Quarterly Highlights
-- Net revenues grew 22% sequentially yet declined 31% year-over-year to
$29.7 million
-- Net income increased 306% sequentially, and decreased 77% year-over-
year to $1.0 million
Fiscal Year Highlights
-- Net revenues decreased 21% versus the prior year period
-- Net income decreased 64% versus the prior year period
-- Gross margins declined 318 basis points over the prior year period
-- Total share repurchase activity totaled 712,000 shares
Fourth Quarter Operating Results
Net revenues for the fourth quarter were $29.7 million, up 21.8% from the
$24.4 million reported in the third quarter, and down 31.5% from the $43.4
million reported in the comparable period last year. Gross margin was
28.7%, down from 35.5% last quarter, and down from 36.0% in the comparable
period last year, mainly due to lower manufacturing volumes and resulting
increased overhead absorption, as well as pricing pressure. Operating
expenses in the quarter were $9.5 million, up from $9.4 million in the
previous quarter and down from $10.6 million in the comparable period last
year. Stock-based compensation expense in the quarter was $888,000, down
from $998,000 in the previous quarter and up from $615,000 in the
comparable period last year. Net income in the quarter was $1.0 million, or
$0.04 per diluted share, compared with net income of $256,000, or $0.01 per
diluted share in the third quarter and net income of $4.6 million, or $0.17
per diluted share, in the same period a year ago.
FY09 Operating Results
Net revenues for the fiscal year ending June 27, 2009 were $128.6 million,
down 21.4% from $163.7 million in the prior year comparable period. Gross
margin in the year ending June 27, 2009 was 33.5% as compared with 36.7% in
the comparable period last year, reflecting pricing pressure in our markets
and reduced capacity utilization in our operations. Operating expenses in
the year ending June 27, 2009 were $40.1 million, down slightly from $40.8
million in the comparable period last year. Stock based compensation
expense for the year ended June 27, 2009 was $3.6 million, up from $2.4
million in the comparable prior year period. Net income in the year ending
June 27, 2009 was $6.1 million, or $0.24 per diluted share, down from $17.0
million, or $0.64 per diluted share in the comparable prior year period.
"Our fourth quarter confirmed the improved demand we anticipated at the
start of the quarter, and this trend is being sustained into the first
quarter of fiscal 2010," said Alex Hui, president and CEO of Pericom.
"Our bookings have continued to grow during the June quarter, and resulted
in our having an improved backlog as we entered the September quarter. We
believe our revenues are now better aligned with end user demand, which we
believe will gradually strengthen in the coming months.
"In the fourth quarter we experienced a reduction in gross margins
resulting from underabsorption of overhead in prior quarters as well as
pricing pressure in competitive markets. As a result, we have taken steps
to improve gross margin through initiatives to reduce product cost as well
as improve product mix.
"Enabling serial connectivity in computer, communication and consumer
applications remains our primary focus. We are encouraged by the increasing
deployment of our serial protocol solution in our focus market segments,
with PCI-e and e-SATA products accounted for 18% of total revenue in FYQ4.
Despite the downturn, we continue to invest in innovation. We are
developing connectivity and timing solutions for next generation serial
protocols such as PCI-Express Gen3, DisplayPort 1.2 and USB 3.0. We believe
our comprehensive serial connectivity and timing solutions position us well
for long term growth."
Restated Financials
The Company is also issuing restated financial results for the first three
quarters of fiscal 2009 to correct misstatements involving inventory
reserves and inventory valuation, revenue, cost of goods sold and an
other-than-temporary impairment of a securities investment. These
adjustments reduced Q1 net income by $264K resulting in a restated Q1 net
income of $3,661K or $0.14 per diluted share and reduced Q2 net income by
$579K resulting in a restated Q2 net income of $1,130K or $0.04 per diluted
share. The comparison of the restated first and second quarters with
previously reported results are included in the financial tables section of
this release.
New Products
Pericom introduced 10 new products across the Signal Integrity, Switching,
Timing and Connectivity product areas in this quarter.
Expanding its solutions for high-speed serial protocol signal integrity,
Pericom introduced two new ReDriver products, the first supporting the 6
Gigabits/sec SATA (Serial ATA)/SAS (Serial Attached SCSI) storage media
protocols, and the second supporting the DisplayPort video graphics
protocol. Both ReDrivers target next generation volume notebook and
desktop applications for storage media attachment, and for advanced digital
video and graphics. These products enable transfer of high-speed serial
signals across external cables to end points such as HDD or monitor.
Pericom introduced seven new switching and connectivity products targeted
across USB, DisplayPort, and PCI Express protocols. Target market segments
include volume Consumer digital video, PC notebook, desktop, and graphics,
and Ultra Mobility platforms such as cell phones and PDA.
Finally, Pericom introduced an advanced PCIe Gen 2 (5Gb/s) 'quad output'
clock generator featuring extremely low jitter, and targeting the
Networking and PC Peripherals market segment, with applications such as
wireless router and other networking applications, and multi-function
printers.
Fiscal Q1 Outlook
The following statements are based on current expectations. These
statements are forward looking, and actual results may differ materially.
-- Revenues in the first fiscal quarter are expected to be in the range
of $31.5 million to $32.5 million.
-- Gross margins are expected to be in the 31% to 33% range. Margins are
influenced by the product mix of turns business and sales, if any, of
previously reserved inventory.
-- Operating expenses are expected to be in the range of $10.5 to $11.5
million, which include stock-based compensation expense of approximately
$0.9 million, year-end/SOX audit fees $0.5M and the additional expenses
related to accounting review $1.2M.
-- Other income is expected to be approximately $1.3 million, consisting
primarily of interest income.
-- Net income from unconsolidated affiliates PTI and JCP of $0.4 - $0.5M.
-- The effective tax rate is expected to be approximately 32%.
Conference Call
The press release will be followed by a conference call beginning at 1:30
p.m. Pacific time. To listen to the call, dial (877) 723-9521 and reference
"Pericom." A slide presentation will accompany the conference call. To
view the slides, please visit the investor relations section of
www.pericom.com.
A taped replay of the conference call will be made available for five
business days. To listen to the replay, dial (888) 203-1112 and reference
conference number 6794266. The Pericom financial results conference call
will be available via a live webcast on the investor relations section of
the web site at http://www.pericom.com. Access the web site 15 minutes
prior to the start of the call to download and install any necessary audio
software. An archived webcast replay will be available on the web site for
approximately 90 days.
About Pericom
Pericom Semiconductor Corporation (
Pericom Semiconductor Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)
Three Months Ended Twelve Months Ended
---------------------------- -------------------
Jun 27 Mar 28 Jun 28 Jun 27 Jun 28
2009 2009 2008 2009 2008
-------- -------- -------- -------- --------
Net revenues $ 29,721 $ 24,394 $ 43,373 $128,645 $163,744
Cost of revenues 21,193 15,731 27,768 85,514 103,638
-------- -------- -------- -------- --------
Gross profit 8,528 8,663 15,605 43,131 60,106
Operating expenses:
Research and
development 4,117 3,996 4,296 16,697 17,159
Selling, general and
administrative 5,343 5,136 6,294 22,833 23,624
Restructuring charge 74 293 - 584 -
-------- -------- -------- -------- --------
Total 9,534 9,425 10,590 40,114 40,783
Income from operations (1,006) (762) 5,015 3,017 19,323
Interest and other
income, net 1,677 1,501 1,606 5,548 5,501
Other than temporary
decline in value of
investment - (48) (24) (506) (76)
-------- -------- -------- -------- --------
Income before income
taxes 671 691 6,597 8,059 24,748
Income tax expense (135) 460 2,132 2,209 8,221
Minority interest in
(income) loss in
consolidated subsidiary (22) (24) (53) (114) (116)
Equity in income (loss)
of investees 256 49 181 351 602
-------- -------- -------- -------- --------
Net income $ 1,040 $ 256 $ 4,593 $ 6,087 $ 17,013
======== ======== ======== ======== ========
Basic income per share $ 0.04 $ 0.01 $ 0.18 $ 0.24 $ 0.66
======== ======== ======== ======== ========
Diluted income per share $ 0.04 $ 0.01 $ 0.17 $ 0.24 $ 0.64
======== ======== ======== ======== ========
Shares used in computing
basic income per share 25,354 25,218 25,480 25,417 25,737
======== ======== ======== ======== ========
Shares used in computing
diluted income per share 25,485 25,282 26,472 25,626 26,611
======== ======== ======== ======== ========
Pericom Semiconductor Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)
Restatements
Three Months Ended Three Months Ended
---------------------- ----------------------
Sep 27 Sep 27 Dec 27 Dec 27
2008 2008 2008 2008
---------- ---------- ---------- ----------
As As
Previously As Previously As
Reported Restated Reported Restated
---------- ---------- ---------- ----------
Net revenues $ 43,896 $ 43,798 $ 30,732 $ 30,732
Cost of revenues 27,914 27,805 20,013 20,785
---------- ---------- ---------- ----------
Gross profit 15,982 15,993 10,719 9,947
Operating expenses:
Research and development 4,221 4,221 4,363 4,363
Selling, general and
administrative 6,901 6,901 5,453 5,453
Restructuring charge - - 217 217
---------- ---------- ---------- ----------
Total 11,122 11,122 10,033 10,033
Income from operations 4,860 4,871 686 (86)
Interest and other income,
net 1,106 1,106 1,264 1,264
Other than temporary
decline in value of
investment (44) (458) - -
---------- ---------- ---------- ----------
Income before income taxes 5,922 5,519 1,950 1,178
Income tax expense 2,069 1,930 147 (46)
Minority interest in
(income) loss in
consolidated subsidiary (45) (45) (23) (23)
Equity in income (loss) of
investees 117 117 (71) (71)
---------- ---------- ---------- ----------
Net income $ 3,925 $ 3,661 $ 1,709 $ 1,130
========== ========== ========== ==========
Basic income per share $ 0.15 $ 0.14 $ 0.07 $ 0.04
========== ========== ========== ==========
Diluted income per share $ 0.15 $ 0.14 $ 0.07 $ 0.04
========== ========== ========== ==========
Shares used in computing
basic income per share 25,679 25,679 25,418 25,418
========== ========== ========== ==========
Shares used in computing
diluted income per share 26,239 26,239 25,495 25,495
========== ========== ========== ==========
Pericom Semiconductor Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(unaudited)
As of As of
Jun 27,2009 Jun 28,2008
----------- -----------
Assets
Current Assets:
Cash & cash equivalents $ 37,321 $ 41,646
Restricted cash 3,200 -
Short-term investments 75,471 72,108
Accounts receivable - trade 22,875 29,002
Inventories 16,340 17,921
Prepaid expenses and other current assets 3,738 7,627
Deferred income taxes 2,433 3,344
----------- -----------
Total current assets 161,378 171,648
Property and equipment, net 47,238 29,173
Investments in unconsolidated affiliates 10,826 10,392
Deferred income taxes - non current 4,657 4,543
Long-term investments in marketable securities 11,780 10,171
Goodwill 1,673 1,325
Intangible assets 1,764 1,140
Other assets 6,742 3,191
----------- -----------
Total assets $ 246,058 $ 231,583
=========== ===========
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 10,824 $ 13,431
Accrued liabilities 15,118 8,779
Current portion of long-term debt 60 -
----------- -----------
Total current liabilities 26,002 22,210
Long-term debt 1,610 -
Industrial development subsidy 3,718 -
Deferred tax liabilities - 800
Other long term liabilities 1,287 -
Minority interest in consolidated subsidiaries 1,233 1,118
----------- -----------
Total liabilities 33,850 24,128
Shareholders' equity:
Common stock 133,162 132,028
Retained earnings and other 79,046 75,427
----------- -----------
Total shareholders' equity 212,208 207,455
----------- -----------
Total liabilities and shareholders'
equity $ 246,058 $ 231,583
=========== ===========
Contact Information: Contact: Robert Strickland Pericom Semiconductor Tel: 408 435-0800