of our products, including subsystems that integrate multiple technologies, and
I am pleased with our success.
"Looking ahead, based on current customer order patterns, second quarter
2005 sales could remain essentially flat and range from $124 to $129 million.
GAAP net earnings could range from $0.10 to $0.13 per diluted share, and
non-GAAP earnings could range from $0.14 to $0.17 per diluted share. Our
visibility is limited because of our short lead times, making it difficult to
estimate business levels beyond the current quarter. However, we tend to reflect
broad industry trends, because we provide a range of solutions to semiconductor
OEMs and fabs, and our process monitoring and control products are on most
front-end processes. Based on some recently published industry spending
forecasts and surveys, we are cautiously optimistic about the outlook for the
balance of this year."
The financial results that exclude certain charges and special items are
not in accordance with Accounting Principles Generally Accepted in the United
States of America (GAAP). MKS has historically been acquisitive, and MKS'
management believes the presentation of non-GAAP financial measures, which
exclude the costs associated with acquisitions and other special items, is
useful to investors for comparing prior periods and analyzing ongoing business
trends and operating results.
Management will discuss first quarter financial results on a conference
call today at 5:00 p.m. (Eastern Daylight Time). A live web cast and replay of
the conference call will be available at www.mksinstruments.com in the
"Investors" section. To hear a telephone replay through May 3, 2005, dial
303-590-3000, pass code 11027307#.
MKS Instruments, Inc. is a leading worldwide provider of process control
solutions for advanced manufacturing processes such as semiconductor device
manufacturing; thin-film manufacturing for flat panel displays, data storage
media, architectural glass and electro-optical products; and technology for
medical imaging equipment. Our instruments, components and subsystems
incorporate sophisticated technologies to power, measure, control, and monitor
increasingly complex gas-related semiconductor manufacturing processes, thereby
enhancing our customers' uptime, yield and throughput, and improving their
productivity and return on invested capital.
This release contains projections or other forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995
regarding MKS' future growth and the future financial performance of MKS. These
projections or statements
are only predictions. Actual events or results may differ materially from those
in the projections or other forward-looking statements set forth herein. Among
the important factors that could cause actual events to differ materially from
those in the projections or other forward-looking statements are the
fluctuations in capital spending in the semiconductor industry, fluctuations in
net sales to MKS' major customers, potential fluctuations in quarterly results,
the challenges, risks and costs involved with integrating the operations of MKS
and any acquired companies, dependence on new product development, rapid
technological and market change, acquisition strategy, manufacturing and
sourcing risks, volatility of stock price, international operations, financial
risk management, and future growth subject to risks. Readers are referred to
MKS' filings with the Securities and Exchange Commission, including its most
recent Annual Report on Form 10-K, for a discussion of these and other important
risk factors concerning MKS and its operations. MKS is under no obligation to,
and expressly disclaims any obligation to, update or alter its forward-looking
statements, whether as a result of new information, future events or otherwise.
###
MKS INSTRUMENTS, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended
------------------------------------------
March 31, March 31, December 31,
2005 2004 2004
--------- --------- ------------
Net sales $ 127,407 $ 132,985 $ 130,859
Cost of sales 78,045 78,756 82,716
--------- --------- ---------
Gross profit 49,362 54,229 48,143
Research and development 14,549 14,336 13,816
Selling, general and administrative 23,849 20,152 21,500
Amortization of acquired intangible assets 3,690 3,693 3,691
Restructuring charges 454 437 --
--------- --------- ---------
Income from operations 6,820 15,611 9,136
Interest income, net 1,098 272 873
--------- --------- ---------
Income before income taxes 7,918 15,883 10,009
Provision (benefit) for income taxes 2,460 3,177 (14,106)
--------- --------- ---------
Net income $ 5,458 $ 12,706 $ 24,115
========= ========= =========
Net income per share:
Basic $ 0.10 $ 0.24 $ 0.45
Diluted $ 0.10 $ 0.23 $ 0.44
Weighted average shares outstanding:
Basic 53,878 53,255 53,680
Diluted 54,393 55,085 54,272
THE FOLLOWING SUPPLEMENTAL NON-GAAP
EARNINGS INFORMATION IS PRESENTED TO AID IN
UNDERSTANDING MKS'S OPERATING RESULTS:
GAAP net income $ 5,458 $ 12,706 $ 24,115
Adjustments (net of tax):
Amortization of acquired intangible assets 2,306 3,693 3,691
Restructuring charges 272 437 --
Benefit for income taxes (NOTE 1) -- -- (16,729)
--------- --------- ---------
Non-GAAP net income (NOTE 2) $ 8,036 $ 16,836 $ 11,077
========= ========= =========
Non-GAAP net income per share (NOTE 2) $ 0.15 $ 0.31 $ 0.20
Weighted average shares outstanding - diluted 54,393 55,085 54,272
NOTE 1: The three month period ended December 31, 2004 includes a benefit of
$16,729 for the reversal of the previously established valuation allowance
against net deferred tax assets.
NOTE 2: The Non-GAAP net income and non-GAAP net income per share amounts
exclude amortization of acquired intangible assets, acquisition and disposition
related charges and special items, net of applicable income taxes.
MKS INSTRUMENTS, INC.
UNAUDITED CONSOLIDATED BALANCE SHEET
(IN THOUSANDS)
March 31, December 31,
2005 2004
---- ----
ASSETS
Cash and short-term investments $244,917 $235,900
Trade accounts receivable 82,770 82,315
Inventories 97,663 99,633
Other current assets 21,986 22,037
-------- --------
Total current assets 447,336 439,885
Property, plant and equipment, net 80,197 80,917
Long-term investments 2,597 4,775
Goodwill 256,114 255,740
Other acquired intangible assets 37,806 41,604
Other assets 5,382 5,756
-------- --------
Total assets $829,432 $828,677
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LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term debt $ 21,802 $ 24,509
Accounts payable 26,283 23,338
Accrued expenses and other liabilities 39,180 44,338
-------- --------
Total current liabilities 87,265 92,185
Long-term debt 6,690 6,667
Other long-term liabilities 3,621 3,191
Stockholders' equity:
Common stock 113 113
Additional paid-in capital 632,808 631,760
Retained earnings 87,535 82,077
Other stockholders' equity 11,400 12,684
-------- --------
Total stockholders' equity 731,856 726,634
-------- --------
Total liabilities and stockholders' equity $829,432 $828,677
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