ANADIGICS Announces Second Quarter 2014 Results

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| Source: ANADIGICS, Inc.

Net Sales of $23.3 Million
GAAP EPS ($0.18); Non-GAAP EPS ($0.09)
10% sequential growth in Infrastructure revenue

WARREN, N.J., Aug. 6, 2014 (GLOBE NEWSWIRE) -- ANADIGICS, Inc. (Nasdaq:ANAD), a world leader in radio frequency (RF) solutions, reported second quarter 2014 net sales of $23.3 million, slightly above revised guidance. Revenue was flat sequentially while non-GAAP gross margins expanded 183 basis points to 12.8%.

As of June 28, 2014, cash, cash equivalents and restricted cash totaled $16.7 million, or net cash of $9.7 million, after excluding $7.0 million drawn under the Company's credit facility.

GAAP net loss for the second quarter of 2014 was $15.0 million, or ($0.18) per diluted share compared to $13.8 million, or ($0.17) in the second quarter of 2013. Non-GAAP net loss for the second quarter of 2014 was $7.8 million, or ($0.09) per share compared to $12.0 million, or ($0.14) in the second quarter of 2013.

As part of the strategic restructuring announced in June, the Company now summarizes revenue in two categories: Infrastructure and Mobile. Infrastructure is comprised of products for the following applications:  CATV, small cell, WiFi, M2M, optical and other general RF applications. Mobile is comprised of WiFi and Cellular products that primarily address the smartphone, handset and tablet markets.

"With the restructuring, ANADIGICS is better positioned to compete in infrastructure markets where our products are differentiated and we can be more selective in targeting mobile applications that are better aligned to our profitability objectives," said Ron Michels, chairman & CEO of ANADIGICS. "Combined with a significantly lower operating cost structure, we expect these changes in product focus to drive greater returns for our shareholders. Design-win traction with existing and new customers for both mobile and infrastructure applications has been strong and we are excited about the Company's transformation."

"In line with our strategic restructuring, we expect total revenue for the third quarter to decline sequentially by 18-20%, driven principally by reductions in legacy mobile," said Terry Gallagher, vice president and CFO. "We anticipate a sequential gross margin expansion of approximately 200 basis points resulting from a richer product mix and lower manufacturing costs. With our strategic restructuring actions and other improvements, we expect operating expenses to decline by more than 15%." 

The statements regarding the Company's anticipated future performance are forward looking and actual results may differ materially as described in the Safe Harbor Statement at the end of this press release.

This press release includes financial measures that are not in accordance with GAAP, consisting of non-GAAP net income and loss per share. Management uses these measures to evaluate the Company's operating and financial performance in light of business objectives, for planning purposes, when publicly providing our business outlook and to facilitate period-to-period comparisons. ANADIGICS believes that these measures are useful to investors because they enhance investors' ability to review the Company's business from the same perspective as the Company's management and facilitate comparisons of this period's results with prior periods. These non-GAAP measures exclude amounts related to stock-based compensation, marketable securities' adjustments, certain non-recurring charges to cost of goods and restructuring charges. Non-GAAP measures are used by some investors when assessing the ongoing operating and financial performance of our Company. These financial measures are not in accordance with GAAP and may differ from non-GAAP methods of accounting and reporting used by other companies. Management acknowledges that stock-based compensation is a recurring cost and is an important part of our employee's compensation and impacts their performance. However, the expense is non-cash in nature and there are various valuation methodologies and assumptions used in determining stock-based compensation that may be unrelated to operations, such as volatility and current interest rates. The presentation of the additional information should not be considered a substitute for net income or loss or income or loss per share prepared in accordance with GAAP.

Limitations of non-GAAP financial measures. The primary material limitations associated with the use of non-GAAP measures as compared to the most directly comparable GAAP financial measures are (i) they may not be comparable to similarly titled measures used by other companies in ANADIGICS' industry, and (ii) they exclude financial information that some may consider important in evaluating our performance. We compensate for these limitations by providing reconciliations of reported net income or loss and income or loss per share to non-GAAP net income or net loss and non-GAAP income or loss per share, respectively, within this press release.

Conference Call

ANADIGICS' senior management will conduct a conference call today at 5:00 PM Eastern Time. A live audio Webcast will be available at www.anadigics.com/investors. To listen to the conference via telephone, please call 866-459-1514, conference ID 75424898. A recording of the call will be available approximately two hours after the end of the call on the ANADIGICS Web site at www.anadigics.com/investors or by dialing 855-859-2056 conference ID 75424898 (available until August 13, 2014).

Recent Highlights

July 24 - Leading European Manufacturer Selects ANADIGICS GaN Line Amplifier for DOCSIS 3.1 Equipment
June 26 - ANADIGICS Announces Strategic Restructuring and Updated Q2 2014 Guidance
May 22 - ANADIGICS Expands WiFi Infrastructure Product Portfolio and Secures Design Wins at Key OEM
May 14 - ANADIGICS WiFi Solution Powers Huawei Ascend P7
May 7 - ANADIGICS Announces Multiple Design Wins at Several Chinese Smartphone OEMs

About ANADIGICS, Inc.

ANADIGICS, Inc. (ANAD) designs and manufactures innovative radio frequency solutions for the growing infrastructure and mobile markets. Headquartered in Warren, NJ, ANADIGICS offers RF products with exceptional performance and integration to deliver a unique competitive advantage to OEMs and ODMs for CATV infrastructure, CATV subscriber, small-cell, WiFi infrastructure, industrial and mobile applications. The Company's award-winning solutions include line amplifiers, upstream amplifiers, power amplifiers, front-end ICs, front-end modules, and other RF components. For more information, visit www.anadigics.com.

Safe Harbor Statement

Except for historical information contained herein, this press release contains projections and other forward-looking statements (as that term is defined in the Securities Exchange Act of 1934, as amended). These projections and forward-looking statements reflect the Company's current views with respect to future events and financial performance and can generally be identified as such because the context of the statement will include words such as "believe", "anticipate", "expect", or words of similar import. Similarly, statements that describe our future plans, objectives, estimates or goals are forward-looking statements. No assurances can be given, however, that these events will occur or that these projections will be achieved and actual results and developments could differ materially from those projected as a result of certain factors. You are cautioned that any such forward-looking statements are not guarantees of future performance and involve risk and uncertainties, as well as assumptions that if they materialize or prove incorrect, could cause results to differ materially from those expressed or implied by such forward-looking statements. Further, all statements, other than statements of historical fact, are statements that could be deemed forward-looking statements. We assume no obligation and do not intend to update these forward-looking statements, except as may be required by law. Important factors that could cause actual results and developments to be materially different from those expressed or implied by such projections and forward-looking statements include those factors detailed from time to time in our reports filed with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the year ended December 31, 2013, and those discussed elsewhere herein.

ANADIGICS, INC.
Consolidated Statements of Operations
(Amounts in thousands, except per share amounts, unaudited)
         
  Three months ended Six months ended
  June 28, 2014 June 29, 2013 June 28, 2014 June 29, 2013
         
 Net sales  $23,261 $34,565 $46,532 $60,945
 Cost of sales  22,616 34,269 43,616 61,370
 Gross profit (loss)  645 296 2,916 (425)
 Research and development expenses  7,262 9,433 15,838 19,713
 Selling and administrative expenses  4,536 6,215 9,662 12,457
 Restructuring charges   4,409  --   5,860  1,915
 Operating loss  (15,562) (15,352) (28,444) (34,510)
 Interest income  1 65 6 158
 Interest expense   (60)  (20) (93)  (20)
 Other income, net  587 1,508 1,747 1,554
 Net loss  ($15,034) ($13,799) ($26,784) ($32,818)
         
Net loss per share:        
Basic and diluted  ($0.18) ($0.17) ($0.31) ($0.42)
         
Basic and dilutive shares outstanding 85,687 83,042 85,225 78,100
         
Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures
         
 GAAP net loss  ($15,034) ($13,799) ($26,784) ($32,818)
 Stock compensation expense (excluding Restructuring charges)         
 Cost of sales  246 413 522 592
 Research and development  522 695 1,076 1,040
 Selling and administrative  588 948 1,601 1,996
 Cost of sales charge (1)  2,080  1,194  2,080  1,924
 Marketable securities redemptions and accretion (2)   (568)  (1,422)  (1,728)  (1,449)
 Restructuring charges (3)   4,409  --  5,860  1,915
 Non-GAAP net loss  ($7,757) ($11,971) ($17,373) ($26,800)
         
Non-GAAP loss per share (*):        
Basic and diluted  ($0.09) ($0.14) ($0.20) ($0.34)
         
Supplemental Information:        
Infrastructure  $10,158 $9,096 $19,385 $16,448
Mobile   13,103  25,469  27,147  44,497
Net Sales  $23,261 $34,565 $46,532 $60,945
         
Depreciation  $2,976 $3,672 $6,308 $7,499
         
(*) Calculated using related GAAP shares outstanding
         
(1) Cost of sales charge for the three and six months ended June 28, 2014 includes $2,080 inventory write-down.
Cost of sales charge for the three months ended June 29, 2013 covered $756 for customer cost reimbursement and $438 for costs from power interruptions. The six months ended June 29, 2013 also included charges for repair and product scrap from accelerated production ramp.
(2) Marketable securities adjustments include realized gains upon redemptions and interest accretion.
(3) Restructuring charges for the three months ended June 28, 2014 includes $687 workforce reduction and $3,722 fixed asset write-down.
 The six months ended June 28, 2014 further includes a $1,451 workforce restructuring charge recorded in the first quarter of 2014.
 The six months ended June 29, 2013 included $1,915 workforce reduction charge recorded in the first quarter of 2013.
 
ANADIGICS, INC.
Condensed Consolidated Balance Sheets
(Amounts in thousands)
     
  June 28, 2014 December 31, 2013 (*)
Assets Unaudited  
     
Current assets:    
Cash and cash equivalents $13,716 $20,947
Restricted cash $3,000  -- 
Marketable securities  --   3,447
Accounts receivable 11,367 15,156
Inventory 17,959 21,114
Prepaid expenses and other current assets 4,625 3,628
Assets held for sale  3,523  -- 
Total current assets 54,190 64,292
     
Plant and equipment, net 20,397 33,176
Other assets 213 213
  $74,800 $97,681
     
Liabilities and stockholders' equity    
     
Current liabilities:    
Accounts payable $8,323 $13,043
Accrued liabilities 4,017 4,380
Accrued restructuring costs  875  245
Bank borrowings  7,000  -- 
Total current liabilities 20,215 17,668
     
Other long-term liabilities 1,398 1,604
     
Stockholders' equity 53,187 78,409
  $74,800 $97,681
     
(*) The condensed balance sheet at December 31, 2013 has been derived from the audited financial statements at such date but does not include all the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.
Investor Relations

Terry Gallagher
Vice President and CFO
ANADIGICS, Inc.
141 Mt. Bethel Road
Warren, NJ  07059
Tel: +1 908 668-5000
E-mail: