ATMI Atmi Inc. (MM)

ATMI Reports Third Quarter 2004 Results DANBURY, Conn., Oct. 20 /PRNewswire-FirstCall/ -- ATMI, Inc. (NASDAQ:ATMI), a supplier of materials and materials packaging to the world's leading semiconductor manufacturers, today announced revenues of $64.4 million for the third quarter of 2004, an increase of 52% from $42.3 million in the third quarter of 2003, and an increase of 6% over $61.0 million in the second quarter of 2004. Continuing operations in the third quarter generated income of $6.4 million, or $0.20 per diluted share. In the third quarter of 2003, continuing operations generated a loss of $4.7 million, or $0.16 per diluted share, including $4.2 million in special charges related to asset impairments as a result of transitioning product lines to a new manufacturing facility, a write down in the Company's strategic investment portfolio, and a charge related to acquired in-process research and development. In the second quarter of 2004, continuing operations generated income of $5.8 million, or $0.18 per diluted share. Overall, net income for the third quarter was $10.6 million, or $0.34 per diluted share, which includes earnings of $0.03 per diluted share from the performance of discontinued operations, and a gain of $0.11 per diluted share from sale of the epitaxial services and Emosyn discontinued operations. For the third quarter of 2003, net loss was $10.8 million, or $0.36 per diluted share, which included a loss of $0.20 per diluted share from the performance of discontinued operations. Net income for the second quarter of 2004 was $7.9 million, or $0.25 per diluted share, including $0.06 per diluted share from the performance of discontinued operations and a gain of $0.01 per diluted share related to the sale of the life safety systems and fab services discontinued operations. For the nine months ended September 30, 2004, revenue from continuing operations totaled $181.4 million, an increase of 52% compared with $119.3 million for the same period in 2003. Income from continuing operations was $16.2 million, or $0.51 per diluted share, compared with a loss of $3.6 million, or $0.12 per diluted share, in the same period last year, including $5.1 million in special charges related to asset impairments as a result of transitioning product lines to a new manufacturing facility, a write down in the Company's strategic investment portfolio, and a charge related to acquired in-process research and development. Overall net income for the first nine months of 2004 was $24.6 million, or $0.78 per diluted share, which includes $0.12 per diluted share from the performance of discontinued operations, and a gain of $0.15 per diluted share from sale of five of the six discontinued operations. For the first nine months of 2003, net loss was $15.2 million, or $0.50 per diluted share, which included a loss of $0.38 from the performance of discontinued operations. Doug Neugold, ATMI President and Chief Operating Officer, said, "Our third quarter performance is an example of what we believe our wafer start-driven business model can achieve in a difficult environment. While we, like the rest of the industry, have some exposure to capital equipment push-outs and reductions in wafer starts, those declines for the most part represent trailing edge technologies. In ATMI's case, this is offset by the growth in emerging technology nodes -- 130 nanometer and below -- where we realize more than 30% of our business. Our customers are aggressively ramping these processes, a trend we expect to continue." Dan Sharkey, ATMI Chief Financial Officer, said, "ATMI's materials product lines showed continued growth during the third quarter. Gross margins sequentially improved to 50.6%, in an environment where volume manufacturing is ramping to meet additional copper-related materials demand beyond our customers' initial forecasts and our local inventories. Proceeds from sales of our discontinued epitaxial services and Emosyn smart card businesses added over $50 million in cash to our balance sheet during the quarter. We continue to actively pursue the disposal of our abatement systems business, our only remaining discontinued operation, which we hope to complete by the end of 2004." Gene Banucci, ATMI Chairman and Chief Executive Officer, said, "ATMI's third quarter is distinct directionally from those of many participants in the semiconductor supply chain. We expect pressures on the supply chain to continue in the fourth quarter as wafer start growth goes negative from essentially flat in the third quarter. Our best estimate at present is that wafer starts will shrink 7-10% during the fourth quarter and return to a growth mode in the first quarter of 2005. As far as ATMI is concerned, we anticipate that our copper wafer start-driven base of business will enable us to mitigate much of the impact of the global trend." ATMI provides specialty materials and materials packaging to the worldwide semiconductor industry. For more information, please visit http://atmi.com/ . Statements contained herein that relate to ATMI's future performance, including, without limitation, statements with respect to ATMI's anticipated results of operations or level of business for 2004, 2005, or any other future period, are forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on current expectations only and are subject to certain risks, uncertainties, and assumptions, including, but not limited to: changes in semiconductor industry growth or ATMI's markets; competition, problems, or delays developing and commercializing new products; problems or delays in integrating acquired operations and businesses into ATMI; problems or delays associated with any restructuring activity, including resolution of the various discontinued elements of ATMI's Technologies segment; and other factors discussed in ATMI's filings with the Securities and Exchange Commission. Such risks and uncertainties could cause actual results to differ from those projected. ATMI undertakes no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events or otherwise. Note: A conference call (800.289.0544) discussing financial results will begin at 11:00 a.m. Eastern time, October 20th, 2004. A replay (888.203.1112, PIN 732967) of the call will be available for 48 hours. An audio webcast of the conference call will be available for 30 days on http://atmi.com/. ATMI, INC. SUMMARY STATEMENTS OF OPERATION (in thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, 2004 2003 2004 2003 Revenues $64,423 $42,260 $181,420 $119,282 Cost of revenues 31,843 25,691 90,934 64,305 Gross profit 32,580 16,569 90,486 54,977 Operating expenses R & D 5,224 5,335 14,751 13,809 S, G, & A 16,687 13,882 48,567 39,084 Restructuring & other charges -- 1,731 -- 1,731 21,911 20,948 63,318 54,624 Operating income (loss) 10,669 (4,379) 27,168 353 Other expense, net (981) (3,629) (2,564) (7,046) Income (loss) before taxes 9,688 (8,008) 24,604 (6,693) Income taxes (benefit) 3,293 (3,352) 8,426 (3,069) Income (loss) from continuing operations 6,395 (4,656) 16,178 (3,624) Income (loss) from operations of discontinued operations 755 (6,117) 3,589 (11,541) Gain on disposal of discontinued operations 3,468 -- 4,825 -- Net income (loss) $10,618 ($10,773) $24,592 ($15,165) Diluted earnings (loss) per share from continuing operations $0.20 ($0.16) $0.51 ($0.12) Diluted earnings (loss) per share from operations of discontinued operations $0.03 ($0.20) $0.12 ($0.38) Diluted earnings per share from gain on disposal of discontinued operations $0.11 -- $0.15 -- Diluted earnings (loss) per share $0.34 ($0.36) $0.78 ($0.50) Weighted average shares 31,603 30,214 31,668 30,109 outstanding ATMI, INC. SUMMARY BALANCE SHEETS (in thousands) Balance Sheet Highlights September 30, December 31, 2004 2003 Assets Cash & marketable securities $225,805 $128,700 Accounts receivable, net 39,844 38,439 Inventory, net 34,313 21,564 Assets held for sale 13,513 84,736 Other current assets 23,256 16,280 Total current assets 336,731 289,719 Fixed assets, net 68,058 64,673 Other assets 57,616 60,050 Total assets $462,405 $414,442 Liabilities and stockholders' equity Accounts payable $16,398 $11,743 Short-term debt 680 1,047 Liabilities held for sale 7,979 7,196 Other current liabilities 36,017 24,799 Total current liabilities 61,074 44,785 Long-term debt 115,101 115,290 Other long-term liabilities 204 116 Stockholders' equity 286,026 254,251 Total liabilities & stockholders' equity $462,405 $414,442 DATASOURCE: ATMI, Inc. CONTACT: Dean Hamilton of ATMI, +1-203-207-9349 Direct, or +1-203-794-1100, ext. 4202, Web site: http://www.atmi.com/

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