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Ultra Clean Holdings, Inc. (UCTT)
F1Q09 Earnings Call Transcript
May 04, 2009 at 5:00 pm ET
Clarence Granger - Chairman and Chief Executive Officer
Linda Clements - Vice President of Finance, Principal Financial Officer and Principal Accounting Officer
Jay Deahna - Individual Investor, JP Morgan
Edwin Mok - Needham & Company
Timothy Summers - Wunderlich Securities, Inc.
Previous Statements by UCTT
» Ultra Clean Holdings Inc. Q3 2009 Earnings Call Transcript
» Ultra Clean Holdings Inc. Q4 2008 Earnings Call Transcript
» Ultra Clean Holdings, Inc. Q3 2008 Earnings Call Transcript
Good afternoon. My name is Ashley, and I will be your conference operator today. At this time, I would like to welcome everyone to the Ultra Clean Technology’s first quarter financial results conference call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. (Operator Instructions) Joining us today is Mr. Clarence Granger, Chairman and Chief Executive Officer.
I will now turn the call over to Mr. Granger. Sir, you may begin your conference.
Thank you, Ashley. Welcome to our first quarter financial results conference call. With me today is Linda Clements, our Vice President of Finance, Principal Financial Officer and Principal Accounting Officer.
Linda will begin by presenting the financial results for our first quarter and then I will follow with some remarks about the business. Linda?
Thank you, Clarence. A few moments ago, we issued a press release recording the financial results for the first quarter ended April 3rd, 2009. The press release can be accessed from the Investor Relations section of Ultra Clean’s website at uct.com. In addition, we have arranged for a taped replay of this call, which may be accessed by phone. This replay will be available approximately one hour after the call’s conclusion and will be accessible for two weeks.
The dial-in access number for this replay is 800-642-1687 for domestic callers and 706-645-9291 for international dialers. The pass code is 94739714 for both domestic and international dialers. This call is also being webcast live with a web replay also available for 14 days from the Investor Relations section of our website at uct.com.
Together with our recently issued press release, this conference call enables the Company to comply with SEC regulations for fair disclosure. Therefore, investors should accept the contents of this call as the Company’s official guidance for the second quarter of fiscal 2009. Investors should note that only the CEO and Principal Financial Officer are authorized to provide Company guidance. If at any time after this call we communicate any material changes in guidance, it is our intent that such updates will be done officially via public forum, such as a press release or publicly announced conference call.
The matters that we discuss today include forward-looking statements as defined in the US Private Securities Litigation Reform Act of 1995 related to matters including our future financial performance, new product orders and shipments and industry growth.
Investors are cautioned that forward-looking statements are neither promises nor guarantees, but involve risks and uncertainties that may cause actual results to differ materially from those projected in the forward-looking statements. Some of those risks and uncertainties are detailed in our filings with the Securities and Exchange Commission, including our most recent Form 10-K filed for the year ended January 2nd, 2009. The Company disclaims any obligation to publicly update or revise any such forward-looking statements or to reflect events or circumstances that occur after this call.
Now, here are the first quarter results.
Revenue for the first quarter of 2009 was $22.4 million, down 52% from the fourth quarter revenue of $47.1 million, and a decrease of 76% compared to revenue of $92.4 million in the same period a year ago.
The decrease in revenue was due to the continued industry-wide cyclical reduction in demand affecting all semiconductor capital equipment customers. In addition, we saw a decrease in our non-semiconductor business as a result of current economic condition.
Semiconductor revenues declined $15.5 million or 57% sequentially. Non-semiconductor revenues, including sales within the medical device, flat panel display and solar industries, decreased $9 million or 46% sequentially to $11 million.
We experienced a negative gross margin for the first quarter of 12.8% down from a gross margin of approximately 1% recorded in the fourth quarter and a decrease from approximately 13% in the same period a year ago. On the $3.3 million sequential gross profit decrease, $5.4 million is related to the volume decrease, offset by approximately $2.1 million of cost savings.
We recorded a restructureD charge during the quarter related to the closure of our Tualatin, Oregon facility of approximately $146,000 net of tax or $0.01 per share. We also expensed approximately $316,000 net of tax or $0.01 per share for cost related to an acquisition transaction that was not consummated.
Operating expenses, inclusive of the restructure charge and transaction costs were $7.3 million, a decrease of approximately $600,000 from the prior quarter when excluding impairment costs recorded in the fourth quarter of 2008.
The sequential decrease reflects the cost savings from staff reductions and other cost saving activities, as well as the absence of amortization of intangibles as a result of the asset impairment recorded in the fourth quarter, offset in part by the restructure charge and transaction costs.
Net interest and other expense of $195,000 represents an increase of approximately $150,000 from the prior quarter primarily as a result of the interest income recorded in the fourth quarter on government reimbursements offsetting interest expense related to third-party debt.