INFICON Reports Third-Quarter 2007 Results
Net Sales Rise to USD 58.2 Million; Financial Targets Announced for 2008
SYRACUSE, N.Y. & ZURICH, Switzerland--(BUSINESS WIRE)--Oct. 18, 2007--INFICON (SWX Swiss Exchange: IFCN), a leading manufacturer of instrumentation and process control software for the semiconductor and vacuum-coating industries and other industrial applications, today announced financial results for the third quarter ended September 30, 2007.
Revenues for the third quarter of 2007 totaled USD 58.2 million compared to USD 54.4 million for the third quarter of 2006, representing a 6.8% increase. On a constant dollar basis, revenues for the quarter increased 4.8%. INFICON reported net income of USD 4.9 million, or USD 2.13 per diluted share, including a one-time, non-cash charge related to a reduction in Germany's corporate tax rate beginning in 2008 that, under U.S. GAAP accounting, required a write-down of the company's tax asset by USD 1.2 million, resulting in an EPS impact of USD 0.54. These results compared to net income of USD 5.9 million, or USD 2.49 per diluted share, for the third quarter of 2006. Excluding the one-time charge, the company would have earned net income of USD 6.1 million in the third quarter of 2007. Cash provided by operating activities was USD 9.7 million compared to USD 13.1 million in the same quarter last year.
Revenues for the nine months ended September 30, 2007 were USD 173.1 million compared to USD 155.9 million for the same period in 2006, representing an 11.1% increase. On a constant dollar basis, revenues increased 9.0%. Net income for the period increased 13.8% to USD 17.3 million, or USD 7.32 per diluted share, compared to net income of USD 15.2 million, or USD 6.41 per diluted share, the previous year. Excluding the above mentioned one-time charge in the third quarter, the company would have earned net income of USD 18.5 million in the first nine months of 2007.
"INFICON delivered another quarter of solid results with growth in different product lines and regions," commented Lukas Winkler, president and chief executive officer. "In the semiconductor and vacuum coating markets, sales increased year over year, including orders for Stiletto Scanning-Laser Particle Detector, the newly introduced Sion RF Detector, for our whole suite of in situ sensors, and for FabGuard fault detection and analysis software. Our sales to vacuum coating OEMs also contributed to a good third-quarter performance, validating our recent acquisition of Maxtek, Inc., a developer and manufacturer of high-quality thin film measurement instruments.
"We experienced significant growth in sales to the refrigeration and air conditioning (RAC) market. These industries are an important business driver for INFICON, and we continue to expand our presence and take market share in China, where our high-end products are setting the standard in leak detection for quality control. Sales to the RAC and automotive markets in the U.S. were also strong in the third quarter, coming from many key customers.
"Performance in the emergency response and security market was in line with our expectations and on par with sales in the third quarter of last year. We are continuing to provide upgrades of the HAPSITE Chemical Identification System and training to the U.S. Air Force. Finally, our business in the general vacuum processes market remained strong despite the generally slower summer period, helped by the increasing diversification of our customer base.
Mr. Winkler continued, "As a result of another quarter of solid execution across our markets, we remain on track to meet the financial goals we set for 2007. For the year, we expect to achieve revenue growth of close to 10% and an operating margin of approximately 14% - compared to the 13 -14% range we originally targeted. We believe INFICON is also well-positioned to grow in 2008. Based on our innovative technologies and pipeline of new products, combined with the many operational improvements we have made, we are targeting revenues for next year in the range of USD 250 - 260 million, including acquisitions, and an operating margin in the range of 14.5 - 15.5%."
As a result of a reduction in the corporate tax rate in Germany starting in 2008, the company remeasured the deferred tax assets in its German subsidiary in the period for which the change was enacted into law. This resulted in a one-time, non-cash charge of USD 1.2 million in the third quarter of 2007. INFICON expects this tax law change to result in a significantly lower effective tax rate for its German subsidiary going forward and to recover the amount of the charge within the next few years.
As of October 18, 2007, INFICON spent USD 35.6 million, or CHF 42.4 million, to repurchase 210,855 shares of common stock at an average purchase price of CHF 200.88 per share as part of its share buyback program. This represents 8.95% of the voting rights in INFICON Holding AG. Entering the fourth quarter of 2007, the company had 2,169,929 shares outstanding, of which 24,732 remain available for repurchase under its share buyback program. The company expects to complete the repurchase program before year-end. As previously announced, its Board intends to propose the cancellation of all repurchased shares at the ordinary Annual General Meeting of Shareholders on April 24, 2008.
Conference Call and Visual Presentation: INFICON will hold an earnings teleconference, including presentation slides, that will be webcast on October 18, 2007 at 4:00 p.m. CEST (10:00 a.m. EDT). Participants in Switzerland can access the call by dialing 0.800.891.753. Other participants can dial in at +1.706.634.1033. All participants should dial in at least 10 minutes prior to the call. The conference call ID number is 19299831. The audio and visual webcast will be available in the Investor Relations section of the INFICON website. Please visit www.inficon.com, where our presentation will be available approximately 20 minutes prior to the teleconference and webcast.
A replay of the call will be available from approximately 7:00 p.m. CEST (1:00 p.m. EDT) on October 18, 2007 through 05:59 a.m. CEST on October 26, 2007 (11:59 p.m. EDT on October 25). To access the replay, all callers should dial +1.706.645.9291, conference ID 19299831. The webcast and visual presentation will also remain available on the INFICON website.
Email Alerts: The latest financial information from INFICON can automatically be sent via Email Alert; sign up is available in the Investor Relations section of the INFICON website.
ABOUT INFICON
INFICON is a leading developer, manufacturer and supplier of innovative instrumentation, critical sensor technologies, and advanced process control software for the semiconductor and vacuum-coating industries and other industrial applications. These analysis, measurement and control products are vital to original equipment manufacturers (OEMs) and end-users in the complex manufacturing of semiconductors, flat panel displays, magnetic and optical storage media and precision optics. INFICON also provides essential instrumentation for gas leak detection to the air conditioning/refrigeration industries and toxic chemical analysis for the emergency response and security markets. INFICON has world-class manufacturing facilities in the United States and Europe and subsidiaries in the U.S., China, France, Germany, Japan, Korea, Liechtenstein, Singapore, Switzerland, Taiwan, and the United Kingdom. INFICON registered shares (IFCN) are listed on the SWX Swiss Stock Exchange. For more information about INFICON and its products, please visit www.inficon.com.
This press release and oral statements or other written statements made, or to be made, by us contain forward-looking statements that do not relate solely to historical or current facts. These forward-looking statements are based on the current plans and expectations of our management and are subject to a number of uncertainties and risks that could significantly affect our current plans and expectations, as well as future results of operations and financial condition. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.