Cirrus Logic, Inc. (Nasdaq: CRUS),a leader in high-precision
analog and digital signal processing components, today announced
financial results for the third quarter of fiscal year 2011, which ended
Dec. 25, 2010.
Revenue for the quarter was $95.6 million, up 47 percent compared to the
same quarter a year ago, and down five percent sequentially from the
previous quarter. Gross margin for the quarter was 55 percent, up
slightly from 54 percent in the third quarter a year ago, and down
slightly from 56 percent for the previous quarter.
Total GAAP operating expenses for the quarter were approximately $29.4
million, compared to $27.7 million in the previous quarter. Non-GAAP
operating expenses for the quarter were approximately $28.0 million
compared to $27.6 million in the previous quarter.
Income from operations on a GAAP basis was approximately $23.1 million,
representing an operating margin of 24 percent. Income from operations
on a non-GAAP basis was $24.5 million, representing a non-GAAP operating
margin of 26 percent
GAAP net income for the quarter was approximately $24.6 million, or
$0.34 per share, based on 71.7 million average diluted shares
outstanding. Non-GAAP net income was $24.2 million, or $0.34 per diluted
share.
A reconciliation of the non-GAAP charges is included in a table below.
“Revenue from portable audio products exceeded our expectations, helping
to drive overall Q3 revenue growth of 47 percent year over year,” said
Jason Rhode, president and chief executive officer, Cirrus Logic.
“Looking at both the fourth quarter and the next fiscal year, we believe
we will continue to grow revenue at a faster rate than the semiconductor
industry as a whole. With the production ramps continuing this next year
in portable audio, new design wins in other audio markets, and ongoing
design activity with our strategic energy initiatives, we are very
excited about the opportunities ahead.”
Outlook for
Fourth Quarter FY 2011 (ending Mar. 26, 2011):
Revenue is expected to range between $88 million and $94 million;
Gross margin is expected to be between 54 percent and 56 percent; and
Combined R&D and SG&A expenses are expected to range between $31
million and $33 million, which include approximately $2.5 million in
share-based compensation and amortization of acquisition-related
intangibles expenses.
Other Highlights and Company News
The company repurchased and retired approximately 1.76 million shares
during the quarter, at an average price of $12.94, while cash and cash
equivalents grew by approximately $8 million during the quarter.
Total employee headcount during the quarter increased to 549
employees, a net increase of 15 employees.
In January, the company began construction on its new headquarters
facility at 800 W. Sixth Street in downtown Austin that is expected to
be completed in the summer of 2012.
Thurman Case, chief financial officer, will be presenting at the
Stifel Nicolaus Technology Conference in San Francisco on February 11,
at 11:00 a.m. ET. A live webcast will be available in the investor
relations section of cirrus website.
Conference Call
Cirrus Logic management will hold a conference call to discuss the
company’s results for the third quarter fiscal year 2011, on January 27,
at 10:30 a.m. ET. The conference call will be simulcast over the
internet in the investor relations section of the company website at http://investor.cirrus.com.
A replay of the conference call will be available on the website listed
above beginning one hour following the completion of the call, or by
calling (303) 590-3030, or toll-free at (800) 406-7325 (Access Code:
4398706).
Shareholders who would like to submit a question to be addressed during
the call are requested to email investor.relations@cirrus.com.
Cirrus Logic, Inc.
Cirrus Logic develops high-precision, analog and mixed-signal integrated
circuits for a broad range of innovative customers. Building on its
diverse analog and signal-processing patent portfolio, Cirrus Logic
delivers highly optimized products for a variety of audio and
energy-related applications. The company operates from headquarters in
Austin, Texas, with offices in Tucson, Ariz., Europe, Japan and Asia.
More information about Cirrus Logic is available at www.cirrus.com.
Use of non-GAAP Financial Information
To supplement Cirrus Logic's financial statements presented on a GAAP
basis, Cirrus has provided non-GAAP financial information, including
non-GAAP operating expenses, non-GAAP net income, non-GAAP income from
operations, non-GAAP operating margin and non-GAAP diluted earnings per
share. A reconciliation of the adjustments to GAAP results is included
in the tables below. Non-GAAP financial information is not meant as a
substitute for GAAP results, but is included because management believes
such information is useful to our investors for informational and
comparative purposes. In addition, certain non-GAAP financial
information is used internally by management to evaluate and manage the
company. As a note, the non-GAAP financial information used by Cirrus
Logic may differ from that used by other companies.
These
non-GAAP measures should be considered in addition to, and not as a
substitute for, the results prepared in accordance with GAAP.
Safe Harbor Statement
Except for historical information contained herein, the matters set
forth in this news release contain forward-looking statements, including
our estimates of fourth quarter fiscal year 2011 revenue, our future
growth rate, gross margin, combined research and development and
selling, general and administrative expense levels, share-based
compensation expense, and amortization of acquired intangible expenses.
In some cases, forward-looking statements are identified by words such
as “expect,” “anticipate,” “target,” “project,” “believe,” “goals,”
“opportunity,” “estimates,” “intend,” and variations of these types of
words and similar expressions.
In addition, any statements that
refer to our plans, expectations, strategies or other characterizations
of future events or circumstances are forward-looking statements.
These
forward-looking statements are based on our current expectations,
estimates and assumptions and are subject to certain risks and
uncertainties that could cause actual results to differ materially.
These risks and uncertainties include, but are not limited to, the
following: the level of orders and shipments during the fourth quarter
of fiscal year 2011, as well as customer cancellations of orders, or the
failure to place orders consistent with forecasts; the loss of a key
customer; and the risk factors listed in our Form 10-K for the year
ended March 27, 2010, and in our other filings with the Securities and
Exchange Commission, which are available at
www.sec.gov
.
The foregoing information concerning our business outlook represents
our outlook as of the date of this news release, and we undertake no
obligation to update or revise any forward-looking statements, whether
as a result of new developments or otherwise.
Cirrus Logic and Cirrus are trademarks of Cirrus Logic Inc.
CRUS-F
Summary financial data follows:
|
CIRRUS LOGIC, INC. |
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS |
(unaudited) |
(in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec. 25, |
|
Sep. 25, |
|
Dec. 26, |
|
Dec. 25, |
|
Dec. 26, |
|
|
2010 |
|
2010 |
|
2009 |
|
2010 |
|
2009 |
|
|
Q3'11 |
|
Q2'11 |
|
Q3'10 |
|
Q3'11 |
|
Q3'10 |
Audio products |
|
$ |
72,716 |
|
|
$ |
71,171 |
|
|
$ |
47,063 |
|
|
$ |
197,875 |
|
|
$ |
113,121 |
|
Energy products |
|
|
22,909 |
|
|
|
29,427 |
|
|
|
18,099 |
|
|
|
80,263 |
|
|
|
45,229 |
|
Net revenue |
|
|
95,625 |
|
|
|
100,598 |
|
|
|
65,162 |
|
|
|
278,138 |
|
|
|
158,350 |
|
Cost of sales |
|
|
43,163 |
|
|
|
43,818 |
|
|
|
30,276 |
|
|
|
122,161 |
|
|
|
74,903 |
|
Gross Profit |
|
|
52,462 |
|
|
|
56,780 |
|
|
|
34,886 |
|
|
|
155,977 |
|
|
|
83,447 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
16,348 |
|
|
|
15,450 |
|
|
|
12,834 |
|
|
|
46,890 |
|
|
|
37,697 |
|
Selling, general and administrative |
|
|
13,431 |
|
|
|
15,372 |
|
|
|
11,428 |
|
|
|
42,814 |
|
|
|
33,245 |
|
Restructuring and other costs, net |
|
|
(395 |
) |
|
|
401 |
|
|
|
86 |
|
|
|
6 |
|
|
|
(79 |
) |
Charge (proceeds) from non-marketable securities |
|
|
- |
|
|
|
500 |
|
|
|
(500 |
) |
|
|
500 |
|
|
|
(500 |
) |
Provision for (proceeds from) litigation expenses and settlements |
|
|
(30 |
) |
|
|
- |
|
|
|
135 |
|
|
|
105 |
|
|
|
(2,610 |
) |
Patent purchase agreement, net |
|
|
- |
|
|
|
(4,000 |
) |
|
|
- |
|
|
|
(4,000 |
) |
|
|
(1,400 |
) |
Total operating expenses |
|
|
29,354 |
|
|
|
27,723 |
|
|
|
23,983 |
|
|
|
86,315 |
|
|
|
66,353 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
23,108 |
|
|
|
29,057 |
|
|
|
10,903 |
|
|
|
69,662 |
|
|
|
17,094 |
|
|
|
|
|
|
|
|
|
|
|
|
Interest income, net |
|
|
212 |
|
|
|
233 |
|
|
|
269 |
|
|
|
673 |
|
|
|
1,108 |
|
Other expense, net |
|
|
(31 |
) |
|
|
(14 |
) |
|
|
(7 |
) |
|
|
(13 |
) |
|
|
(46 |
) |
Income before income taxes |
|
|
23,289 |
|
|
|
29,276 |
|
|
|
11,165 |
|
|
|
70,322 |
|
|
|
18,156 |
|
Provision (benefit) for income taxes |
|
|
(1,332 |
) |
|
|
(1,598 |
) |
|
|
110 |
|
|
|
(2,775 |
) |
|
|
116 |
|
Net income |
|
$ |
24,621 |
|
|
$ |
30,874 |
|
|
$ |
11,055 |
|
|
$ |
73,097 |
|
|
$ |
18,040 |
|
|
|
|
|
|
|
|
|
|
|
|
Basic income per share: |
|
$ |
0.36 |
|
|
$ |
0.45 |
|
|
$ |
0.17 |
|
|
$ |
1.08 |
|
|
$ |
0.28 |
|
Diluted income per share: |
|
$ |
0.34 |
|
|
$ |
0.42 |
|
|
$ |
0.17 |
|
|
$ |
1.02 |
|
|
$ |
0.28 |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
68,074 |
|
|
|
68,513 |
|
|
|
65,302 |
|
|
|
67,731 |
|
|
|
65,279 |
|
Diluted |
|
|
71,695 |
|
|
|
72,878 |
|
|
|
65,632 |
|
|
|
71,868 |
|
|
|
65,452 |
|
|
|
|
|
|
|
|
|
|
|
|
Prepared in accordance with Generally Accepted Accounting Principles |
|
|
|
|
|
|
|
|
|
CIRRUS LOGIC, INC. |
CONSOLIDATED CONDENSED BALANCE SHEET |
(in thousands) |
|
|
|
Dec. 25, |
|
Mar. 27, |
|
Dec. 26, |
|
|
2010 |
|
2010 |
|
2009 |
|
|
(unaudited) |
|
|
|
(unaudited) |
ASSETS |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
28,491 |
|
|
$ |
16,109 |
|
|
$ |
24,831 |
|
Restricted investments |
|
|
5,755 |
|
|
|
5,855 |
|
|
|
5,755 |
|
Marketable securities |
|
|
156,052 |
|
|
|
85,384 |
|
|
|
77,636 |
|
Accounts receivable, net |
|
|
37,266 |
|
|
|
23,963 |
|
|
|
25,131 |
|
Inventories |
|
|
40,196 |
|
|
|
35,396 |
|
|
|
30,408 |
|
Other current assets |
|
|
22,612 |
|
|
|
18,148 |
|
|
|
6,318 |
|
Total Current Assets |
|
|
290,372 |
|
|
|
184,855 |
|
|
|
170,079 |
|
|
|
|
|
|
|
|
Long-term marketable securities |
|
|
- |
|
|
|
34,278 |
|
|
|
25,235 |
|
Property and equipment, net |
|
|
32,919 |
|
|
|
18,674 |
|
|
|
18,499 |
|
Intangibles, net |
|
|
20,688 |
|
|
|
21,896 |
|
|
|
22,654 |
|
Goodwill |
|
|
6,027 |
|
|
|
6,027 |
|
|
|
6,027 |
|
Other assets |
|
|
1,978 |
|
|
|
1,880 |
|
|
|
1,906 |
|
Total Assets |
|
$ |
351,984 |
|
|
$ |
267,610 |
|
|
$ |
244,400 |
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Accounts payable |
|
$ |
25,371 |
|
|
$ |
20,340 |
|
|
$ |
25,172 |
|
Accrued salaries and benefits |
|
|
9,509 |
|
|
|
9,962 |
|
|
|
7,609 |
|
Other accrued liabilities |
|
|
5,034 |
|
|
|
5,100 |
|
|
|
5,047 |
|
Deferred income on shipments to distributors |
|
|
7,108 |
|
|
|
6,488 |
|
|
|
4,033 |
|
Total Current Liabilities |
|
|
47,022 |
|
|
|
41,890 |
|
|
|
41,861 |
|
|
|
|
|
|
|
|
Long-term restructuring accrual |
|
|
179 |
|
|
|
596 |
|
|
|
492 |
|
Other long-term obligations |
|
|
6,113 |
|
|
|
6,523 |
|
|
|
6,555 |
|
|
|
|
|
|
|
|
Stockholders' equity: |
|
|
|
|
|
|
Capital stock |
|
|
982,610 |
|
|
|
952,803 |
|
|
|
950,023 |
|
Accumulated deficit |
|
|
(683,220 |
) |
|
|
(733,553 |
) |
|
|
(753,911 |
) |
Accumulated other comprehensive loss |
|
|
(720 |
) |
|
|
(649 |
) |
|
|
(620 |
) |
Total Stockholders' Equity |
|
|
298,670 |
|
|
|
218,601 |
|
|
|
195,492 |
|
Total Liabilities and Stockholders' Equity |
|
$ |
351,984 |
|
|
$ |
267,610 |
|
|
$ |
244,400 |
|
|
|
|
|
|
|
|
Prepared in accordance with Generally Accepted Accounting Principles |
|
CIRRUS LOGIC, INC. |
RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION |
(unaudited, in thousands, except per share data) |
(not prepared in accordance with GAAP) |
Non-GAAP financial information is not meant as a substitute for GAAP
results, but is included because management believes such information is
useful to our investors for informational and comparative purposes. In
addition, certain non-GAAP financial information is used internally by
management to evaluate and manage the company. As a note, the non-GAAP
financial information used by Cirrus Logic may differ from that used by
other companies. These non-GAAP measures should be considered in
addition to, and not as a substitute for, the results prepared in
accordance with GAAP.
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec. 25, |
|
Sep. 25, |
|
Dec. 26, |
|
Dec. 25, |
|
Dec. 26, |
|
|
2010 |
|
2010 |
|
2009 |
|
2010 |
|
2009 |
Net Income Reconciliation |
|
Q3'11 |
|
Q2'11 |
|
Q3'10 |
|
Q3'11 |
|
Q3'10 |
GAAP Net Income |
|
$ |
24,621 |
|
|
$ |
30,874 |
|
|
$ |
11,055 |
|
|
$ |
73,097 |
|
|
$ |
18,040 |
|
Amortization of acquisition intangibles |
|
|
353 |
|
|
|
353 |
|
|
|
404 |
|
|
|
1,076 |
|
|
|
1,212 |
|
Stock based compensation expense |
|
|
1,467 |
|
|
|
3,025 |
|
|
|
1,397 |
|
|
|
5,848 |
|
|
|
4,133 |
|
Facility Related adjustments |
|
|
- |
|
|
|
(100 |
) |
|
|
(375 |
) |
|
|
(96 |
) |
|
|
(397 |
) |
International sales reorganization charges |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
790 |
|
|
|
- |
|
Provision for (proceeds from) litigation expenses and settlements |
|
|
(30 |
) |
|
|
- |
|
|
|
135 |
|
|
|
105 |
|
|
|
(2,610 |
) |
Restructuring and other costs, net |
|
|
(395 |
) |
|
|
401 |
|
|
|
86 |
|
|
|
6 |
|
|
|
(79 |
) |
Charge (proceeds) from non-marketable securities |
|
|
- |
|
|
|
500 |
|
|
|
(500 |
) |
|
|
500 |
|
|
|
(500 |
) |
Patent purchase agreement, net |
|
|
- |
|
|
|
(4,000 |
) |
|
|
- |
|
|
|
(4,000 |
) |
|
|
(1,400 |
) |
Provision (benefit) for income taxes |
|
|
(1,847 |
) |
|
|
(2,229 |
) |
|
|
- |
|
|
|
(4,076 |
) |
|
|
- |
|
Non-GAAP Net Income |
|
$ |
24,169 |
|
|
$ |
28,824 |
|
|
$ |
12,202 |
|
|
$ |
73,250 |
|
|
$ |
18,399 |
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share Reconciliation |
|
|
|
|
|
|
|
|
|
|
GAAP Diluted income per share |
|
$ |
0.34 |
|
|
$ |
0.42 |
|
|
$ |
0.17 |
|
|
$ |
1.02 |
|
|
$ |
0.28 |
|
Effect of Amortization of acquisition intangibles |
|
|
- |
|
|
|
- |
|
|
|
0.01 |
|
|
|
0.02 |
|
|
|
0.02 |
|
Effect of Stock based compensation expense |
|
|
0.02 |
|
|
|
0.04 |
|
|
|
0.02 |
|
|
|
0.08 |
|
|
|
0.06 |
|
Effect of Facility Related adjustments |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(0.01 |
) |
Effect of International sales reorganization charges |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
0.01 |
|
|
|
- |
|
Effect of Provision for (proceeds from) litigation expenses and settlements |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(0.04 |
) |
Effect of Restructuring and other costs, net |
|
|
- |
|
|
|
0.01 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Effect of Charge (proceeds) from non-marketable securities |
|
|
- |
|
|
|
0.01 |
|
|
|
(0.01 |
) |
|
|
0.01 |
|
|
|
(0.01 |
) |
Effect of Patent purchase agreement, net |
|
|
- |
|
|
|
(0.05 |
) |
|
|
- |
|
|
|
(0.06 |
) |
|
|
(0.02 |
) |
Effect of Provision (benefit) for income taxes |
|
|
(0.02 |
) |
|
|
(0.03 |
) |
|
|
- |
|
|
|
(0.06 |
) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Diluted income per share |
|
$ |
0.34 |
|
|
$ |
0.40 |
|
|
$ |
0.19 |
|
|
$ |
1.02 |
|
|
$ |
0.28 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income Reconciliation |
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income (Loss) |
|
$ |
23,108 |
|
|
$ |
29,057 |
|
|
$ |
10,903 |
|
|
$ |
69,662 |
|
|
$ |
17,094 |
|
GAAP Operating Margin |
|
|
24 |
% |
|
|
29 |
% |
|
|
17 |
% |
|
|
25 |
% |
|
|
11 |
% |
Amortization of acquisition intangibles |
|
|
353 |
|
|
|
353 |
|
|
|
404 |
|
|
|
1,076 |
|
|
|
1,212 |
|
Stock compensation expense - COGS |
|
|
46 |
|
|
|
64 |
|
|
|
55 |
|
|
|
165 |
|
|
|
150 |
|
Stock compensation expense - R&D |
|
|
579 |
|
|
|
617 |
|
|
|
438 |
|
|
|
1,717 |
|
|
|
1,380 |
|
Stock compensation expense - SG&A |
|
|
842 |
|
|
|
2,344 |
|
|
|
904 |
|
|
|
3,966 |
|
|
|
2,603 |
|
Facility Related adjustments |
|
|
- |
|
|
|
(100 |
) |
|
|
(375 |
) |
|
|
(96 |
) |
|
|
(397 |
) |
International sales reorganization charges |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
790 |
|
|
|
- |
|
Provision for (proceeds from) litigation expenses and settlements |
|
|
(30 |
) |
|
|
- |
|
|
|
135 |
|
|
|
105 |
|
|
|
(2,610 |
) |
Restructuring and other costs, net |
|
|
(395 |
) |
|
|
401 |
|
|
|
86 |
|
|
|
6 |
|
|
|
(79 |
) |
Charge (proceeds) from non-marketable securities |
|
|
- |
|
|
|
500 |
|
|
|
(500 |
) |
|
|
500 |
|
|
|
(500 |
) |
Patent purchase agreement, net |
|
|
- |
|
|
|
(4,000 |
) |
|
|
- |
|
|
|
(4,000 |
) |
|
|
(1,400 |
) |
Non-GAAP Operating Income (Loss) |
|
$ |
24,503 |
|
|
$ |
29,236 |
|
|
$ |
12,050 |
|
|
$ |
73,891 |
|
|
$ |
17,453 |
|
Non-GAAP Operating Margin |
|
|
26 |
% |
|
|
29 |
% |
|
|
18 |
% |
|
|
27 |
% |
|
|
11 |
% |
|
|
|
|
|
|
|
|
|
|
|
Operating Expense Reconciliation |
|
|
|
|
|
|
|
|
|
|
GAAP Operating Expenses |
|
$ |
29,354 |
|
|
$ |
27,723 |
|
|
$ |
23,983 |
|
|
$ |
86,315 |
|
|
$ |
66,353 |
|
Amortization of acquisition intangibles |
|
|
(353 |
) |
|
|
(353 |
) |
|
|
(404 |
) |
|
|
(1,076 |
) |
|
|
(1,212 |
) |
Stock compensation expense - R&D |
|
|
(579 |
) |
|
|
(617 |
) |
|
|
(438 |
) |
|
|
(1,717 |
) |
|
|
(1,380 |
) |
Stock compensation expense - SG&A |
|
|
(842 |
) |
|
|
(2,344 |
) |
|
|
(904 |
) |
|
|
(3,966 |
) |
|
|
(2,603 |
) |
Facility Related adjustments |
|
|
- |
|
|
|
100 |
|
|
|
375 |
|
|
|
96 |
|
|
|
397 |
|
International sales reorganization charges |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(790 |
) |
|
|
- |
|
Provision for (proceeds from) litigation expenses and settlements |
|
|
30 |
|
|
|
- |
|
|
|
(135 |
) |
|
|
(105 |
) |
|
|
2,610 |
|
Restructuring and other costs, net |
|
|
395 |
|
|
|
(401 |
) |
|
|
(86 |
) |
|
|
(6 |
) |
|
|
79 |
|
Charge (proceeds) from non-marketable securities |
|
|
- |
|
|
|
(500 |
) |
|
|
500 |
|
|
|
(500 |
) |
|
|
500 |
|
Patent purchase agreement, net |
|
|
- |
|
|
|
4,000 |
|
|
|
- |
|
|
|
4,000 |
|
|
|
1,400 |
|
Non-GAAP Operating Expenses |
|
$ |
28,005 |
|
|
$ |
27,608 |
|
|
$ |
22,891 |
|
|
$ |
82,251 |
|
|
$ |
66,144 |
|
Cirrus Logic, Inc.
Thurman K. Case, 512-851-4125
Chief
Financial Officer
Investor.Relations@cirrus.com