Exhibit 99.1
Cirrus Logic Reports Fiscal Q4 and FY 2003 Results
AUSTIN, Texas--(BUSINESS WIRE)--April 30, 2003--Cirrus Logic, Inc.
(Nasdaq: CRUS) today announced financial results for its fiscal fourth
quarter and fiscal year 2003, ended March 29, 2003. Fiscal fourth
quarter results were in line with the company's Jan. 22, 2003
guidance. All financial information contained in this release was
prepared in accordance with generally accepted accounting principles
(GAAP).
The company reported fourth quarter revenue of $52.1 million, down
14 percent from the $60.5 million reported in the third quarter.
Fourth quarter gross margin was 51 percent, unchanged from the third
quarter. Fourth quarter combined research and development and selling,
general and administrative expenses were $34.8 million, a 13 percent
reduction over the prior quarter on a comparable basis. In the fourth
quarter, the company took a non-cash charge of $136.2 million related
to the write-off of goodwill in accordance with SFAS 142 and to the
impairment of intangible assets associated primarily with the
previously announced closing of our wireless product line. Including
this non-cash charge, the fourth quarter net loss was $152.8 million,
compared with $12.2 million in the third quarter; net loss per share
was $1.82, compared with a net loss per share of $0.15 in the prior
quarter. Total cash at the end of the fourth quarter was $123 million,
compared with $125 million at the end of the third quarter.
"I am encouraged by the progress we made with recent new product
introductions. While our sales performance met our fourth quarter
guidance, our results were constrained by lower demand for some of our
older mixed-signal products and the effects of the uncertain
macroeconomic and geopolitical environment," said David D. French,
president and CEO, Cirrus Logic, Inc.
Fiscal year 2003 revenue was $262.0 million, compared with $411.0
million in fiscal year 2002. Fiscal year 2002 revenue included $129.4
million from magnetic storage products, a product line that Cirrus
exited in July 2001. Gross margin in fiscal year 2003 was 50 percent,
up from 24 percent in the prior year. The net loss decreased in fiscal
year 2003 to $199.2 million from a net loss of $206.1 million in
fiscal year 2002. Net loss per share was $2.39, compared with a net
loss per share of $2.66 in the prior fiscal year.
"In fiscal 2003, we maintained our leadership position for audio
applications, our largest product category. While we made important
technology strides in advancing our video product line in fiscal 2003,
we were not able to capitalize on the expanding market for DVD players
due to challenges in meeting the rigorous software quality
requirements in this new market. We have made significant progress in
this area and are working with customers on DVD player applications
using our decoder products. In addition, the market for video
recording products, PVR and DVD recorders, did not materialize as
quickly as we had anticipated earlier in the year. We believe that we
are well positioned for the emerging DVD recording market with our
high-performance CS98200 DVD decoder family and CS92288 encoder
product," said French.
Recent Highlights
-- Strengthened Cirrus' multi-channel audio mixed-signal
leadership with the introduction of six new products,
including
-- two 24-bit highly integrated stereo codecs for a wide
variety of high-end audio applications;
-- the industry's highest-performing digital-to-analog
converter, which supports super audio CD (SACD) and
DVD-audio content;
-- our flagship analog-to-digital converter, designed for
cutting-edge audio applications; and
-- two 24-bit audio analog-to-digital converters targeted at
mainstream consumer products
-- Enhanced Cirrus' high-performance commercial audio leadership
with the announcement of
-- our first semiconductor product, a digital audio network
processor, based on CobraNet(TM) technology; and
-- two new CobraNet licensing agreements, one with Innovative
Electronic Designs, a leading manufacturer of commercial
audio systems for airports and convention centers, and
another with Harman Pro Group, which now extends the audio
technology to the entire range of Harman's audio products
-- Furthered our video position by
-- shipping our first video semiconductor components for
DVD+RW products in the fourth quarter, thereby expanding
the list of video recording end-products we support from
DVD Recorder products to Personal Video Recorders to PC
USB add-on accessories; and
-- announcing a licensing agreement with DivX Networks to
incorporate its popular MPEG-4 video technology into
Cirrus' new DVD processors.
Outlook and Guidance
"We believe that customers and distributors will continue to be
cautious and closely manage their build plans, maintain short order
lead times and very lean inventory levels," said French. "In the June
quarter, we expect results to be further impacted by the previously
announced expiration of our obligations to supply certain game console
components. As customers move into production with our new audio and
video components, especially our designs for the high-growth video
recording market, we expect to see revenue growth return in the second
half of calendar 2003."
First Quarter FY04 (ending June 28, 2003)
-- Revenue is expected to be $40 million - $45 million
-- Gross margins are expected to be 48 percent - 50 percent
-- Combined R&D and SG&A expenses are expected to total $34
million - $36 million
Conference Call
Cirrus Logic management will hold a conference call to discuss
these results today, April 30, at 4 p.m. Central Time. Those wishing
to join should dial (617) 847-3007 (pass code: Cirrus Logic) at
approximately 3:50 p.m. Central Time. A replay of the call will be
available starting one hour after the completion of the call until May
7, 2003. To access the replay, dial (617) 801-6888 (pass code:
593269). A live web cast of the conference call will also be available
via the company's website at www.cirrus.com.
Upcoming Investor Conferences
Cirrus Logic management will be presenting at the JP Morgan
Technology and Telecom Conference in San Francisco on May 7 at 11 a.m.
Central Time, and in New York at the U.S. Bancorp Piper Jaffray
Technology Conference on May 14 at 8:40 a.m. Central Time. Those
wishing to listen to management's presentations can hear a live and/or
an archived webcast via the company's website at www.cirrus.com.
About Cirrus Logic
Cirrus Logic is a premier supplier of high-performance analog,
mixed-signal, and digital processing solutions for consumer
entertainment electronics, automotive entertainment, and industrial
product applications. Building on its global market leadership in
audio ICs and its rich mixed-signal patent portfolio, Cirrus Logic
targets audio, video, and precision mixed-signal applications in these
growing markets. The company operates from headquarters in Austin,
Texas with offices in California, Colorado, Europe, Japan and Asia.
More information about Cirrus Logic is available at www.cirrus.com.
Except for historical information contained herein, the matters
set forth in this news release, including our estimates of first
fiscal quarter revenues, research and development and selling, general
and administrative expense levels, and gross margin levels, and
expectations regarding our revenue growth opportunities, are
forward-looking statements that are subject to certain risks and
uncertainties including such factors, among others, as overall
conditions in the semiconductor market; the expansion of the consumer
digital entertainment electronics market; the ability of the company
to successfully realize the benefits of its acquisitions; the possible
adverse impact of severe acute respiratory syndrome (SARS) on our
business; the ability of the company to introduce new products on a
timely basis and to deliver products that perform as anticipated;
risks associated with international sales and international
operations; the level of orders and shipments during the first fiscal
quarter of 2004, as well as customer cancellations of orders, or the
failure to place orders consistent with forecasts; pricing pressures;
hardware or software deficiencies; a shortage of manufacturing
capacity; the ability of the company to make continued substantial
investments in research and development; the retention of key
employees; the impact of restructuring charges, such as work force
reductions and facility consolidations; asset impairment charges; and
the risk factors listed in the company's Form 10-K for the year ended
March 30, 2002, and in other filings with the Securities and Exchange
Commission. The foregoing information concerning Cirrus Logic's
business outlook represents our outlook as of the date of this news
release, and Cirrus Logic undertakes no obligation to update or revise
any forward-looking statements, whether as a result of new
developments or otherwise, except as required by law.
Cirrus Logic is a trademark of Cirrus Logic Inc.
Summary financial data follows:
CIRRUS LOGIC, INC.
CONSOLIDATED CONDENSED BALANCE SHEET
(in thousands)
Mar. 29, Dec. 28, Mar. 30,
2003 2002 2002
--------- ----------- ---------
ASSETS (unaudited)
Current assets
Cash and cash equivalents $110,964 $111,959 $140,529
Restricted cash 11,844 12,844 12,807
Marketable equity securities 543 904 2,258
Accounts receivable, net 22,712 27,886 42,158
Inventories, net 22,339 28,523 27,985
Other current assets 8,293 18,564 18,196
--------- ----------- ---------
Total Current Assets 176,695 200,680 243,933
Property and equipment, net 35,321 38,393 36,549
Goodwill and intangibles, net 38,797 178,772 194,660
Other assets 6,453 6,412 6,488
--------- ----------- ---------
Total Assets $257,266 $424,257 $481,630
========= =========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued
liabilities $43,089 $56,828 $73,711
Current maturities of long-term debt
and capital lease obligations - - 566
Income taxes payable 37,820 37,527 42,178
--------- ----------- ---------
Total Current Liabilities 80,909 94,355 116,455
Long-term obligations 12,830 13,414 5,934
Minority interest in eMicro - 599 1,092
Stockholders' equity:
Capital stock 867,976 867,519 862,729
Accumulated deficit (703,912) (551,110) (504,699)
Accumulated other comprehensive
income (loss) (537) (520) 119
--------- ----------- ---------
Total Stockholders' Equity 163,527 315,889 358,149
--------- ----------- ---------
Total Liabilities and
Stockholders' Equity $257,266 $424,257 $481,630
========= =========== =========
CIRRUS LOGIC, INC.
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(unaudited)
(in thousands, except per share data)
Quarter Ended
-------------------------------
Mar. 29, Dec. 28, Mar. 30,
2003 2002 2002
---------- --------- ---------
Net sales $52,145 $60,516 $82,769
Costs and expenses:
Cost of sales 25,778 29,361 42,414
Research and development 19,467 21,886 28,103
Selling, general and administrative 15,342 17,909 23,997
Restructuring costs 1,238 2,208 3,544
Acquired in-process research and
development expenses and
amortization of acquired
intangibles 4,034 4,456 4,835
Impairment of goodwill and other
intangibles 136,160 - -
Lease termination costs 4,568 - -
Provision for doubtful accounts - - 73,074
---------- --------- ---------
Total costs and expenses 206,587 75,820 175,967
---------- --------- ---------
Income (loss) from operations (154,442) (15,304) (93,198)
Realized gain (loss) on marketable
equity securities (238) - -
Interest income and (expense), net 644 542 2,950
Other income (expense), net 1,793 (1,886) (284)
---------- --------- ---------
Income (loss) before income taxes and
loss from discontinued operations (152,243) (16,648) (90,532)
Provision (benefit) for income taxes 559 (4,435) (10,370)
---------- --------- ---------
Income (loss) from continuing
operations (152,802) (12,213) (80,162)
Loss from discontinued operations - - (633)
---------- --------- ---------
Net income (loss) $(152,802) $(12,213) $(80,795)
========== ========= =========
Basic and diluted earnings (loss) per
share:
From continuing operations $(1.82) $(0.15) $(0.97)
Discontinued operations - - (0.01)
---------- --------- ---------
$(1.82) $(0.15) $(0.98)
========== ========= =========
Basic and diluted weighted average
common shares outstanding 83,754 83,487 82,748
CIRRUS LOGIC, INC.
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(in thousands, except per share data)
Twelve Months Ended
---------------------
Mar. 29, Mar. 30,
2003 2002
---------- ----------
Net sales $261,999 $410,976
Costs and expenses:
Cost of sales 129,757 314,227
Research and development 95,271 108,072
Selling, general and administrative 73,661 94,778
Restructuring costs 8,633 10,923
Acquired in-process research and development
expenses and amortization of acquired
intangibles 17,837 42,492
Impairment of goodwill and other intangibles 136,160 -
Lease termination costs 4,568 -
Provision for doubtful accounts - 73,074
---------- ----------
Total costs and expenses 465,887 643,566
---------- ----------
Income (loss) from operations (203,888) (232,590)
Realized gain (loss) on marketable equity
securities 215 10,967
Interest income and (expense), net 2,467 8,091
Other income (expense), net (373) (919)
---------- ----------
Income (loss) before income taxes and loss from
discontinued operations (201,579) (214,451)
Provision (benefit) for income taxes (3,818) (10,370)
---------- ----------
Income (loss) from continuing operations (197,761) (204,081)
Loss from discontinued operations (1,452) (1,998)
---------- ----------
Net income (loss) $(199,213) $(206,079)
========== ==========
Basic and diluted earnings (loss) per share:
From continuing operations $(2.37) $(2.63)
Discontinued operations (0.02) (0.03)
---------- ----------
$(2.39) $(2.66)
========== ==========
Basic and diluted weighted average common shares
outstanding 83,445 77,552
CONTACT: Cirrus Logic, Inc.
David Allen, 512/851-4000
InvestorRelations@cirrus.com