ON Semiconductor Posts Second Quarter Results with Continued Revenue Growth, Gross Margin Improvement and Positive Cash Flow.Business Editors & High-Tech high-tech also hi-tech adj. Informal Of, relating to, or resembling high technology. high-tech Adjective same as hi-tech Adj. 1. Writers PHOENIX--(BUSINESS WIRE)--July 22, 2002 ON Semiconductor Corp. (Nasdaq:ONNN) today announced that total revenues in the second quarter of 2002 were $278 million, a sequential increase of $9 million from the first quarter of 2002. The company had 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 net loss of $22 million, or $0.14 per share, as compared to a pro forma net loss of $0.26 per share in the first quarter of 2002. The second quarter pro forma results exclude 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). and other charges of $3 million and an extraordinary loss on debt prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. of $7 million. Including these items, the company reported a net loss of $32 million, or $0.19 per share, in the second quarter of 2002 as compared to a net loss of $50 million, or $0.30 per share, in the first quarter of 2002. Gross margin improved 580 basis points from the first quarter to 27.4 percent in the second quarter as the company realized further gains primarily from its cost restructuring and increased factory utilization. As of the end of the second quarter of 2002, the company completed actions to achieve an estimated $340 million of annual savings as compared to the first quarter of 2001. These savings, along with continued working capital improvement, led to positive cash flow a full quarter ahead of expectations. Cash and cash equivalents increased to $168 million in the second quarter of 2002, up $20 million from the prior quarter. On a sequential basis, the company's 13-week 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. grew for the second consecutive quarter with book-to-bill above parity parity or space parity, in physics, quantity that refers to the relationship between an object or process and the image that it can produce in a mirror. . BUSINESS REVIEW "Becoming cash-flow positive a full quarter ahead of estimates has energized the entire company to continue this momentum as we now turn our efforts to growing the business and focusing on market share growth," said Steve v. t. 1. To pack or stow, as cargo in a ship's hold. See Steeve. Hanson Hanson may refer to:
"The continuing market momentum coupled with our operational strengths in quality, customer service and the delivery of analog power and data management devices have enabled us to grow our revenues for the second consecutive quarter. During the quarter we were proud to earn recognition from Bosch Bosch , Hieronymus 1450?-1516. Dutch painter whose largely religious works are characterized by grotesque, fantastic creatures mingling with human figures. Noun 1. , Celestica Celestica Inc. (TSX: CLS.SV NYSE: CLS) is a multinational electronics manufacturing services (EMS) company headquartered in Toronto, Canada. Celestica operates a global manufacturing network with operations in Asia, Europe and the Americas, providing a broad range of , Jabil, Motorola (Motorola, Inc., Schaumburg, IL, www.motorola.com) A leading manufacturer of semiconductor devices, electronics, telecommunications and satellite systems. Founded in Chicago in 1928 by Paul V. , Sony SONY Standard Oil of New York (common, but untrue; it's an urban legend) and Solectron Solectron Corporation (NYSE: SLR), is a global electronics manufacturing company for original equipment manufacturer (OEMs). It pioneered the electronics manufacturing services (EMS) industry in 1977 and is a leader in the field. for providing them with industry-leading service," Hanson continued. "We are a broad-based broad-based Of or relating to an index or average that provides a good representation of the overall market. The S&P 500 and NYSE Composite are generally regarded as broad-based stock indexes, while the popular Dow Jones Industrial Average is biased supplier and saw growth in nearly all markets, notably the automotive, computing computing - computer , and wireless markets where our new products are finding their way into some exciting designs," said Hanson. "From our computer market initiative, we strengthened our position in the delivery of complete power-management solutions for advanced microprocessors This is a list of microprocessors. Intel
adj. Electricity Relating to two alternating currents with phases differing by 90°. controller. We also introduced the NUP n. 1. Same as Nupson. 4201, the industry's first 4-line protection device to meet USB USB in full Universal Serial Bus Type of serial bus that allows peripheral devices (disks, modems, printers, digitizers, data gloves, etc.) to be easily connected to a computer. 2.0 requirements for high-speed high-speed adj. 1. Operated or designed for operation at high speed: a high-speed food processor. 2. Taking place at high speed: a high-speed chase. 3. data lines used in computing platforms See platform. . "This device is based on our MicroIntegration technology. These accomplishments enabled us to win some key sockets on the motherboards at Samsung, DFI See Direct foreign investment. , NEC (NEC Corporation, Tokyo, www.nec.com, www.necus.com) An electronics conglomerate known in the U.S. for its monitors. In Japan, it had the lion's share of the PC market until the late 1990s (see PC 98). NEC was founded in Tokyo in 1899 as Nippon Electric Company, Ltd. and Greatwall." SECOND HALF OUTLOOK "We have several indicators that give us confidence that our momentum will continue into the second half of the year," Hanson said. "For the third quarter we anticipate total revenues to be flat to slightly up sequentially with gross margins increasing 100 to 300 basis points and 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. remaining flat to slightly down from the second quarter. This includes further realization of our cost savings activities that we will continue implementing during this timeframe." "Orders are growing and we continue to strengthen the income statement and balance sheet," Hanson continued. "We are excited with our backlog of new products that address the power and data management needs of our customers, and they are very pleased with our level of service and world-class delivery. I am confident that we have the key elements in place to maneuver maneuver /ma·neu·ver/ (mah-noo´ver) a skillful or dextrous method or procedure. Bracht's maneuver a method of extraction of the aftercoming head in breech presentation. through a hazy haz·y adj. haz·i·er, haz·i·est 1. Marked by the presence of haze; misty: hazy sunshine. 2. second half of the year." TELECONFERENCE ON Semiconductor will hold a conference call for the financial community at 5 p.m. Eastern Time (EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT ) today to discuss the second quarter results. The company will provide a real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. audio broadcast of the teleconference on the Investor Relations Investor relations The process by which the corporation communicates with its investors. page of its Web site at http://www.onsemi.com. The webcast will be available for one week following the conference call. About ON Semiconductor ON Semiconductor offers an extensive portfolio of power- and data-management semiconductors and standard semiconductor components that address the design needs of today's sophisticated electronic products, appliances and automobiles. For more information visit ON Semiconductor's Web site at http://www.onsemi.com. ON Semiconductor and the ON Semiconductor logo are registered trademarks of Semiconductor Components Industries LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control . All other brand and product names appearing in this document are registered trademarks or trademarks of their respective holders. Although the company references its Web site in this news release, such information on the Web site is not to be incorporated herein. This news release includes "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. " as that term is defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are statements that could be deemed forward-looking statements and are often characterized char·ac·ter·ize tr.v. character·ized, character·iz·ing, character·iz·es 1. To describe the qualities or peculiarities of: characterized the warden as ruthless. 2. by the use of words such as "believes," "expects," "estimates," "projects," "may," "will," "intends," "plans," or "anticipates," or by discussions of strategy, plans or intentions. In this news release, forward-looking information relates to third quarter 2002 total revenues, gross margin, operating expenses, cost reductions, and similar matters. All forward-looking statements in this news release are made based on management's current expectations and estimates, which involve risks, uncertainties and other factors that could cause results to differ materially from those expressed in forward-looking statements. Among these factors are changes in overall economic conditions, the cyclical cyclical Of or relating to a variable, such as housing starts, car sales, or the price of a certain stock, that is subject to regular or irregular up-and-down movements. nature of the semiconductor industry, changes in demand for our products, changes in inventories at our customers and distributors, technological and product development risks, availability of raw materials, competitors' actions, loss of key customers, order cancellations or reduced bookings, changes in manufacturing yields, control of costs and expenses, significant litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , risks associated with acquisitions and dispositions, risks associated with our substantial leverage and restrictive covenants Restrictive covenants Provisions that place constraints on the operations of borrowers, such as restrictions on working capital, fixed assets, future borrowing, and payment of dividends. in our debt agreements, possible future delisting Delisting When the stock of a company is removed from a stock exchange. Notes: Reasons for delisting include violating regulations and/or failure to meet financial specifications set out by the stock exchange. of our common stock by Nasdaq, risks associated with our 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 risks involving environmental or other governmental regulation. Additional factors that could affect the company's future operating results are described in our 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 year ended Dec. 31, 2001 under the caption "Trends, Risk and Uncertainties" in the MD&A section, and other factors are described from time to time in our SEC filings. Readers are cautioned not to place undue reliance on forward-looking statements. We assume no obligation to update such information.
ON SEMICONDUCTOR
Unaudited Consolidated Statements of Operations
(in millions, except per share amounts)
Quarter Ended
-------------------------------
June 28, March 29, June 29,
2002 2002 2001
-------- ---------- ---------
Revenues:
Net product revenues $ 277.5 $ 268.7 $ 307.3
Foundry revenues from Motorola 0.2 0.4 3.4
Total revenues 277.7 269.1 310.7
Cost of sales 201.7 210.9 255.6
Gross profit 76.0 58.2 55.1
Operating expenses:
Research and development 16.2 17.3 22.9
Selling and marketing 15.2 14.6 20.8
General and administrative 26.7 29.2 34.0
Amortization of goodwill and
other intangibles 3.0 3.0 5.6
Restructuring and other charges 3.1 7.1 95.8
Total operating expenses 64.2 71.2 179.1
Operating income (loss) 11.8 (13.0) (124.0)
Other income (expenses), net:
Interest expense (36.3) (34.7) (29.7)
Equity in earnings of joint
ventures 2.5 1.2 1.5
Gain on sale of investment in
joint venture - - -
Other income (expenses), net (33.8) (33.5) (28.2)
Loss before income taxes, minority
interests, extraordinary loss and
cumulative effect of accounting
change (22.0) (46.5) (152.2)
(Provision) benefit for income taxes (3.3) (3.7) -
Minority interests - 0.2 -
Net loss before extraordinary loss
and cumulative effect of accounting
change (25.3) (50.0) (152.2)
Extraordinary loss on debt prepayment
(net of tax) (6.5) - -
Cumulative effect of accounting change
(net of tax) - - -
Net loss (31.8) (50.0) (152.2)
Less: Redeemable preferred stock
dividends (2.1) (2.1) -
Net loss applicable to common stock $ (33.9) $ (52.1) $ (152.2)
Earnings (loss) per common share(a):
Basic:
Net loss before extraordinary
loss and cumulative effect of
accounting change applicable to
common stock $ (0.16) $ (0.30) $ (0.88)
Extraordinary loss on debt
prepayment (0.04) - -
Cumulative effect of accounting
change - - -
Net loss $ (0.19) $ (0.30) $ (0.88)
Diluted:
Net loss before extraordinary
loss and cumulative effect of
accounting change applicable to
common stock $ (0.16) $ (0.30) $ (0.88)
Extraordinary loss on debt
prepayment (0.04) - -
Cumulative effect of accounting
change - - -
Net loss $ (0.19) $ (0.30) $ (0.88)
Weighted average common shares
outstanding:
Basic 175.5 174.8 173.5
Diluted 175.5 174.8 173.5
Six Months Ended
--------------------
June 28, June 29
2002 2001
-------- ----------
Revenues:
Net product revenues $ 546.2 $ 664.3
Foundry revenues from Motorola 0.6 6.9
Total revenues 546.8 671.2
Cost of sales 412.6 529.5
Gross profit 134.2 141.7
Operating expenses:
Research and development 33.5 45.8
Selling and marketing 29.8 44.6
General and administrative 55.9 70.8
Amortization of goodwill and
other intangibles 6.0 11.4
Restructuring and other charges 10.2 133.8
Total operating expenses 135.4 306.4
Operating income (loss) (1.2) (164.7)
Other income (expenses), net:
Interest expense (71.0) (58.9)
Equity in earnings of joint
ventures 3.7 2.1
Gain on sale of investment in
joint venture - 3.1
Other income (expenses), net (67.3) (53.7)
Loss before income taxes, minority
interests, extraordinary loss and
cumulative effect of accounting
change (68.5) (218.4)
(Provision) benefit for income taxes (7.0) 22.7
Minority interests 0.2 0.5
Net loss before extraordinary loss
and cumulative effect of accounting
change (75.3) (195.2)
Extraordinary loss on debt prepayment
(net of tax) (6.5) -
Cumulative effect of accounting change
(net of tax) - (116.4)
Net loss (81.8) (311.6)
Less: Redeemable preferred stock
dividends (4.2) -
Net loss applicable to common stock $ (86.0) $ (311.6)
Earnings (loss) per common share(a):
Basic:
Net loss before extraordinary
loss and cumulative effect of
accounting change applicable to
common stock $ (0.45) $ (1.13)
Extraordinary loss on debt
prepayment (0.04) -
Cumulative effect of accounting
change - (0.67)
Net loss $ (0.49) $ (1.80)
Diluted:
Net loss before extraordinary
loss and cumulative effect of
accounting change applicable to
common stock $ (0.45) $ (1.13)
Extraordinary loss on debt
prepayment (0.04) -
Cumulative effect of accounting
change - (0.67)
Net loss $ (0.49) $ (1.80)
Weighted average common shares
outstanding:
Basic 175.2 172.8
Diluted 175.2 172.8
(a) Certain amounts do not total due to rounding of per share
components.
ON SEMICONDUCTOR
Consolidated Balance Sheets
(in millions)
June 28, March 28, Dec. 31,
2002 2002 2001
----------- ----------- ----------
(unaudited) (unaudited)
Assets
Cash and cash equivalents $ 167.7 $ 147.6 $ 179.8
Restricted cash 1.6 - -
Receivables, net 143.5 152.7 142.3
Inventories, net 160.0 170.2 183.7
Other current assets 32.5 35.8 35.8
Deferred income taxes 7.7 10.3 9.2
Total current assets 513.0 516.6 550.8
Property, plant and equipment,
net 503.0 528.6 555.5
Deferred income taxes - - 1.3
Investments in and advances
to joint ventures 99.1 96.6 95.4
Goodwill 77.3 77.3 77.3
Intangible assets, net 32.7 35.7 38.6
Other assets 41.6 39.8 41.5
Total assets $ 1,266.7 $ 1,294.6 $ 1,360.4
Liabilities, Minority Interests,
Redeemable Preferred Stock and
Stockholders' Deficit
Accounts payable $ 94.1 $ 111.9 $ 111.5
Accrued expenses 93.4 94.0 90.2
Income taxes payable 5.3 9.8 8.0
Accrued interest 29.3 5.1 13.4
Deferred income on sales to
distributors 75.3 78.1 99.4
Current portion of long-term debt 7.5 12.6 12.4
Total current liabilities 304.9 311.5 334.9
Long-term debt 1,392.6 1,372.8 1,374.5
Other long-term liabilities 55.0 68.0 62.7
Deferred income taxes 1.0 0.3 -
Total liabilities 1,753.5 1,752.6 1,772.1
Minority interests in
consolidated subsidiaries 3.9 3.9 4.1
Redeemable preferred stock 105.8 103.7 101.6
Common stock 1.8 1.8 1.7
Additional paid-in capital 737.7 738.1 738.8
Accumulated other comprehensive
income (29.1) (30.4) (32.8)
Accumulated deficit (1,306.9) (1,275.1) (1,225.1)
Total stockholders' deficit (596.5) (565.6) (517.4)
Total liabilities, minority
interests, redeemable preferred
stock and stockholders' deficit $ 1,266.7 $ 1,294.6 $ 1,360.4
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