C-Cube Sets Quarterly, Annual Revenue Records; Semiconductor Division Expanding in Three Growth Markets.Business Editors and High Tech Writers MILPITAS Milpitas (mĭl'pē`təs), city (1990 pop. 50,686), Santa Clara co., W Calif., a suburb of San Jose, southeast of San Francisco; inc. 1954. Manufactures include computers and paint. , Calif.--(BUSINESS WIRE)--Jan. 20, 2000 C-Cube C-Cube Microsystems was pioneer in video compression technology and the implementation of that technology into cost-effective semiconductors. C-Cube was the first company to deliver on the market opportunity presented by the conversion of image and video data from analog to digital Microsystems (Nasdaq:CUBE) today announced record revenues for the fourth quarter and for fiscal 1999. Revenues for the quarter totaled $115.7 million compared with $95.8 million for Q4 98 and $101.4 million for Q3 99. Total revenues for 1999 reached $407.6 million compared with $351.8 million for 1998. Net income for the fourth quarter was $18.6 million, or $0.40 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, 50% higher than the Q4 98 net income of $12.4 million, and a 33% increase over Q3 99. &uot;Our fourth-quarter financial performance highlights an excellent year for C-Cube,&uot; said the company's Chief Executive Officer Alexandre Balkanski. During the quarter, C-Cube entered into a definitive agreement to combine its wholly-owned DiviCom subsidiary with Harmonic harmonic. 1 Physical term describing the vibration in segments of a sound-producing body (see sound). A string vibrates simultaneously in its whole length and in segments of halves, thirds, fourths, etc. (Nasdaq:HLIT), and to spin off or sell its semiconductor business in a taxable transaction Taxable transaction Any transaction that is not tax-free to the parties involved, such as a taxable acquisition. prior to the close. The transaction is currently expected to close in March, 2000. During the quarter, DiviCom joined partners MediaOne MediaOne was a cable company created by U S WEST in 1995. The cable service started as a division of U S WEST Media Group. In time the service also included pay-per-view, and a self-branded high-speed cable modem internet service named Hiway1 ("Highway One"). , Canal+ and Philips (company) Philips - A Dutch multinational electronics company. It produces washing machines, consumer electronics, integrated circuits and light bulbs. Together with Sony they set the Compact Disc standard, especially Green Book CD-ROM. to launch the nation's first open digital cable-television architecture in Jacksonville, Florida “Jacksonville” redirects here. For other uses, see Jacksonville (disambiguation). Jacksonville is the largest city in the state of Florida and the county seat of Duval County. . &uot;The succession succession: see ecology. of major MSO's that have adopted DiviCom technology validate To prove something to be sound or logical. Also to certify conformance to a standard. Contrast with "verify," which means to prove something to be correct. For example, data entry validity checking determines whether the data make sense (numbers fall within a range, numeric data an accelerating trend toward a new, more open and competitive cable equipment market,&uot; said Tom Lookabaugh, President of DiviCom. &uot;We are confident we can win in an open-cable equipment market because we have the technology, partners and expertise to target each customer's specific competitive situation.&uot; &uot;C-Cube Microsystem's semiconductor division finished 1999 with excellent growth in our three key markets: DVD DVD: see digital versatile disc. DVD in full digital video disc or digital versatile disc Type of optical disc. The DVD represents the second generation of compact-disc (CD) technology. , CODEC (encoders/decoders) and digital set-top box The cable TV box that sits on "top" of the TV "set," although it is often located several feet away in an equipment rack. The set-top box descrambles the premium channels and provides a tuner for the higher cable numbers that very old TVs did not support. ,&uot; Padval said. &uot;In the CODEC market, we have developed the only consumer-priced single-chip solution for a family of recordable digital video products including digital VHS (Video Home System) A half-inch, analog videocassette recorder (VCR) format introduced by JVC in 1976 to compete with Sony's Betamax, introduced a year earlier. , DVD-Recordable and personal video recorders See DVR. . We established momentum in the growing digital satellite and cable set-top business this year with our important partners in the U.S., 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
Japan.(a) C-Cube also delivered nearly 4 million DVD chips in 1999, more
than doubling its 1998 DVD revenue and strengthening its position as an
industry leader.&uot;(a)
Other fourth-quarter business achievements include:
-- Cablevision selects DiviCom to provide digital television
head-end equipment to its largest market, the New York
metropolitan area.
-- DiviCom teams up with 21 other members of the OpenCAS consortium
to submit for standards-body approval a new set of open cable
standards that will enhance services, increase competition and
give greater choice to U.S. cable television consumers.
-- DiviCom wins a head-end deployment for the first digital MMDS
television system in China.
-- Cisco Systems selects C-Cube's new single-chip DVxpert(TM) 5120
broadcast CODEC for its Video-Over-IP Networking product, the
IP/TV 3400 Broadcast Server. The CODEC provides MPEG-1 and MPEG-2
video encoding for streaming video over the Internet.
-- C-Cube and four industry leading hardware and software companies
team up at COMDEX '99 to demonstrate the first generation of
PC/TV, TV timeshifting and video editing products based on
C-Cube's DVxplore(TM) MPEG-2 CODEC silicon.
About C-Cube C-Cube Microsystems Inc. is the industry leader in the development and delivery of highly integrated digital video silicon and systems solutions. C-Cube's Semiconductor Division delivers digital video silicon and systems solutions for the communications and consumer electronics markets. C-Cube's DiviCom Division is a leader in the deployment Installing, setting up, testing and running. This military term, which means the placement of troops and equipment in the field, is widely used with computers as an alternate to the word "implementation. of digital video networks. C-Cube is headquartered in Milpitas, California Milpitas (IPA pronunciation: mɪlpitʌs; inhabitants are called 'Milpitans') is a city in Santa Clara County, California. It is located with San Jose to its south and Fremont to its north, at the eastern end of Highway 237 and generally between Interstate freeways 680 and with offices in 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, and Asia. Its stock is traded on the Nasdaq under the symbol CUBE. C-Cube can be reached at +1.408.490.8000 or at http://www.c-cube.com. C-Cube's DiviCom Division is based in Milpitas, Calif. and can be reached at +1.408.944.6700 or at http://www.divi.com. This press release contains 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. within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results could differ materially from those projected in the forward-looking statements as a result of the risk factors set forth in the Company's Forms 10-K and 10-Q reports and in C-Cube Semiconductor Inc.'s Registration Statement on Form 10. The Company has attempted to identify forward-looking statements in this press release by placing an asterisk (1) See Asterisk PBX. (2) In programming, the asterisk or "star" symbol (*) means multiplication. For example, 10 * 7 means 10 multiplied by 7. The * is also a key on computer keypads for entering expressions using multiplication. (a) following each sentence containing such statements.
C-CUBE MICROSYSTEMS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
December 31, December 31,
1999 1998
------ -------
ASSETS
Current assets:
Cash and equivalents $ 144,296 $ 108,224
Short-term investments 175,357 99,603
Receivables - net 74,850 36,980
Inventories 19,335 16,073
Deferred taxes and other current assets 31,789 31,147
---------- ----------
Total current assets 445,627 292,027
Property and equipment - net 35,349 29,622
Production capacity rights 4,985 12,600
Distribution rights - net 1,318 1,483
Purchased technology - net 4,194 5,921
Other assets 3,892 1,518
---------- ----------
Total $ 495,365 $ 343,171
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 38,882 $ 19,942
Accrued liabilities 38,553 51,264
Current portion of long-term obligations 376 355
---------- ----------
Total current liabilities 77,811 71,561
Long-term obligations 18,291 28,207
---------- ----------
Total liabilities 96,102 99,768
Minority interest in subsidiary 471 28
Stockholders' equity:
Common stock 323,756 225,265
Accumulated other comprehensive loss (2,204) (1,852)
Retained earnings 77,240 19,962
Total stockholders' equity 398,792 243,375
---------- ----------
Total $ 495,365 $ 343,171
C-CUBE MICROSYSTEMS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Quarter Ended Year Ended
December 31, December 31,
1999 1998 1999 1998
Net revenues $115,726 $95,800 $407,648 $351,797
Costs and expenses:
Cost of revenues 50,944 44,071 181,891 160,839
Research and development 22,707 18,897 84,366 74,031
Selling, general and
administrative 18,760 16,756 69,437 60,512
------- ------- ------- -------
Total 92,411 79,724 335,694 295,382
------- ------ ------- -------
Income from operations 23,315 16,076 71,954 56,415
Other income, net 3,372 1,692 10,456 4,239
------- ------ ------- ------
Income before income taxes,
minority interest and
extraordinary item 26,687 17,768 82,410 60,654
Income tax expense 8,006 5,327 24,723 18,196
------- ------- ------ ------
Income before minority interest
and extraordinary item 18,681 12,441 57,687 42,458
Minority interest in net income
(loss) of subsidiary 61 17 442 (337)
------- ------- ------ ------
Income before extraordinary item 18,620 12,424 57,245 42,795
Extraordinary gain on buyback
of convertible notes -- -- 33 3,494
------- ------- ------ ------
Net income $18,620 $12,424 $57,278 $46,289
======= ======= ======= =======
Income per diluted share before
extraordinary item $0.40 $ 0.31 $ 1.30 $ 1.11
Extraordinary gain per
diluted share -- -- -- 0.09
-------- ------- ------- -------
Net income per diluted share $ 0.40 $ 0.31 $ 1.30 $ 1.19
Shares used in computation 47,424 40,708 44,571 40,754
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