Ultra Clean Holdings drops despite big jump in Q1 earnings and revenue
After hitting a 52-week-high, Ultra Clean Holdings Inc. (Nasdaq: UCTT) saw its stock plummet on heavy volume in after-hours trading today despite recording record revenue and higher earnings for the first quarter.
For the three months ended March 31, the Menlo Park, Calif.-based manufacturer of customized equipment used to make semiconductors posted net income of $5.2 million, or $0.24 per share, on revenue of $110.8 million, compared with net income of $2.1 million, or $0.12 per share, on revenue of $57.8 million a year earlier.
Three analysts polled by Thomson First Call had been expecting earnings per share of $0.27 on revenue of $108 million for the 2007 first quarter.
Ultra Clean’s stock dropped $3.04, or by 15.5%, to $16.56 in after-hours trading on the disappointing results. By 7 p.m. ET, nearly 1 million shares had changed hands, compared with average daily volume of 526,486 shares.
Earlier in the day, Ultra Clean’s stock had reached a 52-week-high of $19.99. It posted its 52-week-low of $7.36 on July 21, 2006.
The firm said first quarter 2007 operating expenses included an approximate $800,000, or $0.03 per share, sequential increase in legal and consulting charges largely associated with its first year of compliance with Sarbanes-Oxley. It also said a short-term product mix shift impacted gross margins.
Ultra Clean chairman and CEO Clarence Granger said the firm expects to “quickly return” to expanding its gross margin as a percent of revenue through expanded market presence and increased utilization of its Shanghai facility.
Looking ahead, Granger predicted earnings per share in the range of $0.20 and $0.26 on revenue of $100 million and $110 million for the second quarter. He cited a “moderate slowdown” in the industry behind the projection.
Analysts were expecting earnings per share of $0.29 on revenue of $111.4 million for that three-month period.
