SAN JOSE, Calif., May 1, 2009 (GLOBE NEWSWIRE) -- Pericom Semiconductor Corporation (Nasdaq:PSEM), a worldwide supplier of high-speed integrated circuits and frequency control products, today announced results for its fiscal third quarter ended March 28, 2009.
Quarterly Summary
* Net revenues declined 21% sequentially and 41% year-over-year to $24.4 million. * Gross profits decreased $2.1 million sequentially and $6.8 million year-over-year. * Gross margin of 35.5% improved 63 basis points on a sequential basis and decreased 205 basis points year-over-year. * Net income fell 85% sequentially and 94% year-over-year to $256,000. * Total shares repurchased during the period were 85,803 shares for $471,815.
Net revenues for the third quarter were $24.4 million, down 21% from the $30.7 million reported in the second quarter, and down 41% from the $41.2 million reported in the comparable period last year. Gross margin was 35.5%, up from 34.9% last quarter, and down from 37.6% in the comparable period last year. Net revenues for the nine-month period ending March 28, 2009 were $99.0 million, down 18% from $120.4 million in the prior year comparable period. Gross margin in the nine-month period ending March 28, 2009 was 35.7%, down from 37.0% in the comparable period last year.
Operating expenses in the quarter were $9.4 million, down from $10.0 million in the previous quarter and down from $10.2 million in the comparable period last year. Operating expenses in the nine-month period ending March 28, 2009 were $30.6 million, up from $30.2 million in the comparable period last year. Share-based compensation expense in the quarter was $998,000, up from $904,000 in the previous quarter and up from $585,000 in the comparable period last year. Stock based compensation expense for the nine-month period ended March 28, 2009 was $2.7 million, up from $1.7 million in the comparable prior year period.
Net income in the quarter was $256,000, or $0.01 per diluted share, compared with net income of $1.7 million, or $0.07 per diluted share in the second quarter, and net income of $4.1 million, or $0.16 per diluted share in the same period a year ago. Net income in the nine-month period ending March 28, 2009 was $5.9 million, or $0.23 per diluted share, down from $12.4 million, or $0.47 per diluted share in the comparable prior year period.
"Our third quarter results reflect the difficult global economic environment in which we are currently operating," said Alex Hui, president and CEO of Pericom. "Over the past two quarters we have experienced a sharp decline in revenue, which was consistent with declining end-market demand and inventory reduction initiatives across the supply chain. As a result, we have taken steps to reduce our operating expenses to better match lower revenue expectations for our business.
"We believe the inventory reduction initiatives have been or will soon be completed. Our bookings began improving towards the end of the March quarter and resulted in our having an improved backlog as we entered the June quarter. We believe our revenues reached a low point in the March quarter, and we expect to see significantly improved revenues this quarter as demand levels more closely align with end user demand.
"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 accounting for 17% of total revenue in FYQ3. 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."
New Products
In the March quarter, we continued to expand our serial connectivity solution with the introduction of 11 new products that work across the Signal Integrity, Timing and Connectivity product areas:
* Expanding its solutions for high speed serial protocol signal integrity, Pericom introduced 2 new ReDriver(tm) products supporting the SATA (Serial ATA) protocol for storage media devices. The new products target next generation volume notebook and desktop applications, including advanced 6Gb/s SATA2 applications. These products enable transfer of high speed serial signals across external cables to storage media, such as HDD. * Adding to high speed Connectivity and Switching solutions, Pericom introduced 5 new switch and interface products targeted across USB, HDMI video, and Ethernet serial protocols. Market segments include volume consumer GPS, PC graphics, Consumer digital video, notebook/docking, and ultra mobility platforms such as cell phones and PDA. * Expanding its timing solutions for next generation platforms, Pericom introduced 4 new products and families in the past quarter. Advanced clock buffers and generators address PC and peripherals, storage, telecom, and GPS market segments, while the new XP crystal oscillator (XO) family is aimed at Ethernet, Storage, and GPON market segments and applications.
Share Repurchase Update
On April 26, 2007, the Company's Board of Directors authorized the repurchase of 2.0 million shares, and on April 29, 2008, our Board of Directors authorized the repurchase of an additional $30 million of our common stock. The Company has completed the repurchase of 2,000,000 shares under the 2007 authority at a total cost of approximately $25.2 million. Pursuant to the 2008 authority, the Company repurchased 85,803 shares in the three months ended March 28, 2009 for an aggregate cost of $471,815 and an average per share purchase price of $5.50. For the nine months ended March 28, 2009 the Company repurchased 712,297 shares for $5,450,964, with an average of $7.65 per share. The remaining balance of potential share repurchases under the 2008 authority is approximately $26.5 million.
Fiscal Q4 Outlook
The following statements are based on current expectations. These statements are forward looking, and actual results may differ materially.
* Revenues in the fourth fiscal quarter are expected to be in the range of $27.0 million to $30.0 million. * Gross margins are expected to be in the 32.0% to 34.0% range. * Operating expenses are expected to be in the range of $9.0 to $9.5 million, which include stock-based compensation expense of approximately $1.0 million. * Other income is expected to be approximately $1.0 million, consisting primarily of interest income. * The effective tax rate is expected to be approximately 31 percent.
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) 879-6207 (domestic) or (719) 325-4759 (international) and reference "Pericom."
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 Passcode 7884625.
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 (Nasdaq:PSEM) enables serial connectivity with the industry's most complete solutions for the computing, communications and consumer market segments. Pericom's analog, digital and mixed-signal integrated circuits, along with its SaRonix-eCERA frequency control products, are essential in the timing, switching, bridging and conditioning of high-speed signals required by today's ever-increasing speed and bandwidth demanding applications. Company headquarters is in San Jose, California, with design centers and technical sales and support offices globally. http://www.pericom.com
This press release contains forward-looking statements as defined under The Securities Litigation Reform Act of 1995. Forward-looking statements in this release include statements regarding the completion of inventory reduction initiatives, our revenues reaching a low point in the March quarter, expectations as to improved revenues in the fiscal fourth quarter, Pericom being well positioned and the statements under the caption "Fiscal Q4 Outlook," which regard the anticipated revenues, gross margins, operating expenses, other income and the effective tax rate. The Company's actual results could differ materially from what is set forth in such forward-looking statements due to a variety of risk factors, including a prolonged continuation of the current economic downturn, softness in demand for our products, price erosion for certain of our products, unexpected difficulties in developing new products, customer decisions to reduce inventory, economic or financial difficulties experienced by our customers, or technological and market changes. All forward-looking statements included in this document are made as of the date hereof, based on information available to the Company as of the date hereof, and Pericom assumes no obligation to update any forward-looking statements. Parties receiving this release are encouraged to review our quarterly report on Form 10-Q for the quarter ended December 27, 2008 and in particular the risk factors sections of that filing.
Pericom Semiconductor Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
------------------ -----------------
Mar 28, Dec 27, Mar 29, Mar 28, Mar 29,
2009 2008 2008 2009 2008
-------- -------- -------- -------- --------
Net revenues $ 24,394 $ 30,732 $ 41,177 $ 99,022 $120,371
Cost of revenues 15,731 20,013 25,709 63,657 75,870
-------- -------- -------- -------- --------
Gross profit 8,663 10,719 15,468 35,365 44,501
Operating expenses:
Research and
development 3,996 4,363 4,503 12,580 12,863
Selling, general
and administrative 5,136 5,453 5,705 17,491 17,330
Restructuring
charge 293 217 -- 510 --
-------- -------- -------- -------- --------
Total 9,425 10,033 10,208 30,581 30,193
Income (loss) from
operations (762) 686 5,260 4,784 14,308
Interest and other
income 1,501 1,264 903 3,871 3,895
Other than temporary
decline in value of
investment (48) -- (52) (92) (52)
-------- -------- -------- -------- --------
Income before income
tax expense 691 1,950 6,111 8,563 18,151
Income tax expense 460 147 2,054 2,676 6,089
Minority interest in
income of
consolidated
subsidiaries (24) (23) (47) (92) (63)
Equity in net income
(loss) of
unconsolidated
affiliates 49 (71) 131 95 421
-------- -------- -------- -------- --------
Net income $ 256 $ 1,709 $ 4,141 $ 5,890 $ 12,420
======== ======== ======== ======== ========
Basic income per
share $ 0.01 $ 0.07 $ 0.16 $ 0.23 $ 0.48
======== ======== ======== ======== ========
Diluted income per
share $ 0.01 $ 0.07 $ 0.16 $ 0.23 $ 0.47
======== ======== ======== ======== ========
Shares used in
computing basic
income per share 25,218 25,418 25,835 25,438 25,823
======== ======== ======== ======== ========
Shares used in
computing diluted
income per share 25,282 25,496 26,633 25,673 26,657
======== ======== ======== ======== ========
Pericom Semiconductor Corporation
Condensed Consolidated Balance Sheets
(In thousands)
As of As of
March 28, 2009 June 28, 2008
-------------- -------------
(unaudited)
---------
Assets
Current Assets:
Cash and cash equivalents $ 29,617 $ 41,646
Short-term investments 69,261 72,108
Accounts receivable
Trade 22,158 29,002
Other receivables 1,602 1,684
Inventories 17,268 17,921
Prepaid expenses and other current
assets 1,395 5,943
Deferred income taxes 3,888 3,344
-------------- -------------
Total current assets 145,189 171,648
Property, plant and equipment - net 34,103 29,173
Investments in unconsolidated
affiliates 10,512 10,392
Deferred income taxes - non current 4,652 4,543
Long-term investments in marketable
securities 24,023 10,171
Goodwill 1,665 1,325
Intangible assets 1,823 1,140
Other assets 3,150 3,191
-------------- -------------
Total assets $225,117 $231,583
============== =============
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 6,843 $ 13,431
Accrued liabilities 6,130 8,779
-------------- -------------
Total current liabilities 12,973 22,210
Long-term debt 1,628 --
Deferred tax liabilities 800 800
Other long term liabilities 1,018 --
Minority interest in consolidated
subsidiaries 1,211 1,118
-------------- -------------
Total liabilities 17,630 24,128
Shareholders' equity:
Common stock and paid in capital 130,819 132,028
Retained earnings and other
comprehensive income 76,668 75,427
-------------- -------------
Total shareholders' equity 207,487 207,455
-------------- -------------
Total liabilities and
shareholders' equity $225,117 $231,583
============== =============