Cabot Microelectronics Corporation Reports Results for Second Quarter of Fiscal 2014

Cabot Microelectronics Corporation Reports Results for Second Quarter of
Fiscal 2014

  *Revenue of $99.5 Million, In Line with Industry Demand Patterns
  *Gross Profit Margin of 46.8 Percent of Revenue; Non-GAAP 48.9 Percent,
    Excluding Asset Impairment Charge
  *Earnings Per Share of 40 Cents; Non-GAAP 46 Cents, Excluding Impairment
  *Increase in Authorized Share Purchase Program to $150 Million from
    Previously Remaining $62 Million

AURORA, Ill., April 24, 2014 (GLOBE NEWSWIRE) -- Cabot Microelectronics
Corporation (Nasdaq:CCMP), the world's leading supplier of chemical mechanical
planarization (CMP) polishing slurries and a growing CMP pad supplier to the
semiconductor industry, today reported financial results for its second
quarter of fiscal 2014, which ended March 31, 2014.

Total revenue during the second fiscal quarter was $99.5 million. This
reflects a decrease of 0.9 percent compared to the same quarter last year due
to continued softness in demand within the global semiconductor industry. The
company recorded a gross profit margin of 46.8 percent of revenue in the
second fiscal quarter, which includes the adverse effect of a $2.1 million
asset impairment charge; non-GAAP gross profit margin was 48.9 percent of
revenue, excluding this impairment, which is 70 basis points higher than in
the same quarter last year. The company recorded diluted earnings per share of
$0.40 for the second fiscal quarter. Excluding the impairment charge, non-GAAP
diluted earnings per share were $0.46, which represents an increase of 15.0
percent compared to the prior year quarter. The company's balance sheet
reflects a cash balance of $239.1 million and $157.5 million of debt
outstanding as of March 31, 2014. During the quarter, the company purchased
$20.0 million of stock under its share repurchase program, compared to $10.0
million in the same quarter last year.

"We are pleased with our solid financial performance this quarter in light of
continued soft demand within the global semiconductor industry," said William
Noglows, Chairman and CEO of Cabot Microelectronics. "Within this environment,
and excluding the impact of an asset impairment charge this quarter, we
improved our gross margin, and also grew our net income by 23 percent
year-over-year, on slightly lower revenue; on this basis, we have now expanded
gross margins year-over-year for five consecutive quarters."

Mr. Noglows continued, "As a result of our intensive focus on supporting our
customers, as well as excellence in our global supply chain management and in
our quality systems, during the quarter we earned a number of awards from our
customers for our performance in 2013. We are proud to have earned Intel's
most prestigious award for suppliers, the Supplier Continuous Quality
Improvement Award, for the second consecutive year. In addition, we are
honored to have received SMIC's Best Quality Award, HHGrace's Best Service
Supplier Award, and Huali's Outstanding Supplier Award. Our close
collaborations with our customers in China resulted in approximately 23
percent revenue growth there compared to the same quarter last year. We look
forward to continuing our efforts to consistently exceed our customers'
requirements."

Mr. Noglows concluded, "Through our strong historical financial performance,
we have established a track record of delivering significant value to our
shareholders, and in further support of this our Board of Directors has
authorized an increase in our existing share repurchase program to $150
million from the previously remaining level of $62 million. We remain
committed to continuing to provide value to our shareholders."

Key Financial Information

Total second fiscal quarter revenue of $99.5 million represents a 0.9 percent
decrease from the $100.4 million reported in the same quarter last year. The
company believes revenues reflect continued soft demand within the global
semiconductor industry that began to appear late in the fourth fiscal quarter
of 2013, as well as a $1.0 million adverse impact associated with foreign
exchange rate changes, primarily the weaker Japanese yen versus the U.S.
dollar. Compared to the same quarter last year, revenue from the company's CMP
slurry products for polishing aluminum, tungsten and advanced dielectrics
increased, and the company's CMP polishing pads business achieved revenue
growth of 4.8 percent. Revenue from all other major business areas decreased.
Revenue for the first half of the fiscal year totaled $200.0 million, which is
3.3 percent lower than in the prior year. Year to date revenue includes a $2.8
million adverse impact associated with foreign exchange rate changes,
primarily the weaker Japanese yen.

Gross profit, expressed as a percentage of revenue, was 46.8 percent this
quarter, which includes a $2.1 million asset impairment charge related to
certain manufacturing assets. Excluding the impairment charge, non-GAAP gross
profit was 48.9 percent of revenue, which is 70 basis points higher than the
48.2 percent of revenue reported in the same quarter a year ago. Other factors
impacting gross profit this quarter compared to last year include benefits
associated with a weaker Japanese yen and lower incentive compensation costs,
partially offset by higher variable manufacturing costs, including higher raw
material costs. Year to date, gross profit represented 47.1 percent of
revenue. Excluding the impairment charge, year to date non-GAAP gross profit
was 48.1 percent, which represents a 50 basis point improvement over the first
six months of fiscal 2013. In light of first half results, including the
impairment, the company currently expects its gross profit for the full fiscal
year to be near the lower end of its guidance range of 48 to 50 percent of
revenue.

Operating expenses, which include research, development and technical, selling
and marketing, and general and administrative expenses, were $31.9 million in
the second fiscal quarter, or $2.5 million lower than the $34.4 million
reported in the same quarter a year ago, primarily due to lower staffing
related costs, including incentive compensation costs. Year to date, total
operating expenses were $63.9 million, or 5.7 percent lower than the previous
fiscal year. The company is lowering its full fiscal year guidance range for
operating expenses to $127 million to $131 million; this is $4 million lower
than the company's prior guidance range of $131 million to $135 million.

Net income for the quarter was $10.1 million, or $11.6 million on a non-GAAP
basis, excluding the referenced asset impairment, up from $9.4 million
reported in the same quarter last year.Net income was higher than in the same
quarter last year, primarily due to lower operating expenses, partially offset
by a lower gross profit margin.Year to date, net income was $21.4 million.
Excluding the asset impairment, year to date non-GAAP net income was $22.9
million, which is up 19.6 percent compared to the prior year.Last year's
results include an adverse $1.7 million foreign tax adjustment.

Diluted earnings per share were $0.40 this quarter, or $0.46 on a non-GAAP
basis, excluding the asset impairment, compared to $0.40 reported in the
second quarter of fiscal 2013.Year to date, diluted earnings per share were
$0.86, or $0.92 on a non-GAAP basis, excluding the impairment, compared to
$0.81 last year, which included the adverse impact of $0.07 due to last year's
foreign tax adjustment.

On April 22 the company's Board of Directors authorized an increase in the
company's existing share repurchase program to $150 million, from the
previously remaining approximately $62 million, which is consistent with the
company's strategy to return value to shareholders.Over the last decade, the
company has purchased roughly $270 million of stock under several share
repurchase programs, and also distributed approximately $347 million to
shareholders in 2012 as a special cash dividend as part of the company's
capital management initiative.The company's key priorities for capital
allocation continue to be funding organic growth opportunities, share
repurchases and acquisition opportunities in closely related areas.

CONFERENCE CALL

Cabot Microelectronics Corporation's quarterly earnings conference call will
be held today at 9:00 a.m. Central Time.The conference call will be available
via live webcast and replay from the company's website, www.cabotcmp.com, or
by phone at (877) 359-9508.Callers outside the U.S. can dial (224)
357-2393.The conference code for the call is 24389352.A transcript of the
formal comments made during the conference call will also be available in the
Investor Relations section of the company's website.

USE OF NON-GAAP FINANCIAL INFORMATION

The company presented the following measures considered as non-GAAP by the
U.S. Securities and Exchange Commission: gross profit margin, net income and
diluted earnings per share excluding the effects of an asset impairment charge
related to certain manufacturing assets.The non-GAAP financial information
provided in this press release is a supplement to, and not a substitute for,
the company's financial results presented in accordance with U.S. GAAP.These
non-GAAP financial measures are provided to enhance the investor's
understanding about the company's ongoing operations.Specifically, the
company believes the asset impairment charge is not indicative of its core
operating results, and thus presents its gross profit margin, net income and
diluted earnings per share excluding the effects of such asset impairment
charge.The presentation of non-GAAP financial information is not meant to be
considered in isolation or as a substitute for results prepared and presented
in accordance with U.S. GAAP.A reconciliation table of GAAP to non-GAAP gross
profit percentage, net income and diluted earnings per share is contained in
this press release.

ABOUT CABOT MICROELECTRONICS CORPORATION

Cabot Microelectronics Corporation, headquartered in Aurora, Illinois, is the
world's leading supplier of CMP polishing slurries and a growing CMP pad
supplier to the semiconductor industry.The company's products play a critical
role in the production of advanced semiconductor devices, enabling the
manufacture of smaller, faster and more complex devices by its customers.The
company's mission is to create value by developing reliable and innovative
solutions, through close customer collaboration, that solve today's challenges
and help enable tomorrow's technology.Since becoming an independent public
company in 2000, the company has grown to approximately 1,050 employees on a
global basis.For more information about Cabot Microelectronics Corporation,
visit www.cabotcmp.com or contact Trisha Tuntland, Manager of Investor
Relations at 630-499-2600.

SAFE HARBOR STATEMENT

This news release may include statements that constitute "forward looking
statements" within the meaning of federal securities regulations.These
forward-looking statements include statements related to:future sales and
operating results; company and industry growth, contraction or trends; growth
or contraction of the markets in which the company participates; international
events, regulatory or legislative activity, or various economic factors;
product performance; the generation, protection and acquisition of
intellectual property, and litigation related to such intellectual property;
new product introductions; development of new products, technologies and
markets; natural disasters; the acquisition of or investment in other
entities; uses and investment of the company's cash balance; financing
facilities and related debt, payment of principal and interest, and compliance
with covenants and other terms; the company's capital structure; and the
construction and operation of facilities by Cabot Microelectronics
Corporation.These forward-looking statements involve a number of risks,
uncertainties, and other factors, including those described from time to time
in Cabot Microelectronics' filings with the Securities and Exchange Commission
(SEC), that could cause actual results to differ materially from those
described by these forward-looking statements.In particular, see "Risk
Factors" in the company's quarterly report on Form 10-Q for the quarter ended
December 31, 2013 and in the company's annual report on Form 10-K for the
fiscal year ended September 30, 2013, both filed with the SEC.Cabot
Microelectronics assumes no obligation to update this forward-looking
information.

CABOT MICROELECTRONICS CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited and amounts in thousands, except per share amounts)


                      Quarter Ended                     Six Months Ended
                      March 31, December 31, March 31,  March 31,  March 31,
                      2014      2013         2013       2014       2013
                                                               
Revenue                $99,456 $100,515   $100,364 $199,971 $206,897
                                                               
Cost of goods sold     52,931    52,801       52,019     105,732    108,513
                                                               
Gross profit           46,525    47,714       48,345     94,239     98,384
                                                               
Operating expenses:                                             
                                                               
Research, development  14,364    14,571       15,073     28,935     30,389
& technical
                                                               
Selling & marketing    6,471     6,707        7,046      13,178     14,155
                                                               
General &              11,076    10,726       12,287     21,802     23,241
administrative
                                                               
Total operating        31,911    32,004       34,406     63,915     67,785
expenses
                                                               
Operating income       14,614    15,710       13,939     30,324     30,599
                                                               
Interest expense       843       872          872        1,715      1,825
                                                               
Other income, net      103       617          463        720        1,317
                                                               
Income before income   13,874    15,455       13,530     29,329     30,091
taxes
                                                               
Provision for income   3,779     4,147        4,110      7,926      10,968
taxes
                                                               
Net income             $10,095 $11,308    $9,420   $21,403  $19,123
                                                               
                                                               
                                                               
Income available to    $9,962  $11,181    $9,420   $21,200  $19,123
common shareholders
                                                               
                                                               
Basic earnings per     $ 0.42    $ 0.47       $ 0.41     $ 0.89     $ 0.84
share
                                                               
Weighted average basic 23,982    23,590       22,974     23,775     22,914
shares outstanding
                                                               
Diluted earnings per   $ 0.40    $ 0.45       $ 0.40     $ 0.86     $ 0.81
share
                                                               
Weighted average
diluted shares         24,897    24,623       23,871     24,749     23,755
outstanding


CABOT MICROELECTRONICS CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited and amounts in thousands)

                                                     March 31,  September 30,
                                                     2014       2013
ASSETS:                                                         
                                                               
Current assets:                                                 
Cash and cash equivalents                             $239,147 $226,029
Accounts receivable, net                              53,133    54,640
Inventories, net                                      71,574    63,786
Other current assets                                  26,093    21,257
Total current assets                                  389,947    365,712
                                                               
Property, plant and equipment, net                    106,178   111,985
Other long-term assets                                70,392    76,809
Total assets                                          $566,517 $554,506
                                                               
                                                               
LIABILITIES AND STOCKHOLDERS' EQUITY:                           
                                                               
Current liabilities:                                            
Accounts payable                                      $14,331  $16,663
Current portion of long-term debt                     13,125    10,938
Accrued expenses, income taxes payable and other      24,191    39,899
current liabilities
Total current liabilities                             51,647     67,500
                                                               
Long-term debt, net of current portion                144,375   150,937
Other long-term liabilities                           10,172    8,992
Total liabilities                                     206,194   227,429
                                                               
Stockholders' equity                                  360,323   327,077
Total liabilities and stockholders' equity            $566,517 $554,506


CABOT MICROELECTRONICS CORPORATION
Reconciliation of Non-GAAP Financial Measures

The following presents reconciliation of the non-GAAP financial measures
included in the Cabot
Microelectronics Corporation press release dated April 24, 2014.

Reconciliation of Non-GAAP Gross Profit Percentage
                                      
                                      Quarter Ended       Six Months Ended
                                      March 31, March 31, March 31, March 31,
                                      2014      2013      2014      2013
                                                                 
GAAP gross profit %                    46.8%     48.2%     47.1%     47.6%
Impact of asset impairment charge on   2.1%      --       1.0%      --
gross profit %
Gross profit % excluding asset         48.9%     48.2%     48.1%     47.6%
impairment charge
                                                                 
                                                                 
                                                                 
                                                                 
                                                                 
Reconciliation of Non-GAAP Net Income Presentation
                                                                 
                                      Quarter Ended       Six Months Ended
                                      March 31, March 31, March 31, March 31,
                                      2014      2013      2014      2013
                                                                 
GAAP net income                        $10,095 $9,420  $21,403 $19,123
Impact of asset impairment charge on   1,475    --       1,475    --
net income
Net income excluding asset impairment  $11,570 $9,420  $22,878 $19,123
charge
                                                                 
                                                                 
                                                                 
                                                                 
                                                                 
Reconciliation of Non-GAAP Diluted Earnings Per Share (EPS) Presentation
                                                                 
                                      Quarter Ended       Six Months Ended
                                      March 31, March 31, March 31, March 31,
                                      2014      2013      2014      2013
                                                                 
GAAP diluted EPS                       $0.40   $0.40   $0.86   $0.81
Impact of asset impairment charge on   0.06     --       0.06     --
diluted EPS
Diluted EPS excluding asset impairment $0.46   $0.40   $0.92   $0.81
charge

CONTACT: Trisha Tuntland
         Manager, Investor Relations
         (630) 499-2600

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