CUPERTINO, Calif., Nov. 27, 2007 - Verigy Ltd. (NASDAQ: VRGY), a premier semiconductor test company, today reported financial results for its fourth quarter and fiscal year 2007 ended Oct. 31, 2007.
Fiscal fourth quarter revenue was $209 million, a sequential increase of 2.5 percent from the prior quarter of $204 million, and a 3.5 percent increase over revenue of $202 million in the fourth quarter of fiscal 2006.
On a GAAP basis, net income for the fourth quarter was $32 million, or $0.52 per fully diluted share, compared with net income of $30 million, or $0.50 per fully diluted share in the prior quarter, and $14 million or $0.25 per fully diluted share in the fourth quarter of fiscal 2006. Net income for the fourth quarter included $1.4 million of separation and restructuring charges and $2 million of income tax expense due to a recent change in the German statutory tax rate. Excluding these charges, on a non-GAAP basis net income was $35 million, or $0.58 per fully diluted share.
For fiscal year 2007, revenue was $761 million, a decrease of 2.2 percent from revenue of $778 million in fiscal 2006. On a GAAP basis, net income for fiscal year 2007 was $97 million, or $1.61 per fully diluted share, compared to break-even for fiscal 2006.
Orders for the fourth quarter were $183 million, a sequential decrease of approximately 12 percent, but an increase of 12 percent from $164 million in the fourth quarter of fiscal 2006. For the full year, orders were $726 million, a decrease of approximately 15 percent from last year.
"Our financial performance for the fourth quarter and first full fiscal year as a public company was very impressive given the semiconductor market volatility," said Keith Barnes, Verigy chairman, chief executive officer, and president. "We won new SOC and memory customers, strengthened our presence in high speed memory, and gained significant momentum in RF. Demand for the 93K was very strong throughout Q4, which resulted in the second highest revenue quarter ever for SOC. As we enter the first quarter of our fiscal 2008, we feel optimistic about our business overall."
"We are very proud of the fact that we exceeded guidance for both revenue and earnings per share for the fourth quarter, and consistently improved quarterly earnings throughout fiscal 2007," added Bob Nikl, Verigy chief financial officer. "These results demonstrate the continuing strength of our operating model, and continued improvement in profitability will remain a top priority for us in the coming year."
Outlook for Q1 2008
For the fiscal first quarter ending Jan. 31, 2008, the company is providing the following guidance:
- Revenue is expected to be in the range of $195 to $205 million
- GAAP net income is expected to be in the range of $30 to $33 million, or $0.49 to $0.54 per fully diluted share, and will include between $3.6 to $4.2 million of share-based compensation expense
- On a non-GAAP basis, the company expects to report net income of $27 to $30 million, or $0.45 to $0.50 per share. To reconcile third quarter GAAP and non-GAAP net income and earnings per share, the company expects to exclude $1 to $1.5 million of charges related to separation and restructuring from the GAAP results
Conference Call and Webcast
Verigy's management will present more details on its fourth quarter and fiscal year 2007 financial results on a conference call with investors today beginning at 1:30 p.m. (Pacific). This event will be webcast live in listen-only mode. Listeners may log on at
http://investor.verigy.com and select "Q4 and Fiscal Year 2007 Verigy Earnings Conference Call" in the "Webcasts & Presentations" section. The webcast will remain available on the company's Web site for seven days.
A telephone replay of the conference call will be available from 4:30 p.m. (Pacific) today through December 11, 2007. The replay number is +1 888-286-8010 toll-free, or international callers may dial +1 617-801-6888; enter pass code 85028727.
Financial Tables for Fourth Quarter 2007
About Verigy
Verigy designs, develops, manufactures, sells and services advanced test systems and solutions for the memory and system-on-chip segments of the semiconductor industry. Verigy's scalable platform systems are used by leading semiconductor companies worldwide in design validation, characterization, and high volume manufacturing test. Formerly part of Agilent Technologies, the company began doing business as Verigy on June 1, 2006, and completed its initial public offering on June 13, 2006. Information about Verigy can be found at
www.verigy.com.
Forward-Looking Statements
In our earnings release, some of the comments are forward-looking, including statements regarding Verigy’s future revenue and earnings; guidance for the first quarter; and other statements that express the company’s expectations, beliefs, plans and forecasts. Words such as expect, anticipate, intend, plan, believe, estimate and variations of such words and similar expressions may identify additional forward-looking statements. These forward-looking statements are based on current information and estimates, and are not guarantees of future performance or events. These statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. The risks and uncertainties include, but are not limited to, unforeseen changes in demand for semiconductors and thus for semiconductor test solutions, the strength of our customers’ businesses, and unforeseen changes in the demand for current and new products and technologies. Additional factors that may cause results to differ materially from those in the forward-looking statements are discussed in our Quarterly Report on Form 10-Q for the quarter ended July 31, 2007. The forward-looking statements, including guidance, are only valid as of this date, and Verigy undertakes no duty to update any forward-looking statements.
Information About Non-GAAP Measures
Our management uses non-GAAP measures to evaluate the operating performance of the company. By eliminating the separation and restructuring charges associated with Verigy’s spin-off from Agilent Technologies and income tax expense related to the recent changes in the German statutory tax rate, management believes it is better able to assess the operating performance of the business. Since management finds the non-GAAP information to be useful, we believe that our investors also benefit from seeing our results “through the eyes†of management in addition to seeing our GAAP results. This information also facilitates our management’s internal comparisons to our historical operating results as well as to the operating results of our competitors. A reconciliation between our GAAP and non-GAAP results is provided in the attached tables. Readers are reminded that non-GAAP numbers are merely a supplement to, and not a replacement for, GAAP financial measures. They should be read in conjunction with the GAAP financial measures.
View all Verigy press releases here.
Investor Contact:
Judy Davies
VP, Investor Relations
+1 (408)864.7549
Media Contact:
Jana Knezovich
Media Relations Manager
+1 (408)864.7549
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