EXHIBIT 99
[ON logo appears here]
Everett Tackett, APR Rudy Garcia
Director Public Relations Director Investor Relations
ON Semiconductor ON Semiconductor
(602) 244-4534 (602) 244-3437
everett.tackett@onsemi.com rudy.garcia@onsemi.com
ON SEMICONDUCTOR ANNOUNCES FIRST QUARTER RESULTS AND PROVIDES SECOND
QUARTER GUIDANCE
- Total Revenues Up From Prior Quarter, Exceeds Guidance
- Backlog Up 12% From Prior Quarter
- Gross Margin Improved From 14% to 22% Sequentially
- EBITDA Up By $18 Million From Prior Quarter
PHOENIX, ARIZ. - APRIL 17, 2002 - - ON Semiconductor Corporation (Nasdaq: ONNN)
today announced that total revenues in the first quarter of 2002 were $269
million, a sequential increase from the fourth quarter of 2001, exceeding
previous guidance of sequentially flat to slightly down. The Company had a pro
forma net loss, excluding restructuring charges, of $43 million, or $0.26 per
share, in the first quarter of 2002, ahead of First Call's consensus loss
estimate of $0.31 per share. During the first quarter of 2002, restructuring
charges of $7 million were incurred primarily associated with previously
announced workforce reductions in Europe. Including restructuring charges, the
Company reported a net loss of $50 million, or $0.30 per share, in the first
quarter of 2002. EBITDA (as defined below) was $29 million in the first quarter
of 2002 as compared to $11 million in the fourth quarter of 2001.
Gross margin improved to 22 percent in the first quarter, up from 14
percent in the prior quarter, as further cost reductions were realized and
factory utilization improved to over 65 percent in the first quarter from
approximately 50 percent in the fourth quarter of 2001. The Company is on track
to complete actions by the end of 2002 that it currently expects to generate
approximately $360 million of annualized cost savings, as compared to its cost
structure as of the first quarter of 2001. As of the end of the first quarter of
2002, the Company completed actions to achieve an estimated $290 million of
these savings.
Backlog at the end of the first quarter of 2002 was $223 million, an
increase of $24 million from the end of fourth quarter of 2001. "The market
continues to provide us with strong indications of
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stabilization," said Steve Hanson, ON Semiconductor president and CEO. "We have
capitalized on this trend with an initiative targeting the PC market that
provides our customers with advanced analog ICs as well as the critical MOS
power devices to complete the system-level solution. Customers such as Astec,
Legend QDI and Samsung are designing our parts into some of their most advanced
offerings. To demonstrate our commitment to this market, we introduced several
exciting new devices. Using our MicroIntegration(TM) process, we introduced a
USB compatible protection filter. Alcatel is using this part in its latest DSL
modem. The success of this initiative spilled over into other markets as well.
This quarter, we announced significant design wins at TCL, China's largest
television manufacturer, and Hi-Tech, China's largest producer of PDAs."
"We have become a different company over the course of the previous year and
strengthened our leadership team that will chart the direction of our new
company," Hanson added. "Syrus Madavi is now our executive chairman and chairman
of the board. John Kurtzweil has joined us as senior vice president, CFO and
treasurer and Bill Bradford recently came aboard as senior vice president of
sales and marketing. Our ability to attract this high-level talent clearly
reflects the great potential of our company. All of this is happening at the
right time; backlog is up from the prior quarter and consumer confidence is
rising. We are preparing for the increase in demand that we expect to follow."
"Regarding our second quarter outlook, we expect revenues and margins to
show sequential improvement again with the continued strength of orders,
particularly in Asia, and further execution on our cost saving activities. We
anticipate total revenues to be between $270-$275 million in the second quarter
with gross margins increasing to 25-27 percent and operating expenses remaining
flat to slightly down from the first quarter. At these revenue and expense
levels for the second quarter, we expect to reduce the loss per share to
$0.20-$0.24. EBITDA is expected to be in the range of $45-$50 million." EBITDA
represents net income (loss) before interest expense, provision for income
taxes, depreciation and amortization expense, restructuring and other charges
and minority interests.
"With improving financials and our continued focus on providing power and
data management solutions, we are excited about strengthening our competitive
position as the market begins to recover," Hanson said.
ABOUT ON SEMICONDUCTOR
ON Semiconductor (Nasdaq: ONNN) offers an extensive portfolio of power and data
management semiconductors and standard semiconductor components that address the
design needs of today's
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sophisticated electronic products, appliances and automobiles. For more
information visit ON Semiconductor's Web site at http://www.onsemi.com.
# # #
ON Semiconductor and the ON Semiconductor logo are registered trademarks of
Semiconductor Components Industries, LLC. All other brand and product names
appearing in this document are registered trademarks or trademarks of their
respective holders. Although the company references its Web site in this news
release, such information on the Web site is not to be incorporated herein.
This news release includes "forward-looking statements" as that term is defined
in Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements other than statements of historical fact
are statements that could be deemed forward-looking statements and are often
characterized by the use of words such as "believes," "expects," "estimates,"
"projects," "may," "will," "intends," "plans," or "anticipates," or by
discussions of strategy, plans or intentions. In this news release,
forward-looking information relates to second quarter 2002 total revenues, gross
margin, loss per share, EBITDA, cost reductions and similar matters. All
forward-looking statements in this news release are made based on management's
current expectations and estimates, which involve risks, uncertainties and other
factors that could cause results to differ materially from those expressed in
forward-looking statements. Among these factors are our recently incurred
substantial operating losses and anticipated future losses, changes in overall
economic conditions, the cyclical nature of the semiconductor industry, changes
in demand for our products, changes in inventories at our customers and
distributors, technological and product development risks, availability of
manufacturing capacity, availability of raw materials, competitors' actions,
loss of key customers, order cancellations or reduced bookings, changes in
manufacturing yields, restructuring programs and the impact of such programs,
control of costs and expenses, inability to reduce manufacturing and general and
administrative costs, litigation, risks associated with acquisitions and
dispositions, changes in management, risks associated with our substantial
leverage and restrictive covenants in our debt agreement (including those
relating to the increased cost of servicing our debt and complying with the
additional restrictions imposed as a result of the August 2001 amendment to our
senior credit facilities), possible future delisting of our common stock by
Nasdaq, risks associated with our international operations, terrorist activities
both in the United States and internationally, and risks involving environmental
or other governmental regulation. Additional factors that could affect the
company's future operating results are described in our Form 10-K for the year
ended December 31, 2001 under the caption "Trends, Risk and Uncertainties" in
the MD&A section, and other factors are described from time to time in our SEC
filings. Readers are cautioned not to place undue reliance on forward-looking
statements. We assume no obligation to update such information.
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ON SEMICONDUCTOR
UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS
(in millions, except per share data)
THREE MONTHS ENDED
MARCH 29, DECEMBER 31, MARCH 30,
2002 2001 2001
--------- ------------ ---------
Total revenues $ 269.1 $ 266.9 $ 360.5
Cost of sales 210.9 230.2 273.9
--------- ------------ ---------
Gross profit 58.2 36.7 86.6
--------- ------------ ---------
Operating expenses:
Research and development 17.3 17.0 22.9
Selling and marketing 14.6 15.4 23.8
General and administrative 29.2 26.6 36.8
Amortization of goodwill and other intangibles 3.0 5.6 5.8
Restructuring and other charges 7.1 16.6 38.0
--------- ------------ ---------
Total operating expenses 71.2 81.2 127.3
--------- ------------ ---------
Operating loss (13.0) (44.5) (40.7)
--------- ------------ ---------
Other income (expenses), net:
Interest expense (34.7) (40.1) (29.2)
Equity in earnings of joint ventures 1.2 0.8 0.6
Gain on sale of investment in joint venture -- -- 3.1
--------- ------------ ---------
Other income (expenses), net (33.5) (39.3) (25.5)
--------- ------------ ---------
Loss before income taxes, minority interests and
cumulative effect of accounting change (46.5) (83.8) (66.2)
Income tax (provision) benefit (3.7) (368.4) 22.7
Minority interests 0.2 1.3 0.5
--------- ------------ ---------
Net loss before cumulative effect of accounting change (50.0) (450.9) (43.0)
Cumulative effect of accounting change (net of tax) -- -- (116.4)
--------- ------------ ---------
Net loss (50.0) (450.9) (159.4)
Less: Redeemable preferred stock dividends (2.1) (1.9) --
--------- ------------ ---------
Net loss available for common stock $ (52.1) $ (452.8) $ (159.4)
========= ============ =========
Loss per common share:
Basic:
Net loss before cumulative effect of accounting change $ (0.30) $ (2.60) $ (0.25)
Cumulative effect of accounting change -- -- (0.67)
--------- ------------ ---------
Net loss $ (0.30) $ (2.60) $ (0.92)
========= ============ =========
Diluted:
Net loss before cumulative effect of accounting change $ (0.30) $ (2.60) $ (0.25)
Cumulative effect of accounting change -- -- (0.67)
--------- ------------ ---------
Net loss $ (0.30) $ (2.60) $ (0.92)
========= ============ =========
Weighted average common shares outstanding:
Basic 174.8 174.3 172.8
========= ============ =========
Diluted 174.8 174.3 172.8
========= ============ =========
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ON SEMICONDUCTOR
CONSOLIDATED BALANCE SHEETS
(in millions)
MARCH 29, DECEMBER 31,
2002 2001
--------- ------------
(UNAUDITED)
ASSETS
Cash and cash equivalents $ 147.6 $ 179.8
Receivables, net 152.7 142.3
Inventories, net 170.2 183.7
Other current assets 46.1 45.0
--------- ------------
Total current assets 516.6 550.8
Property, plant and equipment, net 528.6 555.5
Investments in joint ventures 33.3 32.1
Goodwill and other intangibles, net 114.3 117.2
Other assets 101.8 104.8
--------- ------------
Total assets $ 1,294.6 $ 1,360.4
========= ============
LIABILITIES, MINORITY INTERESTS, REDEEMABLE PREFERRED STOCK
AND STOCKHOLDERS' DEFICIT
Accounts payable $ 111.9 $ 111.5
Accrued expenses 108.9 111.6
Deferred income on sales to distributors 78.1 99.4
Current portion of long-term debt 12.6 12.4
--------- ------------
Total current liabilities 311.5 334.9
Long-term debt 1,372.8 1,374.5
Other long-term liabilities 68.3 62.7
--------- ------------
Total liabilities 1,752.6 1,772.1
--------- ------------
Minority interests in consolidated subsidiaries 3.9 4.1
--------- ------------
Redeemable preferred stock 103.7 101.6
Common stock 1.8 1.7
Additional paid-in capital 738.1 738.8
Accumulated other comprehensive income (30.4) (32.8)
Accumulated deficit (1,275.1) (1,225.1)
--------- ------------
Total stockholders' deficit (565.6) (517.4)
--------- ------------
Total liabilities, minority interests and
stockholders' deficit $ 1,294.6 $ 1,360.4
========= ============
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