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Fei Company
NASDAQ FEIC 90,82 US$ 13,82%
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FEI Reports Third Quarter 2015 Results

Publié le 27 octobre 2015

HILLSBORO, Ore., Oct. 27, 2015 (GLOBE NEWSWIRE) -- FEI Company (FEIC) today reported results for the third quarter of 2015. Third quarter revenue of $213 million was down 6.7% compared to $228 million for third quarter of 2014. Movements in foreign exchange rates negatively impacted revenue for the third quarter of 2015 by approximately $10 million, as compared with third quarter of 2014 rates. Excluding the impact of foreign exchange movements, third quarter organic revenue was down 2.4% compared with the third quarter of 2014.

Diluted earnings per share were $0.25, compared with $0.51 in the third quarter of 2014. Net income for the quarter was $10 million compared with $22 million in the third quarter of 2014. Included in third quarter 2015 results are tax benefits in the amount of $6.1 million, or $0.15 per share, and a non-cash impairment of goodwill and long-lived assets of $24 million, or $0.58 per share, net of taxes. The impairment is related to assets supporting the company’s oil and gas business.

The company’s backlog of orders at the end of the third quarter of 2015 was $562 million, compared with $539 million at the end of the third quarter of 2014 and $541 million at the end of the second quarter of 2015. Bookings for the third quarter of 2015 were $234 million, resulting in a book-to-bill of 1.10-to-1.

“While Science met our expectations, activity at our large semiconductor customers fell short of our forecast in the third quarter,” commented Don Kania, president and CEO. “Near term spending at our semiconductor customers is being impacted as the industry transitions to 10nm devices.

“We saw increased activity in our Science business during the third quarter and expect a strong finish to the year from this group.  We remain focused on investing to drive our technology leadership and ensuring we are well positioned for the significant long term growth opportunities we see in our Science and Industrial markets.”

Net cash provided by operating activities for the third quarter of 2015 was $46 million, compared with $28 million in the third quarter of 2014. During the quarter, the company paid cash dividends of $12 million, invested $2.2 million on plant and equipment and repurchased 545,000 shares of its common stock at an average price of $77.41. Total cash, investments and restricted cash at the end of the quarter was $500 million.

Outlook

For the fourth quarter of 2015, the company currently expects reported revenue to be in the range of $260 million to $275 million. This range reflects the expected negative impact of a stronger U.S. dollar of approximately 4.0% as compared to the fourth quarter of 2014. Earnings per fully diluted share are expected to be in the range of $1.05 to $1.20. This range is based on an expected tax rate for the fourth quarter of approximately 20%.

For full year 2015, the company expects organic revenue growth to be in the range of 1.0% to 2.5%, compared with 2014, and earnings per fully diluted share in the range of $2.85 to $3.00. This range includes the impairment expense and tax benefits the company recorded in the third quarter of 2015. Based on current exchange rates, the stronger U.S. dollar is expected to negatively impact full year 2015 reported revenue growth by approximately 5% as compared to the full year 2014.

Investor Conference Call - 2:00 p.m. Pacific Time, Tuesday, October 27, 2015

Parties interested in listening to FEI's quarterly conference call may do so by dialing 1-877-407-8293 (U.S., toll-free) or +1-201-689-8349 (international and toll), with the conference title: FEI Third Quarter Earnings Conference Call. The call can also be accessed via the web by going to FEI's Investor Relations page at http://investor.fei.com/event, where the webcast will also be archived.

Safe Harbor Statement

This news release contains forward-looking statements that include guidance for revenue and earnings per share for the fourth quarter of 2015 and full year 2015, the impact of certain items on our results for these periods, statements regarding our sources of revenue, our investments and expenditures, foreign currency exchange rates, assumptions about tax rates, the location of our cash, the allocation of our resources and expenditures and developments, trends, and opportunities in certain markets.  Forward-looking statements may also be identified by words and phrases that refer to future expectations, such as "guidance", "guiding", "forecast", "toward", "plan", "expect", "are expected", "is expected", "believe", "anticipate", "will", "projecting", "look forward", “continue to see”, “outlook” and other similar words and phrases. Factors that could affect these forward-looking statements include, but are not limited to:  the global economic environment, particularly continued slower growth in China and emerging markets; lower than expected customer orders, including for recently-introduced products; potential weakness of the Science and Industry market segments, including continued weakness in the oil and gas sector of the Industry segment resulting from lower oil prices; fluctuations in foreign exchange rates, which, among other things, can affect revenues,  margins, bookings, backlog and the competitive pricing of our products; cyclical and other changes and increased volatility in the semiconductor industry, which is a major component of Industry market segment revenue;  changes in backlog and the timing of shipments from backlog, which may create forecasting challenges; potential delayed or reduced governmental spending to support expected orders; potential disruption in the company's operations due to organizational changes; the relative mix of higher-margin and lower-margin products; potential for increased volatility and challenges in forecasting resulting from larger sales transactions, cancellations and rescheduling of orders by customers; risks associated with a high percentage of the company's revenue coming from book and ship business, when the order for a product is placed by the customer in the same quarter as the planned shipment, and risks associated with building and shipping a high percentage of the company’s quarterly revenue in the last month of the quarter; delays in meeting all accounting requirements for revenue recognition; the ongoing determination of the effectiveness of foreign exchange hedge transactions; the relative mix of U.S. and non-U.S. sales; additional costs related to future merger and acquisition activity; failure of the company to achieve anticipated benefits of acquisitions and collaborations, including failure to achieve financial goals and integrate acquisitions successfully; reduced profitability due to failure to achieve or sustain margin improvement in service or product manufacturing; potential disruption in manufacturing or unexpected additional costs due to the transition from older to newer products; failure to achieve improved operational efficiency and other benefits from infrastructure investments and restructuring activities; potential additional restructurings, realignments and reorganizations;  inability to deploy products as expected or delays in shipping products due to technical problems or barriers, especially with regard to recently introduced TEM products; bankruptcy or insolvency of customers or suppliers; and changes in U.S. and foreign tax rates and laws, accounting rules regarding taxes or agreements with tax authorities. 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.

About FEI:

FEI Company (FEIC) designs, manufactures and supports a broad range of high-performance microscopy workflow solutions that provide images and answers at the micro-, nano- and picometer scales. Its innovation and leadership enable customers in industry and science to increase productivity and make breakthrough discoveries. Headquartered in Hillsboro, Ore., USA, FEI has over 2,800 employees and sales and service operations in more than 50 countries around the world. More information can be found at: www.fei.com.


FEI Company and Subsidiaries
Consolidated Balance Sheets
(In thousands)
(Unaudited)
    
 September 27,
 2015
 December 31,
 2014
Assets   
Current Assets:   
Cash and cash equivalents$381,858  $300,507 
Short-term investments in marketable securities36,015  61,688 
Short-term restricted cash23,444  15,698 
Receivables, net208,909  227,354 
Inventories, net191,648  176,440 
Deferred tax assets8,652  8,225 
Other current assets31,050  35,503 
Total current assets881,576  825,415 
Long-term investments in marketable securities34,016  85,865 
Long-term restricted cash24,758  38,369 
Property plant and equipment, net152,919  163,794 
Intangible assets, net37,815  54,111 
Goodwill145,639  170,773 
Deferred tax assets8,129  6,605 
Long-term inventories47,401  50,731 
Other assets, net19,001  22,155 
Total Assets$1,351,254  $1,417,818 
Liabilities and Shareholders' Equity   
Current Liabilities:   
Accounts payable$67,788  $78,308 
Accrued payroll liabilities37,304  38,599 
Accrued warranty reserves13,159  13,005 
Short-term deferred revenue107,485  96,924 
Income taxes payable4,896  5,299 
Accrued restructuring, reorganization, relocation and severance858  9,161 
Other current liabilities58,289  56,146 
Total current liabilities289,779  297,442 
Long-term deferred revenue39,765  34,021 
Deferred tax liabilities4,694  9,576 
Other liabilities31,752  35,454 
Shareholders' Equity:   
Preferred stock - 500 shares authorized; none issued and outstanding   
Common stock - 70,000 shares authorized; 41,065 and 41,797 shares issued and outstanding at September 27, 2015 and December 31, 2014556,452  607,250 
Retained earnings501,944  461,586 
Accumulated other comprehensive loss(73,132) (27,511)
Total shareholders’ equity985,264  1,041,325 
Total Liabilities and Shareholders' Equity$1,351,254  $1,417,818 


FEI Company and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
    
 Thirteen Weeks Ended Thirty-Nine Weeks Ended
 September 27,
 2015
 September 28,
 2014
 September 27,
 2015
 September 28,
 2014
Net Sales:       
Products$151,843  $169,131  $479,487  $517,459 
Service60,718  58,625  178,079  173,517 
Total net sales212,561  227,756  657,566  690,976 
Cost of Sales:       
Products74,639  83,653  234,965  262,327 
Service33,645  35,522  100,948  103,893 
Total cost of sales108,284  119,175  335,913  366,220 
Gross profit104,277  108,581  321,653  324,756 
Operating Expenses:       
Research and development23,825  25,312  70,275  77,178 
Selling, general and administrative43,467  49,463  132,382  148,513 
Impairment of goodwill and long-lived assets26,596    26,596   
Restructuring, reorganization, relocation and severance(423) 7,699  (565) 11,259 
Total operating expenses93,465  82,474  228,688  236,950 
Operating Income10,812  26,107  92,965  87,806 
Other Expense, Net(1,372) (831) (2,929) (1,907)
Income Before Income Taxes9,440  25,276  90,036  85,899 
Income Tax (Benefit) Expense(978) 3,629  14,274  14,228 
Net Income$10,418  $21,647  $75,762  $71,671 
Basic Net Income Per Share$0.25  $0.52  $1.82  $1.70 
Diluted Net Income Per Share$0.25  $0.51  $1.80  $1.68 
Weighted Average Shares Outstanding:       
Basic41,404  41,891  41,624  42,053 
Diluted41,820  42,465  42,050  42,624 


FEI Company and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
    
 Thirteen Weeks Ended (1) Thirty-Nine Weeks Ended (1)
 September 27,
 2015
 September 28,
 2014
 September 27,
 2015
 September 28,
 2014
Net Sales:       
Products71.4 % 74.3 % 72.9 % 74.9 %
Service28.6   25.7   27.1   25.1  
Total net sales100.0 % 100.0 % 100.0 % 100.0 %
Cost of Sales:       
Products35.1 % 36.7 % 35.7 % 38.0 %
Service15.8   15.6   15.4   15.0  
Total cost of sales50.9 % 52.3 % 51.1 % 53.0 %
Gross Margin:       
Products50.8 % 50.5 % 51.0 % 49.3 %
Service44.6   39.4   43.3   40.1  
Gross margin49.1   47.7   48.9   47.0  
Operating Expenses:       
Research and development11.2 % 11.1 % 10.7 % 11.2 %
Selling, general and administrative20.4   21.7   20.1   21.5  
Impairment of goodwill and long-lived assets12.5      4.0     
Restructuring, reorganization, relocation and severance(0.2)  3.4   (0.1)  1.6  
Total operating expenses44.0 % 36.2 % 34.8 % 34.3 %
Operating Income5.1 % 11.5 % 14.1 % 12.7 %
Other Expense, Net(0.6)% (0.4)% (0.4)% (0.3)%
Income Before Income Taxes4.4 % 11.1 % 13.7 % 12.4 %
Income Tax (Benefit) Expense(0.5)% 1.6 % 2.2 % 2.1 %
Net Income4.9 % 9.5 % 11.5 % 10.4 %
                
(1) Percentages may not add due to rounding.


FEI Company and Subsidiaries
Consolidated Summary of Cash Flows
(In thousands)
(Unaudited)
    
 Thirteen Weeks Ended Thirty-Nine Weeks Ended
 September 27,
 2015
 September 28,
 2014
 September 27,
 2015
 September 28,
 2014
Net Income$10,418  $21,647  $75,762  $71,671 
Depreciation6,301  7,740  18,364  22,379 
Amortization2,765  3,614  8,480  10,478 
Stock-based compensation6,121  6,494  16,615  17,456 
Impairment of goodwill and long-lived assets26,596  40  26,596  322 
Other changes in working capital(6,452) (11,360) (11,084) (49,708)
Net cash provided by operating activities45,749  28,175  134,733  72,598 
Acquisition of property, plant and equipment(2,240) (12,107) (10,109) (35,429)
Payments for acquisitions, net of cash acquired    (5,377) (65,049)
Other investing activities59,783  13,631  76,842  (17,967)
Net cash provided by (used in) investing activities57,543  1,524  61,356  (118,445)
Dividends paid on common stock(12,462) (10,490) (33,340) (20,619)
Repurchases of common stock(42,350) (9,836) (72,575) (40,315)
Other financing activities2,349  2,379  8,675  10,940 
Net cash used in financing activities(52,463) (17,947) (97,240) (49,994)
Effect of exchange rate changes(2,165) (11,683) (17,498) (15,888)
Decrease in cash and cash equivalents48,664  69  $81,351  $(111,729)
Cash and Cash Equivalents:       
Beginning of period333,194  272,372  300,507  384,170 
End of period$381,858  $272,441  $381,858  $272,441 
Supplemental Cash Flow Information:       
Cash paid for income taxes, net$11,825  $4,575  $22,422  $14,458 
Accrued purchases of plant and equipment1,675  986  1,675  986 
Dividends declared but not paid12,453  10,461  12,453  10,461 
Accrued repurchases of common stock1,095    1,095   


FEI Company and Subsidiaries
Supplemental Data Table
($ in millions, except per share amounts)
(Unaudited)
    
 Thirteen Weeks Ended Thirty-Nine Weeks Ended
 September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014
Income Statement Highlights:       
Consolidated sales$212.6  $227.8  $657.6  $691.0 
Gross margin49.1% 47.7% 48.9% 47.0%
Net income$10.4  $21.6  $75.8  $71.7 
Diluted net income per share$0.25  $0.51  $1.80  $1.68 
Sales and Bookings Highlights:       
Sales by Segment       
Industry Group$105.3  $107.1  $336.8  $340.7 
Science Group107.3  120.7  320.8  350.3 
Sales by Geography       
USA & Canada$76.3  $77.0  $217.7  $229.7 
Europe48.6  56.6  159.9  187.2 
Asia-Pacific and Rest of World87.7  94.2  280.0  274.1 
Gross Margin by Segment       
Industry Group52.4% 51.5% 52.4% 51.5%
Science Group45.8  44.3  45.2  42.7 
Bookings and Backlog       
Bookings - Total$233.7  $265.1  $701.2  $773.1 
Book-to-bill Ratio1.10  1.16  1.07  1.12 
Backlog - Total$562.2  $539.0  $562.2  $539.0 
Backlog - Service165.7  160.5  165.7  160.5 
Bookings by Segment       
Industry Group$114.6  $157.8  $364.4  $391.1 
Science Group119.1  107.3  336.8  382.0 
Bookings by Geography       
USA & Canada$99.8  $90.0  $243.5  $234.5 
Europe54.8  65.7  166.1  233.4 
Asia-Pacific and Rest of World79.1  109.4  291.6  305.2 
Balance Sheet and Other Highlights:       
Cash, equivalents, investments, restricted cash$500.1  $493.0  $500.1  $493.0 
Days sales outstanding (DSO)90  88  90  88 
Days in inventory198  190  198  190 
Days in payables (DPO)57  61  57  61 
Cash Cycle (DSO + Days in Inventory - DPO)231  217  231  217 
Working capital$591.8  $543.4  $591.8  $543.4 
Headcount (permanent and temporary)2,855  2,693  2,855  2,693 
Euro average rate1.11  1.33  1.12  1.36 
Euro ending rate1.12  1.27  1.12  1.27 
Yen average rate122.72  103.38  120.88  102.76 
Yen ending rate120.99  109.04  120.99  109.04 

 

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