not pretty
Alliance Semiconductor Reports Financial Results for the Fiscal Second Quarter Ended September 30, 2001
SANTA CLARA, Calif.--(BUSINESS WIRE)--Oct. 18, 2001--Alliance Semiconductor Corporation (Nasdaq:ALSC) today reported revenues for the second fiscal quarter ended September 30, 2001 of $5.1 million, a decrease of $59.4 million or 92% from the same quarter last year and a decrease of $7.0 million or 57% from the prior quarter's revenues of $12.1 million.
SRAM and DRAM sales for the quarter accounted for approximately 50% and 49% of revenues, respectively.
On September 12, 2001, the Company announced that it expected that second quarter revenues would be approximately 50% to 60% below the $12.0 million revenue reported during the first fiscal quarter ended June 30, 2001.
The net loss for the second fiscal quarter was $200.4 million, which resulted in a net loss of $4.85 per share compared to net income of $16.5 million, or $0.39 per share (diluted, net of tax), on revenues of $64.5 million during the same quarter last year.
The results for the fiscal second quarter include a pre-tax charge of approximately $290.6 million from the write-down of marketable securities and certain investments to market value as of September 30, 2001, as well as a $10.4 million write-down of inventory resulting from lower demand of the Company's products. A Pre-tax investment loss of $7.9 million reflected a gain of $25.5 million on the Company's investment in Platys Communications, Inc. resulting from Platys's acquisition by Adaptec, Inc. offset by investment losses on the sale of marketable securities and the accounting for certain hedged instruments under FAS133 totaling $33.4 million. Excluding the impairment charge for marketable securities and investment losses on the sale of marketable securities and hedged instruments and the inventory write-down, net income for the period would have been approximately $683 thousand, or $0.02 per share.
Alliance Chairman, President and CEO, N.D. Reddy said, "We have been through three tough sequential quarters, each down over 50%, since achieving $63.5 million in revenue in the December 2000 quarter. We have taken efforts to obtain optimum cost efficiency, without hindering research and development." Mr. Reddy continued, "In this second quarter, we took an impairment charge of $290.6 million for a substantial decline in the market price of our marketable securities, and a $10.4 million charge for the write-down in our inventories due to weak market demand. We believe that this will leave the necessary infrastructure in place to grow the Company when the recovery begins."
Mr. Reddy continued, "In the current market environment, it's difficult to predict the future demand. Based on some recent orders, we are hopeful that the December quarter revenues will improve over the prior quarter, and that revenue growth may continue to accelerate from the December quarter onward into next year."
Mr. Reddy explained, "Despite uncertain market conditions, Alliance has remained focused on the development of our next generation, high-density, high-performance synchronous and asynchronous SRAMs, and our Intelliwatt(TM) high-density SRAMs for wireless applications, each using leading-edge 0.15 um and 0.13 um technologies."
Mr. Reddy commented, "During the last quarter, the Company evaluated various market segments, and is currently evaluating a number of companies for potential acquisition."
On September 28, 2001, the Company announced a number of cost cutting measures to reduce expenses, including salary reductions of 5% to 15% for employees, starting October 1, 2001. Mr. Reddy explained, "In light of the recent reorganization of certain of the Company's operations, we have decided that the planned salary reduction of 5% for employees earning under $100,000 per year was not necessary at this time. However, the 10% and 15% salary reductions were implemented as announced."
Alliance Ventures LP Investments
The Company, through its venture arm, Alliance Venture Management, LLC, invested approximately $2.3 million during the fiscal second quarter in Alliance ventures funds (Alliance Ventures IV, LP and Alliance Ventures V, LP).
The Company is currently evaluating a number of existing and start-up investment opportunities, which could result in additional investments of $5 million to $8 million during the fiscal third and fourth quarters of fiscal year 2002. |
