Cabot Microelectronics Corporation Reports Solid Results for Third Quarter of Fiscal 2014

Cabot Microelectronics Corporation Reports Solid Results for Third Quarter of
Fiscal 2014

  *Revenue of $108.4 Million, Including Record Revenue in Tungsten and
    Advanced Dielectrics Slurry Business Areas
  *Gross Profit Margin of 47.7 Percent of Revenue
  *Earnings Per Share of 53 Cents
  *Purchased $18.6 million of Stock Under Share Repurchase Program

AURORA, Ill., July 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 third quarter
of fiscal 2014, which ended June 30, 2014.

Total revenue during the third fiscal quarter was $108.4 million. The company
generated 2.5 percent revenue growth from its CMP consumables products for
semiconductor applications over the prior year, including record revenue in
its Tungsten and Advanced Dielectrics slurry business areas. However, lower
revenue from the company's QED Technologies business, which is primarily
capital equipment-oriented, primarily drove the 1.5 percent year-over-year
decline in total revenue. The company recorded a gross profit margin of 47.7
percent of revenue in the third fiscal quarter, diluted earnings per share of
$0.53 and cash flow from operations of $21.8 million. The company's balance
sheet reflects a cash balance of $265.5 million and $175.0 million of debt
outstanding as of June 30, 2014. During the quarter, the company purchased
$18.6 million of stock under its share repurchase program, compared to $10.0
million in the same quarter last year.

"We are pleased to have achieved record revenue in our Tungsten and Advanced
Dielectrics slurry businesses this quarter, as well as additional
year-over-year revenue growth in our Aluminum slurry and CMP Pads businesses,
and nearly 40 percent revenue growth in China," said William Noglows, Chairman
and CEO of Cabot Microelectronics. "We believe our broad and deep capabilities
as a CMP technology leader, including global infrastructure close to our
customers around the world, and a commitment to excellence in global supply
chain management and quality systems, differentiate us from our competitors.
Based on this, we believe we are well-positioned to leverage advanced
technologies such as 3D NAND, FinFet and multi-patterning, which have driven
the need for new innovations in fab materials and should drive increased
demand for CMP consumables."

Key Financial Information

Total third fiscal quarter revenue of $108.4 million represents a 1.5 percent
decrease from the $110.0 million reported in the same quarter last year, on
lower revenue from the company's QED Technologies business, which more than
offset 2.5 percent growth from the company's IC CMP consumables products. In
particular, the company achieved record revenue in its Tungsten and Advanced
Dielectrics slurry businesses this quarter, and revenue from its CMP Pads and
Aluminum slurry businesses grew compared to the same quarter last year. Year
to date revenue of $308.3 million is 2.7 percent lower than the prior year,
reflecting lower revenue from QED Technologies, and also including a $2.7
million adverse impact associated with foreign exchange rate changes,
primarily the weaker Japanese yen versus the U.S. dollar.

Gross profit, expressed as a percentage of revenue, was 47.7 percent this
quarter, compared to 49.7 percent of revenue reported in the same quarter a
year ago. Compared to the year ago quarter, gross profit percentage decreased
primarily due to higher variable manufacturing costs, including higher raw
material costs and higher logistics costs. Year to date, gross profit
represented 47.3 percent of revenue, which includes a 70 basis point adverse
impact of an asset impairment charge related to certain manufacturing assets
recorded during the second fiscal quarter. The company expects its gross
profit for the full fiscal year to be around 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 $33.2 million in
the third fiscal quarter, or $0.8 million higher than the $32.4 million
reported in the same quarter a year ago, primarily due to higher travel costs,
and professional fees associated with amending the company's existing credit
agreement, which was completed this quarter. Year to date, total operating
expenses were $97.2 million, or 3.0 percent lower than the previous fiscal
year. The company continues to expect operating expenses for the full fiscal
year to be between $127 million and $131 million.

Net income for the quarter was $13.3 million, down from $15.5 million reported
in the same quarter last year. Net income was lower primarily due to a lower
gross profit margin and lower revenue, partially offset by a lower effective
tax rate. Year to date, net income was $34.7 million, which is up 0.3 percent
compared to the prior year.

Diluted earnings per share were $0.53 this quarter, compared to $0.65 reported
in the third quarter of fiscal 2013, which included a $0.05 benefit associated
with the company's permanent reinvestment election in Japan. Year to date,
diluted earnings per share were $1.39, which includes the adverse impact of
$0.06 due to the asset impairment charge recorded during the second fiscal
quarter, compared to $1.46 last year.


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,, or
by phone at (844) 825-4410. Callers outside the U.S. can dial (973) 638-3236.
The conference code for the call is 69642903. 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.


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 or contact Trisha Tuntland, Manager of Investor
Relations at 630-499-2600.


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
March 31, 2014 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.

(Unaudited and amounts in thousands, except per share amounts)
                        Quarter Ended                   Nine Months Ended
                        June 30,   March 31, June 30,   June 30,   June 30,
                        2014       2014      2013       2014       2013
Revenue                  $108,358 $99,456 $109,968 $308,329 $316,865
Cost of goods sold       56,632     52,931    55,359     162,364    163,872
Gross profit             51,726     46,525    54,609     145,965    152,993
Operating expenses:                                             
Research, development &  15,368     14,364    15,149     44,303     45,538
Selling & marketing      6,489      6,471     6,470      19,667     20,625
General & administrative 11,380     11,076    10,776     33,182     34,017
Total operating expenses 33,237     31,911    32,395     97,152     100,180
Operating income         18,489     14,614    22,214     48,813     52,813
Interest expense         832        843       907        2,547      2,732
Other income, net        (132)      103       248        588        1,565
Income before income     17,525     13,874    21,555     46,854     51,646
Provision for income     4,223      3,779     6,062      12,149     17,030
Net income               $13,302  $10,095 $15,493  $34,705  $34,616
Income available to      $13,126  $9,962  $15,493  $34,394  $34,616
common shareholders
Basic earnings per share $0.55      $0.42     $0.68      $1.45      $1.51
Weighted average basic   23,753     23,982    22,951     23,769     22,897
shares outstanding
Diluted earnings per     $0.53      $0.40     $0.65      $1.39      $1.46
Weighted average diluted 24,613     24,897    23,776     24,704     23,729
shares outstanding

(Unaudited and amounts in thousands)
                                         June 30,         September 30,
                                         2014             2013
Current assets:                                           
Cash and cash equivalents                 $265,515       $226,029
Accounts receivable, net                  55,375          54,640
Inventories, net                          70,904          63,786
Other current assets                      21,037          18,343
Total current assets                      412,831          362,798
Property, plant and equipment, net        105,944         111,985
Other long-term assets                    71,203          76,809
Total assets                              $589,978       $551,592
Current liabilities:                                      
Accounts payable                          $12,428        $16,663
Current portion of long-term debt         8,750           10,938
Accrued expenses, income taxes payable    27,465          40,620
and other current liabilities
Total current liabilities                 48,643           68,221
Long-term debt, net of current portion    166,250         150,937
Other long-term liabilities               10,543          8,992
Total liabilities                         225,436         228,150
Stockholders' equity                      364,542         323,442
Total liabilities and stockholders'       $589,978       $551,592
The Consolidated Condensed Balance Sheet at September 30, 2013 has been
revised to reflect certain non-material adjustments related to prior periods.

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