SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
February 16, 1999
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Date of Report (Date of earliest event reported)
CREDENCE SYSTEMS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 000-22366 94-2878499
- ---------------------------- ---------------------- ----------------------
(State of incorporation (Commission File Number) (IRS Employer
or organization) Identification No.)
215 Fourier Avenue, Fremont, California 94539
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (510) 657-7400
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NONE
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Former name,former address and former fiscal year, if changed since last report.
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ITEM 5. OTHER EVENTS
On February 16, 1999, Registrant issued a press release reporting
the financial results for its first quarter ended January 31, 1999.
ITEM 7. EXHIBITS
A copy of the Registrant's press release announcing its financial
results for the first quarter ended January 31, 1999 is attached hereto as
Exhibit 99.1 and incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, as
amended, the registrant duly caused this Report to be signed on its behalf by
the undersigned thereunto duly authorized.
CREDENCE SYSTEMS CORPORATION
------------------------------------------
(Registrant)
February 16, 1999 /s/ DENNIS P. WOLF
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Date Dennis P. Wolf
Executive Vice President,
Chief Financial Officer & Secretary
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EXHIBIT INDEX
Exhibit
Number
99.1 Press Release disseminated February 16, 1999 regarding the
Registrant's financial results for the first quarter ended
January 31, 1999.
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EXHIBIT 99.1
[LETTERHEAD OF CREDENCE SYSTEMS CORPORATION]
FOR IMMEDIATE RELEASE
NEWS RELEASE
------------
For More Information Contact:
Dennis P. Wolf Julie Cimino
Executive Vice President and CFO Investor Relations
(510) 657-7400 (510) 657-7400
CREDENCE SYSTEMS REPORTS RESULTS FOR
FIRST FISCAL QUARTER OF 1999
FREMONT, Calif.--February 16, 1999--Credence Systems Corporation
(Nasdaq NMS: CMOS) today reported results for its first fiscal quarter ended
January 31, 1999. Net sales were $26.5 million, a decrease of 68 percent from
net sales of $82.4 million in the record first quarter of fiscal 1998. Net
sales were up 18 percent consecutively from the net sales of $22.4 million in
the company's fourth fiscal quarter of 1998. The net loss for the first
quarter of fiscal 1999 was $6.6 million or $0.32 per share, compared to net
income of $9.2 million during the first fiscal quarter of 1998, or $0.41 per
diluted share. The first quarter 1999 net loss did show improvement over the
fourth quarter of 1998, when the company reported a net loss of $10.7 million
or $0.51 per share, after the incurrence of special charges. Included in the
loss in the Company's recent first fiscal quarter is $0.6 million in charges
associated with costs relating to disposal of an excess facility.
Credence's executive vice president and chief financial officer, Mr.
Dennis Wolf, said, "We experienced an increase in new orders and average selling
prices on existing products during the quarter. However, we did not see a
material improvement in gross margins during the quarter, in part because we are
still running the factory below capacity and also due to continued
inefficiencies on the delayed new products. Our operating expenses for the
quarter were $21.2 million, a reduction of 37 percent from the $33.8 million in
the first fiscal quarter of 1998."
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CREDENCE SYSTEMS REPORTS RESULTS FOR FIRST FISCAL QUARTER OF 1999
Page 2
Mr. David Ranhoff, Credence's executive vice president said, "Our
revenue and bookings activity for the first fiscal quarter were up from prior
periods. Our customers ordered equipment for both capacity as well as new
capability needs." Mr. Ranhoff continued, "While we have made progress on our
new product development programs, we do not expect revenue for these products
until the second half of the year."
Credence Systems Corporation is a leader in the manufacture of
automatic test equipment (ATE) for the worldwide semiconductor industry.
Credence offers a wide range of products with test capabilities for digital,
mixed-signal, and memory semiconductors. Utilizing its proprietary CMOS
technologies, Credence products are designed to meet the strict time-to-market
and ownership requirements of its customers.
Headquartered in Fremont, California, the company maintains advanced
production and design facilities in Beaverton, Oregon. Credence, an ISO 9001
certified manufacturer, is listed on the Nasdaq National Market under the symbol
CMOS. More information is available at www.credence.com.
Statements in this release that are forward looking involve known and
unknown risks and uncertainties, which may cause the Company's actual results in
future periods to be materially different from the future performance suggested
in this release. Such factors include, but are not limited to, economic and
currency instability in the Asia Pacific region, fluctuation in customer demand,
timing and volume of orders and shipments, competition and pricing pressures,
reliability and quality issues, the Company's ability to complete the
development of its new products, product mix, underabsorption of overhead,
cyclicality and downturns in the semiconductor industry, continued dependence on
"turns" orders to achieve revenue objectives, the Company's ability to have an
appropriate amount of production capacity in a timely manner, the timing of new
technology, product introductions, the risk of early obsolescence and the
Company's ability control expenses (including the ability to identify and
successfully institute additional cost-saving measures).
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CREDENCE SYSTEMS REPORTS RESULTS FOR FIRST FISCAL QUARTER OF 1999
Page 3
Further, the Company operates in an industry sector where securities
values are highly volatile and may be influenced by economic and other factors
beyond the Company's control. Reference is made to the discussion of risk
factors detailed in the Company's filings with the Securities and Exchange
Commission, including its reports on Form 10-K and 10-Q. The Company assumes no
obligation to update the information in this press release.
Credence, Credence Systems, Duo, SC, ValStar, Kalos, and Quartet are
trademarks of Credence Systems Corporation. Other trademarks, which may be
mentioned in this release, are the intellectual property of their
respective owners.
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CREDENCE SYSTEMS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
(unaudited) (unaudited)
Three Months Prior Quarter
Ended Ended
January 31, October 31,
-------------------- -------------
1999 1998 1998
-------- -------- --------
<S> <C> <C> <C>
Net sales ............................... $ 26,490 $ 82,375 $ 22,446
Cost of goods sold - on net sales ....... 15,276 35,438 13,001
Cost of goods sold - special charges .... -- -- 7,400
-------- -------- --------
Gross margin ............................ 11,214 46,937 2,045
Operating expenses:
Research and development ................ 9,003 13,491 10,191
Selling, general and administrative ..... 12,231 20,308 11,925
In-process research and development ..... -- -- (2,840)
Special charges ......................... -- -- 2,000
-------- -------- --------
Total operating expenses ................ 21,234 33,799 21,276
-------- -------- --------
Operating income (loss) ................. (10,020) 13,138 (19,231)
Interest and other income
(expenses), net ......................... (301) 958 151
-------- -------- --------
Income (loss) before income taxes ....... (10,321) 14,096 (19,080)
Income taxes ............................ (3,729) 4,934 (8,327)
Minority interest ....................... (38) (29) (79)
-------- -------- --------
Net income (loss) ....................... ($ 6,554) $ 9,191 ($ 10,674)
======== ======== ========
Net income (loss) per share
Basic ................................ ($0.32) $0.42 ($0.51)
======== ======== ========
Diluted .............................. ($0.32) $0.41 ($0.51)
======== ======== ========
Number of shares used in
computing per share amount
Basic ................................ 20,418 21,864 20,963
======== ======== ========
Diluted .............................. 20,418 22,415 20,963
======== ======== ========
</TABLE>
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CREDENCE SYSTEMS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
Prior Quarter
January 31, October 31,
------------ -----------
1999 1998
--------- --------
Unaudited
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents ........................... $ 58,343 $ 48,391
Restricted cash ..................................... -- 2,400
Short-term investments .............................. 46,770 62,777
Accounts receivable, net ............................ 37,442 33,901
Inventories ......................................... 35,141 37,406
Other current assets ................................ 30,458 40,676
-------- --------
Total current assets .............................. 208,154 225,551
Long-term investments .................................. 23,666 20,357
Property and equipment, net ............................ 40,630 41,764
Other assets ........................................... 17,903 18,517
-------- --------
Total assets ...................................... $ 290,353 $ 306,189
======== ========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable .................................... $ 6,433 $ 8,090
Accrued liabilities ................................. 21,936 26,978
Income taxes payable ................................ 2,017 5,877
-------- --------
Total current liabilities ......................... 30,386 40,945
Convertible subordinated notes payable ................. 115,000 115,000
Minority interest ...................................... 170 227
Stockholders' equity ................................... 144,797 150,017
-------- --------
Total liabilities and stockholders' equity ........ $ 290,353 $ 306,189
======== ========
</TABLE>
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