EXHIBIT 99
GENUS REPORTS THIRD QUARTER 2004 RESULTS
SUNNYVALE, CALIF. - NOVEMBER 3, 2004 - Genus, Inc. (Nasdaq: GGNS) today reported
financial results for its third quarter and nine months ended September 30,
2004. Senior management will conduct an investor conference call to discuss
these results and the company's financial outlook in more detail today at 2 pm
pacific time, Wednesday, November 3, 2004. Access information is provided
below.
Net sales for the third quarter of 2004 were $10.0 million compared to $9.1
million for the same quarter of 2003 and $8.8 million in second quarter of 2004.
Net sales for the nine months ended September 30, 2004 were $30.9 million, down
from $41.5 million for the nine months ended September 30, 2003. The net loss
for the third quarter 2004 was $3.9 million or ($0.10) per diluted share
compared to net loss of $2.8 million or ($0.09) per share in the same quarter of
2003. Net loss in the third quarter of 2004 included $473,000 of expenses
related to the previously announced proposed merger with Aixtron. The net loss
for the nine months ended September 30, 2004 was $8.5 million or ($0.21) per
diluted share compared to a net loss of $3.8 million or ($0.13) per share for
the nine months ended September 30, 2003.
"Although year to date results have been disappointing from a P&L standpoint,
customer activity gained momentum toward the end of the quarter for both our
chemical vapor deposition (CVD) and atomic layer deposition (ALD) product
offerings," commented Bill Elder, Genus chairman and CEO. "We have already added
two new customers this year."
Gross margin as a percentage of revenues was 21 percent for the third quarter of
2004 compared to 23 percent for the same quarter of 2003. Gross margin as a
percentage of revenues was 29 percent, the same for both the nine months ended
September 30, 2004 and 2003. Research and development expenses were $2.1 million
in the third quarter of 2004, $400,000 higher than expenses of $1.7 million in
the third quarter of 2003, reflecting expenses related to additional temporary
headcount required to complete two important development programs on ALD
technology. Sales, general and administrative expenses (SG&A) were $3.1 million
in the third quarter of 2004, $300,000 higher than SG&A expenses of $2.8 million
in the third quarter of 2003, primarily reflecting increased expenses related to
customer demo programs of $120,000 in the third quarter of 2004 and the recovery
of $110,000 in bad debts in third quarter of 2003. In addition, in the third
quarter of 2004, Genus incurred merger related expenses of $473,000.
Operating expenses, including research and development, sales, general and
administrative expenses and merger related expenses were $16.3 million for the
nine months ended September 30, 2004, compared to
$14.6 million recorded for the nine months ended September 30, 2003. For the
nine months ended September 30, 2004, Genus incurred merger related expenses of
$1.3 million.
Genus ended the third quarter of 2004 with cash, cash equivalents and short-term
investments of $33.9 million, compared with a balance of $41.6 million on
December 31, 2003.
CONFERENCE CALL INFORMATION
Genus plans to host an investor conference call on Wednesday, November 3, 2004,
at 2 pm. pacific time, featuring remarks by Bill Elder, chairman and CEO, and
Shum Mukherjee, executive vice president finance and CFO, followed by a live
question and answer session. The conference call will be accessible by dialing
888-803-6692 or (706) 634-1030 and referencing call number 8959586. It will also
be broadcast live over the Internet at www.genus.com.
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ABOUT GENUS
Genus, Inc. manufactures critical deposition processing products for the global
semiconductor industry and the data storage industry. To enable the production
of intricate micro computer chips and electronic storage devices, Genus offers
its StrataGem and LYNX series production-proven equipment for 200mm and 300mm
semiconductor production, and offers thin film deposition products for chemical
vapor deposition (CVD), atomic layer deposition (ALD), and pre-clean
capabilities. Genus is at the forefront of market and technology developments in
the ALD marketplace, which is gaining acceptance worldwide as a critical
technology for sub 0.13-micron production of computer chips and electronic
storage devices. Genus' customers include semiconductor and data storage
manufacturers located throughout the United States, Europe and the Pacific Rim
including Korea, Japan and Taiwan. Founded in 1981, the company is headquartered
in Sunnyvale, California. For additional information visit Genus' web site at
www.genus.com. LYNX2(R) and LYNX3(TM) are trademarks of Genus, Inc.
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FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements regarding the company's
future financial and business performance. These forward-looking statements are
subject to a number of risks and uncertainties. These contingencies include but
are not limited to: actual customer orders received by the company, the extent
to which ALD technology is demanded by the marketplace, the actual number of
customer orders received by the company, the timing of final acceptance of
products by customers, the financial climate and accessibility to financing,
general conditions in the thin film equipment market and in the macro-economy,
and the influence of global political events. Genus assumes no obligation to
update this information. Additional risks and uncertainties are discussed in the
Management's Discussion and Analysis of Results of Operations contained in
Genus' Annual Report on Form 10-K for the fiscal year ended December 31, 2003
filed with the Securities and Exchange Commission.
COMPANY CONTACT:
Shum Mukherjee
Genus, Inc.
Tel: (408) 747-7120 Ext. 1311
Email: smukherjee@genus.com
- - TABLES TO FOLLOW -
GENUS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED NINE MONTHS ENDED
September 30, September 30,
2004 2003 2004 2003
-------- -------- ---------- --------
Net sales. . . . . . . . . . . . . . . . . . . $ 9,959 $ 9,107 $ 30,923 $41,541
Costs and expenses:
Cost of goods sold . . . . . . . . . . . 7,886 7,049 21,842 29,438
Research and development . . . . . . . . 2,060 1,663 5,732 5,758
Selling, general and administrative. . . 3,111 2,800 9,262 8,842
Expenses related to proposed merger. . . 473 - 1,294 -
-------- -------- ---------- --------
Loss from operations . . . . . . . . . . . . . (3,571) (2,405) (7,207) (2,497)
Interest expense . . . . . . . . . . . . . . . (437) (411) (1,285) (1,318)
Other income, net .. . . . . . . . . . . . . . 79 35 212 84
-------- -------- ---------- --------
Loss before income taxes . . . . . . . . . . . (3,929) (2,781) (8,280) (3,731)
Provision for (benefit from) income taxes . . . (25) 56 174 56
-------- -------- ---------- --------
Net loss . . . . . . . . . . . . . . . . . . . $(3,904) $(2,837) $ (8,454) $(3,787)
======== ======== ========== ========
Net loss per share - basic and diluted . . . . $ (0.10) $ (0.09) $ (0.21) $ (0.13)
Shares used in per share calculation
- basic and diluted 39,759 30,628 39,673 29,624
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GENUS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(IN THOUSANDS)
SEPTEMBER 30, DECEMBER 31,
2004 2003
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ASSETS
Current Assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . $ 20,904 $ 41,608
Short term investments. . . . . . . . . . . . . . . . . . . 13,015 -
Accounts receivable, net. . . . . . . . . . . . . . . . . . 6,857 9,606
Inventories . . . . . . . . . . . . . . . . . . . . . . . . 12,897 9,783
Other current assets. . . . . . . . . . . . . . . . . . . . 1,549 854
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Total current assets. . . . . . . . . . . . . . . . . 55,222 61,851
Equipment, furniture and fixtures, net. . . . . . . . . . . . . . 11,378 8,748
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . 681 1,169
---------- --------------
Total assets. . . . . . . . . . . . . . . . . . . . . $ 67,281 $ 71,768
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LIABILITIES
Current Liabilities:
Short-term bank borrowings. . . . . . . . . . . . . . . . . $ 7,500 $ 6,500
Accounts payable. . . . . . . . . . . . . . . . . . . . . . 5,774 4,956
Accrued expenses. . . . . . . . . . . . . . . . . . . . . . 3,521 4,130
Deferred revenue. . . . . . . . . . . . . . . . . . . . . . 433 331
Customer advances . . . . . . . . . . . . . . . . . . . . . 2,080 372
Notes payable . . . . . . . . . . . . . . . . . . . . . . . 47 249
7% convertible notes. . . . . . . . . . . . . . . . . . . . 6,368 -
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Total current liabilities. . . . . . . . . . . . . . 25,723 16,538
7% convertible notes. . . . . . . . . . . . . . . . . . . . . . . - 5,806
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Total liabilities . . . . . . . . . . . . . . . . . . 25,723 22,344
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SHAREHOLDERS' EQUITY
Common stock, no par value:
Authorized 100,000 shares;
Issued and outstanding 39,759 shares at September 30, 2004
and 39,554 shares at December 31, 2003 . . . . . . . . 163,408 163,061
Accumulated deficit . . . . . . . . . . . . . . . . . . . . (119,782) (111,328)
Note receivable from shareholder. . . . . . . . . . . . . . - (187)
Accumulated other comprehensive loss. . . . . . . . . . . . (2,068) (2,122)
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Total shareholders' equity. . . . . . . . . . . . . . 41,558 49,424
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Total liabilities and shareholders' equity $ 67,281 $ 71,768
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