Semiconductor equipment company Cabot Microelectronics Corporation (CCMP) Thursday reported a substantial rise in profit for the first quarter, driven by a 55% surge in revenue, enchanced by Epoch Material Co. Ltd. acquisition, and improved margins. Earnings on a per-share basis exceeded analysts' estimates by a wide margin. For the quarter, net income soared to $13.12 million or $0.56 per share from $116 thousand or $0.01 per share in the same quarter last year. On an average, five analysts polled by Thomson Reuters expected the company to earn $0.41 per share for the quarter. Analysts' estimates typically exclude special items.
Revenue for the period increased 55% to $97.67 million from $63.02 million in the year-earlier period, helped by strong demand, particularly from manufacturers of memory devices, as well as contributions from Epoch Material. Three analysts were looking for revenues of $90.02 million for the quarter.
Gross profit as a percentage of revenue grew to 51.6% from 45.6% in the same quarter a year ago, primarily due to increased utilization of manufacturing capacity on significantly higher demand. The company also raised its full year 2010 gross profit margin guidance to a range of 46% to 50% compared to the previous estimate of 46% to 48%.
"With semiconductor device inventories at relatively low levels and bullish outlooks reported from a number of our customers, we are optimistic about the continued strength of semiconductor device demand in calendar 2010. Additionally, we are commercializing innovative new products that we believe will further build upon our positive momentum," said William Noglows, Chairman and Chief Executive Officer. CCMP closed Wednesday's regular trading at $32.43 per share on the Nasdaq.
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