Board Authorizes Stock Repurchase Program of up to $25 Million
Zygo Corporation (NASDAQ: ZIGO) today (August 16) announced net sales of $46.5 million and net earnings of $3.8 million, or $0.20 per diluted share, for the fourth quarter of fiscal 2007. Compared with the same period in fiscal 2006, net sales decreased by $0.7 million and net earnings decreased by $0.7 million, or $0.04 per diluted share. Earnings per diluted share for the fourth quarter of fiscal 2006 were positively impacted by $0.03 due to the recognition of one-time tax benefits related to prior year foreign trading income.
For fiscal 2007, the Company recorded net sales of $181.0 million and net earnings of $15.1 million, or $0.81 per diluted share, as compared with fiscal 2006 net sales of $168.1 million and net earnings of $14.5 million, or $0.79 per diluted share. Fiscal 2007 net sales increased 8% over fiscal 2006, as an increase in product sales of $28.8 million (19%) more than offset a decrease of $15.9 million related to the finalization of a major development services contract. This increase in product sales resulted from a strong performance across the Company's product lines. Earnings per diluted share for fiscal 2006 were positively impacted by $0.07 due to the recognition of one-time tax benefits related to prior year foreign trading income.
Bruce Robinson, ZYGO's Chairman and CEO, stated, "We are pleased with our fiscal 2007 financial results, including Company records for sales and earnings, with both the Metrology and Optics Divisions making significant contributions to our success this year. Fiscal 2007 began as a challenging year. However, continued strength in optics, semiconductor, and medical component sales more than offset the completion of the development services contract."
Highlights for the year included:
-- Record revenues of $181.0 million, which included product sales growth of 19% over the prior year.
-- Gross profit of 43% of sales was the highest since fiscal 2001.
-- An increase in EPS to $0.81, as we more than covered a $6.1 million increase in RD&E expenses.
-- Shipment of our first Back End Of Line ("BEOL") semiconductor tool anticipated to be accepted by the customer in early fiscal 2008.
Orders for the fourth quarter of fiscal 2007 were $36.1 million. Orders from the Company's Metrology Division accounted for 57% of the orders received, with the Optics Division accounting for the remaining 43%. For the full year, orders were $172.5 million, a decrease of 5% over fiscal 2006. As we have previously disclosed, orders for our lithography OEM products have experienced a sharp decline and we anticipate that this will continue through the remainder of calendar 2007. We have also seen push-outs and cancellations in the semiconductor capital equipment sector.
Commenting on fiscal 2008 expectations, Mr. Robinson said, "We expect fiscal 2008 revenues to be approximately equivalent to fiscal 2007 levels. This reflects growth in other areas of the Company offsetting the downturn in the semiconductor market. We further anticipate fiscal 2008 sales and earnings to be skewed toward the second half of the year when we believe we will see a strengthening in orders and shipments of semiconductor and display systems."
The Company also announced that its Board of Directors authorized the repurchase of up to $25.0 million of the Company's outstanding common stock. The repurchases will occur from time to time as market conditions warrant through transactions in the open market. The Company expects that the initial share repurchases will be effected pursuant to a plan in conformity with Rule 10b5-1 under the Securities Exchange Act of 1934. This rule allows public companies to adopt written, pre-arranged stock trading plans when they do not have material, non-public information in their possession. The adoption of this stock trading plan will allow the Company to repurchase its shares during periods when it otherwise might be prevented from doing so under insider trading laws or because of self-imposed trading blackout periods. -Zygo Corporation
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