News

14 November 2008

 

Tegal’s revenues fall 57% quarter-to-quarter

For its fiscal second-quarter 2009 (to end-September 2008), plasma etch and deposition system maker Tegal Corp of Petaluma, CA, USA has reported revenue of $2m, down 57% on $4.7m last quarter and 81% on $10.8m a year ago. The firm attributes the drop to the general economic weakness and slowdown in capital expenditures. Net loss was $2.5m, compared to $0.8m last quarter and net income of $0.7m a year ago.

In September, Tegal acquired the deep reactive ion etch (DRIE) and plasma-enhanced chemical vapor deposition (PECVD) products (and related intellectual property) of Alcatel Micro Machining Systems (AMMS) and parent company Alcatel-Lucent for $1m plus 1,044,386 shares of Tegal’s common stock (at $3.83 per share), totally about $5m.

Correspondingly, during the quarter, inventories rose by $2.6m to $13.7m, while cash reserves fell by $4.2m to $14m. However, backlog has risen to $1.1m (currently $3.3m), including new orders for DRIE systems.

“During the final month of the quarter we signed and closed our acquisition of the DRIE and LTPECVD products from Alcatel, and we are pleased with our progress to date on integrating the acquisition [which will eventually become part of Tegal's Petaluma operation],” says president & CEO Thomas Mika. “We recently announced two system orders for both cluster and stand-alone versions of the DRIE systems, one of which has already been installed at our customer,” he adds. “These orders and a promising pipeline strengthen our belief in the long-term prospects for this business, and we will pursue this opportunity aggressively.” The AMMS acquisition doubles the size of Tegal’s market.

Nevertheless, during the quarter, Tegal initiated a 10% cut in staffing as well as other measures to reduce spending during the coming quarter, while preserving its ability to properly transition and support key growth opportunities, says Mika. Tegal had about 76 staff, including 55 in Petaluma. So far, eight production workers in Petaluma have lost their jobs, and several more positions may be cut.

“In the current tougher economic environment, we believe these steps, along with all of the profitability initiatives we have made in recent years, will help position the company to weather the storm and emerge as a stronger company,” Mika adds. “We believe that, so long as the business environment does not significantly worsen, we can improve our results measurably on a sequential basis and we look forward to an improved financial forecast in the coming quarters.”

Tegal appoints VP of global sales

Tegal has appointed Peter Dijkstra as VP of global sales. During more than 25 years of experience of implementing global sales and service strategies in the semiconductor capital equipment market, Dijkstra held senior engineering positions at FOM-AMOLF and VG Instruments (both based in the Netherlands) and spent almost 20 years at Alcatel, holding positions as field engineer, sales support engineer, and sales manager. Most recently, he was director of worldwide sales & customer support for AMMS.

“His extensive international experience will continue to open up new opportunities in applications integral to Tegal such as telecommunication, automotive, aerospace, computer peripheral, biomedical industries and semiconductors," says Mika. “Peter brings extensive sales experience and a proven track record that will drive Tegal’s competitive positioning and build on our recent success in this area.”

“Tegal has put together an impressive array of products and innovative technology,” comments Dijkstra. “I look forward to transforming Tegal’s strategic sales plans and corporate vision into a profitable reality,” he adds.

See related items:

Tegal completes acquisition of AMMS’ DRIE and PECVD product lines

Tegal’s sales hit by project postponements and cancellations

Tegal reports third consecutive quarter of profitability

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Visit: www.tegal.com