Chips and Technologies, Inc. Posts First Quarter FY'97 Increases; E.P.S. and Operating Income Surge 110% on 20% Revenues Hike; Portable PC Graphics and Video Market Leader also Posts Sequential Quarterly Gains; Earnings Increase 59% on 15% Revenues Boost; Gross Margins Improve to 48%.SAN JOSE San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif.--(BUSINESS WIRE)--Oct. 15, 1996--Chips and Technologies, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : CHPS CHPS Collaborative for High Performance Schools CHPS Certified in Healthcare Privacy and Security CHPS Center for Health Policy Studies (healthcare consulting firm with offices in New York, Maryland, and Illinois) CHPS Combat Hybrid Power System ) today reported revenues of $44.5 million and net income of $9.5 million, or $0.42 per share, for its first fiscal quarter ended Sept. 30, 1996. Chips and Technologies Chips and Technologies (C&T) was the first fabless semiconductor company, a model developed by its founder Gordon Campbell. Its first product was an EGA IBM compatible graphics chip. This was followed by chipsets for PC motherboards and other computer graphics chips. , Inc. is a leading supplier of highly integrated semiconductor and software solutions which provide graphics, video and other capabilities to portable and desktop computers. "Our earnings per share for the first quarter of fiscal 1997 surged 110% over the 20 cents posted in last year's first quarter and were up 56% over the 27 cents posted in the prior quarter," stated Jim Stafford James Wayne "Jim" Stafford (b. 16 January 1944, Eloise, Florida) is an American comedian and musician, who was prominent in the 1970s. Stafford had semi-novelty hits with the songs "Spiders and Snakes", "Swamp Witch", "Wildwood Weed", the controversial "My Girl, Bill", and "Turn , Chips' 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. . "Similarly, revenues increased 20% over last year's first quarter and 15% over the prior quarter." "During the first quarter, demand remained strong from the worldwide notebook computer A laptop computer that weighs in a range from five to seven pounds. The term originated when laptops were routinely more than 10 pounds, and those that became lighter were placed in a special "notebook" category. In practice, notebook computer and laptop computer are synonymous. market for our leadership graphics accelerators A display adapter that performs a specialized set of graphics functions to render an image on screen. Today, all display adapters provide basic rendering functions in hardware, but many have graphics processing units (GPUs) that are sophisticated computers. ," Stafford said. "We are pleased that the quarter was also characterized by strong gross margin improvement to 48%, from 39% last year and 44% the prior quarter. "Chips and Technologies is well positioned and strongly committed to sustaining our leadership on the cutting edge of new technologies," Stafford said. "Our technology partnership with Lockheed Martin's Real3D(R) organization, the leader in real-time 3D technology, is productively proceeding. This partnership, created to provide 2D/3D technology to Intel Corp. next summer, positions us to maintain our leadership position in the portable market and also opens up significant new opportunities in the desktop PC and emerging Internet markets. "Our HiQVideo(TM) family of video/graphics accelerators was featured in Toshiba's new SatellitePro(TM) and Tecra(TM) lines of notebook computers and we reaped additional significant design wins for this new generation of 64-bit products during the quarter. "Zoomed Video technology pioneered by Chips continues to gain ground since its adoption by the Zoomed Video Initiative earlier this year," Stafford noted. As the standard for video capture and display for portable computers, Zoomed Video facilitates applications such as video capture, MPEG (Moving Pictures Experts Group) An ISO/ITU standard for compressing digital video. Pronounced "em-peg," it is the universal standard for digital terrestrial, cable and satellite TV, DVDs and digital video recorders (DVRs). playback, TV tuners and video conferencing See videoconferencing. (communications) video conferencing - A discussion between two or more groups of people who are in different places but can see and hear each other using electronic communications. with multiple video streams, without adding cost to the notebook PC. Products from ZVI ZVI Zero-Valent Iron ZVI Zone of Visual Influence ZVI Zoomed Video Interface members are designed to be compatible with the Company's HiQVideo video/graphics accelerators. Most recently, the Video Electronics Standards Association See VESA. (body, standard) Video Electronics Standards Association - (VESA) An industry standards organisation created in 1989 or 1990 mostly(?) concerned with IBM compatible personal computers. (VESA (Video Electronics Standards Association, Milpitas, CA, www.vesa.org) A membership organization founded in 1989 that sets interface standards for the PC, workstation and computing environments. Note the following VESA standards following this entry. ), endorsed PanelLink(TM) technology, a licensed technology from Silicon Image Inc., as the proposed interface standard for flat panel displays A thin display screen for computer and TV usage. The first flat panels appeared on laptop computers in the mid-1980s, and the LCD technology became the standard. Stand-alone LCD screens became available for desktop computers in the mid-1990s and exceeded sales of CRTs for the first time in portable PCs and on the desktop. "Our new two-chip PanelLink solution began shipping this current quarter," Stafford added. "We plan to integrate PanelLink transmitter A device that generates signals. Contrast with receiver. technology into our HiQVideo family of products." For the first fiscal quarter of 1997, operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased to $11.4 million, an increase of 16% over the year-ago period. As a percent of sales, operating expenses were 26%, compared to 26% in the quarter ended a year ago and compared to 29% in the quarter ended June 30, 1996. This release contains certain forward looking statements like "expect or plan." Such statements are subject to risks and uncertainties including those listed in the Company's recent 10K filing. -0-
CHIPS AND TECHNOLOGIES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share amounts)
Three Months Ended
Sept. 30,
1996 1995
Net sales $44,486 $37,219
Cost of sales 23,203 22,858
Gross margin 21,283 14,361
Operating expenses
Research and development 4,534 4,905
Selling, general and administrative 6,871 4,904
Total operating expenses 11,405 9,809
Income from operations 9,878 4,552
Interest income and other, net 623 368
Income before taxes 10,501 4,920
Provision for income taxes 1,050 492
Net Income $9,451 $4,428
Net income per share $0.42 $0.20
Shares used in per share calculation 22,485 22,168
CHIPS AND TECHNOLOGIES, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
Sept. 30, June 30,
1996 1996
Assets
Current assets:
Cash and cash equivalents $25,817 $23,989
Short-term investments 37,105 35,356
Accounts receivable, net of
allowance for doubtful accounts
of $1,279 and $1,203,
respectively 15,338 12,189
Inventory 11,947 10,197
Prepaid and other assets 3,163 2,574
Total current assets 93,370 84,305
Property and equipment, net 11,665 11,223
Other assets 17,618 12,543
Total assets $122,653 $108,071
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $16,749 $12,820
Current capital lease obligations 1,661 1,630
Other accrued liabilities 10,206 9,436
Total current liabilities 28,616 23,886
Long-term capital lease obligations 426 796
Total liabilities 29,042 24,682
Stockholders' equity:
Common stock, 20,691,000 and 20,620,000
shares issued and outstanding 207 206
Capital in excess of par value 78,113 77,769
Note receivable from officer (50) (80)
Unrealized gain on investments 3,817 3,421
Retained earnings 11,524 2,073
Total stockholders' equity 93,611 83,389
Total liabilities and stockholders'
equity $122,653 $108,071
-0- Note to Editors: PanelLink is a trademark of Silicon Image, Inc. HiQVideo is a trademark of Chips and Technologies, Inc. All other trademarks and brand names are the property of their respective owners. CONTACT: Chips and Technologies, Inc., San Jose Tim Christoffersen, 408/434-0600 |
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