Exhibit 99.1
Semtech First Quarter Sales up 12 Percent Sequentially; Sales up 41
Percent and Net Income up 79 Percent over Prior Year Period
CAMARILLO, Calif.--(BUSINESS WIRE)--May 25, 2004--
Outlook for 7 to 10 Percent Sequential Sales Growth
Semtech Corporation (Nasdaq:SMTC), a leading producer of high
performance analog and mixed-signal semiconductors, today announced
that net sales and income for its first quarter of fiscal year 2005
increased significantly over the fourth quarter and prior year period.
Gross margin for the first quarter of fiscal year 2005 was a record
59.4 percent.
Net sales for the first quarter that ended April 25, 2004 were
$61.9 million, up from $44.0 million in the prior year first quarter.
Net income for the first quarter of fiscal year 2005 was $14.8 million
or 19 cents per diluted share, up from $8.3 million or 11 cents per
diluted share in the prior year period. Net income in the first
quarter of fiscal year 2005 represented a 24 percent after-tax margin.
The growth in net sales, operating income and earnings per share for
the quarter exceeded the Company's previous forecast.
Sales for all five of Semtech's strategic product lines increased
in the first quarter of fiscal year 2005 compared to the fourth
quarter and prior year period. New orders in the first quarter grew
faster than net sales and represented the second highest bookings
quarter in the Company's history. Demand remained strong across the
major end-markets of computing, communications and industrial. Based
on beginning backlog and confirmed design wins, the Company expects
sales growth across all major end-markets and product lines in the
second quarter of fiscal year 2005.
Power Management products represented 53 percent of sales in the
first quarter. Demand was strong for power products used in cellular
phones, desktop computers, graphics and in the emerging areas of
networking and industrial. Orders for Protection products, which are
used in a diverse range of portable, broadband and networking systems,
were up 64 percent over the same period last year. Shipments of
Protection products were up 51 percent over last year.
Jason Carlson, Semtech's President and Chief Executive Officer
commented, "Semtech's business remains strong across all major markets
and product lines. Our leadership in Portable Power Management and
Protection products is driving sales in many different portable
applications. New product development, including out of the Human
Input Device (HID) product line, has increased Semtech's available
content in key applications like feature-rich cellular phones,
notebook computers and portable devices. The HID product line doubled
its orders in the first quarter over the fourth quarter due to several
programs at major OEMs."
Mr. Carlson added, "Strength outside of portable applications is
apparent in the greater than 25 percent sequential growth in the
end-markets of communications infrastructure, industrial and military.
Networking and industrial have been focus areas for sales efforts in
the last two years."
Design wins secured in the first three months of fiscal year 2005
have the potential for more than $80 million of annual revenue.
Telecom and networking applications represented 17 percent of total
design win dollars, the second largest end-market segment for design
wins after portable electronics.
Semtech ended the first quarter of fiscal year 2005 with $278.9
million of cash and investments and no long-term debt. The Company
spent $3.1 million on the repurchase of common stock in the first
three months of the fiscal year.
Second Quarter Outlook
Semtech estimates that net sales for the second quarter of fiscal
year 2005 will be up 7 to 10 percent over the first quarter. Turns
orders (orders received and shipped in the same quarter) of
approximately 30 percent are required to achieve this forecast. Gross
margin and operating income are expected to increase. Earnings in the
second quarter are forecasted to be 21 cents per diluted share.
About Semtech
Semtech Corporation is a leading supplier of analog and
mixed-signal semiconductors used in a wide range of computer,
industrial and communication applications.
Safe Harbor Provision
Statements contained in this release that are not historical facts
are forward-looking statements as that term is defined in the Private
Securities Litigation Reform Act of 1995. Forward-looking statements,
including projections and forecasts for revenue and gross margin,
involve risks and uncertainties that could cause actual results to
differ materially from those projected. These risks and uncertainties
include worldwide economic and political conditions, the timing and
duration of semiconductor market upturns or downturns, demand for
cellular phones, personal computers and automated test equipment,
demand for semiconductor devices in general, demand for the Company's
products in particular, competitors' actions, supply from key
third-party silicon wafer foundries and assembly contractors,
manufacturing costs and yields, relations with strategic customers,
and risks associated with the businesses of major customers. Other
factors that may cause actual results to differ from the
forward-looking statements contained in this press release and that
may affect the Company's prospects in general are described in the
Company's filings with the Securities and Exchange Commission. The
Company undertakes no obligation to update or revise forward-looking
statements to reflect subsequent events or changed assumptions or
circumstances.
SEMTECH CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In thousands - except per share amounts)
Three Months Ended
April 25, April 27,
2004 2003
(Unaudited) (Unaudited)
Net sales $61,893 $44,017
Cost of sales 25,111 19,160
Gross profit 36,782 24,857
Operating costs and expenses:
Selling, general and administrative 10,341 8,946
Product development and engineering 7,907 7,825
Total operating costs and expenses 18,248 16,771
Operating income 18,534 8,086
Interest and other income, net 894 2,792
Income before taxes 19,428 10,878
Provision for taxes 4,663 2,611
Net income $14,765 $8,267
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Earnings per share:
Basic $0.20 $0.11
Diluted $0.19 $0.11
Weighted average number of shares:
Basic 74,226 73,236
Diluted 78,819 76,522
Notes regarding Consolidated Statements of Income:
1.) In the three month period ended April 25, 2004, $297,000 of
previously written-off inventory was sold. In the three month period
ended April 27, 2003, $484,000 of previously written-off inventory was
sold.
2.) "Interest and other income, net" includes a gain on the
repurchase of convertible subordinated notes of $2.8 million in the
three month period ended April 27, 2003.
SEMTECH CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)
April 25, January 25,
2004 2004
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $66,115 $96,314
Temporary investments 90,378 93,044
Receivables, less allowances 22,339 20,362
Inventories 23,880 22,166
Income taxes refundable 5,795 5,795
Deferred income taxes 4,650 5,212
Other current assets 8,431 3,062
Total current assets 221,588 245,955
Property, plant and equipment, net 51,819 49,579
Investments, maturities in excess of 1 year 122,412 86,119
Deferred income taxes 25,199 25,552
Other assets 1,884 1,268
Total Assets $422,902 $408,473
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Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $13,822 $8,554
Accrued liabilities 7,808 16,894
Income taxes payable 2,117 1,699
Deferred revenue 3,097 1,689
Other current liabilities - 27
Total current liabilities 26,844 28,863
Other long-term liabilities 615 -
Total Stockholders' equity 395,443 379,610
Total Liabilities and Stockholders' Equity $422,902 $408,473
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CONTACT: Semtech Corporation
John Baumann, 805-480-2010 (Investor Relations)