- Revenue: $583 million
(PRNewswire) — Maxim Integrated Products, Inc. (NASDAQ: MXIM) reported net revenue of $583 million for its fourth quarter of fiscal 2015 ended June 27, 2015, a 1% increase from the $577 million revenue recorded in the prior quarter, and a 9% decrease from the same quarter of last year.
Tunc Doluca, President and Chief Executive Officer, commented, "In our June quarter, although revenue was slightly below our expectations, we exceeded our EPS guidance due to strong execution on our cost initiatives." Mr. Doluca continued, "This is a pivotal time for Maxim. We are transforming our manufacturing footprint to improve flexibility and profitability, and optimizing R&D and Sales to drive growth. Based on these initiatives, we now expect to achieve $180 million in annual, long-term savings compared to our fiscal fourth quarter 2015 run rate."
Fiscal Year 2015 Fourth Quarter Results
Based on Generally Accepted Accounting Principles (GAAP), diluted earnings per share in the June quarter was $0.34. The results were affected by pre-tax special items which primarily consisted of $46 million in charges related to restructuring activities, $22 million in charges related to acquisitions and $36 million in other income related to the gain on a divestiture. GAAP earnings per share, excluding special items was $0.43. An analysis of GAAP versus GAAP excluding special items is provided in the last table of this press release.
Cash Flow Items
At the end of the fourth quarter of fiscal 2015, total cash, cash equivalents and short term investments were $1.63 billion, an increase of $159 million from the prior quarter. Notable items included:
- Cash flow from operations: $222 million
- Net capital additions: $13 million
- Dividends: $80 million ($0.28 per share)
- Stock repurchases: $36 million
Business Outlook
The Company's 90-day backlog at the beginning of the first fiscal quarter of 2016 was $366 million. Based on the beginning backlog and expected turns, results for the September 2015 quarter are expected to be as follows:
- Revenue: $545 million to $585 million
- Gross Margin: 51% to 54% GAAP (60% to 63% excluding special items)
- EPS: $0.22 to $0.28 GAAP ($0.38 to $0.44 excluding special items)
Maxim Integrated's business outlook does not include the potential impact of any restructuring activity, acquisitions, or other business combinations that may be completed during the quarter.
Dividend
A cash dividend of $0.30 per share will be paid on September 3, 2015, to stockholders of record on August 20, 2015. This represents a 7% increase in the dividend compared to the prior quarter.
Conference Call
Maxim Integrated has scheduled a conference call on July 23, 2015, at 2:00 p.m. Pacific Time to discuss its financial results for the fourth quarter of fiscal 2015 and its business outlook. To listen via telephone, dial (866) 804-3547 (toll free) or (703) 639-1328. This call will be webcast by Shareholder.com and can be accessed at the Company's website at
www.maximintegrated.com/company/investor.
A presentation summarizing financial information to be discussed on the conference call is posted at www.maximintegrated.com/company/investor.
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CONSOLIDATED STATEMENTS OF INCOME |
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(Unaudited) |
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Three Months Ended |
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Year Ended |
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June 27, |
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March 28, |
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June 28, |
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June 27, |
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June 28, |
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2015 |
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2015 |
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2014 |
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2015 |
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2014 |
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(in thousands, except per share data) |
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Net revenues |
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$ 582,517 |
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$ 577,263 |
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$ 642,467 |
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$ 2,306,864 |
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$ 2,453,663 |
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Cost of goods sold (1) |
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278,816 |
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261,995 |
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273,507 |
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1,034,997 |
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1,068,898 |
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Gross margin |
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303,701 |
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315,268 |
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368,960 |
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1,271,867 |
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1,384,765 |
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Operating expenses: |
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Research and development |
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121,552 |
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123,913 |
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143,802 |
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521,772 |
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558,168 |
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Selling, general and administrative |
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72,532 |
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75,766 |
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83,153 |
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308,065 |
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324,734 |
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Intangible asset amortization |
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3,618 |
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3,977 |
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4,423 |
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16,077 |
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17,690 |
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Impairment of long-lived assets (2) |
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549 |
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5,522 |
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6,447 |
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67,042 |
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11,644 |
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Impairment of goodwill and intangible assets (3) |
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- |
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- |
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- |
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93,010 |
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2,580 |
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Severance and restructuring expenses (4) |
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12,798 |
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2,824 |
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5,790 |
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30,642 |
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24,902 |
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Acquisition-related costs |
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- |
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- |
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- |
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- |
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6,983 |
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Other operating expenses (income), net (5) |
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(2,296) |
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(2,184) |
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8,795 |
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(2,021) |
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15,773 |
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Total operating expenses |
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208,753 |
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209,818 |
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252,410 |
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1,034,587 |
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962,474 |
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Operating income |
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94,948 |
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105,450 |
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116,550 |
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237,280 |
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422,291 |
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Interest and other income (expense), net (6) |
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28,500 |
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(5,534) |
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(8,943) |
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8,890 |
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(13,065) |
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Income before provision for income taxes |
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123,448 |
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99,916 |
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107,607 |
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246,170 |
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409,226 |
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Provision (benefit) for income taxes |
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24,789 |
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20,483 |
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22,814 |
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40,132 |
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54,416 |
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Net income |
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$ 98,659 |
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$ 79,433 |
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$ 84,793 |
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$ 206,038 |
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$ 354,810 |
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Earnings per share: |
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Basic |
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$ 0.35 |
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$ 0.28 |
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$ 0.30 |
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$ 0.73 |
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$ 1.25 |
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Diluted |
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$ 0.34 |
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$ 0.28 |
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$ 0.29 |
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$ 0.71 |
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$ 1.23 |
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Shares used in the calculation of earnings per share: |
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Basic |
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284,202 |
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283,418 |
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283,431 |
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283,675 |
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283,344 |
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Diluted |
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289,346 |
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288,840 |
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289,487 |
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288,949 |
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289,108 |
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Dividends paid per share |
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$ 0.28 |
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$ 0.28 |
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$ 0.26 |
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$ 1.12 |
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$ 1.04 |
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SCHEDULE OF SPECIAL ITEMS |
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(Unaudited) |
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Three Months Ended |
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Year Ended |
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June 27, |
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March 28, |
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June 28, |
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June 27, |
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June 28, |
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2015 |
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2015 |
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2014 |
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2015 |
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2014 |
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(in thousands) |
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Cost of goods sold: |
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Intangible asset amortization |
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$ 18,116 |
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$ 18,750 |
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$ 18,750 |
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$ 74,366 |
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$ 64,483 |
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Accelerated Depreciation (1) |
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32,765 |
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9,834 |
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- |
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51,494 |
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- |
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Acquisition-related inventory write-up |
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- |
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- |
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371 |
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- |
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18,955 |
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Total |
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$ 50,881 |
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$ 28,584 |
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$ 19,121 |
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$ 125,860 |
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$ 83,438 |
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Operating expenses: |
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Intangible asset amortization |
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$ 3,618 |
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$ 3,977 |
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$ 4,423 |
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$ 16,077 |
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$ 17,690 |
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Impairment of long-lived assets (2) |
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549 |
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5,522 |
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6,447 |
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67,042 |
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11,644 |
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Impairment of goodwill and intangible assets (3) |
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- |
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- |
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- |
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93,010 |
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2,580 |
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Severance and restructuring (4) |
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12,798 |
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2,824 |
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5,790 |
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30,642 |
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24,902 |
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Acquisition-related costs |
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- |
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- |
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- |
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- |
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6,983 |
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Other operating expenses (income), net (5) |
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(2,296) |
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(2,184) |
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8,795 |
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(2,021) |
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15,773 |
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Total |
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$ 14,669 |
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$ 10,139 |
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$ 25,455 |
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$ 204,750 |
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$ 79,572 |
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Interest and other expense (income), net (6) |
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$ (35,849) |
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$ - |
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$ 2,432 |
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$ (36,066) |
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$ 6,155 |
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Total |
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$ (35,849) |
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$ - |
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$ 2,432 |
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$ (36,066) |
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$ 6,155 |
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Provision (benefit) for income taxes: |
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Fixed assets tax basis adjustment (7) |
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$ - |
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$ - |
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$ (1,041) |
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$ - |
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$ (35,603) |
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Reversal of tax reserves (8) |
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- |
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- |
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- |
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(21,747) |
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- |
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Fiscal year 2014 research & development tax credits |
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- |
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- |
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- |
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(2,863) |
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- |
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Total |
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$ - |
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$ - |
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$ (1,041) |
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$ (24,610) |
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$ (35,603) |
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(1) Includes accelerated depreciation related to San Jose wafer manufacturing building and equipment. |
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(2) Includes impairment charges relating to wafer manufacturing equipment, end of line test equipment, and software. |
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(3) Impairment of goodwill and write-off of in-process research and development primarily related to MEMS business. |
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(4) Includes severance charges primarily associated with the reorganization of various business units and manufacturing operations. |
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(5) Other operating expenses (income), net are primarily for legal settlements, loss (gain) relating to sale of assets, and expected loss on lease abandonment. |
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(6) Includes sale of a business and impairment of investment in privately-held companies. |
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(7) Includes one-time fixed asset tax basis adjustments relating to prior year depreciation expense. |
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(8) Reversal of tax reserves related to the favorable settlement of a foreign tax issue. |
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