IDT Announces Results for First Quarter of Fiscal 2003
Company Posts 6 Percent Sequential Increase in Revenues
SANTA CLARA, Calif.--(BUSINESS WIRE)--July 18, 2002--IDT (Integrated Device Technology, Inc.) (Nasdaq:IDTI - News), a leading communications IC company, today announced results for the quarter ended June 30, 2002, the first quarter of fiscal 2003. Revenues for the first quarter were $91.8 million, an increase of 6 percent compared to the fourth quarter of fiscal 2002 and a decrease of 20.8 percent from the quarter ended July 1, 2001. On a pro-forma basis, the net loss for the first fiscal quarter was $3.5 million ($0.03 per diluted share), compared to a net loss of $6.6 million in the fourth quarter of 2002 and net income of $0.1 million ($0.00 per diluted share) for the quarter one year ago.
Including certain costs, charges and gains in accordance with GAAP, the Company lost $7.6 million in the first quarter of fiscal 2003 ($0.07 per diluted share) compared to a loss of $20.0 million in the fourth quarter ($0.19 per diluted share). One year ago, on a GAAP basis, the Company recorded a net loss of $21.5 million ($0.20 per diluted share) for the first quarter of fiscal 2002. Further information, including a detailed reconciliation of pro-forma and GAAP results, is provided in the financial tables of this release.
During the first quarter of fiscal 2003, IDT completed the transfer of manufacturing volumes from its Salinas, Calif., wafer fab to Hillsboro, Ore. The Company expects the completion of this transfer will contribute to net savings of approximately $5 million in manufacturing expenses per quarter beginning in the second quarter of fiscal 2003 and should enhance the Company's opportunity for profitability and cash flow in the second half of calendar 2002 and thereafter.
"Our business continued to grow during the first fiscal quarter, led by sales of new products including IP co-processors and integrated communications processors for enterprise networking applications," said Jerry Taylor, IDT's chief executive officer. "As we enter the summer quarter, growth rates in the markets we serve continue to be uncertain, but we remain optimistic that our key customers will resume their growth as the global economy recovers, resulting in increased demand for IDT's products."
Q1FY03 Highlights:
"This quarter represented another strong growth quarter for IP co-processors," said Greg Lang, IDT's president. "IDT is building momentum in product execution and design-win activity. We began general sampling of our 128Kx72-entry (9-Mbit) device, the industry's widest and fastest IP co-processor currently available. We shipped this product for revenue during fiscal Q1, making IDT the first company to ship a 9-Mbit device at 0.13-micron technology. This is an important milestone in the development of our commercial portfolio of co-processor products as we continue our leadership in this emerging market."
Additional Highlights:
IDT's RC32332 integrated communications processor earned another design win in 3Com Corporation's recently announced new stackable, layer-2 managed 10/100 Ethernet switches. IDT processors now power managed layer-2 switches from the top three system vendors - Cisco, 3Com, and HP - among others.
IDT expanded its industry-leading multi-port product portfolio with speed enhancements to its family of bank-switchable dual-ports. With speeds to 200 MHz and up to 9 Mbits of data storage, these dual-ports provide the highest performance and density on the market.
IDT introduced a family of WAN PLL products with single or dual reference clocks that provide timing and synchronization signals to interface circuits in T1/E1 applications. IDT's WAN PLLs utilize industry-compliant clock generators and are used for TDM clock and framing control in customer premises equipment, access, or carrier-equipment systems that have WAN links and/or DSP resources.
IDT introduced the industry's first family of zero delay buffers capable of user-selectable 2.5- and 3.3-volt outputs, allowing designers increased flexibility to integrate multiple voltage inputs on a single board.
IDT partnered with MontaVista(TM) Software to bring the power of MontaVista's embedded Linux® Professional Edition to IDT's family of integrated communications processors. MontaVista's Linux products strengthen IDT's growing leadership in a variety of communications applications.
Investor Information
Investors can listen to a live or on-demand replay Webcast of IDT's quarterly financial conference call at www.idt.com. A taped replay of the Company's quarter-end conference call will also be available by calling (800) 475-6701 (pass code is 644491) beginning at 5 p.m. PDT on July 18, 2002 and will be accessible until 9 p.m. PDT on July 25, 2002.
IDT stock is traded on the Nasdaq Stock Market® under the symbol "IDTI." The Company is included in the S&P 1000, which is a combination of the S&P MidCap 400 and S&P SmallCap 600 Indices, as well as the Nasdaq-100 Index® (NDX), which includes the largest non-financial companies on the Nasdaq Stock Market. Additional information about IDT is easily accessible at www.idt.com or on CD-ROM by calling (800) 345-7015. The investor hotline is (408) 654-6420.
About IDT
IDT enhances the global network with semiconductor solutions for communications companies that lead innovation and drive convergence in voice, data and wireless networks. IDT is focused on enhancing system bandwidth with communications-specific products including integrated communications processors, IP co-processors and telecom products. The portfolio is also comprised of key support products optimized for communications applications, including the industry's broadest selection of FIFOs, multi-ports, and clock management products. In addition, the product mix includes high-performance digital logic and high-speed SRAMs to meet the requirements of leading communications companies.
Headquartered in Santa Clara, Calif., the Company employs approximately 3,500 people worldwide and has a wafer manufacturing facility in Oregon, and test and assembly facilities in the Philippines and Malaysia. Forward-looking statements in this release involve a number of risks and uncertainties including, but not limited to, product demand, manufacturing capacity and costs, competition, pricing, patent and other intellectual property rights of third parties, timely development and supply of new products and manufacturing processes, availability of capital, cash flow and other risk factors detailed in the Company's Securities and Exchange Commission filings. Actual results may differ materially from the Company's projections.
Note to Editors: Linux is a registered trademark of Linus Torvalds. MontaVista is a trademark of MontaVista Software Inc. All brands or products are the trademarks or registered trademarks of their respective owners. IDT disclaims any proprietary interest in the trademarks of others.
INTEGRATED DEVICE TECHNOLOGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per-share data)
Three Months Ended
----------------------------------------------------------------------
Jun. 30, Mar. 31, Jul. 1,
2002 2002 2001
-----------------------------------
Revenues $ 91,812 $ 86,621 $ 115,908
Cost of revenues 57,003 56,163 71,933
Restructuring charges, asset
impairment and other -- 3,870 2,301
--------- --------- ---------
Gross profit 34,809 26,588 41,674
--------- --------- ---------
Operating expenses:
Research and development 30,241 31,962 33,073
Selling, general and
administrative 20,426 18,707 23,968
Acquired in-process research
and development -- -- 16,000
Amortization of intangibles 156 1,681 1,681
--------- --------- ---------
Total operating expenses 50,823 52,350 74,722
--------- --------- ---------
Operating loss (16,014) (25,762) (33,048)
Interest expense (131) (203) (655)
Interest income and other, net 5,923 6,459 11,729
--------- --------- ---------
Loss before income taxes (10,222) (19,506) (21,974)
Provision (benefit) for
income taxes (2,632) 474 (485)
--------- --------- ---------
Net loss $ (7,590) $ (19,980) $ (21,489)
========= ========= =========
Net income (loss) per share:
Basic $ (0.07) $ (0.19) $ (0.20)
Diluted $ (0.07) $ (0.19) $ (0.20)
Weighted average shares:
Basic 104,232 104,351 104,944
Diluted 104,232 104,351 104,944
INTEGRATED DEVICE TECHNOLOGY, INC.
PRO FORMA ADJUSTMENTS
(Unaudited)
(In thousands)
Three Months Ended
-----------------------------------
Jun. 30, Mar. 31, Jul. 1,
2002 2002 2001
--------- --------- ---------
Net loss $ (7,590) $ (19,980) $ (21,489)
--------- --------- ---------
Special items:
Cost of goods sold:
Restructuring charges (1) -- (3,870) (2,301)
Other (3) (3,637) (3,127) --
Amortization of acquisition-
related charges (2) (786) (786) (786)
Operating expenses:
Acquired IPR&D (2) -- -- (16,000)
Other (3) (478) (76) --
Restructuring charges (1) -- (172) (215)
Amortization of goodwill (2) -- (1,500) (1,500)
Other acquisition-
related costs (2) (976) (1,752) (1,263)
Tax effects 1,763 (2,118) 503
--------- --------- ---------
Total special items (4,114) (13,401) (21,562)
--------- --------- ---------
Pro forma net income (loss) $ (3,476) $ (6,579) $ 73
========= ========= =========
(1) Represents costs, primarily severance, of restructuring actions
taken in Q1 and Q4 2002.
(2) Costs relate to our Newave acquisition in April 2001 and include
an IPR&D charge, contingent compensation, stock-based compensation
amortization and amortization of intangible assets. In accordance
with SFAS 142, goodwill was not amortized beginning in fiscal
2003.
(3) Represents costs associated with the closure of our Salinas plant,
primarily $2.9 million and $3.0 million in retention bonuses for
Q4 2002 and Q1 2003, respectively.
INTEGRATED DEVICE TECHNOLOGY, INC.
PRO FORMA STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per-share data)
Three Months Ended
-----------------------------------
Jun. 30, Mar. 31, Jul. 1,
2002 2002 2001
--------- --------- ---------
Revenues $ 91,812 $ 86,621 $ 115,908
Cost of revenues 52,580 52,250 71,147
--------- --------- ---------
Gross profit 39,232 34,371 44,761
--------- --------- ---------
Operating expenses:
Research and development 29,161 30,143 31,923
Selling, general and
administrative 20,208 18,707 23,821
--------- --------- ---------
Total operating expenses 49,369 48,850 55,744
--------- --------- ---------
Operating loss (10,137) (14,479) (10,983)
Interest expense (131) (203) (655)
Interest income and other, net 5,923 6,459 11,729
--------- --------- ---------
Income (loss) before income
taxes (4,345) (8,223) 91
Provision (benefit) for income
taxes (869) (1,644) 18
--------- --------- ---------
Net income (loss) $ (3,476) $ (6,579) $ 73
========= ========= =========
Net income (loss) per share:
Diluted $ (0.03) $ (0.06) $ 0.00
Weighted average shares:
Diluted 104,232 104,351 108,954
Our pro forma results exclude acquisition-related charges and unusual
or infrequent expenses and benefits that are not directly related to
our ongoing operations. We believe that these pro forma results
provide useful information; however, our presentation of pro forma
results is not in accordance with GAAP and may not be comparable to
pro forma information provided by other companies. Pro forma
information should be considered a supplement to, and not a substitute
for, financial statements prepared in accordance with GAAP.
INTEGRATED DEVICE TECHNOLOGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
Jun. 30, Mar. 31,
(In thousands) 2002 2002
----------------------------------------------------------------------
ASSETS
Current assets:
Cash and cash equivalents $ 240,836 $ 256,172
Short-term investments 376,657 418,228
Restricted investments 50,558 --
Accounts receivable, net 36,362 40,067
Inventories 78,351 78,247
Deferred tax assets 75,380 74,874
Prepayments and other current assets 23,428 19,787
----------- -----------
Total current assets 881,572 887,375
Property, plant and equipment, net 204,276 221,499
Goodwill and other intangibles 56,339 57,281
Other assets 39,574 59,664
----------- -----------
TOTAL ASSETS $ 1,181,761 $ 1,225,819
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 17,871 $ 18,342
Accrued compensation and
related expenses 16,374 14,068
Deferred income on shipments
to distributors 29,494 36,443
Income taxes payable 18,897 21,863
Other accrued liabilities 28,051 29,173
----------- -----------
Total current liabilities 110,687 119,889
Other liabilities 49,446 51,221
----------- -----------
Total liabilities 160,133 171,110
Stockholders' equity 1,021,628 1,054,709
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 1,181,761 $ 1,225,819
=========== ===========
--------------------------------------------------------------------------------
Contact:
IDT
Corporate Communications
Diana Pailthorpe, 408/492-8210
E-mail: diana.pailthorpe@idt.com
Investor Relations, 408/654-6420
E-mail: ir@idt.com |
