Verigy, Ltd. (
F1Q11 Earnings Call
February 24, 2011 4:30 pm ET
Judy Davies – Vice President of Investor Relations and Marketing Communications.
Jorge Titinger – President and Chief Executive Officer.
Robert J. Nikl – Chief Financial Officer.
David Dooley – Steelhead Securities LLC
Olga Levinson – Barclays Capital
Simran Drar – Cowen and Company, LLC
Previous Statements by VRGY
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Good day, ladies and gentlemen. And welcome to the First Quarter 2011 Verigy Limited Earnings Conference Call. My name is Erica and I will be your coordinator for today. At this time, all participants are in listen-only mode. We will be facilitating a question-and-answer session towards the end of this conference. (Operator Instructions)
I would now like to introduce your host for today’s call Ms. Judy Davies, Vice President of Investor Relations and Marketing Communications. Please proceed.
Thank you, Erica, and good afternoon, everyone. Welcome to our financial teleconference for Verigy’s first quarter and fiscal year 2011, which ended January 31st. I’m joined by Jorge Titinger, our President and CEO and Bob Nikl, our CFO.
Our first quarter financial press release was sent out today via Market Wire and is posted on our website at verigy.com. If you are not able to locate the press release, or need assistance in finding the information, please contact me directly at 408-864-7549.
A replay of today’s call will be available via telephone and webcast from February 24 through March 10. You may access the replay by going to the Investor Relations section of our website.
We will be making forward-looking statements today that are based on current information and estimates and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Factors that may cause results to differ materially from those in the forward-looking statements are discussed in our most recent periodic and current reports filed with the SEC.
These forward-looking statements, including guidance, provided during today’s call and expectations regarding our proposed merger agreement with LTX-Credence and the acquisitions proposal from Adventist are only valid as of this date. Verigy undertakes no obligation to update the forward-looking statements.
In addition, during this call we will discuss non-GAAP financial measures, including non-GAAP net profit or loss, earnings or loss per share and gross margin and operating expenses. You will find reconciliation to the most directly comparable GAAP financial measures in the Investor Relations section of our website and in our press release.
At the conclusion of our prepared remarks, we will open up the call for questions, to enable us to answer all of your questions, please limit yourself to one question and not more than one follow-up. As a reminder, this conference call is being recorded.
Thank you all again, and now it is my pleasure to turn the call over to Jorge Titinger.
Thanks, Judy. Good afternoon, everyone, and thank you for joining us for our first conference call of fiscal 2011. Today I will review our Q1 highlights and talk about what we are seeing in our markets. Bob will then provide more detail on our Q1 financial performance and discuss our Q2 guidance.
First however I realize that there is a high level of continued interest in our M&A activity so I will start with that. Let me begin by providing you with an update on our pending merger with LTX-Credence.
As you all know, we are party to a merger agreement with LTX-C and we continue to uphold the terms of that agreement. The STC and the DoJ granted early termination of the rating period under Hart-Scott-Rodino Act with respect to this transaction.
The SEC’s review of the registration statement on our joint proxy statement with LTX-C is ongoing. Once this tax review has been completed it will clear the way for our shareholder vote. As we’ve said in the past we believe there are strategic value in the combination between our companies due to our complementary products our customers.
Now let me turn to the status of the Advantest proposal. Our board, management team and advisors have been in ongoing negotiations with Advantest and its advisors regarding the terms of their proposals since early December. Throughout these discussions we have stressed the importance of deal closure given the impact uncertainty can have in our customer purchasing decisions and employing morale.
Since our conversations began, the ability to obtain regulatory clearance has been a focus of our discussions. As expected last Friday the DOJ issued a second request in connection with the Advantest proposal. We believe that the second request highlights the importance to Verigy and its Stakeholders are having adequate contractual protections and acceptable terms to ensure closing of any agreed upon the sale of Verigy.
As our discussions with Adventest continue, we will remain focused on securing the best outcome for the Verigy and its shareholders. To date, the Verigy board has not withdrawn its support or recommendation in favor of the pending merger with LTX-C nor other board made final determination with respect to the Adventest proportional.
As we said previously well we continue to engage with Adventest, there can be assurances that an agreement will be reached or that our transaction will be consummated. We recognize that this is a period of uncertainty for our customer’s employees and shareholders and we appreciate everyone's patience as we work to achieve an outcome that we will believe will best serve our various stakeholders. We hope to have a resolution in the coming weeks. As we have done throughout this process we will update you on regarding permission to share.