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Advanced Energy Reports Solid 2008 Second Quarter Financial Results Driven by Growth in Solar Market
Fort Collins, Colo., July 23, 2008—Advanced Energy Industries, Inc. (Nasdaq GM: AEIS) today announced financial results for the second quarter ended June 30, 2008. Sales of $88.0 million were driven by a 36% sequential increase in sales to non-semiconductor markets, which reached 48% of our total sales. Sales to the solar market led the way, topping 14% of total sales for the quarter, while service revenues also hit a record high. Total second quarter sales declined 1% versus the first quarter of 2008, and declined 14.6% from $103.0 million in the second quarter of 2007, both due to the continued weakness in the semiconductor capital equipment market. Our book to bill ratio for the quarter was strong at 1.05:1.
Gross margin for the second quarter was 40.1% versus 43.6% in the second quarter of 2007 due to lower sales and the related overhead absorption. Sequentially, gross margins were fractionally down from 40.3% in the first quarter of 2008.
Net income for the second quarter of 2008 was $5.9 million, or $0.14 per diluted share, as cost reduction efforts controlled our operating expenses, compared to $11.7 million, or $0.25 per diluted share in the second quarter of 2007. Net income decreased sequentially from $6.0 million in the first quarter of 2008, but earnings per diluted share for the second quarter of 2008 were slightly higher due to shares repurchased during the quarter.
“We executed on our diversification strategy, growing non-semiconductor revenue to record levels this quarter. Sales in each of our major non-semiconductor markets demonstrated strong growth, and demand for our products in the solar market reached its highest level yet,” said Dr. Hans Betz, president and chief executive officer of Advanced Energy. “Further, we believe our ability to address these emerging markets will serve us well as we develop new applications for our technology and navigate through this cycle in the semiconductor market.”
Third Quarter 2008 Guidance
The Company anticipates third quarter 2008 results to be within the following ranges:
- Sales of $82 million to $88 million.
- Earnings per share of $0.07 to $0.12
Second Quarter 2008 Conference Call
Management will host a conference call today, Wednesday, July 23, 2008 at 5:00 pm Eastern Daylight Time to discuss Advanced Energy's financial results. Domestic callers may access this conference call by dialing 877-627-6511 and International callers may access the call by dialing 719-325-4916. Participants will need to provide the conference passcode 9067934. For a replay of this teleconference, please call 888-203-1112, or 719-457-0820 and enter the passcode 9067934. The replay will be available through 12:00 a.m. Eastern Daylight Time, July 25, 2008. A webcast will also be available on the Investor Relations webpage at http://ir.advanced-energy.com.
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About Advanced Energy
Advanced Energy® develops innovative power and control technologies that enable high-growth, plasma thin-film manufacturing processes worldwide, including semiconductors, flat panel displays, data storage products, solar cells, architectural glass, and other advanced product applications. Advanced Energy® also develops grid connect inverters for the solar energy market.
The Company’s expectations with respect to financial results for the third quarter of 2008 are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to: the volatility and cyclicality of the industries the company serves, particularly the semi-conductor industry, the timing of orders received from customers, the company's ability to realize cost improvement benefits from the global operations initiatives underway, and unanticipated changes to management's estimates, reserves or allowances. These and other risks are described in Advanced Energy's Form 10-K, Forms 10-Q and other reports and statements filed with the Securities and Exchange Commission. These reports and statements are available on the SEC's website at www.sec.gov. Copies may also be obtained from Advanced Energy's website at www.advanced-energy.com or by contacting Advanced Energy's investor relations at 970-407-6555. Forward-looking statements are made and based on information available to the company on the date of this press release. The company assumes no obligation to update the information in this press release.