EXHIBIT 99.1
Published on November 4, 2009
 |
EXHIBIT
99.1
NEWS
RELEASE
INVESTOR
RELATIONS CONTACTS:
J.
Eric Bjornholt – CFO (480) 792-7804
Gordon
Parnell – Vice President of Business Development
and Investor
Relations (480) 792-7374
|
MICROCHIP
TECHNOLOGY EXCEEDS FINANCIAL GUIDANCE
FOR
THE SECOND FISCAL QUARTER 2010
|
·
|
Net
sales of $226.7 million, up 17.5%
sequentially
|
|
·
|
highest
sequential growth in 15 years
|
|
·
|
On
a GAAP basis:
|
|
·
|
Gross
margin of 54.4%; Operating profit of 23.3%; Net income of $44.5 million
and 19.6% of net sales; EPS of 24 cents per diluted
share
|
|
·
|
On
a non-GAAP basis:
|
|
·
|
Gross
margin of 55.5%; Operating profit of 27.8%; Net income of $53.2 million
and 23.5% of net sales; EPS of 29 cents per diluted
share
|
|
·
|
Days
of inventory reduced by 12 days sequentially, to 96
days
|
|
·
|
Record
shipments of 38,086 development
tools
|
|
·
|
Increased
quarterly dividend to 34 cents per
share
|
CHANDLER,
Arizona – November 4, 2009 – (NASDAQ: MCHP) – Microchip Technology Incorporated,
a leading provider of microcontroller and analog semiconductors, today reported
results for the three months ended September 30, 2009 as summarized in the
following table:
|
GAAP
|
%
of
Revenue
|
Non-GAAP1
|
%
of
Revenue
|
|
|
Revenue
|
$226.7
million
|
$226.7
million
|
||
|
Gross
Margin
|
$123.3
million
|
54.4%
|
$125.8
million
|
55.5%
|
|
Operating
Income
|
$52.7
million
|
23.3%
|
$63.1
million
|
27.8%
|
|
Other
Income (Expense)
|
($1.4)
million
|
($2.0)
million
|
||
|
Income
Tax Expense
|
$6.8
million
|
$7.9
million
|
||
|
Net
Income
|
$44.5
million
|
19.6%
|
$53.2
million
|
23.5%
|
|
Earnings
per Diluted Share
|
24
cents
|
29
cents
|
|
1
|
See
the “Use of Non-GAAP Financial Measures” section of this
release.
|
- - more -
- -
Microchip
Technology Incorporated 2355 West Chandler Blvd. Chandler, AZ
85224-6199 Main Office 480•792•7200 FAX
480•899•9210
Microchip
Technology
Reports
Second Quarter
Fiscal
2010 Results
Net sales
for the second quarter of fiscal year 2010 were $226.7 million, up 17.5%
sequentially from net sales of $192.9 million in the immediately preceding
quarter, and down approximately 16% from net sales of $269.7 million in the
prior year’s second fiscal quarter. GAAP net income for the second
quarter of fiscal year 2010 was $44.5 million, or 24 cents per diluted share, up
62.5% from GAAP net income of $27.4 million, or 15 cents per diluted share, in
the immediately preceding quarter, and down 41.3% from GAAP net income of $75.7
million, or 40 cents per diluted share, in the prior year’s second fiscal
quarter.
Non-GAAP
net income for the second quarter of fiscal year 2010 was $53.2 million, or 29
cents per diluted share, up 51.9% from non-GAAP net income of $35 million, or 19
cents per diluted share, in the immediately preceding quarter, and down 36.3%
from non-GAAP net income of $83.5 million, or 45 cents per diluted share, in the
prior year’s second fiscal quarter. Our non-GAAP results exclude the
effect of share-based compensation, any gain or loss on trading securities, the
impact of our acquisition activities and non-cash interest expense on our
convertible debentures associated with the adoption of the Financial Accounting
Standards Board’s Accounting Standards Codification Subtopic 470-20, Debt with Conversion and Other
Options – Cash Conversion, which requires us to account separately for
the liability and equity components of certain convertible debt instruments in a
manner that reflects our nonconvertible debt (unsecured debt) borrowing rate
when interest cost is recognized. A reconciliation of our non-GAAP
and GAAP results is included in this press release.
Microchip
also announced today that its Board of Directors declared a quarterly cash
dividend on its common stock of 34 cents per share. The quarterly
dividend is payable on December 2, 2009 to stockholders of record on November
18, 2009. Microchip initiated quarterly cash dividend payments in the
third quarter of fiscal 2003.
“During
the September quarter we experienced strength in all geographies and product
lines, allowing us to exceed our revenue, gross margin and earnings per share
guidance that we revised positively in early September,” said Steve Sanghi,
Microchip’s President and CEO.
“We
achieved GAAP gross margins of 54.4% and non-GAAP gross margins of
55.5%. Non-GAAP gross margins were up over 400 basis points from the
June quarter, and we expect another 150 to 200 basis points of gross margin
improvement in the December quarter as we continue to increase production levels
in our factories in response to improving business conditions,” continued Mr.
Sanghi.
-
- - more - -
Microchip
Technology
Reports
Second Quarter
Fiscal
2010 Results
“Our
microcontroller business delivered excellent results and revenue was up 16.6%
sequentially, and we shipped a record 38,086 development tools. Our
16-bit microcontrollers posted a very strong sequential revenue growth of 49.1%,
as well as a 70.3% growth from the year-ago quarter,” said Ganesh Moorthy, Chief
Operating Officer. “Our analog business executed on all fronts and
revenue grew an exceptional 25.5% sequentially.”
Eric
Bjornholt, Microchip’s Chief Financial Officer, said, “Inventory levels on
Microchip’s balance sheet decreased by $5.4 million in the September quarter
compared to the June quarter. Inventory days declined from 108 days
at June 30, 2009 to 96 days at September 30, 2009. Days of inventory
at our distributors remained flat to the June quarter levels. We have
aggressively increased our manufacturing output so that we can continue to meet
the needs of our customers.”
Mr.
Bjornholt continued, “In the September quarter our cash, short-term and
long-term investment position increased by $34.6 million after payment of our
quarterly cash dividend of $62.1 million. We expect our cash
generation to remain strong for the balance of fiscal year 2010.”
Mr.
Sanghi concluded, “We are extremely pleased with the performance of our business
and excellent execution by our employees. Our book-to-bill ratio for
the September quarter was 1.15, resulting in our opening backlog position for
the December quarter being significantly higher than our backlog entering the
September quarter. While there are fewer shipping days in Europe and the
Americas this quarter, based on the improved visibility and general business
conditions, we expect revenue to be up 4% to 8% sequentially.”
Microchip’s Recent
Highlights:
|
·
|
During
the quarter, Microchip shipped 38,086 development systems, a new record
that demonstrates the continued strong interest in Microchip’s products in
the face of a tough economy. The total cumulative number of
development systems shipped now stands at
843,010.
|
|
·
|
8-bit
microcontroller innovation continued at a brisk pace this quarter, with
Microchip’s first PIC®
microcontroller family to feature its enhanced Mid-range 8-bit
core. The family’s increased memory and core capabilities
deliver enhanced support for both C and Assembly programmers, and “LF”
family members feature Microchip’s nanoWatt XLP technology—for extreme low
power consumption—enabling designs to achieve world-leading battery
lifetime.
|
--more--
Microchip
Technology
Reports
Second Quarter
Fiscal
2010 Results
|
·
|
Microchip
expanded the family of 8-bit PIC18 ‘K’ devices that feature nanoWatt XLP
technology, adding 5V operation. The PIC18F87J93 8-bit family
was also introduced, with direct-drive LCD, and enhanced analog and
capacitive-touch-sensing peripherals for medical and metering
applications.
|
|
·
|
Growth
for the nanoWatt XLP portfolio of eXtreme Low Power PIC microcontrollers
also continued among Microchip’s 16-bit families. The new
PIC24F04KA201 family combines 20 nA sleep currents and small packages at
less than $.99 each in high volume.
|
|
·
|
Adding
to Microchip’s comprehensive portfolio of mTouch™ capacitive and inductive
touch-sensing solutions, the new AR1000 controllers are the embedded
industry’s most innovative analog resistive touch-screen controllers;
further solidifying Microchip’s position as the broadest touch-sensing
solutions provider in the semiconductor
industry.
|
|
·
|
Microchip
enhanced its connectivity capabilities with low-cost, standalone, IEEE
802.3™ compliant, 100 Mbps Ethernet interface controllers that can connect
to nearly any microcontroller via an industry-standard Serial Peripheral
Interface (SPI) or a flexible parallel
interface.
|
|
·
|
The
Company’s broad analog and interface portfolio also continued to expand at
a rapid pace, including the industry’s first 12-bit Quad Digital-to-Analog
Converter (DAC) to feature non-volatile EEPROM, which enables the DAC’s
configuration to be loaded automatically at startup. Microchip
also introduced single- and dual-cell Li-Ion & LiFePO4 battery
chargers with over-voltage protection to enable safer, longer-lasting
portable devices.
|
|
·
|
New
development tools included free uninterruptable power-supply and
power-factor-correction reference designs, using Microchip’s dsPIC33 GS
series of digital-power-conversion DSCs; a new starter kit for the PIC18
portfolio of high-performance 8-bit microcontrollers; and new boards and
software tools for designing graphics displays using PIC
microcontrollers. Microchip is also running its own “cash for
clunkers” program, where competitor’s tools can be exchanged for a
discount on Microchip’s most popular development
systems.
|
-
- - more - -
Microchip
Technology
Reports
Second Quarter
Fiscal
2010 Results
|
·
|
While
some other companies have been slashing their customer training budgets
and cancelling annual conferences, Microchip added the new Embedded
Designer’s Forums, a worldwide series of technical learning events focused
on innovative technologies that will help designers stay ahead in today’s
competitive environment. The forums are running from October
2009 through February 2010 at 120 locations across North America, Europe,
South Africa, Australia, New Zealand, China, Japan, Taiwan, Korea, ASEAN
and India.
|
Third Quarter Fiscal 2010
Outlook:
The
following statements are based on current expectations. These
statements are forward-looking, and actual results may differ
materially.
|
GAAP
|
Non-GAAP
Adjustments
|
Non-GAAP1
|
|
|
Revenue
|
$236
to $245 million
|
$236
to $245 million
|
|
|
Gross
Margin2
|
56.2%
to 56.7%
|
$1.6
to $1.8 million
|
57%
to 57.5%
|
|
Operating
Expenses2
|
30.1%
to 30.3%
|
$8.0
to $8.2 million
|
26.8%
to 27.0%
|
|
Other
Income (Expense)
|
($2.7)
to ($2.9) million
|
$1.6
million
|
($1.1)
to ($1.3) million
|
|
Tax
Rate
|
12.1%
to 12.5%
|
$1.8
to $2.0 million
|
12.8%
to 13.2%
|
|
Diluted
Common Shares
Outstanding3
|
187.5
to 188.3 million
|
1.7
million shares
|
185.8
to 186.6 million
|
|
Earnings
per Share
|
27
to 29 cents
|
5
to 6 cents
|
33
to 35 cents
|
|
·
|
Inventory
is expected to grow between 6 and 12 days from September 30, 2009, while
remaining below our internal target of 115
days.
|
|
·
|
Capital
expenditures for the quarter ending December 31, 2009 are expected to be
approximately $20 million. Capital expenditures for all of
fiscal year 2010 are anticipated to be approximately $35
million. We are investing in equipment to support the expected
revenue growth of our new products and technologies and plan to take
advantage of low-cost equipment opportunities in the
marketplace.
|
|
·
|
We
expect net cash generation during the December quarter of approximately
$65 to $75 million before the dividend payment of $62.3 million announced
today. The amount of expected net cash generation is before the
effect of any stock buy back
activity.
|
--more--
Microchip
Technology
Reports
Second Quarter
Fiscal
2010 Results
|
·
|
Microchip’s
Board of Directors authorized a stock buy back of up to 10.0 million
shares in December 2007. At March 31, 2009, approximately 2.5
million shares remained available for purchase under this
program. Future purchases will depend upon market conditions,
interest rates and corporate
considerations.
|
Calendar Year 2010 Internal
Plan:
In order
to provide more insight into our business, Microchip is providing information
about our internal plan for calendar year 2010. It reflects the
results we expect from our multi-year demand creation activity that has
generated a large number of new designs. Many of these designs are
with new customers in emerging markets and applications that are outside our
traditional core areas, which we believe will result in increased market
share.
|
Calendar
Year 2010 Internal Plan
|
GAAP
|
Non-GAAP1
|
|
Revenue
|
$1.05
billion
|
$1.05
billion
|
|
Gross
Margin2
|
57.7%
|
58.5%
|
|
Operating
Expenses2
|
29.6%
|
26.7%
|
|
Operating
Profit
|
28.1%
|
31.8%
|
|
Earnings
Per Share
|
$1.29
|
$1.50
|
|
1
|
Use of Non-GAAP
Financial Measures:
|
Our
Non-GAAP adjustments, where applicable, include the effect of share-based
compensation, any gain or loss on trading securities, the impact of our recent
acquisition activities and non-cash interest expense on our convertible
debentures and the related income tax implications of these items.
We are
required to estimate the cost of certain forms of share-based compensation,
including employee stock options, restricted stock units and our employee stock
purchase 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 the price of our
stock at the date of grant. The price of our stock is affected by
market forces that are difficult to predict and are not within the control of
management. The value of our trading securities varies in amount from
period to period and is affected by fluctuations in the market prices of such
securities that we cannot predict and are not within the control of
management. The non-GAAP adjustments related to the impact of our
acquisitions and a portion of our interest expense related to our convertible
debentures are non-cash expenses related to such transactions. Our
acquisitions of patent portfolio licenses are non-recurring events in our
business. Accordingly, management excludes all of these items from
its internal operating forecasts and models.
-- more --
Microchip
Technology
Reports
Second Quarter
Fiscal
2010 Results
We are
using non-GAAP gross profit, non-GAAP research and development expenses,
non-GAAP selling, general and administration expenses, non-GAAP operating
income, non-GAAP other income (expense), non-GAAP income tax expense/tax
rate, non-GAAP net income, and non-GAAP diluted earnings per share which exclude
the items noted in the immediately preceding paragraph, 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 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 such items when developing
and monitoring our budgets and spending. As described above the
economic substance behind our decision to exclude such items relates either to
these charges being non-cash in nature or to the one-time nature of the events
or, in the case of our trading securities, because such item is difficult to
predict and not within the control of management. 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 amounts 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.
|
2
|
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;
inventory reserves; pricing pressures in our non-proprietary product
lines; and competitive and economic conditions. Operating
expenses fluctuate over time, primarily due to revenue and profit
levels.
|
|
3
|
Diluted
Common Shares Outstanding can vary for, among other things, the trading
price of our common stock, the actual exercise of options or vesting of
restricted stock units, the potential for incremental dilutive shares from
our convertible debentures, and the repurchase or the issuance of stock or
the sale of treasury shares.
|
-
- - more - -
|
MICROCHIP
TECHNOLOGY INCORPORATED AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
||||||||||||||||
|
(in
thousands, except per share amounts)
(Unaudited)
|
||||||||||||||||
|
Three
Months Ended
September 30,
|
Six
Months Ended
September 30,
|
|||||||||||||||
|
2009
|
2008
(1)
|
2009
|
2008
(1)
|
|||||||||||||
|
Net
sales
|
$ | 226,661 | $ | 269,706 | $ | 419,610 | $ | 537,878 | ||||||||
|
Cost
of sales
|
103,321 | 105,553 | 199,835 | 210,128 | ||||||||||||
|
Gross profit
|
123,340 | 164,153 | 219,775 | 327,750 | ||||||||||||
|
Operating
expenses:
|
||||||||||||||||
|
Research and
development
|
29,568 | 31,343 | 57,204 | 62,895 | ||||||||||||
|
Selling, general and
administrative
|
41,046 | 45,629 | 77,429 | 91,042 | ||||||||||||
|
Special charge
|
- | - | 1,238 | - | ||||||||||||
| 70,614 | 76,972 | 135,871 | 153,937 | |||||||||||||
|
Operating
income
|
52,726 | 87,181 | 83,904 | 173,813 | ||||||||||||
|
Other
(expense) income, net
|
(1,444 | ) | 4,953 | 33 | 10,255 | |||||||||||
|
Income before
income taxes
|
51,282 | 92,134 | 83,937 | 184,068 | ||||||||||||
|
Income
tax provision
|
6,797 | 16,414 | 12,084 | 32,801 | ||||||||||||
|
Net
income
|
$ | 44,485 | $ | 75,720 | $ | 71,853 | $ | 151,267 | ||||||||
|
Basic
net income per share
|
$ | 0.24 | $ | 0.41 | $ | 0.39 | $ | 0.82 | ||||||||
|
Diluted
net income per share
|
$ | 0.24 | $ | 0.40 | $ | 0.39 | $ | 0.80 | ||||||||
|
Basic
shares used in calculation
|
183,190 | 183,615 | 183,023 | 184,139 | ||||||||||||
|
Diluted
shares used in calculation
|
186,922 | 187,936 | 186,224 | 189,493 | ||||||||||||
|
(1)
|
As
adjusted due to the adoption of ASC Subtopic 470-20, Debt with Conversion and Other
Options – Cash Conversion.
|
-
- - more - -
|
MICROCHIP
TECHNOLOGY INCORPORATED AND SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
||||||||
|
(in
thousands)
|
||||||||
|
ASSETS
|
||||||||
|
September
30,
|
March
31,
|
|||||||
|
2009
|
2009
(1)
|
|||||||
|
(Unaudited)
|
||||||||
|
Cash
and short-term investments
|
$
|
1,363,994
|
$
|
1,389,945
|
||||
|
Accounts
receivable, net
|
106,651
|
88,525
|
||||||
|
Inventories
|
108,451
|
131,510
|
||||||
|
Other
current assets
|
148,360
|
138,864
|
||||||
|
Total current
assets
|
1,727,456
|
1,748,844
|
||||||
|
Property,
plant & equipment, net
|
497,958
|
531,687
|
||||||
|
Long-term
investments
|
108,729
|
50,826
|
||||||
|
Other
assets
|
84,142
|
80,409
|
||||||
|
Total assets
|
$
|
2,418,285
|
$
|
2,411,766
|
||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
|
Accounts
payable and other accrued liabilities
|
$
|
84,089
|
$
|
71,714
|
||||
|
Deferred
income on shipments to distributors
|
86,261
|
83,931
|
||||||
|
Total current
liabilities
|
170,350
|
155,645
|
||||||
|
Convertible
debentures
|
337,403
|
334,184
|
||||||
|
Long-term
income tax payable
|
75,522
|
70,051
|
||||||
|
Deferred
tax liability
|
372,700
|
365,734
|
||||||
|
Other
long-term liabilities
|
3,993
|
3,834
|
||||||
|
Stockholders'
equity
|
1,458,317
|
1,482,318
|
||||||
|
Total liabilities and
stockholders' equity
|
$
|
2,418,285
|
$
|
2,411,766
|
||||
|
|
||||||||
|
(1)
As adjusted due to the adoption of ASC Subtopic 470-20, Debt with Conversion and Other
Options – Cash Conversion.
|
||||||||
-
- - more - -
MICROCHIP
TECHNOLOGY INCORPORATED AND SUBSIDIARIES
RECONCILIATION
OF GAAP TO NON-GAAP MEASURES
(Unaudited)
(in
thousands except per share amounts and percentages)
RECONCILIATION
OF GROSS PROFIT TO NON-GAAP GROSS PROFIT
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
|
September
30,
|
September
30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Gross
profit, as reported
|
$ | 123,340 | $ | 164,153 | $ | 219,775 | $ | 327,750 | ||||||||
|
Share-based
compensation expense
|
1,869 | 2,053 | 3,579 | 3,678 | ||||||||||||
|
Acquisition-related
acquired inventory valuation costs and intangible asset
amortization
|
580 | - | 1,547 | - | ||||||||||||
|
Non-GAAP
gross profit
|
$ | 125,789 | $ | 166,206 | $ | 224,901 | $ | 331,428 | ||||||||
|
Non-GAAP
gross profit percentage
|
55.5 | % | 61.6 | % | 53.6 | % | 61.6 | % | ||||||||
RECONCILIATION
OF RESEARCH AND DEVELOPMENT EXPENSES TO NON-GAAP
RESEARCH
AND DEVELOPMENT EXPENSES
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
|
September
30,
|
September
30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Research
and development expenses, as reported
|
$ | 29,568 | $ | 31,343 | $ | 57,204 | $ | 62,895 | ||||||||
|
Share-based
compensation expense
|
(3,108 | ) | (2,640 | ) | (6,097 | ) | (5,075 | ) | ||||||||
|
Non-GAAP
research and development expenses
|
$ | 26,460 | $ | 28,703 | $ | 51,107 | $ | 57,820 | ||||||||
|
Non-GAAP
research and development expenses as a percentage of net
sales
|
11.7 | % | 10.6 | % | 12.2 | % | 10.7 | % | ||||||||
RECONCILIATION
OF SELLING, GENERAL AND ADMINISTRATIVE EXPENSES TO
NON-GAAP
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
|
September
30,
|
September
30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Selling,
general and administrative expenses, as reported
|
$ | 41,046 | $ | 45,629 | $ | 77,429 | $ | 91,042 | ||||||||
|
Share-based
compensation expense
|
(4,523 | ) | (3,800 | ) | (8,822 | ) | (7,439 | ) | ||||||||
|
Acquisition-related
intangible asset amortization and other costs
|
(255 | ) | - | (563 | ) | - | ||||||||||
|
Non-GAAP
selling, general and administrative expenses
|
$ | 36,268 | $ | 41,829 | $ | 68,044 | $ | 83,603 | ||||||||
|
Non-GAAP
selling, general and administrative expenses as a percentage of net
sales
|
16.0 | % | 15.5 | % | 16.2 | % | 15.5 | % | ||||||||
-
- - more - -
RECONCILIATION
OF OPERATING INCOME TO NON-GAAP OPERATING INCOME
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
|
September
30,
|
September
30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Operating
income, as reported
|
$ | 52,726 | $ | 87,181 | $ | 83,904 | $ | 173,813 | ||||||||
|
Share-based
compensation expense
|
9,500 | 8,493 | 18,498 | 16,192 | ||||||||||||
|
Acquisition-related
acquired inventory valuation costs, intangible asset amortization &
other costs
|
835 | - | 2,110 | - | ||||||||||||
|
Special
charge - patent license
|
- | - | 1,238 | - | ||||||||||||
|
Non-GAAP
operating income
|
$ | 63,061 | $ | 95,674 | $ | 105,750 | $ | 190,005 | ||||||||
|
Non-GAAP
operating income as a percentage of net sales
|
27.8 | % | 35.5 | % | 25.2 | % | 35.3 | % | ||||||||
RECONCILIATION
OF OTHER (EXPENSE) INCOME, NET TO NON-GAAP OTHER
(EXPENSE)
INCOME, NET
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
|
September
30,
|
September
30,
|
|||||||||||||||
|
2009
|
2008(1)
|
2009
|
2008(1)
|
|||||||||||||
|
Other
(expense) income, net, as reported
|
$ | (1,444 | ) | $ | 4,953 | $ | 33 | $ | 10,255 | |||||||
|
Convertible
debt non-cash interest expense
|
1,559 | 1,288 | 3,067 | 2,529 | ||||||||||||
|
Gain
on trading securities
|
(2,071 | ) | - | (7,518 | ) | - | ||||||||||
|
Non-GAAP
other (expense) income, net
|
$ | (1,956 | ) | $ | 6,241 | $ | (4,418 | ) | $ | 12,784 | ||||||
|
Non-GAAP
other (expense) income, net, as a percentage of net sales
|
-0.9 | % | 2.3 | % | -1.1 | % | 2.4 | % | ||||||||
RECONCILIATION
OF INCOME TAX PROVISION TO NON-GAAP INCOME TAX PROVISION
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
|
September
30,
|
September
30,
|
|||||||||||||||
|
2009
|
2008(1)
|
2009
|
2008(1)
|
|||||||||||||
|
Income
tax provision, as reported
|
$ | 6,797 | $ | 16,414 | $ | 12,084 | $ | 32,801 | ||||||||
|
Income
tax rate, as reported
|
13.3 | % | 17.8 | % | 14.4 | % | 17.8 | % | ||||||||
|
Share-based
compensation expense
|
1,235 | 1,537 | 2,405 | 2,930 | ||||||||||||
|
Acquisition-related
acquired inventory valuation costs, intangible asset amortization &
other costs
|
109 | - | 274 | - | ||||||||||||
|
Special
charge – patent license
|
- | - | 124 | - | ||||||||||||
|
Convertible
debt non-cash interest expense
|
600 | 496 | 1,181 | 974 | ||||||||||||
|
Gain
on trading securities
|
(797 | ) | - | (2,894 | ) | - | ||||||||||
|
Non-GAAP
income tax provision
|
$ | 7,944 | $ | 18,447 | $ | 13,174 | $ | 36,705 | ||||||||
|
Non-GAAP
income tax rate
|
13.0 | % | 18.1 | % | 13.0 | % | 18.1 | % | ||||||||
|
(1)As
adjusted due to the adoption of ASC Subtopic 470-20, Debt with Conversion and Other
Options – Cash Conversion.
|
-
- - more - -
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
|
Six
Months Ended
|
|||||||||||||||
|
September
30,
|
September
30,
|
|||||||||||||||
|
2009
|
2008(1)
|
2009
|
2008(1)
|
|||||||||||||
|
Net
income, as reported
|
$ | 44,485 | $ | 75,720 | $ | 71,853 | $ | 151,267 | ||||||||
|
Share-based
compensation expense, net of tax effect
|
8,265 | 6,956 | 16,093 | 13,262 | ||||||||||||
|
Acquisition-related
acquired inventory valuation costs, intangible asset amortization and
other costs, net of tax effect
|
726 | - | 1,836 | - | ||||||||||||
|
Special
charge – patent license, net of tax effect
|
- | - | 1,114 | - | ||||||||||||
|
Convertible
debt non-cash interest expense, net of tax effect
|
959 | 792 | 1,886 | 1,555 | ||||||||||||
|
Gain
on trading securities, net of tax effect
|
(1,274 | ) | - | (4,624 | ) | - | ||||||||||
|
Non-GAAP
net income
|
$ | 53,161 | $ | 83,468 | $ | 88,158 | $ | 166,084 | ||||||||
|
Non-GAAP
net income as a percentage of net sales
|
23.5 | % | 30.9 | % | 21.0 | % | 30.9 | % | ||||||||
|
Diluted
net income per share, as reported
|
$ | 0.24 | $ | 0.40 | $ | 0.39 | $ | 0.80 | ||||||||
|
Non-GAAP
diluted net income per share
|
$ | 0.29 | $ | 0.45 | $ | 0.48 | $ | 0.88 | ||||||||
|
(1)As
adjusted due to the adoption of ASC Subtopic 470-20, Debt with Conversion and Other
Options – Cash Conversion.
|
-
- - more - -
Microchip
Technology
Reports
Second Quarter
Fiscal
2010 Results
Microchip
will host a conference call today, November 4, 2009 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 November 11, 2009.
A
telephonic replay of the conference call will be available at approximately 7:00
p.m. (Eastern Time) November
4, 2009 and will remain available until 5:00 p.m. (Eastern Time) on November 11,
2009. Interested parties may listen to the replay by dialing
719-457-0820 and entering access code 6340154.
Cautionary
Statement:
The
statements in this release relating to improving business conditions, expecting
150 to 200 basis points of gross margin improvement in the December quarter,
aggressively increasing our manufacturing output so that we can continue to meet
the needs of our customers, expecting our cash generation to remain strong for
the balance of fiscal 2010, expecting revenue to be up 4% to 8% sequentially,
continued strong interest in our products, solidifying our position as the
broadest touch-sensing solutions provider, our third quarter fiscal 2010 outlook
(GAAP and Non-GAAP as applicable) for revenue, gross margin, operating expenses,
other income (expense), income tax provision/tax rate, diluted common shares
outstanding, earnings per share, inventory, capital expenditures for the
December quarter and for fiscal 2010 and net cash generation, our ability to
invest in equipment to support the expected revenue growth of our new products
and technologies, our plan to take advantage of low-cost equipment
opportunities, and our calendar year 2010 internal plan (GAAP and Non-GAAP as
applicable) for revenue, gross margin, operating expenses, operating profit and
earnings per share 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:
the strength of the economic recovery or any further weakness or unexpected
fluctuations in the U.S. and global economies, 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 and our ability
to effectively ramp our production levels; 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; the impact of any significant acquisitions that we
make; costs and outcome of any current or future tax audit or any litigation
involving
-
- - more - -
Microchip
Technology
Reports
Second Quarter
Fiscal
2010 Results
intellectual
property, customers or other issues; disruptions in our business or the
businesses of our customers or suppliers due to natural disasters, 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 November 4, 2009 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, and PIC are registered trademarks of Microchip
Technology Inc. in the USA and other countries. mTouch is a trademark
of Microchip Technology Inc. All other trademarks mentioned herein
are the property of their respective companies.
-
- - end - -