AUSTIN, Texas – April 30, 2003 – Cirrus Logic, Inc. (Nasdaq: CRUS), today announced financial results for its fiscal fourth quarter and fiscal year 2003, ended March 29, 2003. Fiscal fourth quarter results were in line with the company’s January 22, 2003 guidance. All financial information contained in this release was prepared in accordance with generally accepted accounting principles (GAAP).
The company reported fourth quarter revenue of $52.1 million, down 14 percent from the $60.5 million reported in the third quarter. Fourth quarter gross margin was 51 percent, unchanged from the third quarter. Fourth quarter combined research and development and selling, general and administrative expenses were $34.8 million, a 13 percent reduction over the prior quarter on a comparable basis. In the fourth quarter, the company took a non-cash charge of $136.2 million related to the write-off of goodwill in accordance with SFAS 142 and to the impairment of intangible assets associated primarily with the previously announced closing of our wireless product line. Including this non-cash charge, the fourth quarter net loss was $152.8 million, compared with $12.2 million in the third quarter; net loss per share was $1.82, compared with a net loss per share of $0.15 in the prior quarter. Total cash at the end of the fourth quarter was $123 million, compared with $125 million at the end of the third quarter.
“I am encouraged by the progress we made with recent new product introductions. While our sales performance met our fourth quarter guidance, our results were constrained by lower demand for some of our older mixed-signal products and the effects of the uncertain macroeconomic and geopolitical environment," said David D. French, president and CEO, Cirrus Logic, Inc.
Fiscal year 2003 revenue was $262.0 million, compared with $411.0 million in fiscal year 2002. Fiscal year 2002 revenue included $129.4 million from magnetic storage products, a product line that Cirrus exited in July 2001. Gross margin in fiscal year 2003 was 50 percent, up from 24 percent in the prior year. The net loss decreased in fiscal year 2003 to $199.2 million from a net loss of $206.1 million in fiscal year 2002. Net loss per share was $2.39, compared with a net loss per share of $2.66 in the prior fiscal year.
“In fiscal 2003, we maintained our leadership position for audio applications, our largest product category. While we made important technology strides in advancing our video product line in fiscal 2003, we were not able to capitalize on the expanding market for DVD players due to challenges in meeting the rigorous software quality requirements in this new market. We have made significant progress in this area and are working with customers on DVD player applications using our decoder products. In addition, the market for video recording products, PVR and DVD recorders, did not materialize as quickly as we had anticipated earlier in the year. We believe that we are well positioned for the emerging DVD recording market with our high-performance CS98200 DVD decoder family and CS92288 encoder product,” said French.
Recent Highlights
Outlook and Guidance
“We believe that customers and distributors will continue to be cautious and closely manage their build plans, maintain short order lead times and very lean inventory levels,” said French. “In the June quarter, we expect results to be further impacted by the previously announced expiration of our obligations to supply certain game console components. As customers move into production with our new audio and video components, especially our designs for the high-growth video recording market, we expect to see revenue growth return in the second half of calendar 2003.”
First Quarter FY04 (ending June 28, 2003)
Conference Call
Cirrus Logic management will hold a conference call to discuss these results today, April 30, 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 May 7, 2003. To access the replay, dial (617) 801-6888 (pass code: 593269). A live webcast of the conference call will also be available.
Upcoming Investor Conferences
Cirrus Logic management will be presenting at the JPMorgan Technology and Telecom Conference in San Francisco on May 7 at 11 a.m. Central Time, and in New York at the U.S. Bancorp Piper Jaffray Technology Conference on May 14 at 8:40 a.m. Central Time. Those wishing to listen to management’s presentations can hear a live and/or an archived webcast via the company’s website.
About Cirrus Logic
Cirrus Logic, Inc., 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.
Safe Harbor Statement
Except for historical information contained herein, the matters set forth in this news release, including our estimates of first fiscal quarter revenues, research and development and selling, general and administrative expense levels, and gross margin levels, and expectations regarding our revenue growth opportunities, are forward-looking statements that are subject to certain risks and uncertainties including such factors, among others, as overall conditions in the semiconductor market; the expansion of the consumer digital entertainment electronics market; the ability of the company to successfully realize the benefits of its acquisitions; the possible adverse impact of severe acute respiratory syndrome (SARS) on our business; the ability of the company 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 first fiscal quarter of 2004, as well as customer cancellations of orders, or the failure to place orders consistent with forecasts; pricing pressures; hardware or software deficiencies; a shortage of manufacturing capacity; the ability of the company to make continued substantial investments in research and development; the retention of key employees; the impact of restructuring charges, such as work force reductions and facility consolidations; asset impairment charges; and the risk factors listed in the company's Form 10-K for the year ended March 30, 2002, and in other filings with the Securities and Exchange Commission. The foregoing information concerning Cirrus Logic’s business outlook represents our outlook as of the date of this news release, and Cirrus Logic undertakes no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise, except as required by law.
Cirrus Logic is a trademark of Cirrus Logic, Inc.
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Thurman Case Chief Financial Officer (512) 851-4125 |
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