AUSTIN, Texas – Jan. 21, 2004 – Cirrus Logic Inc. (Nasdaq: CRUS) today announced financial results for the third quarter of fiscal 2004, ended Dec. 27, 2003.
The company reported third quarter revenue of $55.3 million, up 10 percent from $50.1 million reported in the prior quarter. Third quarter gross margins were 52.0 percent, compared with 51.9 percent in the second quarter. Third quarter combined research and development and selling, general and administrative expenses were $30.4 million, a reduction from $32.6 million in the second quarter
Net income in the third quarter was $39.4 million, or $0.46 per diluted share, compared with $21.1 million, or $0.25 per diluted share, in the second quarter. The third quarter net income included a one-time benefit of $45.0 million, resulting from a favorable litigation settlement with Western Digital Corporation. The third quarter results also included $4.1 million of net expense for acquisition-, legal- and restructuring-related items, primarily amortization of acquired intangibles.
Total cash at the end of the third quarter increased to $180.0 million, from $127.3 million at the end of the second quarter. Excluding cash received during the third quarter from two favorable litigation settlements, the company was cash neutral from operations.
"We were pleased to see an increase in both our audio and video sales for the second consecutive quarter. Our sequential revenue growth is a positive indicator of our increased traction in the video recording market and our continued leadership in the audio market," said David D. French, president and CEO of Cirrus Logic Inc. "We were also pleased that our ongoing cost management efforts have resulted in reduced combined R&D and SG&A expenses for the seventh consecutive quarter."
Highlights from the Consumer Electronics Show
Outlook and Guidance
"Looking ahead to the March quarter, we are evaluating channel and retail inventory levels and the actual sell-through from the December holiday season. Although we have design-win momentum and strong product acceptance, we are approaching the March quarter cautiously and we're expecting the lower demand that typically follows the December quarter in consumer electronics for chipmakers," said French.
"We are excited about our prospects for the balance of calendar-year 2004. We continue to invest in new product development and to expand our customer support."
Fourth Quarter FY04 (ending Mar. 27, 2004)
Conference Call
Cirrus Logic management will hold a conference call to discuss these results today, Jan. 21, at 4 p.m. Central Time. Those wishing to join should dial (617) 847-3007 (pass code: Cirrus Logic) at approximately 3:50 p.m. Central Time. A replay of the call will be available starting one hour after the completion of the call until Jan. 28, 2004. To access the replay, dial (617) 801-6888 (pass code: 79362223). A live and an archived webcast of the conference call is also available.
Upcoming Investor Conference
Cirrus Logic management will be presenting at the Thomas Weisel Partners Technology 2004 Conference in San Francisco on Feb. 3. Those wishing to listen to management's presentation can hear a live and/or an archived webcast of this event.
Cirrus Logic Inc.
Cirrus Logic is a premier supplier of high-performance analog, mixed-signal and digital processing solutions for consumer entertainment electronics, automotive entertainment and industrial product applications. Building on its global market leadership in audio ICs and its rich mixed-signal patent portfolio, Cirrus Logic targets audio, video and precision mixed-signal applications in these growing markets. The company operates from headquarters in Austin, Texas, with offices in California, Colorado, Europe, Japan and Asia.
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Safe Harbor Statement
Except for historical information contained herein, the matters set forth in this news release, including our estimates of fourth fiscal quarter revenues, combined research and development and selling, general and administrative expense levels, gross margin and cash levels, expectations regarding our revenue growth opportunities, including the introduction of new products by other companies containing our components during the fourth quarter of fiscal year 2004 and calendar year 2004, and our estimates regarding future retail prices, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and assumptions and are subject to certain risks and uncertainties that could cause actual results to differ materially from our current expectations, estimates and assumptions and the forward-looking statements made in this press release. These risks and uncertainties include, but are not limited to, the following: overall conditions in the semiconductor market; the expansion of the consumer digital entertainment electronics market; our ability to introduce new products on a timely basis and to deliver products that perform as anticipated; risks associated with international sales and international operations; the level of orders and shipments during the fourth quarter of fiscal-year 2004, as well as customer cancellations of orders, or the failure to place orders consistent with forecasts; our expectations regarding our potential cost savings; pricing pressures; hardware or software deficiencies; our dependence on subcontractors for assembly, manufacturing, packaging and testing functions; our ability to make continued substantial investments in research and development; foreign currency fluctuations; the retention of key employees; the impact of restructuring and other costs, such as work force reductions and facility consolidations; and the risk factors listed in our Form 10-K for the year ended March 29, 2003, and in other filings with the Securities and Exchange Commission. The foregoing information concerning our business outlook represents our outlook as of the date of this news release, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.
Cirrus Logic and Cirrus are trademarks of Cirrus Logic Inc. All other product names noted herein may be trademarks of their respective holders.
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Thurman Case Chief Financial Officer (512) 851-4125 |
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