Attached files
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| 8-K - FORM 8-K - ENTEGRIS INC | d294896d8k.htm |
Exhibit 99.1
Entegris Reports Record Year in Sales, Earnings, and Cash Flow
The Company Reports Fourth-Quarter Sales of $164 million and Non-GAAP EPS of $0.16; Fourth-Quarter Cash From Operations was $45 Million
BILLERICA, Mass., February 1, 2012 – Entegris, Inc. (Nasdaq: ENTG) today reported its financial results for the Company’s fourth quarter and fiscal year ended December 31, 2011.
The Company recorded fourth-quarter sales of $163.9 million, a decline of 10 percent from the prior year, and 5 percent sequentially. Net income was $40.8 million, or $0.30 per share. These results included amortization of intangible assets of $2.5 million and a one-time income tax benefit of $21.0 million. Non-GAAP earnings per share of $0.16 in the fourth quarter of 2011 compared to $0.23 in the fourth quarter a year ago and $0.17 in the third quarter of 2011. A reconciliation table of GAAP to non-GAAP earnings per share is contained in this press release.
Fiscal 2011 sales were $749.3 million, representing a 9 percent increase compared to sales of $688.4 million in 2010. Net income per share of $0.91 compared to net income of $0.63 per share a year earlier. On a non-GAAP basis, net income per share in fiscal 2011 was $0.80 compared with net income per share of $0.71 for the year earlier.
Gideon Argov, president and chief executive officer, said: “We are pleased to report our second consecutive record year in terms of revenue, earnings, and operating cash flow. We executed well operationally and achieved market share gains in several key markets. Given our strategic initiatives to address the most challenging contamination control needs in the semiconductor and adjacent high-technology industries, we are excited about the growth opportunities ahead.”
“While production levels for much of the semiconductor industry remained flat in the fourth quarter, we are seeing strength in technology-driven demand for some of our latest generation products geared toward leading-edge semiconductor processes,” Argov said.
For the fiscal first quarter ending March 31, 2012, the Company expects sales to be flat to up 5 percent and non-GAAP EPS to range from $0.11 to $0.13.
Fourth-Quarter Results Conference Call Details
Entegris will hold a conference call to discuss its results for the fourth quarter on Wednesday, February 1, 2012, at 10:00 a.m. Eastern Time. Participants should dial 1-719-325-2289 or 1-888-617-5714, referencing confirmation code 3513471. Participants are asked to dial in 8 to 13 minutes prior to the start of the call. A replay of the call will be available starting at 1:00 p.m. ET on February 1 until March 16, 2012. The replay can be accessed by using passcode 3513471 after dialing 1-719-457-0820 or 1-888-203-1112. A live and on-demand webcast of the call can also be accessed from the investor relations section of Entegris’ website at www.entegris.com.
ABOUT ENTEGRIS
Entegris is a leading provider of a wide range of products for purifying, protecting and transporting critical materials used in processing and manufacturing in the semiconductor and other high-technology industries. Entegris is ISO 9001 certified and has manufacturing, customer service and/or research facilities in the United States, China, France, Germany, Israel, Japan, Malaysia, Singapore, South Korea and Taiwan. Additional information can be found at www.entegris.com.
NON-GAAP INFORMATION
The Company’s consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (GAAP). Adjusted EBITDA and Adjusted Operating Income together with related measures thereof, and non-GAAP EPS, are considered “Non-GAAP financial measures” under the rules and regulations of the SEC. These financial measures are provided as a complement to financial measures provided in accordance with GAAP. We provide non-GAAP financial measures in order to better assess and reflect operating performance. Management believes the non-GAAP measures help indicate our baseline performance before certain gains, losses or other charges that may not be indicative of our business or future outlook. We believe these non-GAAP measures will aid investors’ overall understanding of our results by providing a higher degree of transparency for certain expenses and providing a level of disclosure that will help investors understand how we plan and measure our business. The presentation of non-GAAP measures is not meant to be considered in isolation, as a substitute for, or superior to, financial measures or information provided in accordance with GAAP. The calculations of Adjusted EBITDA margin, Adjusted Operating Income, and non-GAAP EPS are included elsewhere in this release.
Forward-Looking Statements
Certain information contained in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current management expectations only as of the date of this press release, and involve substantial risks and uncertainties that could cause actual results to differ materially from the results expressed in, or implied by, these forward-looking statements. Statements that include such words as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “may,” “will,” “should” or the negative thereof and similar expressions as they relate to Entegris or our management are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. These risks include, but are not limited to, fluctuations in the market price of Entegris’ stock, Entegris’ future operating results, other acquisition and investment opportunities available to Entegris, general business and market conditions and other factors. Additional information concerning these and other risk factors may be found in previous financial press releases issued by Entegris and Entegris’ periodic public filings with the Securities and Exchange Commission, including discussions appearing under the headings “Risks Relating to our Business and Industry,” “Risks Related to our Borrowings”, “Manufacturing Risks,” “International Risks,” and “Risks Related to Owning Our Securities” in Item 1A of our Annual Report on Form 10–K for the fiscal year ended December 31, 2010, as well as other matters and important factors disclosed previously and from time to time in the filings of Entegris with the U.S. Securities and Exchange Commission. Except as required under the federal securities laws and the rules and regulations of the Securities and Exchange Commission, we undertake no obligation to update publicly any forward-looking statements contained herein.
Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
| Three Months Ended | ||||||||||||
| December 31, 2011 |
October 1, 2011 |
December 31, 2010 |
||||||||||
| Net sales |
$ | 163,922 | $ | 173,014 | $ | 182,100 | ||||||
| Cost of sales |
96,308 | 98,186 | 101,591 | |||||||||
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| Gross profit |
67,614 | 74,828 | 80,509 | |||||||||
| Selling, general and administrative expenses |
32,398 | 33,533 | 38,199 | |||||||||
| Engineering, research and development expenses |
11,029 | 11,957 | 10,997 | |||||||||
| Amortization of intangible assets |
2,462 | 2,505 | 2,772 | |||||||||
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| Operating income |
21,725 | 26,833 | 28,541 | |||||||||
| Interest expense (income), net |
9 | (38 | ) | 306 | ||||||||
| Other (income) expense, net |
(102 | ) | 315 | (271 | ) | |||||||
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| Income before income taxes and equity in affiliates |
21,818 | 26,556 | 28,506 | |||||||||
| Income tax (benefit) expense |
(18,933 | ) | 4,582 | (196 | ) | |||||||
| Equity in net (income) loss of affiliates |
(10 | ) | (14 | ) | 1,838 | |||||||
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| Net income |
40,761 | 21,988 | 26,864 | |||||||||
| Net loss attributable to noncontrolling interest |
— | — | (139 | ) | ||||||||
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| Net income attributable to Entegris, Inc. |
$ | 40,761 | $ | 21,988 | $ | 27,003 | ||||||
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| Amounts attributable to Entegris, Inc.: |
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| Basic net income per common share: |
$ | 0.30 | $ | 0.16 | $ | 0.20 | ||||||
| Diluted net income per common share: |
$ | 0.30 | $ | 0.16 | $ | 0.20 | ||||||
| Weighted average shares outstanding: |
||||||||||||
| Basic |
135,509 | 134,995 | 132,314 | |||||||||
| Diluted |
137,032 | 136,305 | 133,971 | |||||||||
Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
| Twelve months ended | ||||||||
| December 31, 2011 |
December 31, 2010 |
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| Net sales |
$ | 749,259 | $ | 688,416 | ||||
| Cost of sales |
423,329 | 377,773 | ||||||
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| Gross profit |
325,930 | 310,643 | ||||||
| Selling, general and administrative expenses |
140,847 | 147,051 | ||||||
| Engineering, research and development expenses |
47,980 | 43,934 | ||||||
| Amortization of intangible assets |
10,225 | 13,231 | ||||||
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| Operating income |
126,878 | 106,427 | ||||||
| Interest expense, net |
659 | 3,516 | ||||||
| Other (income) expense, net |
(1,745 | ) | 1,430 | |||||
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| Income before income taxes |
127,964 | 101,481 | ||||||
| Income tax expense |
3,617 | 15,006 | ||||||
| Equity in net (income) loss of affiliates |
(499 | ) | 1,353 | |||||
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| Net income |
124,846 | 85,122 | ||||||
| Net income attributable to noncontrolling interest |
400 | 766 | ||||||
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| Net income attributable to Entegris, Inc. |
$ | 124,446 | $ | 84,356 | ||||
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| Amounts attributable to Entegris, Inc.: |
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| Basic net income per common share: |
$ | 0.92 | $ | 0.64 | ||||
| Diluted net income per common share: |
$ | 0.91 | $ | 0.63 | ||||
| Weighted average shares outstanding: |
||||||||
| Basic |
134,685 | 131,685 | ||||||
| Diluted |
136,223 | 133,174 | ||||||
Entegris, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
| December 31, 2011 | December 31, 2010 | |||||||
| ASSETS |
||||||||
| Cash and cash equivalents |
$ | 273,593 | $ | 133,954 | ||||
| Accounts receivable, net |
107,223 | 124,732 | ||||||
| Inventories |
93,937 | 101,043 | ||||||
| Deferred tax assets, deferred tax charges and refundable income taxes |
15,805 | 11,484 | ||||||
| Other current assets and assets held for sale |
12,441 | 15,878 | ||||||
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| Total current assets |
502,999 | 387,091 | ||||||
| Property, plant and equipment, net |
130,554 | 126,725 | ||||||
| Intangible assets |
56,453 | 65,087 | ||||||
| Deferred tax assets – non-current |
25,119 | 10,855 | ||||||
| Other assets |
9,538 | 11,627 | ||||||
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| Total assets |
$ | 724,663 | $ | 601,385 | ||||
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| LIABILITIES AND EQUITY |
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| Accounts payable |
$ | 30,609 | $ | 34,631 | ||||
| Accrued liabilities |
47,841 | 59,503 | ||||||
| Income tax payable and deferred tax liabilities |
13,544 | 13,500 | ||||||
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| Total current liabilities |
91,994 | 107,634 | ||||||
| Other liabilities |
23,831 | 29,738 | ||||||
| Equity |
608,838 | 464,013 | ||||||
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| Total liabilities and equity |
$ | 724,663 | $ | 601,385 | ||||
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Entegris, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2011 |
December 31, 2010 |
December 31, 2011 |
December 31, 2010 |
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| Operating activities: |
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| Net income |
$ | 40,761 | $ | 26,864 | $ | 124,846 | $ | 85,122 | ||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||||||
| Depreciation |
6,547 | 7,322 | 26,839 | 27,967 | ||||||||||||
| Amortization |
2,462 | 2,772 | 10,225 | 13,231 | ||||||||||||
| Stock-based compensation expense |
1,735 | 2,154 | 7,519 | 7,588 | ||||||||||||
| Deferred tax valuation allowance and other tax items |
(19,254 | ) | (5,017 | ) | (19,367 | ) | (2,953 | ) | ||||||||
| Other |
978 | 2,881 | 541 | 2,676 | ||||||||||||
| Changes in operating assets and liabilities: |
||||||||||||||||
| Trade accounts and notes receivable |
3,652 | 971 | 19,336 | (26,789 | ) | |||||||||||
| Inventories |
7,836 | (3,056 | ) | 3,632 | (14,285 | ) | ||||||||||
| Accounts payable and accrued liabilities |
(289 | ) | 2,509 | (15,127 | ) | 34,860 | ||||||||||
| Income taxes payable and refundable income taxes |
(182 | ) | 4,813 | (1,033 | ) | 13,243 | ||||||||||
| Other |
270 | (2,229 | ) | (125 | ) | 238 | ||||||||||
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| Net cash provided by operating activities |
44,516 | 39,984 | 157,286 | 140,898 | ||||||||||||
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| Investing activities: |
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| Acquisition of property and equipment |
(6,121 | ) | (4,635 | ) | (30,267 | ) | (16,794 | ) | ||||||||
| Other |
2,440 | 317 | 1,836 | 4,809 | ||||||||||||
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| Net cash used in investing activities |
(3,681 | ) | (4,318 | ) | (28,431 | ) | (11,985 | ) | ||||||||
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| Financing activities: |
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| Payments on short-term borrowings and long-term debt |
— | (6,203 | ) | — | (259,157 | ) | ||||||||||
| Proceeds from short-term and long-term borrowings |
— | — | — | 186,649 | ||||||||||||
| Issuance of common stock |
6,034 | 5,136 | 11,690 | 6,799 | ||||||||||||
| Other |
259 | 85 | (826 | ) | — | |||||||||||
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| Net cash provided by (used in) financing activities |
6,293 | (982 | ) | 10,864 | (65,709 | ) | ||||||||||
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| Effect of exchange rate changes on cash |
(572 | ) | 456 | (80 | ) | 2,050 | ||||||||||
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| Increase in cash and cash equivalents |
46,556 | 35,140 | 139,639 | 65,254 | ||||||||||||
| Cash and cash equivalents at beginning of period |
227,037 | 98,814 | 133,954 | 68,700 | ||||||||||||
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| Cash and cash equivalents at end of period |
$ | 273,593 | $ | 133,954 | $ | 273,593 | $ | 133,954 | ||||||||
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Entegris, Inc. and Subsidiaries
Segment Information
(In thousands)
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| Net sales |
December 31, 2011 |
October 1, 2011 |
December 31, 2010 |
December 31, 2011 |
December 31, 2010 |
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| Contamination Control Solutions |
$ | 105,062 | $ | 110,015 | $ | 118,106 | $ | 483,958 | $ | 435,858 | ||||||||||
| Microenvironments |
40,116 | 42,738 | 45,772 | 182,150 | 182,485 | |||||||||||||||
| Specialty Materials |
18,744 | 20,261 | 18,222 | 83,151 | 70,073 | |||||||||||||||
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| Total net sales |
$ | 163,922 | $ | 173,014 | $ | 182,100 | $ | 749,259 | $ | 688,416 | ||||||||||
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| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| Segment profit |
December 31, 2011 |
October 1, 2011 |
December 31, 2010 |
December 31, 2011 |
December 31, 2010 |
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| Contamination Control Solutions |
$ | 26,082 | $ | 29,522 | $ | 34,609 | $ | 140,313 | $ | 122,891 | ||||||||||
| Microenvironments |
6,201 | 6,790 | 7,602 | 29,959 | 38,930 | |||||||||||||||
| Specialty Materials |
4,340 | 4,675 | 2,847 | 18,255 | 11,080 | |||||||||||||||
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| Total segment profit |
36,623 | 40,987 | 45,058 | 188,527 | 172,901 | |||||||||||||||
| Amortization of intangibles |
(2,462 | ) | (2,505 | ) | (2,772 | ) | (10,225 | ) | (13,231 | ) | ||||||||||
| Unallocated expenses |
(12,436 | ) | (11,649 | ) | (13,745 | ) | (51,424 | ) | (53,243 | ) | ||||||||||
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| Total operating income |
$ | 21,725 | $ | 26,833 | $ | 28,541 | $ | 126,878 | $ | 106,427 | ||||||||||
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Entegris, Inc. and Subsidiaries
Reconciliation of GAAP to Adjusted Operating Income and Adjusted EBITDA
(In thousands)
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| December 31, 2011 |
October 1, 2011 |
December 31, 2010 |
December 31, 2011 |
December 31, 2010 |
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| Net sales |
$ | 163,922 | $ | 173,014 | $ | 182,100 | $ | 749,259 | $ | 688,416 | ||||||||||
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| Net income attributable to Entegris, Inc. |
$ | 40,761 | $ | 21,988 | $ | 27,003 | $ | 124,446 | $ | 84,356 | ||||||||||
| Adjustments to net income attributable to Entegris, Inc. |
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| Net (loss) income attributable to noncontrolling interest |
— | — | (139 | ) | 400 | 766 | ||||||||||||||
| Equity in net (income) loss of affiliates |
(10 | ) | (14 | ) | 1,838 | (499 | ) | 1,353 | ||||||||||||
| Income tax (benefit) expense |
(18,933 | ) | 4,582 | (196 | ) | 3,617 | 15,006 | |||||||||||||
| Other (income) expense, net |
(102 | ) | 315 | (271 | ) | (1,745 | ) | 1,430 | ||||||||||||
| Interest expense (income), net |
9 | (38 | ) | 306 | 659 | 3,516 | ||||||||||||||
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| GAAP – Operating income |
21,725 | 26,833 | 28,541 | 126,878 | 106,427 | |||||||||||||||
| Amortization of intangible assets |
2,462 | 2,505 | 2,772 | 10,225 | 13,231 | |||||||||||||||
| Gain associated with pension curtailment |
— | (726 | ) | — | (726 | ) | — | |||||||||||||
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| Adjusted operating income |
24,187 | 28,612 | 31,313 | 136,377 | 119,658 | |||||||||||||||
| Depreciation |
6,547 | 6,763 | 7,322 | 26,839 | 27,967 | |||||||||||||||
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| Adjusted EBITDA |
$ | 30,734 | $ | 35,375 | $ | 38,635 | $ | 163,216 | $ | 147,625 | ||||||||||
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| Adjusted operating margin |
14.8 | % | 16.5 | % | 17.2 | % | 18.2 | % | 17.4 | % | ||||||||||
| Adjusted EBITDA – as a % of net sales |
18.7 | % | 20.4 | % | 21.2 | % | 21.8 | % | 21.4 | % | ||||||||||
Entegris, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Earnings per Share
(In thousands)
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| December 31, 2011 |
October 1, 2011 |
December 31, 2010 |
December 31, 2011 |
December 31, 2010 |
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| GAAP net income attributable to Entegris, Inc. |
$ | 40,761 | $ | 21,988 | $ | 27,003 | $ | 124,446 | $ | 84,356 | ||||||||||
| Adjustments to net income attributable to Entegris, Inc.: |
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| Amortization of intangible assets |
2,462 | 2,505 | 2,772 | 10,225 | 13,231 | |||||||||||||||
| Accelerated write-off of debt costs |
— | — | — | 282 | 890 | |||||||||||||||
| Gain on sale of equity investment |
— | — | — | (1,523 | ) | (892 | ) | |||||||||||||
| Gain associated with pension curtailment |
— | (726 | ) | — | (726 | ) | — | |||||||||||||
| Reversal of deferred tax valuation allowance (1) |
(20,999 | ) | — | — | (20,999 | ) | — | |||||||||||||
| Impairment of equity investment |
— | — | 2,164 | — | 2,164 | |||||||||||||||
| Tax effect of adjustments to net income attributable to Entegris, Inc. |
(863 | ) | (458 | ) | (1,022 | ) | (3,355 | ) | (4,871 | ) | ||||||||||
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| Non-GAAP net income attributable to Entegris, Inc. |
$ | 21,361 | $ | 23,309 | $ | 30,917 | $ | 108,350 | $ | 94,878 | ||||||||||
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| Diluted earnings per common share attributable to Entegris, Inc.: |
$ | 0.30 | $ | 0.16 | $ | 0.20 | $ | 0.91 | $ | 0.63 | ||||||||||
| Effect of adjustments to net income attributable to Entegris, Inc. |
$ | 0.14 | $ | 0.01 | $ | 0.03 | $ | 0.12 | $ | 0.08 | ||||||||||
| Diluted non-GAAP earnings per common share attributable to Entegris, Inc.: |
$ | 0.16 | $ | 0.17 | $ | 0.23 | $ | 0.80 | $ | 0.71 | ||||||||||
| (1) | This amount represents the reversal of the remaining valuation allowance on certain of the Company’s deferred tax assets. The amount excludes the reversal of the valuation allowance on those deferred tax assets realized in 2011 and 2010 based on earnings in those years. |
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