Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - FEI CO | d8k.htm |
Exhibit 99.1
NEWS RELEASE
For more information contact:
FEI Company
Fletcher Chamberlin
Treasurer & Communications Director
(503) 726-7710
fletcher.chamberlin@fei.com
FEI Reports Record Bookings, Revenue and Earnings for the Fourth Quarter of 2010
Bookings of $218.4 million were up 34% from Last Year’s Fourth Quarter
Revenue of $186.1 million was up 20% from Last Year’s Fourth Quarter
EPS was $0.52, More Than Three Times Last Year’s Fourth Quarter
HILLSBORO, Ore., February 3, 2011 – For the fourth quarter of 2010, FEI Company (NASDAQ: FEIC) reported the highest quarterly bookings, revenue and earnings in the company’s history, with significant year-over-year and sequential quarterly growth. Bookings, revenue and operating income also set records for the full year in 2010.
For the fourth quarter, net bookings were $218.4 million, up 15% from the third quarter of 2010 and up 34% from the fourth quarter of 2009. The backlog at the end of the quarter was $471.9 million, an all-time high. The book-to-bill ratio for the quarter was 1.17 to 1.
Revenue of $186.1 million was up 22% compared to $153.0 million in the third quarter of 2010 and up 20% from $154.4 million in the fourth quarter of 2009.
Net income was $21.3 million or $0.52 per diluted share, compared with $11.9 million or $0.30 per diluted share in the third quarter of 2010 and $6.6 million or $0.17 per diluted share in the fourth quarter of 2009.
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The gross margin in the fourth quarter was 45.0%, compared with 43.5% in the third quarter of 2010 and 38.4% in the fourth quarter of 2009. Operating income was 15.4% of sales in the quarter, compared with 11.5% in the third quarter of 2010 and 5.8% in the fourth quarter of 2009.
Gross cash, investments and restricted cash, net of debt, increased by $41.3 million in the quarter to $334.8 million at year-end.
“This quarter’s record bookings mark our fifth straight quarter of bookings growth,” said Don Kania, president and CEO of FEI, “as each of our market segments recorded sequential and year-over-year growth. Our record revenue was powered by particularly strong shipments to the Electronics market, which also contributed to the highest gross margin percentage in almost a decade. It was an excellent quarter for bookings, revenue, margins and earnings.
“Looking forward, our substantial backlog helps to provide good visibility for the first half of 2011,” Kania continued. “While margins may moderate somewhat from the fourth quarter level due to product mix, we expect continued operating improvements and a growth year for revenue and earnings.”
For the full year 2010, bookings of $751.5 million were up 25% from 2009, and revenue of $634.2 million was up 10% from 2009. Net income was $53.5 million, 136% above 2009’s net income. Diluted earnings per share were $1.34, more than double 2009’s $0.60. Net cash increased by $65.4 million during the year.
Bookings and revenue comparisons for the company’s market segments and other data are included in the supplementary information attached to this release, along with detailed statements of operations and balance sheets.
Guidance for Q1 2011
Assuming a euro exchange rate of $1.40, FEI expects revenue in the first quarter of 2011 to be in the range of $180 million to $190 million. Bookings are expected to be in the range of $175 million to $195 million. GAAP earnings per share are expected to be in the range of $0.43 to $0.49.
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Investor Conference Call — 2:00 p.m. Pacific time, Thursday, February 3, 2011
Parties interested in listening to FEI’s quarterly conference call may do so by dialing 1-800-762-8779 (U.S., toll-free) or 1-480-629-9771 (international and toll), with the conference title: FEI Fourth Quarter Earnings Call, Conference ID 4400158. A telephone replay of the call will be available at 1-800-406-7325 (U.S., toll-free) or 1-303-590-3030 (international and toll) with the passcode: 4400158#. The call can also be accessed via the web by going to FEI’s Investor Relations page at www.fei.com, where the webcast will also be archived.
About FEI
FEI (Nasdaq: FEIC) is a leading diversified scientific instruments company. It is a premier provider of electron and ion-beam microscopes and tools for nanoscale applications globally and across many industries: industrial and academic materials research, life sciences, semiconductors, data storage, natural resources and more. With a history of over 60 years of technological innovation and leadership, FEI has set the performance standard in transmission electron microscopes (TEM), scanning electron microscopes (SEM) and DualBeams™, which combine a SEM with a focused ion beam (FIB). FEI’s imaging systems provide 3D characterization, analysis and modification/prototyping with resolutions down to the sub-Ångström (one-tenth of a nanometer) level. FEI has approximately 1,800 employees and sales and service operations in more than 50 countries around the world. More information can be found at: www.fei.com.
Safe Harbor Statement
This news release contains forward-looking statements that include our guidance for the first quarter of 2011 and future periods. Such forward-looking statements may be identified by words and phrases that refer to future expectations, such as “believe”, “guidance”, “expect”, “expects”, “are expected”, “will”, “estimate”, “assuming” and other similar words and phrases. Forward-looking statements in the release specifically relate to the expected shipment of our backlog; expectations for future bookings; expectations about foreign currency rates; expected tax rates; expectations for product sales and margins, and operating improvements. Factors that could affect these forward-looking statements include, but are not limited to, the global economic environment; lower than expected customer orders and potential weakness of the Research & Industry, Electronics and Life Sciences market segments; our ability to manufacture product at expected volumes; supply chain limitations; bankruptcy or insolvency of customers or suppliers; cyclical changes in the data storage and semiconductor industries, which are the major components of Electronics market revenue; fluctuations in foreign exchange, interest and tax rates; changes in tax rate and laws, accounting rules regarding taxes or agreements with tax authorities; the ongoing determination of the effectiveness of foreign exchange hedge transactions; reduced profitability due to failure to achieve or sustain margin improvement in service or product manufacturing; the relative mix of higher-margin and lower-margin products; failure to achieve expected cost reductions and other improvements from restructuring plans; risks associated with shipping a high percentage of the company’s quarterly revenue in the last
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month of the quarter; customer requests to defer planned shipments; increased competition and new product offerings from competitors; lower average sales prices and reduced margins on some product sales due to increased competition; failure of the company’s products and technology, including new products, to find acceptance with customers; inability to deploy products as expected or delays in shipping products due to technical problems or barriers; potential shipment or supply chain disruptions due to natural disasters or terrorist attacks; changes to or potential additional restructurings and reorganizations not presently anticipated; reduced sales due to geopolitical risks; changes in trade policies and tariff regulations; changes in the regulatory environment in the nations where we do business; additional selling, general and administrative or research and development expenses; reduced governmental spending due to budget constraints; additional costs related to future merger and acquisition activity; and failure of the company to achieve anticipated benefits of acquisitions and collaborations, including failure to achieve financial goals and integrate future acquisitions successfully. Please also refer to our Form 10-K, Forms 10-Q, Forms 8-K and other filings with the U.S. Securities and Exchange Commission for additional information on these factors and other factors that could cause actual results to differ materially from the forward-looking statements. FEI assumes no duty to update forward-looking statements.
###
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FEI Company and Subsidiaries
Consolidated Balance Sheets
(In thousands)
(Unaudited)
| December 31, 2010 |
October 3, 2010 |
December 31, 2009 |
||||||||||
| ASSETS |
||||||||||||
| CURRENT ASSETS: |
||||||||||||
| Cash and cash equivalents |
$ | 277,617 | $ | 241,013 | $ | 124,199 | ||||||
| Short-term investments in marketable securities |
44,026 | 38,341 | 212,119 | |||||||||
| Short-term restricted cash |
22,114 | 16,177 | 17,141 | |||||||||
| Receivables, net |
183,254 | 179,570 | 152,601 | |||||||||
| Inventories, net |
155,964 | 159,728 | 138,242 | |||||||||
| Deferred tax assets |
11,505 | 14,928 | 2,734 | |||||||||
| Other current assets |
23,126 | 40,055 | 39,470 | |||||||||
| Total current assets |
717,606 | 689,812 | 686,506 | |||||||||
| Non-current investments in marketable securities |
38,662 | 45,102 | 39,662 | |||||||||
| Long-term restricted cash |
41,377 | 41,863 | 35,901 | |||||||||
| Non-current inventories |
47,976 | 43,935 | 44,385 | |||||||||
| Property plant and equipment, net |
80,681 | 79,382 | 81,893 | |||||||||
| Goodwill |
44,800 | 44,816 | 44,615 | |||||||||
| Deferred tax assets |
1,072 | 8,392 | 3,369 | |||||||||
| Other assets, net |
12,248 | 13,189 | 17,638 | |||||||||
| TOTAL |
$ | 984,422 | $ | 966,491 | $ | 953,969 | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||||||
| CURRENT LIABILITIES: |
||||||||||||
| Accounts payable |
$ | 51,529 | $ | 50,779 | $ | 40,587 | ||||||
| Accrued liabilities |
51,209 | 42,778 | 36,434 | |||||||||
| Deferred revenue |
81,445 | 76,302 | 65,805 | |||||||||
| Income taxes payable |
3,715 | 5,349 | 1,321 | |||||||||
| Accrued restructuring, reorganization and relocation |
4,884 | 5,583 | 32 | |||||||||
| Short-term line of credit |
— | — | 59,600 | |||||||||
| Other current liabilities |
31,306 | 34,826 | 47,693 | |||||||||
| Total current liabilities |
224,088 | 215,617 | 251,472 | |||||||||
| Convertible debt |
89,012 | 89,012 | 100,000 | |||||||||
| Other liabilities |
38,148 | 41,670 | 34,973 | |||||||||
| SHAREHOLDERS’ EQUITY: |
||||||||||||
| Preferred stock - 500 shares authorized; none issued and outstanding |
— | — | — | |||||||||
| Common stock - 70,000 shares authorized; 38,280, 38,228, and 37,859 shares issued and outstanding at December 31, October 3, 2010, and December 31, 2009 |
509,145 | 508,081 | 485,557 | |||||||||
| Retained earnings |
75,024 | 53,680 | 21,476 | |||||||||
| Accumulated other comprehensive income |
49,005 | 58,431 | 60,491 | |||||||||
| Total shareholders’ equity |
633,174 | 620,192 | 567,524 | |||||||||
| TOTAL |
$ | 984,422 | $ | 966,491 | $ | 953,969 | ||||||
FEI Company and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
| Thirteen Weeks Ended | Year Ended | |||||||||||||||||||
| December 31, 2010 |
October 3, 2010 |
December 31, 2009 |
December 31, 2010 |
December 31, 2009 |
||||||||||||||||
| NET SALES: |
||||||||||||||||||||
| Products |
$ | 145,548 | $ | 113,424 | $ | 118,417 | $ | 479,780 | $ | 439,703 | ||||||||||
| Service and components |
40,522 | 39,581 | 36,032 | 154,442 | 137,641 | |||||||||||||||
| Total net sales |
186,070 | 153,005 | 154,449 | 634,222 | 577,344 | |||||||||||||||
| COST OF SALES: |
||||||||||||||||||||
| Products |
75,087 | 60,728 | 69,635 | 262,571 | 252,307 | |||||||||||||||
| Service and components |
27,261 | 25,748 | 25,544 | 102,387 | 95,533 | |||||||||||||||
| Total cost of sales |
102,348 | 86,476 | 95,179 | 364,958 | 347,840 | |||||||||||||||
| Gross profit |
83,722 | 66,529 | 59,270 | 269,264 | 229,504 | |||||||||||||||
| OPERATING EXPENSES: |
||||||||||||||||||||
| Research and development |
17,584 | 15,942 | 17,556 | 66,274 | 67,698 | |||||||||||||||
| Selling, general and administrative |
36,851 | 32,435 | 31,901 | 136,465 | 126,728 | |||||||||||||||
| Restructuring, reorganization and relocation |
562 | 536 | 826 | 11,067 | 3,456 | |||||||||||||||
| Total operating expenses |
54,997 | 48,913 | 50,283 | 213,806 | 197,882 | |||||||||||||||
| OPERATING INCOME |
28,725 | 17,616 | 8,987 | 55,458 | 31,622 | |||||||||||||||
| OTHER INCOME (EXPENSE): |
||||||||||||||||||||
| Interest income |
468 | 440 | 581 | 2,632 | 2,880 | |||||||||||||||
| Interest expense |
(958 | ) | (1,025 | ) | (1,143 | ) | (4,504 | ) | (5,441 | ) | ||||||||||
| Other, net |
(153 | ) | (472 | ) | (769 | ) | (1,364 | ) | (1,400 | ) | ||||||||||
| Total other (expense), net |
(643 | ) | (1,057 | ) | (1,331 | ) | (3,236 | ) | (3,961 | ) | ||||||||||
| INCOME BEFORE TAXES |
28,082 | 16,559 | 7,656 | 52,222 | 27,661 | |||||||||||||||
| INCOME TAX EXPENSE (BENEFIT) |
6,738 | 4,639 | 1,070 | (1,326 | ) | 5,017 | ||||||||||||||
| NET INCOME |
$ | 21,344 | $ | 11,920 | $ | 6,586 | $ | 53,548 | $ | 22,644 | ||||||||||
| BASIC NET INCOME PER SHARE DATA |
$ | 0.56 | $ | 0.31 | $ | 0.17 | $ | 1.41 | $ | 0.60 | ||||||||||
| DILUTED NET INCOME PER SHARE DATA |
$ | 0.52 | $ | 0.30 | $ | 0.17 | $ | 1.34 | $ | 0.60 | ||||||||||
| WEIGHTED AVERAGE SHARES OUTSTANDING: |
||||||||||||||||||||
| Basic |
38,209 | 38,186 | 37,767 | 38,083 | 37,537 | |||||||||||||||
| Diluted |
41,676 | 41,536 | 38,194 | 41,737 | 37,905 | |||||||||||||||
FEI Company and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
| Thirteen Weeks Ended (1) | Year Ended | |||||||||||||||||||
| December 31, 2010 |
October 3, 2010 |
December 31, 2009 |
December 31, 2010 |
December 31, 2009 |
||||||||||||||||
| NET SALES: |
||||||||||||||||||||
| Products |
78.2 | % | 74.1 | % | 76.7 | % | 75.6 | % | 76.2 | % | ||||||||||
| Service and components |
21.8 | % | 25.9 | % | 23.3 | % | 24.4 | % | 23.8 | % | ||||||||||
| Total net sales |
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||
| COST OF SALES: |
||||||||||||||||||||
| Products |
40.4 | % | 39.7 | % | 45.1 | % | 41.4 | % | 43.7 | % | ||||||||||
| Service and components |
14.7 | % | 16.8 | % | 16.5 | % | 16.1 | % | 16.5 | % | ||||||||||
| Total cost of sales |
55.0 | % | 56.5 | % | 61.6 | % | 57.5 | % | 60.2 | % | ||||||||||
| Gross profit |
45.0 | % | 43.5 | % | 38.4 | % | 42.5 | % | 39.8 | % | ||||||||||
| OPERATING EXPENSES: |
||||||||||||||||||||
| Research and development |
9.5 | % | 10.4 | % | 11.4 | % | 10.4 | % | 11.7 | % | ||||||||||
| Selling, general and administrative |
19.8 | % | 21.2 | % | 20.7 | % | 21.5 | % | 22.0 | % | ||||||||||
| Restructuring, reorganization and relocation |
0.3 | % | 0.4 | % | 0.5 | % | 1.7 | % | 0.6 | % | ||||||||||
| Total operating expenses |
29.6 | % | 32.0 | % | 32.6 | % | 33.7 | % | 34.3 | % | ||||||||||
| OPERATING INCOME |
15.4 | % | 11.5 | % | 5.8 | % | 8.7 | % | 5.5 | % | ||||||||||
| OTHER INCOME (EXPENSE): |
||||||||||||||||||||
| Interest income |
0.3 | % | 0.3 | % | 0.4 | % | 0.4 | % | 0.5 | % | ||||||||||
| Interest expense |
-0.5 | % | -0.7 | % | -0.7 | % | -0.7 | % | -0.9 | % | ||||||||||
| Other, net |
-0.1 | % | -0.3 | % | -0.5 | % | -0.2 | % | -0.2 | % | ||||||||||
| Total other (expense), net |
-0.3 | % | -0.7 | % | -0.9 | % | -0.5 | % | -0.7 | % | ||||||||||
| INCOME BEFORE TAXES |
15.1 | % | 10.8 | % | 5.0 | % | 8.2 | % | 4.8 | % | ||||||||||
| INCOME TAX EXPENSE (BENEFIT) |
3.6 | % | 3.0 | % | 0.7 | % | -0.2 | % | 0.9 | % | ||||||||||
| NET INCOME |
11.5 | % | 7.8 | % | 4.3 | % | 8.4 | % | 3.9 | % | ||||||||||
| (1) | Percentages may not add due to rounding. |
FEI COMPANY
Supplemental Data Table
($ in millions, except per share amounts)
(Unaudited)
| Q4
Ended 31-Dec-2010 |
Q3
Ended 3-Oct-2010 |
Q4
Ended 31-Dec-2009 |
YTD
Ended 31-Dec-2010 |
YTD
Ended 31-Dec-2009 |
||||||||||||||||
| Income Statement Highlights |
||||||||||||||||||||
| Consolidated sales |
$ | 186.1 | $ | 153.0 | $ | 154.4 | $ | 634.2 | $ | 577.3 | ||||||||||
| Gross margin |
45.0 | % | 43.5 | % | 38.4 | % | 42.5 | % | 39.8 | % | ||||||||||
| Stock compensation expense - TOTAL |
$ | 2.5 | $ | 2.5 | $ | 2.6 | $ | 10.5 | $ | 10.6 | ||||||||||
| Net income |
$ | 21.3 | $ | 11.9 | $ | 6.6 | $ | 53.5 | $ | 22.6 | ||||||||||
| Diluted net income per share |
$ | 0.52 | $ | 0.30 | $ | 0.17 | $ | 1.34 | $ | 0.60 | ||||||||||
| Interest income add back included in the calculation of diluted EPS |
$ | 0.5 | $ | 0.6 | $ | 0.0 | $ | 2.3 | $ | 0.0 | ||||||||||
| Sales Highlights |
||||||||||||||||||||
| Sales by Market Segment |
||||||||||||||||||||
| Electronics |
$ | 80.7 | $ | 44.0 | $ | 33.0 | $ | 222.8 | $ | 126.4 | ||||||||||
| Research & Industry |
$ | 47.3 | $ | 51.1 | $ | 56.3 | $ | 182.4 | $ | 231.5 | ||||||||||
| Life Sciences |
$ | 17.6 | $ | 18.3 | $ | 29.1 | $ | 74.6 | $ | 81.8 | ||||||||||
| Service and Components |
$ | 40.5 | $ | 39.6 | $ | 36.0 | $ | 154.4 | $ | 137.6 | ||||||||||
| Sales by Geography |
||||||||||||||||||||
| USA & Canada |
$ | 68.0 | $ | 43.7 | $ | 56.3 | $ | 204.0 | $ | 198.6 | ||||||||||
| Europe |
$ | 62.0 | $ | 54.1 | $ | 47.3 | $ | 207.4 | $ | 211.8 | ||||||||||
| Asia-Pacific and Rest of World |
$ | 56.1 | $ | 55.2 | $ | 50.8 | $ | 222.8 | $ | 166.9 | ||||||||||
| Gross Margin by Market Segment |
||||||||||||||||||||
| Electronics |
53.7 | % | 50.2 | % | 50.8 | % | 50.2 | % | 48.8 | % | ||||||||||
| Research & Industry |
42.3 | % | 43.3 | % | 41.6 | % | 41.0 | % | 42.0 | % | ||||||||||
| Life Sciences |
40.7 | % | 46.2 | % | 29.5 | % | 41.0 | % | 34.7 | % | ||||||||||
| Service and Components |
32.7 | % | 34.9 | % | 29.1 | % | 33.7 | % | 30.6 | % | ||||||||||
| Bookings and Backlog |
||||||||||||||||||||
| Total |
$ | 218.4 | $ | 190.1 | $ | 163.3 | $ | 751.5 | $ | 601.4 | ||||||||||
| Book-to-bill ratio |
1.17 | 1.24 | 1.06 | 1.18 | 1.04 | |||||||||||||||
| Backlog - total |
$ | 471.9 | $ | 439.6 | $ | 354.6 | $ | 471.9 | $ | 354.6 | ||||||||||
| Backlog - Service and Components |
$ | 81.3 | $ | 80.8 | $ | 68.0 | $ | 81.3 | $ | 68.0 | ||||||||||
| Bookings by Market Segment |
||||||||||||||||||||
| Electronics |
$ | 76.2 | $ | 59.6 | $ | 49.9 | $ | 263.8 | $ | 140.7 | ||||||||||
| Research & Industry |
$ | 77.6 | $ | 72.9 | $ | 58.2 | $ | 232.8 | $ | 235.4 | ||||||||||
| Life Sciences |
$ | 23.5 | $ | 18.4 | $ | 15.5 | $ | 87.1 | $ | 76.7 | ||||||||||
| Service and Components |
$ | 41.1 | $ | 39.2 | $ | 39.7 | $ | 167.8 | $ | 148.6 | ||||||||||
| Bookings by Geography |
||||||||||||||||||||
| USA & Canada |
$ | 80.9 | $ | 65.8 | $ | 45.6 | $ | 258.6 | $ | 203.3 | ||||||||||
| Europe |
$ | 59.5 | $ | 63.9 | $ | 63.0 | $ | 220.9 | $ | 229.7 | ||||||||||
| Asia-Pacific and Rest of World |
$ | 78.0 | $ | 60.4 | $ | 54.7 | $ | 272.0 | $ | 168.4 | ||||||||||
| Balance Sheet Highlights |
||||||||||||||||||||
| Cash, equivalents, investments, restricted cash |
$ | 423.8 | $ | 382.5 | $ | 429.0 | $ | 423.8 | $ | 429.0 | ||||||||||
| Operating cash generated (used) |
$ | 52.5 | ($ | 3.5 | ) | $ | 42.7 | $ | 75.0 | $ | 68.1 | |||||||||
| Accounts receivable |
$ | 183.3 | $ | 179.6 | $ | 152.6 | $ | 183.3 | $ | 152.6 | ||||||||||
| Days sales outstanding (DSO) |
90 | 107 | 90 | 90 | 90 | |||||||||||||||
| Inventory turnover |
2.6 | 2.4 | 2.6 | 2.6 | 2.6 | |||||||||||||||
| Fixed asset investment |
$ | 3.6 | $ | 0.9 | $ | 4.1 | $ | 8.9 | $ | 13.4 | ||||||||||
| Depreciation expense |
$ | 4.5 | $ | 4.3 | $ | 4.5 | $ | 17.4 | $ | 17.1 | ||||||||||
| Working capital |
$ | 493.5 | $ | 474.2 | $ | 435.0 | $ | 493.5 | $ | 435.0 | ||||||||||
| Headcount (permanent and temporary) |
1,813 | 1,810 | 1,781 | 1,813 | 1,781 | |||||||||||||||
| Euro average rate |
1.360 | 1.292 | 1.477 | 1.327 | 1.389 | |||||||||||||||
| Euro ending rate |
1.339 | 1.375 | 1.433 | 1.339 | 1.433 | |||||||||||||||