DGAP-News: Infineon Technologies AG / Key word(s): Quarter Results
Infineon reports results for the first quarter and provides outlook
for the second quarter and the 2011 fiscal year
01.02.2011 / 07:30
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1Q 2011 RESULTS: SUCCESS STORY CONTINUES WITH RECORD 19.2 PERCENT TOTAL
SEGMENT RESULT MARGIN ON REVENUE FROM CONTINUING OPERATIONS OF EURO 922
MILLION
QUARTERLY REVENUE DOWN 2 PERCENT SEQUENTIALLY LARGELY DUE TO CURRENCY
EFFECTS
TOTAL SEGMENT RESULT OF EURO 177 MILLION, A 4 PERCENT INCREASE FROM PRIOR
QUARTER
2Q 2011 OUTLOOK: REVENUE EXPECTED TO BE UP SLIGHTLY, TOTAL SEGMENT RESULT
MARGIN BETWEEN 18 AND 20 PERCENT
FY 2011 OUTLOOK RAISED: MID-TEENS REVENUE GROWTH WITH HIGH TEENS TOTAL
SEGMENT RESULT MARGIN
FIRST QUARTER 2010 RESULTS (October 1 to December 31, 2010)
|[![CDATA[|[pre|]]]|]
in Euro million Q1 FY11 Q4 FY10 +/-
Revenue 922 942 (2)
Total Segment Result 177 171 4
Total Segment Result Margin [in %] 19.2% 18.2%
Income (loss) from continuing operations 149 193 (23)
Income from discontinued operations, net of
income taxes 83 197 (58)
Net income 232 390 (41)
in Euro
Basic earnings (loss) per share from continuing 0.14 0.18 (22)
operations
Basic earnings (loss) per share from discontinued 0.07 0.18 (61)
operations
Basic earnings per share 0.21 0.36 (42)
Diluted earnings (loss) per share from continuing 0.13 0.16 (19)
operations
Diluted earnings (loss) per share from 0.07 0.17 (59)
discontinued operations
Diluted earnings per share 0.20 0.33 (39)
|[![CDATA[|[/pre|]]]|]
Neubiberg, Germany - February 1, 2011 - Infineon Technologies AG (FSE: IFX
/ OTCQX: IFNNY) today reported results for the first quarter of the 2011
fiscal year, ended December 31, 2010.
'In the first fiscal quarter, we continued with the excellent performance
of the 2010 fiscal year. Going forward, we expect to grow faster than the
market and see another quarter of revenue growth with consistently high
margins. This confirms once again, that targeting less volatile,
high-margin markets, driven by the worldwide trends towards more energy
efficiency, mobility and security is the right strategy for Infineon', says
Peter Bauer, CEO of Infineon Technologies AG.
FISCAL FIRST QUARTER 2011 REVIEW: RECORD TOTAL SEGMENT RESULT MARGIN WITH
SALES DECLINING LARGELY DUE TO FOREIGN EXCHANGE IMPACT
Infineon's revenues in the first quarter of the 2011 fiscal year were Euro
922 million, down two percent compared to the fourth quarter of the 2010
fiscal year. On a constant currency basis, total sales for the first
quarter were flat with the fourth quarter of the previous fiscal year.
First quarter Total Segment Result was Euro 177 million, an increase of
four percent compared to Euro 171 million in the prior quarter. Total
Segment Result margin in the first quarter reached 19.2 percent, up from
18.2 percent in the fourth quarter. Total Segment Result margin marked an
all-time-high on a comparable basis.
Infineon reported income from continuing operations of Euro 149 million,
down from Euro 193 million in the fourth quarter. The decline occurred
mainly because income taxes in the fourth quarter of the 2010 fiscal year
contained a non-recurring benefit of Euro 69 million from recording a
deferred tax asset. Basic earnings per share from continuing operations
were Euro 0.14, down from Euro 0.18 in the previous quarter. Diluted
earnings per share from continuing operations were Euro 0.13 versus Euro
0.16 in the preceding quarter.
Income from discontinued operations, net of income taxes, was Euro 83
million for the first quarter, down from Euro 197 million in the preceding
quarter. Net income from discontinued operations decreased as income from
discontinued operations in the fourth quarter of the 2010 fiscal year
contained a non-recurring benefit from recording a Euro 82 million deferred
tax asset related to the expected gain on the sale of the Wireless mobile
phone business and as the first quarter result of the 2011 fiscal year
contained a negative valuation impact of foreign exchange options used to
hedge the proceeds from the divestiture of Infineon's Wireless mobile phone
business of Euro 32 million.
Net income for the group was Euro 232 million in the first quarter, a
decrease from Euro 390 million in the previous quarter. First quarter basic
earnings per share were Euro 0.21 and diluted earnings per share were Euro
0.20, down from Euro 0.36 and Euro 0.33, respectively, for basic and
diluted EPS in the fourth quarter of 2010 fiscal year.
Working capital amounted to negative Euro 71 million at the end of the
first quarter, but deteriorated from negative Euro 130 million at the end
of the prior quarter, mainly due to lower provisions and higher
inventories. Of the increase in inventories from Euro 514 million at the
end of the prior quarter to Euro 573 million at the end of the first
quarter of the 2011 fiscal year, an amount of approximately Euro 20 million
is related to the closing of the divestiture of the Wireless mobile phone
business. The company also recorded an increase in work-in-progress in
anticipation of higher revenues going forward.
Investments from continuing operations, which the company defines as the
sum of purchases of property, plant and equipment, purchases of intangible
assets and capitalized research & development (R&D) assets, were Euro 131
million in the first quarter of the 2011 fiscal year, compared to Euro 163
million in the prior quarter. Depreciation and amortization was Euro 83
million, down from Euro 85 million in the fourth quarter of the 2010 fiscal
year. Free cash flow from continuing operations for the first quarter was
Euro 4 million, down from Euro 236 million in the fourth quarter of the
2010 fiscal year.
FULLY DILUTED SHARE COUNT DOWN BY A FULL PERCENTAGE POINT AS INFINEON
BUYS-BACK ITS 2014 CONVERTIBLE
As of December 31, 2010, the company's gross cash position stood at Euro
1,669 million with a net cash position of Euro 1,293 million, down from
Euro 1,727 million and Euro 1,331 million, respectively, as of September
30, 2010. Both decreased primarily due to the repurchase of a nominal Euro
28 million of the company's 2014 convertible bond for cash of Euro 80
million. Through the repurchase, Infineon reduced the fully diluted share
count by a full percentage point.
INFINEON IS TAKING LEGAL ACTION AGAINST QIMONDA'S INSOLVENCY ADMINISTRATOR
Infineon Technologies AG has brought a declaratory action in District Court
Munich I against Dr. Michael Jaffé, the insolvency administrator dealing
with the bankruptcy estate of Qimonda AG.
When Infineon's memory business was carved out to form Qimonda AG in 2006,
Infineon transferred, among other things, patents and other intellectual
property rights to the Qimonda Group. At the same time, Infineon retained
rights of use to these patents and other intellectual property rights,
secured the same for its licensees, and reached agreements with the Qimonda
Group on licenses to future intellectual property rights. Qimonda's
insolvency administrator, however, asserts that, as a result of the
insolvency of Qimonda AG, these rights of use no longer apply.
The purpose of the legal action is for the court to determine that
Infineon's and its licensees' rights to the aforementioned intellectual
property rights of the Qimonda Group remain valid. Prior to bringing this
action, Infineon negotiated intensively with the insolvency administrator
with a view to resolving the differences of opinion out of court. However,
as these efforts have failed to produce an amicable settlement, it is now
in the interests of Infineon and its licensees that the legal issues in
dispute are settled in court through the legal action brought today.
Besides claiming that the aforementioned rights of use no longer apply, the
insolvency administrator, as noted in Infineon's Annual Report for fiscal
2010, has also sought to assert various claims against Infineon: In
connection with (i) Infineon's earlier position as a shareholder of Qimonda
Dresden GmbH & Co. ohG, (ii) Qimonda's sale of its interest in Inotera to
Micron, and (iii) the allegation that Infineon utilized a previously formed
shell company and 'economically reestablished' that company through the
transfer of the memory business; regarding the topic the administrator has,
as reported, brought declaratory action against Infineon.. A detailed
account of the issues, risks and liabilities involved in Qimonda AG's
insolvency is given in the Notes to the Consolidated Financial Statements
in Infineon's Annual Report 2010 (Note 6 - Disposals and Discontinued
Operations, and Note 38 - Litigation and Government Inquiries).
Provisions formed by Infineon at December 31, 2010, in connection with the
Qimonda insolvency total Euro 104 million. This figure includes a sum set
aside by the company based on the positions taken in the settlement
negotiations - a sum which the company will continue to increase in
forthcoming quarters and which, from today's perspective, is estimated to
amount to a total future charge against earnings of Euro 80 million.
Infineon will continue to defend itself resolutely against the claims being
made and will draw, as necessary, on all legal remedies available.
Nonetheless, the company remains open to finding a settlement with the
insolvency administrator in respect of all of the claims he has advanced so
that a conclusive solution can be found to all of the issues at stake.
OUTLOOK FOR THE SECOND QUARTER OF THE 2011 FISCAL YEAR: A QUARTER OF
REVENUE GROWTH WITH CONSISTENTLY HIGH MARGINS
Infineon expects revenues for the second quarter of the 2011 fiscal year to
be up slightly compared to the first quarter, with Total Segment Result
margin of 18 to 20 percent.
Within the expected sequential revenue increase, Automotive (ATV) revenues
are expected to grow markedly, Chip Card & Security (CCS) turnover should
show some growth and Industrial & Multimarket (IMM) sales are expected to
increase only slightly.
OUTLOOK FOR THE FISCAL YEAR 2011: RAISING ANTICIPATED GROWTH AND MARGIN
Even at an assumed Euro/U.S. Dollar exchange rate of 1.40, Infineon now
expects full-year revenue growth to be a mid-teens percentage, compared to
a rate of close to 10 percent guided for so far. Within this outlook, the
company anticipates greater than group average growth for both ATV and IMM
and below group average growth for CCS revenues.
Total Segment Result margin for the 2011 fiscal year is expected to be a
high teens percentage of sales, compared to a mid to high teens percentage
guided for thus far.
In response to continued high levels of order intake and sustained
allocation across multiple product lines, Infineon now anticipates that
investments will total around Euro 700 million in the 2011 fiscal year,
compared to the previous guidance of Euro 550 million and compared to Euro
325 million in the 2010 fiscal year.
Depreciation and Amortization is now expected to slightly exceed Euro 400
million for the 2011 fiscal year, compared to Euro 336 million in the 2010
fiscal year and compared to the previous guidance of about Euro 400
million.
Infineon segments' performance in the first quarter of the 2011 fiscal year
can be found in the quarterly information at http://www.infineon.com.
All figures in this quarterly information are preliminary and unaudited.
ANALYST AND PRESS TELEPHONE CONFERENCES
Infineon Technologies AG will conduct a telephone conference (in English
only) with analysts and investors on February 1, 2011, at 10:00 a.m.
Central European Time (CET), 4:00 a.m. Eastern Standard Time (U.S. EST), to
discuss operating performance during the first quarter of the 2011 fiscal
year. In addition, the Infineon Management Board will host a telephone
conference with the media at 11:30 a.m. (CET), 5:30 a.m. (U.S. EST). It can
be followed in German and English over the Internet. Both conferences will
be available live and for download on the Infineon web site at
http://corporate.infineon.com.
IFX FINANCIAL CALENDAR (*preliminary date)
- Feb 17, 2011 2011 Annual General Meeting of Shareholders
- May 3, 2011* Earnings Release for the Second Quarter of the 2011
Fiscal Year
- Jul 28, 2011* Earnings Release for the Third Quarter of the 2011
Fiscal Year
- Nov 17, 2011* Earnings Release for the Fourth Quarter and Full 2011
Fiscal Year
ABOUT INFINEON
Infineon Technologies AG, Neubiberg, Germany, offers semiconductor and
system solutions addressing three central challenges to modern society:
energy efficiency, mobility, and security. In the 2010 fiscal year (ending
September 30), the company reported sales of Euro 3.295 billion with
approximately 26,650 employees worldwide. With a global presence, Infineon
operates through its subsidiaries in the U.S. from Milpitas, CA, in the
Asia-Pacific region from Singapore, and in Japan from Tokyo. Infineon is
listed on the Frankfurt Stock Exchange (ticker symbol: IFX) and in the USA
on the over-the-counter market OTCQX International Premier (ticker symbol:
IFNNY).
D I S C L A I M E R
This press release includes forward-looking statements and assumptions
about the future of Infineon's business and the industry in which we
operate. These include statements and assumptions relating to general
economic conditions, future developments in the world semiconductor market,
our ability to manage our costs and to achieve our savings and growth
targets, the resolution of Qimonda's insolvency proceedings and the
liabilities we may face as a result of Qimonda's insolvency, the benefits
of research and development alliances and activities, our planned levels of
future investment, the introduction of new technology at our facilities,
our ability to continue to offer commercially viable products, and our
expected or projected future results.
These forward-looking statements are subject to a number of uncertainties,
including broader economic developments, trends in demand and prices for
semiconductors generally and for our products in particular, as well as for
the end-products that incorporate our products, the success of our
development efforts, both alone and with partners; the success of our
efforts to introduce new production processes at our facilities, the
actions of competitors; the continued availability of adequate funds, the
outcome of antitrust investigations and litigation matters, and the outcome
of Qimonda's insolvency proceedings, as well as the other factors mentioned
in this press release.
As a result, Infineon's actual results could differ materially from those
contained in these forward-looking statements. You are cautioned not to
place undue reliance on these forward-looking statements. Infineon does not
undertake any obligation to publicly update or revise any forward-looking
statements in light of developments which differ from those anticipated.
End of Corporate News
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Language: English
Company: Infineon Technologies AG
Am Campeon 1-12
85579 Neubiberg
Deutschland
Phone: +49 (0)89 234-26655
Fax: +49 (0)89 234-955 2987
E-mail: investor.relations@infineon.com
Internet: www.infineon.com
ISIN: DE0006231004
WKN: 623100
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover,
München, Stuttgart; Terminbörse EUREX
End of News DGAP News-Service
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110615 01.02.2011
DGAP-News: Infineon reports results for the first quarter and provides outlook for the second quarter and the 2011 fiscal year
| Source: EQS Group AG