EXHIBIT 99.1
TRIDENT MICROSYSTEMS REPORTS FINANCIAL RESULTS FOR
FOURTH QUARTER AND FISCAL YEAR 2004
DIVERSIFICATION OF OEM CUSTOMER BASE MAKING BUSINESS
STRONGER; STRONG GROWTH OUTLOOK FOR
FISCAL 2005
Sunnyvale, Calif., --- July 22, 2004: Trident Microsystems, Inc. (NASDAQ: TRID)
reported today its financial results for the fourth quarter and fiscal year
ended June 30, 2004. The Company announced that its net sales for the fourth
quarter of fiscal 2004 were $12,646,000 compared to $14,620,000 in sales
reported for the fourth quarter of fiscal 2003. The company announced net sales
for all of fiscal 2004 of $52,551,000 as compared to $ 52,752,000 for fiscal
2003. The year ago periods included sales of graphics products, a business which
was divested during the quarter ended September 30, 2003. Sales of digital media
products by Trident Technologies , Inc.("TTI"), an 83% owned subsidiary
comprised $12,301,000 for the fourth quarter and $50,119,000 for the fiscal year
ended June 30, 2004 which represents an approximate doubling of the digital
media business revenues of $5,666,000 and $25,875,000 reported for the
comparable periods one year ago.
Net income for the fourth quarter and fiscal year ended June 30, 2004, on a
generally accepted accounting principles (GAAP) basis, after taking into account
minority ownership of TTI, was $989,000 or $0.04 per fully diluted share, and $
9,588,000 or $0.38 per fully diluted share respectively. Our results for fiscal
2004 are comprised almost entirely of our Digital Media operations and exclude a
graphics business which was previously losing money and effectively divested at
the end of fiscal 2003. As a basis for comparison one year ago the company
reported net losses on a GAAP basis of $ 4,589,000 or $0.22 per share for the
fourth quarter, and $24,764,000 or $ 1.21 per share for the fiscal year ended
June 30, 2003.
Pro forma net income for the fourth quarter and 2004 fiscal year, which excludes
gains on the sale of certain securities ($ 733,000 for the quarter and
$7,624,000 for the year, net of the associated tax effect), as well as
amortization of deferred compensation expense ($214,000 for the quarter and $
606,000 for the year), was $ 470,000 or $0.02 per fully diluted share for the
fourth quarter and $2,570,000 or $0.10 per fully diluted share for the fiscal
year ended June 30, 2004. As a basis of comparison one year ago the company's
loss on a pro forma basis would have been $4,381,000 or $0.21 per share for the
quarter and a pro forma loss of $18,723,000 or $0.91 per share for fiscal year
ended June 30, 2003.
"As expected, due to inventory buildup in one of our key customers, we finished
the June quarter a little below our initial projections," said Frank Lin,
Trident's President and CEO. "While we are not satisfied with the results, we
believe it was an aberration. Going forward, we want to reiterate that our
business outlook is very strong with forecasted sequential revenue growth in the
September quarter in a range approximating
30%. With Trident's strong fundamentals and upcoming LCDTV, digital CRT, HDTV
and notebook PC market opportunities, we are poised to grow revenue and expand
market share in fiscal 2005."
"During the June quarter we diversified our customer base making our Digital
Media business much stronger. We were excited to see a new top tier OEM in Japan
launched and began to ramp its 20" & 14" LCDTV's worldwide using our PanelTV-SVP
chip. Also, we announced Toshiba's Dynabook design-win using our PanelTV-SVP
chip to bring LCDTV and instant-on features into the mainstream consumer
notebook product line. This is an additional market space which we believe has
great potential once the new product concept is embraced and the new LCDTV and
instant on features become a standard requirement. Following the great success
of PanelTV-SVP, we have also started sampling our next generation chip, SVP-EX,
in the June quarter. This is the first chip in the industry to integrate a
high-performance 10-bit ADC, 2D/3D digital comb color-decoder, de-interlacer,
and high-quality scaler into a single chip. The high integration level and
superb video quality has set a new standard in the advanced TV market. This chip
has been very well received by the market and regarded by many top-tier OEM's as
the best chip available for the mainstream advanced TV market segment. With the
SVP-EX, we have even greater confidence to continue our success in penetrating
the top-tier captive OEM markets."
About Pro Forma adjustments
To supplement the consolidated financial results prepared under generally
accepted accounting principles ("GAAP"), Trident uses a non-GAAP conforming, or
pro forma measure of net income that is GAAP net income adjusted to exclude
certain costs, expenses and gains. Pro forma net income gives an indication of
Trident's baseline performance before gains, losses or other charges that are
considered by management to be outside the company's core operating results. In
addition, pro forma net income is among the primary indicators management uses
as a basis for planning and forecasting future periods. These measures are not
in accordance with, or an alternative for, GAAP and may be materially different
from pro forma measures used by other companies. Trident computes pro forma net
income by adjusting GAAP net income for the impact of certain investment gains
and excluding amortization of deferred stock compensation. A reconciliation
between net income on a GAAP basis and pro forma net income is provided in a
table following pro forma consolidated financial statements.
Webcast, Teleconference and Taped Replay
The Company also announced that it will hold a conference call to discuss the
earnings, which will occur on Thursday, July 22, 2004 at 2:30 p.m. Pacific Time
(5:30 p.m. Eastern Time). Shareholders may participate in the call by calling
800-299-0433 (U.S.), or 617-801-9712 (International) passcode 34375851. The
conference call will also be webcast by CCBN and can be accessed at Trident's
web site at: http://www.tridentmicro.com. A replay of the conference call will
be available from 7:30 p.m. July 22, 2004 until
midnight July 29, 2004, and can be accessed by calling 888-286-8010 (U.S.), or
617-801-6888 (International) using passcode 52281957.
Forward-Looking Information
This press release contains forward-looking statements, including statements
which use the words "expect," "hope," "anticipate," "believe," "potential" and
similar words, including our statements regarding financial expectations and our
expectations regarding product developments and design-wins. The forward-looking
statements above are subject to certain risks, and actual results could vary
materially depending on a number of factors. These risks include, in particular,
changes in trends in the DPTV industries, changes in targeted consumer
electronics markets such as Digital Television, whether the Company is able to
achieve timely product introductions, the failure to obtain design wins among
major OEMs for the Company products, and competitive pressures, including
pricing and competitors' new product introductions. Additional factors that may
affect the Company's business are described in detail in the Company's filings
with the Securities and Exchange Commission.
ABOUT TRIDENT MICROSYSTEMS, INC.
Trident Microsystems, Inc., with headquarters in Sunnyvale, California, designs,
develops and markets digital media for the masses in the form of integrated
circuits (ICs) for CRT TV, LCD TV, PDP TV, HDTV, and digital set-top box.
Trident's products are sold to a network of OEMs, original design manufacturers
and system integrators worldwide. For further information about Trident and its
products, please consult the company's web site: http://www.tridentmicro.com.
Trident is a registered trademark of Trident Microsystems, Inc. All other
company and product names are trademarks and/or registered trademarks of their
respective owners. Features, pricing, availability and specifications are
subject to change without notice.
FOR PRESS RELEASES:
Trident Microsystems, Inc.
Investor Relations
Tel: (408) 991-8090
Email: Investor@tridentmicro.com
Web site: http://www.tridentmicro.com
Trident Microsystems, Inc.
Consolidated Statement of Operations
Three Months Ended Twelve Months Ended
----------------------------------------------------------------------
June 30, March 31, June 30, June 30, June 30,
(in thousands, except per share data, unaudited) 2004 2004 2003 2004 2003
- ---------------------------------------------------------------------------------------------------------------------------
Net revenues $ 12,646 $ 13,846 $ 14,620 $ 52,551 $ 52,752
Cost of revenue 5,498 6,014 11,730 23,674 37,720
----------------------------------------------------------------------
Gross profit 7,148 7,832 2,890 28,877 15,032
% of net revenues 56.5% 56.6% 19.8% 55.0% 28.5%
Research and development expenses 3,599 3,129 4,566 11,475 21,600
% of net revenues 28.5% 22.6% 31.2% 21.8% 40.9%
Selling, general and administrative expenses 2,739 3,522 2,786 12,968 11,886
% of net revenues 21.7% 25.4% 19.1% 24.7% 22.5%
----------------------------------------------------------------------
Income (loss) from operations 810 1,181 (4,462) 4,434 (18,454)
% of net revenues 6.4% 8.5% (30.5)% 8.4% (35.0)%
Gain(loss) on investments, net 733 1,941 (208) 9,794 (4,995)
Interest and other income(expense), net 152 137 81 (104) (269)
Minority interests in subsidiaries (508) (539) - (1,832) -
----------------------------------------------------------------------
Income(loss) before income taxes 1,187 2,720 (4,589) 12,292 (23,718)
% of net revenues 9.4% 19.6% (31.4)% 23.4% (45.0)%
Provision for income taxes 198 231 - 2,704 1,046
% of net revenues 1.6% 1.7% 0.0% 5.1% 2.0%
----------------------------------------------------------------------
Net income(loss) $ 989 $ 2,489 $ (4,589) $ 9,588 $ (24,764)
% of net revenues 7.8% 18.0% (31.4)% 18.2% (46.9)%
----------------------------------------------------------------------
Basic net income (loss) per share $ 0.04 $ 0.11 $ (0.22) $ 0.43 $ (1.21)
----------------------------------------------------------------------
Common shares used in computing basic
per share amounts 22,850 22,715 20,675 22,349 20,525
----------------------------------------------------------------------
Diluted net income (loss) per share $ 0.04 $ 0.10 $ (0.22) $ 0.38 $ (1.21)
----------------------------------------------------------------------
Common and common equivalent shares used
in computing diluted per share amounts 25,265 25,275 20,675 25,011 20,525
----------------------------------------------------------------------
Trident Microsystems, Inc.
Pro Forma Consolidated Statement of Operations
Three Months Ended Twelve Months Ended
----------------------------------------------------------------------
June 30, March 31, June 30, June 30, June 30,
(in thousands, unaudited) 2004 2004 2003 2004 2003
- ---------------------------------------------------------------------------------------------------------------------
Net revenues $ 12,646 $ 13,846 $ 14,620 $ 52,551 $ 52,752
Cost of revenue 5,498 6,014 11,730 23,674 37,720
----------------------------------------------------------------------
Gross profit 7,148 7,832 2,890 28,877 15,032
% of net revenues 56.5% 56.6% 19.8% 55.0% 28.5%
Research and development expenses 3,536 3,106 4,566 11,351 21,600
% of net revenues 28.0% 22.4% 31.2% 21.6% 40.9%
Selling, general and administrative expenses 2,588 3,398 2,786 12,486 11,886
% of net revenues 20.5% 24.5% 19.1% 23.8% 22.5%
----------------------------------------------------------------------
Income (loss) from operations 1,024 1,328 (4,462) 5,040 (18,454)
% of net revenues 8.1% 9.6% (30.5)% 9.6% (35.0)%
Interest and other income(expense), net 152 137 81 (104) (269)
Minority interests in subsidiaries (508) (539) - (1,832) -
----------------------------------------------------------------------
Income(loss) before income taxes 668 926 (4,381) 3,104 (18,723)
% of net revenues 5.3% 6.7% (30.0)% 5.9% (35.5)%
Provision for income taxes 198 231 - 534 -
% of net revenues 1.6% 1.7% 0.0% 1.0% 0.0%
----------------------------------------------------------------------
Net income(loss) $ 470 $ 695 $ (4,381) $ 2,570 $ (18,723)
% of net revenues 3.7% 5.0% (30.0)% 4.9% (35.5)%
----------------------------------------------------------------------
Basic net income (loss) per share $ 0.02 $ 0.03 $ (0.21) $ 0.11 $ (0.91)
----------------------------------------------------------------------
Common shares used in computing basic per
share amounts 22,850 22,715 20,675 22,349 20,525
----------------------------------------------------------------------
Diluted net income (loss) per share $ 0.02 $ 0.03 $ (0.21) $ 0.10 $ (0.91)
----------------------------------------------------------------------
Common and common equivalent shares used in
computing diluted per share amounts 25,265 25,275 20,675 25,011 20,525
----------------------------------------------------------------------
A reconciliation between net income (loss) on a GAAP basis
and pro forma net income (loss) is as follows:
Three Months Ended Twelve Months Ended
------------------------------------------------------------------
June 30, March 31, June 30, June 30, June 30,
(in thousands, except per share data, unaudited) 2004 2004 2003 2004 2003
- -----------------------------------------------------------------------------------------------------------------------
GAAP net income (loss) $ 989 $ 2,489 $ (4,589) $ 9,588 $ (24,764)
Amortization of stock based compensation 214 147 - 606 -
(Gain) loss on investments, net (733) (1,941) 208 (9,794) 4,995
Income taxes on investments - - - 2,170 1,046
------------------------------------------------------------------
Pro forma net income (loss) $ 470 $ 695 $ (4,381) $ 2,570 $ (18,723)
==================================================================
Trident Microsystems, Inc.
Consolidated Balance Sheet
June 30, March 31, June 30,
(in thousands, unaudited) 2004 2004 2003
- ---------------------------------------------------------------------------------------------------
ASSETS
Current assets
Cash and cash equivalents $ 32,488 $ 29,179 $ 5,085
Short-term investment - UMC 51,843 64,338 43,541
Short-term investments - other 0 26 1,241
Accounts receivable, net 2,436 3,121 4,338
Inventories 2,737 3,391 2,318
Prepaid expenses and other current assets 1,087 1,240 734
Assets held for sale - - 1,800
--------------------------------------------
Total current assets 90,591 101,295 59,057
Property and equipment, net 2,372 2,282 2,789
Long-term investment - UMC - - 4,375
Long-term investments - other 2,720 2,950 3,569
Other assets 573 408 333
--------------------------------------------
Total assets $ 96,256 $ 8106,935 $ 70,123
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 3,180 $ 4,458 $ 7,974
Accrued liabilities 8,287 8,592 8,332
Deferred tax liabilities 2,694 7,175 -
Income taxes payable 4,260 4,062 1,580
--------------------------------------------
Total current liabilities 18,421 24,287 17,886
Minority interests, in subsidiaries 4,023 3,515 77
--------------------------------------------
Total liabilities 22,444 27,802 17,963
Stockholders' equity
Capital stock 48,453 47,895 39,800
Deferred stock based compensation (2,687) (2,541) -
Retained earnings 24,159 23,171 14,581
Accumulated other comprehensive income (loss) 3,887 10,608 (2,221)
--------------------------------------------
Total stockholders' equity 73,812 79,133 52,160
--------------------------------------------
Total liabilities and stockholders' equity $ 96,256 $ 5106,935 $ 70,123
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