MEMC, Silicon, Wafer, Semiconductor Wafer supplier MEMC cuts 2011 sales target

SAN FRANCISCO—Silicon wafer supplier MEMC Electronic Materials Inc. Wednesday (Aug. 3) reported second quarter sales and profit that handily beat analysts' expectations, but lowered its sales target for the year due to a downturn in solar and softening of demand in the semiconductor industry.   

MEMC (St. Peters, Mo.) said it now expects pro forma sales to be between $3.3 billion and $3.6 billion, down from a previous range of $3.4 billion to $3.7 billion. MEMC said it expects sales for the year in accordance with generally accepted accounting principles (GAAP) to be between $2.7 billion and $3 billion, down from an earlier guided range of $2.8 billion to $3.1 billion.

Mark Murphy, MEMC's chief financial officer, said in a conference call with analysts following the second quarter report that the company adjusted its sales target "due to the volatile market conditions during the second quarter and the impact the environment had on our various segments."

Ahmad Chatila, MEMC's president and CEO, said MEMC is seeing "wobbly demand" in from the semiconductor industry. Demand from semiconductor makers softened in June, Chatila said, but the company expects the business to substantially improve in the second half of the year compared to the first half.

MEMC reported second quarter revenue of $745.6 million, up 1 percent from the first quarter and up 66 percent from the second quarter of 2010. Second quarter revenue included a $149.4 payment from Suntech Power Holdings Co. Ltd. related to the termination of a long-term supplier agreement announced last month, MEMC said. Sales increased 33 percent year-to-year, excluding the Suntech payment, MEMC said.

MEMC reported a net income in accordance with generally accepted accounting principles (GAAP) of $47.3 million, or 21 cents per share, up from a GAAP net loss of $4.5 million in the previous quarter and a GAAP net income of $13.8 million in the year-ago quarter.  

On a non-GAAP basis, excluding charges, MEMC reported a net income of $66.2 million, or 29 cents per share. The company had a non-GAAP net income of 9 cents per share in the first quarter and 7 cents per share in the second quarter of 2010.

MEMC reported sales to the semiconductor industry of $275.3 million in the second quarter, up 9 percent from the first quarter and up 10 percent compared to the second quarter of 2010. The sequential increase was driven by higher volume due to seasonal effects and volume recovery from the March 11 earthquake off the coast of Japan, MEMC said.

MEMC, Silicon, Wafer, Semiconductor Wafer supplier MEMC cuts 2011 sales target