Axcelis Announces Financial Results for the Fourth Quarter and Full Year 2005
BEVERLY, Mass.--(BUSINESS WIRE)--Feb. 8, 2006--Axcelis Technologies, Inc. (Nasdaq: ACLS) today announced financial results for its fourth quarter and full-year ended December 31, 2005. The Company reported revenues of $92.9 million, compared to $87.4 million for the third quarter of 2005. Worldwide revenues for the fourth quarter, which include revenues of SEN, the Company's 50% owned joint venture in Japan, were $155.1 million, compared to $126.3 million for the preceding quarter. Net loss for the fourth quarter was $1.3 million, or $0.01 per share, which included restructuring and related costs of $1.7 million, or $0.02 per share. The net loss for the third quarter of 2005 was $5.2 million, or $0.05 per share.
For the full year 2005, the Company reported revenues of $372.5 million compared with $508.0 million in 2004. Worldwide revenues, which include revenues of SEN, were $627.4 million in 2005 compared to $837.7 million in 2004. Net loss for the year was $3.9 million, or $0.04 per share, including the effect of relocation and restructuring charges of $11.4 million, or $0.11 per share, related to the consolidation of the Company's Rockville, MD and Beverly, MA operations. The Company reported net income of $74.2 million, or $0.73 per diluted share, in 2004.
Commenting on the Company's performance, Chairman and CEO Mary Puma said, "Our operating results exceeded our guidance for the fourth quarter reflecting continuing improvements to our cost structure and stronger gross margins. We achieved a 96% quarter-over-quarter increase in systems orders by successfully penetrating the market with our new Optima ion implant platform and capitalizing on the continued demand for our multiwafer implanters."
"Customers have been actively seeking alternative tools in the market, and they are responding very enthusiastically to the Optima platform. This is validated by the fact that we met our goal to achieve 10 design-in wins for tools based on Optima technology in 2005. Last month, we followed up the successful market penetration of the Optima MD mid dose implanter with the launch of the Optima HD high dose implanter. We expect to ship our first Optima HDs in the second quarter of this year and anticipate shipments of Optima products to exceed $60 million for 2006. With improving market conditions, and the traction we are gaining with our new tools, we are confident about the year ahead."
Axcelis believes that reporting the combined revenues of SEN, a 50% owned unconsolidated subsidiary of Axcelis, with Axcelis' own revenues, is useful to investors. SEN's ion implant products are covered by a license from Axcelis and therefore the combined revenue of the two companies indicates the full market penetration of Axcelis' technology.
Fourth Quarter Detail
Shipments and Margins
Shipments before provision for deferred revenue for the fourth quarter on a worldwide basis, including SEN, totaled $144.8 million with shipments, excluding SEN, totaling $85.6 million. Worldwide shipments, including SEN, were up 1.3% from the third quarter of 2005 and Axcelis shipments, excluding SEN, were down 3.7%.
Geographically, Axcelis systems shipments, excluding SEN, were to: Asia 71%, North America 22% and Europe 7%.
The ion implantation business (excluding SEN) accounted for 81% of total shipments in the fourth quarter while other products (RTP, Dry Strip and Curing) accounted for 19%.
Service revenue (service labor, spare parts and consumables), excluding SEN, was $40.9 million for the quarter, up 4.1% from the third quarter of 2005.
Gross margin for the fourth quarter was 40.9%, at the same level reported for the preceding quarter.
Orders and Backlog
Orders (new systems bookings and service excluding SEN) received for the fourth quarter totaled $98.8 million, compared to $68.9 million for the third quarter of 2005. New system bookings, excluding service, amounted to $57.9 million compared to $29.6 million for the preceding quarter. Worldwide orders, including SEN, were $151.0 million, compared to $118.3 million for the third quarter of 2005.
Backlog plus deferred systems revenue at quarter end was $88.3 million, an increase of 10.1% since the end of the third quarter of 2005. Backlog consists of systems only (i.e., excluding service contracts) that are generally scheduled to ship within six months.
Balance Sheet
Cash, cash equivalents and short-term investments decreased by $7.8 million to $176.4 million at December 31, 2005. The Company ended the year with working capital of $301 million.
Business Outlook
Axcelis' financial outlook for the first quarter of 2006 assumes no material change in the semiconductor spending environment. Revenues in the first quarter are expected to be in a range of $90 million to $100 million. Worldwide revenues, including SEN, are expected to be $160 million to $175 million. The Company anticipates gross margins in the 40% range and results of operations to approximate breakeven for the quarter.
Axcelis assumes no responsibility to update guidance. Axcelis will only confirm or update guidance via a press release.
Fourth Quarter 2005 Conference Call
The Company will be hosting a conference call today, Wednesday, February 8, 2006, beginning at 5:00 pm ET. The purpose of the call is to discuss fourth quarter 2005 results and to provide guidance for the first quarter of 2006. The call will be available to interested listeners via an audio webcast that can be accessed through Axcelis' home page at www.axcelis.com, or by dialing 1-800-479-1628 (1-719-457-2729 outside North America). Participants calling into the conference call will be requested to provide the company name: Axcelis Technologies, the conference leader: James Kawski, and pass code: #3894917. A telephone replay will be available from 8:00 pm ET on February 8, 2006 until 11:59 pm ET on February 15, 2006. Dial 1-888-203-1112 (1-719-457-0820 outside North America), and enter conference ID code #3894917. A webcast replay will be available from 8:00 pm ET on February 8, 2006 until 5:00 pm ET March 8, 2006.
Safe Harbor Statement
This document contains forward-looking statements under the SEC safe harbor provisions. These statements, which include those relating to the company developing new products, building its position in the ion inplant market, and its guidance for the first quarter of 2006, are based on management's current expectations and should be viewed with caution. They are subject to various risks and uncertainties, many of which are outside the control of the Company, including the timing of orders and shipments, the conversion of orders to revenue in any particular quarter, or at all, our ability to implement successfully our profit plans, the continuing demand for semiconductor equipment, relative market growth, continuity of business relationships with and purchases by major customers, competitive pressure on sales and pricing, increases in material and other production costs that cannot be recouped in product pricing and global economic, political and financial conditions. These risks and other risk factors relating to Axcelis are described more fully in the most recent Form 10-K filed by Axcelis and in other documents filed from time to time with the Securities and Exchange Commission.
About Axcelis Technologies, Inc.
Axcelis Technologies, Inc., headquartered in Beverly, Massachusetts, provides innovative, high-productivity solutions for the semiconductor industry. Axcelis is dedicated to developing enabling process applications through the design, manufacture and complete life cycle support of ion implantation, rapid thermal processing, and cleaning and curing systems. Axcelis Technologies has key product development centers in Beverly, Massachusetts, as well as in Toyo, Japan through its joint venture, SEN. The company's Internet address is: www.axcelis.com.
Axcelis Technologies, Inc.
Consolidated Balance Sheets
In thousands
(Unaudited)
December 31, December 31,
2005 2004
----------- -----------
Assets
Current assets
Cash and cash equivalents $ 71,417 $ 108,295
Short-term investments 93,797 78,703
Restricted cash 8,037 3,498
Accounts receivable, net 79,379 83,767
Inventories 109,972 116,330
Prepaid expenses and other current assets 32,767 14,986
----------- -----------
Total current assets 395,369 405,579
Property, plant & equipment, net 71,443 75,275
Investment in Sumitomo Eaton Nova Corporation 108,815 109,095
Goodwill 46,773 46,773
Intangible assets 16,100 17,671
Restricted cash, long-term portion 3,195 2,841
Other assets 19,748 31,628
----------- -----------
$ 661,443 $ 688,862
=========== ===========
Liabilities and stockholders' equity
Current liabilities
Accounts payable $ 25,556 $ 24,278
Accrued compensation 18,437 27,030
Warranty 5,739 9,218
Income taxes 3,021 4,530
Deferred revenue 30,140 34,050
Other current liabilities 11,333 8,289
----------- -----------
Total current liabilities 94,226 107,395
Long-term debt 125,000 125,000
Long-term deferred revenue 11,177 7,697
Other long-term liabilities 4,999 5,297
Stockholders' equity
Preferred Stock - -
Common stock 101 100
Additional paid-in capital 466,454 457,335
Deferred compensation (5,385) (566)
Treasury stock (1,218) (1,218)
Accumulated deficit (31,187) (27,332)
Accumulated other comprehensive income (loss) (2,724) 15,154
----------- -----------
426,041 443,473
----------- -----------
$ 661,443 $ 688,862
=========== ===========
Axcelis Technologies, Inc.
Consolidated Statements of Operations
In thousands, except per share amounts
(Unaudited)
Three months ended Twelve months ended
December 31, December 31,
------------------- -------------------
2005 2004 2005 2004
-------- -------- -------- --------
Revenue
Systems $ 50,364 $ 48,529 $206,087 $326,521
Services 40,920 41,930 157,644 167,027
Royalties, primarily from
Sumitomo Eaton Nova
Corporation 1,660 4,048 8,809 14,428
-------- -------- -------- --------
92,944 94,507 372,540 507,976
Cost of Revenue 54,953 55,634 218,109 296,448
-------- -------- -------- --------
Gross profit 37,991 38,873 154,431 211,528
Operating expenses
Research & development 19,743 15,200 70,908 63,209
Sales and marketing 10,261 10,910 44,826 47,593
General and administrative 10,635 11,504 45,631 46,149
Amortization of
intangible assets 612 612 2,448 2,448
Restructuring charges 1,070 994 6,497 994
-------- -------- -------- --------
42,321 39,220 170,310 160,393
-------- -------- -------- --------
Income (loss) from operations (4,330) (347) (15,879) 51,135
Other income (expense)
Equity income of Sumitomo
Eaton Nova Corporation 4,391 8,319 15,751 30,531
Interest income 1,660 827 5,459 2,032
Interest expense (1,663) (1,656) (6,634) (6,673)
Other-net (677) (795) (679) (1,886)
-------- -------- -------- --------
3,711 6,695 13,897 24,004
-------- -------- -------- --------
Income (loss) before income
taxes (619) 6,348 (1,982) 75,139
Income taxes (credit) 716 (693) 1,873 964
-------- -------- -------- --------
Net income (loss) $ (1,335) $ 7,041 $ (3,855) $ 74,175
======== ======== ======== ========
Net income (loss) per share
Basic $ (0.01) $ 0.07 $ (0.04) $ 0.75
Diluted $ (0.01) $ 0.07 $ (0.04) $ 0.73
Shares used in computing net
income (loss) per share
Basic 100,435 99,814 100,301 99,528
Diluted 100,435 100,620 100,301 101,205
CONTACT: Media:
Axcelis Technologies, Inc.
Maureen Hart, 978-787-4266
Fax: 978-787-4275
maureen.hart@axcelis.com
or
Investor:
James L. Kawski, 978-787-4268
Fax: 978-787-9133
investor.relations@axcelis.com
or
Agency:
The Loomis Group Inc.
Heather Smith, 617-638-0022
Fax: 617-638-0033
smithh@loomisgroup.com
SOURCE: Axcelis Technologies, Inc.
