Ultra Clean Reports Second Quarter 2011 Financial Results

Company Reports Record Revenue and EPS in its Second Quarter of Fiscal 2011

HAYWARD, Calif., July 25, 2011 /PRNewswire/ -- Ultra Clean Holdings, Inc. (Nasdaq: UCTT), a leading developer and supplier of critical subsystems for the semiconductor capital equipment, flat panel, medical, energy and research industries, today reported its financial results for the second quarter of fiscal year 2011 ended July 1, 2011.  

Revenue for the second quarter was $133.7 million, an increase of 5.5% from the first quarter 2011 and an increase of 26.3% from the same period a year ago.  Semiconductor revenue was 74% of total revenue for the second quarter compared to 80% in the previous quarter and revenue outside the US accounted for 31% of the total revenue for the second quarter compared to 29% for the previous quarter. Gross margin for the second quarter was 14.2%, compared to 13.9% for the first quarter 2011 and 14.0% for the second quarter a year ago.

The company recorded net income of $7.0 million, or $0.30 per share in the second quarter compared to net income of $5.8 million, or $0.25 per share in the first quarter of 2011 and net income of $5.7 million, or $0.25 per share for the second quarter of 2010.  

Cash at the end of the second quarter 2011 was $37.6 million, an increase of $2.3 million from the prior quarter.  Net liquidity was $11.4 million, an increase of $3.4 million from the prior quarter.

Clarence Granger, Ultra Clean's Chairman and Chief Executive Officer stated: "We are extremely pleased with our operating results for the second quarter of 2011, as we surpassed our guidance for both revenue and earnings per share.  Revenue, again, was at an all-time high and we continued to improve our operational efficiencies during the quarter as evidenced by the increase in our gross margins. We continue to drive more revenue through our Asian operations as well as increase the proportion of revenues from non-semiconductor equipment industries."

Commenting on Ultra Clean's corporate guidance, Granger noted: "Revenue guidance for the third quarter 2011 is $105 million to $110 million, with earnings per share in the range of $0.14 to $0.18. This projection reflects the declines in demand projected by all of our major semiconductor equipment customers for the third quarter of 2011. During the third quarter we are forecasting a tax rate of 24%."

Ultra Clean will conduct a conference call today, Monday, July 25, 2011, beginning at 1:45 p.m. PDT at 888-561-5097 (domestic) and 706-679-7569 (international). A replay of the webcast will be available for fourteen days following the conference call at 855-859-2056 (domestic) and 404-537-3406 (international). The confirmation number for the live broadcast and replay is 82775093 (all callers). The conference call will also be webcast live and be available for fourteen days on our website.

About Ultra Clean Holdings, Inc.

Ultra Clean Holdings, Inc. is a leading developer and supplier of critical subsystems for the semiconductor capital equipment, flat panel, medical, energy and research industries. Ultra Clean offers its customers an integrated outsourced solution for gas delivery systems and other subassemblies, improved design-to-delivery cycle times, component neutral design and manufacturing and component testing capabilities. Ultra Clean's customers are primarily original equipment manufacturers for the semiconductor capital equipment, flat panel, medical, energy and research industries. Ultra Clean is headquartered in Hayward, California. Additional information is available at www.uct.com.

Safe Harbor Statement

The foregoing information contains, or may be deemed to contain, "forward-looking statements" (as defined in the US Private Securities Litigation Reform Act of 1995) which reflect our current views with respect to future events and financial performance. We use words such as "anticipates," "believes," "plan," "expect," "future,"' "intends," "may," "will," "should," "estimates," "predicts," "potential," "continue" and similar expressions to identify these forward-looking statements. Forward looking statements included in the press release include estimates made with respect to our third quarter 2011 revenue and earnings per share. All forward-looking statements address matters that involve risks and uncertainties. Accordingly, our actual results may differ materially from the results predicted or implied by these forward- looking statements. These risks, uncertainties and other factors include, among others, those identified in "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations'' and elsewhere in our annual report on Form 10-K for the year ended December 31, 2010 filed with the Securities and Exchange Commission. Ultra Clean Holdings, Inc. undertakes no obligation to publicly update or review any forward-looking statements, whether as a result of new information future developments or otherwise.

Ultra Clean Holdings, Inc.

Condensed Consolidated Statements of Income

(Unaudited; in thousands, except per share data)







For the three months ended


For the six months ended


July 1, 2011


July 2, 2010


July 1, 2011


July 2, 2010

Sales

$    133,741


$    105,878


$    260,460


$    204,345









Cost of goods sold

114,748


91,083


223,915


177,174









Gross profit

18,993


14,795


36,545


27,171









Operating expenses:








Research and development

1,437


1,390


3,042


2,447

Sales and marketing

2,018


1,895


4,075


3,528

General and administrative

6,045


4,941


11,748


10,004

       Total operating expenses

9,500


8,226


18,865


15,979









Income from operations

9,493


6,569


17,680


11,192









Interest and other income (expense), net

(367)


(145)


(735)


(300)









Income before income taxes

9,126


6,424


16,945


10,892









Income tax provision

2,168


770


4,167


1,388









Net income

$        6,958


$        5,654


$      12,778


$        9,504









Net income per share:








Basic

$          0.31


$          0.26


$          0.57


$          0.44

Diluted

$          0.30


$          0.25


$          0.54


$          0.41









Shares used in computing net income per share:








Basic

22,734


21,670


22,597


21,589

Diluted

23,482


23,016


23,528


22,905



Ultra Clean Holdings, Inc.

Condensed Consolidated Balance Sheets

(Unaudited; in thousands)






July 1,


December 31,

ASSETS

2011


2010





Current assets:




  Cash and cash equivalents

$   37,636


$          34,654

  Accounts receivable

57,779


54,589

  Inventory

69,871


59,288

  Other current assets

8,858


5,935

     Total current assets

174,144


154,466





Equipment and leasehold improvements, net

10,256


8,971

Purchased intangibles, net

8,987


8,987

Other non-current assets

598


571

Total assets

$ 193,985


$        172,995





LIABILITIES & STOCKHOLDERS' EQUITY




Current liabilities




Bank borrowings

$     3,333


$            4,110

Accounts payable

48,916


45,957

Other current liabilities

11,943


7,654

     Total current liabilities

64,192


57,721





Bank debt and other long-term liabilities

25,691


27,765

     Total liabilities

89,883


85,486





Stockholders' equity




Common stock

103,274


99,459

Retained earnings (deficit)

828


(11,950)

    Total stockholders' equity

104,102


87,509

Total liabilities and stockholders' equity

$ 193,985


$        172,995



SOURCE Ultra Clean Holdings, Inc.

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