UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
or
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended November 24, 2001 Commission File Number 000-30789
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ENTEGRIS, INC.
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(Exact name of registrant as specified in charter)
Minnesota 41-1941551
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(State or other jurisdiction of incorporation) (IRS Employer ID No.)
3500 Lyman Boulevard, Chaska, Minnesota 55318
---------------------------------------------
(Address of Principal Executive Offices)
Registrant's Telephone Number (952) 556-3131
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Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES X NO
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the close of the latest practicable date.
Class Outstanding at December 31, 2001
- ----------------------------- -------------------------------------
Common Stock, $0.01 Par Value 69,898,307
ENTEGRIS, INC., INC. AND SUBSIDIARIES
FORM 10-Q
TABLE OF CONTENTS
FOR THE QUARTER ENDED NOVEMBER 24, 2001
Description Page
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PART I
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Item 1. Unaudited Consolidated Financial Statements
Consolidated Balance Sheets as of November 24, 2001
and August 25, 2001 3
Consolidated Statements of Operations for the Three Months
Ended November 24, 2001 and November 25, 2000 4
Consolidated Statements of Cash Flows for the Three Months
Ended November 24, 2001 and November 25, 2000 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
Item 3. Quantitative and Qualitative Disclosures About Market Risk 12
PART II Other Information
Item 6. Exhibits 13
2
Item 1. Financial Statements
- ----------------------------
ENTEGRIS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
November 24, August 25,
2001 2001
---------------- ----------------
ASSETS
Current assets
Cash and cash equivalents $ 65,572 $ 74,451
Short-term investments 47,539 36,628
Trade accounts receivable, net of allowance for doubtful
accounts 34,046 36,303
Trade accounts receivable due from affiliates 2,369 7,171
Inventories 43,872 47,202
Deferred tax assets and refundable income taxes 9,446 10,424
Other current assets 4,735 7,858
---------------- ----------------
Total current assets 207,579 220,037
---------------- ----------------
Property, plant and equipment, net 102,563 109,131
Other assets
Investments 11,469 12,295
Intangible assets, net of amortization 50,893 51,766
Other 3,285 2,449
---------------- ----------------
Total assets $375,789 $395,678
================ ================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Current maturities of long-term debt $ 1,848 $ 2,238
Short-term borrowings 10,070 8,813
Accounts payable 10,405 16,572
Accrued liabilities 25,935 33,630
---------------- ----------------
Total current liabilities 48,258 61,253
---------------- ----------------
Long-term debt, less current maturities 13,541 13,101
Deferred tax liabilities 3,661 3,950
Minority interest in subsidiaries 4,814 5,067
Commitments and contingencies - -
Shareholders' equity
Common stock, $0.01 par value; 200,000,000 authorized; issued
and outstanding shares: 69,767,615 and 69,729,821, respectively 698 697
Additional paid-in capital 121,479 121,449
Retained earnings 182,240 188,156
Accumulated other comprehensive income 1,098 2,005
---------------- ----------------
Total shareholders' equity 305,515 312,307
---------------- ----------------
Total liabilities and shareholders' equity $375,789 $395,678
================ ================
See accompanying notes to consolidated financial statements.
3
ENTEGRIS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended
---------------------------------------
November 24, November 25,
2001 2000
----------------- ------------------
Sales to non-affiliates $40,502 $ 68,602
Sales to affiliates 5,350 34,037
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Net sales 45,852 102,639
Cost of sales 30,657 50,087
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Gross profit 15,195 52,552
Selling, general and administrative expenses 17,359 21,235
Nonrecurring charges 4,001 -
Engineering, research and development expenses 4,312 3,533
----------------- ------------------
Operating (loss) profit (10,477) 27,784
Interest income, net (451) (1,459)
Other expense (income), net (289) 80
----------------- ------------------
(Loss) income before income taxes and other items below (9,737) 29,163
Income tax (benefit) expense (3,700) 11,081
Equity in net income of affiliates - (738)
Minority interest in subsidiaries' net (loss) income (121) 708
----------------- ------------------
Net (loss) income $(5,916) $ 18,112
================= ==================
(Loss) earnings per common share:
Basic $(0.08) $0.26
Diluted $(0.08) $0.25
Weighted shares outstanding:
Basic 69,742 68,362
Diluted 69,742 72,838
See accompanying notes to consolidated financial statements.
4
ENTEGRIS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
Three months ended
-------------------------------------
November 24, November 25,
2001 2000
---------------- ----------------
OPERATING ACTIVITIES
Net (loss) income $(5,916) $18,112
Adjustments to reconcile net (loss) income to net cash provided
by operating activities:
Depreciation and amortization 6,871 6,037
Asset impairment 2,300 750
Provision for doubtful accounts (194) 550
Provision for deferred income taxes (287) 4
Equity in net income of affiliates - (738)
Loss on sale of property and equipment 265 44
Minority interest in subsidiaries' net (loss) income (121) 708
Changes in operating assets and liabilities:
Trade accounts receivable 2,450 (2,973)
Trade accounts receivable due from affiliates 4,802 (6,071)
Inventories 3,330 (5,380)
Accounts payable and accrued liabilities (13,862) (1,293)
Other current assets 3,122 (788)
Accrued income taxes and refundable income taxes 978 8,947
Other (458) (723)
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Net cash provided by operating activities 3,280 17,186
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INVESTING ACTIVITIES
Acquisition of property and equipment (2,632) (4,006)
Purchases of intangible assets (135) (83)
Proceeds from sales of property and equipment 236 117
Purchases of short-term investments (30,326) -
Maturities of short-term investments 19,415 -
Other 45 1,506
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Net cash used in investing activities (13,397) (2,466)
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FINANCING ACTIVITIES
Principal payments on short-term borrowings and long-term debt (3,462) (536)
Proceeds from short-term borrowings and long-term debt 4,768 226
Issuance of common stock 32 212
Repurchase of common stock - (190)
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Net cash provided by (used in) financing activities 1,338 (288)
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Effect of exchange rate changes on cash and cash equivalents (100) (197)
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(Decrease) increase in cash and cash equivalents (8,879) 14,235
Cash and cash equivalents at beginning of period 74,451 102,973
----------------- -----------------
Cash and cash equivalents at end of period $65,572 $117,208
================= =================
See accompanying notes to consolidated financial statements.
5
ENTEGRIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands)
1. Summary of Significant Accounting Policies
------------------------------------------
In the opinion of the Company, the accompanying unaudited consolidated
financial statements contain all adjustments necessary to present fairly,
in conformity with accounting principles generally accepted in the United
States of America, the financial position as of November 24, 2001 and
August 25, 2001, the results of operations for the three months ended
November 24, 2001 and November 25, 2000 and cash flows for the three months
ended November 24, 2001 and November 25, 2000. Certain prior year amounts
have been reclassified to conform to the current period presentation.
The financial statements and notes are presented as permitted by Form 10-Q
and do not contain certain information included in the Company's annual
consolidated financial statements and notes. The information included in
this Form 10-Q should be read in conjunction with Management's Discussion
and Analysis and financial statements and notes thereto included in the
Company's Form 10-K for the year ended August 25, 2001. The results of
operations for the three months ended November 24, 2001 and November 25,
2000 are not necessarily indicative of the results to be expected for the
full year.
The Company's fiscal year ends on the last Saturday of August. In fiscal
2002, the Company's interim quarters end on November 24, 2001, March 2,
2002 and June 1, 2002.
2. (Loss) earnings per share
-------------------------
The following table presents a reconciliation of the denominators used in
the computation of basic and diluted (loss) earnings per share.
Three Months Ended
----------------------------
November 24, November 25,
2001 2000
------------ ------------
Basic (loss) earnings per share-weighted
common shares outstanding 69,742,000 68,362,000
Weighted common shares assumed upon
exercise of stock options - 4,476,000
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Diluted (loss) earnings per
share-weighted common shares and common
shares equivalent outstanding
69,742,000 72,838,000
========== ==========
The effect of the inclusion of stock options in the first quarter of fiscal
2002 is anti-dilutive.
3. Inventories
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Inventories consist of the following (in thousands):
November 24, 2001 August 25, 2001
----------------- ---------------
Raw materials $13,982 $15,167
Work-in process 1,695 1,451
Finished goods 27,597 29,971
Supplies 598 613
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Total inventories $43,872 $47,202
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6
4. Comprehensive (Loss) Income
---------------------------
For the quarters ended November 24, 2001 and November 25, 2000 net (loss)
income, items of other comprehensive (loss) income and comprehensive (loss)
income are as follows (in thousands):
Quarter ended
----------------------------
November 24, November 25,
2001 2000
------------ ------------
Net (loss) income $(5,916) $18,112
Items of other comprehensive (loss) income
Foreign currency translation (376) (601)
Unrealized loss in marketable securities (531) (343)
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Comprehensive (loss) income $(6,823) $17,168
======= =======
5. Recently Issued Accounting Pronouncements
-----------------------------------------
In June 2001, the Financial Accounting Standards Board issued SFAS No. 141,
Business Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets.
Major provisions of these statements are as follows: all business combinations
must now use the purchase method of accounting, the pooling of interest method
of accounting is now prohibited; intangible assets acquired in a business
combination must be recorded separately from goodwill if they arise from
contractual or other legal rights or are separable from the acquired entity and
can be sold, transferred, licensed, rented or exchanged, either individually or
as a part of a related contract, asset or liability; goodwill and intangible
assets with indefinite lives are not amortized, but tested for impairment
annually, except in certain circumstances, and whenever there is an impairment
indicator; all acquired goodwill must be assigned to reporting units for
purposes of impairment testing and segment reporting; upon adoption of SFAS 142,
goodwill is no longer subject to amortization.
The Company adopted SFAS No. 141 and SFAS No. 142 as of August 26, 2001. As
required by SFAS 142, the Company is in the process of performing an impairment
test on goodwill as of the adoption date. Thereafter, the Company will perform
impairment tests annually and whenever events or circumstances occur indicating
that goodwill or other intangible assets might be impaired. As of August 26,
2001, the Company is no longer amortizing goodwill. Goodwill amortization
expense was $0.2 million net of income taxes for the quarter ended November 25,
2000. The Company estimates that goodwill amortization expense would have been
approximately $0.6 million net of income taxes in the first quarter of fiscal
2002. The following table presents a reconciliation of net (loss) income and
(loss) earnings per share adjusted for the exclusion of goodwill, net of income
taxes (in thousands, except per share figures):
Three months ended
----------------------------------------
November 24, November 25, November 27,
Net income (loss): 2001 2000 1999
- ------------------ ------------ ------------ ------------
Reported net (loss) income $ (5,916) $18,112 $12,054
Add: Goodwill amortization, net of tax - 192 183
-------- ------- -------
Adjusted net (loss) income $ (5,916) $18,304 $12,237
======== ======= =======
Three months ended
----------------------------------------
November 24, November 25, November 27,
Basic (loss) earnings per share: 2001 2000 1999
- -------------------------------- ------------ ------------ ------------
Reported basic (loss) earnings
per share $ (0.08) $0.26 $(0.56)
Add: Goodwill amortization, net of tax - - -
------- ----- ------
Adjusted basic (loss) earnings
per share $ (0.08) $0.26 $(0.56)
======= ===== ======
7
Three months ended
----------------------------------------
November 24, November 25, November 27,
Diluted (loss) earnings per share: 2001 2000 1999
- ---------------------------------- ------------ ------------ ------------
Reported basic (loss) earnings
per share $ (0.08) $0.25 $(0.56)
Add: Goodwill amortization, net of tax - - -
------- ----- ------
Adjusted diluted (loss) earnings
per share $ (0.08) $0.25 $(0.56)
======= ===== ======
As of August 25, 2001, goodwill amounted to $20.1 million. There were no
additions during the first quarter of fiscal 2002. Other intangible assets,
which include patents and other identifiable intangible assets of $30.8 million
as of November 24, 2001, are being amortized over their useful lives and are as
follows (in thousands):
As of November 24, 2001
----------------------------------
Gross carrying Accumulated
Amortized intangible assets: amount amortization
- ------------------------------------ -------------- ------------
Patents $ 14,446 $ 2,197
Unpatented technology 9,844 461
Employment and noncompete agreements 6,211 264
Other 3,657 446
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$ 34,158 $ 3,368
======== =======
Aggregate amortization expense for the quarter ended November 24, 2001 amounted
to $1.0 million. Estimated amortization expense for the fiscal years 2002 to
2006 is $3.8 million, $3.8 million, $3.7 million, $3.7 million and $3.6 million,
respectively.
In October 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or
Disposal of Long-Lived Assets, which addresses financial accounting and
reporting for the impairment or disposal of long-lived assets. While SFAS No.
144 supersedes SFAS No.121, Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of, it retains many of the fundamental
provisions of that Statement. SFAS No. 144 becomes effective for fiscal years
beginning after December 15, 2001. The Company is evaluating SFAS No. 144 to
determine the impact on its financial condition and results of operations.
8
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
-----------------------------------------------------------
Quarter Ended November 24, 2001 Compared to Quarter Ended November 25, 2000
The following table compares quarterly results with year-ago results, as a
percentage of sales, for each caption.
Three Months Ended
----------------------------
November 24, November 25,
2001 2000
------------ ------------
Net sales 100.0 100.0
Cost of sales 66.9 48.8
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Gross profit 33.1 51.2
Selling, general and administrative expenses 37.9 20.7
Nonrecurring charges 8.7 -
Engineering, research and development expenses 9.4 3.4
----- -----
Operating (loss) profit (22.8) 27.1
Interest income net (1.0) (1.4)
Other expense (income), net (0.6) 0.1
----- -----
(Loss) income before income taxes and other
items below (21.2) 28.4
Income tax (benefit) expense (8.1) 10.8
Equity in net earnings of affiliated companies 0.0 (0.7)
Minority interest in subsidiaries' net (loss)
income (0.3) 0.7
----- -----
Net (loss) income (12.9) 17.6
===== =====
Effective tax rate 38.0 38.0
Net sales. Net sales were $45.9 million in the first quarter of fiscal 2002,
down 55% compared to $102.6 million in the first quarter of fiscal 2001. The
sharp decline reflected the decrease in product sales associated with the severe
downturn in the semiconductor industry, which began in the second half of fiscal
2001. Lower revenues were recorded in all geographic regions and across nearly
all product lines. Sales for the Company's Fluid Handling Group which are
closely tied to industry capital spending cycles, declined 76% from first
quarter 2001. The Company's Microelectronics Group also saw a sales decline of
44% from one year ago. International sales accounted for approximately 51% of
net sales in the first quarter of fiscal 2002 compared to 48% in the first
quarter of fiscal 2001. While the business environment continues to be
uncertain, the Company expects sales for the second quarter of fiscal 2002 to be
about flat with first quarter fiscal 2002 levels
Gross profit. Gross profit in the first quarter of fiscal 2002 dropped by $37.4
million to $15.2 million, a decrease of 71% from the $52.6 million reported in
the first quarter of fiscal 2001. The gross margin for the fiscal 2002 first
quarter declined to 33.1% compared to 51.2% a year ago. Gross margin and gross
profit declines were reported by both domestic and international operations. The
drops in fiscal 2002 figures were primarily caused by the lower sales levels
noted above, which resulted in lower production levels. Partly offsetting the
declines was the reversal of profit-sharing accruals of $0.4 million (of a
Company total of $0.8 million, the remainder being included in selling, general
and administrative, and engineering, research and development expenses) made
earlier in calendar 2001while the Company generated net earnings. The first
quarter of fiscal 2001 also included an asset impairment charge of $0.8 million
mainly for asset write-offs of molds that were determined to have no future use.
Selling, general and administrative expenses. Selling, general and
administrative (SG&A) expenses decreased $3.8 million, or 18%, to $17.4 million
in the first quarter of fiscal 2002 from $21.2 million in the first quarter of
fiscal 2001. The decrease was due to the significantly lower
9
bonus and charitable contribution accruals, which are largely based on company
profitability. SG&A costs, as a percent of net sales, increased to 37.9% from
20.7%.
Nonrecurring charges. The first quarter of 2002 includes a nonrecurring charge
of $4.0 million in connection with the closures of the Company's Chanhassen, MN
and one of its Chaska, MN plants. The charge included $1.5 million in
termination costs related to a workforce reduction of 230 employees and $2.3
million for estimated losses for asset impairment.
Engineering, research and development expenses. Engineering, research and
development expenses were $4.3 million in the first quarter of fiscal 2002, up
18% compared to $3.5 million in the first quarter of fiscal 2001. Engineering,
research and development costs, as a percent of net sales, increased to 9.4%
from 3.4% reflecting both higher ER&D expenditures and lower net sales.
Interest income, net. Net interest income of $0.5 million in the first quarter
of fiscal 2002 compared $1.5 million in the year-ago period. The change reflects
the lower rates of interest on marketable securities and a shift in the mix of
investments to tax exempt securities.
Other expense (income), net. Other income was $0.3 million in the first quarter
of fiscal 2002 compared to other expense of $80 thousand in the first quarter a
year ago. The change mainly reflects the foreign currency gains associated with
forward foreign currency contracts.
Income tax (benefit) expense. An income tax benefit of $3.7 million in the first
quarter of fiscal 2002 compared to income tax expense of $11.1 million reported
a year earlier, reflected the Company's pre-tax operating results. The effective
tax rate was 38% in the first quarter of both fiscal 2002 and fiscal 2001.
Equity in net income of affiliates. Equity in the net income of affiliates was
zero in the first quarter of fiscal 2002 compared to $0.7 million in the first
quarter a year earlier. This reflects the change in accounting for the Company's
investment in Metron, which was recorded under the equity method of accounting
through the second quarter of fiscal 2001 at which time the Company began
accounting for its remaining investment as an available-for-sale security, as
our ownership percentage was reduced.
Net (loss) income. The Company recorded a net loss of $5.9 million, or $0.08 per
diluted share, in the first quarter of fiscal 2002, compared to net income of
$18.1 million, or $0.25 per diluted share, in the year-ago period.
Liquidity and Capital Resources
Operating activities. Cash flow provided by operating activities totaled $3.3
million in the first quarter of fiscal 2002. Noncash charges, such as
depreciation and amortization of $6.9 million, as well as decreases in inventory
of $3.3 million and in accounts receivable of $7.3 million were partly offset by
the Company's net loss and a $13.9 reduction in payable and accruals. Working
capital at November 24, 2001 stood at $159.3 million, including $113.1 million
in cash, cash equivalents and short-term investments.
Investing activities. Cash flow used in investing activities totaled $13.4
million in the first quarter of fiscal 2002. Acquisition of property and
equipment totaled $2.6 million and included additions of manufacturing equipment
and the upgrading and integration of information systems. The Company expects
capital expenditures of approximately $25 to $30 million during fiscal 2002,
consisting mainly of spending on manufacturing equipment and information
systems. The company had purchases, net of maturities of short-term investments
of $10.9 million during the quarter.
Financing activities. Cash provided by financing activities totaled $1.3 million
during the first quarter of fiscal 2002. The company made scheduled payments
$3.5 million on borrowings, while proceeds from short-term borrowings were $4.8
million.
10
As of November 24, 2001, our sources of available funds comprised $113.1 million
in cash, cash equivalents, short-term investments plus various credit
facilities. We have unsecured revolving commitments with two commercial banks
with aggregate borrowing capacity of $30 million, with no borrowings outstanding
at November 24, 2001. We also have lines of credit, equivalent to an aggregate
of approximately $9.2 million with six international banks, which provide for
borrowings of the European Euro, Malaysian ringgits and Japanese yen for our
overseas subsidiaries. Borrowings outstanding on these lines of credit were $4.1
million at November 24, 2001. The company also owed $5.9 million in other
short-term bank borrowings not subject to formal credit agreements.
At November 24, 2001, the Company's shareholders' equity stood at $305.5
million. Book value per share was $4.38, down from $4.48 per share at the end of
fiscal 2001. The quarter's net loss accounted for the decrease.
The company believes its cash and cash equivalents, cash flow from operations
and available credit facilities will be sufficient to meet our working capital
and investment requirements for the next twelve months. However, future growth,
including potential acquisitions, may require additional funding, and from time
to time the Company may need to raise capital through additional equity or debt
financing.
Recently Issued Accounting Pronouncements
In June 2001, the Financial Accounting Standards Board issued SFAS No. 141,
Business Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets.
Major provisions of these statements are as follows: all business combinations
must now use the purchase method of accounting, the pooling of interest method
of accounting is now prohibited; intangible assets acquired in a business
combination must be recorded separately from goodwill if they arise from
contractual or other legal rights or are separable from the acquired entity and
can be sold, transferred, licensed, rented or exchanged, either individually or
as a part of a related contract, asset or liability; goodwill and intangible
assets with indefinite lives are not amortized, but tested for impairment
annually, except in certain circumstances, and whenever there is an impairment
indicator; all acquired goodwill must be assigned to reporting units for
purposes of impairment testing and segment reporting; upon adoption of SFAS 142,
goodwill is no longer subject to amortization.
The Company adopted the provisions of these statements as of August 26, 2001. As
required by SFAS 142, the Company is in the process of performing an impairment
test on goodwill as of the adoption date. Thereafter, the Company will perform
impairment tests annually and whenever events or circumstances occur indicating
that goodwill or other intangible assets might be impaired. As of August 26,
2001, the Company is no longer amortizing goodwill. Goodwill amortization
expense was $0.2 million net of income taxes for the quarter ended November 25,
2000. The Company estimates that goodwill amortization expense would have been
approximately $0.6 million net of income taxes in the first quarter of fiscal
2002.
As of August 25, 2001, goodwill amounted to $20.3 million. There were no
additions during the first quarter of fiscal 2002. Other intangible assets,
which include patents and other identifiable intangible assets of $30.6 million
as of November 24, 2001, are being amortized over their useful lives.
In October 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or
Disposal of Long-Lived Assets, which addresses financial accounting and
reporting for the impairment or disposal of long-lived assets. While SFAS No.
144 supersedes SFAS No.121, Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of, it retains many of the fundamental
provisions of that Statement. SFAS No. 144 becomes effective for fiscal years
beginning after December 15, 2001. The Company is evaluating SFAS No. 144 to
determine the impact on its financial condition and results of operations.
11
Cautionary Statements
This report contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements may include
forward-looking statements which reflect the Company's current views with
respect to future events and financial performance. The words "believe,"
"expect," "anticipate," "intends," "estimate," "forecast," "project," "should"
and similar expressions are intended to identify "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. All
forecasts and projections in this document are "forward-looking statements," and
are based on management's current expectations of the Company's near-term
results, based on current information available pertaining to the Company,
including the risk factors identified in the Company's Annual Report on Form
10-K for the fiscal year ended August 25, 2001.
Item 3: Quantitative and Qualitative Disclosures About Market Risk
- ------------------------------------------------------------------
Entegris's principal market risks are sensitivities to interest rates and
foreign currency exchange rates. The Company's current exposure to interest rate
fluctuations is not significant. Most of its outstanding debt at November 24,
2001 carried fixed rates of interest. All of the Company's cash equivalents and
short-term investments are debt instruments with remaining maturities of 12
months or less.
The Company uses derivative financial instruments to manage foreign currency
exchange rate risk associated with the sale of products from the United States
when such sales are denominated in currencies other than the U.S. dollar. The
cash flows and earnings of foreign-based operations are also subject to
fluctuations in foreign exchange rates. A hypothetical 10% change in the foreign
currency exchange rates would potentially increase or decrease net income by
approximately $1 million.
12
PART II
OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
- ----------------------------------------
(a) Exhibits:
None
13
CONFORMED COPY
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ENTEGRIS, INC.
Date: January 8, 2002 /s/ James E. Dauwalter
-------------------------------------
James E. Dauwalter
President and Chief Executive Officer
Date: January 8, 2002 /s/ John D. Villas
-------------------------------------
John D. Villas
Executive Vice President and
Chief Financial Officer
14