EXHIBIT 99.1

PRESS RELEASE

                                                                           Contact:

                                                                         Trisha Tuntland

                                                                        Manager of Investor Relations

                                                                        Cabot Microelectronics Corporation

                                                                           (630) 499-2600

CABOT MICROELECTRONICS CORPORATION REPORTS

RESULTS FOR SECOND QUARTER OF FISCAL 2014

                  Revenue of $99.5 Million, In Line with Industry Demand Patterns

                  Gross Profit Margin of 46.8 Percent of Revenue; Non-GAAP 48.9 Percent, Excluding Asset Impairment Charge

                  Earnings Per Share of 40 Cents; Non-GAAP 46 Cents, Excluding Impairment

                  Increase in Authorized Share Purchase Program to $150 Million from Previously Remaining $62 Million

AURORA, IL, April 24, 2014 – Cabot Microelectronics Corporation (Nasdaq:  CCMP), the world's leading supplier of chemical mechanical planarization (CMP) polishing slurries and a growing CMP pad supplier to the semiconductor industry, today reported financial results for its second quarter of fiscal 2014, which ended March 31, 2014.

Total revenue during the second fiscal quarter was $99.5 million.  This reflects a decrease of 0.9 percent compared to the same quarter last year due to continued softness in demand within the global semiconductor industry.  The company recorded a gross profit margin of 46.8 percent of revenue in the second fiscal quarter, which includes the adverse effect of a $2.1 million asset impairment charge; non-GAAP gross profit margin was 48.9 percent of revenue, excluding this impairment, which is 70 basis points higher than in the same quarter last year.  The company recorded diluted earnings per share of $0.40 for the second fiscal quarter.  Excluding the impairment charge, non-GAAP diluted earnings per share were $0.46, which represents an increase of 15.0 percent compared to the prior year quarter.  The company's balance sheet reflects a cash balance of $239.1 million and $157.5 million of debt outstanding as of March 31, 2014.  During the quarter, the company purchased $20.0 million of stock under its share repurchase program, compared to $10.0 million in the same quarter last year.

"We are pleased with our solid financial performance this quarter in light of continued soft demand within the global semiconductor industry," said William Noglows, Chairman and CEO of Cabot Microelectronics.  "Within this environment, and excluding the impact of an asset impairment charge this quarter, we improved our gross margin, and also grew our net income by 23 percent year-over-year, on slightly lower revenue; on this basis, we have now expanded gross margins year-over-year for five consecutive quarters."

Mr. Noglows continued, "As a result of our intensive focus on supporting our customers, as well as excellence in our global supply chain management and in our quality systems, during the quarter we earned a number of awards from our customers for our performance in 2013.  We are proud to have earned Intel's most prestigious award for suppliers, the Supplier Continuous Quality Improvement Award, for the second consecutive year.  In addition, we are honored to have received SMIC's Best Quality Award, HHGrace's Best Service Supplier Award, and Huali's Outstanding Supplier Award.  Our close collaborations with our customers in China resulted in approximately 23 percent revenue growth there compared to the same quarter last year.  We look forward to continuing our efforts to consistently exceed our customers' requirements."

Mr. Noglows concluded, "Through our strong historical financial performance, we have established a track record of delivering significant value to our shareholders, and in further support of this our Board of Directors has authorized an increase in our existing share repurchase program to $150 million from the previously remaining level of $62 million.  We remain committed to continuing to provide value to our shareholders."

Total second fiscal quarter revenue of $99.5 million represents a 0.9 percent decrease from the $100.4 million reported in the same quarter last year.  The company believes revenues reflect continued soft demand within the global semiconductor industry that began to appear late in the fourth fiscal quarter of 2013, as well as a $1.0 million adverse impact associated with foreign exchange rate changes, primarily the weaker Japanese yen versus the U.S. dollar.  Compared to the same quarter last year, revenue from the company's CMP slurry products for polishing aluminum, tungsten and advanced dielectrics increased, and the company's CMP polishing pads business achieved revenue growth of 4.8 percent.  Revenue from all other major business areas decreased.  Revenue for the first half of the fiscal year totaled $200.0 million, which is 3.3 percent lower than in the prior year.  Year to date revenue includes a $2.8 million adverse impact associated with foreign exchange rate changes, primarily the weaker Japanese yen.

Gross profit, expressed as a percentage of revenue, was 46.8 percent this quarter, which includes a $2.1 million asset impairment charge related to certain manufacturing assets.  Excluding the impairment charge, non-GAAP gross profit was 48.9 percent of revenue, which is 70 basis points higher than the 48.2 percent of revenue reported in the same quarter a year ago.  Other factors impacting gross profit this quarter compared to last year include benefits associated with a weaker Japanese yen and lower incentive compensation costs, partially offset by higher variable manufacturing costs, including higher raw material costs.  Year to date, gross profit represented 47.1 percent of revenue.  Excluding the impairment charge, year to date non-GAAP gross profit was 48.1 percent, which represents a 50 basis point improvement over the first six months of fiscal 2013.  In light of first half results, including the impairment, the company currently expects its gross profit for the full fiscal year to be near the lower end of its guidance range of 48 to 50 percent of revenue.

Operating expenses, which include research, development and technical, selling and marketing, and general and administrative expenses, were $31.9 million in the second fiscal quarter, or $2.5 million lower than the $34.4 million reported in the same quarter a year ago, primarily due to lower staffing related costs, including incentive compensation costs.  Year to date, total operating expenses were $63.9 million, or 5.7 percent lower than the previous fiscal year.  The company is lowering its full fiscal year guidance range for operating expenses to $127 million to $131 million; this is $4 million lower than the company's prior guidance range of $131 million to $135 million.

Net income for the quarter was $10.1 million, or $11.6 million on a non-GAAP basis, excluding the referenced asset impairment, up from $9.4 million reported in the same quarter last year.  Net income was higher than in the same quarter last year, primarily due to lower operating expenses, partially offset by a lower gross profit margin.  Year to date, net income was $21.4 million.  Excluding the asset impairment, year to date non-GAAP net income was $22.9 million, which is up 19.6 percent compared to the prior year.  Last year's results include an adverse $1.7 million foreign tax adjustment.

 

 

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Diluted earnings per share were $0.40 this quarter, or $0.46 on a non-GAAP basis, excluding the asset impairment, compared to $0.40 reported in the second quarter of fiscal 2013.  Year to date, diluted earnings per share were $0.86, or $0.92 on a non-GAAP basis, excluding the impairment, compared to $0.81 last year, which included the adverse impact of $0.07 due to last year's foreign tax adjustment.

On April 22 the company's Board of Directors authorized an increase in the company's existing share repurchase program to $150 million, from the previously remaining approximately $62 million, which is consistent with the company's strategy to return value to shareholders.  Over the last decade, the company has purchased roughly $270 million of stock under several share repurchase programs, and also distributed approximately $347 million to shareholders in 2012 as a special cash dividend as part of the company's capital management initiative.  The company's key priorities for capital allocation continue to be funding organic growth opportunities, share repurchases and acquisition opportunities in closely related areas.

 

 

CONFERENCE CALL

Cabot Microelectronics Corporation's quarterly earnings conference call will be held today at 9:00 a.m. Central Time.  The conference call will be available via live webcast and replay from the company's website, www.cabotcmp.com, or by phone at (877) 359-9508.  Callers outside the U.S. can dial (224) 357-2393.  The conference code for the call is 24389352.  A transcript of the formal comments made during the conference call will also be available in the Investor Relations section of the company's website.

USE OF NON-GAAP FINANCIAL INFORMATION

The company presented the following measures considered as non-GAAP by the U.S. Securities and Exchange Commission:  gross profit margin, net income and diluted earnings per share excluding the effects of an asset impairment charge related to certain manufacturing assets.  The non-GAAP financial information provided in this press release is a supplement to, and not a substitute for, the company's financial results presented in accordance with U.S. GAAP.  These non-GAAP financial measures are provided to enhance the investor's understanding about the company's ongoing operations.  Specifically, the company believes the asset impairment charge is not indicative of its core operating results, and thus presents its gross profit margin, net income and diluted earnings per share excluding the effects of such asset impairment charge.  The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for results prepared and presented in accordance with U.S. GAAP.  A reconciliation table of GAAP to non-GAAP gross profit percentage, net income and diluted earnings per share is contained in this press release.

ABOUT CABOT MICROELECTRONICS CORPORATION

Cabot Microelectronics Corporation, headquartered in Aurora, Illinois, is the world's leading supplier of CMP polishing slurries and a growing CMP pad supplier to the semiconductor industry.  The company's products play a critical role in the production of advanced semiconductor devices, enabling the manufacture of smaller, faster and more complex devices by its customers.  The company's mission is to create value by developing reliable and innovative solutions, through close customer collaboration, that solve today's challenges and help enable tomorrow's technology.  Since becoming an independent public company in 2000, the company has grown to approximately 1,050 employees on a global basis.  For more information about Cabot Microelectronics Corporation, visit www.cabotcmp.com or contact Trisha Tuntland, Manager of Investor Relations at 630-499-2600.

SAFE HARBOR STATEMENT

This news release may include statements that constitute "forward looking statements" within the meaning of federal securities regulations.  These forward-looking statements include statements related to:  future sales and operating results; company and industry growth, contraction or trends; growth or contraction of the markets in which the company participates; international events, regulatory or legislative activity, or various economic factors; product performance; the generation, protection and acquisition of intellectual property, and litigation related to such intellectual property; new product introductions; development of new products, technologies and markets; natural disasters; the acquisition of or investment in other entities; uses and investment of the company's cash balance; financing facilities and related debt, payment of principal and interest, and compliance with covenants and other terms; the company's capital structure; and the construction and operation of facilities by Cabot Microelectronics Corporation.  These forward-looking statements involve a number of risks, uncertainties, and other factors, including those described from time to time in Cabot Microelectronics' filings with the Securities and Exchange Commission (SEC), that could cause actual results to differ materially from those described by these forward-looking statements.  In particular, see "Risk Factors" in the company's quarterly report on Form 10-Q for the quarter ended December 31, 2013 and in the company's annual report on Form 10-K for the fiscal year ended September 30, 2013, both filed with the SEC.  Cabot Microelectronics assumes no obligation to update this forward-looking information.

 

 

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CABOT MICROELECTRONICS CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited and amounts in thousands, except per share amounts)
		Quarter Ended												Six Months Ended
		March 31,				December 31,				March 31,				March 31,				March 31,
		2014				2013				2013				2014				2013
Revenue		$	99,456			$	100,515			$	100,364			$	199,971			$	206,897
Cost of goods sold			52,931				52,801				52,019				105,732				108,513
Gross profit			46,525				47,714				48,345				94,239				98,384
Operating expenses:
Research, development & technical			14,364				14,571				15,073				28,935				30,389
Selling & marketing			6,471				6,707				7,046				13,178				14,155
General & administrative			11,076				10,726				12,287				21,802				23,241
Total operating expenses			31,911				32,004				34,406				63,915				67,785
Operating income			14,614				15,710				13,939				30,324				30,599
Interest expense			843				872				872				1,715				1,825
Other income, net			103				617				463				720				1,317
Income before income taxes			13,874				15,455				13,530				29,329				30,091
Provision for income taxes			3,779				4,147				4,110				7,926				10,968
Net income		$	10,095			$	11,308			$	9,420			$	21,403			$	19,123
Income available to common shareholders		$	9,962			$	11,181			$	9,420			$	21,200			$	19,123
Basic earnings per share		$	0.42			$	0.47			$	0.41			$	0.89			$	0.84
Weighted average basic shares outstanding			23,982				23,590				22,974				23,775				22,914
Diluted earnings per share		$	0.40			$	0.45			$	0.40			$	0.86			$	0.81
Weighted average diluted shares outstanding			24,897				24,623				23,871				24,749				23,755

 

 

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CABOT MICROELECTRONICS CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited and amounts in thousands)
		March 31,				September 30,
		2014				2013
ASSETS:
Current assets:
Cash and cash equivalents		$	239,147			$	226,029
Accounts receivable, net			53,133				54,640
Inventories, net			71,574				63,786
Other current assets			26,093				21,257
Total current assets			389,947				365,712
Property, plant and equipment, net			106,178				111,985
Other long-term assets			70,392				76,809
Total assets		$	566,517			$	554,506
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable		$	14,331			$	16,663
Current portion of long-term debt			13,125				10,938
Accrued expenses, income taxes payable and other current liabilities			24,191				39,899
Total current liabilities			51,647				67,500
Long-term debt, net of current portion			144,375				150,937
Other long-term liabilities			10,172				8,992
Total liabilities			206,194				227,429
Stockholders' equity			360,323				327,077
Total liabilities and stockholders' equity		$	566,517			$	554,506

 

 

 

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