Net Sales of $175.0 Million; GAAP Diluted EPS of $0.18; Gross Profit of $33.5 Million
-- Net Sales of $175.0 Million, up 6% from the previous quarter
-- Gross Profit of $33.5 Million, up 5% from the previous quarter
-- GAAP diluted EPS of $0.18, vs. $0.21 in the previous quarter
Net sales for the first quarter of fiscal 2008 were $175.0 million, up 6%
compared to $165.6 million for the fourth quarter of fiscal 2007, and down
26% compared to $237.2 million for the first quarter of fiscal 2007.
Gross profit for the first quarter of fiscal 2008 was $33.5 million, up 5%
compared to $31.8 million for the fourth quarter of fiscal 2007, and down
12% compared to $37.9 million for the first quarter of fiscal 2007.
Net income for the first quarter of fiscal 2008 was $11.5 million, or $0.18
per diluted share, compared to net income of $13.2 million, or $0.21 per
diluted share for the fourth quarter of fiscal 2007, and $14.6 million, or
$0.23 per diluted share for the first quarter of fiscal 2007.
SMART ended the first quarter of fiscal 2008 with $112.8 million in cash
and cash equivalents.
"Our results this quarter were driven by increased unit volume across
multiple end markets, in particular, high end servers, industrial and
storage," explained Iain MacKenzie, President and CEO of SMART. "The
recent decline in 1Gb component pricing is contributing to the doubling of
server module densities, and we strengthened our position in the high-end
memory module market with the introduction of three new 8GB memory module
products during the quarter, all incorporating our in-house dual-die
package (DDP) and CoolFlex foldable printed circuit board (PCB)
technologies. These industry-leading solutions are targeted for blade
server OEMs, networking and storage applications, high performance
computing (HPC) applications and large data center deployments, all areas
expected to grow in units and densities going forward."
"Beyond our core memory business, in the first fiscal quarter we continued
to gain traction in our industrial Flash, embedded computing and display
businesses. In particular, we recently secured new design wins with our
Solid State Drive (SSD), Xceed PC/Geode, and display products in the U.S.
and European kiosk markets. As we look ahead, we are confident in our
plans to broaden our product portfolio, deepen market penetration, and
continue our leadership position as one of the largest independent OEM
focused manufacturers of electronic subsystems," concluded Mr. MacKenzie.
Business Outlook
The following statements are based upon management's current expectations.
These statements are forward-looking, and actual results may differ
materially. The Company undertakes no obligation to update these
statements.
For the second quarter of fiscal 2008, SMART estimates net sales will be in
the range of $175 to $185 million, gross profit will be in the range of $34
to $36 million, and GAAP diluted net income per share will be in the range
of $0.18 to $0.19. The shares used in computing diluted net income per
ordinary share are estimated to be in the range of 63.6 million to 64.4
million.
Conference Call Details
SMART's first quarter, fiscal 2008 teleconference and webcast is scheduled
to begin at 1:30 p.m. Pacific Standard Time (PST), or 4:30 p.m. Eastern
Standard Time (EST), on Wednesday, December 19, 2007. The call may be
accessed U.S. toll free by calling (800) 240-6709 or U.S. toll by calling
(303) 262-2191. Please join the conference call at least ten minutes early
in order to register. The passcode for the call is "SMART." SMART will
also offer a live and archived webcast of the conference call, accessible
from the Company's website at www.smartm.com. A telephonic replay of the
conference call will be available through midnight PST, January 2, 2008, by
dialing (800) 405-2236. Callers outside the U.S. and Canada may access the
replay by dialing (303) 590-3000.
Forward-Looking Statements
Statements contained in this press release, including the quotations
attributed to Mr. MacKenzie, that are not statements of historical fact,
including any statements that use the words "will," "believes,"
"anticipates," "estimates," "expects," "intends" or similar words that
describe the company's or its management's future plans, objectives, or
goals, are "forward-looking statements" and are made pursuant to the
safe-harbor provisions of the Private Securities Litigation Reform Act of
1995. These forward-looking statements include the company's financial
performance, technical capabilities, business strategies and product plans.
Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that could cause the actual results of the
company to be materially different from the historical results and/or from
any future results or outcomes expressed or implied by such forward-looking
statements. Factors that would cause or contribute to such differences
include, but are not limited to, production or manufacturing difficulties,
competitive factors, new products and technological changes, fluctuations
in product prices and raw material costs, dependence upon third-party
vendors, customer demand, changes in industry standards or release plans,
and other risks detailed in the company's periodic report filings with the
Securities and Exchange Commission. Such risk factors as outlined in these
reports may not constitute all factors that could cause actual results to
differ materially from those discussed in any forward-looking statement.
The company operates in a continually changing business environment and new
factors emerge from time to time. The company cannot predict such factors,
nor can it assess the impact, if any, from such factors on the company or
its results. Accordingly, forward-looking statements should not be relied
upon as a prediction of actual results. The company is not obligated to
revise or update any forward-looking statements in order to reflect events
or circumstances that may arise after the date of this press release.
About SMART
SMART is a leading independent designer, manufacturer and supplier of
electronic subsystems to original equipment manufacturers, or OEMs. SMART
offers more than 500 standard and custom products to OEMs engaged in the
computer, industrial, networking, gaming, telecommunications, and embedded
application markets. Taking innovations from the design stage through
manufacturing and delivery, SMART has developed a comprehensive memory
product line that includes DRAM, SRAM, and Flash memory in various form
factors. Its Embedded Products Division develops embedded computing
subsystems, backed by design and manufacturing, for markets supporting test
equipment, 3G infrastructure, and network processing applications. SMART's
Display Products Group designs, manufactures, and sells thin film
transistors (TFT) liquid crystal display (LCD) solutions to customers
developing casino gaming systems as well as embedded applications such as
kiosk, ATM, point-of-service, and industrial control systems. SMART's
presence in the U.S., Europe, Asia, and Latin America enables it to provide
its customers with proven expertise in international logistics, asset
management, and supply-chain management worldwide. See www.smartm.com for
more information.
SMART MODULAR TECHNOLOGIES (WWH), INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Three Months
Ended Ended
November 30, November 24,
2007 2006
-------------- --------------
(In thousands, except
per share data)
(Unaudited)
Net sales $ 174,951 $ 237,170
Cost of sales 141,429 199,258
-------------- --------------
Gross profit 33,522 37,912
-------------- --------------
Operating expenses:
Research and development 4,685 4,040
Selling, general and administrative 15,061 14,254
-------------- --------------
Total operating expenses 19,746 18,294
-------------- --------------
Income from operations 13,776 19,618
Interest expense, net (1,024) (2,087)
Other income (expense), net 1,422 (71)
-------------- --------------
Total other income (expense), net 398 (2,158)
-------------- --------------
Income before provision for income
taxes 14,174 17,460
Provision for income taxes 2,681 2,907
-------------- --------------
Net income $ 11,493 $ 14,553
============== ==============
Net income per ordinary share, basic $ 0.19 $ 0.25
============== ==============
Shares used in computing basic net income
per ordinary share 60,695 58,663
============== ==============
Net income per ordinary share, diluted $ 0.18 $ 0.23
============== ==============
Shares used in computing diluted net income
per ordinary share 63,656 63,488
============== ==============
SMART MODULAR TECHNOLOGIES (WWH), INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
November 30, August 31,
2007 2007
------------ ------------
(In thousands)
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 112,814 $ 144,147
Accounts receivable, net of allowances of
$2,350 and $2,517 as of November 30, 2007 and
August 31, 2007, respectively 218,670 184,391
Inventories 65,899 65,105
Prepaid expenses and other current assets 7,836 8,217
------------ ------------
Total current assets 405,219 401,860
Property and equipment, net 36,519 33,588
Goodwill 3,187 3,187
Other non-current assets 14,741 14,442
------------ ------------
Total assets $ 459,666 $ 453,077
============ ============
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable $ 123,998 $ 131,937
Accrued expenses and other current
liabilities 21,627 24,043
------------ ------------
Total current liabilities 145,625 155,980
Long-term debt 81,250 81,250
Other long-term liabilities 863 --
------------ ------------
Total liabilities $ 227,738 $ 237,230
------------ ------------
Shareholders’ equity:
Ordinary shares 10 10
Additional paid-in capital 93,960 92,250
Deferred stock-based compensation (250) (335)
Accumulated other comprehensive income 8,647 6,083
Retained earnings 129,561 117,839
------------ ------------
Total shareholders’ equity 231,928 215,847
------------ ------------
Total liabilities and shareholders’ equity $ 459,666 $ 453,077
============ ============
Contact Information: For More Information Investor Contacts: Jack A. Pacheco Senior Vice President & Chief Financial Officer SMART Modular Technologies 510-624-8134 Suzanne Craig The Blueshirt Group for SMART Modular Technologies 415-217-4962