EXHIBIT 99.1
Published on January 24, 2008
 |
EXHIBIT
99.1
NEWS
RELEASE
INVESTOR
RELATIONS
CONTACT:
Gordon
Parnell - CFO .
. . (480) 792-7374
|
MICROCHIP TECHNOLOGY ANNOUNCES NET SALES AND
NET
INCOME FOR THIRD QUARTER FISCAL YEAR 2008
AND
RECORD QUARTERLY CASH DIVIDEND
|
|
·
|
Net
sales of $252.6 million,
down 2.3% sequentially and up 0.6% over the year ago
quarter
|
|
|
·
|
On
a GAAP
basis:
|
|
|
·
|
Record
gross margin of 60.6%;
operating margin of 31.4%; net income of $80.1 million and 31.7%;
EPS of
38 cents per diluted share
|
|
|
·
|
On
a non-GAAP
basis:
|
|
|
·
|
Record
gross margin of 61.2%;
operating margin of 34.7%; net income of $81.2 million and 32.1%;
Record
EPS of 39 cents per diluted
share
|
|
|
·
|
Net
cash generated of $131
million for the December quarter, excludes dividend, stock buy back,
cash
received from the sale of Fab 3, and the net proceeds of the Junior
Subordinated Convertible Debt
Transaction
|
|
|
·
|
Increased
dividend by 3.2%
sequentially to a record 32 cents per share; represents an increase
of
20.8% from dividend level a year
ago
|
|
|
·
|
Shipped
a record 28,722
development systems in the December
quarter
|
CHANDLER,
Arizona – January 24, 2008 – (NASDAQ: MCHP) – Microchip Technology
Incorporated, a leading provider of microcontroller and analog semiconductors,
today reported results for the three months ended December 31,
2007. Net sales for the third quarter of fiscal 2008 were $252.6
million, down 2.3% sequentially from net sales of $258.6 million in the
immediately preceding quarter, and up 0.6% from net sales of $251.0 million
in
the prior year’s third quarter. The Company adopted SFAS No. 123
(revised 2004) “Share-Based Payment” at the beginning of fiscal year
2007. As such, the Company has included additional non-GAAP
information in its disclosures to assist shareholders with appropriate
comparative information. GAAP net income for the third quarter of
fiscal 2008 was $80.1 million, or 38 cents per diluted share, up 32.0% from
GAAP
net income of $60.7 million, or 27 cents per diluted share, in the immediately
preceding quarter, and up 10.0% from GAAP net income of $72.8 million, or 33
cents per diluted share, in the prior year’s third quarter.
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Non-GAAP
net income for the third quarter of fiscal 2008 was $81.2 million, down 2.5%
from non-GAAP net income of $83.3 million in the immediately preceding quarter,
and up 3.1% from non-GAAP net income of $78.7 million in the prior year’s third
quarter. Non-GAAP earnings per share were a record 39 cents per
diluted share in the third quarter of fiscal 2008, compared to 38 cents per
diluted share in the immediately preceding quarter and 36 cents per diluted
share in the prior year’s third quarter. Non-GAAP results exclude a
one-time favorable event related to the resolution of a foreign tax matter
and
the effect of share-based compensation. A reconciliation of non-GAAP
and GAAP results is included in this press release.
Microchip
also announced today that its Board of Directors has declared a quarterly cash
dividend on its common stock of 32 cents per share. The quarterly
dividend is payable on February 21, 2008 to stockholders of record on February
7, 2008. Microchip initiated quarterly cash dividend payments in the
third quarter of fiscal 2003.
“In
difficult business conditions, we achieved net sales of $252.6 million, down
2.3% sequentially, and slightly better than the mid-point of our guidance,” said
Steve Sanghi, Microchip’s President and CEO. “Despite the industry
conditions, we achieved record gross margins of 61.2% on a non-GAAP basis and
60.6% on a GAAP basis. We also met the high end of our EPS guidance
for GAAP and non-GAAP results of 38 and 39 cents, respectively.”
“As
expected, Asia was the only geography to grow sequentially in the December
quarter. Both the Americas and Europe were more significantly
impacted by seasonal factors in the quarter as well as economic factors,”
continued Mr. Sanghi.
Mr.
Sanghi stated, “Shipments of development tools continued at very strong levels
in the December quarter, achieving record levels of shipments of 28,722 in
the
quarter, with worldwide cumulative shipments of over 599,000.”
“While
overall revenues for microcontrollers were down approximately 1% sequentially,
revenues were up approximately 1.5% from the year ago quarter,” said Ganesh
Moorthy, Executive Vice President. “Sixteen-bit microcontrollers had
another strong quarter with revenues up 28% sequentially and up 138% from the
year ago quarter.”
Mr.
Moorthy added, “Flash microcontroller revenues achieved a new record, and were
also up 10% over the year ago quarter. These results culminated in
the shipment of our 6 billionth microcontroller in late December.”
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Mr.
Gordon Parnell, Microchip’s Chief Financial Officer, said, “Inventory on our
balance sheet was essentially unchanged at the end of December in dollar terms,
representing approximately 114 days of inventory. Inventory in the
distribution channel was approximately 1.9 months of
inventory. Overall, we remain comfortable with the levels of
inventory supporting our business.”
Mr.
Parnell continued, “Cash generation from operations of $131 million in the
December quarter reflects the strong gross and operating margins of the
business, as well as excellent working capital management. Cash
generation from operations excludes the dividend payment to investors of $66.4
million, $814.6 million which was used to buy back stock, and the proceeds
of
our junior subordinated convertible debt transaction of $1,127
million. Cash generation for all of fiscal 2008 will be approximately
$480 million. The cornerstone of our commitment to return value to
shareholders through increasing dividends was again reflected in the dividend
increase to 32 cents announced today. The strength of our business
model is also demonstrated by the fact that we are at record gross margin and
earnings levels while at a low point in revenues for this business
cycle.”
Mr.
Sanghi concluded, “Market conditions for the March quarter include consideration
of the seasonal effects of the Lunar New Year holidays in Asia. Our
book-to-bill for the December quarter was 1.02, and the overall opening backlog
position for the March quarter was significantly higher than at the beginning
of
the December quarter. We expect sales to be down 2% to up 4% in the
March quarter, based on current information. EPS on a GAAP basis is
expected to be 35 to 38 cents, and non-GAAP EPS is expected to be approximately
39 to 42 cents.”
Microchip’s
Recent
Highlights:
|
·
|
Microchip
entered the $4 billion 32-bit microcontroller market with the PIC32
Family. By seamlessly integrating the new 32-bit family with its
existing
microcontroller portfolio, Microchip has become the only company
to offer
its customers support for a complete 8-, 16- and 32-bit microcontroller
line under a single development environment.
|
|
·
|
The
Company was recently recognized by three national business and electronics
publications for product and organizational leadership, including
being
named to Forbes Magazine’s 10th annual list of the 400 Best Big Companies
in America; inclusion of the 32-bit PIC32 Family on EDN Magazine’s
prestigious “Hot 100 Products of 2007” list; and the PIC24FJ64GA004 16-bit
microcontroller family being chosen by the readers of
ECN Magazine as the best product in the “Embedded Systems” category of the
“ECN 2007 Readers Choice Tech Awards.”
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·
|
Microchip’s
QVGA Graphics Solution was introduced to meet the large demand for
implementing graphics display and control in cost-sensitive graphical
user
interface applications. This easy-to-use offering comprises a
free graphics library; third-party library support; the new Graphics
PICtail™ Plus daughter board; and PIC24F 16-bit microcontrollers.
|
|
·
|
Demonstrating
Microchip’s ongoing commitment to provide outstanding technical support,
the Company garnered record attendance at the recently concluded
“Microchip’s Annual Strategic Technical Exchange Review” (MASTERs)
conference series, now in its 11th year, with nearly 3,000 embedded
designers attending 13 separate conferences that were held in four
different languages across seven countries.
|
|
·
|
During
the quarter, Microchip shipped 28,722 new development systems—setting
another Company record and demonstrating the continued strong acceptance
of Microchip’s products. The total cumulative number of
development systems shipped now stands at 599,313.
|
|
·
|
Expansion
continued on the 8-bit PIC®
microcontroller front, with 12 new high-performance USB, LCD and
general-purpose devices that add an on-chip 12-bit Analog-to-Digital
Conversion (ADC) peripheral to remove the cost and complexity of
external
ADCs in advanced sensor designs. Additionally, Microchip
introduced its first Baseline PIC microcontrollers with non-volatile
Flash
data memory, providing engineers with a diverse feature set to select
from
when integrating digital intelligence in low-cost applications.
|
|
·
|
Microchip
introduced a large number of analog products during the quarter,
including
the expansion of its low dropout regulator (LDO) family; the MCP1631
2.0
MHz, high-speed Pulse Width Modulator (PWM); non-volatile and volatile
digital potentiometers with an SPI interface; the MCP1602 2.0 MHz,
500 mA
switching regulator; the industry’s first Digital-to-Analog
Converter (DAC) to combine integrated EEPROM memory and 12-bit resolution
in a miniature, 6-pin SOT-23 package; and dual-input, high-current
Li-Ion/Polymer charge-management controllers with automatic USB or
AC
adapter power-source selection.
|
|
·
|
Evidencing
Microchip’s guiding value that “employees are our greatest strength”, the
Company recently made Training Magazine’s coveted Top 125 list—the most
elite ranking among Fortune 500 companies for employee training and
learning development. Microchip was also selected by the
Phoenix Business Journal as
one of the “Best Places to Work in the Valley,” placing it among the
top-30 large (250+ employees) Arizona companies for which to work.
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Fourth
Quarter Fiscal 2008 Outlook:
The
following
statements are based on current expectations. These statements
are forward-looking, and actual results may differ materially.
|
·
|
Net
sales for the quarter ending March 31, 2008 are currently anticipated
to
be down 2% to up 4% compared to the December 2007 quarter.
|
|
·
|
Gross
margin for the quarter ending March 31, 2008 is anticipated to be
approximately 60.8% to 60.9% on a GAAP basis, and approximately 61.3%
to
61.5% on a non-GAAP basis, prior to the effect of share-based
compensation. Generally, gross margin fluctuates over time, driven
primarily by the mix of microcontrollers, analog products and memory
products sold; variances in manufacturing yields; fixed cost absorption;
wafer fab loading levels; pricing pressures in our non-proprietary
product
lines; and competitive and economic conditions.
|
|
·
|
Operating
expenses for the quarter ending March 31, 2008 are expected to be
approximately 28.7% to 30.0% on a GAAP basis, and approximately 26.0%
to
27.0% on a non-GAAP basis, prior to the effect of share-based compensation
expense. Operating expenses fluctuate over time, primarily due to
revenue
and profit levels.
|
|
·
|
The
tax rate on a GAAP and non-GAAP basis for the quarter ending March
31,
2008 is anticipated to be approximately 18.4% to 18.6%.
|
|
·
|
Earnings
per diluted share for the quarter ending March 31, 2008 are anticipated
to
be approximately 35 to 38 cents on a GAAP basis, and approximately
39 to
42 cents on a non-GAAP
basis, excluding the effect of share-based compensation expense.
|
|
·
|
The
level of inventories fluctuates over time, primarily due to sales
volume
and overall capacity utilization. Based on our sales guidance, on
both a
GAAP and non-GAAP basis, inventories at March 31, 2008 are anticipated
to
be 110 to 120 days.
|
|
·
|
Capital
expenditures for the quarter ending March 31, 2008 are expected to
be
approximately $15 million, and capital expenditures for fiscal year
2008
are expected to total approximately $65 million. The level of capital
expenditures varies from time to time as a result of actual and
anticipated business conditions.
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·
|
Based
on cash projected to be generated from operations and current projected
capital expenditure levels, we expect net cash generation during
the March
quarter of approximately
$105 million before the dividend payment
of
approximately $60.6 million announced today. The amount of expected
cash
generation is before the effect of any stock
buy-back activity.
|
|
·
|
Microchip
announced on October 25, 2006 that its Board of Directors had authorized
a
stock buy-back of up to 10.0 million shares and December 11, 2007
that its
Board of Directors had authorized a stock buy-back of up to an
additional
10.0 million shares. At December 31, 2007, approximately 12.0 million
shares remained available for purchase under these
programs. Future purchases will depend upon market conditions,
interest rates and corporate considerations.
|
Use of Non-GAAP Financial Measures:
SFAS
123(R) requires us to estimate the cost of certain forms of share-based
compensation, including employee stock options and awards under our employee
stock purchase plan (ESPP
Plan), and to record a commensurate expense in our income
statement. Share-based compensation expense is a non-cash expense
that varies in amount from period to period and
is
affected by market forces that are difficult to predict and are not within
the
control of management, such as the price of our common stock. Our
sale of Fab 3 in Puyallup, Washington and
the
tax benefit related to the resolution of a foreign tax matter are non-recurring
events in our business. Accordingly, management excludes these items
from its internal operating forecasts and models.
We
are
using non-GAAP profit, non-GAAP research and development expenses, non-GAAP
selling, general and administration expenses, non-GAAP operating income,
non-GAAP net
income, and non-GAAP diluted earnings per share, which excludes share-based
compensation expense, the sale of Fab 3 in the second quarter of fiscal 2008,
and a tax benefit in the
third
quarter of fiscal 2008 related to the resolution of a foreign tax matter, to
permit additional analysis of our performance. Management believes
these non-GAAP measures are useful to investors because they enhance the
understanding of our historical financial performance and comparability between
periods. Many of our investors have requested that we
disclose this non-GAAP information because they believe it is useful in
understanding our performance as it excludes non-cash and other special charges
that many investors feel
may
obscure our true operating costs. Management uses these non- GAAP
measures to manage and assess the profitability of its
business. Specifically, we do not consider share-based
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compensation
expense when developing and monitoring budgets and spending. The
economic substance behind our decision to exclude share-based compensation
relates to these charges being non-cash in nature. The exclusion of
favorable tax events and our sale of Fab 3 in our non-GAAP disclosures are
based
on the non-recurring nature of these events. Our
determination of the above non-GAAP measures might not be the same as similarly
titled measures used by other companies, and it should not be construed as
a
substitute for gross
margin; research and development expenses; selling, general and administrative
expenses; operating income; net income and diluted earnings per share determined
in accordance with GAAP. There are limitations associated with using
non-GAAP measures, including that they exclude financial information that some
may consider important in evaluating our performance. Management
compensates for this by presenting information on both a GAAP and non-GAAP
basis
for investors and providing reconciliations of the GAAP and non-GAAP
results.
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MICROCHIP
TECHNOLOGY INCORPORATED AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(in
thousands, except per share amounts)
|
Three
Months Ended
December
31,
|
Nine
Months Ended
December
31,
|
|||||||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||||||
|
Net
sales
|
$ | 252,600 | $ | 251,004 | $ | 775,319 | $ | 781,495 | ||||||||
|
Cost
of
sales
|
99,553 | 101,294 | 309,015 | 311,340 | ||||||||||||
|
Gross
margin
|
153,047 | 149,710 | 466,304 | 470,155 | ||||||||||||
|
Operating
expenses:
|
||||||||||||||||
|
Research
and
development
|
30,306 | 28,043 | 89,358 | 85,151 | ||||||||||||
|
Selling,
general and
administrative
|
43,501 | 40,185 | 130,250 | 122,482 | ||||||||||||
|
Special
charge – sale of Fab
3
|
- | - | 26,763 | - | ||||||||||||
| 73,807 | 68,228 | 246,371 | 207,633 | |||||||||||||
|
Operating
margin
|
79,240 | 81,482 | 219,933 | 262,522 | ||||||||||||
|
Other
income and expense,
net
|
12,037 | 14,372 | 42,231 | 39,216 | ||||||||||||
|
Income
before income
taxes
|
91,277 | 95,854 | 262,164 | 301,738 | ||||||||||||
|
Income
taxes
|
11,153 | 23,005 | 41,068 | 72,417 | ||||||||||||
|
Net
income
|
$ | 80,124 | $ | 72,849 | $ | 221,096 | $ | 229,321 | ||||||||
|
Basic
net income per
share
|
$ | 0.39 | $ | 0.34 | $ | 1.02 | $ | 1.07 | ||||||||
|
Diluted
net income per
share
|
$ | 0.38 | $ | 0.33 | $ | 1.00 | $ | 1.04 | ||||||||
|
Basic
shares used in
calculation
|
207,002 | 215,710 | 216,046 | 214,603 | ||||||||||||
|
Diluted
shares used in
calculation
|
211,337 | 220,920 | 221,097 | 219,837 | ||||||||||||
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MICROCHIP
TECHNOLOGY INCORPORATED AND SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
(in
thousands)
ASSETS
|
December
31,
2007
|
March
31,
2007
|
|||||||
|
(Unaudited)
|
||||||||
|
Cash
and short-term
investments
|
$ | 1,438,016 | $ | 750,477 | ||||
|
Accounts
receivable,
net
|
114,396 | 124,559 | ||||||
|
Inventories
|
124,801 | 121,024 | ||||||
|
Other
current
assets
|
120,009 | 88,677 | ||||||
|
Total
current
assets
|
1,797,222 | 1,084,737 | ||||||
|
Property,
plant & equipment,
net
|
524,769 | 605,722 | ||||||
|
Long-term
investments
|
215,384 | 527,910 | ||||||
|
Other
assets
|
79,373 | 51,172 | ||||||
|
Total
assets
|
$ | 2,616,748 | $ | 2,269,541 | ||||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
Accounts
payable and other accrued
liabilities
|
$ | 83,455 | $ | 164,557 | ||||
|
Deferred
income on shipments to
distributors
|
93,349 | 91,363 | ||||||
|
Total
current
liabilities
|
176,804 | 255,920 | ||||||
|
Convertible
debentures
|
1,150,103 | - | ||||||
|
Long-term
income tax
payable
|
111,512 | - | ||||||
|
Deferred
tax
liability
|
14,112 | 8,327 | ||||||
|
Other
long-term
liabilities
|
1,022 | 926 | ||||||
|
Stockholders'
equity
|
1,163,195 | 2,004,368 | ||||||
|
Total
liabilities and
stockholders' equity
|
$ | 2,616,748 | $ | 2,269,541 |
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MICROCHIP
TECHNOLOGY INCORPORATED AND SUBSIDIARIES
RECONCILIATION
OF GAAP TO NON-GAAP MEASURES
(Unaudited)
(in
thousands except per share amounts and percentages)
RECONCILIATION
OF GROSS MARGIN TO NON-GAAP GROSS MARGIN
|
Three
Months Ended
December
31,
|
Nine
Months Ended
December
31,
|
|||||||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||||||
|
Gross
margin, as reported
|
$ | 153,047 | $ | 149,710 | $ | 466,304 | $ | 470,155 | ||||||||
|
Share-based
compensation expense
|
1,555 | 1,595 | 4,638 | 1,595 | ||||||||||||
|
Non-GAAP
gross margin
|
$ | 154,602 | $ | 151,305 | $ | 470,942 | $ | 471,750 | ||||||||
|
Non-GAAP
gross margin percentage
|
61.2 | % | 60.3 | % | 60.7 | % | 60.4 | % | ||||||||
RECONCILIATION
OF RESEARCH AND DEVELOPMENT EXPENSES TO NON-GAAP
RESEARCH
AND DEVELOPMENT EXPENSES
|
Three
Months Ended
December
31,
|
Nine
Months Ended
December
31,
|
|||||||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||||||
|
Research
and development expenses, as reported
|
$ | 30,306 | $ | 28,043 | $ | 89,358 | $ | 85,151 | ||||||||
|
Share-based
compensation expense
|
(2,729 | ) | (2,431 | ) | (7,824 | ) | (7,244 | ) | ||||||||
|
Non-GAAP
research and development expenses
|
$ | 27,577 | $ | 25,612 | $ | 81,534 | $ | 77,907 | ||||||||
|
Non-GAAP
research and development expenses as a percentage of
revenue
|
10.9 | % | 10.2 | % | 10.5 | % | 10.0 | % | ||||||||
RECONCILIATION
OF SELLING, GENERAL AND ADMINISTRATIVE EXPENSES TO
NON-GAAP
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
|
Three
Months Ended
December
31,
|
Nine
Months Ended
December
31,
|
|||||||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||||||
|
Selling,
general and administrative expenses, as reported
|
$ | 43,501 | $ | 40,185 | $ | 130,250 | $ | 122,482 | ||||||||
|
Share-based
compensation expense
|
(4,073 | ) | (3,714 | ) | (11,699 | ) | (10,874 | ) | ||||||||
|
Non-GAAP
selling, general and administrative expenses
|
$ | 39,428 | $ | 36,471 | $ | 118,551 | $ | 111,608 | ||||||||
|
Non-GAAP
selling, general and administrative expenses as a percentage of
revenue
|
15.6 | % | 14.5 | % | 15.3 | % | 14.3 | % | ||||||||
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RECONCILIATION
OF OPERATING INCOME TO NON-GAAP OPERATING INCOME
|
Three
Months Ended
December
31,
|
Nine
Months Ended
December
31,
|
|||||||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||||||
|
Operating
income, as reported
|
$ | 79,240 | $ | 81,482 | $ | 219,933 | $ | 262,522 | ||||||||
|
Adjustments
to reconcile operating income to non-GAAP operating
income:
|
||||||||||||||||
|
Share-based
compensation
expense
|
8,357 | 7,740 | 24,161 | 19,713 | ||||||||||||
|
Special
charge – sale of Fab
3
|
- | - | 26,763 | - | ||||||||||||
|
Non-GAAP
operating income
|
$ | 87,597 | $ | 89,222 | $ | 270,857 | $ | 282,335 | ||||||||
|
Non-GAAP
operating income as a percentage of revenue
|
34.7 | % | 35.5 | % | 34.9 | % | 36.1 | % | ||||||||
RECONCILIATION
OF NET INCOME AND DILUTED NET INCOME PER SHARE TO
NON-GAAP
NET INCOME AND NON-GAAP DILUTED NET INCOME PER SHARE
|
Three
Months Ended
December
31,
|
Nine
Months Ended
December
31,
|
|||||||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||||||
|
Net
income, as reported
|
$ | 80,124 | $ | 72,849 | $ | 221,096 | $ | 229,321 | ||||||||
|
Adjustments
to reconcile net income to non-GAAP net income:
|
||||||||||||||||
|
Share-based
compensation
expense, net of tax effect
|
6,811 | 5,883 | 19,398 | 14,983 | ||||||||||||
|
Special
charge – sale of Fab 3,
net
of tax effect
|
- | - | 16,459 | - | ||||||||||||
|
Tax
benefit on resolution of
foreign tax matter
|
(5,733 | ) | - | (5,733 | ) | - | ||||||||||
|
Non-GAAP
net income
|
$ | 81,202 | $ | 78,732 | $ | 251,220 | $ | 244,304 | ||||||||
|
Non-GAAP
net income as a percentage of revenue
|
32.1 | % | 31.4 | % | 32.4 | % | 31.3 | % | ||||||||
|
Diluted
net income per share, as reported
|
$ | 0.38 | $ | 0.33 | $ | 1.00 | $ | 1.04 | ||||||||
|
Adjustments
to reconcile net income to non-GAAP net income:
|
||||||||||||||||
|
Share-based
compensation
expense, net of tax effect
|
0.03 | 0.03 | 0.09 | 0.07 | ||||||||||||
|
Special
charge – sale of Fab 3,
net
of tax effect
|
- | - | 0.07 | - | ||||||||||||
|
Tax
benefit on resolution of
foreign tax matter
|
(0.02 | ) | - | (0.02 | ) | - | ||||||||||
|
Non-GAAP
diluted net income per share
|
$ | 0.39 | $ | 0.36 | $ | 1.14 | $ | 1.11 | ||||||||
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Conference
Call and
Updates:
Microchip
will host a conference call today January 24, 2008 at 5:00 p.m. (Eastern Time)
to discuss this release. This call will be simulcast over the
Internet at www.microchip.com. The
webcast will be available for replay until January 31, 2008.
A
telephonic replay of the conference call will be available at approximately
7:00
p.m. (Eastern Time) January 24, 2008 and will remain available until 5:00 p.m.
(Eastern Time) on January
31, 2008. Interested parties may listen to the replay by dialing
719-457-0820 and entering access code 8652924.
Cautionary
Statement:
The
statements in this release relating to remaining comfortable with the levels
of
inventory supporting our business, cash generation in fiscal 2008, our
commitment to return cash to
shareholders through increasing dividends, a low point in revenues for this
business cycle, the strength of our business model, the seasonal effects of
the
Lunar New Year holidays in
Asia,
sequential revenue to be down 2% to up 4% in the March quarter, GAAP EPS and
non-GAAP EPS for the March quarter, continued strong acceptance of our products
and the
statements containing our GAAP and non-GAAP guidance (as applicable) for the
quarter ending March 31, 2008 with respect to net sales, gross margin, operating
expenses, tax
rate,
earnings per diluted share, days of inventory, capital expenditures for the
quarter ending March 31, 2008 and for fiscal 2008, and net cash generation
are
forward-looking statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. These statements involve risks
and
uncertainties that could cause our actual results to differ materially,
including, but not limited to: changes in demand or market acceptance
of our products and the products of our customers; the mix of inventory we
hold
and our ability to satisfy short-term orders from our inventory; changes in
utilization of our manufacturing capacity; our ability to continue to secure
sufficient assembly and testing capacity; competitive developments including
pricing pressures; the level of orders that are received and can be
shipped in a quarter; the level of sell-through of our products through
distribution; changes or fluctuations in customer order patterns and
seasonality; foreign currency effects on our business; costs and outcome of
any
current or future tax audit or
any
litigation involving intellectual property, customers or other issues;
disruptions in our business or the businesses of our customers or suppliers
due
to natural disasters,
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terrorist
activity, armed conflict, war, worldwide oil prices and supply, public health
concerns or disruptions in the transportation system; and general economic,
industry or political conditions in the United States or
internationally.
For
a
detailed discussion of these and other risk factors, please refer to Microchip's
filings on Forms 10-K and 10-Q. You can obtain copies of Forms 10-K
and 10-Q and other relevant documents for free at Microchip’s Web site
(www.microchip.com) or the SEC's Web site (www.sec.gov) or from commercial
document retrieval services.
Stockholders
of Microchip are cautioned not to place undue reliance on our forward-looking
statements, which speak only as of the date such statements are
made. Microchip does not undertake any obligation to publicly update
any forward-looking statements to reflect events, circumstances or new
information after this January 24, 2008 press release, or to reflect the
occurrence of unanticipated events.
About
Microchip:
Microchip
Technology Incorporated is a leading provider of microcontroller and analog
semiconductors, providing low-risk product development, lower total system
cost
and faster time to market for thousands of diverse customer applications
worldwide. Headquartered in Chandler, Arizona, Microchip offers
outstanding technical support along with dependable delivery and
quality. For more information, visit the Microchip Web site at www.microchip.com.
The
Microchip name and logo, PIC, and dsPIC are registered trademarks of Microchip
Technology Inc. in the USA and other countries. PICtail is a
trademark of
Microchip
Technology Inc. All other trademarks mentioned herein are the
property of their respective companies.
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