Rubicon Technology, Inc. reports third quarter 2010 results, opening of two new manufacturing facilities

Nov 7th, 2010
Date Announced: 07 Nov 2010

BENSENVILLE, Ill.-- Rubicon Technology, Inc. (NASDAQ:RBCN - News), a leading provider of sapphire substrates and products to the LED, RFIC, Semiconductor, and Optical industries, today reported financial results for its third quarter ended September 30, 2010 and announced the opening of two new manufacturing facilities.

Third Quarter 2010 Financial Highlights

• Revenue rose to $20.5 million, up 30 percent sequentially
• Gross margin increased 8 percentage points to 54 percent
• Operating margin reaches 40 percent
• Diluted earnings per share nearly doubles sequentially to $0.35

Commenting on the results, Raja Parvez, President and CEO said, "We had another outstanding quarter with strong growth in revenue and earnings. Overall demand from the LED market remained strong in the quarter as our customers continued to add capacity in response to the projected rapid growth in the LED industry.”

The Company’s revenue increased 30 percent sequentially to $20.5 million in the current quarter largely due to increased pricing for sapphire substrates driven by strong demand from the LED market. The Company also reported continued strong interest for its polished six inch wafers. Mr. Parvez continued, “With the increased polishing capacity we are bringing on-line, we expect the six inch polished wafer product to become an increasingly large percentage of our total revenues.”

Fourth Quarter 2010 Guidance

Commenting on the outlook for the fourth quarter, William Weissman, Rubicon’s Chief Financial Officer said “While we have seen some softening in demand in certain geographies associated with higher TV panel inventories, overall demand remains strong and we expect prices for our sapphire products to increase in the fourth quarter by at least 15 percent on average sequentially. We also anticipate beginning to add capacity in both crystal growth and polishing in the quarter. As a result we expect revenue to increase approximately 27 percent sequentially to between $25 and $27 million. Gross margin should be in the high 50 percent range with operating margin in the mid 40 percent range. Based on a projected diluted share count of 24 million shares, we expect diluted earnings per share to be between $0.47 and $0.49.”

The Opening of Two New Factories

The Company also reported that it recently opened both its new crystal growth facility in Batavia, Illinois and its new polishing facility in Penang, Malaysia. The new crystal growth facility will be producing larger crystals allowing the Company even more flexibility in addressing the growing demand for larger diameter sapphire substrates. The new polishing facility will be responsible for the more labor intensive crystal fabrication processes and will also allow the Company to significantly expand its capacity for large diameter wafer polishing.

Mr. Parvez commented, “Combined, I believe these two new facilities give us a significant advantage in the marketplace. This combination of high volume, high quality, large diameter crystal growth and polishing capability makes us unique in the marketplace today and positions us very well to maintain our leadership position for years to come.”

About Rubicon Technology, Inc.

Rubicon Technology, Inc. is an advanced electronic materials provider that is engaged in developing, manufacturing and selling monocrystalline sapphire and other crystalline products for light-emitting diodes (LEDs), radio frequency integrated circuits (RFICs), blue laser diodes, optoelectronics and other optical applications. The Company applies its proprietary crystal growth technology to produce very high-quality sapphire in a form that allows for volume production of various sizes and orientations of substrates and windows. Rubicon is a vertically-integrated manufacturer with capabilities in crystal growth, high precision core drilling, wafer slicing, surface lapping, large-diameter polishing and wafer cleaning processes, which the Company employs to convert the bulk crystal into products with the quality and precision specified by its customers. The Company is actively developing larger diameter products to support next-generation LED, RFIC and optical window applications.

Contact
Rubicon Technology, Inc. William Weissman Chief Financial Officer 847-457-3610

E-mail:info@rubicon-es2.com

Web Site:www.rubicon-es2.com

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