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Home > Press > FEI Reports Record Revenue and Earnings: Revenue of $211.1 Million Up 45% From Q2-2010 GAAP EPS of $0.62

Abstract:
For the second quarter of 2011, FEI Company (Nasdaq:FEIC) reported record revenue and earnings for the third quarter in a row. Bookings were the highest for any second quarter in the company's history and the second-highest ever.

FEI Reports Record Revenue and Earnings: Revenue of $211.1 Million Up 45% From Q2-2010 GAAP EPS of $0.62

Hillsboro, OR | Posted on August 2nd, 2011

Revenue of $211.1 million was up 45% compared to $146.0 million in the second quarter of 2010 and up 7% from $197.0 million in the first quarter of 2011.

Net income was $26.1 million or $0.62 per diluted share, compared with $16.2 million or $0.40 per diluted share in the second quarter of 2010 and $22.3 million or $0.54 per diluted share in the first quarter of 2011.

The gross margin in the second quarter was 45.3%, compared with 41.0% in the second quarter of 2010 and 43.6% in the first quarter of 2011. Operating income was 17.3% of sales in the quarter, compared with 2.4% in the second quarter of 2010 and 16.2% in the first quarter of 2011.

Last year's second quarter results included $9.1 million of restructuring charges that reduced operating income, compared with restructuring charges of $0.8 million in this year's second quarter. The 2010 second quarter also included a net tax benefit of $13.5 million that increased net income, compared with tax expense in the latest quarter of $9.6 million.

For the second quarter of 2011, net bookings were $204.5 million, up 17% from the second quarter of 2010 and up 7% from the first quarter of 2011. The backlog at the end of the quarter was $459.1 million. The book-to-bill ratio for the quarter was 0.97 to 1.

Gross cash, investments and restricted cash at the end of the quarter was $471.3 million, an increase of $19.5 million during the quarter and $47.5 million since the end of 2010.

"We had another very good quarter, with revenue and earnings again at the highest level in our history," said Don Kania, president and CEO of FEI. "Gross margins expanded as expected, and operating margins increased. Bookings remained strong with double-digit sequential growth in the Research and Industry and Electronics market segments. For the third quarter, we expect significant revenue growth compared with last year and a slight normal seasonal decline in revenue compared with the second quarter. We are projecting revenue growth of approximately 30% for 2011 over 2010."

Bookings and revenue comparisons for the company's market segments and other data are included in the supplementary information attached to this release, along with detailed statements of operations and balance sheets.

Guidance for Q3 2011

FEI expects revenue in the third quarter of 2011 to be in the range of $195 million to $210 million. Bookings are expected to be in the range of $175 million to $195 million. GAAP earnings per share are expected to be in the range of $0.51 to $0.57.

Investor Conference Call -- 2:00 p.m. Pacific time, Tuesday, August 2, 2011

Parties interested in listening to FEI's quarterly conference call may do so by dialing 1-877-941-8631 (U.S., toll-free) or 1-480-629-9723 (international and toll), with the conference title: FEI Second Quarter Earnings Call, Conference ID 4459281. A telephone replay of the call will be available at 1-800-406-7325 (U.S., toll-free) or 1-303-590-3030 (international and toll) with the passcode: 4459281#. The call can also be accessed via the web by going to FEI's Investor Relations page at www.fei.com, where the webcast will also be archived.

####

About FEI Company
FEI (Nasdaq:FEIC) is a leading diversified scientific instruments company. It is a premier provider of electron and ion-beam microscopes and tools for nanoscale applications globally and across many industries: industrial and academic materials research, life sciences, semiconductors, data storage, natural resources and more. With a history of over 60 years of technological innovation and leadership, FEI has set the performance standard in transmission electron microscopes (TEM), scanning electron microscopes (SEM) and DualBeams™, which combine a SEM with a focused ion beam (FIB). FEI's imaging systems provide 3D characterization, analysis and modification/prototyping with resolutions down to the sub-Ångström (one-tenth of a nanometer) level. FEI has over 1,900 employees and sales and service operations in more than 50 countries around the world.

Safe Harbor Statement

This news release contains forward-looking statements that include statements regarding our guidance for revenue and earnings per share for the third quarter of 2011, expected annual revenue growth for 2011 and expected bookings for the third quarter of 2011. Forward-looking statements may also be identified by words and phrases that refer to future expectations, such as "guidance", "projecting", "expect", "expects", "are expected", "will", "estimate", and other similar words and phrases. Factors that could affect these forward-looking statements include, but are not limited to, the global economic environment; lower than expected customer orders and potential weakness of the Research and Industry, Electronics and Life Sciences market segments; problems in obtaining necessary product components in sufficient volumes on a timely basis from our supply chain; bankruptcy or insolvency of customers or suppliers; cyclical changes in the data storage and semiconductor industries, which are the major components of Electronics market revenue; fluctuations in foreign exchange, interest and tax rates; changes in tax rate and laws, accounting rules regarding taxes or agreements with tax authorities; the ongoing determination of the effectiveness of foreign exchange hedge transactions; reduced profitability due to failure to achieve or sustain margin improvement in service or product manufacturing; the relative mix of higher-margin and lower-margin products; risks associated with shipping a high percentage of the company's quarterly revenue in the last month of the quarter; customer requests to defer planned shipments; increased competition and new product offerings from competitors; lower average sales prices and reduced margins on some product sales due to increased competition; failure of the company's products and technology, including new products, to find acceptance with customers; inability to deploy products as expected or delays in shipping products due to technical problems or barriers; potential shipment or supply chain disruptions due to natural disasters or terrorist attacks; changes to or potential additional restructurings and reorganizations not presently anticipated; reduced sales due to geopolitical risks; changes in trade policies and tariff regulations; changes in the regulatory environment in the nations where we do business; additional selling, general and administrative or research and development expenses; potential reduced governmental spending due to budget constraints and current uncertainty around global sovereign debt; additional costs related to future merger and acquisition activity; and failure of the company to achieve anticipated benefits of acquisitions and collaborations, including failure to achieve financial goals and integrate future acquisitions successfully. 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.

FEI Company and Subsidiaries
Consolidated Balance Sheets
(In thousands)
(Unaudited)
July 3, April 3, December 31,
2011 2011 2010
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $305,923 $367,265 $277,617
Short-term investments in marketable securities 18,855 3,362 44,026
Short-term restricted cash 28,615 30,250 22,114
Receivables, net 207,075 178,755 183,254
Inventories, net 202,769 179,487 155,964
Deferred tax assets 10,431 10,514 11,505
Other current assets 35,890 38,601 23,126
Total current assets 809,558 808,234 717,606
Non-current investments in marketable securities 76,135 12,572 38,662
Long-term restricted cash 41,815 38,352 41,377
Non-current inventories 51,072 48,402 47,976
Property plant and equipment, net 82,039 81,799 80,681
Goodwill 44,849 44,832 44,800
Deferred tax assets 770 869 1,072
Other assets, net 14,570 15,077 12,248
TOTAL $1,120,808 $1,050,137 $984,422
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $61,348 $55,656 $51,529
Accrued liabilities 60,163 48,497 51,209
Deferred revenue 84,549 86,232 81,445
Income taxes payable 14,078 9,287 3,715
Accrued restructuring, reorganization and relocation 2,613 3,070 4,884
Other current liabilities 29,400 31,352 31,306
Total current liabilities 252,151 234,094 224,088
Convertible debt 89,012 89,012 89,012
Other liabilities 44,902 41,283 38,148
SHAREHOLDERS' EQUITY:
Preferred stock - 500 shares authorized; none issued and outstanding
Common stock - 70,000 shares authorized; 39,150, 38,690, and 38,280 shares
issued and outstanding at July 3, 2011, April 3, 2011 and December 31, 2010 534,161 520,968 509,145
Retained earnings 123,396 97,336 75,024
Accumulated other comprehensive income 77,186 67,444 49,005
Total shareholders' equity 734,743 685,748 633,174
TOTAL $1,120,808 $1,050,137 $984,422
FEI Company and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Thirteen Weeks Ended Twenty-Six Weeks Ended
July 3, April 3, July 4, July 3, July 4,
2011 2011 2010 2011 2010
NET SALES:
Products $168,896 $156,032 $108,931 $324,928 $220,808
Service and components 42,245 40,928 37,117 83,173 74,339
Total net sales 211,141 196,960 146,048 408,101 295,147
COST OF SALES:
Products 86,256 83,595 62,068 169,851 126,756
Service and components 29,190 27,461 24,172 56,651 49,378
Total cost of sales 115,446 111,056 86,240 226,502 176,134
Gross margin 95,695 85,904 59,808 181,599 119,013
OPERATING EXPENSES:
Research and development 19,619 17,940 15,616 37,559 32,748
Selling, general and administrative 38,774 35,782 31,604 74,556 67,179
Restructuring, reorganization and relocation 783 285 9,055 1,068 9,969
Total operating expenses 59,176 54,007 56,275 113,183 109,896
OPERATING INCOME 36,519 31,897 3,533 68,416 9,117
OTHER INCOME (EXPENSE), NET (893) (222) (900) (1,115) (1,536)
INCOME BEFORE TAXES 35,626 31,675 2,633 67,301 7,581
INCOME TAX EXPENSE (BENEFIT) 9,566 9,363 (13,547) 18,929 (12,703)
NET INCOME $26,060 $22,312 $16,180 $48,372 $20,284
BASIC NET INCOME PER SHARE DATA $0.67 $0.58 $0.43 $1.25 $0.53
DILUTED NET INCOME PER SHARE DATA $0.62 $0.54 $0.40 $1.16 $0.51
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic 38,883 38,478 38,046 38,686 37,968
Diluted 42,566 42,101 41,813 42,359 41,775
FEI Company and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
Thirteen Weeks Ended (1) Twenty-Six Weeks Ended (1)
July 3, April 3, July 4, July 3, July 4,
2011 2011 2010 2011 2010
NET SALES:
Products 80.0% 79.2% 74.6% 79.6% 74.8%
Service and components 20.0% 20.8% 25.4% 20.4% 25.2%
Total net sales 100.0% 100.0% 100.0% 100.0% 100.0%
COST OF SALES:
Products 40.9% 42.4% 42.5% 41.6% 42.9%
Service and components 13.8% 13.9% 16.6% 13.9% 16.7%
Total cost of sales 54.7% 56.4% 59.0% 55.5% 59.7%
GROSS MARGIN:
Products 48.9% 46.4% 43.0% 47.7% 42.6%
Service and components 30.9% 32.9% 34.9% 31.9% 33.6%
Gross margin 45.3% 43.6% 41.0% 44.5% 40.3%
OPERATING EXPENSES:
Research and development 9.3% 9.1% 10.7% 9.2% 11.1%
Selling, general and administrative 18.4% 18.2% 21.6% 18.3% 22.8%
Restructuring, reorganization and relocation 0.4% 0.1% 6.2% 0.3% 3.4%
Total operating expenses 28.0% 27.4% 38.5% 27.7% 37.2%
OPERATING INCOME 17.3% 16.2% 2.4% 16.8% 3.1%
OTHER INCOME (EXPENSE), NET (0.4)% (0.1)% (0.6)% (0.3)% (0.5)%
INCOME BEFORE TAXES 16.9% 16.1% 1.8% 16.5% 2.6%
INCOME TAX EXPENSE (BENEFIT) 4.5% 4.8% (9.3)% 4.6% (4.3)%
NET INCOME 12.3% 11.3% 11.1% 11.9% 6.9%
(1) Percentages may not add due to rounding.
FEI COMPANY
Supplemental Data Table
($ in millions, except per share amounts)
(Unaudited)
Q2 Ended Q1 Ended Q2 Ended
3-Jul-2011 3-Apr-2011 4-Jul-2010
Income Statement Highlights
Consolidated sales $ 211.1 $ 197.0 $ 146.0
Gross margin 45.3% 43.6% 41.0%
Stock compensation expense $ 2.8 $ 2.8 $ 2.7
Net income $ 26.1 $ 22.3 $ 16.2
Diluted net income per share $ 0.62 $ 0.54 $ 0.40
Interest income add back included in the calculation of diluted EPS $ 0.5 $ 0.5 $ 0.6
Sales Highlights
Sales by Market Segment
Electronics $ 87.0 $ 61.4 $ 56.9
Research & Industry $ 55.1 $ 70.7 $ 37.4
Life Sciences $ 26.8 $ 24.0 $ 14.6
Service and Components $ 42.2 $ 40.9 $ 37.1
Sales by Geography
USA & Canada $ 74.2 $ 63.6 $ 46.1
Europe $ 59.2 $ 58.1 $ 45.7
Asia-Pacific and Rest of World $ 77.7 $ 75.3 $ 54.2
Gross Margin by Market Segment
Electronics 51.9% 51.8% 49.0%
Research & Industry 44.9% 43.6% 37.4%
Life Sciences 47.7% 41.2% 34.0%
Service and Components 30.9% 32.9% 34.9%
Bookings and Backlog
Bookings - total $ 204.5 $ 190.8 $ 175.1
Book-to-bill ratio 0.97 0.97 1.20
Backlog - total $ 459.1 $ 465.7 $ 402.5
Backlog - Service and Components $ 91.4 $ 88.5 $ 81.2
Bookings by Market Segment
Electronics $ 76.1 $ 64.5 $ 71.6
Research & Industry $ 64.5 $ 55.1 $ 40.4
Life Sciences $ 18.7 $ 23.1 $ 27.5
Service and Components $ 45.2 $ 48.1 $ 35.6
Bookings by Geography
USA & Canada $ 46.7 $ 48.5 $ 57.6
Europe $ 76.0 $ 65.5 $ 47.8
Asia-Pacific and Rest of World $ 81.8 $ 76.8 $ 69.7
Balance Sheet Highlights
Cash, equivalents, investments, restricted cash $ 471.3 $ 451.8 $ 375.5
Operating cash generated $ 9.2 $ 9.7 $ 25.1
Accounts receivable $ 207.1 $ 178.8 $ 153.2
Days sales outstanding (DSO) 89 83 96
Inventory turnover 2.4 2.6 2.6
Fixed asset investment $ 3.9 $ 1.9 $ 1.8
Depreciation expense $ 4.7 $ 4.5 $ 4.2
Working capital $ 557.4 $ 574.1 $ 482.0
Headcount (permanent and temporary) 1,957 1,844 1,791
Euro average rate 1.439 1.366 1.281
Euro ending rate 1.449 1.409 1.258

For more information, please click here

Contacts:
FEI Company
Fletcher Chamberlin
Treasurer & Communications Director
(503) 726-7710

Copyright © GlobeNewswire, Inc.

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