Exhibit 99.1
AMIS Holdings, Inc. Reports Fourth Quarter and 2003 Results
POCATELLO, Idaho--(BUSINESS WIRE)--Feb. 12, 2004--AMIS Holdings,
Inc. (Nasdaq:AMIS):
-- Record revenue in fourth quarter and 2003
-- 2003 annual revenue grew 32% from 2002
-- Gross margins for year increased 590 basis points over 2002
-- Non-GAAP fully diluted EPS for fourth quarter was $0.12,
exceeded consensus estimates of $0.11
AMIS Holdings, Inc. ("AMIS" or "Company") (Nasdaq:AMIS), parent
company of AMI Semiconductor, a leader in the design and manufacture
of integrated mixed-signal solutions, today reported record results
for the fourth quarter and year ended Dec. 31, 2003.
Financial Results
Fourth quarter 2003 revenue was $125.5 million, an increase of 7%
over the third quarter 2003 revenue and 22% above the fourth quarter
of last year. Operating income under generally accepted accounting
principles (GAAP) was $19.8 million for the fourth quarter of 2003, an
increase of 173% over third quarter operating income of $7.3 million
and 276% over fourth quarter 2002 operating income of $5.3 milion.
GAAP net income for the fourth quarter of 2003 was $3.4 million, an
increase of 103% over third quarter net income of $1.7 million and 13%
over the fourth quarter 2002 net income of $3.0 million. GAAP earnings
per share for the fourth quarter was $0.04 on a fully diluted basis.
For fiscal 2003, AMIS reported revenue of $454.2 million, an
increase of 32% over 2002 revenue of $345.3 million. Operating income
on a GAAP basis was $30.2 million compared to $17.6 million in 2002.
Net loss for 2003 was $0.4 million compared to net income of $5.1
million in 2002.
AMIS also reports operating income and net income, as well as
earnings per share, on a non-GAAP basis. AMIS believes the non-GAAP
information better reflects the ongoing operational performance of the
Company and therefore provides better comparability between periods.
Non-GAAP earnings exclude unusual items such as non-cash costs related
to impairment charges and the write-off of deferred financing charges
related to various debt redemptions, cash charges related to the early
redemption of $70 million of the Company's senior subordinated notes,
restructuring costs and related tax effects.
Non-GAAP operating income for the fourth quarter was $21.5 million
compared to $18.7 million in the third quarter and $5.7 million in the
fourth quarter of 2002. Net income on a non-GAAP basis was $10.5
million in the fourth quarter compared to $9.2 million in the third
quarter and $3.2 million in the fourth quarter of 2002. Fourth quarter
non-GAAP EPS was $0.12 on a fully diluted basis.
Non-GAAP operating income for 2003 increased to $63.3 million or
247% over 2002 non-GAAP operating income of $18.3 million. Non-GAAP
net income increased to $28.7 million for 2003, an increase of 422%
over the 2002 non-GAAP net income of $5.5 million.
During the fourth quarter, AMIS had sequential revenue growth
across all three product lines. Integrated mixed-signal products
increased 1%, mixed-signal foundry services was up 5% and structured
digital products grew 25% over third quarter 2003 revenue levels.
Gross margin in the fourth quarter was 45.3%, an increase of 140 basis
points over the third quarter gross margin.
Operating cash flow for the fourth quarter was $24.1 million and
capital expenditures were $6.5 million. Free cash flow during the
fourth quarter was $17.6 million, an increase of 338% over the third
quarter and 96% over the fourth quarter of 2002. Cash balances at Dec.
31, 2003 were $119.1 million, an increase of $56.9 million from the
Dec. 31, 2002 balance of $62.2 million.
"AMIS had a great fourth quarter and full year 2003," said
Christine King, president and CEO. "The successful integration of our
acquisition of the mixed-signal business of Alcatel Microelectronics,
combined with our sales and marketing efforts and the revitalized
economy resulted in record revenues for the fourth quarter and 2003.
During the past 12 months, we have improved our gross margin by 590
basis points through increased utilization of our fabrication
facilities and strength in our product mix. We also continued building
for the future by increasing our design wins for 2003 by 34% from
2002."
Business Outlook
"We expect our first quarter revenue to range from $124 million to
$127 million," said King. "Going into the first quarter, we had
approximately 78% of this revenue recorded in backlog. Our gross
margin should approximate 45%. Additionally, we anticipate operating
margins to be flat to slightly higher than fourth quarter. Net
interest expense should be approximately $4.6 million. The effective
tax rate for the quarter is expected to be 22% to 25%, the cash tax
rate to be approximately 17% and fully diluted earnings per share is
expected to be $0.14, based on a share count of 86.6 million shares.
Cap ex is planned to be approximately 6% to 7% of annual revenues and
is expected to be weighted toward the first part of the year.
Depreciation and amortization will be about $10 million in the first
quarter."
Organizational Announcement
Today AMIS is announcing that Brent Jensen, chief financial
officer, is leaving the Company to pursue other interests. Brent will
work as a consultant for AMIS, providing continuity while the search
for his replacement is ongoing.
On an interim basis, Mike Salvati will act as AMI Semiconductor's
CFO and will lead the Company's finance organization while the search
continues for a CFO to provide financial leadership through the next
phase of the Company's growth. Mike has been working with Brent and
AMIS as a consultant for several months. Mike has over 25 years of
financial and business experience, including experience as a partner
at KPMG LLP, Chief Financial Officer of Culligan Water Technologies,
Inc. and Global Exchange Services and Chief Operating Officer at
National Financial Partners, Inc. Mike has also worked as a consultant
to Francisco Partners, one of our significant stockholders.
"We are confident that with Mike's leadership and Brent's
assistance, AMIS will continue performing to its same high standards
during this transitional period," said King. "We are grateful to Brent
for more than a decade of service to the Company and for his
contribution to our recent successful initial public offering. He
leaves us more secure financially and can take pride in his
contributions while he pursues other interests. We wish Brent the best
and appreciate his willingness to continue to work with the Company as
a consultant while we search for his successor."
Conference Call
President and Chief Executive Officer Chris King along with Brent
Jensen and Mike Salvati will conduct a conference call on Feb. 12,
2004 at 5 p.m. ET, to discuss the Company's earnings and operations.
Investors and other interested parties may listen to a live audio
webcast of the conference call by visiting the investor relations
section of the AMIS Web site at http://www.amis.com. A webcast replay
is expected to be available on the Company's Web site until close of
business Feb. 26.
About AMI Semiconductor
AMI Semiconductor (AMIS) is a leader in the design and manufacture
of silicon solutions for the real world. As a widely recognized
innovator in state-of-the-art integrated mixed-signal products,
mixed-signal foundry services and structured digital products AMIS is
committed to providing customers with the optimal value, quickest
time-to-market semiconductor solutions. Offering unparalleled
manufacturing flexibility and dedication to customer service, AMI
Semiconductor operates globally with headquarters in Pocatello, Idaho,
European corporate offices in Oudenaarde, Belgium, and a network of
sales and design centers located in the key markets of the United
States, Europe and the Asia Pacific region. For more information,
please visit the AMIS Web site at www.amis.com.
Forward-Looking Statements
Statements in this press release other than statements of
historical fact are "forward-looking" statements within the meaning of
the Private Securities Litigation Reform Act of 1995. The Company's
future results could differ materially from the expectations discussed
herein. Factors that could cause or contribute to such differences
include general economic and political uncertainty, conditions in the
semiconductor industry, changes in the conditions affecting our target
markets, manufacturing underutilization, fluctuations in customer
demand, raw material costs, exchange rates, timing and success of new
products, competitive conditions in the semiconductor industry, and
risks associated with international operations. For a more
comprehensive discussion of risks and uncertainties relating to our
business, please read the discussions of these risks in the Company's
Form S-1 registration statement filed with the SEC. The Company
undertakes no obligation to revise or update any forward-looking
statements to reflect events or circumstances after the date of this
press release.
Non-GAAP Measures
To supplement our consolidated financial statements presented in
accordance with GAAP, we use the non-GAAP measures discussed below.
These measures should be considered in addition to results prepared in
accordance with generally accepted accounting principles, but should
not be considered a substitute for or superior to GAAP results and may
not be comparable with similarly titled measures reported by other
companies.
We define adjusted EBITDA as net income adjusted to exclude
certain expenses including depreciation, amortization, interest,
income taxes, non-recurring charges and other non-operating expenses.
Adjusted EBITDA is provided to enhance the user's overall
understanding of our current financial performance, our ability to
service our debt and our prospects for the future and ability to fund
future growth. Specifically, we believe adjusted EBITDA provides
useful information to management, investors and debt holders and is a
financial measure used by rating agencies to analyze and compare
companies on the basis of operating performance and liquidity.
Adjusted EBITDA has been reconciled to net income.
We have provided non-GAAP operating income, non-GAAP net income
and non-GAAP fully diluted earnings per share. Non-GAAP operating
income is operating income less the restructuring, impairment and
nonrecurring charges line on the income statement. Non-GAAP net income
is net income (loss) less the restructuring, impairment and
nonrecurring charges line, various write-offs of deferred financing
charges, the premium paid in association with the redemption of $70
million of the senior subordinated notes and the tax effects related
to these charges (assuming a 41% effective tax rate) on the income
statement. Non-GAAP fully diluted earnings per share is non-GAAP net
income divided by the fully diluted shares outstanding. We believe
that these excluded charges are nonrecurring and that the exclusion of
these charges enhances comparability between the current period and
past periods. Non-GAAP operating income has been reconciled to
operating income, non-GAAP net income has been reconciled to net
income (loss) and the calculation for non-GAAP fully diluted earnings
per share has been provided.
We have provided non-GAAP tax expense. This measure is tax expense
less a 41% tax effect for the restructuring, impairment and
nonrecurring charges line on the income statement, various write-offs
of deferred financing charges and the premium paid in association with
the redemption of $70 million of the senior subordinated notes. We
believe that these charges are nonrecurring and that the exclusion of
these charges enhances comparability between the current period and
past periods. Non-GAAP tax expense has been reconciled to tax expense.
We have provided free cash flow. This measure is operating cash
flow less capital expenditures. We believe that this measure is useful
as an indicator of our liquidity and is commonly used by debt holders.
Free cash flow has been reconciled to operating cash flow.
AMIS Holdings, Inc.
Condensed Consolidated Statements of Operations
(In millions - Unaudited)
Three Months Twelve Months
Ended Ended
--------------- ---------------
Dec 31, Dec 31, Dec 31, Dec 31,
2003 2002 2003 2002
------- ------- ------- -------
Revenue
Integrated mixed signal
products $62.2 $58.6 $241.4 $167.2
Mixed signal foundry services 32.3 25.0 116.1 93.1
Structured digital products 31.0 18.9 96.7 85.0
------- ------- ------- -------
Total revenue 125.5 102.5 454.2 345.3
Cost of revenue 68.6 65.4 256.0 214.9
------- ------- ------- -------
Gross profit 56.9 37.1 198.2 130.4
Operating expenses:
Research & development 17.9 15.1 70.3 52.1
Selling, general and
administrative 17.5 16.3 64.6 60.1
Restructuring, impairment and
nonrecurring charges 1.7 0.4 33.1 0.6
------- ------- ------- -------
37.1 31.8 168.0 112.8
------- ------- ------- -------
Operating income 19.8 5.3 30.2 17.6
Non-operating expenses, net 15.8 2.3 38.7 11.3
------- ------- ------- -------
Income (loss) before income
taxes 4.0 3.0 (8.5) 6.3
Provision (benefit) for income
taxes 0.6 0.0 (8.1) 1.2
------- ------- ------- -------
Net income (loss) $3.4 $3.0 $(0.4) $5.1
======= ======= ======= =======
Earnings per share
Basic $0.04 NA NA NA
Diluted $0.04 NA NA NA
Weighted average shares
Basic 79.1 NA NA NA
Diluted 86.4 NA NA NA
Note: Results from 2003 are not comparable to 2002 principally as a
result of the June 2002 acquisition of the Mixed Signal Business
of Alcatel Microelectronics.
Key Ratios & Information:
- -------------------------------
Gross margin 45.3% 36.2% 43.6% 37.8%
Operating margin 15.8% 5.2% 6.6% 5.1%
Adjusted EBITDA margin 25.3% 19.0% 23.8% 18.9%
Adjusted EBITDA $31.7 $19.5 $108.2 $65.2
Depreciation & amortization
expense $10.2 $13.8 $44.9 $47.0
Capital expenditures $6.5 $5.2 $26.5 $22.0
Operating cash flow $24.1 $14.2 $70.7 $81.1
Free cash flow $17.6 $9.0 $44.2 $59.1 Three
Months
Ended
Reconciliation of GAAP to Non- Sep 28,
GAAP Information: 2003
- ------------------------------- -------
GAAP operating income $19.8 $5.3 $30.2 $17.6 $7.3
Restructuring, impairment and
nonrecurring charges 1.7 0.4 33.1 0.6 11.4
------- ------- ------- ------- -------
Non-GAAP operating income 21.5 5.7 63.3 18.2 18.7
GAAP net income (loss) $3.4 $3.0 $(0.4) $5.1 $1.7
Restructuring, impairment and
nonrecurring charges 1.7 0.4 33.1 0.6 11.4
Other income (expense) 10.3 -- 16.2 -- 1.4
Associated tax effects (4.9) (0.2) (20.2) (0.2) (5.3)
------- ------- ------- ------- -------
Non-GAAP net income $10.5 $3.2 $28.7 $5.5 $9.2
======= ======= ======= ======= =======
Non-GAAP earnings per share
Basic $0.13 NA NA NA NA
Diluted $0.12 NA NA NA NA
Weighted average shares
Basic 79.1 NA NA NA NA
Diluted 86.4 NA NA NA NA
Reconciliation of Tax Expense
to Non-GAAP Tax Expense:
- -------------------------------
Tax expense $0.6 $0.0 ($8.1) $1.2 ($2.0)
Associated tax effects
excluded from Non-GAAP net
income (4.9) (0.2) (20.2) (0.2) (5.3)
------- ------- ------- ------- -------
Non-GAAP tax expense $5.5 $0.2 $12.1 $1.4 $3.3
======= ======= ======= ======= =======
Reconciliation of Net Income
(Loss) to Adjusted EBITDA:
- -------------------------------
Net income (loss) $3.4 $3.0 ($0.4) $5.1 $1.7
Non-operating expenses, net 15.8 2.3 38.7 11.3 7.6
Provision (benefit) for income
taxes 0.6 0.0 (8.1) 1.2 (2.0)
Depreciation and amortization
expense 10.2 13.8 44.9 47.0 9.6
Restructuring, impairment and
nonrecurring charges 1.7 0.4 33.1 0.6 11.4
------- ------- ------- ------- -------
Adjusted EBITDA $31.7 $19.5 $108.2 $65.2 $28.3
======= ======= ======= ======= =======
Reconciliation of Operating
Cash Flow to Free Cash Flow:
- -------------------------------
Operating cash flow $24.1 $14.2 $70.7 $81.1 $2.7
Capital expenditures 6.5 5.2 26.5 22.0 10.1
------- ------- ------- ------- -------
Free cash flow $17.6 $9.0 $44.2 $59.1 ($7.4)
======= ======= ======= ======= =======
AMIS Holdings, Inc.
Condensed Consolidated Balance Sheets
(In Millions)
Dec 31, Dec 31,
2003 2002
(unaudited)
----------- ----------
Assets
- --------------------------
Current assets:
Cash and cash equivalents $119.1 $62.2
Accounts receivable, net 73.6 66.0
Inventories 45.6 39.4
Other current assets 29.7 32.0
----------- ----------
Total current assets 268.0 199.6
Property, plant and equipment, net 205.9 222.5
Other non-current assets, including intangibles 76.2 80.4
----------- ----------
Total assets $550.1 $502.5
=========== ==========
Liabilities and Stockholders' Equity (Deficit)
Current liabilities:
Accounts payable and other accrued expenses $90.0 $76.2
Current portion of long-term debt 1.3 8.7
----------- ----------
Total current liabilities 91.3 84.9
Long-term debt, less current portion 253.4 151.4
Other long-term liabilities 0.4 3.1
Redeemable preferred stock 0.0 503.5
Stockholder's equity (deficit) 205.0 (240.4)
----------- ----------
Total liabilities and stockholders' equity
(deficit) $550.1 $502.5
=========== ==========
CONTACT: AMI Semiconductor, Pocatello
Investor Relations:
Jimmie Hutchens, 208-234-6732
jimmie_hutchens@amis.com
or
Media Relations:
Tamera Drake, 208-234-6890
tamera_drake@amis.com