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8-K - 8-K - INTERNATIONAL RECTIFIER CORP /DE/a14-19384_38k.htm

Exhibit 99.1

 

International Rectifier Reports Fourth Quarter and Full Year Fiscal 2014 Results

 

EL SEGUNDO, Calif.—(BUSINESS WIRE)—August 20, 2014— International Rectifier Corporation (NYSE:IRF) today announced financial results for the fourth quarter (ended June 29, 2014) of its fiscal year 2014.

 

On August 20, 2014, International Rectifier Corporation entered into a definitive agreement with Infineon Technologies AG under which Infineon has agreed to acquire International Rectifier for $40 per share in an all-cash transaction valued at approximately $3.0 billion.  In anticipation of this transaction which is expected to close late in the calendar year 2014 or early in the calendar year 2015 subject to regulatory approval, International Rectifier will not conduct a fourth quarter results conference call nor issue financial guidance for the upcoming quarter.  International Rectifier is also discontinuing its share repurchase program.

 

Revenue for the June quarter was $297.6 million, a 10.5% increase compared to $269.3 million in the prior quarter and a 7.6% increase from $276.5 million in the prior year quarter.  GAAP net income for the fourth quarter was $12.9 million, or $0.18 per fully diluted share compared to GAAP net income of $19.1 million, or $0.26 per fully diluted share, in the prior quarter and GAAP net loss of $6.1 million, or $0.09 per fully diluted share in the prior year quarter.

 

Revenue for fiscal year 2014 was $1,106.6 million, a 13.3% increase from $977.0 million in the prior fiscal year.  Net income for fiscal year 2014 was $58.7 million or $0.81 per fully diluted share compared with a net loss of $88.8 million or $1.28 per fully diluted share for fiscal year 2013.

 

“Fourth quarter revenue exceeded our expectations, increasing significantly as all of our business segments posted sequential growth,” stated President and Chief Executive Officer Oleg Khaykin. “In addition, we reduced inventory by about 5% bringing our inventory weeks to 15.6, the lowest level in four years and below our target level of 16 weeks. Our non-GAAP operating income increased to 8.2% of revenue in the fourth quarter and we increased our cash balance by $67.7 million.”

 

GAAP gross margin for the fourth quarter was 35.6% compared to 37.2% in the prior quarter and 30.0% in the prior year quarter.  GAAP operating income for the fourth quarter was $20.7 million compared to operating income of $19.2 million in the prior quarter and operating income of $0.2 million in the prior year quarter.

 

Cash, cash equivalents and marketable investments increased $67.7 million and totaled $610.4 million at the end of the fourth quarter, including restricted cash of $1.4 million.

 

Cash provided by operating activities for the quarter was $70.3 million and free cash flow was $62.0 million.

 

Non-GAAP Results

 

Non-GAAP net income for the fourth quarter was $21.9 million, or $0.30 per fully diluted share compared to non-GAAP net income of $19.7 million, or $0.27 per fully diluted share in the prior quarter and non-GAAP net loss of $1.2 million, or $0.02 per fully diluted share in the prior year quarter.

 

Non-GAAP gross margin for the fourth quarter was 35.7% compared to non-GAAP gross margin of 36.3% in the prior quarter and non-GAAP gross margin of 30.2% in the prior year quarter.  Non-GAAP operating income for the fourth quarter was $24.3 million compared to non-GAAP operating income of $20.1 million in the prior quarter and non-GAAP operating income of $4.5 million in the prior year quarter.

 

Non-GAAP net income for fiscal year 2014 was $70.2 million or $0.97 per fully diluted share compared with a non-GAAP net loss of $62.6 million or $0.90 per fully diluted share for fiscal year 2013.

 

The non-GAAP results the Company provides exclude the effects of accelerated depreciation, asset impairment, inventory write-offs associated with our El Segundo fab closure, restructuring costs, severance costs, impairment of goodwill, amortization of intangibles, the associated net tax effects of these items, and discrete tax provisions and benefits.  The Company excludes any tax provisions (benefits) that are not directly related to ongoing operations and which are either isolated or cannot be expected to occur again with any regularity or predictability.

 



 

A reconciliation of these non-GAAP measures to the Company’s reported net income (loss), gross margin (referred to as gross profit in attached schedules) and operating income (loss) in accordance with U.S. GAAP are set forth in the attached schedules below and on our web-site at www.investor.irf.com.

 

Segment Table Information/Customer Segments

 

The business segment tables included with this release for the Company’s fiscal quarters ended June 29, 2014, March 30, 2014, and June 30, 2013, respectively, reconcile revenue and gross margin for the Company’s segments to the consolidated total amounts of such measures for the Company.

 

Annual Report on Form 10-K

 

The Company expects to file its Annual Report on Form 10-K for the 2014 fiscal year with the Securities and Exchange Commission by Thursday, August 21, 2014.  This financial report will be available for viewing and download at http://investor.irf.com.

 

Conference Call Information:  On August 20, 2014, International Rectifier Corporation entered into a definitive agreement with Infineon Technologies AG under which Infineon has agreed to acquire International Rectifier for $40 per share in an all-cash transaction valued at approximately $3.0 billion.  In anticipation of this transaction which is expected to close late in the calendar year 2014 or early in the calendar year 2015 subject to regulatory approvals, International Rectifier will not conduct a fourth quarter results conference call nor issue financial guidance for the upcoming quarter.

 



 

About International Rectifier

 

International Rectifier Corporation (NYSE:IRF) is a world leader in power management technology.  IR’s analog, digital, and mixed signal ICs, and other advanced power management products, enable high performance computing and save energy in a wide variety of business and consumer applications.  Leading manufacturers of computers, energy efficient appliances, lighting, automobiles, satellites, aircraft, and defense systems rely on IR’s power management solutions to power their next generation products. For more information, go to www.irf.com.

 

Forward-Looking Statements:

 

This document contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  These statements relate to expectations concerning matters that (a) are not historical facts, (b) predict or forecast future events or results, or (c) embody assumptions that may prove to have been inaccurate.  These forward-looking statements involve risks, uncertainties and assumptions.  When we use words such as “believe,” “expect,” “anticipate,” “will”, “outlook” or similar expressions, we are making forward-looking statements.  Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give readers any assurance that such expectations will prove correct.  The actual results may differ materially from those anticipated in the forward-looking statements as a result of numerous factors, many of which are beyond our control.  Important factors that could cause actual results to differ materially from our expectations include, but are not limited to, lower than expected demand or greater than expected order cancellations arising from a decline or volatility in general market and economic conditions and the failure of the market to improve as anticipated; reduced margins from lower than expected factory utilization, higher than expected costs and customer shifts to lower margin products; changes in the timing or amount of costs associated with, or disruptions caused by, our restructuring initiatives; our ability to implement our restructuring initiatives as planned and achieve the anticipated benefits, which may be affected by, among other things: customer requirements, changes in business conditions and/or operational needs, retention of key employees, governmental regulations, delays and increased costs; unexpected costs or delays in implementing our plans to secure and qualify external manufacturing capacity for our products, including the purchase and installation of additional manufacturing equipment and the construction of our new wafer thinning manufacturing facility in Singapore; the effects of longer lead times for certain products on meeting demand and any inability by us to satisfy or to timely satisfy customer demand; volatility or deterioration of capital markets; the adverse impact of regulatory, investigative and legal actions; increased competition in the highly competitive semiconductor business that could adversely affect the prices of our products or our ability to secure additional business; the effects of manufacturing, operational and vendor disruptions; unexpected delays and disruptions in our supply, manufacturing and delivery efforts due to, among other things, supply constraints, equipment malfunction or natural disasters; delays in launching new technology products; our ability to maintain current intellectual property licenses and obtain new intellectual property licenses; costs arising from pending and threatened litigation or claims; the effects of natural disasters; the risk that the transaction with Infineon Technologies AG will not close or that the closing may be delayed; the possibility that the conditions to the closing of the transaction with Infineon Technologies AG may not be satisfied; the risk that competing offers to the transaction with Infineon Technologies AG will be made; the outcome of any legal proceedings related to the transaction with Infineon Technologies AG; the occurrence of any event, change or other circumstances that could give rise to the termination of the definitive agreement entered into with Infineon Technologies AG; general economic conditions; conditions in the markets Infineon Technologies AG and International Rectifier are engaged in; behavior of customers, suppliers and competitors (including their reaction to the transaction); and other uncertainties disclosed in the Company’s reports filed from time to time with the Securities and Exchange Commission, including its most recent reports on Forms 10-K and 10-Q.

 



 

INTERNATIONAL RECTIFIER CORPORATION AND SUBSIDIARIES

 

CONSOLIDATED STATEMENT OF OPERATIONS

 

(In thousands, except per share data)

 

 

 

Three Months Ended

 

Fiscal Year Ended

 

 

 

June 29, 2014

 

March 30, 2014

 

June 30, 2013

 

 

 

 

 

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

June 29, 2014

 

June 30, 2013

 

Revenues

 

$

297,587

 

$

269,269

 

$

276,453

 

$

1,106,571

 

$

977,035

 

Cost of sales

 

191,789

 

169,135

 

193,386

 

707,363

 

719,930

 

Gross profit

 

105,798

 

100,134

 

83,067

 

399,208

 

257,105

 

Selling, general and administrative expense

 

48,816

 

45,025

 

46,348

 

182,318

 

181,746

 

Research and development expense

 

33,179

 

32,710

 

32,643

 

130,848

 

127,093

 

Amortization of acquisition-related intangible assets

 

1,555

 

1,605

 

1,630

 

6,420

 

6,653

 

Asset impairment, restructuring and related charges

 

1,597

 

1,624

 

2,209

 

5,638

 

16,996

 

Operating income (loss)

 

20,651

 

19,170

 

237

 

73,984

 

(75,383

)

Other expense, net

 

251

 

451

 

421

 

2,974

 

1,390

 

Interest (income) expense, net

 

(10

)

28

 

33

 

24

 

57

 

Income (loss) before income taxes

 

20,410

 

18,691

 

(217

)

70,986

 

(76,830

)

Provision for (benefit from) income taxes

 

7,461

 

(449

)

5,861

 

12,253

 

11,990

 

Net income (loss)

 

$

12,949

 

$

19,140

 

$

(6,078

)

$

58,733

 

$

(88,820

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per common share:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.18

 

$

0.27

 

$

(0.09

)

$

0.83

 

$

(1.28

)

Diluted

 

$

0.18

 

$

0.26

 

$

(0.09

)

$

0.81

 

$

(1.28

)

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

71,208

 

71,248

 

69,785

 

71,108

 

69,385

 

Diluted

 

72,874

 

72,728

 

69,785

 

72,549

 

69,385

 

 



 

INTERNATIONAL RECTIFIER CORPORATION AND SUBSIDIARIES

 

CONSOLIDATED BALANCE SHEETS

 

(In thousands)

 

 

 

June 29, 2014

 

June 30, 2013

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

588,922

 

$

443,490

 

Restricted cash

 

635

 

611

 

Short-term investments

 

20,114

 

11,056

 

Trade accounts receivable, net of allowances of $352 for 2014 and $915 for 2013

 

161,723

 

137,762

 

Inventories

 

230,011

 

232,315

 

Current deferred tax assets

 

2,145

 

4,948

 

Prepaid expenses and other receivables

 

26,675

 

33,002

 

Total current assets

 

1,030,225

 

863,184

 

Restricted cash

 

739

 

738

 

Property, plant and equipment, net

 

391,765

 

423,338

 

Goodwill

 

52,149

 

52,149

 

Acquisition-related intangible assets, net

 

15,503

 

21,923

 

Long-term deferred tax assets

 

31,183

 

32,792

 

Other assets

 

43,976

 

59,088

 

Total assets

 

$

1,565,540

 

$

1,453,212

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

86,256

 

$

89,312

 

Accrued income taxes

 

2,946

 

949

 

Accrued salaries, wages and commissions

 

47,750

 

39,719

 

Current deferred tax liabilities

 

348

 

 

Other accrued expenses

 

72,968

 

78,414

 

Total current liabilities

 

210,268

 

208,394

 

Long-term deferred tax liabilities

 

7,817

 

8,970

 

Other long-term liabilities

 

19,809

 

24,530

 

Total liabilities

 

237,894

 

241,894

 

Commitments and contingencies

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Preferred shares, $1 par value, authorized: 1,000,000; issued and outstanding: none in 2014 and 2013

 

 

 

Common shares, $1 par value, authorized: 330,000,000; outstanding: 71,520,121 shares in 2014 and 70,399,081 shares in 2013

 

78,192

 

76,590

 

Capital contributed in excess of par value

 

1,097,665

 

1,067,841

 

Treasury stock, at cost: 6,672,216 shares in 2014 and 6,191,082 shares in 2013

 

(125,785

)

(113,175

)

Retained earnings

 

260,598

 

201,865

 

Accumulated other comprehensive loss

 

16,976

 

(21,803

)

Total stockholders’ equity

 

1,327,646

 

1,211,318

 

Total liabilities and stockholders’ equity

 

$

1,565,540

 

$

1,453,212

 

 



 

INTERNATIONAL RECTIFIER CORPORATION AND SUBSIDIARIES

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(In thousands)

 

 

 

Three Months Ended

 

Fiscal Year Ended

 

 

 

June 29, 2014
(Unaudited)

 

June 30, 2013
(Unaudited)

 

June 29, 2014

 

June 30, 2013

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

12,949

 

$

(6,078

)

$

58,733

 

$

(88,820

)

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

21,817

 

22,625

 

87,210

 

91,187

 

Amortization of acquisition-related intangible assets

 

1,555

 

1,630

 

6,420

 

6,653

 

(Gain) loss on disposal of fixed assets

 

(444

)

703

 

(264

)

5,036

 

Impairment of long-lived assets

 

80

 

1

 

80

 

2,792

 

Stock compensation expense

 

6,467

 

5,146

 

26,494

 

21,560

 

Gain on sale of investments

 

 

 

(36

)

(8

)

Other-than-temporary impairment of investments

 

 

 

 

350

 

Provision for (recovery of) bad debts

 

 

4

 

 

(58

)

Provision for inventory write-downs

 

1,273

 

5,142

 

4,900

 

20,421

 

Loss on derivatives

 

276

 

469

 

1,437

 

634

 

Deferred income taxes

 

1,412

 

5,769

 

7,338

 

11,384

 

Tax benefit from stock-based awards

 

219

 

 

219

 

 

Changes in operating assets and liabilities, net

 

25,690

 

21,657

 

(11,190

)

65,046

 

Other

 

(999

)

697

 

(1,255

)

3,219

 

Net cash provided by operating activities

 

70,295

 

57,765

 

180,086

 

139,396

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

Additions to property, plant and equipment

 

(8,275

)

(11,681

)

(44,111

)

(72,605

)

Proceeds from sale of property, plant and equipment

 

978

 

 

1,003

 

118

 

Sale of investments

 

 

 

36

 

52,131

 

Maturities of investments

 

 

4,000

 

11,000

 

25,500

 

Purchase of investments

 

 

 

 

(9,979

)

Release from restricted cash

 

13

 

2

 

27

 

176

 

Net cash used in investing activities

 

(7,284

)

(7,679

)

(32,045

)

(4,659

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

Proceeds from exercise of stock options

 

1,508

 

11,132

 

14,146

 

15,474

 

Purchase of treasury stock

 

(10,012

)

 

(12,610

)

(5,210

)

Net settlement of restricted stock units for tax withholdings

 

(8,273

)

(3,972

)

(9,433

)

(5,464

)

Net cash (used in) provided by financing activities

 

(16,777

)

7,160

 

(7,897

)

4,800

 

Effect of exchange rate changes on cash and cash equivalents

 

1,400

 

(750

)

5,288

 

(1,470

)

Net increase in cash and cash equivalents

 

47,634

 

56,496

 

145,432

 

138,067

 

Cash and cash equivalents, beginning of period

 

541,288

 

386,994

 

443,490

 

305,423

 

Cash and cash equivalents, end of period

 

$

588,922

 

$

443,490

 

$

588,922

 

$

443,490

 

 



 

For the three months ended June 29, 2014, March 30, 2014, and June 30, 2013, revenue and gross margin by reportable segments were as follows (in thousands, except percentages):

 

 

 

Three Months Ended

 

 

 

June 29, 2014

 

March 30, 2014

 

June 30, 2013

 

Business Segment

 

Revenues

 

Percentage
of Total

 

Gross
Margin

 

Revenues

 

Percentage
of Total

 

Gross
Margin

 

Revenues

 

Percentage
of Total

 

Gross
Margin

 

Power management devices

 

$

110,255

 

37.0

%

33.8

%

$

96,868

 

36.0

%

30.9

%

$

108,453

 

39.2

%

28.8

%

Energy saving products

 

58,556

 

19.7

 

26.9

 

53,808

 

20.0

 

33.7

 

52,142

 

18.9

 

19.2

 

Automotive products

 

38,918

 

13.1

 

26.3

 

37,901

 

14.1

 

28.4

 

36,337

 

13.1

 

25.1

 

Enterprise power

 

36,446

 

12.2

 

39.5

 

32,057

 

11.9

 

45.3

 

29,355

 

10.6

 

30.1

 

HiRel

 

53,091

 

17.8

 

52.5

 

48,323

 

17.9

 

54.9

 

49,802

 

18.0

 

47.3

 

Customer segments total

 

297,266

 

99.9

 

35.5

 

268,957

 

99.9

 

37.1

 

276,089

 

99.9

 

30.0

 

Intellectual property

 

321

 

0.1

 

100.0

 

312

 

0.1

 

100.0

 

364

 

0.1

 

100.0

 

Consolidated total

 

$

297,587

 

100.0

%

35.6

%

$

269,269

 

100.0

%

37.2

%

$

276,453

 

100.0

%

30.0

%

 

For the fiscal years ended June 29, 2014 and June 30, 2013, revenue and gross margin by reportable segments were as follows (in thousands, except percentages):

 

 

 

Fiscal Year Ended

 

 

 

June 29, 2014

 

June 30, 2013

 

Business Segment

 

Revenues

 

Percentage
of Total

 

Gross
Margin

 

Revenues

 

Percentage
of Total

 

Gross
Margin

 

Power management devices

 

$

411,967

 

37.2

%

31.4

%

$

367,762

 

37.6

%

21.7

%

Energy saving products

 

209,450

 

18.9

 

31.1

 

176,386

 

18.1

 

15.3

 

Automotive products

 

149,646

 

13.5

 

29.5

 

124,695

 

12.8

 

17.7

 

Enterprise power

 

133,947

 

12.1

 

41.1

 

116,302

 

11.9

 

32.5

 

HiRel

 

200,412

 

18.1

 

52.0

 

188,831

 

19.3

 

46.7

 

Customer segments total

 

1,105,422

 

99.9

 

36.0

 

973,976

 

99.7

 

26.2

 

Intellectual property

 

1,149

 

0.1

 

100.0

 

3,059

 

0.3

 

78.4

 

Consolidated total

 

$

1,106,571

 

100.0

%

36.1

%

$

977,035

 

100.0

%

26.3

%

 

For the three months ended June 29, 2014, March 30, 2014, and June 30, 2013, stock-based compensation was as follows (in thousands):

 

 

 

Three Months Ended

 

 

 

June 29, 2014

 

March 30, 2014

 

June 30, 2013

 

Cost of sales

 

$

1,302

 

$

1,330

 

$

1,091

 

Selling, general and administrative expense

 

3,260

 

3,233

 

2,455

 

Research and development expense

 

1,905

 

1,975

 

1,600

 

Total stock-based compensation expense

 

$

6,467

 

$

6,538

 

$

5,146

 

 



 

For the fiscal years ended June 29, 2014, and June 30, 2013, stock-based compensation was as follows (in thousands):

 

 

 

Fiscal Year Ended

 

 

 

June 29, 2014

 

June 30, 2013

 

Cost of sales

 

$

5,242

 

$

4,393

 

Selling, general and administrative expense

 

13,144

 

11,166

 

Research and development expense

 

8,108

 

6,001

 

Total stock-based compensation expense

 

$

26,494

 

$

21,560

 

 



 

INTERNATIONAL RECTIFIER CORPORATION AND SUBSIDIARIES

 

NON-GAAP RESULTS

 

(In thousands, except per share and gross profit-percentage data)

 

Reconciliation of GAAP to Non-GAAP Gross Profit:

 

 

 

Three Months Ended

 

Fiscal Year Ended

 

 

 

June 29, 2014

 

March 30, 2014

 

June 30, 2013

 

June 29, 2014

 

June 30, 2013

 

GAAP Gross profit

 

$

105,798

 

$

100,134

 

$

83,067

 

$

399,208

 

$

257,105

 

Adjustments to reconcile GAAP to Non-GAAP gross profit:

 

 

 

 

 

 

 

 

 

 

 

Impairment of long-lived assets

 

 

 

 

 

2,792

 

Accelerated depreciation

 

509

 

507

 

417

 

2,097

 

1,683

 

Product litigation reserve release

 

 

(2,790

)

 

(2,790

)

 

Non-GAAP gross profit

 

$

106,307

 

$

97,851

 

$

83,484

 

$

398,515

 

$

261,580

 

Non-GAAP gross profit-percentage

 

35.7

%

36.3

%

30.2

%

36.0

%

26.8

%

 

Reconciliation of GAAP to Non-GAAP Operating Income (Loss):

 

 

 

Three Months Ended

 

Fiscal Year Ended

 

 

 

June 29, 2014

 

March 30, 2014

 

June 30, 2013

 

June 29, 2014

 

June 30, 2013

 

GAAP Operating income (loss)

 

$

20,651

 

$

19,170

 

$

237

 

$

73,984

 

$

(75,383

)

Adjustments to reconcile GAAP to Non-GAAP operating loss:

 

 

 

 

 

 

 

 

 

 

 

Impairment of long-lived assets

 

 

 

 

 

2,792

 

Accelerated depreciation

 

509

 

507

 

417

 

2,097

 

1,683

 

Product litigation reserve release

 

 

(2,790

)

 

(2,790

)

 

Amortization of acquisition-related intangible assets

 

1,555

 

1,605

 

1,630

 

6,420

 

6,653

 

Asset impairment, restructuring and related charges

 

1,597

 

1,624

 

2,209

 

5,638

 

16,996

 

Non-GAAP operating income (loss)

 

$

24,312

 

$

20,116

 

$

4,493

 

$

85,349

 

$

(47,259

)

 



 

INTERNATIONAL RECTIFIER CORPORATION AND SUBSIDIARIES

 

NON-GAAP RESULTS

 

(In thousands, except per share and gross profit-percentage data)

 

Reconciliation of GAAP to Non-GAAP Net Income (Loss):

 

 

 

Three Months Ended

 

Fiscal Year Ended

 

 

 

June 29, 2014

 

March 30, 2014

 

June 30, 2013

 

June 29, 2014

 

June 30, 2013

 

GAAP Net income (loss)

 

$

12,949

 

$

19,140

 

$

(6,078

)

$

58,733

 

$

(88,820

)

Adjustments to reconcile GAAP to Non-GAAP net income (loss):

 

 

 

 

 

 

 

 

 

 

 

Impairment of long-lived assets

 

 

 

 

 

2,792

 

Accelerated depreciation

 

509

 

507

 

417

 

2,097

 

1,683

 

Product litigation reserve release

 

 

(2,790

)

 

(2,790

)

 

Amortization of acquisition-related intangible assets

 

1,555

 

1,605

 

1,630

 

6,420

 

6,653

 

Asset impairment, restructuring and related charges

 

1,597

 

1,624

 

2,209

 

5,638

 

16,996

 

Tax expense (benefit) of discrete items and other tax adjustments

 

5,319

 

(373

)

664

 

103

 

(1,902

)

Non-GAAP net income (loss)

 

$

21,929

 

$

19,713

 

$

(1,158

)

$

70,201

 

$

(62,598

)

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income (loss) per common share — basic

 

$

0.18

 

$

0.27

 

$

(0.09

)

$

0.83

 

$

(1.28

)

Non-GAAP adjustments per above

 

0.13

 

0.01

 

0.07

 

0.16

 

0.38

 

Non-GAAP net income (loss) per common share — basic

 

$

0.31

 

$

0.28

 

$

(0.02

)

$

0.99

 

$

(0.90

)

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income (loss) per common share — diluted

 

$

0.18

 

$

0.26

 

$

(0.09

)

$

0.81

 

$

(1.28

)

Non-GAAP adjustments per above

 

0.12

 

0.01

 

0.07

 

0.16

 

0.38

 

Non-GAAP net income (loss) per common share — diluted

 

$

0.30

 

$

0.27

 

$

(0.02

)

$

0.97

 

$

(0.90

)

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding — basic

 

71,208

 

71,248

 

69,785

 

71,108

 

69,385

 

Weighted average common shares outstanding — diluted

 

72,874

 

72,728

 

69,785

 

72,549

 

69,385

 

 

We provide non-GAAP net income and non-GAAP net income per share amounts in order to provide meaningful supplemental information regarding our operational performance. These supplemental measures exclude, among other things, accelerated depreciation, inventory write-offs related to fab closures, severance, impairment of goodwill, charges related to the amortization of acquisition-related intangible assets, the impact of asset impairment, restructuring and other charges. We also exclude tax provisions (benefits) that are not directly related to ongoing operations and which are either isolated or cannot be expected to occur again with any regularity or predictability in addition to tax adjustments related to non-GAAP operating income (loss) adjustments.

 

We use non-GAAP measures to evaluate the performance of our core businesses and to estimate future core performance. Since we find these measures to be useful, we believe that investors will benefit from seeing non-GAAP measures in addition to seeing

 



 

our GAAP results. This information facilitates our internal comparisons to our historical operating results as well as to the operating results of our competitors.

 

Our management recognizes that items such as amortization of intangibles and asset impairment, restructuring and other charges can have a material impact on our cash flows and/or our net income. Our GAAP financial statements including our statement of cash flows portray those effects. Although we believe it is useful for investors to see core performance free of non-GAAP adjustments, investors should understand that the excluded items can be expenses and charges that impact the Company’s total cash balance. To gain a complete picture of all effects on the Company’s profit and loss from any and all events, management does (and investors should) consider only the GAAP income statement and the other financial measures. The non-GAAP numbers focus instead upon the core business of the Company, which is only a subset, albeit an important one, of the Company’s performance, and should not be relied upon by investors.

 

Readers are reminded that non-GAAP numbers are merely a supplement to, and not a replacement for, GAAP financial measures. They should be read in conjunction with the GAAP financial measures. It should be noted as well that our non-GAAP information may be different (and contain different inclusions and exclusions as compared to GAAP information) from the non-GAAP information provided by other companies and therefore are not being provided for the purpose of comparisons with other companies.

 

***

 

Company contacts:

 

Investors:

Media:

Chris Toth

Sian Cummins

310.252.7731

310.252.7148