Semtech Announces First Quarter Results.Business Editors CAMARILLO Camarillo (kă'mərē`yō), city (1990 pop. 52,303), Ventura co., S Calif.; inc. 1964. It is the center of a fertile farm area where citrus fruits and flowers are grown. , Calif.--(BUSINESS WIRE)--May 27, 2003 Semtech
Semtech Corporation (NASDAQ: SMTC) is a supplier of analog and mixed-signal semiconductors. Corporation (Nasdaq:SMTC SMTC Southern Maine Technical College SMTC Science/Mathematics/Technology Center (Central Michigan University) SMTC Saluda Mountain Telephone Company (Knoxville, Tennessee) SMTC Short-To-Medium Term Control ) today announced results for its fiscal year 2004 first quarter that ended April 27, 2003. Sales for the first quarter of fiscal year 2004 were $44.0 million and net income was $8.3 million or 11 cents 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. Sales for the first quarter of fiscal year 2003 were $49.2 million and net income was $10.0 million or 13 cents per diluted share. Gross margin was 56.5 percent in the first quarter of fiscal year 2004, compared to 56.2 percent in the prior quarter and 57.1 percent in the prior year first quarter. Sales for the fourth quarter of fiscal year 2003 were $44.5 million and net income was $62,000. Semtech continued to strengthen its balance sheet. 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. was reduced by $59.5 million during the first quarter of fiscal year 2004. Cash 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 , net of outstanding debt, increased to $248.3 million. Annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. inventory efficiencies improved to 5.2 turns of inventory per year as of the first quarter. The Company has bought back $250.0 million in convertible subordinated notes and common stock under its current buyback Buyback The buying back of outstanding shares (repurchase) by a company in order to reduce the number of shares on the market. Companies will buyback shares either to increase the value of shares still available (reducing supply), or to eliminate any threats by shareholders who may program, and has remaining $25.0 million authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: for additional purchases. In the first quarter of fiscal year 2004, the Company recorded a $2.8 million pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta gain on the repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of convertible subordinated notes. Shipments of all product lines, except for Test and Measurement and Desktop Power Management, increased sequentially in the first quarter of fiscal year 2004. Portable Power Management sales were up 11 percent sequentially and up 136 percent compared to the prior year period. Protection Product sales in the first quarter were up 9 percent from the prior quarter and Advanced Communications product sales were up 27 percent. New orders in the first quarter of fiscal year 2004 were up slightly over the prior quarter. The largest percentage increases were in the Test and Measurement and Human Input Device (HID) product lines. The largest decline in new orders was in Desktop Power Management, reflecting lower demand from the computer gaming segment and delays in new desktop designs. Orders from desktop computer customers are forecasted to improve toward the end of the second quarter, as Semtech begins to benefit from increased market-share in next generation systems. Jack Poe, Semtech's Chairman 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. , commented, "Sales of products used in portable applications remained strong in the first quarter and were up over 105 percent compared to the prior year. In particular, our market-share in powering notebook computers 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. and color screens in cellular phones has increased substantially. First quarter results were negatively impacted by seasonal weakness and average selling price The average sales price of goods or commodities. Especially used in the retail sector and technology distribution. declines in products sold into the desktop computer market. Sales to computer gaming and automated au·to·mate v. au·to·mat·ed, au·to·mat·ing, au·to·mates v.tr. 1. To convert to automatic operation: automate a factory. 2. test equipment (ATE) customers were also weak." Mr. Poe added, "New orders were at their highest level in the past four quarters and suggest there will be improved growth opportunities in the second half of fiscal year 2004. We expect continued strength in portable applications and improvements in the desktop, ATE and telecom end-markets to begin late in the second quarter." The expected improvement in second half conditions is broad based, including assumed higher rates of growth from several newer product lines. Semtech's highly proprietary SETS product line, used for timing and synchronization (1) See synchronous and synchronous transmission. (2) Ensuring that two sets of data are always the same. See data synchronization. (3) Keeping time-of-day clocks in two devices set to the same time. See NTP. in high-end networking systems, is benefiting from design wins secured in the last two years. Semtech's industry leading HID technology is gaining traction Traction Definition Traction is the use of a pulling force to treat muscle and skeleton disorders. Purpose Traction is usually applied to the arms and legs, the neck, the backbone, or the pelvis. at several major OEMs. Finally, the Networking/Industrial Power Management product line secured 33 new design wins in the first quarter, including designs with power supply makers which support broad end-applications. Semtech estimates that net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the second quarter of fiscal year 2004 will be flat to up 2 percent from the first quarter. Turns orders (orders received and shipped in the same quarter) of approximately 51 percent are required to achieve this forecast. Gross margin and 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. are forecasted to improve. Interest and other income will be down in the coming quarter due to lower rates of return on investments and the expected absence of gain on the repurchase of convertible subordinated notes. Earnings per diluted share are forecasted to be either 9 or 10 cents in the second quarter. About Semtech Semtech Corporation is a leading supplier of analog and mixed-signal semiconductors used in a wide range of computer, industrial and communication applications. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Provision Statements contained in this release that are not historical facts are 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 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. Forward-looking statements, including projections and forecasts for revenue and gross margin, involve risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include worldwide economic and political conditions, the timing and duration of semiconductor market upturns or downturns, demand for personal computers, cellular phones and automated test equipment, demand for semiconductor devices in general, competitors' actions, relations with large strategic customers and suppliers, manufacturing costs and yields, demand for the Company's products in particular, and risks associated with the businesses of major customers. Other factors that may cause actual results to differ from the forward-looking statements contained in this press release and that may affect the Company's prospects in general are described in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise forward-looking statements to reflect subsequent events or changed assumptions or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or .
SEMTECH CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In thousands - except per share amounts)
Three Months Ended
April 27, April 28,
2003 2002
Net sales $44,017 $49,188
Cost of sales 19,160 21,108
Gross profit 24,857 28,080
Operating costs and expenses:
Selling, general and
administrative 8,946 8,412
Product development and
engineering 7,825 7,524
Total operating costs and
expenses 16,771 15,936
Operating income 8,086 12,144
Interest and other income,
net 2,792 1,179
Income before provision for taxes 10,878 13,323
Provision for taxes 2,611 3,331
Net income $8,267 $9,992
Earnings per share:
Basic $0.11 $0.14
Diluted $0.11 $0.13
Weighted average number of shares:
Basic 73,236 72,681
Diluted 76,522 78,997
Notes regarding Consolidated Statements of Income:
1.) In the first quarter of fiscal year 2004, $484,000 of
previously written-off inventory was sold and $229,000 of previously
written-off inventory was sold in the first quarter of fiscal year
2003.
2.) "Interest and other income, net" includes a gain on the
repurchase of convertible subordinated notes of $2.8 million in the
first quarter of fiscal year 2004 and a loss of $38,000 in the first
quarter of fiscal year 2003.
SEMTECH CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)
April 27, January 26,
2003 2003
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $147,800 $137,041
Temporary investments 225,769 273,382
Receivables, less allowances 21,117 17,676
Inventories 14,673 16,351
Income taxes refundable 6,011 -
Deferred income taxes 5,331 11,731
Other current assets 4,125 2,267
Total current assets 424,826 458,448
Property, plant and equipment, net 50,366 51,547
Investments, maturities in excess of 1
year 56,759 78,624
Deferred income taxes 25,593 27,143
Other assets 3,591 4,784
Total Assets $561,135 $620,546
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $8,876 $5,725
Accrued liabilities 13,984 26,596
Income taxes payable 4,030 3,593
Deferred revenue 1,269 1,583
Other current liabilities 44 39
Total current liabilities 28,203 37,536
Long-term debt 182,070 241,570
Total Stockholders' equity 350,862 341,440
Total Liabilities and Stockholders'
Equity $561,135 $620,546
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