UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[Mark One]
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2004
OR
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number 0-26482
TRIKON TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 95-4054321 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
| Ringland Way, Newport, South Wales NP18 2TA, United Kingdom |
||
| (Address of principal executive offices) | (Zip Code) | |
Registrant’s telephone number, including area code 44-1633-414-000
Not Applicable
Former name, former address and former fiscal year, if changed since last report
Indicate by check whether the registrant (1) has filed all reports required to be filed by Sections 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 ¨
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes x No ¨
As of October 22, 2004, the total number of outstanding shares of the Registrant’s common stock was 15,752,309.
INDEX
| PAGE NUMBER | ||||
| PART I. FINANCIAL INFORMATION |
||||
| Item 1. |
||||
| Condensed Consolidated Balance Sheets at September 30, 2004 and December 31, 2003 |
3 | |||
| 4 | ||||
| 5 | ||||
| 6 | ||||
| Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
9 | ||
| Item 3. |
22 | |||
| Item 4. |
22 | |||
| PART II. |
||||
| Item 1. |
23 | |||
| Item 2. |
23 | |||
| Item 3 |
23 | |||
| Item 4. |
23 | |||
| Item 5. |
24 | |||
| Item 6. |
24 | |||
| 25 | ||||
| Exhibits |
||||
| 31.1 |
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule15d-14(a) of the Exchange Act | |||
| 31.2 |
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Exchange Act | |||
| 32.1 |
Certification of Chief Executive Officer furnished pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350), as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||
| 32.2 |
Certification of Chief Financial Officer furnished pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C 1350), as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||
2
Trikon Technologies, Inc.
PART 1 - FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
| September 30, 2004 |
December 31, 2003 |
|||||||
| (Unaudited) | (Note A) | |||||||
| Assets |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 19,009 | $ | 31,646 | ||||
| Accounts receivable, net |
10,547 | 11,287 | ||||||
| Inventories, net |
15,465 | 15,257 | ||||||
| Prepaid and other current assets |
3,034 | 4,855 | ||||||
| Total current assets |
48,055 | 63,045 | ||||||
| Property, equipment and leasehold improvements, net |
14,091 | 16,896 | ||||||
| Demonstration systems, net |
1,270 | 2,814 | ||||||
| Other assets |
377 | 374 | ||||||
| Total assets |
$ | 63,793 | $ | 83,129 | ||||
| Liabilities and shareholders’ equity |
||||||||
| Current liabilities: |
||||||||
| Short term borrowing |
$ | 9,050 | $ | — | ||||
| Accounts payable and accrued expenses. |
5,663 | 5,785 | ||||||
| Current portion of long-term debt |
220 | 11,736 | ||||||
| Deferred revenue |
2,292 | 5,803 | ||||||
| Other current liabilities |
1,290 | 2,635 | ||||||
| Accrued expenses. |
1,786 | 1,399 | ||||||
| Warranty and related expenses. |
1,032 | 1,285 | ||||||
| Total current liabilities |
21,333 | 28,643 | ||||||
| Long-term debt less current portion |
16 | 188 | ||||||
| Other non-current liabilities . |
783 | 928 | ||||||
| $ | 22,132 | $ | 29,759 | |||||
| Shareholders’ equity: |
||||||||
| Preferred Stock: |
||||||||
| Authorized shares — 20,000,000 |
||||||||
| Issued and outstanding — Nil at September 30, 2004 and December 31, 2003 |
$ | — | $ | — | ||||
| Common Stock, $0.001 par value: |
||||||||
| Authorized shares — 50,000,000 |
||||||||
| Issued and outstanding —15,752,309 at September 30, 2004 and 15,635,888 at December 31, 2003 |
261,413 | 261,217 | ||||||
| Accumulated other comprehensive loss |
2,105 | 1,833 | ||||||
| Accumulated deficit |
(221,857 | ) | (209,680 | ) | ||||
| Total shareholders’ equity |
41,661 | 53,370 | ||||||
| Total liabilities and shareholders’ equity |
$ | 63,793 | $ | 83,129 | ||||
See Notes to Unaudited Condensed Consolidated Financial Statements.
3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands, except share and per share data)
| Three Months Ended |
Nine Months Ended |
|||||||||||||||
| September 30, 2004 |
September 30, 2003 |
September 30, 2004 |
September 30, 2003 |
|||||||||||||
| Revenues: |
||||||||||||||||
| Product revenues |
$ | 9,858 | $ | 8,364 | $ | 26,702 | $ | 19,435 | ||||||||
| Licence revenues |
17 | 49 | 126 | 98 | ||||||||||||
| 9,875 | 8,413 | 26,828 | 19,533 | |||||||||||||
| Costs and expenses: |
||||||||||||||||
| Cost of goods sold |
5,871 | 5,870 | 18,763 | 15,014 | ||||||||||||
| Research and development |
1,921 | 2,157 | 6,766 | 6,798 | ||||||||||||
| Selling, general and administrative |
4,735 | 4,428 | 14,914 | 14,648 | ||||||||||||
| Restructuring cost |
(1,200 | ) | — | (1,200 | ) | — | ||||||||||
| Settlement of pension liabilities and related expenses |
— | 899 | — | 3,622 | ||||||||||||
| 11,327 | 13,354 | 39,243 | 40,082 | |||||||||||||
| Loss from operations |
(1,452 | ) | (4,941 | ) | (12,415 | ) | (20,549 | ) | ||||||||
| Foreign currency gains (losses) |
7 | (55 | ) | 366 | 100 | |||||||||||
| Interest (expense) income, net |
(92 | ) | (165 | ) | 37 | 45 | ||||||||||
| Loss before income tax charge |
(1,537 | ) | (5,161 | ) | (12,012 | ) | (20,404 | ) | ||||||||
| Income tax charge |
45 | 29 | 165 | 187 | ||||||||||||
| Net loss |
$ | (1,582 | ) | $ | (5,190 | ) | $ | (12,177 | ) | $ | (20,591 | ) | ||||
| Loss per share data |
||||||||||||||||
| Basic: |
$ | (0.10 | ) | $ | (0.37 | ) | $ | (0.77 | ) | $ | (1.53 | ) | ||||
| Diluted: |
$ | (0.10 | ) | $ | (0.37 | ) | $ | (0.77 | ) | $ | (1.53 | ) | ||||
| Weighted average common shares used in the calculation: |
||||||||||||||||
| Basic: |
15,752 | 14,078 | 15,733 | 13,484 | ||||||||||||
| Diluted: |
15,752 | 14,078 | 15,733 | 13,484 | ||||||||||||
See Notes to Unaudited Condensed Consolidated Financial Statements.
4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In thousands)
| Nine Months Ended |
||||||||
| September 30, 2004 |
September 30, 2003 |
|||||||
| Operating Activities |
||||||||
| Net loss. |
$ | (12,177 | ) | $ | (20,591 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
| Depreciation and amortization of property plant and equipment |
4,050 | 3,671 | ||||||
| Amortization of deferred compensation |
— | 569 | ||||||
| (Loss) gain on disposal of property plant and equipment |
(13 | ) | 9 | |||||
| Provision for losses on accounts receivable |
(22 | ) | 46 | |||||
| Changes in operating assets and liabilities: |
||||||||
| Accounts receivable |
762 | (1,399 | ) | |||||
| Inventories (including demonstration systems) |
1,336 | 3,100 | ||||||
| Other current assets |
1,821 | (172 | ) | |||||
| Accounts payable and other liabilities |
(1,171 | ) | 403 | |||||
| Income tax payable |
(162 | ) | — | |||||
| Pension obligations |
— | 1,865 | ||||||
| Deferred revenue |
(3,511 | ) | 1,138 | |||||
| Net cash used in operating activities |
(9,087 | ) | (11,361 | ) | ||||
| Investing Activities |
||||||||
| Purchases of property, equipment and leasehold improvements |
(1,673 | ) | (650 | ) | ||||
| Proceeds from sale of property, plant and equipment |
651 | — | ||||||
| Other assets and liabilities |
(148 | ) | (78 | ) | ||||
| Net cash used in investing activities |
(1,170 | ) | (728 | ) | ||||
| Financing Activities |
||||||||
| Issuance of common stock |
196 | 100 | ||||||
| Borrowings under short term loan |
9,050 | — | ||||||
| Repayments under bank credit lines |
(11,188 | ) | (6,113 | ) | ||||
| Payments on capital lease obligations |
(500 | ) | (522 | ) | ||||
| Net cash used in financing activities |
(2,442 | ) | (6,535 | ) | ||||
| Effect of exchange rate changes in cash |
62 | 1,192 | ||||||
| Net decrease in cash and cash equivalents |
(12,637 | ) | (17,432 | ) | ||||
| Cash and cash equivalents at beginning of period |
31,646 | 42,557 | ||||||
| Cash and cash equivalents at end of period |
$ | 19,009 | $ | 25,125 | ||||