EX-99 2 ex99-1.htm EXHIBIT 99.1

 

 

Exhibit 99.1


News Release

 

For Further Information Call:

Walter A. Shephard

Vice President Finance, CFO, and Treasurer

Voice: 860-704-3955

inquire@zygo.com

For Immediate Release

 

ZYGO ANNOUNCES FISCAL 2006 Q4 AND FULL YEAR EARNINGS

--- RECORD ANNUAL ORDERS, SALES, AND EARNINGS ---

 

MIDDLEFIELD, CT, AUGUST 17, 2006 – Zygo Corporation (NASDAQ: ZIGO) today announced net sales were $47.2 million and net earnings were $4.5 million, or $0.24 per diluted share, for the fourth quarter of fiscal 2006. As compared with the same period in fiscal 2005, net sales increased by $2.5 million and net earnings increased by $1.1 million, or $0.05 per diluted share. Earnings per diluted share for the quarter were favorably impacted by the Company’s high sales volume and improved margins, and by the recognition of a tax benefit related to prior year foreign trading income of $0.03 per diluted share.

 

For fiscal 2006, the Company recorded net sales of $168.1 million and net earnings of $14.5 million, or $0.79 per diluted share, as compared with fiscal 2005 net sales of $141.3 million and net earnings of $9.0 million, or $0.50 per diluted share. Earnings per diluted share for fiscal 2006 were positively impacted by the recognition of a tax benefit related to prior year foreign trading income of $0.07 per diluted share.

 

Bruce Robinson, ZYGO’s Chairman and CEO stated, “Fiscal 2006 was an outstanding year for the Company. Our fourth quarter continued the strong performance that we showed in the first nine months. We are extremely pleased with our financial results, including Company records for orders, sales, and earnings, with all three of our business units making significant contributions to our success this year.”

 

Orders for the fourth quarter of fiscal 2006 were $48.6 million resulting in a positive book-to-bill. Orders from the Company’s semiconductor segment accounted for 64% of the orders received, with the industrial segment accounting for the remaining 36%. For the full year, orders were $182.3 million, an increase of 19% over fiscal 2005.

 

“Fiscal 2006 was a year in which we made significant progress in the implementation of our strategic plan. We have shipped systems for in-line use in manufacturing, demonstrating our ability to move from our traditional lab environment to the production floor. This is expected to increase revenues and margins over time,” Mr. Robinson continued.

 

 

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Highlights during the year included:

 

 

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Designed, developed, and shipped for qualification our first front end semiconductor process metrology tool.

 

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Flat panel orders for the year totaled $16.1 million reflecting increased demand for both our color filter and thin film technology tools, which provided for a strong backlog at year-end and a springboard for expected increased revenues in fiscal 2007.

 

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Lithography orders throughout the year remained robust as our two main customers continued to be successful in this segment of the business.

 

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Our Optical Systems Group received an initial order for its Helmet Mounted Display unit, with the expectation that shipments will commence in the second half of fiscal 2007.

 

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Our Laser Fusion Group received its third major contract.

 

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Gross profit and operating profit margins, as a percentage of sales, continued to show year over year improvement for the third year in a row.

 

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The Company’s balance sheet continues to be a source of strength, with cash and marketable securities of $65.5 million at year-end.

 

Mr. Robinson concluded, “ZYGO will continue the transformation of the Company that began three years ago. Fiscal 2007 will be a challenging year for us. However, with the combination of our new initiatives along with our core products, and the efforts and dedication of our employees, we expect that ZYGO will continue to grow in fiscal 2007.”

 

Zygo Corporation is a worldwide supplier of optical metrology instruments, precision optics, and electro-optical design and manufacturing services, serving customers in the semiconductor capital equipment and industrial markets.

 

Note: ZYGO’s teleconference to discuss the results of the fourth quarter of fiscal 2006 will be held at 6 PM Eastern Standard Time on August 17, 2006 and can be accessed by dialing 800-732-8451. This call is web cast live on ZYGO’s web site at www.zygo.com. The call may also be accessed for 30 days following the teleconference.

 

All statements other than statements of historical fact included in this news release regarding our financial position, business strategy, plans, anticipated growth rates, and objectives of management of the Company for future operations are forward-looking statements. Forward-looking statements are intended to provide management's current expectations or plans for the future operating and financial performance of the Company based upon information currently available and assumptions currently believed to be valid. Forward-looking statements can be identified by the use of words such as "anticipate," "believe," "estimate," "expect," "intend," "plans," "strategy," "project," and other words of similar meaning in connection with a discussion of future operating or financial performance. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors. Among the important factors that could cause actual events to differ materially from those in the forward-looking statements are fluctuations in capital spending of our customers, fluctuations in net sales to our major customer, manufacturing and supplier risks, dependence on and timing of new product development, rapid technological and market change, risks in international operations, dependence on proprietary technology and key personnel, length of the sales cycle, environmental regulations, and fluctuations in our stock price. Further information on potential factors that could affect Zygo Corporation’s business is described in our reports on file with the Securities and Exchange Commission, including our Form 10-K, as amended, for the fiscal year ended June 30, 2005.

 

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Zygo Corporation and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

 

(Thousands, except per share amounts)

 

  Three Months Ended Twelve Months Ended  
June 30,
2006		   June 30,
2005 		  June 30,
2006 		  June 30,
2005		  
Net sales                            
         Products     $ 41,897   $ 38,714   $ 148,123   $ 125,732  
         Development services       5,254     6,003     20,014     15,617  
        47,151     44,717     168,137     141,349  
Cost of goods sold    
         Products       24,541     23,942     88,119     76,921  
         Development services       3,631     4,372     14,247     11,138  
        28,172     28,314     102,366     88,059  
         Gross profit       18,979     16,403     65,771     53,290  
                             
Selling, general, and administrative expenses       8,616     8,025     31,125     24,905  
Research, development, and engineering expenses       4,994     2,688     15,901     13,377  
         Operating profit       5,369     5,690     18,745     15,008  
 
Other income    
         Interest income       617     342     2,119     885  
         Miscellaneous income (expense), net       93     (130 )   262     (98 )
         Total other income       710     212     2,381     787  
         Earnings from continuing operations    
            before income taxes and minority interest       6,079     5,902     21,126     15,795  
                             
Income tax expense       (1,386 )   (2,406 )   (5,849 )   (5,694 )
Minority interest       (178 )   (78 )   (792 )   (751 )
         Earnings from continuing operations       4,515     3,418     14,485     9,350  
                             
Discontinued TeraOptix operations, net of tax       —     (32 )   —     (242 )
Charges and adjustments on the disposal of    
   TeraOptix, net of tax       —     (17 )   —     (124 )
         Loss from discontinued operations       —     (49 )   —     (366 )
Net earnings     $ 4,515   $ 3,369   $ 14,485   $ 8,984  
     
Basic - Earnings per share:    
         Continuing operations     $ 0.25   $ 0.19   $ 0.80   $ 0.52  
         Discontinued operations       —     (0.01 )   —     (0.02 )
         Net earnings     $ 0.25   $ 0.18   $ 0.80   $ 0.50  
     
Diluted - Earnings per share:    
         Continuing operations     $ 0.24   $ 0.19   $ 0.79   $ 0.52  
         Discontinued operations       —     —     —     (0.02 )
         Net earnings     $ 0.24   $ 0.19   $ 0.79   $ 0.50  
     
Weighted average shares outstanding:    
         Basic       18,103     17,976     18,054     17,950  
         Diluted       18,503     18,146     18,367     18,140  

 

 

 

 

 

 

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Zygo Corporation and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited)

 

(Thousands of dollars)
June 30, 2006
June 30, 2005
  
Assets                
Current assets:    
         Cash and cash equivalents     $ 20,318   $ 20,949  
         Marketable securities       21,415     17,242  
         Receivables, net       33,759     28,124  
         Inventories       38,082     33,727  
         Prepaid expenses       2,106     2,126  
         Deferred income taxes       11,959     8,895  
              Total current assets       127,639     111,063  
                 
Marketable securities       23,743     18,711  
Property, plant, and equipment, net       32,631     31,420  
Deferred income taxes       15,433     22,333  
Intangible assets, net       5,925     5,638  
Other assets       812     1,017  
Total assets     $ 206,183   $ 190,182  
     
Liabilities and Stockholders' Equity    
Current liabilities:    
         Payables     $ 13,987   $ 13,510  
         Accrued expenses       29,734     32,664  
         Income taxes payable       2,004     1,510  
              Total current liabilities       45,725     47,684  
                 
Other long-term liabilities       101     96  
Minority interest       1,419     1,249  
Stockholders' equity       158,938     141,153  
Total liabilities and stockholders' equity     $ 206,183   $ 190,182  

 

 

 

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