EXHIBIT 99.1
Contact: Meghan Dalton Brent Dietz
Intersil Investor Relations Intersil Public Relations
Tel: (321) 729-5738 Tel: (321) 729-5973
E-Mail: mdalton@intersil.com E-Mail: bdietz@intersil.com
Intersil Corporation Announces First Quarter 2003 Financial Results
--Achieves $164.4 million in revenue and grows orders sequentially in all
Product Groups
--Meets revenue and EPS guidance
--Generates more than $34 million in cash flow from operations
MILPITAS, CA, April 23, 2003 - Intersil Corporation (NASDAQ: ISIL), a world
leader in the design and manufacture of high performance analog and wireless
networking solutions, today reported financial results for the first quarter
ended April 4, 2003. On a generally accepted accounting principles (GAAP) basis,
net revenue was $164.4 million, an increase of 23% from the first quarter of
2002. GAAP net income for the first quarter of 2003 was $13.7 million or $0.10
per diluted share. This compares to net income of $13.8 million or $0.13 per
diluted share for the same period a year ago.
Intersil believes that adjusted revenue and earnings information is a more
accurate representation of its quarterly operating performance and has therefore
chosen to provide this information to investors for a more consistent basis of
comparison. Intersil also uses this adjusted information internally to evaluate
and manage the company's operations.
Revenue from ongoing operations, including Elantec(R) for all periods and
excluding Automotive, was $162.2 million, an increase of 10% over the prior year
and a decrease of 1% from the fourth quarter of 2002. Excluding amortization of
intangibles and other one-time items, adjusted net income for the first quarter
was $18.3 million or $0.13 per diluted share of common stock. This compares to
adjusted net income of $17.8 million or $0.13 per diluted share for the first
quarter of 2002.
Q1 Earnings, Page Two
"Our Power Management and Elantec Product Groups both achieved impressive
sequential growth in the first quarter, and we're pleased with Intersil's total
performance during what is historically a seasonally weak quarter for the
industry," said Rich Beyer, Intersil's president and CEO. "Our Wireless
Networking Product Group and total analog business each grew on an annual basis.
Our orders position improved substantially with strong sequential orders growth
in each of our Product Groups."
"Intersil improved gross margins 30 basis points to 53.0% this quarter and our
analog gross margins reached an all-time high," added Beyer. "The company
generated more than $34 million in cash flow from operations and exited the
quarter with a very strong cash and liquid investments position of over $633
million."
Results by Product Group
Revenue for Intersil's Power Management products reached a record $54.3 million
during the first quarter, an increase of 3% from the prior quarter and 26% from
the first quarter of 2002. Intersil's continued expansion from desktop power
management into notebook, portable and peripheral applications helped the
company grow its revenue during a historically soft seasonal quarter. Intersil's
Endura(TM) power management products for notebooks, graphics cards and DDR
memory all experienced significant growth during the first quarter. Intersil
received more orders for notebook products in the first quarter than it had for
all of 2002. Strong design win momentum for Intersil's graphics card and DDR
memory solutions helped the company's market share to grow to more than 50% of
next-generation products. This should help drive continued revenue growth for
Intersil's Power Management Product Group during all of 2003 and beyond.
Q1 Earnings, Page Three
Elantec product sales also increased during the quarter, growing 6% sequentially
and 7% over the first quarter of the prior year to $27.2 million. Revenue growth
for the Elantec Product Group was driven by demand for its laser diode drivers
(LDD) for new DVD recorders, as Intersil continues to benefit from increasing PC
attach rates for DVD recordable drives. The company also experienced increasing
demand for its DSL products and announced during the quarter that it has now
shipped more than 30 million DSL ports since introducing the world's first DSL
line driver in 1995.
Intersil's Standard Analog revenue decreased 1% both sequentially and from the
same quarter of 2002 to $29.8 million. Based upon recent improvement in customer
ordering patterns, there now appears to be some strengthening in the standard
analog demand environment. As a result, Intersil expects a return to sequential
revenue growth in Standard Analog in the second quarter. Intersil continues to
add to its standard analog portfolio with high-precision, low power,
space-saving products such as analog switches for Voice over Broadband and
RS-232/485 interface. The company's focus on portable markets within standard
analog has helped establish Intersil as the number one supplier of analog
multiplexers and number three supplier of analog switches.
As expected, the company reported Automotive product sales of $2.2 million
during the first quarter as Intersil completed its exit of the automotive
business in order to focus on higher growth and more profitable markets.
Intersil's Wireless Networking sales decreased 9% from the previous quarter but
grew 4% year over year to $51.0 million. The sequential decline was primarily
due to seasonal softness within the WLAN market as well as ASP declines in 11
Megabit per second (Mbps) 802.11b. As expected, the market began to shift to
higher data rate 54 Mbps products during the quarter. Lead customers including
D-Link, NETGEAR, SMC, corega and USI have already begun ramping new products
based on Intersil's higher data rate PRISM(R) WLAN solutions, and approximately
20% of the first quarter wireless networking revenue came from these new
products. Intersil also began shipping its new dual band 802.11a, b and g WLAN
solution, PRISM Duette(TM), during the first quarter. Continued strong orders
demand for these new solutions should result in a resumption of wireless
networking growth in the second quarter.
Q1 Earnings, Page Four
Business Outlook
Looking ahead to the second quarter, Beyer said, "Given the increasing strength
in orders in Q1 and our new product launches, we expect to resume sequential
revenue growth in the second quarter. We expect revenue to grow 5 to 7% in the
second quarter to between $172 and $176 million, with all of our product groups
contributing to our growth. We expect earnings to grow faster than revenues, due
to continued improvement in gross margins and continued leveraging of our
operating expenses. We anticipate adjusted earnings per share to increase to
$0.15-$0.16 in the second quarter."
Investors and interested parties within the United States may listen to
Intersil's conference call today at 4:30 p.m. Eastern/1:30 p.m. Pacific by
dialing (877) 709-5342 and providing the operator with the pass code Intersil.
International callers may connect to the call by dialing (630) 395-0024. A
replay of Intersil's conference call will be available for one week beginning
today at 8:00 p.m. Eastern/5:00 p.m. Pacific by calling (800) 839-2313 in the
U.S. or (402) 998-1189 Internationally. Confirmation code for the replay is
Intersil. A live webcast will also be available on Intersil's Investor Relations
homepage at http://www.intersil.com/investor and a replay will be available
until April 30, 2003.
About Intersil
Intersil Corporation is a global semiconductor leader in the design and
manufacture of high performance analog and wireless networking solutions.
Intersil's product portfolios address four fast growing markets - flat panel
displays, optical storage (CD and DVD recordable), power management and wireless
networking. Intersil brings added customer value in providing complete silicon,
software and reference design solutions to new products that enhance the
computing experience for people wherever they live, work or travel. For more
information about Intersil or to find out how to become a member of our winning
team, visit the company's web site and career page at: http://www.intersil.com
Q1 Earnings, Page Five
Intersil Corporation
Financial Summary (Adjusted)
(In millions, except per share amounts and percentages)
Three Months Ended
------------------
April 4, March 29,
2003 2002
On-going product groups $ 162.2 $ 147.4
Automotive 2.2 12.1
--------- ---------
Total Revenue 164.4 159.5
Gross Margin 87.1 84.5
% of Sales 53% 53%
R&D 35.9 32.9
SG&A 28.2 28.7
Operating Income 23.0 22.9
% of Sales 14% 14%
Interest, net (2.1) (2.5)
Pretax Income 25.1 25.4
Net Income 18.3 17.8
% of Sales 11% 11%
Earnings Per Share
Basic $ 0.13 $ 0.13
Diluted $ 0.13 $ 0.13
Weighted Average Shares
Basic 136.6 136.5
Diluted 140.2 141.7
NOTE: This financial summary excludes amortization of intangibles and other
one-time items. The financial summary includes Elantec in all periods. These
adjustments are included in the Financial Highlights table.
Intersil Corporation
Statements of Income
(In millions, except per share amounts)
Three Months Ended
------------------
April 4, March 29,
2003 2002
Revenue
Product sales $ 164.4 $ 134.1
Costs and Expenses
Cost of product sales 77.3 63.0
Research and development 35.9 27.8
Selling, general & administrative 28.2 23.8
Intangible amortization 6.4 2.3
Severance related expenses 1.6 -
---------- ----------
Operating income 15.0 17.2
Interest, net (2.1) (2.6)
---------- ----------
Income before sale of certain operations and income taxes 17.1 19.8
Gain on sale of certain operations disposed of during 2001 1.4 -
---------- ----------
Income before income taxes 18.5 19.8
Income taxes 4.8 6.0
---------- ----------
Net Income $ 13.7 $ 13.8
========== ==========
Earnings Per Share
Basic $ 0.10 $ 0.13
Diluted $ 0.10 $ 0.13
Weighted Average Shares
Basic 136.6 106.9
========== ==========
Diluted 140.2 109.1
========== ==========
Intersil Corporation
Balance Sheets
(In millions)
April 4, January 3,
2003 2003
Assets
Current Assets
Cash & short-term investments $ 533.1 $ 623.6
Trade receivables, net 90.3 93.9
Inventories 99.1 86.0
Prepaid expenses and other current assets 12.8 9.4
Deferred income taxes 30.8 34.3
---------- ----------
Total Current Assets 766.1 847.2
Other Assets
Property, plant & equipment, net 171.1 161.4
Intangibles, net 1,302.5 1,304.4
Deferred income taxes 13.4 15.6
Held-to-maturity investments 100.0 -
Other 43.1 39.9
---------- ----------
Total Other Assets 1,630.1 1,521.3
---------- ----------
Total Assets $ 2,396.2 $ 2,368.5
========== ==========
Liabilities and Shareholders' Equity
Current Liabilities
Trade account payables $ 51.8 $ 37.5
Income taxes payable 39.5 24.4
Deferred revenue 12.2 12.4
Other accrued items 77.0 91.5
---------- ----------
Total Liabilities 180.5 165.8
Total Shareholders' Equity 2,215.7 2,202.7
---------- ----------
Total Liabilities and Shareholders' Equity $ 2,396.2 $ 2,368.5
========== ==========
Intersil Corporation
Financial Highlights
(In millions, except per share amounts)
Adjustments to reconcile reported net income to adjusted net income:
Three Months Ended
------------------
April 4, March 29,
2003 2002
Net income on GAAP basis $ 13.7 $ 13.8
a) Amortization of acquisition-related intangibles 6.4 2.3
b) Severance related expenses 1.6 -
c) Gain on sale of certain operations disposed of during 2001 (1.4) -
d) Income for Elantec prior to acquisition* - 4.3
e) Interest impact on cash used in acquisition - (1.0)
f) Associated tax effects (2.0) (1.6)
-------- --------
Adjusted net income $ 18.3 $ 17.8
======== ========
Diluted adjusted earnings per share $ 0.13 $ 0.13
======== ========
Diluted weighted average common shares outstanding 140.2 141.7
======== ========
*Income from Elantec includes $25.4 million in revenue, $12.0 million in cost of
sales, $5.1 million in R&D, $4.9 million in SG&A and $0.9 million in interest
income
Adjustments to reconcile reported revenue to adjusted revenue:
Revenue $ 164.4 $ 134.1
Revenue for Elantec prior to acquisition - 25.4
Adjusted Revenue $ 164.4 $ 159.5
======== ========
This release may include "forward looking statements" that are subject to risks
and uncertainties. For information identifying economic, political, climatic,
currency, regulatory, technological, competitive and some other important
factors that could cause actual results to differ materially from those
anticipated in the forward looking statements, see Intersil's Safe Harbor
Forward Looking Statement disclaimer found at http://www.intersil.com/legal.asp,
as well as Intersil's SEC filings as updated from time to time, found at
http://www.sec.gov.
PRISM is a registered trademarks and Endura is a trademark of Intersil Americas
Inc Elantec is a registered trademark of Intersil Corporation or one of its
subsidiaries. Intel, Pentium and Centrino are trademarks or registered
trademarks of Intel Corporation. All other trademarks mentioned are the property
of their respective owners.