Ade (NASDAQ:ADEX)
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ADE Corporation (NasdaqGM: ADEX) today reported
financial results for its fourth quarter and fiscal year ended April
30, 2006.
Revenue for the fourth quarter of fiscal 2006 was $29.3 million
compared with $26.3 million for the third quarter of fiscal 2006 and
$29.8 million for the fourth quarter of fiscal 2005. ADE posted net
income of $4.7 million, or $0.32 per diluted share, for the fourth
quarter of fiscal 2006. This compares with net income of $4.7 million,
or $0.32 per diluted share in the third quarter of fiscal 2006. This
figure includes a tax benefit of approximately $980,000 related to
2005 tax deductions. ADE reported net income of $23.1 million, or
$1.60 per diluted share, for the fourth quarter of fiscal 2005. Fourth
quarter fiscal 2005 results included a $17.2 million non-cash income
tax valuation allowance reversal.
Gross margin for the fourth fiscal quarter of 2006 was 54 percent.
This compares with 57 percent for the prior quarter and 55 percent for
the year-ago fourth fiscal quarter. ADE ended the year with $91.6
million in cash, cash equivalents and marketable securities. This is
an increase of 24 percent from $73.7 million at the end of fiscal
2005.
Revenue for full-year fiscal 2006 was $103.4 million compared with
$116.9 million for fiscal 2005. Fiscal 2006 net income was $15.3
million, or $ 1.04 per diluted share, compared with net income of
$40.9 million, or $2.86 per diluted share, for fiscal 2005. Excluding
the income tax valuation allowance reversal, ADE generated fiscal 2005
non-GAAP profits of $23.7 million or $1.66 per diluted share.
Backlog at April 30, 2006 was $ 53.1 million, a sequential
increase of 27% compared with the $41.8 million reported at the end of
the third fiscal quarter and an increase from $45.0 million on April
30, 2005.
Also, as previously announced, during the fourth fiscal quarter of
2006, ADE entered into a definitive merger agreement with KLA-Tencor
Corporation (NasdaqGS: KLAC), which was amended and restated in May
2006. Under this agreement, KLA-Tencor would acquire ADE for cash
consideration of $32.50 per share. On July 13, 2006, ADE shareholders
approved the proposed merger. A closing date will be established once
the parties have cleared or waived all conditions to close, including
regulatory clearance from the German antitrust authorities who, as
previously reported, notified KLA-Tencor on July 10, 2006 of the
commencement of a Phase II investigation of the proposed merger. Both
ADE and KLA-Tencor continue to be confident that the acquisition will
be completed once German antitrust clearance is obtained.
Non-GAAP Financial Results
In an effort to provide investors with additional information
regarding the Company's results, this news release presents certain
figures that exclude the impact of the Company's reversal of deferred
tax asset valuation allowances in the fourth quarter of fiscal 2005.
The figures may be deemed to be "non-GAAP financial measures." ADE's
non-GAAP financial measures are a supplement to financial statements
prepared based on generally accepted accounting principles ("GAAP").
The Company believes this presentation provides investors and ADE
management with additional useful insights into its underlying results
because of the materiality of the reversal of its deferred tax asset
valuation allowances on its fourth-quarter and full-year fiscal 2005
net income. Management believes that presenting results that exclude
the impact of this reversal facilitates period-to-period comparisons
of the Company's growth on a more consistent basis that better
reflects actual trends. A reconciliation of the non-GAAP financial
measures to the most directly comparable GAAP financial results is
included in the table titled "Non-GAAP to GAAP Reconciliation" in this
news release. These non-GAAP financial measures should not be
considered in isolation from the comparable GAAP measures nor
considered a substitute therefor.
About ADE Corporation
ADE Corporation is a leading supplier of metrology and inspection
systems for the semiconductor wafer, semiconductor device, magnetic
data storage and optics manufacturing industries. Wafer suppliers and
device manufacturers worldwide rely on ADE measurement and inspection
systems to certify and ensure the highest quality bare silicon
substrates. ADE's most recent generation of products serve both 65nm
in-line manufacturing applications and 45nm process development.
Semiconductor device yields begin with the bare wafer, and ADE's
leading technology provides early insight into surface defect, shape,
flatness and nanotopography of these advanced 300mm substrates.
Additional information about ADE is available on the Internet at
http://www.ade.com, which website is not part of this press release.
Cautionary Statement Regarding Forward-Looking Statements
This news release contains certain forward-looking statements
within the meaning of the "safe harbor" provisions of the United
States Private Securities Litigation Reform Act of 1995 and federal
securities law. Such forward-looking statements are subject to known
and unknown risks and uncertainties that could cause actual results to
differ materially from those expressed or implied by such statements.
Those statements that make reference to expectations, predictions,
beliefs, and assumptions should be considered forward-looking
statements. These statements include, but are not limited to, those
associated with the proposed merger with KLA-Tencor, including the
expected closing time for the proposed merger and the obtaining of
clearance from German antitrust authorities. These statements involve
risks and uncertainties including those associated with delays in
obtaining, or adverse conditions contained in, the German antitrust
authorities' regulatory approvals; failure to consummate or delay in
consummating the proposed merger for other reasons, changes in laws or
regulations and other similar factors. Further information on
potential factors that could affect ADE's business is contained in its
reports on file with the Securities and Exchange Commission, including
its Form 10-K for the year ended April 30, 2005. ADE is under no
obligation to (and expressly disclaims any such obligation to) update
or alter its forward-looking statements whether as a result of new
information, future events or otherwise.
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ADE CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share amounts)
Three months Twelve months
ended ended
April 30 April 30
----------------- -------------------
2006 2005 2006 2005
-------- -------- --------- ---------
Revenue $29,264 $29,794 $103,448 $116,901
Cost of revenue 13,338 13,390 45,820 54,294
-------- -------- --------- ---------
Gross profit 15,926 16,404 57,628 62,607
-------- -------- --------- ---------
Operating expenses:
Research and development 4,072 4,106 15,815 15,519
Marketing and sales 4,227 4,045 13,610 13,044
General and administrative 3,141 2,464 11,076 10,404
-------- -------- --------- ---------
Total operating expenses 11,440 10,615 40,501 38,967
-------- -------- --------- ---------
Income from operations 4,486 5,789 17,127 23,640
Gain on sale of marketable
securities 915 - 915 -
Interest and other income, net 832 279 2,555 668
-------- -------- --------- ---------
Income before provision for
(benefit from) income taxes 6,233 6,068 20,597 24,308
Provision for (benefit from)
income taxes 1,510 (17,077) 5,340 (16,633)
-------- -------- --------- ---------
Net income $4,723 $23,145 $15,257 $40,941
======== ======== ========= =========
Basic earnings per share $0.33 $1.63 $1.06 $2.91
Diluted earnings per share $0.32 $1.60 $1.04 $2.86
Weighted average shares
outstanding - basic 14,475 14,166 14,393 14,069
Weighted average shares
outstanding - diluted 14,822 14,436 14,686 14,312
ADE CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)
April 30, April 30,
2006 2005
Assets
Cash and cash equivalents $91,573 $72,841
Marketable securities - 836
Accounts receivable, net 23,164 18,499
Inventories 35,855 30,764
Other current assets 1,701 1,373
Deferred income taxes 9,311 10,601
--------- ---------
Total current assets 161,604 134,914
Fixed assets, net 8,946 9,241
Deferred income taxes 4,742 6,616
Investments 499 499
Other assets 1,671 1,956
--------- ---------
Total assets $177,462 $153,226
========= =========
Liabilities and Stockholders' Equity
Total current liabilities $22,718 $18,273
Deferred gain on sale-leaseback 1,383 1,496
Long-term debt 3,244 3,431
Total stockholders' equity 150,117 130,026
--------- ---------
Total liabilities and stockholders' equity $177,462 $153,226
========= =========
ADE CORPORATION
NON-GAAP to GAAP RECONCILIATION
(In thousands, except per share amounts)
Three months Twelve months
ended ended
April 30 April 30
---------------- -----------------
2006 2005 2006 2005
------- -------- -------- --------
Net income - GAAP $4,723 $23,145 $15,257 $40,941
Less:
Reversal of income tax valuation
allowance - (17,217) - (17,217)
------- -------- -------- --------
Net income - non-GAAP $4,723 $5,928 $15,257 $23,724
======= ======== ======== ========
Diluted earnings per share - GAAP $0.32 $1.60 $1.04 $2.86
Less:
Reversal of income tax valuation
allowance - (1.19) - (1.20)
------- -------- -------- --------
Diluted earnings per share - non-
GAAP $0.32 $0.41 $1.04 $1.66
======= ======== ======== ========
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