AMIS Holdings, Inc. Reports First Quarter 2005 Results.POCATELLO, Idaho Pocatello (IPA: [po kə tɛ lo]) is the county seat and largest city of Bannock CountyGR6 -- AMIS A·mis , Kingsley 1922-1995. British writer best known for his novels, including Lucky Jim (1954) and Jake's Thing (1978). Holdings, Inc. (Nasdaq:AMIS): --Six month backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. increased seven percent sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen --Refinancing to cut future interest expense in half AMIS Holdings, Inc. (Nasdaq:AMIS), parent company of AMI Semiconductor AMI Semiconductor is a company engaged the design and manufacture of customer specific integrated circuit solutions, including solutions for the automotive, medical and industrial markets. Among its products are products that integrate processing of analog and digital signals. , a leader in the design and manufacture of integrated mixed-signal solutions, today reported results for the first quarter ended April 2, 2005. Financial Results First quarter 2005 revenue was $115.9 million, a decrease of six percent sequentially and 10 percent below the first quarter of last year. Gross margin for the first quarter of 2005 was 46.4 percent, a decrease of 270 basis points sequentially, but an increase of 40 basis points year over year. Operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: was 13.0 percent in the first quarter of 2005, an increase of 210 basis points sequentially. Excluding amortization of acquisition related intangibles Property that is a "right" such as a patent, Copyright, or trademark, or one that is lacking physical existence, such as good will. and costs related to our previously announced restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). program, on a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis, operating margin was 14.3 percent, a decrease of 480 basis points sequentially and 320 basis points year over year. The Company reported a net loss for the first quarter of 2005 of $11.1 million, or $0.13 per share, compared to net income of $7.3 million, or $0.08 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share for the fourth quarter of 2004 and net income of $13.5 million or $0.16 per diluted share in the first quarter of 2004. First quarter net income includes pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charges of $28.0 million relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc costs associated with the tender and redemption The liberation of an estate in real property from a mortgage. Redemption is the process by which land that has been mortgaged or pledged is bought back or reclaimed. It is accomplished through a payment of the debt owed or a fulfillment of the other conditions. of the Company's 10 3/4 percent senior subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. notes which was completed on April 1, 2005, and $6.8 million for the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of deferred financing and other costs associated with the prior senior credit facility and the notes. Excluding these charges and other aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. items, pro forma net income in the first quarter of 2005 was $10.6 million or $0.12 per diluted share, compared to pro forma net income of $14.2 million or $0.16 per diluted share in the fourth quarter of 2004 and pro forma net income of $13.6 million, or $0.16 per diluted share in the first quarter of 2004. "Market conditions were as difficult as expected in the first quarter," said Christine King Christine Elizabeth King is a British historian and university administrator. She is currently Vice-Chancellor and Chief Executive of Staffordshire University.[1] , president and chief executive officer. "However we are encouraged by order strength we saw later in the quarter. Our six month backlog increased seven percent to $108 million in the first quarter, and we believe first quarter will represent the trough Trough The stage of the economy's business cycle that marks the end of a period of declining business activity and the transition to expansion. in our quarterly revenues for the year." Cash at the end of the first quarter was $87.3 million, a decrease of $74.4 million sequentially, which includes a $75.8 million use of cash to pay for costs associated with the tender, and a reduction in long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with the refinancing Refinancing An extension and/or increase in amount of existing debt. . Capital expenditures were $3.7 million. Business Outlook "We expect our second quarter 2005 revenue to be up two to five percent as compared to first quarter," said David Henry
David Henry (b.February 24, 1975 in Denver, Colorado)is an IFBB professional bodybuilder. , senior vice president and chief financial officer. "We anticipate second quarter gross margins to be flat to up 50 basis points sequentially. On a pro forma basis, we expect operating margins will be flat to up 100 basis points sequentially. Net interest expense for second quarter is expected to be between $2.2 and $2.4 million, roughly half of first quarter net interest expense as a result of our refinancing. We expect pro forma diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of in the second quarter to be in the range of $0.12 to $0.14. We continue to expect capital expenditures for 2005 to be approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. seven percent of annual revenues. Depreciation and amortization is expected to be about $12.0 million in the second quarter." Conference Call President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Christine King along with Senior Vice President and CFO See Chief Financial Officer. David Henry will conduct a conference call on April 28, 2005 at 5 p.m. ET, to discuss the Company's earnings and operations. Investors and other interested parties may listen to a live audio webcast of the conference call by visiting the investor relations Investor relations The process by which the corporation communicates with its investors. section of the AMIS Web site at http://www.amis.com. A webcast replay will be available on the Company's Web site until close of business May 12. About AMI Semiconductor AMI Semiconductor (AMIS) is a leader in the design and manufacture of silicon solutions for the real world. As a widely recognized innovator in state-of-the-art integrated mixed-signal products, mixed-signal foundry A semiconductor manufacturer that makes chips for third parties. It may be a large chip maker that sells its excess manufacturing capacity or one that makes chips exclusively for other companies. services and structured digital products AMIS is committed to providing customers with the optimal value, quickest time-to-market semiconductor solutions. Offering unparalleled manufacturing flexibility and dedication to customer service, AMI Semiconductor operates globally with headquarters in Pocatello, Idaho, European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. corporate offices in Oudenaarde Oudenaarde (ou'dənär`də), Fr. Audenarde, commune (1991 pop. 27,162), East Flanders prov., W Belgium, on the Scheldt River. It is a textile center and a rail junction. , Belgium Belgium (bĕl`jəm), Du. België, Fr. La Belgique, officially Kingdom of Belgium, constitutional kingdom (2005 est. pop. 10,364,000), 11,781 sq mi (30,513 sq km), NW Europe. , and a network of sales and design centers located in the key markets of North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and the Asia Pacific region. For more information, please visit
the AMIS Web site at http://www.amis.com.
Forward Looking Statements Statements in this press release other than statements of historical fact are "forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. " statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The Company's future results could differ materially from the expectations discussed herein. Factors that could cause or contribute to such differences include general economic and political uncertainty, conditions in the semiconductor industry, changes in the conditions affecting our target markets, manufacturing underutilization, fluctuations in customer demand, raw material costs, exchange rates, timing and success of new products, competitive conditions in the semiconductor industry, risks associated with international operations Internal Operations (I.O., IO or I/O) is a fictional American Intelligence Agency in Wildstorm comics. It was originally called International Operations. I.O. first appeared in WildC.A.T.S. volume 1 #1 (August, 1992) and was created by Brandon Choi and Jim Lee. and the other risks and uncertainties discussed in the Company's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. Annual Report for the year ended Dec. 31, 2004, Form 10-Q Form 10-Q See 10-Q. Quarterly Reports and other reports filed with the SEC. The Company does not intend to revise or update any forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date of this press release.
AMIS Holdings, Inc.
Condensed Consolidated Statements of Operations
(In millions - Unaudited)
Three Months Ended
--------------------
April 2, March 27,
2005 2004
---------- ---------
Revenue $115.9 $128.3
Cost of revenue 62.1 69.3
---------- ---------
Gross profit 53.8 59.0
Operating expenses:
Research & development 21.0 19.6
Selling, general and administrative 16.2 17.0
Amortization of acquisition-related intangibles 1.2 0.2
Restructuring and impairment charges 0.3 --
---------- ---------
38.7 36.8
---------- ---------
Operating income 15.1 22.2
Non-operating expenses, net 39.4 4.8
---------- ---------
Income (loss) before income taxes (24.3) 17.4
Provision (benefit) for income taxes (13.2) 3.9
---------- ---------
Net income (loss) $(11.1) $13.5
========== =========
Earnings (loss) per share
Basic $(0.13) $0.16
Diluted $(0.13) $0.16
Weighted average shares
Basic 85.2 82.1
Diluted 85.2 86.3
Key Ratios & Information:
-------------------------------------------------
Gross margin 46.4% 46.0%
Operating margin 13.0% 17.3%
AMIS Holdings, Inc.
Reconciliation of Operating Income to Pro Forma Operating Income
(In millions - Unaudited)
Three Months Ended
--------------------
April 2, March 27,
2005 2004
---------- ---------
Operating income $15.1 $22.2
Adjustments to reconcile operating income to pro
forma operating income:
Amortization of acquisition-related intangible
assets 1.2 0.2
Restructuring and impairment charges 0.3 --
---------- ---------
Pro forma operating income $16.6 $22.4
========== =========
AMIS Holdings, Inc.
Reconciliation of Net Income (Loss) to Pro Forma Net Income
(In millions - Unaudited)
Three Months Ended
--------------------
April 2, March 27,
2005 2004
---------- ---------
Net income (loss) $(11.1) $13.5
Adjustments to reconcile net income (loss) to pro
forma net income:
Amortization of acquisition-related intangible
assets 1.2 0.2
Restructuring and impairment charges 0.3 --
Costs associated with the tender of 10 3/4%
notes 28.0 --
Write-off of deferred financing and other costs 6.8 --
Related tax effects (14.6) (0.1)
---------- ---------
Pro forma net income $10.6 $13.6
========== =========
AMIS Holdings, Inc.
Pro forma Condensed Consolidated Statements of
Operations
(In millions - Unaudited)
Three Months Ended
--------------------
April 2, March 27,
2005 2004
---------- ---------
Revenue $115.9 $128.3
Cost of revenue 62.1 69.3
---------- ---------
Gross profit 53.8 59.0
Operating expenses:
Research & development 21.0 19.6
Selling, general and administrative 16.2 17.0
---------- ---------
37.2 36.6
---------- ---------
Pro forma operating income 16.6 22.4
Non-operating expenses, net 4.6 4.8
---------- ---------
Income before income taxes 12.0 17.6
Provision for income taxes 1.4 4.0
---------- ---------
Pro forma net income $10.6 $13.6
========== =========
Pro forma earnings (loss) per share
Basic $0.12 $0.17
Diluted $0.12 $0.16
Weighted average shares
Basic 85.2 82.1
Diluted 87.9 86.3
Key Pro Forma Ratios
-------------------------------------------------
Pro forma gross margin 46.4% 46.0%
Pro forma operating margin 14.3% 17.5%
Pro forma condensed consolidated statements of operations are
presented because we use them as an additional measure of our
operating performance and we believe that these excluded charges
enhance comparability between current and prior periods. Pro forma net
income and pro forma earnings (loss) per share should not be
considered as alternatives to net income (loss), earnings (loss) per
share or other consolidated operations data prepared in accordance
with accounting principles generally accepted in the United States of
America, as indicators of our operating performance or as a measure of
liquidity.
AMIS Holdings, Inc.
Condensed Consolidated Balance Sheets
(In Millions)
April 2, December
31,
2005 2004
(unaudited)
----------- --------
Assets
-------------------------------------------------
Current assets:
Cash and cash equivalents $87.3 $161.7
Accounts receivable, net 74.7 78.6
Inventories 54.0 52.2
Deferred tax assets 5.9 6.5
Prepaid expenses and other current assets 24.8 30.1
----------- --------
Total current assets 246.7 329.1
Property, plant and equipment, net 192.3 199.2
Goodwill, net 16.8 16.8
Other intangibles, net 33.7 35.1
Deferred tax assets 54.5 39.6
Other long-term assets 24.1 23.4
----------- --------
Total assets $568.1 $643.2
=========== ========
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt $2.1 $1.3
Accounts payable 34.8 37.6
Accrued expenses 47.3 62.4
Income taxes payable 2.0 1.3
----------- --------
Total current liabilities 86.2 102.6
Long-term debt, less current portion 207.9 252.2
Other long-term liabilities 2.6 2.4
----------- --------
Total liabilities 296.7 357.2
Stockholder's equity:
Common stock 0.8 0.8
Additional paid-in capital 532.4 530.6
Accumulated deficit (281.7) (270.6)
Deferred stock-based compensation (0.3) (0.4)
Accumulated other comprehensive income 20.2 25.6
----------- --------
Total stockholders' equity 271.4 286.0
Total liabilities and stockholders' equity $568.1 $643.2
=========== ========
AMIS Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(In Millions)
Three Months Ended:
-----------------------
April 2, March 27,
2005 2004
(unaudited) (unaudited)
----------- -----------
Cash flows from operating activities
Net income (loss) $(11.1) $13.5
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation and amortization 12.0 10.2
Write-off of deferred financing costs 6.7 --
Amortization of deferred financing costs 0.3 0.3
Stock-based compensation expense 0.1 0.1
Provision for (benefit from) deferred income
taxes (14.7) 0.1
Changes in operating assets and liabilities:
Accounts receivable 2.1 (10.2)
Inventories (2.8) 3.3
Prepaid expenses and other assets 5.4 0.9
Accounts payable and other accrued
expenses (14.5) (9.4)
----------- -----------
Net cash provided by (used in) operating
activities (16.5) 8.8
Cash flows from investing activities
Purchases of property, plant and equipment (3.7) (9.7)
Change in restricted cash (1.5) --
Change in other assets (5.0) --
----------- -----------
Net cash used in investing activities (10.2) (9.7)
Cash flows from financing activities
Payments on long-term debt (253.5) --
Proceeds from bank borrowings 210.0 --
Deferred financing costs (2.7) --
Proceeds from exercise of stock options 1.8 0.2
----------- -----------
Net cash provided by (used in) financing
activities (44.4) 0.2
Effect of exchange rate changes on cash and
cash equivalents (3.3) (1.7)
----------- -----------
Net decrease in cash and cash equivalents (74.4) (2.4)
Cash and cash equivalents at beginning of
period 161.7 119.1
----------- -----------
Cash and cash equivalents at end of period $87.3 $116.7
=========== ===========
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