7/20....ALSC..Semiconductor Reports Financial Results for the Fiscal First Quarter Ended July 1, 2000
Q1 Revenues Up 168% and Net Income of $26.8 Million Operating Income of $9.4 Million/$0.13 Per Share
SANTA CLARA, California--(BUSINESS WIRE)--July 20, 2000-- Alliance Semiconductor Corporation (Nasdaq:ALSC - news) today reported revenues for the fiscal first quarter ended July 1, 2000 of $47.4 million, an increase of 168% from the same quarter last year, and up 65% from the prior quarter's revenue of $28.8 million. SRAM and DRAM sales for the quarter accounted for approximately 44% and 56% of revenues, respectively.
Net income for the fiscal first quarter was $26.8 million, resulting in net earnings of $0.63 per share (diluted, net of tax), compared to a net income of $53.4 million, or $1.27 per share (diluted, net of tax), on revenues of $17.7 million during the same quarter last year.
Net income for the fiscal first quarter includes gains on the sale of marketable securities of $36.5 million, or $0.51 per share (diluted, net of tax), while net income for the fiscal first quarter last year, included a gain of $51.6 million, or $1.22 per share (diluted, net of tax), related to the conversion of its shares in Maverick Networks, Inc. to Broadcom Corporation.
The operating profit for the fiscal first quarter ended July 1, 2000 was $9.4 million, or $0.13 per share (diluted, net of tax), compared to an operating loss of $0.7 million, or $0.02 loss per share, for the same period last year, and an operating profit of $3.4 million, or $0.05 per share (diluted, net of tax), in the fiscal fourth quarter.
Alliance Chairman, President and CEO N.D. Reddy said, ``We had another excellent quarter as the demand for memory products remains robust. While pricing remains stable, booking activity also remains strong, with scheduled backlog through the balance of this calendar year in excess of $100 million.'' Reddy continued, ``Based on the strong backlog and customer base, which is spread across various market segments and geographic regions, we believe sales for the fiscal year may be over $200 million, which would be more than double our sales in fiscal year 2000.''
Reddy also said, ``During the fiscal first quarter, Alliance successfully ramped into production communication centric advanced 0.25um high speed and low power SRAM technology, introduced a 4Mb high speed asynchronous SRAM, a 4Mb synchronous SRAM, and a 4Mb low power Intelliwatt(tm) SRAM (for wireless applications). Additionally, we successfully transferred a 0.25um 16Mb DRAM and a 0.21um 64Mb SDRAM into production during the same period. During the balance of calendar year 2000, the Company is also planning to introduce the next generation of 0.18um SRAMs and DRAMs, and ramp-up production of 4Mb and 8Mb flash memory products. With the introduction of these new products, coupled with the current backlog and booking activity, the Company hopes for strong revenue and operating income growth during the fiscal second quarter 2001 and beyond.''
Communication Products Division Formed
Reddy also commented, ``On July 17, 2000, Alliance announced plans to form a Communication Products Division, whose focus will be addressing the explosive demands of the networking equipment market for advanced semiconductor solutions. The solutions we are planning to provide should enable the accelerated development and deployment of leading-edge products ranging from network access equipment to routers and switches to high speed optical transmission.''
Phil Thomas, who recently joined Alliance from Hitachi Semiconductor (America), Inc., was named as vice president and general manager of this new division. Reddy said, ``We are very excited to have Phil join Alliance. He brings over 20 years of engineering and marketing experience in the networking and telecommunications systems areas to Alliance, including senior level management positions at Hitachi Semiconductor, Cisco Systems and AT&T.''
Alliance Ventures LP Investments
The Company, through its venture arm, Alliance Venture Management, LLC, invested approximately $16.3 million during fiscal the first quarter in two Alliance ventures funds (Alliance Ventures II, LP and Alliance Ventures III, LP). At the end of June, Alliance Venture Management, LLC had invested approximately $44.4 million in 26 networking, communication and Internet start-up companies.
The Company is currently evaluating a number of existing and start-up investment opportunities which could result in additional investments of $15 million to $25 million during the fiscal second quarter of FY 2001.
Company Information
Alliance Semiconductor Corporation is a leading worldwide supplier of high performance memory and memory intensive logic products. Alliance's product lines include Static Random Access Memory (SRAM), Dynamic Random Access Memory (DRAM), Flash memory and embedded memory and logic products.
Alliance designs, develops and markets its products to the computing, networking, telecommunication, instrumentation, and consumer markets. Alliance manufactures its products through independent manufacturing facilities, using advanced CMOS process technologies with line widths as narrow as 0.21um.
The Company, through its venture arm Alliance Venture Management, LLC, invests in three venture funds. Alliance Ventures I, LP focuses on investing in networking and communication start-up companies, Alliance Ventures II, LP focuses on investing in Internet start-up ventures, and Alliance Ventures III, LP, focuses on emerging companies in the networking and communication market areas.
Alliance was founded in 1985. Additional Company information can be found on its home page: alsc.com.
Forward-Looking Statements
Except for historical information, the above statements of this press release (including, without limitation, expressions of expectation, belief, anticipation or estimation of the Company or its management) are forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in the forward looking statements. These risks and uncertainties include such factors, among others, as the potential for price erosion of the Company's products; cancellation of orders in the Company's backlog; decreased demand or increased competitive environment for the Company's products, including, without limitation, changes in the status of the SRAM, DRAM, flash, communications and embedded memory and logic markets and the demand for the Company's SRAM, DRAM, flash, communications and embedded memory and logic products; inability of the Company to obtain necessary capacity, timely delivery or acceptable yields from the entities that provide wafer fabrication, wafer sort, assembly and/or test services to the Company; increases in prices such entities charge the Company for wafer fabrication, wafer sort, assembly and/or test services; obsolescence of the Company's products; accumulation of excess inventory or price erosion or obsolescence of existing inventory, any of which may result in charges against the Company's earnings; inability to timely ramp up production of and deliver new or enhanced SRAM, DRAM products; inability to successfully develop and introduce flash or communications and embedded memory and logic products; inability to successfully recruit and retain qualified technical and other personnel; the ability of the Company to successfully enter the communications product market, which is different from the Company's core market of semiconductor memory; adverse developments in current or future litigation or administrative proceedings, including; as well as liquidation of antidumping duties imposed on the Company's importation of Taiwan-manufactured SRAMs; changes in stock price of Vitesse Semiconductor Corporation, PMC-Sierra, Inc., Broadcom Corporation, Chartered Semiconductor and UMC; adverse changes in value of investments made by Alliance Venture Management, LLC; the Company's potential status as an Investment Act of 1940 reporting company; and the risk factors listed under Item 1: Business and Item 7: Management's Discussion and Analysis of Financial Condition and Results of Operations in the Company's Form 10-K for the fiscal year ended April 1, 2000 which has been filed with the Securities and Exchange Commission, which is available through the Company's home page, alsc.com. These forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or to reflect any change in events, conditions or circumstances on which any such forward-looking statement is based, in whole or in part.
ALLIANCE SEMICONDUCTOR CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per-share data)
(unaudited)
Three Months Ended
June 30,
2000 1999
Net revenues $ 47,404 $ 17,711
Cost of revenues 29,883 12,470
Gross profit 17,521 5,241
Operating expenses:
Research and development 3,591 3,206
Selling, general and administrative 4,514 2,745
8,105 5,951
Profit (loss) from operations 9,416 (710)
Gain on investments 36,554 51,606
Other income, net 340 121
Profit before income taxes and
equity in income (loss) of investees 46,310 51,017
Provision (benefit) for income taxes 18,848 (819)
Profit before equity in income
(loss) of investees 27,462 51,836
Equity in income (loss) of investees (698) 1,532
Net income $ 26,764 $ 53,368
Net income per share:
Basic $ 0.64 $ 1.28
Diluted $ 0.63 $ 1.27
Weighted average number of common shares:
Basic 41,543 41,608
Diluted 42,778 42,149
ALLIANCE SEMICONDUCTOR CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except per-share data)
(unaudited)
June 30, March 31,
2000 2000
ASSETS
Current assets:
Cash and cash equivalents $ 44,888 $ 37,574
Short term investments 735,055 883,300
Accounts receivable, net 26,660 15,858
Inventory 50,520 37,439
Other current assets 3,634 3,736
Total current assets 860,757 977,907
Property and equipment, net 10,464 9,990
Investment in United
Microelectronics Corp. 505,478 505,478
(excluding short term portion)
Alliance Ventures
LP investments 41,819 26,646
Other assets 349 421
Total assets $ 1,418,867 $ 1,520,442
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 34,574 $ 27,133
Accrued liabilities 8,624 10,388
Income taxes payable 13,266 6,641
Deferred income taxes 261,471 316,903
Current portion of
long term obligations 1,017 905
Total current liabilities 318,952 361,970
Long term liabilities:
Long term obligations 2,716 2,714
Deferred income taxes 191,803 191,803
Total liabilities 513,471 556,487
Stockholders' equity:
Common stock 425 424
Additional paid-in capital 194,019 193,260
Treasury Stock (17,787) (12,468)
Retained earnings 671,359 644,595
Accumulated other
comprehensive income 57,380 138,144
Total stockholders' equity 905,396 963,955
$ 1,418,867 $ 1,520,442
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Contact:
Alliance Semiconductor
David Eichler, 408/855-4960
deichler@alsc.com
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