UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| x | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the Quarterly Period Ended March 30, 2003
or
| ¨ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the transition period from to
Commission File No. 0-8866
| MICROSEMI CORPORATION |
| (Exact name of registrant as specified in its charter) |
| Delaware |
95-2110371 | |
| (State or other jurisdiction of |
(I.R.S. Employer | |
| incorporation or organization) |
Identification No.) |
| 2381 Morse Avenue, Irvine, California |
92614 | |
| (Address of principal executive offices) |
(Zip Code) | |
| (949) 221-7100 |
||||
| (Registrant’s telephone number, including area code) |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes x No ¨
The number of shares of the issuer’s Common Stock, $0.20 par value, outstanding on April 25, 2003 was 28,939,985.
PART I—FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
The unaudited consolidated income statements for the quarter and six months ended March 30, 2003 of Microsemi Corporation and Subsidiaries (“Microsemi” or the “Company”), the Company’s unaudited consolidated statements of cash flows for the six months ended March 30, 2003, and the comparative unaudited consolidated financial information for the corresponding periods of the prior year, together with the Company’s unaudited balance sheets as of March 30, 2003 and as of September 29, 2002, are attached hereto and incorporated herein.
2
MICROSEMI CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Balance Sheets
(amounts in thousands, except per share data)
| September 29, 2002 |
March 30, 2003 | ||||||
| ASSETS |
|||||||
| Current assets: |
|||||||
| Cash and cash equivalents |
$ |
23,060 |
|
$ |
22,583 | ||
| Accounts receivable, net of allowance for doubtful accounts, $1,740 at September 29, 2002 and $1,427 at March 30, 2003 |
|
32,435 |
|
|
28,887 | ||
| Inventories |
|
52,040 |
|
|
50,407 | ||
| Deferred income taxes |
|
3,736 |
|
|
3,736 | ||
| Other current assets |
|
2,698 |
|
|
2,446 | ||
| Total current assets |
|
113,969 |
|
|
108,059 | ||
| Property and equipment, net |
|
65,608 |
|
|
62,553 | ||
| Deferred income taxes |
|
1,641 |
|
|
1,641 | ||
| Goodwill and other intangible assets, net |
|
33,824 |
|
|
33,192 | ||
| Other assets |
|
1,726 |
|
|
4,313 | ||
| TOTAL ASSETS |
$ |
216,768 |
|
$ |
209,758 | ||
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
|||||||
| Current liabilities: |
|||||||
| Notes payable |
$ |
144 |
|
$ |
121 | ||
| Current maturities of long-term debt |
|
167 |
|
|
89 | ||
| Accounts payable |
|
12,559 |
|
|
9,963 | ||
| Accrued liabilities |
|
17,052 |
|
|
14,695 | ||
| Income taxes payable |
|
— |
|
|
125 | ||
| Total current liabilities |
|
29,922 |
|
|
24,993 | ||
| Long-term debt |
|
4,356 |
|
|
494 | ||
| Other long-term liabilities |
|
4,044 |
|
|
3,993 | ||
| Commitments and contingencies (Note 3) |
|||||||
| Stockholders’ equity: |
|||||||
| Preferred stock |
|
— |
|
|
— | ||
| Common stock, $.20 par value; authorized 100,000 shares; issued and outstanding 28,895 and 28,940 at September 29, 2002 and March 30, 2003, respectively |
|
5,779 |
|
|
5,789 | ||
| Capital in excess of par value of common stock |
|
118,451 |
|
|
118,640 | ||
| Retained earnings |
|
55,387 |
|
|
55,849 | ||
| Accumulated other comprehensive loss |
|
(1,171 |
) |
|
— | ||
| Total stockholders’ equity |
|
178,446 |
|
|
180,278 | ||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
216,768 |
|
$ |
209,758 | ||
The accompanying notes are an integral part of these statements.
3
MICROSEMI CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Income Statements
(amounts in thousands, except per share data)
| Quarter Ended |
||||||||
| March 31, 2002 |
March 30, 2003 |
|||||||
| Net sales |
$ |
54,969 |
|
$ |
48,217 |
| ||
| Cost of sales |
|
36,615 |
|
|
33,490 |
| ||
| Gross profit |
|
18,354 |
|
|
14,727 |
| ||
| Operating expenses: |
||||||||
| Selling, general and administrative |
|
10,088 |
|
|
9,091 |
| ||
| Research and development |
|
5,793 |
|
|
4,825 |
| ||
| Amortization of goodwill and other intangible assets |
|
844 |
|
|
390 |
| ||
| Restructuring charges |
|
3,735 |
|
|
— |
| ||
| Gain on sale of asset |
|
— |
|
|
(2,821 |
) | ||
| Asset Impairment |
|
1,607 |
|
|
— |
| ||
| Total operating expenses |
|
22,067 |
|
|
11,485 |
| ||
| Operating income (loss) |
|
(3,713 |
) |
|
3,242 |
| ||
| Other income (expense): |
||||||||
| Interest, net |
|
(169 |
) |
|
(108 |
) | ||
| Other, net |
|
(51 |
) |
|
3 |
| ||
| Total other expense |
|
(220 |
) |
|
(105 |
) | ||
| Income (loss) before income taxes |
|
(3,933 |
) |
|
3,137 |
| ||
| Provision (benefit) for income taxes |
|
(1,298 |
) |
|
1,035 |
| ||
| Net income (loss) |
$ |
(2,635 |
) |
$ |
2,102 |
| ||
| Earnings (loss) per share: |
||||||||
| -Basic |
$ |
(0.09 |
) |
$ |
0.07 |
| ||
| -Diluted |
$ |
(0.09 |
) |
$ |
0.07 |
| ||
| Weighted average common and common equivalent shares outstanding: |
||||||||
| -Basic |
|
28,607 |
|
|
28,934 |
| ||
| -Diluted |
|
28,607 |
|
|
29,340 |
| ||
The accompanying notes are an integral part of these statements.
4
MICROSEMI CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Income Statements
(amounts in thousands, except per share data)
| Six Months Ended |
||||||||
| March 31, 2002 |
March 30, 2003 |
|||||||
| Net sales |
$ |
111,987 |
|
$ |
94,086 |
| ||
| Cost of sales |
|
71,814 |
|
|
66,330 |
| ||
| Gross profit |
|
40,173 |
|
|
27,756 |
| ||
| Operating expenses: |
||||||||
| Selling, general and administrative |
|
19,207 |
|
|
18,108 |
| ||
| Research and development |
|
10,947 |
|
|
9,788 |
| ||
| Amortization of goodwill and other intangible assets |
|
1,936 |
|
|
713 |
| ||
| Restructuring charges |
|
3,735 |
|
|
686 |
| ||
| Gain on sales of assets, net |
|
— |
|
|
(2,393 |
) | ||
| Asset impairments |
|
1,607 |
|
|
— |
| ||
| Total operating expenses |
|
37,432 |
|
|
26,902 |
| ||
| Operating income |
|
2,741 |
|
|
854 |
| ||
| Other income (expense): |
||||||||
| Interest, net |
|
(330 |
) |
|
(138 |
) | ||
| Other, net |
|
16 |
|
|
(27 |
) | ||
| Total other expense |
|
(314 |
) |
|
(165 |
) | ||
| Income before income taxes |
|
2,427 |
|
|
689 |
| ||
| Provision for income taxes |
|
801 |
|
|
227 |
| ||
| Net income |
$ |
1,626 |
|
$ |
462 |
| ||
| Earnings per share: |
||||||||
| -Basic |
$ |
0.06 |
|
$ |
0.02 |
| ||
| -Diluted |
$ |
0.06 |
|
$ |
0.02 |
| ||