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Lam Research Corporation
Financial Highlights for the Quarter Ended March 25, 2012
(in thousands, except per share data and percentages)
U.S. GAAP Non-GAAP
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Revenue: $ 658,961 $ 658,961
Operating Margin: 8.8% 11.1%
Net Income: $ 45,604 $ 60,621
Diluted EPS: $ 0.38 $ 0.50
In addition to U.S. Generally Accepted Accounting Principles (GAAP) results, this commentary contains non-GAAP financial measures. The Company's non-GAAP results for both the
Non-GAAP net income was
The geographic distribution of shipments and revenue during the
Region Shipments Revenue
---------------------------------------------- ------------- -------------
North America 12% 20%
Europe 8% 9%
Japan 7% 7%
Korea 48% 37%
Taiwan 14% 16%
Asia Pacific 11% 11%
Cash and cash equivalents, short-term investments and restricted cash and investments balances were
"Lam began 2012 on a strong note, delivering against our financial commitments for the March quarter while executing against the significant plans which support our strategic growth objectives," stated
Participants in the Solicitation
The directors and executive officers of
How to Find Further Information
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities, or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. In connection with the proposed merger,
Caution Regarding Forward-Looking Statements
Statements made in this press release that are not statements of historical fact are forward-looking statements and are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relate, but are not limited, to the anticipated revenue from shipments to Japanese customers, the closure of our acquisition of Novellus Systems and the benefits of that acquisition, the future capabilities of our core products, and the future opportunities for our business. Some factors that may affect these forward-looking statements include: business conditions in the consumer electronics industry, the semiconductor industry and the overall economy; the strength of the financial performance of our existing and prospective customers; the introduction of new and innovative technologies; the occurrence and pace of technology transitions and conversions; the actions of our competitors, consumers, semiconductor companies and key suppliers and subcontractors; regulatory approvals and shareholder votes related to our merger with Novellus Systems; and the success of research and development and sales and marketing programs. These forward-looking statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed by us with the
Nothing contained herein shall be deemed to be a forecast, projection or estimate of the future financial performance of
Consolidated Financial Tables Follow
LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data and percentages)
(unaudited)
Three Months Ended Nine Months Ended
----------------------------- ---------------------
December
March 25, 25, March 27, March 25, March 27,
2012 2011 2011 2012 2011
--------- --------- --------- ---------- ----------
Revenue $ 658,961 $ 583,981 $ 809,087 $1,923,378 $2,485,675
Cost of goods sold 391,814 350,014 435,068 1,138,381 1,326,897
Cost of goods sold -
restructuring and
impairments - (859) - (859) -
--------- --------- --------- ---------- ----------
Total costs of
goods sold 391,814 349,155 435,068 1,137,522 1,326,897
--------- --------- --------- ---------- ----------
Gross margin 267,147 234,826 374,019 785,856 1,158,778
Gross margin as a
percent of revenue 40.5% 40.2% 46.2% 40.9% 46.6%
Research and
development 113,448 104,024 96,880 320,031 273,710
Selling, general and
administrative 95,581 83,256 80,143 259,037 228,137
Restructuring and
impairments - - - 1,725 (5,163)
--------- --------- --------- ---------- ----------
Total operating
expenses 209,029 187,280 177,023 580,793 496,684
--------- --------- --------- ---------- ----------
Operating income 58,118 47,546 196,996 205,063 662,094
Operating margin as
a percent of
revenue 8.8% 8.1% 24.3% 10.7% 26.6%
Other income (expense),
net (3,568) (7,785) 1,663 (23,426) 1,722
--------- --------- --------- ---------- ----------
Income before
income taxes 54,550 39,761 198,659 181,637 663,816
Income tax expense 8,946 6,549 16,419 30,983 65,996
--------- --------- --------- ---------- ----------
Net income $ 45,604 $ 33,212 $ 182,240 $ 150,654 $ 597,820
========= ========= ========= ========== ==========
Net income per share:
Basic net income per
share $ 0.38 $ 0.28 $ 1.47 $ 1.25 $ 4.84
========= ========= ========= ========== ==========
Diluted net income
per share $ 0.38 $ 0.27 $ 1.45 $ 1.24 $ 4.78
========= ========= ========= ========== ==========
Number of shares used
in per share
calculations:
Basic 119,841 119,739 123,674 120,904 123,482
--------- --------- --------- ---------- ----------
Diluted 120,956 120,873 125,293 121,830 125,097
--------- --------- --------- ---------- ----------
LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March 25, December 25, June 26,
2012 2011 2011
------------- ------------- -------------
(unaudited) (unaudited) (1)
ASSETS
Cash and cash equivalents $ 1,410,267 $ 1,506,928 $ 1,492,132
Short-term investments 993,696 712,856 630,115
Accounts receivable, net 471,776 462,243 590,568
Inventories 376,126 373,130 396,607
Deferred income taxes 78,719 78,479 78,435
Other current assets 93,325 79,215 85,408
------------- ------------- -------------
Total current assets 3,423,909 3,212,851 3,273,265
Property and equipment, net 279,955 272,409 270,458
Restricted cash and investments 165,220 165,217 165,256
Deferred income taxes - 4,184 3,892
Goodwill and intangible assets 203,276 207,568 216,616
Other assets 120,903 115,918 124,380
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Total assets $ 4,193,263 $ 3,978,147 $ 4,053,867
============= ============= =============
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities $ 651,655 $ 593,605 $ 680,759
------------- ------------- -------------
Long-term debt, convertible notes,
and capital leases $ 755,427 $ 749,078 $ 738,488
Income taxes payable 115,570 115,616 113,582
Other long-term liabilities 61,469 57,104 51,193
Stockholders' equity 2,609,142 2,462,744 2,469,845
------------- ------------- -------------
Total liabilities and
stockholders' equity $ 4,193,263 $ 3,978,147 $ 4,053,867
============= ============= =============
(1) Derived from audited financial statements
LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended Nine Months Ended
------------------------------- --------------------
December
March 25, 25, March 27, March 25, March 27,
2012 2011 2011 2012 2011
---------- ---------- --------- ---------- ---------
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net income $ 45,604 $ 33,212 $ 182,240 $ 150,654 $ 597,820
Adjustments to
reconcile net income
to net cash provided
by operating
activities:
Depreciation and
amortization 22,517 22,372 18,176 66,249 54,787
Deferred income
taxes 3,723 (633) (733) 3,090 (4,555)
Restructuring and
impairment charges,
net - (859) - 866 (5,163)
Equity-based
compensation
expense 16,417 18,224 12,456 52,385 38,224
Income tax benefit
on equity-based
compensation plans (1,048) 470 15,327 81 19,492
Excess tax benefit
on equity-based
compensation plans (137) (204) (11,878) (2,292) (15,106)
Amortization of
convertible note
discount 6,750 6,671 - 20,014 -
Impairment of
investment - - - 1,724 -
(Gain) loss on
equity method
investment (208) 202 - (6) -
Other, net 1,373 881 746 3,677 (2,818)
Changes in operating
assets and
liabilities: 51,406 88,680 25,259 105,871 239
---------- ---------- --------- ---------- ---------
Net cash provided
by operating
activities 146,397 169,016 241,593 402,313 682,920
---------- ---------- --------- ---------- ---------
CASH FLOWS FROM
INVESTING ACTIVITIES:
Capital expenditures
and intangible assets (27,978) (26,682) (35,769) (70,392) (92,924)
Net sales/maturities
(purchases) of
available-for-sale
securities (282,225) (4,194) (11,068) (371,678) (36,734)
Purchase of equity
method investment - (10,740) - (10,740) -
Purchase of other
investments - - (417) - (417)
Receipt of loan
payments - 8,375 - 8,375 -
Proceeds from sale of
assets - 2,677 - 2,677 1,544
Transfer of restricted
cash and investments 3 3 (4) 23 (14)
---------- ---------- --------- ---------- ---------
Net cash used for
investing
activities (310,200) (30,561) (47,258) (441,735) (128,545)
---------- ---------- --------- ---------- ---------
CASH FLOWS FROM
FINANCING ACTIVITIES:
Principal payments on
long-term debt and
capital lease
obligations (1,024) (1,576) (1,038) (4,164) (4,449)
Excess tax benefit on
equity-based
compensation plans 137 204 11,878 2,292 15,106
Net cash received in
settlement (paid in
advance for) stock
repurchase contracts 79,189 51,005 - 55,194 (50,000)
Treasury stock
purchases (18,909) (20,642) (8,617) (111,604) (157,563)
Reissuances of
treasury stock
related to employee
stock purchase plan 7,902 - 6,521 16,760 13,676
Proceeds from issuance
of common stock 301 1,311 5,980 1,776 10,222
---------- ---------- --------- ---------- ---------
Net cash provided
by (used for)
financing
activities 67,596 30,302 14,724 (39,746) (173,008)
---------- ---------- --------- ---------- ---------
Effect of exchange
rate changes on cash (454) (1,147) 4,591 (2,697) 15,576
Net increase
(decrease) in cash
and cash equivalents (96,661) 167,610 213,650 (81,865) 396,943
Cash and cash
equivalents at
beginning of period 1,506,928 1,339,318 729,060 1,492,132 545,767
---------- ---------- --------- ---------- ---------
Cash and cash
equivalents at end of
period $1,410,267 $1,506,928 $ 942,710 $1,410,267 $ 942,710
========== ========== ========= ========== =========
Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income
(in thousands, except per share data)
(unaudited)
Three Months Three Months
Ended Ended
------------- -------------
March 25, December 25,
2012 2011
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U.S. GAAP net income $ 45,604 $ 33,212
Pre-tax non-GAAP items:
Costs associated with customer bankruptcy
filing - cost of goods sold 2,610 -
Restructuring and impairments - cost of
goods sold - (859)
Acquisition costs - operating expenses 3,195 6,860
Integration costs - operating expenses 8,441 -
Bad debt and other expenses associated with
customer bankruptcy filing - operating
expenses 640 -
Amortization of convertible note discount -
other income (expense), net 6,750 6,671
Net tax benefit on non-GAAP items (6,619) (4,871)
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Non-GAAP net income $ 60,621 $ 41,013
============= =============
Non-GAAP net income per diluted share $ 0.50 $ 0.34
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Number of shares used for diluted per share
calculation 120,956 120,873
Reconciliation of U.S. GAAP Gross Margin, Operating Expenses and Operating
Income to Non-GAAP Gross Margin,
Operating Expenses and Operating Income
(in thousands, except percentages)
(unaudited)
Three Months Three Months
Ended Ended
------------- -------------
March 25, December 25,
2012 2011
------------- -------------
U.S. GAAP gross margin $ 267,147 $ 234,826
Pre-tax non-GAAP items:
Costs associated with customer bankruptcy
filing - cost of goods sold 2,610 -
Restructuring and impairments - cost of
goods sold - (859)
------------- -------------
Non-GAAP gross margin $ 269,757 $ 233,967
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U.S. GAAP gross margin as a percentage of
revenue 40.5% 40.2%
Non-GAAP gross margin as a percentage of
revenue 40.9% 40.1%
U.S. GAAP operating expenses $ 209,029 $ 187,280
Pre-tax non-GAAP items:
Acquisition costs - operating expenses (3,195) (6,860)
Integration costs - operating expenses (8,441) -
Bad debt and other expenses associated with
customer bankruptcy filing - operating
expenses (640) -
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Non-GAAP operating expenses $ 196,753 $ 180,420
------------- -------------
Non-GAAP operating income $ 73,004 $ 53,547
============= =============
Non-GAAP operating margin as a percent of
revenue 11.1% 9.2%
Lam Research Corporation Contact:Shanye Hudson Director, Investor Relations phone: 510-572-4589 e-mail: shanye.hudson@lamresearch.com
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