STMicroelectronics Reports Sequential and Year-over-Year Increases in Third Quarter Revenues and Earnings.Business Editors GENEVA--(BUSINESS WIRE)--Oct. 22, 2002 STMicroelectronics This article needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. (NYSE NYSE See: New York Stock Exchange : STM (Scanning Tunneling Microscope) A microscope that can image down to the atomic level. An STM uses a piezoelectric tube with a tiny sharp tip at the end that is moved within nanometers of the object being sampled. ): - Underlining the strength of the alliance announced earlier this year between ST, Motorola and Philips to jointly develop breakthrough semiconductor technology at the new Crolles2 R&D center at ST's site in Crolles, France, the three companies announced the industry's first 90nm (0.09-micron) CMOS design platform. This early, key achievement will allow design engineers to immediately start developing next generation system-on-chip (SoC) products for low-power, wireless, networking, consumer, and high-speed applications. - Maintaining its aggressive progress in the Flash memory market, ST introduced its first products built using next-generation 0.13-micron technology. The new devices target the emerging 3G mobile phone market. ST will ramp up volume production at its Agrate fab during the current quarter. - ST introduced a new family of Flash memories, called LightFlash, optimized for digital consumer and office peripheral applications. Built using 0.15-micron process technology, these devices are compatible with standard Flash memories, but allow easier code updates during the engineering phase of a product ramp-up and faster code updates during production. - In the smart-card market, ST started volume deliveries of the first secure microcontroller in the world to receive Universal Serial Bus (USB) certification for use in smart cards and tokens. The ST19XT34 is targeted at PC-based applications such as secure log-in, secure email, digital signatures and secure intranet access. - ST unveiled the industry's first hard disk drive (HDD) read/write channel chip that fully supports vertical recording for HDDs. The new chip is designed in ST's advanced 130nm CMOS technology and fully exploits the process's low-power options to extend battery life in laptop and similar mobile applications. - ST also gained two major 130nm SoC design wins in the HDD marketplace, one in the high-volume desktop segment and one in the high-performance enterprise segment. The first reinforces ST's SoC leadership in the desktop HDD segment, while the second represents a key milestone for ST's penetration into the high-margin market segment. - In the printer arena, ST increased its cooperation with Lexmark with the development of an SoC device for next-generation printers and gained a new SoC design win with another leading printer manufacturer. - In the image sensor field, ST introduced a 1.3-million-pixel CMOS sensor aimed at the high-quality, low-cost digital camera and camcorder markets. The new sensor rivals the resolution of charge-coupled devices (CCDs), but with substantial benefits in cost, size, weight, power management, and integration. - ST began sampling a new AM/FM radio receiver chipset that directly digitizes the 10.7-MHz intermediate frequency, allowing enhanced performance and convergence with IBOC (In-Band On-Channel) digital radio in the future. - In automotive, ST gained numerous design wins including chips for a power-steering application for a US customer, a powertrain chipset for a Japanese customer, and further designs in powertrain applications for European- and US-based customers for the Company's ST10 microcontroller. - ST signed a contract with Alcatel for the supply of three ASICs for the trial phase of a Fiber-to-The-User (FTTU) application aimed at bringing high-speed data to the user's desktop. Alcatel also placed a substantial order for quad-line xDSL chipsets. - During the quarter, ST successfully integrated the wireless and wireline activities of Alcatel Microelectronics, further strengthening ST's telecommunications portfolio. - ST started shipping mobile-phone energy-management devices in volume to three recently gained customers. These products are now being delivered in volume to four of the world's top five manufacturers. ST also began volume deliveries of LCD driver chips for mobile phones. - Underlining its increasing role in the mobile market and reinforcing its commitment to the Open Mobile Alliance (OMA), ST joined the OMA Board of Directors and upgraded its status to Sponsor Member. STMicroelectronics (NYSE: STM) today reported financial results for the third quarter and first nine months ended September September: see month. 28, 2002. Third Quarter 2002 Financial Results Net revenues for the third quarter were $1,645.2 million, a 7.5% sequential One after the other in some consecutive order such as by name or number. increase over the $1,531.1 million reported in the 2002 second quarter, and 17.5% above the $1,400.7 million of last year's third quarter. Revenues from differentiated dif·fer·en·ti·ate v. dif·fer·en·ti·at·ed, dif·fer·en·ti·at·ing, dif·fer·en·ti·ates v.tr. 1. To constitute the distinction between: products increased 8% sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen to $1,143.0 million, and accounted for 69.5% of net revenues for the period. Analog ICs (including mixed signal ICs) represented 54.2% of net revenues in the 2002 third quarter, compared to 52.1% in the prior period. Gross profit was $609.1 million, a 5.8% sequential increase from the prior quarter's $575.8 million, and 31.8% above last year's third quarter gross profit of $462.1 million. Gross margin was 37.0% compared to 37.6% in the 2002 second-quarter and 33.0% in the similar year-ago period. Pasquale Pasquale may refer to:
v. de·rived, de·riv·ing, de·rives v.tr. 1. To obtain or receive from a source. 2. from a combination of organic growth and the benefits of the Alcatel Alcatel Société Alsacienne de Constructions Atomiques, de Télécomunications et d'Electronique Microelectronics microelectronics, branch of electronic technology devoted to the design and development of extremely small electronic devices that consume very little electric power. acquisition, which was completed at the end of the 2002 second quarter. Organic growth represented a sequential revenue increase of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 4.5%, with the acquisition accounting for the additional 3%. Our unique balance of targeted market segments enabled ST to benefit from higher demand in certain key applications and maintain stable gross margin levels, despite the difficult industry conditions which persisted during the period." Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. was $184.8 million, up 25.9% sequentially and over 3.8 times higher than that of last year's third quarter. Operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: reached 11.2%, compared to 9.6% in the prior quarter and 3.4% in the 2001 third quarter. Net income equaled $131.2 million for the 2002 third quarter, a sequential increase of 25.3% over the $104.7 million earned in the 2002 second quarter and significantly above the net income of $35.8 million reported in last year's third quarter. Earnings 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 were $0.15 for the 2002 third quarter, compared to $0.12 in the second quarter of this year and $0.04 in the 2001 third quarter. Commenting on third quarter performance, Mr. Pistorio said, "ST continued to enjoy a high degree of operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. , posting 25%+ increases in both operating income and net income, on a 7.5% sequential revenue gain. R&D expenditures and SG&A costs in the aggregate were virtually flat on a sequential basis, reflecting the combination of ongoing investment in strategic programs, with a consistent emphasis on cost efficiency throughout the Company. Operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. was $160.1 million in the third quarter, including the final payment for the Alcatel Microelectronics acquisition, which amounted to $81.2 million. In the 2002 third quarter, research and development expenses were $258.0 million, similar to the $258.3 million incurred in the second quarter of 2002 and 12.6% above the $229.2 million in the comparable year-ago period. R&D costs represented 15.7% of net revenues in the 2002 third quarter compared to 16.9% of net revenues in the 2002 second quarter, and 16.4% of net revenues in the third quarter of 2001. Selling, general and administrative expenses were $162.7 million for the 2002 third quarter, close to the prior quarter's $159.9 million, and above the $144.2 million of the similar year-ago period. As a percentage of net revenues, however, SG&A expenses declined to 9.9%, from 10.4% in the second quarter of 2002 and 10.3% of the 2001 third quarter. Additional Third Quarter 2002 Financial/Operating Data The following tables and commentary provide a breakdown breakdown /break·down/ (brak´doun) 1. the act or process of ceasing to function. 2. an often sudden collapse in health. 3. loss of self-control. of revenues and operating income by product group.
Third Quarter 2002 Net Revenues and Operating Income By Product Group:
----------------------------------------------------------------------
Operating
Group Revenue % of Net Income
(Million US$) Revenue Q3 2002
(Million US$)
----------------------------------------------------------------------
Telecommunications, $816.3 49.6% $154.7
Peripherals and Automotive
(TPA)
----------------------------------------------------------------------
Discrete and Standard ICs 282.7 17.2% 39.9
(DSG)
----------------------------------------------------------------------
Memory Products (MPG) 252.5 15.3% (8.0)
----------------------------------------------------------------------
Consumer and 267.4 16.3% 18.5
Microcontroller (CMG)
----------------------------------------------------------------------
OTHER(a) 26.3 1.6% (20.3)
----------------------------------------------------------------------
TOTAL $1,645.2 100.0% $184.8
----------------------------------------------------------------------
(a) The 'OTHER' category includes such items as start-up costs, and
other unallocated expenses including: strategic (or special)
research and development programs, certain corporate level
operating expenses, restructuring charges, and other costs that
are not allocated to product groups, as well as the revenues and
operating earnings or losses of the New Ventures Group and the
Subsystems Products Group.
All product groups experienced sequential revenue growth in the
2002 third quarter. TPA was the largest gainer, posting an 11.7%
sequential increase fueled by strong sales gains to telecom and
automotive end markets and, the Group reported a 6.3% sequential
increase in operating income. CMG recorded a 1.6% sequential
revenue gain, as significant increases in sales for DVD
applications and imaging products were offset, to a large extent,
by a quarterly fall-off in demand from the set-top-box market.
CMG's operating income, up 55.5% sequentially, returned to more
normalized levels following an inventory write-off, primarily
related to graphics products which occurred in the prior quarter.
DSG's revenues were up 6.0% sequentially, with operating income
remaining stable relative to the prior quarter. MPG's sales showed
a 2.6% sequential improvement, but operating results were
penalized by manufacturing variances related to production
ramp-up, which were specific to the third quarter.
Q3 2002 Revenue Breakdown By Market Segment
----------------------------------------------------------------------
Revenue % of Net Revenue
(Million US$)
----------------------------------------------------------------------
Automotive $222.4 13.5%
----------------------------------------------------------------------
Consumer 337.0 20.5%
----------------------------------------------------------------------
Computer 353.4 21.5%
----------------------------------------------------------------------
Telecom 499.7 30.4%
----------------------------------------------------------------------
Industrial & Other 232.7 14.1%
----------------------------------------------------------------------
All market segments achieved sequential revenue growth in the 2002
third quarter. Telecom increased 12.4%; Automotive was up 11.3%;
and Industrial and Other was up 10.7%, all growing at rates in
excess of that of the Company as a whole. Computer and Consumer
posted sequential revenue increases of 3.2% and 0.9%,
respectively.
Q3 2002 Geographic Revenue Breakdown
By Customers' Region of Origin By Location of Order Shipment
----------------------------------------------------------------------
Revenue % of Net Revenue % of Net
(Million US$) Revenue (Million US$) Revenue
----------------------------------------------------------------------
Europe $711.7 43.3% Europe $469.2 28.5%
----------------------------------------------------------------------
North North
America 532.3 32.4% America 242.2 14.7%
----------------------------------------------------------------------
Asia/Pac 211.1 12.8% Asia/Pac 701.5 42.7%
----------------------------------------------------------------------
Japan 143.7 8.7% Japan 84.6 5.1%
----------------------------------------------------------------------
Emerging Emerging
Markets 46.4 2.8% Markets 147.7 9.0%
----------------------------------------------------------------------
The geographic revenue breakdown in the 2002 third quarter was
consistent with that of the prior quarter, showing some sequential
sales gains to customers in Japan and Emerging Markets, and
continuing to reflect the migration of industry-wide manufacturing
to the Asia/Pac region.
Q3 2002 Revenue Breakdown by Product Category
----------------------------------------------------------------------
Revenue % of Net Revenue
(Million US$)
----------------------------------------------------------------------
Differentiated Products $1,143.0 69.5%
----------------------------------------------------------------------
Standard & Commodities 95.1 5.8%
----------------------------------------------------------------------
Micro & Memories 204.2 12.4%
----------------------------------------------------------------------
Discretes 202.9 12.3%
----------------------------------------------------------------------
All product categories posted sequential revenue increases, led by
Differentiated Products which increased 8.0% over second quarter
2002 levels. Discretes were up 7.5%; Micro & Memories were up
7.3%; and Standard & Commodities increased 1.8%.
Nine Month 2002 Results Net revenues for the nine months ended September 28, 2002 were $4,531.5 million, compared to the $4,909.0 million reported in the 2001 nine month period. Gross profit was $1,636.9 million, or 36.1% of net revenues. Operating income was $391.9 million, or 8.6% of net revenues. Net income was $268.8 million, or $0.30 per diluted share. Research and development costs were $739.9 million, or 16.3% of net revenues compared to $757.0 million in the 2001 nine-months, or 15.4% of net revenues. Selling, general and administrative expenses were $464.1 million, or 10.2% of net revenues compared to $501.1 million, or 10.2% of net revenues in the 2001 period. Reviewing results to date, Mr. Pistorio noted, "As projected, the 2002 first quarter marked the bottom of the cycle for ST, resulting in successive periods of stronger revenue and earnings levels for the Company. Continued penetration The successful unauthorized breach of a security perimeter. See penetration test. of key applications within the markets we serve has enabled ST to maintain its leadership position in those product categories and end markets in which convergence convergence Mathematical property of infinite series, integrals on unbounded regions, and certain sequences of numbers. An infinite series is convergent if the sum of its terms is finite. , which we believe will increasingly drive the industry's growth, is having the greatest impact." Balance Sheet Highlights at September 28, 2002 At the end of the third quarter, the Company had cash, cash equivalents and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has of $2.27 billion. 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. totaled $2.80 billion and shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. was $6.57 billion, representing a net debt to shareholders' equity ratio of 0.10. Capital expenditures were $298.5 million for the 2002 third quarter and $770.7 million for the first nine months of 2002. This compares with capital expenditures of $336.0 million and $1,563.1 million in last year's third quarter and nine months, respectively. Operating cash flow for the first nine months of 2002 was $40.2 million, after the acquisition of Alcatel Microelectronics which amounted to $308.8 million. Mr. Pistorio noted, "We believe that ST's strong balance sheet, which is 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 substantial liquidity, combined with the Company's proven ability to generate positive operating cash flow, provide a level of financial flexibility that is noteworthy within our industry." Outlook Mr. Pistorio commented, "As noted in our second quarter 2002 earnings release, ST's capital expenditures for this year should approximate ap·prox·i·mate v. To bring together, as cut edges of tissue. adj. 1. Relating to the contact surfaces, either proximal or distal, of two adjacent teeth; proximate. 2. Close together. $1 billion, providing the resources to advance strategic investments and R&D and new product development projects. The pace of the economic and industry recovery is still uncertain, which leads us to adopt a cautious approach to 2003. At this point, we expect ST's 2003 capital expenditures to be of a similar magnitude magnitude, in astronomy, measure of the brightness of a star or other celestial object. The stars cataloged by Ptolemy (2d cent. A.D.), all visible with the unaided eye, were ranked on a brightness scale such that the brightest stars were of 1st magnitude and the to 2002 levels. Complementing this plan, however, are the Company's proven modular investment programs as well as our relationships with 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. partners, both of which provide ST with significant operating flexibility." "We share the view that the traditional fourth quarter seasonal upturn in demand will be quite modest this year," Mr. Pistorio said. "We do expect, however, that ST will be able to post sequential revenue growth in the mid single-digit range for the 2002 fourth quarter, driven by increasing end market demand for telecom and automotive applications as well as a pick-up pick-up Noun 1. a small truck with an open body used for light deliveries 2. Informal a casual acquaintance made for a sexual purpose 3. Informal a. in revenues from Flash memory products. Gross margin is likely to remain stable, within the 37%-38% range." "ST's consistency Consistency can refer to:
An ingredient is something that forms part of a mixture (in a general sense). in our ability to record above-average operating and financial performance and significantly increase our industry rankings. At the same time, we have remained responsive and adaptable a·dapt·a·ble adj. Capable of adapting or of being adapted. a·dapt  a·bil to changing market dynamics and
have fine-tuned our strategies in order to maximize In a graphical environment, to enlarge a window to the full size of the screen. See Win Maximize windows. our returns within
diverse macroeconomic mac·ro·ec·o·nom·ics n. (used with a sing. verb) The study of the overall aspects and workings of a national economy, such as income, output, and the interrelationship among diverse economic sectors. environments," Mr. Pistorio concluded. Products, Technology and Design Wins - Underlining the strength of the alliance announced earlier this year between ST, Motorola and Philips to jointly develop breakthrough semiconductor technology at the new Crolles2 R&D center at ST's site in Crolles, France, the three companies announced the industry's first 90nm (0.09-micron) CMOS design platform. This early, key achievement will allow design engineers to immediately start developing next generation system-on-chip (SoC) products for low-power, wireless, networking, consumer, and high-speed applications. - Maintaining its aggressive progress in the Flash memory market, ST introduced its first products built using next-generation 0.13-micron technology. The new devices target the emerging 3G mobile phone market. ST will ramp up volume production at its Agrate fab during the current quarter. - ST introduced a new family of Flash memories, called LightFlash, optimized for digital consumer and office peripheral applications. Built using 0.15-micron process technology, these devices are compatible with standard Flash memories, but allow easier code updates during the engineering phase of a product ramp-up and faster code updates during production. - In the smart-card market, ST started volume deliveries of the first secure microcontroller in the world to receive Universal Serial Bus (USB) certification for use in smart cards and tokens. The ST19XT34 is targeted at PC-based applications such as secure log-in, secure email, digital signatures and secure intranet access. - ST unveiled the industry's first hard disk drive (HDD) read/write channel chip that fully supports vertical recording for HDDs. The new chip is designed in ST's advanced 130nm CMOS technology and fully exploits the process's low-power options to extend battery life in laptop and similar mobile applications. - ST also gained two major 130nm SoC design wins in the HDD marketplace, one in the high-volume desktop segment and one in the high-performance enterprise segment. The first reinforces ST's SoC leadership in the desktop HDD segment, while the second represents a key milestone for ST's penetration into the high-margin market segment. - In the printer arena, ST increased its cooperation with Lexmark with the development of an SoC device for next-generation printers and gained a new SoC design win with another leading printer manufacturer. - In the image sensor field, ST introduced a 1.3-million-pixel CMOS sensor aimed at the high-quality, low-cost digital camera and camcorder markets. The new sensor rivals the resolution of charge-coupled devices (CCDs), but with substantial benefits in cost, size, weight, power management, and integration. - ST began sampling a new AM/FM radio receiver chipset that directly digitizes the 10.7-MHz intermediate frequency, allowing enhanced performance and convergence with IBOC (In-Band On-Channel) digital radio in the future. - In automotive, ST gained numerous design wins including chips for a power-steering application for a US customer, a powertrain chipset for a Japanese customer, and further designs in powertrain applications for European- and US-based customers for the Company's ST10 microcontroller. - ST signed a contract with Alcatel for the supply of three ASICs for the trial phase of a Fiber-to-The-User (FTTU) application aimed at bringing high-speed data to the user's desktop. Alcatel also placed a substantial order for quad-line xDSL chipsets. - During the quarter, ST successfully integrated the wireless and wireline activities of Alcatel Microelectronics, further strengthening ST's telecommunications portfolio. - ST started shipping mobile-phone energy-management devices in volume to three recently gained customers. These products are now being delivered in volume to four of the world's top five manufacturers. ST also began volume deliveries of LCD driver chips for mobile phones. - Underlining its increasing role in the mobile market and reinforcing its commitment to the Open Mobile Alliance (OMA), ST joined the OMA Board of Directors and upgraded its status to Sponsor Member. Some of the above statements that are not historical facts, including without limitation certain statements made in the paragraph entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: "outlook" concerning the company's revenues, capital expenditures and results of operations, are statements of current expectations that involve risks and uncertainties and other 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 U.S. Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. ) that are based on management's current views and assumptions. Actual results or performances could differ materially from those in such statements and from the expectations of the Company and its management, in particular, as a result of the following other important factors:
(i) demand for the Company's products and the competitive
pricing environment;
(ii) business and economic conditions in the end-user markets,
in particular demand for products made by our customers;
(iii) excess manufacturing capacity in the semiconductor
industry;
(iv) the growth of the economies in the major world markets and
the current uncertainty of political conditions in various
regions of the world;
(v) possible disruption in commercial activities occasioned by
major events in the world such as armed conflict or
terrorism;
(vi) the impact of foreign currency fluctuations, in particular
changes in the parity between the Euro and the US Dollar;
(vii) the success of alliances and agreements with other
companies to develop new technologies;
(viii) the availability of raw material and critical components
for our manufacturing operations;
(ix) competitive factors such as the timely development of new
products and designs in line with market and customer
requirements;
(x) excess or obsolete inventory and variations in inventory
valuation.
Unfavorable changes in any of the above or other factors listed under "Risk Factors" from time to time in the Company's SEC reports including the Annual Report on Form 20-F for the year ended December December: see month. 31, 2001, which was filed with the SEC on May 24, 2002, and in particular, the factors listed on page 2 of such Form 20-F, could materially affect the Company. Conference Call Information The management of STMicroelectronics will conduct a conference call on October October: see month. 23, 2002 at 9:00 a.m. U.S. Eastern Time / 3:00 p.m. CET CET abbr. Central European Time CET Central European Time CET n abbr (= Central European Time) → hora de Europa central CET abbr , to discuss operating performance for the third quarter of 2002. The conference call will be available via the 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 by accessing the following Web address: www.vcall.com. Those accessing the webcast should go to the Web site at least 15 minutes prior to the call, in order to register, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. The webcast will be available until October 31, 2002. About STMicroelectronics STMicroelectronics, the world's third largest semiconductor company, is a global leader in developing and delivering semiconductor solutions across the spectrum of microelectronics applications. An unrivaled combination of silicon and system expertise, manufacturing strength, Intellectual Property (IP) portfolio and strategic partners positions the Company at the forefront of System-on-Chip See SoC. (SoC) technology and its products play a key role in enabling today's convergence trends. The Company's shares are traded on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. , on Euronext Paris Euronext Paris is France's securities market, formerly known as the Paris Bourse, which merged with the Amsterdam and Brussels exchanges in September 2000 to form Euronext NV, which is the second largest exchange in Europe behind the London Stock Exchange. and on the Milan Stock Exchange Milan Stock Exchange The largest regional stock exchange in Italy, facilitating more than 90% of the country's trading volume. . In 2001, the Company's net revenues were $6.36 billion and net earnings were $257.1 million. Further information can be found at www.st.com.
STMicroelectronics N.V.
CONSOLIDATED BALANCE SHEET
As at Sept. 28, December 31,
In millions of U.S. dollars 2002 2001
--------------------------------
(Unaudited) (Audited)
----------------------------------------------------------------------
ASSETS
Current assets:
Cash and cash equivalents 1,066.6 2,438.8
Marketable securities 1,202.2 5.4
Trade accounts and notes receivable 1,016.3 902.4
Inventories 887.3 742.5
Other receivables and assets 543.8 468.5
----------------------------
Total current assets 4,716.2 4,557.6
Goodwill, net 170.8 63.0
Other intangible assets, net 313.0 149.6
Property, plant and equipment, net 5,971.8 5,888.2
Investments and other non-current assets 110.1 139.1
----------------------------
6,565.7 6,239.9
Total assets 11,281.9 10,797.5
----------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Bank overdrafts 15.3 32.8
Current portion of long-term debt 125.4 96.5
Trade accounts and notes payable 823.1 936.1
Other payables and accrued liabilities 481.7 409.5
Accrued and deferred income tax 172.9 212.4
----------------------------
Total current liabilities 1,618.4 1,687.3
Long-term debt 2,797.3 2,771.5
Reserves for pension and
termination indemnities 134.4 115.8
Other non-current liabilities 121.4 112.2
----------------------------
3,053.1 2,999.5
Total liabilities 4,671.5 4,686.8
Commitment and contingencies
Minority interests 41.0 36.0
Common Stock 1,143.1 1,142.4
Capital surplus 1,847.2 1,836.0
Accumulated result 4,431.7 4,198.6
Accumulated other comprehensive loss -504.3 -869.0
Treasury stock -348.3 -233.3
----------------------------
Shareholders' equity 6,569.4 6,074.7
----------------------------
Total liabilities and
shareholders' equity 11,281.9 10,797.5
----------------------------
STMicroelectronics N.V.
Selected Consolidated Financial Data
(In millions of U.S. dollars)
Consolidated Balance Sheet Data Sept. 28, Dec. 31,
(End of period) 2002 2001
---- ----
Cash, cash equivalents and
marketable securities 2,268.8 2,444.2
Working capital 969.7 555.4
Total assets 11,281.9 10,797.5
Short-term debt (including current
portion of long-term debt) 140.7 129.3
Long-term debt (excluding
current portion) 2,797.3 2,771.5
Shareholders' equity 6,569.4 6,074.7
Consolidated Operating Data Sept. 28, Sept. 29,
(Nine months ended) 2002 2001
---- ----
Payment for purchases of
tangible assets 770.7 1,563.1
Net cash from operating activities 1,154.0 1,516.9
Net operating cash flow 40.2 (155.5)
Operating cash flow (excluding 349.0
Alcatel Microelectronics purchase)
Depreciation and amortization 1,013.6 972.1
STMicroelectronics N.V.
Consolidated Statement of Income
(in millions of U.S. dollars, except per share data ($))
Three Months Ended Nine Months Ended
-------------------- -----------------------------
As As As As Pro
Reported Reported Reported Reported Forma
-------------------- -----------------------------
Sept. 28 Sept. 29 Sept. 28 Sept. 29 Sept. 29
2002 2001 2002 2001 2001
---- ---- ---- ---- ----
Net sales 1,632.9 1,384.5 4,499.0 4,865.5 4,865.5
Other revenues 12.3 16.2 32.5 43.5 43.5
-------------------- -------------------------------
NET REVENUES 1,645.2 1,400.7 4,531.5 4,909.0 4,909.0
Cost of sales (1,036.1) (938.6) (2,894.6) (3,058.6) (2,987.9)
-------------------- -------------------------------
GROSS PROFIT 609.1 462.1 1,636.9 1,850.4 1,921.1
Selling, general
& administrative (162.7) (144.2) (464.1) (501.1) (501.1)
Research &
development (258.0) (229.2) (739.9) (757.0) (757.0)
Other income
and expenses 8.0 (17.2) (11.4) 10.9 10.9
Impairment,
restructuring
and other related
closure costs (11.6) (23.3) (29.6) (334.6) 0.0
-------------------- -------------------------------
Total Operating
Expenses (424.3) (413.9) (1,245.0) (1,581.8) (1,247.2)
-------------------- -------------------------------
OPERATING INCOME 184.8 48.2 391.9 268.6 673.9
Net interest
expense (20.3) (4.8) (51.5) (1.3) (1.3)
Equity in loss of
joint ventures (3.8) (1.2) (11.0) (1.2) (1.2)
-------------------- -------------------------------
INCOME BEFORE
INCOME TAXES
AND MINORITY
INTERESTS 160.7 42.2 329.4 266.1 671.4
Income tax expense (29.0) (6.2) (57.9) (51.8) (123.6)
-------------------- -------------------------------
INCOME BEFORE
MINORITY
INTERESTS 131.7 36.0 271.5 214.3 547.8
Minority
interests (0.5) (0.2) (2.7) (2.2) (2.2)
-------------------- -------------------------------
NET INCOME 131.2 35.8 268.8 212.1 545.6
==================== ===============================
EARNINGS PER SHARE
(BASIC) 0.15 0.04 0.30 0.24 0.61
EARNINGS PER SHARE
(DILUTED) 0.15 0.04 0.30 0.23 0.60
NUMBER OF WEIGHTED
AVERAGE
SHARES USED IN
CALCULATING
DILUTED EARNINGS
PER SHARE 890.3 905.1 893.9 903.3 930.7
The pro forma amounts have been adjusted to eliminate the
following:
Nine Months
Ended
-----------
Sept. 29,
2001
Excess inventory charge 70.7
Impairment and restructuring charges 334.6
Income tax effect (71.8)
------------
TOTAL 333.5
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