EXHIBIT 99.1
PRESS RELEASE
FOR IMMEDIATE RELEASE
CONTACT:
William S. Johnson
Vice President and Chief Financial Officer
Cabot Microelectronics Corporation
(630) 375-5591
CABOT MICROELECTRONICS REPORTS
RESULTS FOR THIRD FISCAL QUARTER 2004
AND ANNOUNCES SHARE REPURCHASE PROGRAM
AURORA, IL, July 22, 2004 - Cabot Microelectronics Corporation (Nasdaq: CCMP),
the leading supplier of chemical mechanical planarization (CMP) polishing
slurries to the semiconductor industry, today reported financial results for its
third fiscal quarter, which ended June 30, 2004. The company also announced that
its Board of Directors has authorized a share repurchase program for up to $25
million of the company's outstanding common stock.
Total revenue for the third fiscal quarter of 2004 was $76.9 million, up 4.6%
from $73.5 million in the prior quarter and up 19.7% from $64.3 million in the
third quarter a year ago. Slurries used for copper, tungsten, and oxide
polishing applications all experienced sequential revenue increases this
quarter. Average selling price also rose sequentially by 2.0%, due to a higher
valued product mix than in the prior quarter, partially offset by selected price
reductions.
Gross profit for the quarter was $39.0 million, up by 7.9% from the prior
quarter's $36.1 million, and up 18.5% from $32.9 million in the year ago
quarter. As a percentage of revenue, gross profit increased to 50.7% this
quarter from 49.2% last quarter, primarily due to the benefits of higher
manufacturing capacity utilization and a more favorable product mix versus the
previous quarter, partially offset by selected price reductions. Gross profit in
the same quarter of last year represented 51.2% of revenue.
Operating expenses of $21.1 million, consisting of research and development,
selling and marketing, and general and administrative expenses, decreased by
$0.2 million sequentially, and were $2.8 million higher than the same quarter
last year.
Net income for the quarter was $12.2 million, up by 26.0% from $9.7 million last
quarter, and up 25.4% from $9.8 million in the same quarter last year. Diluted
earnings per share were $0.49 this quarter, compared to $0.39 in the previous
quarter and $0.40 in the year ago quarter.
In addition, with respect to the $25 million share repurchase program, share
repurchases will be funded from the company's cash balance, which as of June 30,
2004 was $155.9 million, and are primarily intended to diminish dilution
-MORE-
CABOT MICROELECTRONICS REPORTS RESULTS FOR
THIRD FISCAL QUARTER 2004............................................PAGE 2 of 5
from stock option and employee stock purchase plans. Share repurchases under the
program may be made at management's discretion from time to time, depending on
market conditions, in open market transactions. The program, which is effective
immediately, may be suspended or terminated at the company's discretion. At
present, the company has approximately 24.8 million shares of common stock
outstanding and an aggregate market capitalization of approximately $680
million.
"We are proud of our strong financial performance this quarter, including our
achievement of a record level of quarterly revenue," stated William P. Noglows,
Chairman and CEO. "Our company has recently realized progress on a number of
important initiatives that we believe will contribute toward our long term
success. First, in support of our strategy to enlarge and strengthen our already
substantial presence in the Asia Pacific region, we purchased additional land
adjoining our existing facilities in Japan to expand our current infrastructure
there. Second, as part of our strategy of continued technology leadership, we
entered into a strategic alliance with NanoProducts Corporation, a technology
leader in the field of nanoscale particles, and also obtained a minority equity
position in the company, which we believe will allow us to leverage innovative
next generation abrasives for our CMP slurries and other fine finish polishing
applications. Finally, we believe the implementation of our share repurchase
program represents a prudent use of a portion of our growing cash balance. We
are excited about the progress we have made, as demonstrated by these important
initiatives, and we believe we are well positioned for continued leadership in
this competitive arena."
CONFERENCE CALL
Cabot Microelectronics' quarterly earnings conference call will be held today at
9:00 a.m. Central Time. The live conference call will be available to all
interested parties via webcast from the company's website, www.cabotcmp.com, or
by phone at (800) 893-3008. Callers outside the U.S. can dial (706) 634-5531.
For those who cannot listen to the live broadcast, a replay will be available
through August 19, 2004, by calling (800) 642-1687 or (706) 645-9291, and using
access code 5676078, or via webcast at www.cabotcmp.com. A transcript of the
formal comments made during the conference call will be available in the
Investor Relations section of the company's website.
ABOUT CABOT MICROELECTRONICS
Cabot Microelectronics Corporation, headquartered in Aurora, Illinois, is the
leading supplier of CMP slurries for polishing various materials used in
semiconductor manufacturing processes. The company's products play a critical
role in the production of the most advanced semiconductor devices, enabling the
manufacture of smaller, faster and more complex devices by its customers. For
more information about Cabot Microelectronics Corporation, visit
www.cabotcmp.com or contact Mr. David H. Li, Director of Investor Relations at
(630) 499-2600.
SAFE HARBOR STATEMENT
This news release may include statements that constitute "forward-looking
statements" within the meaning of federal securities regulations. These
forward-looking statements include statements related to future sales and
operating results, company and industry growth and trends, growth of this
market, international events, product performance, new product introductions and
development of new products and technologies by Cabot Microelectronics. These
forward-looking statements involve a number of risks, uncertainties, and other
factors, including those described from time to time in Cabot Microelectronics'
filings with the Securities and Exchange Commission (SEC), that could cause
actual
-MORE-
CABOT MICROELECTRONICS REPORTS RESULTS FOR
THIRD FISCAL QUARTER 2004............................................PAGE 3 of 5
results to differ materially from those described by these forward-looking
statements. In particular, see "Risks Relating to Our Business" in Management's
Discussion and Analysis in our quarterly report on Form 10-Q for the quarter
ended March 31, 2004, and our Annual Report on Form 10-K for the fiscal year
ended September 30, 2003, both filed with the SEC. Cabot Microelectronics
Corporation assumes no obligation to update this forward-looking information.
-TABLES TO FOLLOW-
CABOT MICROELECTRONICS CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited and amounts in thousands, except per share amounts)
Quarter Ended Nine Months Ended
----------------------------------------- -------------------------------
June 30, March 31, June 30, June 30, June 30,
2004 2004 2003 2004 2003
----------------------------------------- -------------------------------
Revenue $ 76,925 $ 73,515 $ 64,288 $226,719 $183,762
Cost of goods sold 37,915 37,366 31,360 114,307 90,811
-------- -------- -------- -------- --------
Gross profit 39,010 36,149 32,928 112,412 92,951
Operating expenses:
Research and development 11,158 11,143 10,803 33,024 29,047
Selling and marketing 4,235 4,363 2,751 12,381 7,883
General and administrative 5,659 5,749 4,655 16,532 13,618
Amortization of intangibles 85 85 85 255 255
-------- -------- -------- -------- --------
Total operating expenses 21,137 21,340 18,294 62,192 50,803
-------- -------- -------- -------- --------
Operating income 17,873 14,809 14,634 50,220 42,148
Other income (expense), net 72 (86) 46 22 84
-------- -------- -------- -------- --------
Income before income taxes 17,945 14,723 14,680 50,242 42,232
Provision for income taxes 5,699 5,006 4,918 16,681 14,148
-------- -------- -------- -------- --------
Net income $ 12,246 $ 9,717 $ 9,762 $ 33,561 $ 28,084
======== ======== ======== ======== ========
Basic earnings per share $ 0.49 $ 0.39 $ 0.40 $ 1.35 $ 1.15
======== ======== ======== ======== ========
Weighted average basic shares outstanding 24,818 24,785 24,389 24,775 24,341
======== ======== ======== ======== ========
Diluted earnings per share $ 0.49 $ 0.39 $ 0.40 $ 1.35 $ 1.14
======== ======== ======== ======== ========
Weighted average diluted shares outstanding 24,912 24,926 24,639 24,919 24,600
======== ======== ======== ======== ========
CABOT MICROELECTRONICS CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited and amounts in thousands)
June 30, September 30,
2004 2003
-------- -------------
ASSETS:
Current assets:
Cash and cash equivalents $155,885 $111,318
Accounts receivable, net 37,952 37,564
Inventories, net 24,565 23,814
Other current assets 7,286 6,416
-------- --------
Total current assets 225,688 179,112
Property, plant and equipment, net 126,900 133,695
Other long-term assets 2,368 2,810
-------- --------
Total assets $354,956 $315,617
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable $ 13,363 $ 12,521
Capital lease obligations 1,434 1,716
Accrued expenses, income taxes payable and other current liabilities 13,597 14,679
-------- --------
Total current liabilities 28,394 28,916
Capital lease obligations 6,612 7,452
Deferred income taxes and other long-term liabilities 9,523 7,476
-------- --------
Total liabilities 44,529 43,844
Stockholders' equity 310,427 271,773
-------- --------
Total liabilities and stockholders' equity $354,956 $315,617
======== ========