Exhibit 99.1
FOR RELEASE: NOVEMBER 18, 2003
4:00 P.M. EST
ANALOG DEVICES REPORTS RESULTS
FOR THE FOURTH QUARTER AND FISCAL YEAR 2003
NORWOOD, Massachusetts - Analog Devices, Inc. (NYSE: ADI), a global leader in
high-performance semiconductors for signal processing applications, today
announced revenues of $558 million for the fourth quarter of fiscal 2003, an
increase of 22% compared to the same quarter one year ago and 7% above the
immediately prior quarter.
Diluted earnings per share (EPS) under generally accepted accounting principles
(GAAP) was $0.23 for the fourth quarter, up from $0.09 for the same period one
year ago and $0.21 for the third quarter of fiscal 2003. The fourth quarter
results include a restructuring charge of $9.2 million ($0.02 per share) related
to the decision to exit a small manufacturing business in Europe that was
supplying foundry substrate services for optical applications. Excluding this
charge, the diluted EPS would have been $0.25 for the fourth quarter.
Revenues for the fiscal year 2003, which ended November 1, 2003, were $2.05
billion, up 20% year-over-year. Fiscal 2003 diluted EPS increased to $0.78, up
from the fiscal 2002 EPS of $0.28.
"The fourth quarter wrapped up what turned out to be a great year for ADI," said
Mr. Jerald G. Fishman, president and CEO. "Continuing strong orders led to
fourth-quarter revenues coming in higher than we had anticipated at the
beginning of the quarter, with substantial contributions from both analog and
DSP products.
"In the fourth quarter, orders for shipment in the next 13 weeks grew by
approximately 30% from the prior quarter. Orders grew in every region of the
world and in both the distributor and OEM channels. Order growth continued to be
the strongest in Asia as the digital consumer, wireless terminal and PC markets
all posted strong results. We also saw strong demand from our broad base of
customers serving all other end markets.
"Gross margins for the fourth quarter of fiscal 2003 increased to 55.8% of
sales, up from 55.1% of sales in the prior quarter. Days cost of sales in
inventory fell to 106 days in the fourth quarter compared to 116 days in the
previous quarter."
Commenting on the balance sheet Mr. Fishman said, "The balance sheet continued
to strengthen during the fourth quarter. Cash from operations was $105 million
and capital expenditures were limited to $18 million, resulting in `free cash
flow' of $87 million. During the quarter we redeemed our $1.2 billion of
convertible debt and ended the quarter with $2.1 billion of cash and short-term
investment balances and no debt."
Regarding the near-term outlook, Mr. Fishman said, "We are planning for the
recovery that began seven quarters ago for ADI to continue in the first quarter
of fiscal 2004. Demand accelerated during the fourth quarter and we are entering
the first quarter with the highest level of backlog we have seen over the last
two years. As a result, we are planning for revenues to grow approximately 5%
sequentially and for EPS to be in the range of $0.27 to $0.28 in the first
quarter of fiscal 2004."
In a separate press release issued today, the company announced that the Board
of Directors of ADI declared a cash dividend of $0.04 per outstanding share of
common stock. The dividend will be paid on December 17, 2003 to all stockholders
of record at the close of business on November 28, 2003.
Mr. Fishman will discuss the fourth quarter's results and the near-term outlook
via webcast, accessible from www.analog.com, today beginning at 4:30pm EST.
Investors who prefer to join by telephone may call 706-634-7544 ten minutes
before the call begins and provide the password "ADI."
A replay will be available almost immediately after the call. The replay may be
accessed for up to one week by dialing 800-642-1687 (replay only) and providing
the conference ID: 3205589 or by visiting the Investor Relations page on ADI's
web site.
Non-GAAP Data
The Company has presented diluted earnings per share net of the restructuring
charge discussed above. The Company believes that this data reflects results for
the Company's normal business operations and facilitates comparisons to prior
periods.
Analog Devices, Inc. is a leading manufacturer of precision high-performance
integrated circuits used in analog and digital signal processing applications.
ADI is headquartered in Norwood, Massachusetts, and employs approximately 8,400
people worldwide. It has manufacturing facilities in Massachusetts, California,
North Carolina, Ireland, the Philippines, and the United Kingdom. Analog
Devices' common stock is listed on the New York Stock Exchange and ADI is
included in the S&P 500 Index.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: This press release contains forward-looking statements, including our
statements regarding planned revenues, earnings and operating margins, that are
based on our current expectations, beliefs, assumptions, estimates, forecasts
and projections about the industry and markets in which Analog Devices operates.
The statements contained in this release are not guarantees of future
performance and involve certain risks, uncertainties and assumptions that are
difficult to predict. Therefore, actual outcomes and results may differ
materially from what is expressed in such forward-looking statements, and such
statements should not be relied upon as representing Analog Devices'
expectations or beliefs as of any date subsequent to the date of this press
release. Important factors that may affect future operating results include the
effects of adverse changes in overall economic conditions, currency exchange
rate fluctuations, the timing and duration of market upturns and downturns, the
growth or contraction of the markets we serve, demand for semiconductors
generally and for our products in particular, the risk that our backlog
could decline significantly, our ability to hire engineers and other qualified
employees needed to meet the expected demands of our largest customers,
reversals or slowdowns in the markets or customers served by our products, the
adverse effects of building inventories to meet planned growth that fails to
materialize, the occurrence and frequency of inventory and lead-time reduction
cycles, raw material availability, availability of both internal and external
manufacturing capacity, technological and product development risks,
competitors' actions and technological innovations and other risk factors
described in our Quarterly Report on Form 10-Q for the fiscal quarter ended
August 2, 2003, as filed with the Securities and Exchange Commission.
CONTACT: Maria Tagliaferro, Director of Corporate Communications at Analog
Devices, 781-461-3282, or investor.relations@analog.com
ANALOG DEVICES SUPPLEMENTAL INFORMATION, FOURTH QUARTER, FISCAL 2003
SALES/EARNINGS SUMMARY
(IN THOUSANDS OF DOLLARS, EXCEPT PER-SHARE AMOUNTS)
4Q 03 3Q 03 4Q 02
Three Months Ended Nov 1, 2003 Aug 2, 2003 Nov 2, 2002
----------- ----------- -----------
Net Sales $ 557,517 $ 520,445 $ 455,718
Y/Y Growth 22% 17% 8%
Q/Q Growth 7% 4% 2%
Cost of Sales 246,605 233,846 213,084
Gross Margin 310,912 286,599 242,634
Percent of Sales 55.8% 55.1% 53.2%
--------- --------- ---------
Operating Expenses:
R&D 112,418 111,668 107,104
Selling, Marketing and G&A 75,007 72,178 69,204
Acquisition-related expenses* 2,664 2,660 16,402
Restructuring Costs 9,193 341 6,315
Investment Impairment -- -- 2,090
--------- --------- ---------
Operating Income 111,630 99,752 41,519
Other (Income) Expense (649) (1,474) (4,841)
--------- --------- ---------
Income Before Tax 112,279 101,226 46,360
Provision for Taxes 24,252 22,270 11,590
Tax Rate 22% 22% 25%
--------- --------- ---------
Net Income $ 88,027 $ 78,956 $ 34,770
--------- --------- ---------
Shares used for EPS - Basic 368,511 366,025 364,019
Shares used for EPS - Diluted 387,381 384,166 377,285
Earnings per Share - Basic $ 0.24 $ 0.22 $ 0.10
Earnings per Share - Diluted $ 0.23 $ 0.21 $ 0.09
--------- --------- ---------
* Acquisition-related goodwill is no longer amortized effective November 3,
2002, in accordance with FAS 142.
Twelve Months Ended Nov 1, 2003 Nov 2, 2002
----------- -----------
Net Sales $ 2,047,268 $ 1,707,508
Y/Y Growth 20% -25%
Cost of Sales 923,160 802,980
Gross Margin 1,124,108 904,528
Percent of Sales 54.9% 53.0%
----------- -----------
Operating Expenses:
R&D 442,025 410,116
Selling, Marketing and G&A 288,009 257,054
Acquisition-related expenses* 10,831 70,626
Restructuring Costs 9,534 37,399
Investment Impairment -- 7,669
Goodwill Impairment -- 3,426
----------- -----------
Operating Income 373,709 118,238
Other (Income) Expense (8,127) (22,112)
----------- -----------
Income Before Tax 381,836 140,350
Provision for Taxes 83,555 35,051
Tax Rate 22% 25%
----------- -----------
Net Income $ 298,281 $ 105,299
----------- -----------
Shares used for EPS - Basic 365,485 364,194
Shares used for EPS - Diluted 382,227 381,245
Earnings per Share - Basic $ 0.82 $ 0.29
Earnings per Share - Diluted $ 0.78 $ 0.28
----------- -----------
* Acquisition-related goodwill is no longer amortized effective November 3,
2002, in accordance with FAS 142.
ANALOG DEVICES SUPPLEMENTAL INFORMATION, FOURTH QUARTER, FISCAL 2003
SELECTED BALANCE SHEET INFORMATION
(IN THOUSANDS OF DOLLARS)
4Q 03 3Q 03 4Q 02
Nov 1, 2003 Aug 2, 2003 Nov 2, 2002
----------- ----------- -----------
Cash & Short-term Investments $2,116,743 $3,229,365 $2,898,023
Accounts Receivable, Net 294,781 259,134 228,338
Inventories 287,502 296,940 306,391
Other Current Assets 186,690 198,554 191,473
---------- ---------- ----------
Total Current Assets 2,885,716 3,983,993 3,624,225
PP&E, Net 671,140 697,841 780,904
Investments 341,573 297,533 279,605
Intangible Assets 172,019 172,673 174,637
Other 22,429 96,028 120,820
---------- ---------- ----------
Total Assets $4,092,877 $5,248,068 $4,980,191
---------- ---------- ----------
Current Liabilities $ 342,132 $ 373,446 $ 373,364
Deferred income-shipments to distributors 121,345 112,607 110,271
Long-term Debt -- 1,263,266 1,274,020
Non-Current Lease Obligations -- 191 467
Non-Current Liabilities 341,326 334,888 322,053
Stockholders' Equity 3,288,074 3,163,670 2,900,016
---------- ---------- ----------
Total Liabilities & Equity $4,092,877 $5,248,068 $4,980,191
---------- ---------- ----------
CAPITAL EXPENDITURES, DEPRECIATION & AMORTIZATION
(IN THOUSANDS OF DOLLARS)
4Q 03 3Q 03 4Q 02
THREE MONTHS ENDED Nov 1, 2003 Aug 2, 2003 Nov 2, 2002
----------- ----------- -----------
Capital Expenditures $ 18,358 $ 20,076 $ 15,930
Depreciation $ 39,320 $ 42,297 $ 48,567
Amortization of Goodwill & Intangibles* $ 660 $ 656 $ 14,207
TWELVE MONTHS ENDED Nov 1, 2003 Nov 2, 2002
----------- -----------
Capital Expenditures $ 67,735 $ 57,412
Depreciation $ 165,659 $ 181,129
Amortization of Goodwill & Intangibles* $ 2,624 $ 56,873
* Acquisition-related goodwill is no longer amortized effective November 3,
2002, in accordance with FAS 142.