Exhibit 99
Contact: Richard Crowley
Micrel, Incorporated
2180 Fortune Drive
San Jose, CA 95131
Phone: (408) 944-0800
[Micrel Logo]
PRESS RELEASE
MICREL REPORTS FIRST QUARTER 2007 FINANCIAL RESULTS
* First quarter revenues of $63.1 million, down 2% sequentially and 7%
year-over-year
* First quarter gross margin increases to 58.1% from 57.3% in the previous
quarter
* First quarter net income per diluted share of $0.23, compared with $0.11
in fourth quarter and $0.10 in first quarter 2006
San Jose, CA, April 25, 2007 - Micrel, Incorporated (Nasdaq NM: MCRL), an
industry leader in analog, high bandwidth communications and Ethernet IC
solutions, today announced financial results for the first quarter ending
March 31, 2007.
Revenues for the first quarter were $63.1 million, a decrease of 2% from
fourth quarter of 2006 revenues of $64.5 million and 7% lower than revenues of
$68.1 million recorded in the year-ago period. First quarter net income was
$17.9 million, or $0.23 per diluted share compared with net income of $8.8
million, or $0.11 per diluted share in the fourth quarter of 2006 and $8.7
million, or $0.10 per diluted share in the year ago period. Included in first
quarter net income is a one-time $15.5 million pre-tax gain associated with a
legal settlement, which after income taxes, is equivalent to $0.13 per diluted
share.
Order rates increased on a sequential basis in the first quarter. The
improvement in bookings was driven by higher order levels from customers
serving the high speed communications, wireless handset and industrial end
markets. In addition, bookings increased across all geographic areas,
resulting in a book-to-bill ratio greater than one.
"We are encouraged by the improvement in demand we experienced in the first
quarter," stated Ray Zinn, president and CEO of Micrel. "Although customers
continued to closely monitor and control their inventories during the period,
the order rates the Company experienced suggest that customer and channel
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MICREL REPORTS FIRST QUARTER 2007 RESULTS
April 25, 2007
Page 2 of 6
inventories have fallen to levels consistent with current end demand. While
the improvement in demand did not prevent a sequential decline in revenues, we
are pleased that Micrel's first quarter gross margin increased on a sequential
basis. This gross margin improvement was accomplished while reducing our
inventory levels. Importantly, cash flows continued to be strongly positive
and we released an exciting group of new products during the quarter."
As announced yesterday, Micrel's board of directors has authorized the
commencement of a quarterly dividend payment. The initial dividend payment of
$0.03 per share of common stock will paid on May 30, 2007 to shareholders of
record as of May 8, 2007.
Outlook
-------
Order lead times for the Company's products remain fairly stable at four to
six weeks, but a relatively high proportion of quarterly revenue must still be
booked and shipped within the quarter to OEM customers, or resold through the
Company's distributors. Based upon current backlog levels and demand
estimates, the Company projects second quarter 2007 revenues will increase
sequentially by 2% to 6%, and earnings per diluted share will be in a range of
$0.10 to $0.12.
Conference Call
---------------
The Company will host a conference call at 4:30 p.m. Eastern time
(1:30 p.m. Pacific time) on April 25, 2007. Chief Executive Officer Raymond
Zinn and Chief Financial Officer Richard Crowley will present an overview of
first quarter financial results, discuss current business conditions and then
respond to questions.
The call is available, live, to any interested party on a listen only
basis by dialing (866) 249-5225. For international callers, please dial
(303) 262-2125. Interested callers should dial-in at least five minutes
before the scheduled start time and ask to be connected to the Micrel,
Incorporated Conference Call. A live webcast will also be available through
www.vcall.com. An audio replay of the conference call will be available
through May 2, 2007, by dialing (303) 590-3000 or (800) 405-2236 and entering
access code number 11088231. The webcast replay will also be available on the
Company's website at: www.micrel.com.
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MICREL REPORTS FIRST QUARTER 2007 RESULTS
April 25, 2007
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SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
This press release includes statements that qualify as forward-looking
statements under the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include statements about the following topics: our
expectations regarding future financial results, including revenues, net
income, earnings per share, order lead times, customer demand, customer and
supply chain inventory levels and the nature of macro-economic and industry
trends. Forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially. Those
risks and uncertainties include, but are not limited to, such factors as:
softness in demand for our products; customer decisions to cancel, reschedule,
or delay orders for our products; the effect that lead times and channel
inventories have on the demand for our products; economic or financial
difficulties experienced by our customers; the effect of business conditions
in the computer, telecommunications and industrial markets; the impact of any
previous or future acquisitions; changes in demand for networking or high
bandwidth communications products; the impact of competitive products and
pricing and alternative technological advances; the accuracy of estimates used
to prepare the Company's financial statements; the global economic situation;
the ability of the Company's vendors and subcontractors to supply or
manufacture the Company's products in a timely manner; the timely and
successful development and market acceptance of new products and upgrades to
existing products; softness in the economy and the U.S. stock markets as a
whole; fluctuations in the market price of Micrel's common stock and other
market conditions; the difficulty of predicting our future cash needs; the
nature of other investment opportunities available to the Company from time to
time; and Micrel's operating cash flow. For further discussion of these
risks and uncertainties, we refer you to the documents the Company files with
the SEC from time to time, including the Company's Annual Report on Form 10-K
for the year ended December 31, 2006. All forward-looking statements are made
as of today, and the Company disclaims any duty to update such statements.
About Micrel
------------
Micrel Inc., is a leading global manufacturer of IC solutions for the
worldwide analog, Ethernet and high bandwidth markets. The Company's
products include advanced mixed-signal, analog and power semiconductors; high
performance communication, clock management, Ethernet switch and physical
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MICREL REPORTS FIRST QUARTER 2007 RESULTS
April 25, 2007
Page 4 of 6
layer transceiver ICs. Company customers include leading manufacturers of
enterprise, consumer, industrial, mobile, telecommunications, automotive, and
computer products. Corporation headquarters and state-of-the-art wafer
fabrication facilities are located in San Jose, CA, with regional sales and
support offices and advanced technology design centers situated throughout the
Americas, Europe and Asia. In addition, the Company maintains an extensive
network of distributors and sales representatives worldwide.
For further information, contact Richard Crowley at: Micrel, Incorporated,
2180 Fortune Drive, San Jose, California, 95131, (408) 944-0800; or visit our
website at: http://www.micrel.com.
-Financial Tables to Follow
MICREL REPORTS FIRST QUARTER 2007 RESULTS
April 25, 2007
Page 5 of 6
MICREL, INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
---------------------------------
March 31, December 31, March 31,
2007 2006 2006
--------- --------- ---------
Net revenues $ 63,113 $ 64,482 $ 68,151
Cost of revenues(1) 26,426 27,555 28,257
--------- --------- ---------
Gross profit 36,687 36,927 39,894
Operating expenses:
Research and development(1) 13,252 12,813 13,038
Selling, general and administrative(1) 12,137 11,485 13,411
Other operating expense (income) -- 53 --
Restructuring expense 44 168 --
--------- --------- ---------
Total operating expenses 25,433 24,519 26,449
--------- --------- ---------
Income from operations 11,254 12,408 13,445
Other income (expense):
Interest Income 1,501 1,426 1,411
Interest Expense (152) (146) (163)
Other income 15,514 8 4
--------- --------- ---------
Total other income (expense) 16,863 1,288 1,252
--------- --------- ---------
Income before income taxes 28,117 13,696 14,697
Provision for income taxes 10,249 4,883 5,996
--------- --------- ---------
Net income $ 17,868 $ 8,813 $ 8,701
========= ========= =========
Net income per share:
Basic $ 0.23 $ 0.11 $ 0.10
========= ========= =========
Diluted $ 0.23 $ 0.11 $ 0.10
========= ========= =========
Shares used in computing per share amounts:
Basic 77,738 78,372 84,025
========= ========= =========
Diluted 78,750 79,476 85,794
========= ========= =========
(1) Includes amortization of stock-based
compensation as follows:
Cost of revenues $ 302 $ 353 $ 182
Research and development 479 497 1,065
Selling, general and administrative 489 591 1,109
MICREL REPORTS FIRST QUARTER 2007 RESULTS
April 25, 2007
Page 6 of 6
MICREL, INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
March 31, December 31,
2007 2006
---------- ----------
ASSETS
CURRENT ASSETS:
Cash, cash equivalents, restricted cash
and short-term investments $ 129,832 $ 109,938
Accounts receivable, net 33,781 31,092
Inventories 36,200 37,183
Deferred income taxes 24,127 23,096
Other current assets 2,616 3,084
---------- ----------
Total current assets 226,556 204,393
PROPERTY, PLANT AND EQUIPMENT, NET 77,795 78,665
INTANGIBLE ASSETS, NET 4,301 4,714
DEFERRED INCOME TAXES(1) 8,091 11,158
OTHER ASSETS 1,351 1,343
---------- ----------
TOTAL $ 318,094 $ 300,273
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 15,645 $ 17,429
Taxes payable(1) 4,768 --
Deferred income on shipments to distributors 23,257 21,705
Other current liabilities 20,671 22,564
Current portion of long-term debt 41 80
---------- ----------
Total current liabilities 64,382 61,778
LONG-TERM TAXES PAYABLE(1) 2,132 --
OTHER LONG-TERM OBLIGATIONS 450 453
SHAREHOLDERS' EQUITY:
Common stock 10,804 15,585
Deferred stock compensation -- --
Accumulated other comprehensive loss (34) (35)
Retained earnings 240,360 222,492
---------- ----------
TOTAL SHAREHOLDERS' EQUITY 251,130 238,042
---------- ----------
TOTAL $ 318,094 $ 300,273
========== ==========
(1) On January 1, 2007, Micrel adopted FASB Interpretation No. 48, Accounting
for Uncertainty in Income Taxes ("FIN 48"). Implementation of FIN 48
resulted in a $2.1 million reclassification from current taxes payable to
long-term taxes payable and an additional $2.5 million was reclassified
from current taxes payable to reduce long term deferred tax assets.