Exhibit 99.1
KLA-Tencor Reports Earnings of $116 Million on Revenue of
$519 Million for First Quarter of Fiscal Year 2005
SAN JOSE, Calif.--(BUSINESS WIRE)--Oct. 21, 2004--KLA-Tencor
Corporation (Nasdaq:KLAC) today announced operating results for its
first quarter of fiscal 2005, ended September 30, 2004. Net income and
earnings per diluted share rose to $116 million and $0.58 on revenues
of $519 million, as the company reported sequential and year-over-year
improvements in operating results. Revenues rose 15 percent from $450
million in the prior quarter and 63 percent from $318 million compared
to the same period last year. Net income was also significantly
higher, increasing from $96 million or $0.48 per diluted share in the
prior quarter and $37 million or $0.18 per diluted share in the first
quarter of fiscal 2004.
"Our strong financial results reflect leading chipmakers'
strategic investments in process control technology to help them stay
on Moore's law and reduce the time and costs associated with producing
next-generation chips," explained Ken Schroeder, President and Chief
Executive Officer of KLA-Tencor. "Our customers know that process
control technology is instrumental to increasing their competitiveness
and production success. Going forward we remain focused on investing
in the solutions our customers will need to accelerate their
development and production ramps at future nodes, while also
optimizing the performance of their existing tools and technologies."
KLA-Tencor reported that it ended the quarter with approximately
six months of backlog at current shipping levels. Geographically, the
strongest order activity originated from Japan, which was above its
historical share. Korea, China, and Singapore were also above
historical levels while order levels for the United States, Europe and
Taiwan were below their historical averages during the quarter.
Rising revenues and improved cost-structure resulted in record
level gross margin, pretax, and operating margin percentages in the
current quarter. Operating expenses increased from $141 million in the
prior quarter to $146 million in the current quarter.
Cash, cash equivalents, and marketable securities increased by $10
million to $1.89 billion and the company repurchased $74 million of
its shares during the quarter. Accounts receivable decreased by $7
million to $366 million on strong collections, while inventory
increased by $36 million to $373 million on new product introductions
and higher planned production levels.
Forward Looking Statements: Statements in this press release
regarding the company's positioning for future industry growth, impact
of process control technology, investment decisions by the Company and
the benefits derived from future investments by the Company, current
order backlog, rising demand for semiconductor process control
equipment and cost-saving measures are forward-looking statements, and
are subject to the Safe Harbor provisions created by the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements are based on current information and expectations, and
involve a number of risks and uncertainties. Actual results may differ
materially from those projected in such statements due to various
factors, including but not limited to: delays or cancellations of
orders by customers; shipments or acceptances; inability by the
company to meet its production and/or product development schedules;
the demand for semiconductors; and new and enhanced product offerings
by competitors. For other factors that may cause actual results to
differ from those projected, please refer to the company's Form 10-K,
Forms 10-Q and other filings with the Securities and Exchange
Commission. Actual results could differ materially from those
anticipated in forward-looking statements in this release as a result
of certain factors, including those set forth in the risk factors
described in the company's SEC filings.
About KLA-Tencor: KLA-Tencor is the world leader in yield
management and process control solutions for semiconductor
manufacturing and related industries. Headquartered in San Jose,
Calif., with operations around the world, KLA-Tencor ranked #6 on
S&P's 2002 index of the top 500 companies in the U.S. KLA-Tencor is
traded on the Nasdaq National Market under the symbol KLAC. Additional
information about the company is available on the Internet at
http://www.kla-tencor.com.
KLA-Tencor Corporation
CONDENSED CONSOLIDATED UNAUDITED BALANCE SHEETS
September 30, June 30,
2004 2004
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(In thousands)
ASSETS
Cash, short-term investments and
marketable securities $1,886,256 $1,876,356
Accounts receivable, net 365,529 372,773
Inventories 373,484 337,414
Land, property and equipment, net 380,239 376,052
Other assets 584,499 576,584
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Total assets $3,590,007 $3,539,179
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 53,132 $ 63,991
Deferred system profit 281,455 284,813
Unearned revenue 58,971 57,318
Other current liabilities 511,571 505,507
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Total current liabilities 905,129 911,629
---------- ----------
Stockholders' equity:
Common stock and capital in excess of
par value 918,331 984,804
Retained earnings 1,756,992 1,640,587
Accumulated other comprehensive income 9,555 2,159
---------- ----------
Total stockholders' equity 2,684,878 2,627,550
---------- ----------
Total liabilities and
stockholders' equity $3,590,007 $3,539,179
========== ==========
KLA-Tencor Corporation
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS
Three months ended
September 30,
2004 2003
- ----------------------------------------------------------------------
(In thousands, except per share data)
Revenues:
Product $442,296 $250,145
Service 76,477 67,825
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Total revenues 518,773 317,970
---------- ----------
Costs and operating expenses:
Costs of revenues 215,469 155,541
Engineering, research and development 77,147 65,452
Selling, general and administrative 69,190 60,009
---------- ----------
Total costs and operating expenses 361,806 281,002
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Income from operations 156,967 36,968
Interest income and other, net 6,985 8,401
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Income before income taxes 163,952 45,369
Provision for income taxes 47,547 8,532
---------- ----------
Net income $116,405 $ 36,837
========== ==========
Net income per share:
Basic
Basic net income per share $ 0.59 $ 0.19
========== ==========
Diluted
Diluted net income per share $ 0.58 $ 0.18
========== ==========
Weighted average number of shares;
Basic 196,110 192,699
========== ==========
Diluted 199,969 200,334
========== ==========
CONTACT: John Kispert, 408-875-6224 (Chief Financial Officer)
john.kispert@kla-tencor.com
Cary Halsted, 408-875-4094 (Investment Community)
cary.halsted@kla-tencor.com
Uma Subramaniam, 408-875-5473 (Media)
uma.subramaniam@kla-tencor.com