<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
/X/ Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the Quarter Ended March 31, 1998
or
/ / Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from __________ to ___________.
Commission File Number 0-11370
CERPROBE CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 86-0312814
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1150 NORTH FIESTA BOULEVARD, GILBERT, ARIZONA 85233
(Address of principal executive offices) (Zip Code)
(602) 333-1500
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/ No / /
As of May 1, 1998, there were 8,107,279 shares of the registrant's
common stock outstanding.
<PAGE> 2
CERPROBE CORPORATION
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1998
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
Page
ITEM 1. FINANCIAL STATEMENTS:
Condensed Consolidated Balance Sheets -
March 31, 1998 and December 31, 1997..................................3
Condensed Consolidated Statements of Operations -
Three Months Ended March 31, 1998 and 1997............................4
Condensed Consolidated Statements of Cash Flows -
Three Months Ended March 31, 1998 and 1997............................5
Notes to Condensed Consolidated Financial Statements..................6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS...................................8
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.....................................12
SIGNATURE.....................................................................13
2
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CERPROBE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
ASSETS 1998 1997
------------ ------------
(UNAUDITED)
<S> <C> <C>
Current assets:
Cash and short-term investments $ 28,873,747 $ 30,347,173
Accounts receivable, net of allowance of $273,000
in 1998 and $292,000 in 1997 12,394,774 10,341,428
Inventories, net 10,142,221 8,483,141
Accrued interest receivable 116,926 202,939
Prepaid expenses 878,135 388,692
Income taxes receivable -- 624,574
Deferred tax asset 599,117 518,778
------------ ------------
Total current assets 53,004,920 50,906,725
Property, plant and equipment, net 16,808,227 15,141,902
Intangibles, net 2,406,122 2,396,301
Other assets 986,220 1,009,916
------------ ------------
Total assets $ 73,205,489 $ 69,454,844
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,581,301 $ 4,346,039
Accrued expenses 3,950,380 3,286,304
Current portion of notes payable 930,889 139,661
Current portion of capital leases 609,771 629,798
------------ ------------
Total current liabilities 10,072,341 8,401,802
Notes payable, less current portion 112,157 148,985
Capital leases, less current portion 1,030,244 1,165,722
Deferred tax liability 361,721 377,701
Other liabilities 14,843 16,700
------------ ------------
Total liabilities 11,591,306 10,110,910
------------ ------------
Minority interest 188,926 132,437
Commitments and contingencies
Stockholders' equity:
Common stock, $.05 par value; authorized 10,000,000
shares; issued and outstanding 8,104,979 shares at
March 31,1998 and 8,097,979 shares at December 31, 1997 405,249 404,899
Additional paid-in capital 55,014,521 55,136,307
Retained earnings 6,347,071 4,001,642
Foreign currency translation adjustment (341,584) (331,351)
------------ ------------
Total stockholders' equity 61,425,257 59,211,497
------------ ------------
Total liabilities and stockholders' equity $ 73,205,489 $ 69,454,844
============ ============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
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CERPROBE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
--------------------------------
1998 1997
------------ ------------
<S> <C> <C>
Net sales $ 24,590,337 $ 15,899,092
Costs of goods sold 14,413,024 9,394,372
------------ ------------
Gross profit 10,177,313 6,504,720
------------ ------------
Expenses:
Selling, general and administrative 5,655,760 4,172,449
Engineering and product development 830,087 453,319
Acquisition related expenses -- 6,164,156
------------ ------------
Total expenses 6,485,847 10,789,924
------------ ------------
Operating income (loss) 3,691,466 (4,285,204)
------------ ------------
Other income (expense):
Interest income 284,735 35,160
Interest expense (60,933) (134,611)
Other income (expense), net (6,531) 58,891
------------ ------------
Total other income (expense) 217,271 (40,560)
------------ ------------
Income (loss) before income taxes and
minority interest 3,908,737 (4,325,764)
Minority interest share of (income) loss 17,730 (12,569)
------------ ------------
Income (loss) before income taxes 3,926,467 (4,338,333)
Provision for income taxes (1,581,037) (556,300)
------------ ------------
Net income (loss) $ 2,345,430 $ (4,894,633)
============ ============
Net income (loss) per share:
Basic $ 0.29 $ (0.78)
============ ============
Weighted average number of common
shares outstanding 8,101,001 6,292,662
============ ============
Diluted $ 0.28 $ (0.78)
============ ============
Weighted average number of common and
common equivalent shares outstanding 8,482,243 6,292,662
============ ============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
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CERPROBE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended March 31,
--------------------------------
1998 1997
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 2,345,430 $ (4,894,633)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization 1,116,749 772,390
Purchased research and development -- 5,664,156
Loss on sale of equipment 107,186 426
Tax benefit from exercise of nonqualified stock options 9,000 --
Deferred income taxes (96,319) 92,041
Provision for losses on accounts receivable 6,000 6,000
Provision for obsolete inventory 40,000 (20,868)
Income (loss) applicable to minority interest in consolidated subsidiaries (17,730) 12,569
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable (2,059,346) (1,769,688)
Inventories (1,699,080) 329,738
Prepaid expenses and other assets (341,480) 142,808
Income taxes receivable 624,574 539,904
Accounts payable and accrued expenses 433,258 (491,751)
Accrued income taxes 466,080 113,490
Other liabilities (1,857) 52,400
------------ ------------
Net cash provided by operating activities 932,465 548,982
------------ ------------
Cash flows from investing activities:
Purchase of property, plant and equipment (2,900,082) (1,405,273)
Investment in CRPB Investors, L.L.C. 35,965 (607)
Supplemental acquisition costs for CompuRoute -- (80,102)
Purchase of SVTR, net of cash acquired -- (2,565,697)
Proceeds from sale of equipment -- 717
Payment of notes receivable 250,000
------------ ------------
Net cash used in investing activities (2,864,117) (3,800,962)
------------ ------------
Cash flows from financing activities:
Issuance of (payments on) notes payable and capital leases 598,895 (582,535)
Expenses from issuance of common stock (176,436) --
Net proceeds from exercise of stock options 46,000 154,332
------------ ------------
Net cash provided by (used in) financing activities 468,459 (428,203)
------------ ------------
Effect of exchange rates on cash and short-term investments (10,233) (44,268)
------------ ------------
Net decrease in cash and short-term investments (1,473,426) (3,724,451)
Cash and short-term investments, beginning of period 30,347,173 5,564,557
------------ ------------
Cash and short-term investments, end of period $ 28,873,747 $ 1,840,106
============ ============
Supplemental schedule of non-cash financing activities
Equipment acquired under capital leases $ -- $ 4,144
------------ ------------
Supplemental disclosures of cash flow information:
Interest paid $ 60,933 $ 134,611
------------ ------------
Income taxes paid $ 322,500 $ 18,096
------------ ------------
Supplemental disclosures of non-cash investing activities:
The Company acquired Silicon Valley Test & Repair, Inc. for $5.7 million in
the period ended March 31, 1997. The purchase price was allocated to the
assets acquired and the liabilities assumed based on their fair values as
indicated in the notes to the condensed consolidated financial
statements. A summary of the acquisition is as follows:
Purchase price $ 5,715,263
Less cash acquired (285,316)
Common stock issued (2,864,250)
============
Cash invested $ 2,565,697
============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
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CERPROBE CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(1) BASIS OF PREPARATION
The accompanying condensed consolidated financial statements as of
March 31, 1998 and for the three months ended March 31, 1998 and March
31, 1997 are unaudited and reflect all adjustments (consisting only of
normal recurring adjustments) which are, in the opinion of management,
necessary for a fair presentation of financial position and operating
results for the interim periods. The condensed consolidated balance
sheet as of December 31, 1997 was derived from the audited consolidated
financial statements at such date.
Pursuant to accounting requirements of the Securities and Exchange
Commission applicable to quarterly reports on Form 10-Q, the
accompanying condensed consolidated financial statements and notes do
not include all disclosures required by generally accepted accounting
principles for complete financial statements. Accordingly, these
statements should be read in conjunction with Cerprobe Corporation's
(the "Company") annual financial statements and notes thereto included
in the Company's Annual Report on Form 10-K for the year ended December
31, 1997.
Results of operations for interim periods are not necessarily
indicative of those to be achieved for full fiscal years.
PRINCIPLES OF CONSOLIDATION
The condensed consolidated financial statements include the accounts of
Cerprobe Corporation and its subsidiaries: Cerprobe Europe Limited,
Cerprobe Asia Holdings PTE LTD, CompuRoute, Inc., SVTR, Inc.,
Upsys-Cerprobe, L.L.C., and Cobra Venture Management, Inc.
Cerprobe Asia Holdings PTE LTD together with Asian investors, formed
Cerprobe Asia PTE LTD in 1995. Cerprobe Asia Holdings PTE LTD is a 60%
(70% prior to August 18, 1997) owner of Cerprobe Asia PTE LTD. Cerprobe
Asia PTE LTD created wholly owned subsidiaries, Cerprobe Singapore PTE
LTD and Cerprobe Taiwan Co. LTD, to operate full service sales and
manufacturing plants. Cerprobe Singapore became operational in April
1996 and Cerprobe Taiwan in January 1997. All significant intercompany
transactions have been eliminated in consolidation.
On January 15, 1997, the Company acquired all of the outstanding stock
of STVR, Inc., ("SVTR"), a company that refurbishes, reconfigures, and
services wafer probing equipment. Accordingly, the condensed
consolidated financial statements include SVTR's activities since the
date of acquisition.
On March 17, 1997, the Company entered into a joint venture with Upsys
Reseau Eurisys ("Upsys"), a French company owned by IBM and GAME CoGEMA
Group, a French testing and engineering company. The joint venture,
called Upsys-Cerprobe, L.L.C., assembles and repairs the Cobra Probe in
Arizona for distribution by Cerprobe throughout the United States and
Asia. Cerprobe owns 55% of the joint venture and Upsys owns 45%.
Accordingly, the condensed consolidated
6
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financial statements include the activities of Upsys-Cerprobe, L.L.C.
since the date of the joint venture. The Company manages the joint
venture and established a wholly owned subsidiary called Cobra Venture
Management, Inc. to function as manager of Upsys-Cerprobe, L.L.C.
(2) COMMITMENTS AND CONTINGENCIES
LETTER OF INTENT
On April 20, 1998, Cerprobe Corporation signed a letter of intent to
purchase the Probe Card operation of Upsys for approximately $8,000,000
in cash.
EMPLOYEE STOCK PURCHASE PLAN
On December 17, 1997, the Board of Directors approved, subject to
shareholder approval, the Employee Stock Purchase Plan (the "Plan").
Under the Plan, the Company may from time to time purchase shares on
the open market or through negotiated transactions, which shares would
be held for purchases by employees under the Plan.
The Company expects that it may acquire approximately 30,000 shares
over the next 12 months to satisfy its current obligations under the
Plan. The Plan provides for purchases by employees of up to 150,000
shares.
(3) COMPREHENSIVE INCOME
The Company adopted Statement of Financial Accounting Standards No.
130, "Reporting Comprehensive Income" (SFAS 130), effective January 1,
1998. SFAS 130 establishes standards for the reporting and presentation
of comprehensive income and its components in financial statements.
Comprehensive income encompasses net income and "other comprehensive
income," which includes all other non-owner transactions and events
which change stockholders' equity.
The Company recognized comprehensive income of $2,339,290 for the three
months ended March 31, 1998 and comprehensive loss of $(4,921,194) for
the three months ended March 31, 1997 as follows.
<TABLE>
<CAPTION>
Three months ended March 31,
------------------------------
1998 1997
----------- -----------
<S> <C> <C>
Net income (loss) $ 2,345,430 $(4,894,633)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment (10,233) (44,268)
Tax benefit from foreign currency translation 4,093 17,707
----------- -----------
Net other comprehensive loss (6,140) (26,561)
----------- -----------
Comprehensive income (loss) $ 2,339,290 $(4,921,194)
=========== ===========
</TABLE>
7
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis should be read in conjunction
with the Selected Consolidated Financial Data and the Consolidated Financial
Statements and related Notes thereto of the Company appearing in the Company's
Annual Report on Form 10-K for the year ended December 31, 1997.
OVERVIEW
Cerprobe offers comprehensive solutions for semiconductor test
integration and is a leading manufacturer of probe cards, ATE interface
assemblies, and ATE test boards. The Company's products and services enable
semiconductor manufacturers to test integrated circuits ("ICs") in wafer form
and as packaged ICs.
The Company has grown substantially over the last five years as the
Company has increased its market share and has benefited from the substantial
growth in the worldwide demand for ICs. Net sales have increased from $11.2
million for 1993 to $77.1 million for 1997, representing an average annualized
growth rate of approximately 62%. Similarly, the Company's net income has
increased from $1.5 million for 1993 to $6.7 million for 1997 (before a one-time
charge for purchased research and development of $4.5 million and SVTR moving
expense of $300,000, net of tax benefit of $200,000, which together reduced net
income to $1.9 million). Until 1995, substantially all of the Company's growth
was from the existing probe card product line.
Beginning with the April 1995 acquisition of Fresh Test Technology
Corporation ("Fresh Test"), acquisitions have contributed to the Company's
growth. Fresh Test expanded the Company's product line to include ATE interface
assemblies. The Company acquired CompuRoute in December 1996, which enabled the
Company to offer ATE test boards. The Company acquired SVTR in January 1997,
which added wafer prober remanufacturing and upgrading services. Net sales from
these acquired products and services together approximated $28 million, $7
million, and $4 million in years 1997, 1996, and 1995, respectively. In May
1997, the Company entered into a joint venture with Upsys Reseau Eurisys
("Upsys"), a French testing and engineering company owned by IBM and GAME COGEMA
Group, a French testing and engineering company. The joint venture, called
Upsys-Cerprobe, L.L.C., assembles and repairs the Cobra probe card for
distribution by the Company in the United States and Asia. The Company believes
the Cobra probe is well-suited for area array IC and multiple memory IC testing,
both new markets for the Company. In April 1998, the Company signed a letter of
intent to purchase the Probe Card operations of Upsys for approximately
$8,000,000 in cash.
The Company believes that it is positioned to continue its growth as a
result of its strength in designing, producing, and delivering, on a timely and
cost-efficient basis, a broad range of custom or customized, high quality test
products and services for semiconductor manufacturers in the United States,
Europe, and Asia. There can be no assurance that the Company can continue its
growth. The Company maintains regional full service facilities in Arizona,
California, and Texas as well as sales offices in Colorado, Florida,
Massachusetts, and Oregon to service the U.S. market for its products and
services. The Company continues to expand into international markets, including
Europe and Asia. The Company maintains a full service facility in Scotland to
serve the European market and full service facilities in Singapore and Taiwan to
serve the Southeast Asia market. Each of the Company's facilities is located in
proximity to semiconductor manufacturing centers.
8
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RESULTS OF OPERATIONS
Three Months Ended March 31, 1998 Compared to Three Months Ended March 31, 1997.
Net Sales. Net sales for the three months ended March 31, 1998 were
$24.6 million, an increase of 54.7% over net sales of $15.9 million for the
three months ended March 31, 1997. This increase in net sales was a result of
higher order rates for Cerprobe's probe card and interface products ($6.3
million), increased sales from CompuRoute and SVTR (together $1.7 million), and
increased sales from Cerprobe's international operations ($667,000).
Gross Profit. Gross profit for the three months ended March 31, 1998
was $10.2 million, an increase of 56.9% from the gross profit of $6.5 million
for the same period in 1997. Gross margin increased to 41.4% for the three
months ended March 31, 1998 from 40.9% for the same period of 1997. The increase
in gross margin was primarily a result of a change in product mix. Revenues from
probe cards and interfaces, which have higher gross margins, were 76.9% of
sales. Approximately 23.1% of net sales within the period was attributed to ATE
test boards from the Company's CompuRoute subsidiary and wafer prober products
and services from the Company's SVTR subsidiary.
Selling, General and Administrative. Selling, general and
administrative expenses were $5.7 million, or 23.2% of net sales, for the three
months ended March 31, 1998 as compared to $4.2 million, or 26.4% of net sales,
for the same period of 1997, an increase of $1.5 million. The increase in
selling, general and administrative expenses resulted primarily from domestic
expansion.
Engineering and Product Development. Engineering and product
development expenses were $830,087 for the three months ended March 31, 1998, an
increase of 83.1% over $453,319 for the same period of 1997. This increase
resulted primarily from Cerprobe's continued emphasis on engineering and product
development. Additionally, during the three months ended March 31, 1997,
expenses were offset by increased project funding receipts from collaborations
on engineering and product development with certain customers.
Interest Income. Interest income was $284,735 for the three months
ended March 31, 1998 as compared to $35,160 for the same period in 1997. The
increase was due to the investment of the net proceeds of the Company's recent
secondary offering.
Interest Expense. Interest expense was $60,933 for the three months
ended March 31, 1998 as compared to $134,611 for the same period in 1997, a
decrease of 54.7%. A portion of the net proceeds from the Company's recent
secondary offering was used to repay the Company's short-term debt.
Minority Interest Share of (Income) Loss. The minority interest share
of loss from operations of $17,730 for the three months ended March 31, 1998
represents the Company's joint venture partners' share (40.0%) of the income
from Cerprobe Asia PTE LTD and the Company's joint venture partner's share
(45.0%) of the loss from Upsys-Cerprobe, L.L.C. For the three months ended March
31, 1997, the minority interest share of income from operations of $12,569
represents the Company's joint venture partner's share (40.0%, 30.0% prior to
August 18, 1997) of income from Cerprobe Asia PTE LTD and the Company's joint
venture partner's share (45.0%) of the loss from Upsys-Cerprobe, L.L.C.
9
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Provision for Income Taxes. The provision for income taxes was $1.6
million, which represents an effective tax rate of 40.4% for the three months
ended March 31, 1998, compared to the provision for income taxes for the three
months ended March 31, 1997 of $566,300, which represented an effective tax rate
of 41.1%, excluding acquisition related expenses of $6.2 million. The decrease
in the effective tax rate is a result of net operating loss carry forwards from
foreign subsidiaries, the benefit from the reduced tax rate for export sales
through the Company's foreign sales corporation, and income from non-taxable
annuities.
Net Income. Net income for the three months ended March 31, 1998 was
$2.3 million, an increase of $1.2 million, or 109.1%, from net income of $1.1
million, before acquisition related expenses, for the same period of 1997.
Excluding acquisition related expenses, net income for the three months ended
March 31, 1998 was 9.3% of net sales compared to 6.7% for the same period of
1997.
LIQUIDITY AND CAPITAL RESOURCES
Cerprobe has financed its operations and capital requirements primarily
through cash flow from operations, equipment lease financing arrangements, and
sales of equity securities. At March 31, 1998, cash and short-term investments
were $28.9 million compared to $30.3 million at December 31, 1997.
Cerprobe generated approximately $1 million in cash flow from operating
activities for the three months ended March 31, 1998. Accounts receivable
increased by $2.1 million, or 20.3%, to $12.4 million at March 31, 1998. This
increase was a result of increased sales. Inventories increased $1.7 million, or
20.0%, over December 31, 1997 to $10.1 million at March 31, 1998. This increase
resulted primarily from the increased demand in the Company's probe card and
interface products.
Accounts payable and accrued expenses increased $899,338, or 11.8%, to
$8.5 million at March 31, 1998. The increase resulted from Cerprobe's continued
growth.
The current portions of notes payable and capital leases increased to
$1.5 million at March 31, 1998 from $769,459 at December 31, 1997, primarily as
a result of $788,201 of shareholder loans to Cerprobe Asia PTE LTD and
Upsys-Cerprobe, L.L.C.
Working capital increased $427,656, or 1.0%, to $42.9 million at March
31, 1998 from December 31, 1997. The current ratio decreased from 6.1 at
December 31, 1997 to 5.3 at March 31, 1998. This decrease was due to cash
utilized of $1.5 million, increases in accounts payable and accrued expenses of
$899,338 to finance the Company's growth and expansion.
Cerprobe increased its net investment in property, plant, and equipment
during the three months ended March 31, 1998 by $1.7 million, or 11.3%, to $16.8
million. This increase was attributable to the Company's efforts to expand
capacity to meet customer demand for its products. These capital expenditures
were funded from cash flow from operations and proceeds from the secondary
offering.
In April 1998, the Company signed a letter of intent to purchase the
Probe Card operation of Upsys, a French testing and engineering company owned by
IBM and GAME COGEMA Group for approximately $8,000,000 in cash.
On December 17, 1997, the Board of Directors approved, subject to
shareholder approval, the Employee Stock Purchase Plan (the "Plan"). Under the
Plan, the Company may from time to time
10
<PAGE> 11
purchase shares on the open market or through negotiated transactions, which
shares would be held for purchases by employees under the Plan.
The Company expects that it may acquire approximately 30,000 shares
over the next 12 months to satisfy its current obligations under the Plan. The
Plan provides for purchases by employees of up to 150,000 shares.
Cerprobe believes that its working capital, together with the loan
commitments described above, and anticipated cash flow from operations, will
provide adequate sources to fund operations for at least the next 12 months.
Cerprobe anticipates that any additional cash requirements for operations or
capital expenditures will be financed through cash flow from operations, by
borrowing from Cerprobe's primary lender, by lease financing arrangements, or by
sales of equity securities. There can be no assurance that any such financing
will be available on acceptable terms and that any additional equity financing,
if available, would not result in additional dilution to existing investors.
BUSINESS OUTLOOK
The Company's business depends substantially on both the volume of IC
production by semiconductor manufacturers as well as new IC designs, which in
turn depend on the demand of ICs and products utilizing ICs. The semiconductor
industry is highly cyclical and historically has experienced periods of
oversupply, resulting in reduced demand for IC testing products, including the
products manufactured by the Company. Based on preliminary indications of lower
production rates among many of the Company's customers, the Company is very
cautious about net sales for the second quarter. If a reduction occurs, the
Company expects that gross margin will decrease as it does not anticipate that
it will undertake any restructuring of costs in response to the reduction other
than savings related to the cost of materials not used. Such reduction in net
sales and its impact on gross margin will accordingly reduce net income both in
absolute terms and as a percentage of sales. If a decrease in demand persists
beyond the anticipated short-term period, the Company will review its cost
structure in response to production overcapacity. However, the Company
anticipates that demand will strengthen in the second half of 1998, and that
financial results will likewise show sequential improvement from the second
quarter through the end of 1998.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
Statements in this section regarding the Company's prospects for
continued growth and adequacy of sources of capital are forward-looking
statements. Words such as "believes," "expects," "anticipates," "intends,"
"may," "estimates," "should," "will likely," and similar expressions are
intended to identify such forward-looking statements. Actual results, however,
could differ materially from those anticipated for a number of reasons,
including product demand and development, technological advances, impact of
competitive products and pricing, growth in targeted markets and other factors
identified under "Special Considerations" of the Company's 1997 Form 10-K which
has been filed with the Securities and Exchange Commission. Additional risk
factors are identified from time to time in the Company's 1998 financial press
releases. The cautionary statements made in this Report should be read as being
applicable to all related forward-looking statements wherever they appear in
this Report.
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PART II - OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K
a. Exhibits
(11) Computation of Net Income (Loss) Per Share.
(27.1) Financial Data Schedule - March 31, 1998
(27.2) Financial Data Schedule - March 31, 1997
b. No reports on Form 8-K were filed by the Company during the
quarter ended March 31, 1998.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the undersigning
thereunto duly authorized.
CERPROBE CORPORATION
/s/ Randal L. Buness
--------------------
Randal L. Buness
Vice President - Chief Financial Officer
May 14, 1998
13
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CERPROBE CORPORATION
COMPUTATION OF NET INCOME (LOSS) PER SHARE
EXHIBIT 11
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31
-----------------------------
1998 1997
----------- -----------
<S> <C> <C>
Net income (loss) $ 2,345,430 $(4,894,633)
=========== ===========
Weighted average common shares outstanding 8,101,001 6,292,662
Common equivalent shares representing shares
issuable upon exercise of stock options 381,242 242,812
Add back of common equivalent shares due to
antidilutive nature -- (242,812)
----------- -----------
Dilutive adjusted weighted average shares
and assumed conversions 8,482,243 6,292,662
=========== ===========
Basic net income (loss) per share $ 0.29 $ (0.78)
=========== ===========
Diluted net income (loss) per share $ 0.28 $ (0.78)
=========== ===========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This Schedule contains summary financial information extracted from the
Condensed Consolidated Balance Sheet at March 31, 1998 and the Condensed
Consolidated Statements of Operations for the three months ended March 31, 1998
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 28,873,747
<SECURITIES> 0
<RECEIVABLES> 12,667,774
<ALLOWANCES> 273,000
<INVENTORY> 10,142,221
<CURRENT-ASSETS> 53,004,920
<PP&E> 24,873,823
<DEPRECIATION> 8,065,596
<TOTAL-ASSETS> 73,205,489
<CURRENT-LIABILITIES> 10,072,341
<BONDS> 1,142,401
0
0
<COMMON> 405,249
<OTHER-SE> 61,020,008
<TOTAL-LIABILITY-AND-EQUITY> 73,205,489
<SALES> 24,590,337
<TOTAL-REVENUES> 24,590,337
<CGS> 14,413,024
<TOTAL-COSTS> 6,485,847
<OTHER-EXPENSES> 6,531
<LOSS-PROVISION> 6,000
<INTEREST-EXPENSE> 60,933
<INCOME-PRETAX> 3,908,737
<INCOME-TAX> 1,581,037
<INCOME-CONTINUING> 2,345,430
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,345,430
<EPS-PRIMARY> 0.29
<EPS-DILUTED> 0.28
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This Schedule contains summary financial information extracted from the
Condensed Consolidated Balance Sheet at March 31, 1997 and the Condensed
Consolidated Statements of Operations for the three months ended March 31, 1997
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 1,840,106
<SECURITIES> 0
<RECEIVABLES> 8,451,214
<ALLOWANCES> 238,883
<INVENTORY> 6,912,631
<CURRENT-ASSETS> 17,462,701
<PP&E> 18,215,141
<DEPRECIATION> 5,380,279
<TOTAL-ASSETS> 34,324,135
<CURRENT-LIABILITIES> 10,293,491
<BONDS> 2,383,324
16
0
<COMMON> 317,652
<OTHER-SE> 20,892,372
<TOTAL-LIABILITY-AND-EQUITY> 34,324,135
<SALES> 15,899,092
<TOTAL-REVENUES> 15,899,092
<CGS> 9,394,372
<TOTAL-COSTS> 10,789,924
<OTHER-EXPENSES> (58,891)
<LOSS-PROVISION> 6,000
<INTEREST-EXPENSE> 134,611
<INCOME-PRETAX> (4,325,764)
<INCOME-TAX> 556,300
<INCOME-CONTINUING> (4,894,633)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,894,633)
<EPS-PRIMARY> (0.78)<F1>
<EPS-DILUTED> (0.78)<F1>
<FN>
<F1>EPS-Primary and EPS-Diluted are restated to include the impact of Financial
Accounting Standards' Board Statement No. 128.
</FN>
</TABLE>
