BENCHMARQ Reports First Quarter 1998 Financial Results; Total Revenues Down; Battery Management Revenues Up 28% Year-over-Year.DALLAS--(BUSINESS WIRE)--April 20, 1998--BENCHMARQ Microelectronics microelectronics, branch of electronic technology devoted to the design and development of extremely small electronic devices that consume very little electric power. , Inc. (Nasdaq:BMRQ), a Dallas Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. , Texas-based provider of integrated circuits Integrated circuits Miniature electronic circuits produced within and upon a single semiconductor crystal, usually silicon. Integrated circuits range in complexity from simple logic circuits and amplifiers, about 1/20 in. (1. (ICs) and electronic modules for portable and power-sensitive electronic systems, reported a decrease in total revenues; however, revenue from its Battery Management Products (BMPs) increased for the three-month period ended March 31, 1998 compared with the same period last year. Total net revenue for the three-month period ended March 31, 1998 was $9,310,000. This represents a decrease in total net revenues of 11% and 21% as compared to the three-month periods ended December 31, 1997 and March 31, 1997, respectively. Pretax income pretax income Reported income before the deduction of income taxes. Pretax income is sometimes considered a better measure of a firm's performance than aftertax income because taxes in one period may be influenced by activities in earlier periods. for the three-month period ended March 31, 1998 was $557,000 compared with $2,506,000 sequentially and $2,567,000 for the same period in 1997. Included in the 1998 results are $575,000 of merger-related costs. Net income for the three-month period ended March 31, 1998 was $282,000 compared with $1,654,000 for the three-month period ended December 31, 1997 and $1,643,000 for the three-month period ended March 31, 1997. The Company employed an effective tax rate of 49% during the three-month period ended March 31, 1998. This rate was substantially higher than the effective tax rates of 34% and 36% used during the three-month periods ended December 31, 1997 and March 31, 1997, respectively. The rate increase was primarily due to a portion of the Company's costs related to the pending merger of the Company with a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Unitrode Corporation (Unitrode) not being tax deductible That which may be taken away or subtracted. In taxation, an item that may be subtracted from gross income or adjusted gross income in determining taxable income (e.g., interest expenses, charitable contributions, certain taxes). . 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 for the three-month period ended March 31, 1998 were 4 cents, compared with 21 cents for the same period in 1997. Excluding the effect of merger-related costs, diluted earnings per share for the three-month period ended March 31, 1998 would have been 10 cents. Al Schuele, President and Chief Executive Officer of the Company, commenting on the quarter, said, "We are disappointed with the overall results of the quarter. In what has traditionally been a soft quarter for BENCHMARQ, we have also been affected by many of the same market conditions that have plagued most of the industry. These conditions appear to be continuing into the second quarter and, as a result, we remain cautious. "Nonetheless, our battery management revenues, which contributed 65% of the Company's revenues for the quarter, grew by more than 28% year-over-year, reflecting our ability to implement our strategy of growing and strengthening this product line. Design-in activity in all areas of our battery management product line was very high during the March quarter and continues to increase our confidence in the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. growth potential for this business. We will continue to focus on developing new products and helping our customers complete new designs. We are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that our results will improve as the general market conditions improve. "The value of our strategic merger with Unitrode is being further reinforced as we progress toward completion. The magnitude of the combined market opportunity that avails itself to us as we merge the technology, products, and resources of the two companies is very exciting." The Company reported that the 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. of orders for BMPs at the end of the first quarter of 1998 was $3.4 million compared to $4.7 million at the end of the fourth quarter of 1997. Backlog for Integrated Battery Products was $1.6 million at the end of the first quarter of 1998, compared with $3.0 million at the end of the fourth quarter of 1997. The Company includes in its reported backlog all released written purchase orders scheduled for shipment within the next six months. -0-
BENCHMARQ Microelectronics, Inc.
Condensed Consolidated Statements of Operations
All data are in thousands, except per-share data
Three Months Ended Mar. 31,
1998 1997
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Revenues:
Battery Management Products $6,075 $4,731
Integrated Battery Products/a 3,147 6,869
Royalties/Other 88 112
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Total Net Revenue 9,310 11,712
Cost of Sales 4,770 5,814
Gross Margin 4,540 5,898
Operating Expenses:
Research & Development 891 816
Sales, General & Administrative 2,676 2,645
Merger-Related Costs 575 --
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Total Operating Expenses 4,142 3,461
Income from Operations 398 2,437
Other Income, net 159 130
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Income Before Provision for Taxes 557 2,567
Income Tax Provision 275 924
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Net Income $ 282 $1,643
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Basic Earnings Per Share $ 0.04 $ 0.24
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Diluted Earnings Per Share $ 0.04 $ 0.21
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Weighted Average Shares Outstanding 7,072 6,789
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Weighted Average Shares
Outstanding Assuming Dilution 7,667 7,673
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/a The Integrated Battery Products category consists of
Real-Time Clock (RTC) ICs and modules, NVSRAM modules, and
nonvolatile controller ICs and modules.
BENCHMARQ Microelectronics, Inc.
Condensed Consolidated Balance Sheets
All data are in thousands
Mar. 31, 1998 Dec 31, 1997
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Assets:
Cash and Investments $20,382 $19,944
Accounts Receivable, net 4,050 4,602
Inventory, net 5,454 4,692
Deferred Tax Asset 858 858
Prepaid Expenses/Other Assets 2,165 1,827
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Total Current Assets 32,909 31,923
Net Plant, Property, and Equipment 5,557 5,487
Prepayment for Product Purchases/Other 3,410 3,438
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Total Assets $41,876 $40,848
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Liabilities and Stockholders' Equity:
Current Liabilities $5,995 $5,391
Non-Current Liabilities 1,042 1,233
Stockholders' Equity 34,839 34,224
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Total Liabilities and Stockholders' Equity $41,876 $40,848
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BENCHMARQ's product lines include battery management ICs and modules, and integrated battery products, which includes RTC See real time clock. ICs and modules, and NVSRAM NVSRAM Non-Volatile Static Random Access Memory NVSRAM Non Volatile Storage Ram modules and nonvolatile controller ICs and modules. BENCHMARQ markets its products worldwide through a network of distributors and independent manufacturers' representatives Manufacturers representatives (reps), also known as sales agents, are independently owned and managed sales companies that are an alternative to hiring a direct sales force. . The statements contained in this press release relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc backlog, tax provisions, product demand, market conditions and opportunities, product developments and second quarter and annual outlook constitute forward looking 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 and various factors may impact upon such statements, including, without limitation, (i) certain of the risks detailed from time-to-time in the Company's filings with the SEC, including, without limitation, its: prospectus, dated December 1, 1995, as supplemented on December 21, 1995; Annual Report on 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. for the fiscal year ended December 31, 1997, (ii) inability of the Company to satisfy its production/delivery obligations due to disruption disruption /dis·rup·tion/ (dis-rup´shun) a morphologic defect resulting from the extrinsic breakdown of, or interference with, a developmental process. of production, (iii) inability to obtain raw materials, (iv) cancellation of orders by customers, (v) changes in the credit worthiness of customers, (vi) political and/or economic disruption in the markets for the Company's products, (vii) changes in demand for the Company's products, (viii) changes in pricing for the Company's products, (ix) obsolescence ob·so·les·cent adj. 1. Being in the process of passing out of use or usefulness; becoming obsolete. 2. Biology Gradually disappearing; imperfectly or only slightly developed. of the Company's products, (x) expenses related to legal disputes and adverse legal rulings in such disputes, (xi) inability of the Company to timely complete the development of certain of its products, (xii) inability of the Company to manage its effective income tax rate, (xiii) inability of the Company to utilize or renegotiate re·ne·go·ti·ate tr.v. re·ne·go·ti·at·ed, re·ne·go·ti·at·ing, re·ne·go·ti·ates 1. To negotiate anew. 2. To revise the terms of (a contract) so as to limit or regain excess profits gained by the contractor. its option wafers wafers compressed roughage in flat plates useful for feeding to animals in transit. under its wafer (1) A small, thin continuous-loop magnetic tape cartridge that has been used from time to time for data storage and specialized applications. (2) The base unit of chip making. It is a slice taken from a salami-like silicon crystal ingot up to 12" (300mm) in diameter. supply arrangements, (xiv) inability to realize the anticipated benefits of the proposed merger with a wholly owned subsidiary of Unitrode, and (xv) disruption of the Company's business resulting from the proposed merger. Statements contained herein are made as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" and the Company assumes no responsibility for updating such information. -0- Please refer financial inquiries to Investor Relations Investor relations The process by which the corporation communicates with its investors. BENCHMARQ Microelectronics, Inc. c/o Shelton Associates, Inc. Galleria Tower I 13355 Noel Rd., Suite 1345, LB83 Dallas, TX 75240 USA Fax: 972/774-4577 Tel: 972/239-5119 -0- Note to Editors: BENCHMARQ is a registered trademark of BENCHMARQ Microelectronics, Inc. CONTACT: BENCHMARQ Microelectronics, Inc., Dallas Patricia H. Smith, 972/437-9195 Fax: 972/437-9198 Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the : http://www.benchmarq.com |
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