FSI International (ticker: FSII,
exchange: NASDAQ) News Release - 12/18/03
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FSI International, Inc. Announces First Quarter
Fiscal 2004 Financial Results
Orders for Surface Conditioning Products Nearly Double
from the Fiscal 2003 Fourth Quarter Level
MINNEAPOLIS (Dec. 18, 2003)--FSI International, Inc. (Nasdaq:
FSII), a manufacturer of capital equipment for the microelectronics
industry, today reported financial results for the fiscal 2004
first quarter ended November 29, 2003.
Financial Results
Sales for the fiscal 2004 first quarter were $22.5 million, compared
to $25.9 million for the same period of fiscal 2003 and $22.2
million in the prior quarter. The Company’s loss for the
first quarter of fiscal 2004 was $1.0 million or $0.03 per share
(diluted), compared to a net loss of $23.7 million or $0.80 per
share (diluted) for the fiscal 2003 first quarter and a net loss
of $1.8 million or $0.06 per share (diluted) in the prior quarter.
Industry Conditions Improving
Industry conditions continue to improve in parallel with strengthening
global economic conditions. The unit demand for semiconductor
devices in the quarter exceeded the prior 2000 peak. Factory utilization
rates for many semiconductor manufacturers are well above 90 percent.
At these levels, given the suppressed spending on new capacity
the past few years, it is anticipated that industry demand for
semiconductor equipment could increase 25 to 35 percent in calendar
2004, as compared to the forecasted calendar 2003 level.*
Non-Cash Charges
The Company did not record any significant non-cash charges in
the first quarter of fiscal 2004, but had significant non-cash
charges in the first quarter of fiscal 2003, including:
- A $2.8 million or $0.09 per share early termination
fee charge as the Company transitioned from Metron Technology
for distribution of its products in Europe and the Asia-Pacific
region to a direct model in these regions.
- A $10.2 million or $0.35 per share impairment
charge related to the Company’s investment in Metron Technology.
Cash Position
The Company used $1.3 million of cash for operating activities
during the first quarter of fiscal 2004. Also during the quarter,
the Company recorded $2.6 million in proceeds from the sale of
Metron Technology common stock, resulting in a $2.0 million gain
reported in other income.
“In anticipation of the continued improvement in industry
conditions in calendar 2004, an anticipated much stronger order
rate in the second quarter of fiscal 2004 as compared to the $18.8
million first quarter level and the expected placement of additional
MAGELLAN® immersion systems, we expect to use $4.0 to $5.0
million of cash for operating activities in the second quarter,”
stated Don Mitchell, FSI’s chairman and chief executive
officer.* “The cash will primarily be used to purchase inventory
required for the anticipated placement of additional MAGELLAN
immersion systems and an increase in accounts receivable.”*
“Over the past couple of months, we have experienced a
significant increase in the total order opportunity level. Therefore,
we expect second quarter orders to be between $26 and $28 million,
primarily for our Surface Conditioning products,” concluded
Mitchell.*
Balance Sheet
The Company continues to maintain a strong balance sheet with
approximately $132 million in assets, including $43.7 million
in cash, restricted cash, cash equivalents and marketable securities.
This includes $6.8 million of marketable securities associated
with the Company’s investment in Metron Technology. At the
end of the first quarter, the Company had a current ratio of 3.5
to 1.0, no debt and a book value of $3.64 per share.
Outlook
Based on the backlog and deferred revenue levels at the end of
the first quarter, the Company expects second quarter fiscal 2004
revenues of $20 to $23 million.* Based upon the anticipated gross
profit margins and the operating expense run rate, the Company
expects a loss in the $4.5 to $5.5 million range for the second
quarter.*
Conference Call Details
Investors will have the opportunity to listen to the conference
call at 3:30 p.m. CT today over the Internet. The web cast is
being distributed over CCBN’s Investor Distribution Network
to both institutional and individual investors. Individual investors
can listen to the call through CCBN’s individual investor
center at www.companyboardroom.com or by visiting any of the investor
sites in CCBN’s Individual Investor Network such as America
Online’s Personal Finance Channel, Fidelity Investments®
(Fidelity.com) and others. Institutional investors can access
the call via CCBN’s password-protected event management
site, StreetEvents (www.streetevents.com). For those who cannot
listen to the live broadcast, a replay will be available shortly
after the call.
About FSI
FSI International, Inc. is a global supplier
of surface conditioning equipment technology and support services
for microelectronics manufacturing. Using the Company’s
broad portfolio of cleaning products, which include batch and
single-wafer platforms for immersion, spray, vapor and CryoKinetic
technologies, customers are able to achieve their process performance,
flexibility and productivity goals.
The Company’s support services programs provide product
and process enhancements to extend the life of installed FSI equipment
enabling worldwide customers to realize a higher return on their
capital investment.
FSI maintains a web site at http://www.fsi-intl.com.
“Safe Harbor” Statement Under the Private
Securities Litigation Reform Act of 1995
This press release contains certain “forward-looking”
statements (*), including, but not limited to, the increased industry
demand for semiconductor equipment, expected orders, expected
revenues, net losses and cash burn rate for the second quarter
of fiscal 2004. Except for the historical information contained
herein, the matters discussed in this news release are forward-looking
statements involving risks and uncertainties, both known and unknown,
that could cause actual results to differ materially from those
in such forward-looking statements. Such risks and uncertainties
include, but are not limited to, the length and extent of the
current industry recovery; order delays or cancellations; general
economic conditions; changes in customer capacity requirements
and demand for microelectronics; the extent of demand for the
Company’s products and its ability to meet demand; global
trade policies; worldwide economic and political stability; the
Company’s successful execution of internal performance plans;
the cyclical nature of the Company’s business; volatility
of the market for certain products; performance issues with key
suppliers and subcontractors; the transition to 300mm products;
the level of new orders; the timing and success of current and
future product and process development programs; the success of
the Company’s affiliated distributor; the success of the
Company’s direct distribution organization; legal proceedings;
and the potential impairment of long-lived assets; as well as
other factors listed from time to time in the Company’s
SEC reports including, but not limited to, the Company’s
Annual Report on Form 10-K for the 2003 fiscal year. The Company
assumes no duty to update the information in this press release.
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