MILPITAS, Calif., Oct. 20,
2016 /PRNewswire/ -- KLA-Tencor Corporation (NASDAQ: KLAC) today
announced operating results for its first quarter of fiscal year
2017, which ended on September 30, 2016, and reported GAAP net
income of $178 million and GAAP
earnings per diluted share of $1.13
on revenues of $751 million.
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"KLA-Tencor's Q1 results finished above the midpoint of the
range of guidance for shipments and revenue for the quarter, and
exceeded the range for Non-GAAP diluted earnings per share,"
commented Rick Wallace, President
and Chief Executive Officer of KLA-Tencor. "Our performance in Q1
was fueled by strong customer acceptance of new products and a
business model that consistently delivers superior operating
leverage, providing the resources to rank KLA-Tencor among the top
tier of all companies in tech in terms of cash returns to
stockholders."
GAAP
Results
|
|
Q1 FY
2017
|
Q4 FY
2016
|
Q1 FY
2016
|
Revenues
|
$751 million
|
$919 million
|
$643 million
|
Net Income
|
$178 million
|
$272 million
|
$105 million
|
Earnings per Diluted
Share
|
$1.13
|
$1.73
|
$0.66
|
|
|
|
|
Non-GAAP
Results
|
|
Q1 FY
2017
|
Q4 FY
2016
|
Q1 FY
2016
|
Net Income
|
$182 million
|
$277 million
|
$112 million
|
Earnings per Diluted
Share
|
$1.16
|
$1.77
|
$0.71
|
A reconciliation between GAAP operating results and non-GAAP
operating results is provided following the financial statements
that are part of this release. Non-GAAP results include the impact
of stock-based compensation, but exclude the impact of
acquisitions, restructuring, severance and other related charges,
and merger-related charges. KLA-Tencor will discuss the results for
its fiscal year 2017 first quarter, along with its
outlook, on a conference call today beginning at 2:00 p.m. Pacific Daylight Time. A webcast of the
call will be available at: www.kla-tencor.com.
About KLA-Tencor:
KLA-Tencor Corporation, a leading provider of process control
and yield management solutions, partners with customers around the
world to develop state-of-the-art inspection and metrology
technologies. These technologies serve the semiconductor, LED and
other related nanoelectronics industries. With a portfolio of
industry-standard products and a team of world-class engineers and
scientists, the company has created superior solutions for its
customers for 40 years. Headquartered in Milpitas, Calif., KLA-Tencor has dedicated
customer operations and service centers around the world.
Additional information may be found at http://www.kla-tencor.com.
(KLAC-F)
Use of Non-GAAP Financial Information:
The non-GAAP and supplemental information provided in this press
release is a supplement to, and not a substitute for, KLA-Tencor's
financial results presented in accordance with United States
GAAP.
To supplement KLA-Tencor's condensed consolidated financial
statements presented in accordance with GAAP, the company provides
certain non-GAAP financial information, which is adjusted from
results based on GAAP to exclude certain costs and expenses, as
well as other supplemental information. The non-GAAP and
supplemental information is provided to enhance the user's overall
understanding of KLA-Tencor's operating performance and its
prospects in the future. Specifically, KLA-Tencor believes that the
non-GAAP information provides useful measures to both management
and investors regarding financial and business trends relating to
KLA-Tencor's financial performance by excluding certain costs and
expenses that the company believes are not indicative of its core
operating results. The non-GAAP information is among the budgeting
and planning tools that management uses for future forecasting.
However, because there are no standardized or generally accepted
definitions for most non-GAAP financial metrics, definitions of
non-GAAP financial metrics (for example, determining which costs
and expenses to exclude when calculating such a metric) are
inherently subject to significant discretion. As a result, non-GAAP
financial metrics may be defined very differently from company to
company, or even from period to period within the same company,
which can potentially limit the usefulness of such information to
an investor. The presentation of non-GAAP and supplemental
information is not meant to be considered in isolation or as a
substitute for results prepared and presented in accordance with
United States GAAP.
KLA-Tencor
Corporation
|
|
|
|
Condensed
Consolidated Unaudited Balance Sheets
|
|
|
|
|
|
|
|
(In
thousands)
|
September 30,
2016
|
|
June 30,
2016
|
ASSETS
|
|
|
|
Cash, cash
equivalents and marketable securities
|
$
|
2,494,621
|
|
|
$
|
2,491,294
|
|
Accounts receivable,
net
|
654,699
|
|
|
613,233
|
|
Inventories
|
703,262
|
|
|
698,635
|
|
Other current
assets
|
76,580
|
|
|
64,870
|
|
Land, property and
equipment, net
|
272,351
|
|
|
278,014
|
|
Goodwill
|
335,198
|
|
|
335,177
|
|
Deferred income
taxes, non-current
|
267,793
|
|
|
302,219
|
|
Purchased
intangibles, net
|
3,065
|
|
|
4,331
|
|
Other non-current
assets
|
188,529
|
|
|
174,659
|
|
Total
assets
|
$
|
4,996,098
|
|
|
$
|
4,962,432
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
105,066
|
|
|
$
|
106,517
|
|
Deferred system
profit
|
185,640
|
|
|
174,551
|
|
Unearned
revenue
|
54,841
|
|
|
59,147
|
|
Other current
liabilities
|
629,194
|
|
|
662,208
|
|
Total current
liabilities
|
974,741
|
|
|
1,002,423
|
|
Non-current
liabilities:
|
|
|
|
Long-term
debt
|
3,018,567
|
|
|
3,057,936
|
|
Unearned
revenue
|
60,279
|
|
|
56,336
|
|
Other non-current
liabilities
|
161,002
|
|
|
156,623
|
|
Total
liabilities
|
4,214,589
|
|
|
4,273,318
|
|
Stockholders'
equity:
|
|
|
|
Common stock and
capital in excess of par value
|
447,018
|
|
|
452,974
|
|
Retained
earnings
|
381,124
|
|
|
284,825
|
|
Accumulated other
comprehensive income (loss)
|
(46,633)
|
|
|
(48,685)
|
|
Total stockholders'
equity
|
781,509
|
|
|
689,114
|
|
Total liabilities and
stockholders' equity
|
$
|
4,996,098
|
|
|
$
|
4,962,432
|
|
KLA-Tencor
Corporation
|
|
|
|
Condensed
Consolidated Unaudited Statements of Operations
|
|
|
|
|
|
Three months ended
September 30,
|
(In thousands,
except per share amounts)
|
2016
|
|
2015
|
Revenues:
|
|
|
|
Product
|
$
|
561,753
|
|
|
$
|
460,739
|
|
Service
|
188,920
|
|
|
181,905
|
|
Total
revenues
|
750,673
|
|
|
642,644
|
|
Costs and
expenses:
|
|
|
|
Costs of
revenues
|
277,836
|
|
|
270,244
|
|
Research and
development
|
129,233
|
|
|
119,943
|
|
Selling, general and
administrative
|
94,388
|
|
|
91,663
|
|
Interest expense and
other, net
|
26,996
|
|
|
26,495
|
|
Income before income
taxes
|
222,220
|
|
|
134,299
|
|
Provision for income
taxes
|
44,119
|
|
|
29,402
|
|
Net income
|
$
|
178,101
|
|
|
$
|
104,897
|
|
Net income per
share:
|
|
|
|
Basic
|
$
|
1.14
|
|
|
$
|
0.67
|
|
Diluted
|
$
|
1.13
|
|
|
$
|
0.66
|
|
Cash dividends
declared per share
|
$
|
0.52
|
|
|
$
|
0.52
|
|
Weighted-average
number of shares:
|
|
|
|
Basic
|
156,129
|
|
|
156,820
|
|
Diluted
|
157,021
|
|
|
157,984
|
|
KLA-Tencor
Corporation
|
Condensed
Consolidated Unaudited Statements of Cash Flows
|
|
|
Three months
ended
|
September
30,
|
(In
thousands)
|
2016
|
|
2015
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
178,101
|
|
|
$
|
104,897
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
14,422
|
|
|
19,735
|
|
Asset impairment
charges
|
358
|
|
|
—
|
|
Non-cash stock-based
compensation expense
|
11,478
|
|
|
12,248
|
|
Excess tax benefit
from equity awards
|
—
|
|
|
(10,159)
|
|
Net gain on sales of
marketable securities and other investments
|
(204)
|
|
|
(1,233)
|
|
Changes in assets and
liabilities:
|
|
|
|
Decrease (increase)
in accounts receivable, net
|
(38,241)
|
|
|
124,925
|
|
Decrease (increase)
in inventories
|
1,187
|
|
|
(31,243)
|
|
Decrease in other
assets
|
19,477
|
|
|
34,381
|
|
Increase (decrease)
in accounts payable
|
(1,547)
|
|
|
4,158
|
|
Increase (decrease)
in deferred system profit
|
11,089
|
|
|
(14,504)
|
|
Decrease in other
liabilities
|
(26,343)
|
|
|
(49,423)
|
|
Net cash provided by
operating activities
|
169,777
|
|
|
193,782
|
|
Cash flows from
investing activities:
|
|
|
|
Acquisition of
non-marketable securities
|
(1,470)
|
|
|
—
|
|
Capital expenditures,
net
|
(9,883)
|
|
|
(7,341)
|
|
Purchases of
available-for-sale securities
|
(457,512)
|
|
|
(343,358)
|
|
Proceeds from sale of
available-for-sale securities
|
111,106
|
|
|
200,353
|
|
Proceeds from
maturity of available-for-sale securities
|
197,100
|
|
|
184,973
|
|
Purchases of trading
securities
|
(52,465)
|
|
|
(18,267)
|
|
Proceeds from sale of
trading securities
|
45,301
|
|
|
15,540
|
|
Net cash provided by
(used in) investing activities
|
(167,823)
|
|
|
31,900
|
|
Cash flows from
financing activities:
|
|
|
|
Repayment of
debt
|
(40,000)
|
|
|
(40,000)
|
|
Tax withholding
payments related to vested and released restricted stock
units
|
(17,376)
|
|
|
(21,526)
|
|
Common stock
repurchases
|
—
|
|
|
(142,592)
|
|
Payment of dividends
to stockholders
|
(89,313)
|
|
|
(101,674)
|
|
Excess tax benefit
from equity awards
|
—
|
|
|
10,159
|
|
Net cash used in
financing activities
|
(146,689)
|
|
|
(295,633)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
2,572
|
|
|
(4,377)
|
|
Net decrease in cash
and cash equivalents
|
(142,163)
|
|
|
(74,328)
|
|
Cash and cash
equivalents at beginning of period
|
1,108,488
|
|
|
838,025
|
|
Cash and cash
equivalents at end of period
|
$
|
966,325
|
|
|
$
|
763,697
|
|
Supplemental cash
flow disclosures:
|
|
|
|
Income taxes paid,
net
|
$
|
39,411
|
|
|
$
|
7,844
|
|
Interest
paid
|
$
|
3,243
|
|
|
$
|
3,149
|
|
Non-cash
activities:
|
|
|
|
Purchase of land,
property and equipment - investing activities
|
$
|
1,974
|
|
|
$
|
1,490
|
|
Unsettled common
stock repurchase - financing activities
|
$
|
—
|
|
|
$
|
9,610
|
|
Dividends payable -
financing activities
|
$
|
12,045
|
|
|
$
|
20,892
|
|
KLA-Tencor
Corporation
|
Condensed
Consolidated Unaudited Supplemental Information
|
(In thousands,
except per share amounts)
|
|
Reconciliation of
GAAP Net Income to Non-GAAP Net Income
|
|
|
|
|
Three months
ended
|
|
|
|
September 30,
2016
|
|
June 30,
2016
|
|
September 30,
2015
|
GAAP net
income
|
|
$
|
178,101
|
|
|
$
|
271,541
|
|
|
$
|
104,897
|
|
Adjustments to
reconcile GAAP net income to non-GAAP net income:
|
|
|
|
|
|
|
|
Acquisition-related
charges
|
a
|
1,267
|
|
|
1,294
|
|
|
3,581
|
|
|
Restructuring,
severance and other related charges
|
b
|
—
|
|
|
—
|
|
|
7,066
|
|
|
Merger-related
charges
|
c
|
3,605
|
|
|
5,795
|
|
|
—
|
|
|
Income tax effect of
non-GAAP adjustments
|
d
|
(1,259)
|
|
|
(1,795)
|
|
|
(3,348)
|
|
Non-GAAP net
income
|
|
$
|
181,714
|
|
|
$
|
276,835
|
|
|
$
|
112,196
|
|
GAAP net income per
diluted share
|
|
$
|
1.13
|
|
|
$
|
1.73
|
|
|
$
|
0.66
|
|
Non-GAAP net income
per diluted share
|
|
$
|
1.16
|
|
|
$
|
1.77
|
|
|
$
|
0.71
|
|
Shares used in
diluted shares calculation
|
|
157,021
|
|
|
156,618
|
|
|
157,984
|
|
Pre-tax impact of
items included in Condensed Consolidated Unaudited Statements of
Operations
|
|
|
Acquisition-
related charges
|
|
Restructuring,
severance and other related charges
|
|
Merger-related
charges
|
|
Total pre-tax GAAP
to non-GAAP adjustments
|
Three months ended
September 30, 2016
|
|
|
|
|
|
|
|
Costs of
revenues
|
$
|
650
|
|
|
$
|
—
|
|
|
$
|
260
|
|
|
$
|
910
|
|
Research and
development
|
—
|
|
|
—
|
|
|
982
|
|
|
982
|
|
Selling, general and
administrative
|
617
|
|
|
—
|
|
|
2,363
|
|
|
2,980
|
|
Total in three months
ended September 30, 2016
|
$
|
1,267
|
|
|
$
|
—
|
|
|
$
|
3,605
|
|
|
$
|
4,872
|
|
Three months ended
June 30, 2016
|
|
|
|
|
|
|
|
Costs of
revenues
|
$
|
658
|
|
|
$
|
—
|
|
|
$
|
346
|
|
|
$
|
1,004
|
|
Research and
development
|
—
|
|
|
—
|
|
|
1,223
|
|
|
1,223
|
|
Selling, general and
administrative
|
636
|
|
|
—
|
|
|
4,226
|
|
|
4,862
|
|
Total in three months
ended June 30, 2016
|
$
|
1,294
|
|
|
$
|
—
|
|
|
$
|
5,795
|
|
|
$
|
7,089
|
|
Three months ended
September 30, 2015
|
|
|
|
|
|
|
|
Costs of
revenues
|
$
|
2,285
|
|
|
$
|
2,770
|
|
|
$
|
—
|
|
|
$
|
5,055
|
|
Research and
development
|
650
|
|
|
1,010
|
|
|
—
|
|
|
1,660
|
|
Selling, general and
administrative
|
646
|
|
|
3,286
|
|
|
—
|
|
|
3,932
|
|
Total in three months
ended September 30, 2015
|
$
|
3,581
|
|
|
$
|
7,066
|
|
|
$
|
—
|
|
|
$
|
10,647
|
|
To supplement our condensed consolidated financial statements
presented in accordance with GAAP, we provide certain non-GAAP
financial information, which is adjusted from results based on GAAP
to exclude certain costs and expenses, as well as other
supplemental information. The non-GAAP and supplemental information
is provided to enhance the user's overall understanding of our
operating performance and our prospects in the future.
Specifically, we believe that the non-GAAP information provides
useful measures to both management and investors regarding
financial and business trends relating to our financial performance
by excluding certain costs and expenses that we believe are not
indicative of our core operating results. The non-GAAP information
is among the budgeting and planning tools that management uses for
future forecasting. However, because there are no standardized or
generally accepted definitions for most non-GAAP financial metrics,
definitions of non-GAAP financial metrics (for example, determining
which costs and expenses to exclude when calculating such a metric)
are inherently subject to significant discretion. As a result,
non-GAAP financial metrics may be defined very differently from
company to company, or even from period to period within the same
company, which can potentially limit the usefulness of such
information to an investor. The presentation of non-GAAP and
supplemental information is not meant to be considered in isolation
or as a substitute for results prepared and presented in accordance
with United States GAAP.
- Acquisition-related charges includes amortization of intangible
assets associated with acquisitions. Management believes that the
expense associated with the amortization of acquisition related
intangible assets is appropriate to be excluded because a
significant portion of the purchase price for acquisitions may be
allocated to intangible assets that have short lives, and exclusion
of these expenses allows comparisons of operating results that are
consistent over time for both KLA-Tencor's newly acquired and
long-held businesses. Management believes excluding these items
helps investors compare our operating performance with our results
in prior periods as well as with the performance of other
companies.
- Restructuring, severance and other related charges include
costs associated with employee severance and other exit costs.
Management believes excluding these items helps investors compare
our operating performance with our results in prior periods as well
as with the performance of other companies.
- Merger-related charges that are directly related to the
proposed merger between KLA-Tencor and Lam that was terminated on
October 5, 2016. Charges primarily
includes employee-related expenses, legal expenses and other costs.
Management believes that it is appropriate to exclude these items
as they are not indicative of ongoing operating results and
therefore limit comparability and excluding these items helps
investors compare our operating performance with our results in
prior periods as well as with the performance of other
companies.
- Income tax effect of non-GAAP adjustments includes the income
tax effects of the excluded items noted above. Management believes
that it is appropriate to exclude the tax effects of the items
noted above in order to present a more meaningful measure of
non-GAAP net income.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/kla-tencor-reports-fiscal-2017-first-quarter-results-300348624.html
SOURCE KLA-Tencor Corporation