Applied Films Corporation Reports Continued Revenue and Income Growth for Q2 Fiscal 2000
Applied Films Corporation reported improved results for its fiscal 2000 second quarter and six month period ended January 1, 2000. For the fiscal 2000 second quarter, net sales were $8.3 million versus $7.4 million reported in the fiscal 2000 first quarter and $6.2 million for the fiscal 1999 second quarter ended January 2, 1999, representing improvements of 12 percent and 34 percent respectively.
Net income for the second quarter of fiscal 2000 rose 502% to $674,000, or $0.18 per diluted share from $112,000, or $0.03 per diluted share, for the fiscal 2000 first quarter. This compares with a net loss of $(312,000), or $(0.09) per diluted share, for the fiscal 1999 second quarter. Net income improved with the aid of the elimination of the provision for income taxes previously recorded in fiscal 1999 and the first quarter of fiscal 2000 on its China Joint Venture earnings resulting in a net tax benefit of $343,000 for the second quarter, which is $0.09 per diluted share. The Company reported pre tax net income of $331,000 representing 35 percent growth over the prior quarter.
During fiscal year 2000, the Company determined that the earnings from its China Joint Venture for production of thin film coatings would not be distributed to the Company for the foreseeable future, therefore a provision for U.S. income taxes on the earnings in the Joint Venture need not be provided. During fiscal year 1999, the Company accrued for income taxes to be paid on the earnings in the Joint Venture at a rate of 34 percent. Based on the fiscal year 2000 determination, the taxes originally provided during fiscal year 1999, as well as those provided through the first quarter of fiscal year 2000, were reversed in the second quarter of fiscal year 2000. This resulted in the tax benefit of $343,000, or $0.09 per diluted share recorded in the second quarter of fiscal year 2000.
For the six months ended January 1, 2000, net sales were $15.7 million versus $15.5 million for the six months ended January 2, 1999. Net income for the six months ended was $785,000, or $0.22 per diluted share, compared to a net loss of $(529,000), or $(0.15) per diluted share, for the same period in fiscal 1999.
"We have experienced increased demand for our STN products as the market strengthened throughout the second quarter. This was evidenced by a 13 percent increase in sales of coated glass over the prior quarter and 44 percent from the same period last year," stated Tom Edman, president and chief executive officer. "We have benefited from growth in the cellular phone market because we have a strong manufacturing infrastructure in the U.S. and at our Joint Venture in China."
"Applied Film's Joint Venture with Nippon Sheet Glass in Suzhou, China is a good example of the Company's strategic positioning to benefit from these rapidly growing markets. The Joint Venture is performing well and it provided a significant contribution to this quarters results."
"We were proud to announce the signing of a contract for the sale of the first ATX-700 to a customer in Taiwan during the quarter," added Edman. "Additionally, we announced the planned sale of an existing system to support the expansion in China. These transactions will be reflected as revenue in the Company's future quarterly results of operations. We are experiencing significant interest in our Thin Film Coating Equipment and in the ATX-700 as a platform for servicing the active matrix and high end passive matrix LCD and Plasma Display markets."
Applied Films Corporation is a leading supplier of thin film coated glass and physical vapor deposition (PVD) equipment to the information technology industry, particularly the flat panel display industry. Flat panel displays are found in a wide variety of consumer and industrial products, including cellular telephones, calculators, pagers, video games, office products, and laptop computers. FPDs have also been identified as a potential replacement for the CRT in televisions and computer monitors.