BE Semiconductor Industries Reports 1996 Annual Results

Business Wire, Feb 17, 1997

ZEVENAAR, The Netherlands--(BUSINESS WIRE)--Feb. 18, 1997--

-- Net Income Increased Over 30% -- Earnings Per Share NLG 1.44

BE Semiconductor Industries NV (Nasdaq: BESIF; Amsterdam Stock Exchange: BESI; Frankfurt Stock Exchange: BSI), a leading manufacturer of assembly equipment for the semiconductor industry, today announced earnings of NLG 37.8 million for the year ended December 31, 1996 in comparison with a loss of NLG 20.1 million for the year ended December 31, 1995.

The Company has prepared pro forma financial information for 1995 in order to present an accurate comparison of the Company's year-over-year financial performance. The pro forma data reflects the acquisition of Meco International as if such transaction had occurred on January 1, 1995. Included in the pro forma information are adjustments reflecting a non-recurring charge of NLG 44.4 million in the second quarter of 1995 for the acquisition of Meco and a non-cash management compensation charge of NLG 11.3 million in the third quarter of 1995.

For the year ended December 31, 1996, net sales increased 25% to a record NLG 480.0 million (US$ 277.9 million), compared to NLG 384.5 million (US$ 222.6 million) in 1995 on a pro forma basis. Net income for 1996 totaled NLG 37.8 million (US$ 21.9 million), an increase of 30%, compared to NLG 29.0 million (US$ 16.8 million) on a pro forma basis for 1995. 1996 earnings per share were NLG 1.44 (US$ 0.83), compared to pro forma earnings per share of NLG 1.15 (US$ 0.67) for the year ended December 31, 1995. The sales increase in 1996 as compared to the prior year was due to increased shipments of automated plating and packaging equipment, partly offset by a decrease in sales of leadframes and plating services.

Richard Blickman, President and Chief Executive Officer, commented, "We achieved significant growth during 1996. In addition, the Company accomplished several important milestones reflecting our efforts to accelerate research and development programs ahead of schedule. In October, we received our first order for an Advanced Cutstrip Plating System. We also sold the first new generation Electromechanical Modular Molding System and shipped the first integration line for the packaging and test of power integrated circuits."

Mr. Blickman continued, "Recently, we signed a letter of intent to form a joint venture company named Possehl BESI Electronic NV. The company will be a vertically integrated leadframe supplier that ranks among the top ten globally."

For the fourth quarter ended December 31, 1996, net sales decreased slightly to NLG 114.4 million (US$ 66.2 million), compared to net sales of NLG 115.5 million (US$ 66.9 million) in the corresponding period of 1995. The Company's net income for the fourth quarter of 1996 was NLG 7.2 million (US$ 4.2 million) compared to net income of NLG 9.6 million (US$ 5.6 million) in the 1995 period on a pro forma basis. On a sequential basis, net sales in the fourth quarter increased 4% from NLG 110.0 million (US$ 63.7 million), and net income increased 7% from NLG 6.7 million (US$ 3.9 million) in the third quarter of 1996.

Driven by higher sales and manufacturing efficiencies gross profit improved by 31% to NLG 173.0 million (US$ 100.2 million) from NLG 132.2 million (US$ 76.5 million) in 1995 on a pro forma basis. As a percentage of net sales, gross margin for the full year increased to 36.0%, compared to 34.4% in 1995. The gross margin was 36.0% in the fourth quarter of 1996 and was higher than the 34.9% realized in the third quarter of this year. In the year ago fourth quarter the gross margin was 36.8%.

The Company's backlog at the end of 1996 decreased to NLG 140.0 million from NLG 178.9 million for the previous quarter ended September 30, 1996. The Company reported a decrease in systems backlog to NLG 126.3 million at December 31, 1996, compared to NLG 165.5 million for the quarter ended September 30, 1996. This decrease can be attributed to higher shipments and lower new orders for systems. Leadframes and plating services' backlog increased to NLG 13.6 million at December 31, 1996 from NLG 13.4 million for the 1996 third quarter. The Company views leadframe activity as an important indicator of future semiconductor production by its customers.

The Company noted, however, that order activity, on a sequential basis, increased in the fourth quarter of 1996 with total orders of NLG 75.5 million, compared to NLG 51.3 million in the third quarter of 1996. Richard Blickman commented, "Although we cannot predict when new order rates will further improve in relation to current levels, we can report that the increase in new orders in the fourth quarter of 1996 has continued."

At December 31, 1996, cash totaled NLG 45.7 million and exceeded total debt of NLG 23.4 million, of which NLG 19.1 million was long-term. Shareholders' equity was NLG 267.6 million and equaled 63.8% of total assets.

This press release contains forward-looking statements that involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are the cyclicality of the semiconductor equipment industry, risks related to customer concentration, delays and cancellations of product orders, competitive pressures, general economic conditions and the risk factors detailed in the Company's periodic reports and registration statements filed with the Securities and Exchange Commission.