Cirrus Logic, Inc. (Nasdaq: CRUS), a leader in high-precision
analog and digital signal processing components, today posted on
its investor relations website at http://investor.cirrus.com the
quarterly Shareholder Letter that contains the complete financial
results for the fourth quarter and fiscal year 2012, which ended
March 31, 2012, as well as the company’s current business
outlook.
“We expect revenue to grow substantially in FY ’13 as new audio
and energy products hit full production later this year,” said
Jason Rhode, president and chief executive officer. “Our product
development team has done an excellent job developing innovative
new components and our supply chain team now has the task of
supporting what we expect to be a significant ramp of a wide range
of products. Combined with our strong balance sheet, the new credit
facility gives us additional flexibility as we transition to a
significantly higher run rate for our business. We are very excited
about our outlook for FY ’13.”
Reported Financial Results
Fourth Quarter FY2012
- Revenue of $110.6 million
- Gross margin of 56 percent
- GAAP operating expenses of $41.5
million
- Non-GAAP operating expenses of $37.5
million
Due to recent financial performance, as well as further
improvements to its business outlook, the company revalued the
deferred tax asset to the full value it expects to use, which
resulted in a non-cash, net tax benefit of approximately $30
million in Q4, or $0.45 per share, based on 67.9 million diluted
shares.
A reconciliation of the non-GAAP adjustments is included in the
tables accompanying this press release.
While the company expects to grow revenue substantially during
FY ’13, year-over-year revenue in Q1 is currently forecasted to
grow approximately 10 percent. Due to the timing of various product
introductions later this year, the company expects to transition to
a sharply higher level of revenue beginning in the September
quarter. In connection with this transition, the company also
announced that it has entered into an unsecured, one-year $100
million revolving credit agreement that provides access to
additional working capital the company may need in order to support
the production ramps of multiple new products this fall. Wells
Fargo Bank, N.A., is serving as the Administrative Agent. Wells
Fargo Securities, LLC and Barclays Capital served as Joint Lead
Arrangers and Joint Bookrunners for this transaction.
Business Outlook
First Quarter FY2013
- Revenue is expected to range between
$96 million and $106 million;
- Gross margin is expected to be between
53 percent and 55 percent;
- Combined R&D and SG&A expenses
are expected to range between $43 million and $45 million, which
includes approximately $4 million in share-based compensation and
amortization of acquisition-related intangibles expenses; and
- Ending inventory is expected to roughly
double.
Cirrus Logic management will host a live Q&A session at 5:00
p.m. EDT on Wednesday, April 25, 2012, to answer questions related
to its financial results and business outlook. Shareholders who
would like to submit a question to be addressed during the call are
requested to email investor.relations@cirrus.com.
A live webcast of the Q&A session can be accessed on the
Cirrus Logic website, and a replay will be available approximately
one hour following its completion, or by calling (303) 590-3030, or
toll-free at (800) 406-7325 (Access Code: 4531962).
Cirrus Logic, Inc.
Cirrus Logic develops high-precision, analog and mixed-signal
integrated circuits for a broad range of innovative customers.
Building on its diverse analog and signal-processing patent
portfolio, Cirrus Logic delivers highly optimized products for a
variety of audio and energy-related applications. The company
operates from headquarters in Austin, Texas, with offices in
Tucson, Ariz., Europe, Japan and Asia. More information about
Cirrus Logic is available at www.cirrus.com.
Use of non-GAAP Financial Information
To supplement Cirrus Logic's financial statements presented on a
GAAP basis, Cirrus has provided non-GAAP financial information,
including operating expenses, net income, operating margin and
diluted earnings per share. A reconciliation of the adjustments to
GAAP results is included in the tables below. Non-GAAP financial
information is not meant as a substitute for GAAP results, but is
included because management believes such information is useful to
our investors for informational and comparative purposes. In
addition, certain non-GAAP financial information is used internally
by management to evaluate and manage the company. The non-GAAP
financial information used by Cirrus Logic may differ from that
used by other companies. These non-GAAP measures should be
considered in addition to, and not as a substitute for, the results
prepared in accordance with GAAP.
Safe Harbor Statement
Except for historical information contained herein, the matters
set forth in this news release contain forward-looking statements,
including our estimates of first quarter fiscal year 2013 revenue,
gross margin, combined research and development and selling,
general and administrative expense levels, share-based compensation
expense, amortization of acquired intangible expenses, and ending
inventory, as well as estimates for fiscal year 2013 annual revenue
growth rate, operating expenses, and inventory increases. In some
cases, forward-looking statements are identified by words such as
“expect,” “anticipate,” “target,” “project,” “believe,” “goals,”
“opportunity,” “estimates,” “intend,” and variations of these types
of words and similar expressions. In addition, any statements that
refer to our plans, expectations, strategies or other
characterizations of future events or circumstances are
forward-looking statements. These forward-looking statements are
based on our current expectations, estimates and assumptions and
are subject to certain risks and uncertainties that could cause
actual results to differ materially. These risks and uncertainties
include, but are not limited to, the following: the level of orders
and shipments during the first quarter and complete fiscal year
2013, as well as customer cancellations of orders, or the failure
to place orders consistent with forecasts; our ability to introduce
and ramp production of new products in a timely manner; and the
risk factors listed in our Form 10-K for the year ended March 26,
2011, and in our other filings with the Securities and Exchange
Commission, which are available at www.sec.gov. The foregoing
information concerning our business outlook represents our outlook
as of the date of this news release, and we undertake no obligation
to update or revise any forward-looking statements, whether as a
result of new developments or otherwise.
Cirrus Logic and Cirrus are trademarks of Cirrus Logic Inc.
CRUS-F
Summary financial data follows:
CIRRUS LOGIC, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (unaudited;
in thousands, except per share data) Three Months
Ended Fiscal Year Ended Mar. 31, Dec.
31, Mar. 26, Mar. 31, Mar. 26, 2012
2011 2011 2012 2011 Q4'12
Q3'12 Q4'11 Q4'12 Q4'11 Audio products
$ 90,522 $ 105,418 $ 66,965 $ 350,742 $ 264,840 Energy products
20,109 16,950 24,468
76,101 104,731
Net revenue
110,631 122,368
91,433 426,843
369,571 Cost of sales 48,284
56,338 45,415 196,402
167,576
Gross Profit 62,347 66,030
46,018 230,441 201,995 Research and
development 24,105 23,143 17,044 85,697 63,934 Selling, general and
administrative 17,254 16,488 15,252 65,108 58,066 Other expenses
(proceeds) * 100
-
57 100 (3,332 ) Total
operating expenses 41,459 39,631
32,353 150,905 118,668
Operating income 20,888 26,399 13,665
79,536 83,327 Interest income, net 139 112 187
517 860 Other income (expense), net 45 (71 )
40 (70 ) 27
Income before
income taxes 21,072 26,440 13,892
79,983 84,214 Provision (benefit) for income taxes
(29,755 ) 9,709 (116,514 )
(8,000 ) (119,289 )
Net income $ 50,827
$ 16,731 $ 130,406
$ 87,983 $ 203,503
Basic income per share: $ 0.79 $ 0.26 $ 1.91 $ 1.35 $ 3.00 Diluted
income per share: $ 0.75 $ 0.25 $ 1.80 $ 1.29 $ 2.82
Weighted average number of shares: Basic 64,213 63,957 68,164
64,934 67,857 Diluted 67,913 66,989 72,344 68,064 72,103 *
Other expenses (proceeds) contains certain litigation expenses
settled during the applicable time period as well as proceeds from
a patent agreement and an impairment of non-marketable securities
during fiscal year 2011. Prepared in accordance with
Generally Accepted Accounting Principles
CIRRUS LOGIC, INC. CONSOLIDATED CONDENSED BALANCE
SHEETS
(unaudited; in thousands)
Mar. 31, Dec. 31, Mar. 26, 2012
2011 2011 ASSETS Current assets Cash and cash
equivalents $ 65,997 $ 38,010 $ 37,039 Restricted investments -
2,898 5,786 Marketable securities 115,877 99,342 159,528 Accounts
receivable, net 44,153 54,512 39,098 Inventories 55,915 58,079
40,497 Deferred tax asset 53,137 30,798 30,797 Other current assets
16,508 16,116 6,725 Total
Current Assets 351,587 299,755 319,470 Long-term marketable
securities 2,914 20,092 12,702 Property and equipment, net 66,978
57,263 34,563 Intangibles, net 18,241 18,596 20,125 Goodwill 6,027
6,027 6,027 Deferred tax asset 89,071 82,071 102,136 Other assets
9,644 10,813 1,598 Total
Assets $ 544,462 $ 494,617 $ 496,621
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts
payable $ 38,108 $ 45,104 $ 27,639 Accrued salaries and benefits
13,634 11,539 12,402 Other accrued liabilities 14,015 14,259 5,169
Deferred income on shipments to distributors 7,228
8,511 6,844 Total Current Liabilities
72,985 79,413 52,054 Long-term restructuring accrual - - 113
Other long-term obligations 5,620 6,494 6,075 Stockholders'
equity: Capital stock 1,008,228 1,001,967 991,947 Accumulated
deficit (541,609 ) (592,436 ) (552,814 ) Accumulated other
comprehensive loss (762 ) (821 ) (754 ) Total
Stockholders' Equity 465,857 408,710
438,379 Total Liabilities and Stockholders' Equity $
544,462 $ 494,617 $ 496,621 Prepared in
accordance with Generally Accepted Accounting Principles
CIRRUS LOGIC, INC.
RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL
INFORMATION
(unaudited; in thousands, except per
share data)
(not prepared in accordance with GAAP)
Non-GAAP financial information is not
meant as a substitute for GAAP results, but is included because
management believes such information is useful to our investors for
informational and comparative purposes. In addition, certain
non-GAAP financial information is used internally by management to
evaluate and manage the company. The non-GAAP financial information
used by Cirrus Logic may differ from that used by other companies.
These non-GAAP measures should be considered in addition to, and
not as a substitute for, the results prepared in accordance with
GAAP.
Three Months Ended Fiscal Year Ended
Mar. 31, Dec. 31, Mar. 26, Mar. 31,
Mar. 26, 2012 2011 2011 2012
2011 Q4'12 Q3'12 Q4'11 Q4'12
Q4'11 Net Income Reconciliation
GAAP Net Income
$ 50,827 $ 16,731 $
130,406 $ 87,983 $ 203,503
Amortization of acquisition intangibles 353 353 353 1,412 1,429
Stock-based compensation expense 3,451 2,769 2,294 12,179 8,142
Other adjustments ** 263 - 57 885 (2,638 ) Provision (benefit) for
income taxes (30,310 ) 8,992 (117,078 )
(10,171 ) (121,154 )
Non-GAAP Net Income
$ 24,584 $ 28,845
$ 16,032 $ 92,288
$ 89,282 Earnings Per Share
Reconciliation
GAAP Diluted income per share $
0.75 $ 0.25 $ 1.80 $
1.29 $ 2.82 Effect of Amortization of
acquisition intangibles 0.01 0.01 - 0.02 0.02 Effect of Stock-based
compensation expense 0.05 0.04 0.03 0.18 0.11 Effect of Other
adjustments ** - - - 0.01 (0.03 ) Effect of Provision (benefit) for
income taxes (0.45 ) 0.13 (1.61 )
(0.14 ) (1.68 )
Non-GAAP Diluted income per
share $ 0.36 $ 0.43
$ 0.22 $ 1.36 $
1.24 Operating Income Reconciliation
GAAP
Operating Income $ 20,888 $ 26,399
$ 13,665 $ 79,536 $
83,327 Amortization of acquisition intangibles 353 353 353
1,412 1,429 Stock compensation expense - COGS 113 92 78 398 243
Stock compensation expense - R&D 1,753 1,613 924 5,590 2,641
Stock compensation expense - SG&A 1,585 1,064 1,292 6,191 5,258
Other adjustments ** 263 - 57
885 (2,638 )
Non-GAAP Operating
Income $ 24,955 $ 29,521
$ 16,369 $ 94,012
$ 90,260 Operating Expense
Reconciliation
GAAP Operating Expenses $
41,459 $ 39,631 $ 32,353
$ 150,905 $ 118,668 Amortization of
acquisition intangibles (353 ) (353 ) (353 ) (1,412 ) (1,429 )
Stock compensation expense - R&D (1,753 ) (1,613 ) (924 )
(5,590 ) (2,641 ) Stock compensation expense - SG&A (1,585 )
(1,064 ) (1,292 ) (6,191 ) (5,258 ) Other adjustments **
(263 ) - (57 ) (885 ) 2,638
Non-GAAP Operating Expenses $ 37,505
$ 36,601 $ 29,727
$ 136,827 $ 111,978
** Other adjustments may include certain litigation
expenses, facility charges, patent agreements, international sales
reorganizations, or other.
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