( BW)(CA-PMC-SIERRA)(PMCS) PMC-Sierra, Inc. Reports Record Second Quarter Revenue and Net Income
Business Editors, High-Tech Writers
CAMPBELL, Calif.--(BUSINESS WIRE)--July 13, 2000--PMC-Sierra, Inc. (Nasdaq:PMCS) today reported record net revenue of $134.1 million and pro forma net income of $0.23 per share (diluted) for the second quarter of 2000.
Second quarter revenues of $134.1 million increased 30% sequentially and 124% compared to the second quarter of 1999. Second quarter pro forma net income of $39.0 million was 191% higher than in the same quarter of 1999. Pro forma net income per share (diluted) increased from $0.09 in the second quarter of 1999 to $0.23 in the quarter ended June 25, 2000.
Net revenues for the first six months of $236.9 million were 115% higher than in the first half of 1999 and resulted in pro forma net income per share (diluted) of $0.41 per share compared to $0.16 for the first six months of 1999.
Pro forma net income excludes acquisition expenses, amortization of goodwill and deferred stock compensation, and gains on sale of investments net of related tax provision. Net income including those items was $49.9 million ($.30 per share diluted) for the second quarter and $70.1 million ($.42 per share diluted) for the first half of 2000.
"PMC-Sierra is benefiting from secular growth driven by the broadband infrastructure build-out," stated Bob Bailey, Chairman and Chief Executive Officer. "The strength and momentum of our core businesses has afforded us the ability to acquire Malleable Technologies and to sign agreements to acquire Datum Telegraphic and Quantum Effect Devices (QEDI). We expect these enterprises to broaden our technical capabilities into voice processing, wireless infrastructure, and high performance microprocessing. All of these additions will enable PMC-Sierra to provide compelling and increasingly comprehensive architectural solutions."
About PMC-Sierra:
PMC-Sierra is a leading provider of broadband semiconductor solutions for the global information infrastructure. PMC-Sierra is traded on the Nasdaq National Market under the symbol PMCS. The company is included in the NASDAQ-100 INDEX (NDX) which contains the largest non-financial companies on the Nasdaq Stock Market. The Nasdaq-100 Index is the benchmark for the Nasdaq-100 Index Tracking Stock (AMEX:QQQ). Additional information on the Company can be found on line at pmc-sierra.com.
PMC-Sierra, Inc.
PRO FORMA STATEMENTS OF OPERATIONS
(in thousands, except for per share amounts)
(unaudited)
Three Months Ended
-----------------------------------
Jun 25,(1) Mar 26,(2) Jun 27,(3)
2000 2000 1999
Net revenues
Networking $ 127,170 $ 97,753 $ 55,082
Non-networking 6,938 5,054 4,805
--------- -------- --------
Total 134,108 102,807 59,887
Gross profit $
Networking 103,190 80,008 44,627
Non-networking 3,177 2,248 2,226
--------- -------- --------
Total 106,367 82,256 46,853
--------- -------- --------
Gross profit %
Networking 81.1% 81.8% 81.0%
Non-networking 45.8% 44.5% 46.3%
Total 79.3% 80.0% 78.2%
Other costs and expenses:
Research and development 32,655 26,795 15,902
Marketing, general and
administrative 19,995 15,131 10,043
--------- -------- --------
Pro forma income from operations 53,717 40,330 20,908
Interest and other income, net 3,646 3,620 1,134
--------- -------- --------
Income before provision for
income taxes 57,363 43,950 22,042
Provision for income taxes 18,355 14,516 8,639
--------- -------- --------
Pro forma net income $ 39,008 $ 29,434 $ 13,403
========= ======== ========
Pro forma diluted net income
per share $ 0.23 $ 0.17 $ 0.09
Shares used to calculate pro forma
diluted net income per share 169,002 168,222 152,791
Pro forma adjustments
The above pro forma amounts have been adjusted to eliminate the
following:
(1) $3.5 million amortization of deferred stock compensation, $0.5
million amortization of goodwill, $5.8 million costs of merger
related to the Extreme acquisition and $23.0 million gain on the
sale of investments net of the related tax provision of $2.3
million.
(2) $3.6 million amortization of deferred stock compensation, $0.5
million amortization of goodwill, $7.9 million costs of merger
related to the Toucan and AANetcom acquisitions, and $4.1 million
gain on the sale of investments net of the related tax provision
of $1.4 million.
(3) $0.9 million amortization of deferred stock compensation, $0.5
million amortization of goodwill and $26.8 million gain on the
sale of investments net of the related tax provision of $3.6
million.
(4) $7.2 million amortization of deferred stock compensation, $0.9
million amortization of goodwill, $13.7 million costs of merger
related to the Toucan, AANetcom and Extreme acquisitions and
$27.1 million gain on the sale of investments net of the related
tax provision of $3.7 million.
(5) $1.4 million amortization of deferred stock compensation, $1.0
million amortization of goodwill and $26.8 million gain on the
sale of investments net of the related tax provision of $3.6
million.
(a) The net income per share and number of shares used in the per
share calculation for all periods presented reflect the
two-for-one stock split that was effective February 2000.
(b) All items in both the 2000 and 1999 periods include the results
of Extreme which was acquired in the second quarter of 2000 in a
transaction accounted for as a pooling of interests.
PMC-Sierra, Inc.
PRO FORMA STATEMENTS OF OPERATIONS
(in thousands, except for per share amounts)
(unaudited)
Six Months Ended
---------------------------------
Jun 25,(4) Jun 27,(5)
2000 1999
Net revenues
Networking $ 224,923 $ 102,487
Non-networking 11,992 7,799
--------- ---------
Total 236,915 110,286
Gross profit $
Networking 183,198 82,694
Non-networking 5,425 3,638
--------- ---------
Total 188,623 86,332
--------- ---------
Gross profit %
Networking 81.4% 80.7%
Non-networking 45.2% 46.6%
Total 79.6% 78.3%
Other costs and expenses:
Research and development 59,450 29,705
Marketing, general and
administrative 35,126 19,677
--------- ---------
Pro forma income from
operations 94,047 36,950
Interest and other income, net 7,266 2,224
--------- ---------
Income before provision for
income taxes 101,313 39,174
Provision for income taxes 32,871 15,367
--------- ---------
Pro forma net income $ 68,442 $ 23,807
========= =========
Pro forma diluted net income
per share $ 0.41 $ 0.16
Shares used to calculate pro forma
diluted net income per share 168,612 151,315
Pro forma adjustments
The above pro forma amounts have been adjusted to eliminate the
following:
(1) $3.5 million amortization of deferred stock compensation, $0.5
million amortization of goodwill, $5.8 million costs of merger
related to the Extreme acquisition and $23.0 million gain on the
sale of investments net of the related tax provision of $2.3
million.
(2) $3.6 million amortization of deferred stock compensation, $0.5
million amortization of goodwill, $7.9 million costs of merger
related to the Toucan and AANetcom acquisitions, and $4.1 million
gain on the sale of investments net of the related tax provision
of $1.4 million.
(3) $0.9 million amortization of deferred stock compensation, $0.5
million amortization of goodwill and $26.8 million gain on the
sale of investments net of the related tax provision of $3.6
million.
(4) $7.2 million amortization of deferred stock compensation, $0.9
million amortization of goodwill, $13.7 million costs of merger
related to the Toucan, AANetcom and Extreme acquisitions and
$27.1 million gain on the sale of investments net of the related
tax provision of $3.7 million.
(5) $1.4 million amortization of deferred stock compensation, $1.0
million amortization of goodwill and $26.8 million gain on the
sale of investments net of the related tax provision of $3.6
million.
(a) The net income per share and number of shares used in the per
share calculation for all periods presented reflect the
two-for-one stock split that was effective February 2000.
(b) All items in both the 2000 and 1999 periods include the results
of Extreme which was acquired in the second quarter of 2000 in a
transaction accounted for as a pooling of interests.
PMC-Sierra, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share amounts)
(unaudited)
Three Months Ended
-----------------------------------
Jun 25, Mar 26, Jun 27,
2000 2000 1999
Net revenues
Networking $ 127,170 $ 97,753 $ 55,082
Non-networking 6,938 5,054 4,805
--------- -------- --------
Net revenues 134,108 102,807 59,887
Cost of revenues 27,741 20,551 13,034
--------- -------- --------
Gross profit 106,367 82,256 46,853
Other costs and expenses:
Research and development 32,655 26,795 15,902
Marketing, general
and administrative 19,995 15,131 10,043
Amortization of deferred
stock compensation:
Research and development 2,968 3,385 697
Marketing, general and
administrative 559 259 175
Amortization of goodwill 459 459 478
Costs of merger 5,776 7,902 -
--------- -------- --------
Income from operations 43,955 28,325 19,558
Interest and other income, net 3,646 3,620 1,134
Gain on sale of investments 22,992 4,117 26,800
--------- -------- --------
Income before provision
for income taxes 70,593 36,062 47,492
Provision for income taxes 20,655 15,916 12,261
--------- -------- --------
Net income $ 49,938 $ 20,146 $ 35,231
========= ======== ========
Net income per common
share - basic $ 0.33 $ 0.14 $ 0.25
========= ======== ========
Net income per common
share - diluted $ 0.30 $ 0.12 $ 0.23
========= ======== ========
Shares used in per share
calculation - basic 149,919 148,362 140,245
Shares used in per share
calculation - diluted 169,002 168,222 152,791
(1) The net income per share and number of shares used in the per
share calculation for all periods presented reflect the
two-for-one stock split that was effective February 2000.
(2) All items in both the 2000 and 1999 periods include the results
of Extreme Packet Devices which was acquired in the second
quarter of 2000 in a transaction accounted for as a pooling of
interests.
PMC-Sierra, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share amounts)
(unaudited)
Six Months Ended
-------------------------
Jun 25, Jun 27,
2000 1999
Net revenues
Networking $ 224,923 $ 102,487
Non-networking 11,992 7,799
--------- ---------
Net revenues 236,915 110,286
Cost of revenues 48,292 23,954
--------- ---------
Gross profit 188,623 86,332
Other costs and expenses:
Research and development 59,450 29,705
Marketing, general
and administrative 35,126 19,677
Amortization of deferred
stock compensation:
Research and development 6,353 1,155
Marketing, general and
administrative 818 228
Amortization of goodwill 918 956
Costs of merger 13,678 -
--------- ---------
Income from operations 72,280 34,611
Interest and other income, net 7,266 2,224
Gain on sale of investments 27,109 26,800
--------- ---------
Income before provision
for income taxes 106,655 63,635
Provision for income taxes 36,571 18,989
--------- ---------
Net income $ 70,084 $ 44,646
========= =========
Net income per common
share - basic $ 0.47 $ 0.32
========= ========
Net income per common
share - diluted $ 0.42 $ 0.30
========= ========
Shares used in per share
calculation - basic 149,141 139,462
Shares used in per share
calculation - diluted 168,612 151,315
(1) The net income per share and number of shares used in the per
share calculation for all periods presented reflect the
two-for-one stock split that was effective February 2000.
(2) All items in both the 2000 and 1999 periods include the results
of Extreme Packet Devices which was acquired in the second
quarter of 2000 in a transaction accounted for as a pooling of
interests.
PMC-Sierra, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
Jun 25, Dec 26,
2000 1999
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 126,073 $ 90,055
Short-term investments 123,844 106,636
Accounts receivable, net 64,614 36,170
Inventories, net 13,164 7,208
Deferred income taxes 9,270 9,270
Prepaid expenses and other
current assets 11,475 7,496
Short-term deposits for wafer
fabrication capacity - 4,637
--------- ---------
Total current assets 348,440 261,472
Property and equipment, net 72,804 48,766
Goodwill and other intangible
assets, net 13,433 15,280
Investments and other assets 13,993 11,827
Deposits for wafer fabrication capacity 23,001 14,483
--------- ---------
$ 471,671 $ 351,828
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 24,926 $ 11,973
Accrued liabilities 21,239 16,123
Deferred income 47,413 34,486
Accrued income taxes 22,265 25,912
Current portion of obligations under
capital leases and long-term debt 4,168 2,310
--------- ---------
Total current liabilities 120,011 90,804
Deferred income taxes 9,091 9,091
Noncurrent obligations under capital
leases and long-term debt 1,603 3,355
Special shares convertible into 4,016
(1999 - 4,242) common stock 6,653 6,998
Stockholders' equity 334,313 241,580
--------- ---------
$ 471,671 $ 351,828
========= =========
(1) All items in both the 2000 and 1999 periods include the results
of Extreme Packet Devices which was acquired in the second
quarter of 2000 in a transaction accounted for as a pooling of
interests.
--30--RYG/se*
CONTACT: PMC-Sierra Contacts --
John W. Sullivan, VP Finance & CFO
604/415-6145
Fax, 604/415-6240
Sullivan@pmc-sierra.com
or
Glen S. Kayll, Manager, Investor Relations
604/415-6144
Fax, 604/415-6240
Kayll@pmc-sierra.com
or
Susan Shaw, Manager, Public Relations
604, 415-6031
Fax, 604/415-6011
Sshaw@pmc-sierra.com
KEYWORD: CALIFORNIA
INDUSTRY KEYWORD: EARNINGS COMPUTERS/ELECTRONICS
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