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Cascade Microtech Inc. Reports Operating Results (10-Q)

August 04, 2010 | About:
10qk

10qk

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Cascade Microtech Inc. (CSCD) filed Quarterly Report for the period ended 2010-06-30.

Cascade Microtech Inc. has a market cap of $63.8 million; its shares were traded at around $4.45 with and P/S ratio of 1.2. CSCD is in the portfolios of Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Revenue in the second quarter of 2010 increased $10.8 million, or 85.8%, compared to the second quarter of 2009 and increased $3.5 million, or 17.4%, compared to the first quarter of 2010 as the global economic environment, and the semiconductor and semiconductor equipment markets in particular, continued to show improvement. Our revenues and market share in the Systems business have benefited from the acquisition of SUSS Test in January 2010. However, our net loss increased by $1.3 million, or 81.0%, compared to the second quarter of 2009 but decreased $4.5 million, or 61.4%, compared to the first quarter of 2010. These changes are primarily the result of acquisition and restructuring-related costs, and changes in other income and income tax expense. Since the SUSS Test acquisition, we have been working to restructure and integrate the combined businesses and product lines. We believe the best people, resources, products and features to meet the needs of our customers have been retained.

Revenue increased $10.8 million, or 85.8%, to $23.4 million in the three-month period ended June 30, 2010 compared to $12.6 million in the same period of 2009 and increased $19.3 million, or 80.2%, to $43.4 million in the six-month period ended June 30, 2010 compared to $24.1 million in the same period of 2009.

Systems revenue increased $10.0 million, or 160.8%, to $16.2 million in the three-month period ended June 30, 2010 compared to $6.2 million in the same period of 2009 and increased $16.5 million, or 133.9%, to $28.8 million in the six-month period ended June 30, 2010 compared to $12.3 million in the same period of 2009.

Probes and Sockets revenue increased $0.9 million, or 13.5%, to $7.3 million in the three-month period ended June 30, 2010 compared to $6.4 million in the same period of 2009 and increased $2.8 million, or 24.0%, to $14.6 million in the six-month period ended June 30, 2010 compared to $11.8 million in the same period of 2009. These increases were primarily the result of increased unit sales driven by the overall improvement in semiconductor design and production markets.

Cost of sales increased $7.3 million, or 93.0%, to $15.1 million in the three-month period ended June 30, 2010 compared to $7.8 million in the same period of 2009 and increased $14.3 million, or 92.2%, to $29.7 million in the six-month period ended June 30, 2010 compared to $15.4 million in the same period of 2009. The overall increases in cost of sales for the three and six-month periods ended June 30, 2010 compared to same periods in 2009 were the result of increased sales as discussed above and changes in gross margin as discussed below.

Systems gross margins were 34.5% and 29.0%, respectively, in the three and six-month periods ended June 30, 2010 compared to 33.6% and 33.8%, respectively, in the comparable periods of 2009. Gross margins were positively affected in the three and six-month periods ended June 30, 2010 by changes in sales mix and increase in average selling prices as described above, as a larger number of high-end systems were sold. Gross margins in the three and six-month periods ended June 30, 2010 were negatively affected by inventory valuation charges of $0.4 million and $1.4 million, respectively, compared to $0.2 million and $0.3 million, respectively, in the same periods of 2009. Inventory charges for the six-month period ended June 30, 2010 included restructuring charges of $1.0 million in the first quarter of

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