NEWS RELEASE
AT RF MICRO DEVICES AT THE FINANCIAL RELATIONS BOARD
Dean Priddy Doug DeLieto Nicole Engel
Chief Financial Officer Dir., Investor Relations (212) 445-8000
(336) 931-7152 (336) 931-7968
FOR IMMEDIATE RELEASE
APRIL 22, 2003
RF MICRO DEVICES ANNOUNCES FISCAL 2003
FOURTH QUARTER AND YEAR-END RESULTS
HIGHLIGHTS:
- - Fiscal 2003 Revenue Grows 37.5% Over Fiscal 2002 To $507.8 Million
- - March Quarterly Revenue Declines Sequentially 5.1% To $138.3 Million
- - March Gross Profit Margin Equals 29.5%
- - March Quarterly Loss Per Share Equals $(0.07)
- - Modules Represent 69% of Total March Quarterly Revenue
- - Wireless Local Area Network (WLAN) Revenue Equals $8.3 Million In March
Quarter
- - Company Currently Expects June Revenue To Be Flat To Down 5% And Loss Per
Share Of $(0.05) To $(0.06)
GREENSBORO, NC, APRIL 22, 2003 -- RF Micro Devices, Inc. (Nasdaq: RFMD), a
leading provider of proprietary radio frequency integrated circuits (RFICs) for
wireless communications applications, today reported financial results for its
fiscal 2003 fourth quarter and year ended March 31, 2003.
FINANCIAL RESULTS
Revenue for the quarter was $138.3 million, an increase of 37.7% versus revenue
of $100.4 million for the corresponding quarter of fiscal 2002, and a sequential
decrease of 5.1% versus revenues of $145.8 million for the quarter ended
December 31, 2002. The Company's revenues for the quarter reflect market share
gains in its core market of power amplifiers (PAs) for cellular handsets.
Quarterly revenue was in line with the Company's prior estimate of approximately
$138.3 million, which was provided on April 7, 2003.
Gross profit for the quarter was $40.8 million, which was down slightly from
$40.9 million for the prior year period, and down approximately 25.1%
sequentially from $54.4 million for the quarter ended December 31, 2002. The
sequential decline in gross profit for the quarter reflects decreased demand in
the final weeks of the quarter for higher margin integrated circuit products and
increased demand throughout the quarter for lower margin power amplifier (PA)
modules, specifically dual-band PA modules for GSM handsets.
Net loss for the quarter was $13.0 million, or ($0.07) per diluted share,
compared to net income of $2.8 million, or $0.02 per diluted share, for the
fourth quarter of fiscal 2002 and net loss of $5.2 million, or ($0.03) per
diluted share, for the prior quarter ended December 31, 2002. The quarter ended
December 31, 2002 included merger-related expenses of approximately $10.9
million in connection with the acquisition of Resonext Communications and a
charge of approximately $7.8 million related to the retirement of an interest
rate swap agreement.
The March 2003 quarterly net loss includes a non-cash write-down of investments
of approximately $1.8 million and non-cash depreciation expense of approximately
$2.1 million in accordance with Statement of Financial Accounting Standards No.
144, "Accounting for the Impairment or Disposal of Long-Lived Assets," related
to the depreciation of equipment located at Agere's Orlando facility. The
Company generated positive cash flow from operations of approximately $9.6
million for the March 2003 quarter.
BUSINESS OUTLOOK AND FINANCIAL GUIDANCE
The shift in demand the Company experienced in the final weeks of the March
quarter continued into the first weeks of April. As a result, the Company has
taken a cautious stance both on the near-term wireless market and in the June
guidance provided today.
RF Micro Devices currently has backlog to support June 2003 quarterly revenue
that is flat to down 5% sequentially. The Company currently anticipates June
2003 quarterly net loss per share ranging from $(0.05) to $(0.06).
COMMENTS FROM MANAGEMENT
Bob Bruggeworth, president and CEO of RF Micro Devices, said, "While we believe
our performance in GSM PAs illustrates continued market share gains in power
amplifiers, we recognize the added significance of executing on our initiatives
to improve our gross margins and profitability. We are focused on multiple
initiatives to improve profitability, including the conversion from four- to
six-inch wafer manufacturing, the introduction of next-generation modules, the
addition of Jazz Semiconductor as a supplier of silicon and ongoing yield
improvements, especially in our module products. We continue to believe margins
will improve beginning in the June quarter."
Dean Priddy, CFO and vice president of administration, said, "We're pleased with
our top line performance in fiscal 2003. Entering the new fiscal year our focus
will be on continuing to grow the top line and expanding the gross margin. We're
optimistic that our margin improvement initiatives on PAs will benefit us this
quarter and our POLARIS(TM) TOTAL RADIO(TM) transceiver and WLAN products will
benefit the top line and gross margin later in the year. We're also pleased with
the health of our balance sheet, particularly our inventory turns, DSOs and
positive cash flow from operations."
RF Micro Devices will conduct a conference call at 5:00 p.m. ET today to discuss
today's press release. The conference call will be broadcast live over the
Internet and can be accessed by any interested party at WWW.STREETEVENTS.COM or
WWW.RFMD.COM (under Investor Info). The call will also be available live by
dialing (212) 329-1453, and a replay will be available by dialing (303) 590-3000
and entering pass code 533550.
RF Micro Devices, Inc., an ISO 9001- and ISO 14001-certified manufacturer,
designs, develops, manufactures and markets proprietary radio frequency
integrated circuits (RFICs) primarily for wireless communications products and
applications such as cellular and PCS phones, base stations, wireless LANs, and
cable television modems. The Company offers a broad array of products -
including amplifiers, mixers, modulators/demodulators, and single-chip
receivers, transmitters and transceivers - representing a substantial majority
of the RFICs required in wireless subscriber equipment. The Company's strategy
is to focus on wireless markets by offering a broad range of standard and
custom-designed RFICs in order to position itself as a "one-stop" solution for
its customers' RFIC needs. RF Micro Devices, Inc. is traded on the Nasdaq
National Market under the symbol RFMD.
This press release contains forward-looking statements that relate to RF Micro
Devices' plans, objectives, estimates and goals. Words such as "expect,"
"anticipate," "intend," "plan," "project," "believe," and "estimate," and
variations of these words and similar expressions, identify these
forward-looking statements. RF Micro Devices' business is subject to numerous
risks and uncertainties, including variability in quarterly operating results,
the rate of growth and development of wireless markets, risks associated with
the operation of wafer fabrication facilities and the Company's conversion from
four inch to six inch wafer manufacturing, the Company's ability to manage rapid
growth and to attract and retain skilled personnel,
variability in production yields, raw material availability, manufacturing
capacity constraints, dependence on a limited number of customers and dependence
on third parties. These and other risks and uncertainties, which are described
in more detail in RF Micro Devices' most recent Annual Report on Form 10-K filed
with the Securities and Exchange Commission, could cause actual results and
developments to be materially different from those expressed or implied by any
of these forward-looking statements.
###
RF MICRO DEVICES(R), RFMD(R) and POLARIS(TM) TOTAL RADIO(TM) are
trademarks of RFMD, LLC. All other trade names, trademarks and
registered trademarks are the property of their respective owners.
For more information about RFMD, please visit our website at WWW.RFMD.COM.
FINANCIAL TABLES FOLLOW
RF MICRO DEVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED TWELVE MONTHS ENDED
MARCH 31, MARCH 31,
2003 2002 2003 2002
(UNAUDITED) (UNAUDITED) (UNAUDITED) (AUDITED)
Total revenue $ 138,329 $ 100,434 $ 507,819 $ 369,308
Costs and expenses:
Cost of goods sold 97,539 59,504 325,168 248,965
Research and development 31,708 22,398 101,737 74,445
Marketing and selling 10,610 8,165 36,833 28,993
General and administrative 4,730 3,593 18,364 14,224
Other operating expense 2,108 517 13,961 14,085
Impairment of long-lived assets - - - 6,801
------------ ------------ ------------- ------------
Total costs and expenses 146,695 94,177 496,063 387,513
------------ ------------ ------------ ------------
Operating (loss) income (8,366) 6,257 11,756 (18,205)
Other (expense) income, net (4,499) (6,028) (20,842) (9,208)
------------ ------------ ------------ ------------
Income (loss) before income taxes ($ 12,865) $ 229 ($ 9,086) ($ 27,413)
Income tax expense (benefit) 121 (2,540) 250 ( 6,829)
------------ ------------ ------------ ------------
Net income (loss) ($ 12,986) $ 2,769 ($ 9,336) ($ 20,584)
============ ============ ============ ============
Net income (loss) per share, diluted ($ 0.07) $ 0.02 ($ 0.05) ($ 0.12)
============ ============ ============ ============
Weighted average outstanding diluted
shares 183,142 174,976 172,706 165,827
============ ============ ============ ============
RF MICRO DEVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
MARCH 31, MARCH 31,
2003 2002
(UNAUDITED) (AUDITED)
---------------- ---------------
ASSETS
Current assets:
Cash and cash equivalents $ 164,422 $ 157,648
Short-term investments 92,187 186,526
Accounts receivable, net 66,849 56,373
Inventories 57,781 38,734
Other current assets 11,382 16,689
---------------- ---------------
Total current assets 392,621 455,970
Property and equipment, net 312,013 221,679
Goodwill 110,006 34,525
Non-current investments 59,440 2,797
Intangible assets, net 56,486 11,754
Other assets 2,259 2,275
---------------- ---------------
Total assets $932,825 $729,000
================ ===============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 46,879 $ 31,599
Other current liabilities 29,604 -
Current obligations under capital leases 1,057 3,319
---------------- ---------------
Total current liabilities 77,540 34,918
Long-term debt, net 295,865 294,248
Obligations under capital leases, less current maturities 611 169
Other long-term liabilities 1,409 9,980
---------------- ---------------
Total liabilities 375,425 339,315
Shareholders' equity:
Total shareholders' equity 557,400 389,685
---------------- ---------------
Total liabilities and shareholders' equity $ 932,825 $ 729,000
================ ===============