PITTSBURGH, Aug. 5 /PRNewswire-FirstCall/ --
FlashResults
II-VI Incorporated IIVI
(Numbers in Thousands, Except
Per Share Data)
4th quarter ended 4th quarter ended
6/30/2008 YTD 6/30/2007 YTD
Sales $91,809 316,191 69,843 $254,684
Net Income $14,838 64,268 11,309 $37,966
Average Shares 30,558 30,489 30,385 30,288
EPS $0.49 $2.11 $0.37 $1.25
II-VI Incorporated (Nasdaq: IIVI) today reported results for its fourth
quarter and fiscal year ended June 30, 2008.
As previously announced on April 4, 2008, the Company intends on selling
its x-ray and gamma-ray radiation sensor business, eV PRODUCTS, Inc., which
operates as a business within the Compound Semiconductor Group. Results for
all periods presented reflect the presentation of eV PRODUCTS as a
discontinued operation.
Bookings from continuing operations for the quarter increased 31% to
$92,159,000 compared to $70,445,000 in the fourth quarter of last fiscal year.
Bookings from continuing operations for the year ended June 30, 2008 increased
30% to a record $345,316,000 from $266,602,000 last fiscal year. Bookings are
defined as customer orders received that are expected to be converted into
revenues during the next 12 months.
Revenues from continuing operations for the quarter increased 31% to a
record $91,809,000 from $69,843,000 in the fourth quarter of last fiscal year.
Revenues from continuing operations for the year ended June 30, 2008 increased
24% to a record $316,191,000 from $254,684,000 last fiscal year.
For the quarter ended June 30, 2008, net earnings from continuing
operations were $15,351,000 or $0.50 per share-diluted compared with
$11,356,000 or $0.37 per share-diluted in the fourth quarter of last fiscal
year. After giving effect to a net loss from the discontinued operation
($513,000 or $0.02 per share-diluted for the quarter compared to $47,000 or
$0.00 per share-diluted in the fourth quarter of last fiscal year),
consolidated net earnings for the quarter were $14,838,000 or $0.49 per
share-diluted compared with $11,309,000 or $0.37 per share-diluted in the
fourth quarter of last fiscal year.
For the year ended June 30, 2008, net earnings from continuing operations
were $65,693,000 or $2.16 per share-diluted compared with $38,442,000 or $1.27
per share-diluted last fiscal year. After giving effect to a net loss from the
discontinued operation ($1,425,000 or $0.05 per share-diluted for the year
compared to $476,000 or $0.02 per share-diluted in the same period one year
ago), consolidated net earnings were $64,268,000 or $2.11 per share-diluted
compared with $37,966,000 or $1.25 per share-diluted last fiscal year. Net
earnings for the year ended June 30, 2008 includes an after-tax gain of $0.52
per share-diluted on the sale of an equity investment.
Francis J Kramer, president and chief executive officer said, 'We are very
pleased to report solid performance for the quarter and fiscal year ended June
30, 2008. Pacific Rare Specialty Metals & Chemicals, Inc. (PRM) completed its
first year with II-VI and contributed strong bookings, revenue and earnings.
PRM's performance helped the Military and Materials segment to more than
double bookings and segment earnings on an 86% increase in revenues. In the
Compound Semiconductor Group, Marlow Industries, Inc. posted admirable quarter
and fiscal year operating results; this business continues to benefit from
growing worldwide product acceptance and increasing use of its Vietnam
manufacturing base. Our Infrared Optics segment improved its operating and
financial performance during the quarter and is focused on another year of
double-digit organic growth. We expect fiscal year 2009 will be another good
year for the Company as we benefit from both a strong order backlog and strong
balance sheet. We have increased our fiscal year 2009 guidance from the
initial guidance we gave on April 22, 2008 for this fiscal year.'
Segment Information from Continuing Operations
The following segment information includes segment earnings from
continuing operations (defined as earnings from continuing operations before
income taxes, interest expense and other expense or income, net). Management
believes segment earnings from continuing operations are a useful performance
measure because they reflect the results of segment performance over which
management has direct control.
Three Months Ended Year Ended
June 30, June 30,
%
Increase %
2008 2007 (Decrease) 2008 2007 Increase
Bookings:
Infrared Optics $43,607 $35,716 22% $161,732 $134,569 20%
Near-Infrared
Optics 23,359 8,097 188% 65,932 49,518 33%
Military and
Materials 15,533 9,984 56% 61,871 30,341 104%
Compound
Semiconductor
Group 9,660 16,648 (42)% 55,781 52,174 7%
Total Bookings $92,159 $70,445 31% $345,316 $266,602 30%
Revenues:
Infrared Optics $43,372 $35,120 23% $151,911 $132,772 14%
Near-Infrared
Optics 15,269 15,148 1% 58,689 50,253 17%
Military and
Materials 14,316 7,394 94% 50,507 27,108 86%
Compound
Semiconductor
Group 18,852 12,181 55% 55,084 44,551 24%
Total Revenues $91,809 $69,843 31% $316,191 $254,684 24%
Segment Earnings:
Infrared Optics $10,801 $9,248 17% $36,189 $35,663 1%
Near-Infrared
Optics 3,442 2,458 40% 11,886 6,805 75%
Military and
Materials 1,882 714 164% 7,065 2,523 180%
Compound
Semiconductor
Group 2,266 1,498 51% 6,522 3,963 65%
Total Segment
Earnings $18,391 $13,918 32% $61,662 $48,954 26%
Investment in Fuxin Electronics
As previously announced on July 28, 2008, the Company completed an
additional investment in Guangdong Fuxin Electronic Technology Company
(Fuxin), based in Guangdong Province, China. This additional investment, made
in July 2008, was for approximately $5 million and increased the Company's
total equity ownership in Fuxin to 20%. Fuxin is a leader in
thermoelectric-based consumer appliances. The Company's Marlow Industries
subsidiary is the world leader in high quality, high reliability and high
performance thermoelectric cooling technology.
Outlook
For the first fiscal quarter ending September 30, 2008, the Company
currently forecasts revenues from continuing operations to range from $84.0
million to $86.0 million and earnings per share from continuing operations to
range from $0.41 to $0.44. Comparable results for the quarter ended September
30, 2007 were revenues from continuing operations of $71.1 million and
earnings per share from continuing operations of $0.33. The first fiscal
quarter tends to be the lowest revenue quarter of the fiscal year due to
slight seasonality of European sales. For the fiscal year ending June 30,
2009, the Company expects revenues from continuing operations to range from
$347 million to $352 million and earnings per share from continuing operations
to range from $1.75 to $1.80. Results for the year ended June 30, 2008 were
revenues from continuing operations of $316 million and earnings per share
from continuing operations of $1.63 excluding the after-tax gain on the sale
of equity investment of $0.52 per share.
As discussed in more detail below, actual results may differ from these
forecasts due to various factors including, but not limited to, changes in
product demand, competition and general economic conditions.
Webcast Information
The Company will host a conference call at 9:00 a.m. Eastern Time on
Tuesday, August 5, 2008 to discuss these results. The conference call will be
broadcast live over the internet and can be accessed by all interested parties
from the Company's web site at http://www.ii-vi.com as well as at
http://www.videonewswire.com/event.asp?id=50294. Please allow extra time prior
to the call to visit the site and, if needed, to download the media software
required to listen to the internet broadcast. A replay of the webcast will be
available for 2 weeks following the call.
About II-VI Incorporated
II-VI Incorporated, a worldwide leader in engineered materials and
components, is a vertically-integrated manufacturing company that creates and
markets products for a diversified customer base including industrial
manufacturing, military and aerospace, high-power electronics and
telecommunications, and thermoelectric applications. Headquartered in
Saxonburg, Pennsylvania, with manufacturing, sales, and distribution
facilities worldwide, the Company produces numerous crystalline compounds
including zinc selenide for infrared laser optics, silicon carbide for
high-power electronic and microwave applications, and bismuth telluride for
thermoelectric coolers.
In the Company's infrared optics business, II-VI Infrared manufactures
optical and opto-electronic components for industrial laser and thermal
imaging systems, and HIGHYAG Lasertechnologie GmbH (HIGHYAG) manufactures
fiber-delivered beam transmission systems and processing tools for industrial
lasers. In the Company's near-infrared optics business, VLOC manufactures
near-infrared and visible light products for industrial, scientific, military
and medical instruments and laser gain materials and products for solid-state
YAG and YLF lasers. In the Company's military & materials business, Exotic
Electro-Optics (EEO) manufactures infrared products for military applications,
and Pacific Rare Specialty Metals & Chemicals (PRM) produces and refines
selenium and tellurium materials. In the Company's Compound Semiconductor
Group, the Wide Bandgap Materials (WBG) group manufactures and markets single
crystal silicon carbide substrates for use in the solid-state lighting,
wireless infrastructure, RF electronics and power switching industries; the
Marlow Industries, Inc. subsidiary designs and manufactures thermoelectric
cooling and power generation solutions for use in defense, space, photonics,
telecommunications, medical, consumer and industrial markets; and, the
Worldwide Materials Group (WMG) provides expertise in materials development,
process development, and manufacturing scale up.
This press release contains forward-looking statements based on certain
assumptions and contingencies that involve risks and uncertainties. The
forward-looking statements are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995 and relate to the
Company's performance on a going-forward basis. The forward-looking statements
in this press release involve risks and uncertainties, which could cause
actual results, performance or trends to differ materially from those
expressed in the forward-looking statements herein or in previous disclosures.
The Company believes that all forward-looking statements made by it have a
reasonable basis, but there can be no assurance that management's
expectations, beliefs or projections as expressed in the forward-looking
statements will actually occur or prove to be correct. In addition to general
industry and economic conditions, factors that could cause actual results to
differ materially from those discussed in the forward-looking statements in
this press release include, but are not limited to: (i) the failure of any one
or more of the assumptions stated above to prove to be correct; (ii) the risks
relating to forward-looking statements and other 'Risk Factors' discussed in
the Company's Annual Report on Form 10-K for the fiscal year ended June 30,
2007; (iii) purchasing patterns from customers and end-users; (iv) timely
release of new products, and acceptance of such new products by the market;
(v) the introduction of new products by competitors and other competitive
responses; and/or (vi) the Company's ability to devise and execute strategies
to respond to market conditions.
II-VI Incorporated and Subsidiaries
Condensed Consolidated Statements of Earnings (Unaudited)
(000 except per share data)
Three Months Ended Year Ended
June 30, June 30,
2008 2007 2008 2007
Revenues
Net sales $89,172 $66,475 $303,902 $243,488
Contract research
and development 2,637 3,368 12,289 11,196
Total Revenues 91,809 69,843 316,191 254,684
Costs, Expenses, Other
Expense (Income)
Cost of goods sold $51,907 $38,554 $176,541 $138,212
Contract research
and development 2,053 2,402 9,444 8,256
Internal research
and development 2,346 1,811 7,734 5,819
Selling, general
and administrative 17,112 13,158 60,810 53,443
Interest expense 26 134 242 1,007
Other (income), net (200) (675) (2,754) (2,736)
Gain on sale of equity
investment, pre-tax -- -- (26,455) --
Total Costs,
Expenses, Other
Expense (Income) 73,244 55,384 225,562 204,001
Earnings from Continuing
Operations Before
Income Taxes 18,565 14,459 90,629 50,683
Income Taxes 3,214 3,103 24,936 12,241
Earnings from
Continuing Operations 15,351 11,356 65,693 38,442
Loss from Discontinued
Operation, Net of
Income Tax Benefit $(513) $(47) $(1,425) $(476)
Net Earnings 14,838 11,309 64,268 37,966
Diluted Earnings Per
Share:
Continuing operations $0.50 $0.37 $2.16 $1.27
Discontinued
operation $(0.02) $(0.00) $(0.05) $(0.02)
Consolidated $0.49 $0.37 $2.11 $1.25
Average Shares
Outstanding - Diluted 30,558 30,385 30,489 30,288
Average Shares
Outstanding - Basic 29,781 29,555 29,691 29,426
II-VI Incorporated and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(000)
June 30, June 30,
2008 2007
Assets
Current Assets
Cash and cash equivalents $69,835 $32,618
Marketable securities 3,000 --
Accounts receivable, net 55,866 44,964
Inventories 69,642 57,898
Assets held-for-sale 8,229 8,004
Deferred income taxes 8,943 9,172
Prepaid and other current assets 10,754 2,313
Total Current Assets 226,269 154,969
Property, Plant & Equipment, net 86,331 82,666
Goodwill 26,531 24,489
Other Intangible Assets, net 13,268 13,920
Investments 3,665 6,982
Other Assets 4,862 4,898
Total Assets $360,926 $287,924
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable $16,412 $13,812
Accruals and other current liabilities 28,136 28,860
Liabilities held-for-sale 1,977 1,607
Current portion of long-term debt -- 55
Total Current Liabilities 46,525 44,334
Long-Term Debt-less current portion 3,791 14,940
Deferred Income Taxes 5,210 5,502
Other Liabilities 15,274 3,708
Total Liabilities 70,800 68,484
Shareholders' Equity 290,126 219,440
Total Liabilities and Shareholders'
Equity $360,926 $287,924
II-VI Incorporated and Subsidiaries
Other Selected Financial Information
($000 except per share data)
The following other selected financial information for continuing
operations includes earnings from continuing operations before interest,
income taxes, depreciation and amortization (EBITDA). Management believes
EBITDA from continuing operations is a useful performance measure because it
reflects operating profitability before certain non-operating expenses and
non-cash charges.
Other Selected Financial Information for Continuing Operations
Three Months Ended Year Ended
June 30, June 30,
2008 2007 2008 2007
EBITDA $22,081 $19,026 $106,395 $67,539
EBITDA excluding pre-tax
gain on sale of equity
investment $22,081 $19,026 $79,940 $67,539
Cash paid for capital
expenditures $5,451 $6,254 $17,855 $19,384
Net borrowings (payments)
on indebtedness $-- $798 $(11,749) $(15,992)
Incentive stock option
and performance
share compensation
expense, pre-tax $1,058 $1,095 $3,980 $3,358
Cash paid for shares
repurchased through
the Company's stock
repurchase program $-- $-- $5,865 $502
Shares repurchased
through the Company's
stock repurchase program -- -- 186,400 19,500
Reconciliation of Segment Three Months Ended Year Ended
Earnings and EBITDA to Earnings June 30, June 30,
Before Income Taxes 2008 2007 2008 2007
Total Segment Earnings
from Continuing
Operations $18,391 $13,918 $61,662 $48,954
Interest expense 26 134 242 1,007
Other (income), net (200) (675) (2,754) (2,736)
Gain on sale of equity
investment, pre-tax -- -- (26,455) --
Earnings from
Continuing Operations
before income taxes $18,565 $14,459 $90,629 $50,683
EBITDA from Continuing
Operations $22,081 $19,026 $106,395 $67,539
Interest expense 26 134 242 1,007
Depreciation and
amortization 3,490 4,433 15,524 15,849
Earnings from
Continuing Operations
before income taxes $18,565 $14,459 $90,629 $50,683
SOURCE II-VI Incorporated
