Novellus misses estimates despite strong Q1

Novellus said sales for the first quarter were $365.9 million, up 10.1 percent from the fourth quarter 2005 net sales of $332.3 million and up 7.7 percent from first quarter 2005 net sales of $339.7 million.

Net income for the first quarter was $26.7 million, or $0.20 per diluted share, up 16.2 percent from the fourth quarter 2005 net income of $23.0 million, or $0.17 per diluted share, and down 12.3 percent from the first quarter 2005 net income of $30.5 million, or $0.22 per diluted share.

Wall Street was expecting $0.21 a share on sales of $352.88 million in the quarter.

The first quarter results include net pre-tax restructuring and other charges of $12.6 million. These charges include net pre-tax restructuring charges of $3.7 million and a pre-tax impairment charge in connection with the previously announced plan to disinvest certain real estate holdings of $8.9 million.

Bookings were $416.7 million in the first quarter, up 18.7 percent over fourth quarter 2005 bookings of $351.0 million. Shipments of $354.2 million in the first quarter represent an increase of $37.6 million or 11.9 percent from $316.6 million reported in the immediately preceding quarter.

"Earnings per share came in above the high end of the range we communicated in our mid-quarter update as a result of higher revenues and improved gross margins," said Richard S. Hill, chairman and chief executive of Novellus, based here, in a statement. "We remain cautiously optimistic that capacity expansion in semiconductor manufacturing will continue in a rational manner, and we look forward to further improvements in our financial metrics as the year continues."