Asyst Reports Results for Third Quarter of Fiscal 2008

Asyst Technologies, Inc. (Nasdaq:ASYT), a leading provider of integrated automation solutions that enhance semiconductor and flat panel display manufacturing productivity, today reported financial results for its fiscal third quarter ended Dec. 31, 2007. Net loss for the fiscal third quarter according to GAAP was $0.9 million, or $0.02 per share, which compares with net income of $0.5 million, or $0.01 per share, in the prior sequential quarter. Non-GAAP net income for the fiscal third quarter was $1.0 million, or $0.02 per share, which compares with $6.2 million, or $0.12 per share, in the prior sequential quarter. Net sales for the fiscal third quarter were $106.5 million, which compares with $134.8 million in the prior sequential quarter. Net sales related to automated material handling systems (AMHS) were $68.4 million, which compares with $86.2 million in the prior sequential quarter. Net sales related to tool and fab automation solutions were $38.0 million, which compares with $48.6 million in the prior sequential quarter. Steve Schwartz, chairman and chief executive officer of Asyst, said, "In the fiscal third quarter we continued to guide the company through the current industry downturn. Gross margin for the quarter was up despite the lower volumes. We also continued to invest in product development aimed at bringing to market what we believe are truly next-generation automation solutions that integrate our industry-leading capabilities in fab-wide material handling and at the tool front-end. We recently demonstrated some of these capabilities to customers and are driving toward our next expected development milestones currently scheduled for this spring.” Michael A. Sicuro, chief financial officer, said, "Despite the decline in sales, we generated cash during the quarter, which drove a $13 million increase in our cash balances and a modest reduction in our Yen-denominated debt before currency translation. We will continue to manage expenses and cash during this downturn with the objectives of maintaining our commitment to product development and preserving our liquidity in preparation for an expected improvement in customer activity later this year. Although it is too early to call this the beginning of an uptrend, we currently expect to show improvement in AMHS bookings in our fiscal fourth quarter, driven in part by a large flat panel display win.” The company provided the following guidance for the fiscal fourth quarter ending Mar. 31, 2008: Consolidated net sales are expected to be in the range of $85-$95 million. AMHS sales are expected to be in the range of $50-$60 million, and tool and fab automation sales are expected to be approximately $35 million. Net loss in accordance with GAAP is expected to be in the range of $0.12 to $0.16 per share. This does not include the impact of any restructuring charges related to consolidation and cost reduction initiatives the company expects to implement during the quarter. Non-GAAP net loss is expected to be in the range of $0.09-$0.13 per share. In calculating non-GAAP net income per share, the company expects to exclude approximately $1.8 million, net of taxes, related to amortization of intangibles, as well as any restructuring or related charges. Note: Prior to the first quarter of fiscal 2008, the company excluded stock-based compensation expense in its calculation of non-GAAP net income per share. Accordingly, comparisons of this guidance to prior period results may not be meaningful. About Asyst Asyst Technologies, Inc. is a leading provider of integrated automation solutions that enable semiconductor and flat panel display (FPD) manufacturers to increase their manufacturing productivity and protect their investment in materials during the manufacturing process. Encompassing isolation systems, work-in-process materials management, substrate-handling robotics, automated transport and loading systems, and connectivity automation software, Asyst’s modular, interoperable solutions allow chip and FPD manufacturers, as well as original equipment manufacturers, to select and employ the value-assured, hands-off manufacturing capabilities that best suit their needs. Asyst’s homepage is http://www.asyst.com Conference Call Details The live conference call discussing these results is available today at 4:30 pm eastern time by dialing 303-262-2006. A live webcast of the conference call is publicly available on Asyst’s website at http://www.asyst.com and accessible by going to the investor relations page and clicking on the "webcast” link. For more information, including this press release, any non-GAAP financial measures that may be discussed on the webcast as well as the most directly comparable GAAP financial measures and a reconciliation of the difference between those GAAP and non-GAAP financial measures, as well as any other material financial and other statistical information contained in the webcast, please visit Asyst’s website at www.asyst.com. A replay of the Webcast may be accessed via the same procedure. In addition, a standard telephone instant replay of the conference call is available by dialing (303) 590-3000, followed by the passcode 11107728#. The audio instant replay is available from Jan. 31 at 3:30 pm Pacific Time through Feb. 14 at 11:59 pm Pacific Time. About Our Non-GAAP Financial Measures In addition to disclosing financial results calculated in accordance with GAAP, Asyst also reports adjusted net income and net income per share, referred to respectively as "non-GAAP net income” and "non-GAAP net income per share.” Non-GAAP measures exclude the effect of amortization of intangible assets, restructuring charges associated with facility and operating consolidation and severance benefits associated with headcount reductions, stock option investigation expenses, acquisition expenses related to the AMHS segment, write-off of fees from the early extinguishment of debt, fees related to the early redemption of convertible debentures, non-recurring foreign currency translation gains (losses) from inter-company loans, and the associated income tax effect related to these non-GAAP adjustments. Non-GAAP net income per share is calculated by dividing non-GAAP net income by non-GAAP weighted average shares — diluted. Asyst’s management believes the non-GAAP information is useful because it can enhance the understanding of the company’s ongoing operating performance; Asyst also uses non-GAAP reporting internally to evaluate and manage its operations. Asyst has chosen to provide this information to investors to enable them to perform comparisons of operating results in a manner similar to how Asyst analyzes its operating results internally. Management also believes that these non-GAAP financial measures may be used to facilitate comparisons of our results with those of other companies in our industry. The non-GAAP net income and non-GAAP net income per share should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Non-GAAP financial measures have limitations in that they do not reflect all of the costs associated with the operations of our business as determined in accordance with GAAP. As a result, you should not consider these measures in isolation or as a substitute for analysis of Asyst’s results as reported under GAAP. Forward Looking Statements Except for statements of historical fact, the statements in this release are forward-looking. The forward-looking statements include statements regarding future financial results; and other factors more fully detailed in the company's Annual Report on Form 10-K for the year ended March 31, 2007, and other reports filed with the Securities and Exchange Commission. Such statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include, but are not limited to: uncertainties whether the results discussed above will change as Asyst finalizes and files its financial statements; uncertainties arising from our inability to maintain effective internal control over financial reporting; the impact of lawsuits or other proceedings initiated in relation to the company's prior stock option grant practices; the volatility of semiconductor industry cycles; our ability to achieve forecasted revenues, margins and profits; failure to respond to rapid demand shifts; dependence on a few significant customers; the timing and scope of decisions by customers to transition and expand fabrication facilities and investment in fab automation equipment; our ability to maintain or expand market share in our product segments; our ability to improve gross margins through product cost reduction, volume increases, and supply chain initiatives; continued risks associated with the acceptance of new products and product capabilities; the risk that customers will delay, reduce or cancel planned projects or bookings and thus delay recognition or the amount of our anticipated revenue; competition in the semiconductor equipment industry and specifically in AMHS; failure to retain and attract key employees; and other factors more fully detailed in the company's Annual Report on Form 10-K for the year ended March 31, 2007, and other reports filed with the Securities and Exchange Commission. "Asyst” is a registered trademark of Asyst Technologies, Inc. Copyright 1993-2008, Asyst Technologies, Inc. All Rights Reserved. ASYST TECHNOLOGIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited; in thousands)     Dec. 31 March 31, 2007 2007 Assets Current assets: Cash and cash equivalents $ 78,044 $ 99,701 Accounts receivable, net 133,692 125,889 Inventories 32,983 51,797 Prepaid expenses and other   18,550   27,888   Total current assets   263,269   305,275   Long-term Assets: Property and equipment, net 25,857 25,138 Goodwill 87,704 83,723 Intangible assets, net 29,102 41,994 Other assets   14,817   9,556   Total long-term assets   157,480   160,411   Total assets $ 420,749 $ 465,686   Liabilities, minority interest & shareholders' equity Current liabilities: Short-term loans and notes payable $ 28,705 $ 1,453 Current portion of long-term debt and capital leases 6,196 58,949 Accounts payable 87,424 101,287 Accrued liabilities 63,338 83,211 Deferred margin   7,389   10,880   Total current liabilities   193,052   255,780   Long-term liabilities: Convertible notes - 86,250 Long-term debt and capital leases, net of current portion 99,586 162 Deferred tax and other long-term liabilities   29,178   28,683 Total long-term liabilities   128,764   115,095   Minority interest   137   130   Shareholders' equity   98,796   94,681   Total liabilities, minority interest and shareholders' equity $ 420,749 $ 465,686   ASYST TECHNOLOGIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, in thousands, except per share data)       Three Months Ended Nine Months Ended Dec. 31, 2007   Dec. 31, 2006   Dec. 31, 2007   Dec. 31, 2006   Net sales $ 106,475 $ 126,135 $ 362,931 $ 365,765 Cost of sales   73,914     88,019     251,344     252,082   Gross profit   32,561     38,116     111,587     113,683   Operating expenses Research and development 10,526 7,690 27,900 25,679 Selling, general and administrative 20,873 21,831 66,026 63,669 Amortization of acquired intangible assets 2,970 5,912 13,898 14,461 Restructuring and other charges   38     -     1,019     1,784   Total operating expenses   34,407     35,433     108,843     105,593     (Loss) income from operations (1,846 ) 2,683 2,744 8,090   Write-off of fees related to early extinguishment of debt and early redemption of convertible securities - - (3,135 ) - Other income (expense), net   429     (1,326 )   (1,581 )   (2,200 ) (Loss) income before income taxes and minority interest (1,417 ) 1,357 (1,972 ) 5,890 Benefit from (provision for) income taxes 562 (1,569 ) 1,203 (7,661 ) Minority interest   (12 )   (11 )   (25 )   (1,760 ) Net loss prior to cumulative effect of change in accounting principle (867 ) (223 ) (794 ) (3,531 ) Cumulative effect of change in accounting principle   -     -     -     103   Net loss $ (867 ) $ (223 ) $ (794 ) $ (3,428 )   Basic and diluted net loss per share prior to cumulative effect of change in accounting principle $ (0.02 ) $ (0.00 ) $ (0.02 ) $ (0.07 ) Cumulative effect of change in accounting principle   -     -     -     0.00   Basic and diluted net loss per share $ (0.02 ) $ (0.00 ) $ (0.02 ) $ (0.07 ) Shares used in computing basic and diluted net loss per share   49,750     49,028     49,622     48,829   ASYST TECHNOLOGIES, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (Unaudited, in thousands, except per share data)     Three Months Ended Nine Months Ended Dec. 31, 2007   Dec. 31, 2006   Dec. 31, 2007   Dec. 31, 2006   GAAP net loss $ (867) $ (223) $ (794) $ (3,428)   Non-GAAP adjustments: Amortization of acquired intangible assets 2,970 5,912 13,898 14,461 Restructuring and severance charges 38 - 1,019 2,101 Stock option investigation expenses - 951 - 3,701 Acquisition expenses related to AMHS segment - - - 4,392 Write-off of fees related to early extinguishment of debt and early redemption of convertible debentures - - 3,135 - Foreign currency translation - - 1,386 - Income tax effect of non-GAAP adjustments (1,122) (2,177) (6,136) (6,384)         Non-GAAP net income $ 1,019 $ 4,463 (1) $ 12,508 $ 14,843     Diluted net income (loss) per share GAAP $ (0.02) $ (0.00) $ (0.02) $ (0.07) Non-GAAP $ 0.02 $ 0.09 $ 0.25 $ 0.30   Weighted shares used in the per share calculation - diluted (GAAP) 49,750 49,028 49,622 48,829 Non-GAAP adjustment 165 787 534 878 Weighted shares used in the per share calculation - diluted (Non-GAAP) 49,915 49,815 50,156 49,707   (1) For the three months ended December 31, 2006, non-GAAP net income did not include $1.5M of stock-based compensation expense. This amount was previously identified as a non-GAAP adjustment in the Form 8-K earnings release for the third quarter of fiscal 2007 filed on February 6, 2007. We are no longer adjusting stock-based compensation expense as we are past the initial year of adoption.