ISSI (MM)

SAN JOSE, Calif., April 28 /PRNewswire-FirstCall/ -- Integrated Silicon Solution, Inc. (NASDAQ:ISSI) today reported its financial results for its second fiscal quarter ended March 31, 2009. Revenue in the quarter ended March 31, 2009 was $31.3 million, a 17% decrease from revenue of $37.7 million in the December 2008 quarter and a 46% decrease from revenue of $58.0 million in the March 2008 quarter. Gross margin for the quarter was 20.7%, compared with 20.5% in the December 2008 quarter and 22.9% in the March 2008 quarter. The Company reported a net loss for the March 2009 quarter of $3.8 million or ($0.15) per diluted share. These results compare with a net loss for the December 2008 quarter of $4.1 million or ($0.16) per share. The Company reported net income for the March 2008 quarter of $2.0 million, or $0.07 per diluted share. The Company's cash, cash equivalents and short-term investments totaled $44.0 million at March 31, 2009, compared to $45.7 million at December 31, 2008. In addition, the Company had long-term investments of $21.1 million at March 31, 2009, the same amount as at December 31, 2008. The Company's inventory at March 31, 2009 totaled $27.7 million, a reduction of $10.4 million from December 31, 2008. "Demand further weakened in all of our markets during the March quarter due to the worldwide economic slowdown. However, we believe demand has now stabilized and that customers are nearing the completion of their inventory reductions," said Scott Howarth, ISSI's President and CEO. "During the March quarter, we took further actions to preserve cash by reducing our spending and inventory significantly which reduced our net loss despite the decline in our revenue. Our balance sheet remains very strong as we had $65.1 million in cash and investments at March 31," added Mr. Howarth. Conference Call A conference call will be held today at 1:30 p.m. Pacific time to discuss this release. To access ISSI's conference call via telephone, dial 1-800-210-9006 by 1:20 p.m. Pacific time. The call will be webcast from ISSI's website at http://www.issi.com/. About the Company ISSI is a fabless semiconductor company that designs and markets high performance integrated circuits for the following key markets: (i) digital consumer electronics, (ii) networking, (iii) mobile communications, (iv) automotive electronics, and (v) industrial. The Company's primary products are high speed and low power SRAM and low and medium density DRAM. The Company also designs and markets EEPROM, SmartCards and is developing selected non-memory products focused on its key markets. ISSI is headquartered in Silicon Valley with worldwide offices in Taiwan, Japan, Singapore, China, Europe, Hong Kong, India, and Korea. Visit our web site at http://www.issi.com/. Forward Looking Statements This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements concerning our belief that demand has now stabilized and that customers are nearing the completion of their inventory reductions and our balance sheet remaining strong are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those anticipated. Such risks and uncertainties include supply and demand conditions in the market resulting from adverse conditions in the economy, liquidity and credit concerns or other factors, unexpected reductions in average selling prices for our products, our ability to sell our products for key applications and the pricing and gross margins achieved on such sales, our ability to control or reduce operating expenses, changes in manufacturing yields, order cancellations, order rescheduling, product warranty claims, competition, the level and value of inventory held by OEM customers, or other risks listed from time to time in the Company's filings with the Securities and Exchange Commission, including the Company's Form 10-K for the year ended September 30, 2008 and the Company's Form 10-Q for the quarter ended December 31, 2008. The Company assumes no obligation to update or revise the forward-looking statements in this release because of new information, future events, or otherwise. Integrated Silicon Solution, Inc. Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except per share data) Three Months Six Months Ended Ended March 31, March 31, --------- --------- 2009 2008 2009 2008 ---- ---- ---- ---- Net sales $31,253 $58,046 $68,918 $121,394 Cost of sales 24,786 44,750 54,718 94,897 ------ ------ ------ ------ Gross profit 6,467 13,296 14,200 26,497 ----- ------ ------ ------ Operating expenses: Research and development 4,186 4,935 9,394 9,709 Selling, general and administrative 6,408 7,463 13,709 15,125 ----- ----- ------ ------ Total operating expenses 10,594 12,398 23,103 24,834 ------ ------ ------ ------ Operating income (loss) (4,127) 898 (8,903) 1,663 Interest and other income, net 282 1,105 864 3,179 Gain on sale of investments - - - 189 --- --- --- --- Income (loss) before income taxes and minority interest (3,845) 2,003 (8,039) 5,031 Provision (benefit) for income taxes (42) 40 (102) 100 --- -- ---- --- Income (loss) before minority interest (3,803) 1,963 (7,937) 4,931 Minority interest in net (income) loss of consolidated subsidiaries (23) 20 41 19 --- -- -- -- Net income (loss) $(3,826) $1,983 $(7,896) $4,950 ======= ====== ======= ====== Basic net income (loss) per share $(0.15) $0.07 $(0.31) $0.15 ====== ===== ====== ===== Shares used in basic per share calculation 25,508 28,160 25,556 32,374 ====== ====== ====== ====== Diluted net income (loss) per share $(0.15) $0.07 $(0.31) $0.15 ====== ===== ====== ===== Shares used in diluted per share calculation 25,508 28,436 25,556 32,668 ====== ====== ====== ====== Integrated Silicon Solution, Inc. Condensed Consolidated Balance Sheets (In thousands) March 31, September 30, 2009 2008 ---- ---- (unaudited) (1) ASSETS Current assets: Cash and cash equivalents $38,233 $42,175 Short-term investments 5,804 7,840 Accounts receivable, net 19,055 34,741 Inventories 27,662 39,222 Other current assets 2,754 4,717 ----- ----- Total current assets 93,508 128,695 Property, equipment and leasehold improvements, net 23,811 24,555 Long-term investments 21,088 19,304 Purchased intangible assets, net 2,371 2,000 Other assets 1,349 1,397 ----- ----- Total assets $142,127 $175,951 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $13,183 $35,171 Accrued compensation and benefits 3,118 3,729 Accrued expenses 5,805 8,157 ----- ----- Total current liabilities 22,106 47,057 Other long-term liabilities 667 715 --- --- Total liabilities 22,773 47,772 Commitments and contingencies Minority interest 2,396 789 Stockholders' equity: Common stock 3 3 Additional paid-in capital 309,771 310,712 Accumulated deficit (188,327) (180,431) Accumulated other comprehensive loss (4,489) (2,894) ------ ------ Total stockholders' equity 116,958 127,390 ------- ------- Total liabilities and stockholders' equity $142,127 $175,951 ======== ======== (1) Derived from audited financial statements. DATASOURCE: Integrated Silicon Solution, Inc. CONTACT: John M. Cobb, Chief Financial Officer of Integrated Silicon Solution, Inc., or Investor Relations, +1-408-969-6600, Web Site: http://www.issi.com/

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