-
Third quarter net revenues of
$1.80 billion, up 5.5% sequentially and 1.9%
year-over-year
-
Q3 gross margin of 35.8%, up
190 basis points sequentially; up 100 basis points
year-over-year
-
Free cash flow(1) before
acquisition was $178 million in Q3; $256 million
year-to-date
Geneva, October 27, 2016 - STMicroelectronics
(NYSE: STM), a global semiconductor leader serving customers
across the spectrum of electronics applications, reported financial
results for the third quarter and nine months ended October 1,
2016.
Third quarter net revenues totaled $1.80 billion,
gross margin was 35.8%, and net earnings were $71 million or $0.08
per share.
"In the third quarter revenues
increased 5.5% sequentially and 1.9% year-over year. Revenue growth
also brought improved operating profitability, with a third quarter
operating margin before impairment and restructuring of 6.6%,"
commented Carlo Bozotti, STMicroelectronics President and Chief
Executive Officer.
"Sequential growth was driven by
the increasing pervasiveness of ST's products in flagship
smartphones, wearables and Internet of Things applications: from
MEMS and sensors, including our latest 6-axis gyroscope, to imaging
sensors, with new products based on our Time-of-Flight technology,
to our expanding STM32 family of microcontrollers. In addition, we
grew year-over-year in automotive and we continued to see positive
momentum in industrial, the distribution channel and the mass
market.
"In the quarter we completed the
acquisition of NFC and RFID reader assets, strengthening our
portfolio of secure microcontrollers for next-generation mobile and
Internet of Things devices, while also improving our cash balance
thanks to increased cash flow generated from operations."
U.S. GAAP
(Million US$) |
Q3 2016 |
Q2 2016 |
Q3 2015 |
Net
Revenues |
1,797 |
1,703 |
1,764 |
Gross
Margin |
35.8% |
33.9% |
34.8% |
Operating
Income (Loss) |
90 |
28 |
91 |
Net
Income (Loss) attributable to parent company |
71 |
23 |
90 |
Net cash
from operating activities |
330 |
191 |
225 |
Non-U.S.
GAAP(1)
(Million US$) |
Operating
Income (Loss) before impairment and restructuring charges |
119 |
40 |
102 |
Free cash
flow |
100 |
47 |
85 |
Net
financial position |
464 |
426 |
459 |
(1)
Non-U.S. GAAP measure. See Appendix for
reconciliation to U.S. GAAP and additional information explaining
why the Company believes these measures are important.
Quarterly Financial Summary by
Product Group
Product Group Data
(Million US$) |
Q3 2016
Revenues |
Q2 2016
Revenues |
Q3 2015
Revenues |
Automotive and Discrete Group (ADG) |
704 |
721 |
706 |
Analog
and MEMS Group (AMG) |
403 |
376 |
411 |
Microcontrollers and Digital ICs Group (MDG) |
587 |
556 |
590 |
Others
(a) |
103 |
50 |
57 |
Total |
1,797 |
1,703 |
1,764 |
(a)
Net revenues of "Others" includes revenues from
sales of Imaging Product Division, Subsystems, assembly services,
and other revenue.
Third Quarter Review
Third quarter net revenues increased 5.5%
sequentially, at the midpoint of the Company's guidance. Analog and
MEMS Group (AMG) revenues increased sequentially 7.1% driven by
motion MEMS and microphones. Microcontrollers and Digital ICs Group
(MDG) increased 5.5% on a sequential basis driven by general
purpose microcontrollers and digital ASICs for networking.
Automotive and Discrete Group (ADG) revenues decreased 2.3% on a
sequential basis due to seasonality in automotive products and
substantially flat revenues in power discretes. Specialized image
sensors, reported in Others, registered a very strong sequential
revenue growth due to new products, based on ST's Time-of-Flight
technology, ramping in wireless applications.
On a year-over-year basis, third quarter net
revenues increased 1.9%, or 3.4% excluding businesses undergoing a
phase-out (mobile legacy products, camera modules and set-top box).
Growth was driven by MEMS and sensors, microcontrollers,
automotive, specialized image sensors and digital ASICs partially
offset by analog and power discretes - both negatively impacted by
the weak computer peripheral market - and by the discontinued
product lines.
By region, Asia Pacific grew revenues sequentially
12.7% while the Americas and EMEA were lower by 0.1% and 5.4%,
respectively. On a year-over-year basis, Asia Pacific and EMEA grew
revenues 5.6% and 1.4%, respectively, while the Americas decreased
by 10.2%.
Third quarter gross profit was $643 million. Gross
margin was 35.8%, and included about 60 basis points of unused
capacity charges. On a sequential basis, gross margin increased 190
basis points due to improved manufacturing efficiency and product
mix, partially offset principally by normal price pressure and
higher unused capacity charges. Gross margin also improved on a
year-over-year basis, increasing 100 basis points on improved
manufacturing efficiency and favorable currency effects, net of
hedging, partially offset by normal price pressure.
Combined R&D and SG&A expenses were $542
million, decreasing by $23 million on a sequential basis,
benefiting from favorable seasonality and the set-top box
restructuring plan.
Third quarter other income and expenses, net,
registered income of $18 million compared to $28 million in the
prior quarter mainly due to lower R&D funding.
Impairment and restructuring charges in the third
quarter were $29 million compared to $12 million in the prior
quarter, both mostly related to the set-top box restructuring plan
announced in January 2016.
Third quarter operating income was $90 million
compared to $28 million and $91 million in the prior quarter and
year-ago quarter. In the third quarter, the Imaging Product
Division turned to profit. In addition, the Company continued to
make progress on its restructuring of the set-top box business
targeting annualized savings of $170 million upon completion.
Operating income before impairment and restructuring
charges(1) improved
sequentially to $119 million, or 6.6% of revenues, from $40
million, mainly due to higher revenues and higher gross profit as
well as lower operating expenses. On a year-over-year basis,
operating income before impairment and restructuring charges
improved by $17 million reflecting improved manufacturing
efficiencies, better product mix, lower operating expenses and
favorable currency effects, net of hedging, partially offset mainly
by a lower level of R&D grants.
Third quarter net income was $71 million,
equivalent to $0.08 per share, compared to net income of $23
million in the prior quarter and net income of $90 million in the
year-ago quarter which included an income tax benefit of $14
million related to the settlement of a tax assessment.
Nine Month Financial Summary by
Product Group
Product Group Data
(Million US$) |
Nine Months 2016 Net Revenues |
Nine Months 2015 Net Revenues |
Automotive and Discrete Group (ADG) |
2,096 |
2,094 |
Analog
and MEMS Group (AMG) |
1,148 |
1,301 |
Microcontrollers and Digital ICs Group (MDG) |
1,676 |
1,678 |
Others |
193 |
156 |
Total |
5,113 |
5,229 |
Nine Months 2016 Review
In total, net revenues in the nine months 2016
decreased 2.2% to $5.11 billion from $5.23 billion in the year-ago
period. Net revenues, excluding businesses undergoing a phase-out,
decreased 0.9% with strong growth in specialized image sensors and
solid growth in microcontrollers and automotive offset by analog
and power discrete, due to weakness in the computer peripheral
markets, and MEMS, due to weakness in smartphones earlier in the
year.
Gross margin in the nine months 2016 improved to
34.4% from 33.9% in the year-ago period mainly benefiting from
manufacturing efficiencies and favorable currency effects, net of
hedging, partially offset by price pressure.
Nine Month 2016 operating income was $85 million
compared to $84 million in the year-ago period. Operating income
before impairment and restructuring charges(1) was
$154 million, compared to $145 million in the year-ago period
reflecting improved manufacturing efficiencies, better product mix,
favorable currency effects, net of hedging, and lower operating
expenses partially offset mainly by price pressure and lower
R&D grants. ADG operating performance improved principally due
to mix improvements in comparison to the year-ago period. MDG
operating margin turned positive due to higher sales of general
purpose microcontrollers, lower sales of low margin set-top box
products and the savings from the set-top box restructuring plan.
AMG operating results decreased mainly due to lower sales.
Combined R&D and SG&A expenses decreased
3.5% to $1.68 billion compared to $1.74 billion in the year-ago
period mainly reflecting lower R&D costs due to favorable
currency effects, net of hedging, and the benefits of the set-top
box restructuring plan and the saving plan completed in 2015.
Other income and expenses, net, registered income
of $73 million compared to $110 million in the year-ago period
mainly due to a lower level of R&D grants.
On a year-to-date basis, impairment and
restructuring charges were $69 million compared to $61 million in
the year-ago period and principally related to the set-top box
restructuring plan.
Nine Month 2016 net income was $53 million,
equivalent to $0.06 per share, compared to net income of $102
million, which included a one-time $46 million income tax benefit,
or $0.12 per share in the year-ago period.
(1)Non-U.S.
GAAP measure. See Appendix for additional information and
reconciliation to U.S. GAAP.
Cash Flow and Balance Sheet
Highlights
Net cash from operating activities was $330
million and $662 million for the third quarter and nine months of
2016, respectively. Nine months 2015 net cash from operating
activities was $597 million.
Capital expenditure payments, net of proceeds from
sales, were $143 million and $379 million during the third quarter
and nine months of 2016, respectively. Nine Month 2015 capital
expenditures were $378 million.
After the cash outflow of $78 million for the
acquisition of NFC and RFID reader assets, free cash
flow(1) was $100
million and $178 million during the third quarter and nine months
of 2016, respectively. Nine months 2015 free cash flow was
$179 million.
Inventory was $1.24 billion at quarter end, down
2.2% from the prior quarter. Inventory in the third quarter of 2016
was at 3.7 turns or 97 days.
The Company paid cash dividends totaling $53
million and $197 million for the third quarter and year-to-date
period, respectively.
ST's total financial resources equaled $2.02
billion and total financial debt was $1.55 billion at October 1,
2016. ST's net financial position(1) was $464
million at October 1, 2016 compared to $426 million at July 2,
2016.
Total equity, including non-controlling interest,
was $4.65 billion at October 1, 2016.
(1)Non-U.S.
GAAP measure. See Appendix for additional information and
reconciliation to U.S. GAAP.
Fourth Quarter 2016 Business
Outlook
Mr. Bozotti commented, "Demand is
currently strong in the smartphone market and we continue to see
positive trends in automotive and industrial. In the fourth
quarter, we anticipate at the midpoint a sequential increase in net
revenues of about 3.2% and a gross margin of about
37.0%.
"Thanks to our strategic focus on
Smart Driving and Internet of Things, the increased traction we are
seeing with our new products and positive market trends, ST is
positioned to achieve year-over-year revenue growth for 2016 driven
by automotive, specialized image sensors and
microcontrollers.
"In addition, we expect for 2016
to improve our profitability and continue to generate solid free
cash flow. While we remain mindful of macroeconomic factors and
their potential impact on our customers and the semiconductor
market, we see less macro risk than we did earlier in the
year."
The Company expects fourth
quarter 2016 revenues to increase about 3.2% on a sequential basis,
plus or minus 3.5 percentage points. Gross margin in the fourth
quarter is expected to be about 37.0% plus or minus 2.0 percentage
points.
This outlook is based on an
assumed effective currency exchange rate of approximately $1.11 =
€1.00 for the 2016 fourth quarter and includes the impact of
existing hedging contracts. The fourth quarter will close on
December 31, 2016.
Recent Corporate
Developments
-
On July 29, ST announced that it had acquired
ams' assets related to its NFC and RFID- reader business. ST
acquired intellectual property, technologies, products and business
highly complementary to its secure microcontroller solutions
serving mobile devices, wearables, banking, identification,
industrial, automotive and IoT markets.
-
On August 23, ST announced that it had posted
its IFRS 2016 Semi Annual Accounts for the six-month period ended
July 2, 2016, on its website and filed them with the Netherlands
Authority for the Financial Markets.
Q3 2016 - Product and Technology
Highlights
Automotive and Discrete Group
(ADG)
- Launched strategic cooperation with European
Tier1 for a new generation of car-body applications using our 40nm
32-bit microcontrollers;
- Captured a win for our 40nm powertrain
microcontroller for an automatic transmission from a major European
Tier1;
- Continued expansion of market presence in
infotainment for Accordo STAR tuner families by earning an award
for a high-volume car radio with a major American OEM;
- Earned additional important wins for our audio
amplifiers for multiple telematics platforms for a European car
manufacturer;
- Landed significant business wins for
motor-control solutions for fuel pumps from an important European
Tier1;
- Registered multiple design wins for
high-temperature triacs and medium-power silicon-controller
rectifiers from market leaders in the appliance and automotive
sectors;
- Collected design wins with SiC diodes in both
automotive- and server-market applications in China
- Released the first free-of-charge simulator to
help designers quickly validate electrostatic-discharge (ESD)
protection and signal integrity;
- Won important business for IGBTs from European
appliance leaders for a washing-machine platform, air-conditioning
system, and for induction heating;
- Recorded important wins with low-voltage
trench-technology products from a top European Tier1 and from a
leading Asia-Pacific Tier1;
- Earned an important win for an injection driver
ASIC for engine management from a market leading Tier1;
- Captured a major award for a motor pre-driver and
power stage for a parking brake from a Chinese manufacturer.
Analog and MEMS Group
(AMG)
- Continued gaining traction for Bluetooth Low
Energy ICs in consumer applications and SPIRIT RF chips in
industrial applications.
- Earned multiple design wins in the mass market
for our STSPIN products, which were recognized as a Top 10 Power
Product of the Year in China by 21ic.com and EPC;
- Introduced an ultra-tiny, low-dropout regulator
in a breakthrough bumpless chip-scale package, which was named
Product of Month, by How2Power.com;
- Announced a high-voltage converter for
ultra-low-consumption power supplies in smart homes and industrial
applications;
- Demonstrated progress in Industry 4.0 with an
order from a top industrial customer for IO-Link;
- Landed important wins for high-precision chopper
amplifiers and nano-power op-amps with multiple Tier1 automotive
customers;
- Introduced high-efficiency wireless
battery-charging chipsets for smaller, simpler, sealed
wearables;
- Named MEMS Manufacturer of the Year at the MEMS
World Summit, in Shanghai.
Microcontrollers and Digital ICs
Group (MDG)
- Added new LoRa(TM) Kit to the STM32
Microcontroller Development Ecosystem;
- Certified STM32 cryptographic library according
to the US Cryptographic Algorithm Validation Program;
- Designed the STM32L4 into gas meters at key
European OEMs;
- Won socket for STM32F7 from a major Chinese OEM
in a smartwatch;
- Placed multiple STM32 series MCUs into motor
controls for industrial pumps at major European OEMs;
- Recognized with Smart Security Week Award for
STSAFE-A100 Authentication Secure Element;
- Qualified ST33J2M0, 3rd-generation
NFC Secure Element, in 40nm technology;
- Captured a socket for a ST25 dynamic tag in a
washing machine from a major appliance OEM;
- Earned a win for 16k EEPROM in a camera module
from a major Japanese OEM;
- Signed a deal for an Internet-over-satellite
application with a major European satellite operator;
- Won a socket from a major OEM in the European
Satellite eco-system;
- Achieved a milestone 1 millionth ASIC shipment to
a networking-equipment market leader;
- Continued strong momentum of Optical ICs,
exhibiting double-digit sequential growth.
Use of Supplemental Non-U.S. GAAP
Financial Information
This press release contains supplemental non-U.S.
GAAP financial information, including operating income (loss)
before impairment and restructuring charges, operating margin
before impairment and restructuring charges, adjusted net earnings
per share, free cash flow and net financial position.
Readers are cautioned that these measures are
unaudited and not prepared in accordance with U.S. GAAP and should
not be considered as a substitute for U.S. GAAP financial measures.
In addition, such non-U.S. GAAP financial measures may not be
comparable to similarly titled information from other
companies.
See the Appendix of this press release for a
reconciliation of the Company's non-U.S. GAAP financial measures to
their corresponding U.S. GAAP financial measures. To compensate for
these limitations, the supplemental non-U.S. GAAP financial
information should not be read in isolation, but only in
conjunction with the Company's consolidated financial statements
prepared in accordance with U.S. GAAP.
Forward-looking
information
Some of the statements contained
in this release that are not historical facts are statements of
future expectations and other forward-looking statements (within
the meaning of Section 27A of the Securities Act of 1933 or Section
21E of the Securities Exchange Act of 1934, each as amended) that
are based on management's current views and assumptions, and are
conditioned upon and also involve known and unknown risks and
uncertainties that could cause actual results, performance, or
events to differ materially from those anticipated by such
statements, due to, among other factors:
-
Uncertain macro-economic and
industry trends, which may impact end-market demand for our
products;
-
Customer demand that differs
from projections;
-
The ability to design,
manufacture and sell innovative products in a rapidly changing
technological environment;
-
Unanticipated events or
circumstances, which may impact our ability to execute the planned
reductions in our net operating expenses and / or meet the
objectives of our R&D Programs, which benefit from public
funding;
-
Changes in economic, social,
labor, political, or infrastructure conditions in the locations
where we, our customers, or our suppliers operate, including as a
result of macro-economic or regional events, military conflicts,
social unrest, labor actions, or terrorist activities;
-
The Brexit vote and the
perceptions as to the impact of the withdrawal of the U.K. may
adversely affect business activity, political stability and
economic conditions in the U.K., the Eurozone, the EU and
elsewhere. While we do not have material operations in the U.K. and
have not experienced any material impact from Brexit on our
underlying business to date, we cannot predict its future
implications;
-
Financial difficulties with any
of our major distributors or significant curtailment of purchases
by key customers;
-
The loading, product mix, and
manufacturing performance of our production facilities;
-
The functionalities and
performance of our IT systems, which support our critical
operational activities including manufacturing, finance and sales,
and any breaches of our IT systems or those of our customers or
suppliers;
-
Variations in the foreign
exchange markets and, more particularly, the U.S. dollar exchange
rate as compared to the Euro and the other major currencies we use
for our operations;
-
The impact of intellectual
property ("IP") claims by our competitors or other third parties,
and our ability to obtain required licenses on reasonable terms and
conditions;
-
The ability to successfully
restructure underperforming business lines and associated
restructuring charges and cost savings that differ in amount or
timing from our estimates;
-
Changes in our overall tax
position as a result of changes in tax laws, the outcome of tax
audits or changes in international tax treaties which may impact
our results of operations as well as our ability to accurately
estimate tax credits, benefits, deductions and provisions and to
realize deferred tax assets;
-
The outcome of ongoing
litigation as well as the impact of any new litigation to which we
may become a defendant;
-
Product liability or warranty
claims, claims based on epidemic or delivery failure, or other
claims relating to our products, or recalls by our customers
for products containing our parts;
-
Natural events such as severe
weather, earthquakes, tsunamis, volcano eruptions or other acts of
nature, health risks and epidemics in locations where we, our
customers or our suppliers operate;
-
Availability and costs of raw
materials, utilities, third-party manufacturing services and
technology, or other supplies required by our operations.
Such forward-looking statements
are subject to various risks and uncertainties, which may cause
actual results and performance of our business to differ materially
and adversely from the forward-looking statements. Certain
forward-looking statements can be identified by the use of forward
looking terminology, such as "believes," "expects," "may," "are
expected to," "should," "would be," "seeks" or "anticipates" or
similar expressions or the negative thereof or other variations
thereof or comparable terminology, or by discussions of strategy,
plans or intentions.
Some of these risk factors are
set forth and are discussed in more detail in "Item 3. Key
Information - Risk Factors" included in our Annual Report on Form
20-F for the year ended December 31, 2015, as filed with the SEC on
March 16, 2016. Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described in this
release as anticipated, believed, or expected. We do not intend,
and do not assume any obligation, to update any industry
information or forward-looking statements set forth in this release
to reflect subsequent events or circumstances.
STMicroelectronics Conference
Call and Webcast Information
On October 27, 2016, the management of
STMicroelectronics will conduct a conference call to discuss the
Company's operating performance for the third quarter of 2016.
The conference call will be held at 9:30 a.m. CET
/ 8:30 a.m. BST / 3:30 a.m. U.S. Eastern Time (ET) / 12:30 a.m.
U.S. Pacific Time (PT). The conference call will be available live
via the Internet by accessing http://investors.st.com. Those
accessing the webcast should go to the Web site at least 15 minutes
prior to the call, in order to register, download and install any
necessary audio software. The webcast replay will be available
until November 11, 2016.
About
STMicroelectronics
ST is a global semiconductor leader delivering intelligent and
energy-efficient products and solutions that power the electronics
at the heart of everyday life. ST's products are found everywhere
today, and together with our customers, we are enabling smarter
driving and smarter factories, cities and homes, along with the
next generation of mobile and Internet of Things devices. By
getting more from technology to get more from life, ST stands for
life.augmented.
In 2015, the Company's net revenues were $6.90
billion, serving more than 100,000 customers worldwide. Further
information can be found at www.st.com
For further information, please
contact:
INVESTOR RELATIONS:
Tait
Sorensen
Group VP, Investor Relations
STMicroelectronics
Tel: +1 602 485 2064
tait.sorensen@st.com
MEDIA RELATIONS:
Nelly
Dimey
Director, Corporate Media and Public Relations
Tel: + 33 1 58 07 77 85
nelly.dimey@st.com
STMicroelectronics N.V. |
|
|
Consolidated Statements of Income |
|
|
(in millions of U.S. dollars, except per
share data ($)) |
|
|
|
|
|
|
Three Months Ended |
|
(Unaudited) |
(Unaudited) |
|
October 01, |
September 26, |
|
2016 |
2015 |
|
|
|
Net sales |
1,794 |
1,755 |
Other revenues |
3 |
9 |
NET REVENUES |
1,797 |
1,764 |
Cost of sales |
(1,154) |
(1,151) |
GROSS PROFIT |
643 |
613 |
Selling, general and administrative |
(224) |
(218) |
Research and development |
(318) |
(331) |
Other income and expenses, net |
18 |
38 |
Impairment, restructuring charges and other related closure
costs |
(29) |
(11) |
Total Operating Expenses |
(553) |
(522) |
OPERATING INCOME |
90 |
91 |
Interest expense, net |
(5) |
(5) |
Income (loss) on equity-method investments |
(1) |
(1) |
INCOME BEFORE INCOME TAXES |
84 |
85 |
AND NONCONTROLLING INTEREST |
|
|
Income tax benefit (expense) |
(12) |
8 |
NET INCOME |
72 |
93 |
Net loss (income) attributable to noncontrolling
interest |
(1) |
(3) |
NET INCOME ATTRIBUTABLE TO PARENT
COMPANY |
71 |
90 |
|
|
|
EARNINGS PER SHARE (BASIC)
ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS |
0.08 |
0.10 |
EARNINGS PER SHARE (DILUTED)
ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS |
0.08 |
0.10 |
|
|
|
NUMBER OF WEIGHTED AVERAGE |
|
|
SHARES USED IN CALCULATING |
|
|
DILUTED EARNINGS PER SHARE |
886.7 |
880.7 |
STMicroelectronics N.V. |
|
|
Consolidated Statements of Income |
|
|
(in millions of U.S. dollars, except per
share data ($)) |
|
|
|
|
|
|
Nine Months Ended |
|
(Unaudited) |
(Unaudited) |
|
October 01, |
September 26, |
|
2016 |
2015 |
|
|
|
Net sales |
5,097 |
5,202 |
Other revenues |
16 |
27 |
NET REVENUES |
5,113 |
5,229 |
Cost of sales |
(3,355) |
(3,455) |
GROSS PROFIT |
1,758 |
1,774 |
Selling, general and administrative |
(681) |
(666) |
Research and development |
(996) |
(1,073) |
Other income and expenses, net |
73 |
110 |
Impairment, restructuring charges and other related closure
costs |
(69) |
(61) |
Total Operating Expenses |
(1,673) |
(1,690) |
OPERATING INCOME |
85 |
84 |
Interest expense, net |
(15) |
(16) |
Income (loss) on equity-method investments |
8 |
1 |
INCOME BEFORE INCOME TAXES |
78 |
69 |
AND NONCONTROLLING INTEREST |
|
|
Income tax benefit (expense) |
(21) |
38 |
NET INCOME |
57 |
107 |
Net loss (income) attributable to noncontrolling
interest |
(4) |
(5) |
NET INCOME ATTRIBUTABLE TO PARENT
COMPANY |
53 |
102 |
|
|
|
EARNINGS PER SHARE (BASIC)
ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS |
0.06 |
0.12 |
EARNINGS PER SHARE (DILUTED)
ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS |
0.06 |
0.12 |
|
|
|
NUMBER OF WEIGHTED AVERAGE |
|
|
SHARES USED IN CALCULATING |
|
|
DILUTED EARNINGS PER SHARE |
885.4 |
880.0 |
STMicroelectronics N.V. |
|
|
|
CONSOLIDATED BALANCE SHEETS |
|
|
|
As at |
October 01, |
July 02, |
December 31, |
In millions of U.S. dollars |
2016 |
2016 |
2015 |
|
(Unaudited) |
(Unaudited) |
(Audited) |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
1,675 |
1,682 |
1,771 |
Restricted cash |
- |
- |
4 |
Marketable securities |
342 |
345 |
335 |
Trade accounts receivable, net |
1,009 |
886 |
820 |
Inventories |
1,238 |
1,266 |
1,251 |
Deferred tax assets |
83 |
78 |
91 |
Assets held for sale |
1 |
- |
1 |
Other current assets |
377 |
424 |
407 |
Total current assets |
4,725 |
4,681 |
4,680 |
Goodwill |
119 |
77 |
76 |
Other intangible assets, net |
199 |
153 |
166 |
Property, plant and equipment, net |
2,289 |
2,290 |
2,321 |
Non-current deferred tax assets |
465 |
465 |
436 |
Long-term investments |
57 |
57 |
57 |
Other non-current assets |
424 |
394 |
459 |
|
3,553 |
3,436 |
3,515 |
Total assets |
8,278 |
8,117 |
8,195 |
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current liabilities: |
|
|
|
Short-term debt |
117 |
171 |
191 |
Trade accounts payable |
674 |
597 |
525 |
Other payables and accrued liabilities |
728 |
654 |
703 |
Dividends payable to stockholders |
112 |
165 |
97 |
Deferred tax liabilities |
- |
1 |
2 |
Accrued income tax |
45 |
29 |
42 |
Total current liabilities |
1,676 |
1,617 |
1,560 |
Long-term debt |
1,436 |
1,430 |
1,421 |
Post-employment benefit obligations |
362 |
359 |
351 |
Long-term deferred tax liabilities |
8 |
13 |
12 |
Other long-term liabilities |
151 |
139 |
158 |
|
1,957 |
1,941 |
1,942 |
Total liabilities |
3,633 |
3,558 |
3,502 |
Commitment and contingencies |
|
|
|
Equity |
|
|
|
Parent company stockholders' equity |
|
|
|
Common stock (preferred stock: 540,000,000 shares authorized,
not issued; common stock: Euro 1.04 nominal value, 1,200,000,000
shares authorized, 911,015,420 shares issued, 883,333,039 shares
outstanding) |
1,157 |
1,157 |
1,157 |
Capital surplus |
2,806 |
2,798 |
2,779 |
Retained earnings |
320 |
249 |
525 |
Accumulated other comprehensive income |
540 |
534 |
460 |
Treasury stock |
(243) |
(243) |
(289) |
Total parent company stockholders' equity |
4,580 |
4,495 |
4,632 |
Noncontrolling interest |
65 |
64 |
61 |
Total equity |
4,645 |
4,559 |
4,693 |
Total liabilities and equity |
8,278 |
8,117 |
8,195 |
STMicroelectronics N.V. |
|
|
|
|
|
|
|
SELECTED CASH FLOW DATA |
|
|
|
|
|
|
|
Cash Flow Data (in US$ millions) |
Q3 2016 |
Q2 2016 |
Q3 2015 |
|
|
|
|
Net Cash from operating activities |
330 |
191 |
225 |
Net Cash used in investing activities |
(230) |
(144) |
(120) |
Net Cash used in financing activities |
(107) |
(60) |
(121) |
Net Cash decrease |
(7) |
(15) |
(18) |
|
|
|
|
Selected Cash Flow Data (in US$
millions) |
Q3 2016 |
Q2 2016 |
Q3 2015 |
|
|
|
|
Depreciation & amortization |
172 |
179 |
186 |
Net payment for Capital expenditures |
(143) |
(136) |
(128) |
Dividends paid to stockholders |
(53) |
(57) |
(83) |
Change in inventories, net |
30 |
20 |
(14) |
Appendix
STMicroelectronics
Supplemental Financial Information
In the first quarter of 2016, ST realigned its
product families into three product groups to better leverage the
product synergies around its strategic focus on Smart Driving and
Internet of Things applications: Automotive and Discrete Group
(ADG); Analog and MEMS Group (AMG) and Microcontrollers and Digital
ICs Group (MDG). MDG includes ST's set-top-box business which is
currently undergoing a restructuring targeting annualized savings
of $170 million upon completion. All prior-period amounts have been
retrospectively aligned to the 2016 reporting segments.
Product
Group Data
(Million US$) |
Q3
2016 |
Q2
2016 |
Q1 2016 |
9M 2016 |
Q3
2015 |
Q2 2015 |
Q1 2015 |
9M
2015 |
Automotive & Discrete (ADG) |
|
|
|
|
|
|
|
|
-
Net Revenues |
704 |
721 |
671 |
2,096 |
706 |
714 |
674 |
2,094 |
-
Operating Income (Loss) |
58 |
61 |
39 |
158 |
68 |
46 |
36 |
150 |
Analog & MEMS (AMG) |
|
|
|
|
|
|
|
|
-
Net Revenues |
403 |
376 |
369 |
1,148 |
411 |
445 |
445 |
1301 |
-
Operating Income (Loss) |
23 |
1 |
2 |
26 |
34 |
30 |
37 |
102 |
Microcontrollers & Digital ICs (MDG) |
|
|
|
|
|
|
|
|
-
Net Revenues |
587 |
556 |
532 |
1,676 |
590 |
558 |
530 |
1,678 |
-
Operating Income (Loss) |
44 |
9 |
(3) |
49 |
22 |
(1) |
(28) |
(8) |
Others (a) |
|
|
|
|
|
|
|
|
- Net Revenues |
103 |
50 |
41 |
193 |
57 |
43 |
56 |
156 |
- Operating Income (Loss) |
(35) |
(43) |
(71) |
(148) |
(33) |
(63) |
(64) |
(160) |
Total |
|
|
|
|
|
|
|
|
- Net Revenues |
1,797 |
1,703 |
1,613 |
5,113 |
1,764 |
1,760 |
1,705 |
5,229 |
- Operating Income (Loss) |
90 |
28 |
(33) |
85 |
91 |
12 |
(19) |
84 |
(a)
Net revenues of "Others" includes revenues from
sales of Imaging Product Division, Subsystems, assembly services,
and other revenue. Operating income (loss) of
"Others" includes items such as unused capacity charges,
impairment, restructuring charges and other related closure costs,
phase out and start-up costs, and other unallocated expenses such
as: strategic or special research and development programs, certain
corporate-level operating expenses, patent claims and litigations,
and other costs that are not allocated to product groups, as well
as operating earnings of the Imaging Product Division, Subsystems
and other products. "Others" includes $11 million, $8 million, $10
million, $6 million, $9 million and $19 million of unused capacity
charges in the third, second and first quarters of 2016 and 2015,
respectively; and $29 million, $12 million, $28 million, $11
million, $21 million and $29 million of impairment, restructuring
charges, and other related closure costs in the third, second and
first quarters of 2016 and 2015, respectively.
|
Q3 2016 |
Q2 2016 |
Q1 2016 |
9M
2016 |
Q3 2015 |
Q2 2015 |
Q1
2015 |
9M 2015 |
€/$ Effective Rate |
1.12 |
1.12 |
1.10 |
1.12 |
1.16 |
1.17 |
1.23 |
1.19 |
Net
Revenues By Market Channel(%) |
Q3 2016 |
Q2 2016 |
Q1 2016 |
9M 2016 |
Q3 2015 |
Q2 2015 |
Q1 2015 |
9M 2015 |
Total
OEM |
67% |
66% |
67% |
67% |
67% |
67% |
70% |
68% |
Distribution |
33% |
34% |
33% |
33% |
33% |
33% |
30% |
32% |
(Appendix -
continued)
STMicroelectronics
Supplemental Non-U.S. GAAP Financial
Information
U. S. GAAP - Non-U.S. GAAP
Reconciliation
In Million US$ Except Per Share Data
The supplemental non-U.S. GAAP information
presented in this press release is unaudited and subject to
inherent limitations. Such non-U.S. GAAP information is not based
on any comprehensive set of accounting rules or principles and
should not be considered as a substitute for U.S. GAAP
measurements. Also, our supplemental non-U.S. GAAP financial
information may not be comparable to similarly titled non-U.S. GAAP
measures used by other companies. Further, specific limitations for
individual non-U.S. GAAP measures, and the reasons for presenting
non-U.S. GAAP financial information, are set forth in the
paragraphs below. To compensate for these limitations, the
supplemental non-U.S. GAAP financial information should not be read
in isolation, but only in conjunction with our consolidated
financial statements prepared in accordance with U.S. GAAP.
Operating income (loss) before impairment and
restructuring charges and one-time items is used by management to
help enhance an understanding of ongoing operations and to
communicate the impact of the excluded items, such as impairment,
restructuring charges and other related closure costs. Adjusted net
earnings and earnings per share (EPS) are used by management to
help enhance an understanding of ongoing operations and to
communicate the impact of the excluded items like impairment,
restructuring charges and other related closure costs attributable
to ST and other one-time items, net of the relevant tax impact.
The Company believes that these non-GAAP financial
measures provide useful information for investors and management
because they measure the Company's capacity to generate profits
from its business operations, excluding the effect of acquisitions
and expenses related to the rationalizing of its activities and
sites that it does not consider to be part of its on-going
operating results, thereby offering, when read in conjunction with
the Company's GAAP financials, (i) the ability to make more
meaningful period-to-period comparisons of the Company's on-going
operating results, (ii) the ability to better identify trends
in the Company's business and perform related trend analysis, and
(iii) an easier way to compare the Company's results of
operations against investor and analyst financial models and
valuations, which usually exclude these items.
Q3 2016
(US$ millions, except per share data ($)) |
Gross Profit |
Operating Income (loss) |
Net Earnings |
Corresponding EPS |
U.S. GAAP |
643 |
90 |
71 |
0.08 |
Impairment & Restructuring |
|
29 |
29 |
|
Estimated
Income Tax Effect |
|
|
(4) |
Non-U.S GAAP |
643 |
119 |
96 |
0.11 |
Q2 2016
(US$ millions, except per share data ($)) |
Gross Profit |
Operating Income (loss) |
Net Earnings |
Corresponding EPS |
U.S. GAAP |
577 |
28 |
23 |
0.03 |
Impairment & Restructuring |
|
12 |
12 |
|
Estimated
Income Tax Effect |
|
|
(2) |
Non-U.S GAAP |
577 |
40 |
33 |
0.04 |
Q3 2015
(US$ millions, except per share data ($)) |
Gross Profit |
Operating Income (loss) |
Net Earnings |
Corresponding EPS |
U.S. GAAP |
613 |
91 |
90 |
0.10 |
Impairment & Restructuring |
|
11 |
11 |
|
Estimated
Income Tax Effect |
|
|
- |
Non-U.S GAAP |
613 |
102 |
101 |
0.12 |
(continued)
(Appendix -
continued)
Net financial position: resources
(debt), represents the balance between our total financial
resources and our total financial debt. Our total financial
resources include cash and cash equivalents, marketable securities,
short-term deposits and restricted cash, and our total financial
debt includes short-term borrowings, current portion of long-term
debt and long-term debt, all as reported in our consolidated
balance sheet. We believe our net financial position provides
useful information for investors because it gives evidence of our
global position either in terms of net indebtedness or net cash
position by measuring our capital resources based on cash, cash
equivalents and marketable securities and the total level of our
financial indebtedness. Net financial position is not a U.S. GAAP
measure.
Net Financial Position (in US$ millions) |
October 1, 2016 |
July 2, 2016 |
September 26, 2015 |
Cash and
cash equivalents |
1,675 |
1,682 |
1,869 |
Marketable securities |
342 |
345 |
338 |
Total financial resources |
2,017 |
2,027 |
2,207 |
Short-term debt |
(117) |
(171) |
(191) |
Long-term
debt |
(1,436) |
(1,430) |
(1,557) |
Total financial debt |
(1,553) |
(1,601) |
(1,748) |
Net financial position - Non-U.S. GAAP |
464 |
426 |
459 |
Free cash flow is defined as net cash from
operating activities minus net cash from (used in) investing
activities, excluding payment for purchases (proceeds from the sale
of) marketable securities and short-term deposits, restricted cash
and net cash variation for joint ventures deconsolidation. We
believe free cash flow provides useful information for investors
and management because it measures our capacity to generate cash
from our operating and investing activities to sustain our
operating activities. Free cash flow is not a U.S. GAAP measure and
does not represent total cash flow since it does not include the
cash flows generated by or used in financing activities. In
addition, our definition of free cash flow may differ from
definitions used by other companies.
Free cash flow (in US$ millions) |
Q3 2016 |
Q2 2016 |
Q1 2016 |
9M 2016 |
Q3 2015 |
Q2 2015 |
Q1 2015 |
9M 2015 |
Net cash
from operating activities |
330 |
191 |
141 |
662 |
225 |
223 |
149 |
597 |
Net cash
used in investing activities |
(230) |
(144) |
(110) |
(484) |
(120) |
(190) |
(108) |
(418) |
Payment
for purchase and proceeds from sale of marketable securities,
investment in short-term deposits, restricted cash and net cash
variation for joint ventures deconsolidation |
- |
- |
- |
- |
(20) |
20 |
- |
- |
Free cash flow - Non-U.S. GAAP |
100 |
47 |
31 |
178 |
85 |
53 |
41 |
179 |
--end---
ST Q3 2016
earnings_27oct2016
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: STMicroelectronics via Globenewswire
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