Apr 27, 2010

Entegris Reports Results for First Quarter

Quarterly Sequential Sales Growth of 10 Percent and Non-GAAP EPS of $0.15

BILLERICA, Mass., April 27, 2010 (GLOBE NEWSWIRE) -- Entegris, Inc. (Nasdaq:ENTG) today reported its financial results for the Company's first quarter ended April 3, 2010.

The Company recorded first-quarter sales of $160.5 million and net income of $16.6 million, or $0.12 per diluted share. These results included amortization of intangible assets of $4.3 million. The Company reported sales of $59.0 million and a loss of $0.34 per share in the first quarter a year ago and sales of $146.3 million and net income of $0.08 per share in the fourth quarter of 2009.

Non-GAAP EPS in the first quarter of 2010 was $0.15 per diluted share, which compared to a non-GAAP loss per share of $0.26 in the first quarter a year ago. A reconciliation table of GAAP to non-GAAP earnings (loss) per share is contained in this press release.

Gideon Argov, president and chief executive officer, said: "Our first-quarter sales growth reflected continued positive trends in our core semiconductor markets. Utilization rates and production levels at our semiconductor fab customers remained at high levels, and capital spending in the industry continued to be robust.  

"We were very pleased with our operating performance in the quarter, which reflects the positive impact of the structural cost reductions we put in place during the past year.  Our manufacturing execution in the quarter was excellent and contributed to first-quarter operating margin of 16.5 percent of sales, excluding amortization. This is above our target model and well above what we would have achieved in previous quarters on comparable revenue," Argov said.

In the first quarter, the Company generated $28 million in cash from operations, reduced its debt by $20.4 million, and ended the quarter with a cash balance of $22.1 million, net of debt.

Segment Information (table of results contained at the end of this release)

Contamination Control Solutions (CCS) sales in the first quarter increased 8 percent sequentially, primarily driven by sales of fluid-handling components and gas purification systems used in semiconductor and microelectronics manufacturing equipment. Demand for filtration products remained strong through the quarter.  

First-quarter sales of Microenvironments (ME) product increased 10 percent from the fourth quarter, driven by sales of wafer process products for semiconductor wafers and data storage shippers. 

Specialty Materials sales in the first quarter rose 23 percent sequentially, driven by a continued rebound in sales of specialty coated and graphite-based components used in semiconductor manufacturing. Sales of Specialty Materials products to markets other than the semiconductor industry improved modestly. 

First-Quarter Results Conference Call Details

Entegris will hold a conference call to discuss its results for the first quarter on Tuesday, April 27, 2010, at 10:00 a.m. Eastern Time.  Participants should dial 1-888-297-8997 (domestic callers) or 1-719-325-2296 (for callers outside of the U.S.), referencing confirmation code #7005049. A webcast of the call can also be accessed from the investor relations section of Entegris' website at www.entegris.com.

About Entegris

Entegris is a leading provider of a wide range of products for purifying, protecting and transporting critical materials used in processing and manufacturing in the semiconductor and other high-tech industries. Entegris is ISO 9001 certified and has manufacturing, customer service and/or research facilities in the United States, China, France, Germany, Israel, Japan, Malaysia, Singapore, South Korea and Taiwan. Additional information can be found at www.entegris.com.

The Entegris, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3700

Non-GAAP Information

The Company's consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (GAAP). Adjusted EBITDA and Adjusted Operating Income together with related measures thereof, and non-GAAP EPS, are considered "Non-GAAP financial measures" under the rules and regulations of the SEC. These financial measures are provided as a complement to financial measures provided in accordance with GAAP. We provide non-GAAP financial measures in order to better assess and reflect operating performance. Management believes the non-GAAP measures help indicate our baseline performance before certain gains, losses or other charges that may not be indicative of our business or future outlook. We believe these non-GAAP measures will aid investors' overall understanding of our results by providing a higher degree of transparency for certain expenses and providing a level of disclosure that will help investors understand how we plan and measure our business. The presentation of non-GAAP measures is not meant to be considered in isolation, as a substitute for, or superior to, financial measures or information provided in accordance with GAAP. The calculations of Adjusted EBITDA margin, Adjusted Operating Income, and non-GAAP EPS are included elsewhere in this release.

Forward-Looking Statements

Certain information contained in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current management expectations only as of the date of this press release, and involve substantial risks and uncertainties that could cause actual results to differ materially from the results expressed in, or implied by, these forward-looking statements. Statements that include such words as "anticipate," "believe," "estimate," "expect," "forecast," "may," "will," "should" or the negative thereof and similar expressions as they relate to Entegris or our management are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. These risks include, but are not limited to, fluctuations in the market price of Entegris' stock, Entegris' future operating results, other acquisition and investment opportunities available to Entegris, general business and market conditions and other factors. Additional information concerning these and other risk factors may be found in previous financial press releases issued by Entegris and Entegris' periodic public filings with the Securities and Exchange Commission, including discussions appearing under the headings "Risks Relating to our Business and Industry," "Risks Related to our Borrowings", "Manufacturing Risks," "International Risks," and "Risks Related to Owning Our Securities" in Item 1A of our Annual Report on Form 10–K for the fiscal year ended December 31, 2009, as well as other matters and important factors disclosed previously and from time to time in the filings of Entegris with the U.S. Securities and Exchange Commission. Except as required under the federal securities laws and the rules and regulations of the Securities and Exchange Commission, we undertake no obligation to update publicly any forward-looking statements contained herein.

Entegris, Inc. and Subsidiaries  
Consolidated Statements of Operations  
(In thousands, except per share data)  
(Unaudited)  
   
  Three months ended
  April 3, 2010December 31, 2009March 28, 2009
Net sales $160,511 $146,324 $59,038
Cost of sales 87,360 82,037 54,020
Gross profit 73,151 64,287 5,018
Selling, general and administrative expenses 35,782 32,420 29,721
Engineering, research and development expenses 10,820 9,717 8,904
Amortization of intangible assets 4,272 4,602 4,981
Restructuring charges -- 3,009 4,634
Operating income (loss) 22,277 14,539 (43,222)
Interest expense, net 1,206 2,110 1,847
Other (income) expense, net (293) 1,316 (5,222)
Income (loss) before income taxes 21,364 11,113 (39,847)
Income tax expense (benefit) 4,809 1,231 (2,598)
Equity in net (earnings) loss of affiliates (191) (210) 496
Net income (loss)  16,746 10,092 (37,745)
Net income (loss) attributable to noncontrolling interest 196 (32) --
Net income (loss) attributable to Entegris, Inc. $16,550 $10,124 $(37,745)
     
Amounts attributable to Entegris, Inc.:  
Basic net income (loss) per common share: $0.13 $0.08 $(0.34)
Diluted net income (loss) per common share: $0.12 $0.08 $(0.34)
    
Weighted average shares outstanding:   
Basic 130,954 129,953 112,348
Diluted 132,783 131,887 112,348
    
Entegris, Inc. and Subsidiaries   
Consolidated Balance Sheets    
(In thousands)    
(Unaudited)    
     
   April 3, 2010December 31, 2009
ASSETS    
Cash and cash equivalents $ 73,253 $ 68,700
Accounts receivable, net  103,269 91,122
Inventories  88,689 83,233
Deferred tax assets, deferred tax charges and refundable income taxes 10,992 11,085
Other current assets and assets held for sale 14,091 13,318
Total current assets 290,294 267,458
     
Property, plant and equipment, net 131,923 135,431
     
Intangible assets 74,018 78,470
Deferred tax assets – non-current 10,393 9,670
Other assets  13,328 13,643
Total assets  $519,956 $504,672
     
LIABILITIES AND EQUITY 
Current maturities of long-term debt $ 10,931 $ 11,257
Short-term borrowings 3,816 8,039
Accounts payable  30,472 23,553
Accrued liabilities  35,422 29,832
Income tax payable and deferred tax liabilities  5,655 1,229
Total current liabilities 86,296 73,910
     
Long-term debt, less current maturities 36,406 52,492
Other liabilities  27,700 28,613
Equity  369,554 349,657
Total liabilities and equity $519,956 $504,672
  
Entegris, Inc. and Subsidiaries 
Consolidated Statements of Cash Flows 
(In thousands) 
(Unaudited) 
 Three months ended
 April 3, 2010March 28, 2009
Operating activities:  
Net income (loss) $16,746 $(37,745)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:  
Depreciation 6,724 8,270
Amortization 4,272 4,981
Stock-based compensation expense 1,794 1,810
Charge for fair value mark-up of acquired inventory -- 4,065
Other (2,336) 4,564
Changes in operating assets and liabilities:  
Trade accounts receivable and notes receivable (12,612) 16,167
Inventories (5,035) 1,595
Accounts payable and accrued liabilities 13,076 (2,834)
Income taxes payable and refundable income taxes 5,358 (5,852)
Other 36 (4,565)
Net cash provided by (used in) operating activities 28,023 (9,544)
Investing activities:  
Acquisition of property and equipment (3,603) (7,940)
Other 26 50
Net cash used in investing activities (3,577) (7,890)
Financing activities:  
Payments and proceeds on short-term borrowings and long-term debt, net (20,427) 
3,577
Issuance of common stock 782 570
Payments for debt issuance costs -- (3,464)
Net cash (used in) provided by financing activities (19,645) 683
Effect of exchange rate changes on cash (248) (2,832)
Increase (decrease) in cash and cash equivalents 4,553 (19,583)
Cash and cash equivalents at beginning of period 68,700 115,033
Cash and cash equivalents at end of period $73,253 $95,450
   
Entegris, Inc. and Subsidiaries
Segment Information 
(In thousands) 
(Unaudited)
 
 Three Months Ended
Net salesApril 3, 2010December 31, 2009March 28, 2009
Contamination Control Solutions $100,742  $ 93,687 $34,287
Microenvironments 41,927 38,162 14,682
Specialty Materials 17,842 14,475 10,069
Total net sales $160,511 $146,324 $59,038
 Three Months Ended
Segment profit (loss)April 3, 2010December 31, 2009March 28, 2009
Contamination Control Solutions $28,234 $23,127 $ (8,670)
Microenvironments 8,980 8,898 (10,195)
Specialty Materials 2,342 1,985 617
Total segment profit (loss) 39,556 34,010 (18,248)
Amortization of intangibles, amortization of fair value mark-up of acquired inventory sold and restructuring charges (4,272) (8,048) (13,680)
Unallocated expenses (13,007) (11,423) (11,294)
 Total operating income (loss) $22,277 $14,539 $(43,222)
 
Entegris, Inc. and Subsidiaries
Reconciliation of GAAP to Adjusted Operating Income (Loss) and Adjusted EBITDA
(In thousands)
(Unaudited)
 
 Three Months Ended
 April 3, 2010December 31, 2009March 28, 2009
Net sales $160,511 $146,324 $59,038
GAAP – Operating income (loss) $22,277 $14,539 $(43,222)
 Restructuring charges -- 3,009 4,634
 Charge for fair value mark-up of acquired inventory sold -- 437 4,065
 Amortization of intangible assets 4,272 4,602 4,981
Adjusted operating income (loss) 26,549 22,587 (29,542)
 Depreciation 6,724 7,262 8,270
Adjusted EBITDA $33,273 $29,849 $(21,272)
    
Adjusted operating margin 16.5% 15.4% (50.0)%
Adjusted EBITDA – as a % of net sales 20.7% 20.4% (36.0)%
 
Entegris, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Earnings (Loss) per Share
(In thousands)
(Unaudited)
 
 Three Months Ended
 April 3, 2010December 31, 2009March 28, 2009
GAAP net income (loss) attributable to the Company $16,550 $10,124 $(37,745)
Adjustments to net income (loss) attributable to the Company:   
 Amortization of intangible assets 4,272 4,602 4,981
Charge for fair value mark-up of acquired inventory sold -- 437 4,065
Impairment of equity investments -- 1,000 --
Tax effect of adjustments to net income (loss) attributable to the Company (1,567) (130) --
Non-GAAP net income (loss) attributable to the Company 
$19,255
 
$16,033
 
$(28,699)
    
Diluted earnings (loss) per common share: $0.12 $0.08 $(0.34)
Effect of adjustments to net income (loss) attributable to the Company 0.02 0.04 (0.08)
Diluted non-GAAP earnings (loss) per common share: $0.15 $0.12 $(0.26)
CONTACT:  Entegris, Inc.
          Steve Cantor, VP of Corporate Relations
          978-436-6750
          irelations@entegris.com

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