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KLA-Tencor Posts Second Quarter Earnings of $29 Million on Revenues of $335 Million
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SAN JOSE, Calif., January 23, 2003 - KLA-Tencor Corp. (Nasdaq: KLAC) today announced its operating results for its second quarter of fiscal 2003, ended December 31, 2002. The company posted net income of $29 million and earnings per share of $0.15 on revenues of $335 million, as compared to $49 million on revenues of $404 million for the same period of the prior fiscal year. Revenue declined by 11 percent, as compared with the first quarter of fiscal 2003. Income was lower by 43 percent, as a result of the change in revenue, gains in the first quarter and restructuring-related expenses in the second quarter. For the three-month period the company continued to realize significant net income and strong cash flow.

"We continue to post quality earnings, despite one of the deepest downturns in the history of the semiconductor industry," stated Kenneth Schroeder, KLA-Tencor Chief Executive Officer. "Driving our results is that the fact that our comprehensive process control solutions play a pivotal role in helping our customers be more competitive by accelerating the development and production of the next-generation devices that are critical to their profitability. Through diligent financial management and extra efforts from our employees, we have continued to invest in new product development, while also cutting costs, delivering strong asset management performance, and maintaining healthy income from operations."

KLA-Tencor continues to maintain its historical backlog position of approximately six months of shipment backlog, based on current shipment levels. Gross margin of 49 percent decreased slightly from 50 percent in the previous quarter, due primarily to a higher percentage of service revenue.

Geographically, the percentage of orders from the United States was at historical norms and Taiwan was below historical levels, while Europe, Japan and the rest of Asia were above historical averages.

Total cash, cash equivalents and marketable securities were $1.3 billion at quarter end. During the quarter, the company invested $120 million in the purchase of its previously leased campus land and buildings. This investment was offset by strong working capital management. Inventory decreased $29 million to $290 million. Accounts receivable increased by $1 million on higher quarter to quarter shipments, resulting in record low days sales outstanding based on shipments. The company continues to have no long-term debt.

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Forward Looking Statements: Statements in this press release regarding current order backlog and the effect of cost-saving measures may be construed as forward-looking statements, and are subject to the Safe Harbor provisions created by the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current information and expectations, and involve a number of risks and uncertainties. Actual results may differ materially from those projected in such statements due to various factors, including but not limited to: delays or cancellations of orders by customers; shipments or acceptances; inability by the company to meet its production and/or product development schedules; the demand for semiconductors; and new and enhanced product offerings by competitors. For other factors that may cause actual results to differ from those projected, please refer to the company's Form 10-K, Forms 10-Q and other filings with the Securities and Exchange Commission. Actual results could differ materially from those anticipated in forward-looking statements in this release as a result of certain factors, including those set forth in the risk factors described in the company's SEC filings.

Contact:
Meggan Powers
Director Corporate Communications

 

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