Exhibit 99.1
Catalyst Semiconductor Reports 4th Quarter, Year-End Results;
Annual Revenue Up 31% With 6th Consecutive Year of Profitability
SUNNYVALE, Calif.--(BUSINESS WIRE)--May 27, 2004--Catalyst
Semiconductor, Inc. (NASDAQ:CATS), a developer and marketer of
programmable products used in telecommunications, networking systems,
computation, automotive, industrial and consumer markets, today
reported financial results for its fiscal fourth quarter ended April
30, 2004.
For the fiscal fourth quarter ended April 30, 2004, Catalyst had
net income of $5.6 million, or $0.29 per diluted share -- including a
tax benefit of $2.2 million, or $0.14 per share -- on revenues of
$16.8 million. This compares with net income of $4.0 million, or $0.22
per diluted share -- including a tax benefit of $2.7 million, or $0.16
per share -- on revenues of $12.5 million in the year-ago quarter
ended April 30, 2003. In the preceding quarter ended January 31, 2004,
the Company reported net income of $2.4 million, or $0.12 per diluted
share, on revenues of $16.9 million.
During the fourth quarter, the deferred gross margin on shipments
increased $1.5 million as inventories increased sharply at
distributors.
As of April 30, 2004, Catalyst had cash, cash equivalents and
short-term investments of $33.8 million, a decrease of $1.1 million
compared to the previous quarter as $4.1 million of cash was used to
repurchase common stock.
Gross margin for the quarter ended April 30, 2004 was 49.0%,
compared to 46.0% for the previous quarter and 42.3% one year ago.
Fourth quarter sales reflected a better mix of new products and
stronger overall ASPs compared to the third quarter, and included
increased sales of reserved inventory and decreased royalty expense
related to the settlement of a dispute with Philips announced in the
third quarter.
The company reversed its valuation allowance against its deferred
tax assets during the fourth quarter of fiscal 2004. This resulted in
a fourth quarter income tax benefit of $2.2 million and a $5.1 million
increase in shareholders equity for the benefit related to employee
stock options.
Research and development expense increased 3% from the previous
quarter, while overall operating expense were flat compared to the
previous quarter. Other highlights of the quarter included:
-- Fourth-quarter shipments from analog/mixed signal products
grew to $705,000 or 4.2% of total revenues, compared with
$432,000 or 2.6% of revenues in the prior quarter;
-- Shipping more than 1 million microprocessor supervisors per
quarter, up from nearly zero two quarters ago;
-- Ramping up production in a new, more advanced process, for
EEPROM memory products
-- Repurchasing of 600,000 shares of Company common stock from
Elex, N.V. at $6.77 per share.
Management Comments & Outlook
"Here we are at the end of a very rewarding fiscal year; we
managed to grow our revenue from $48.2 million in FY 2003 to more than
$63.5 million in fiscal 2004, and added the sixth consecutive
profitable year to our growing list of achievements. For the last
three quarters, we shipped at a rate of more than 100 million units
per quarter and we are prepared to increase this number if market
conditions require. We are excited by the progress being made in both
growing the revenue from our analog/mixed signal products and in our
increasing involvement with customers on the design of customized,
next-generation versions of such products. This revenue growth helps
us increase profit margins and grow overall revenues, and also
strengthens our position as supplier of a wide base of products to our
customers," said Gelu Voicu, president and chief executive officer.
12-Month Results
For the 12 months ended April 30, 2004, Catalyst had net income of
$9.4 million, or $0.48 per diluted share on revenues of $63.5 million.
This compares with net income of $6.3 million, or $0.34 per share, on
revenues of $48.2 million for fiscal year 2003. Gross margin for
fiscal year 2004 was 41.2% compared to 41.1% for fiscal year 2003.
Gross margin for fiscal 2004 reflects higher sales volume at lower
ASPs. In 2004, the Company recognized $1.4 million of royalty expense
related to the settlement with Philips and a $1.1 million benefit,
compared to $495,000 in 2003, related to the sales of previously
reserved inventory.
Investor Conference Call
The Company will conduct a conference call on the fourth fiscal
quarter results beginning at 2:00 p.m. (Pacific Time) today. The call
will be available to all investors and media via the company's Web
site www.catalyst-semiconductor.com, at www.companyboardroom.com, or
by dialing (800) 865-4425 (domestic only). A replay of the call will
be aired from approximately 4:00 p.m. today until midnight (Pacific)
on June 4, 2004 at the company's Web site or by dialing (877) 519-4471
(domestic) or (973) 341-3080 (international), entering reservation
number 4774022 and following operator instructions.
About Catalyst Semiconductor
Founded in 1985, Catalyst Semiconductor, Inc. is headquartered in
Sunnyvale, California. The Company designs and markets a broad range
of programmable products including Serial and Parallel EEPROMs with
I2C, SPI and Microwire interfaces, Flash Memories, NVRAM, Digitally
Programmable Potentiometers, Microcontroller Supervisory circuits and
other programmable Analog/Mixed Signal products. Catalyst products are
used in telecommunications, networking systems, computation,
automotive, industrial and consumer markets. Typical applications
include optical networks, modems, wireless LANs, network cards, PC
BIOS, DIMM modules, cellular telephones, digital satellite box
receivers, set-top boxes and Internet routers. Catalyst's Quality
Management System is ISO 9001 certified. For additional information
about Catalyst Semiconductor, visit our web site at
www.catalyst-semiconductor.com
Certain statements in this press release, including statements
regarding increasing future revenues and profit margins, introducing
new products, increasing revenues, shipments and market share, and
adding new customers, and reducing manufacturing costs, are forward
looking statements that are subject to risks and uncertainties. These
risks and uncertainties, which could cause the forward looking
statements and Catalyst's results to differ materially, include,
without limitation: increased competition in the markets for
Catalyst's products leading to decreased average selling prices; the
continued growth of the markets for Catalyst's products; market
acceptance and demand for Catalyst's new products; potential errors,
latent defects, design flaws or other problems with any of Catalyst's
products; volatility in supply and demand for Catalyst's products
which would adversely affect revenues and market prices; price and
availability of foundry services, assembly and test subcontract
capacity which are required to meet Catalyst's financial targets
and/or meet backlog requirements; timing, future development, cost and
market acceptance of our new products and the other risks detailed
from time to time in Catalyst's Securities and Exchange Commission
filings and reports, including, but not limited to, Catalyst's annual
report filed on form 10-K and quarterly reports filed on form 10-Q.
Catalyst disclaims any obligation to update information contained in
any forward looking statement.
CATALYST SEMICONDUCTOR, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
April April
30, 30,
2004 2003
-------- --------
ASSETS
Current assets:
Cash and cash equivalents $17,245 $7,828
Short-term investments 16,564 20,078
Accounts receivable, net 12,547 7,863
Inventories 6,960 8,423
Deferred tax assets 5,024 1,914
Other assets 875 1,146
-------- --------
Total current assets 59,215 47,252
Property and equipment, net 3,334 3,091
Deferred tax assets 4,098 0
Other assets 218 245
-------- --------
Total assets $66,865 $50,588
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $5,016 $3,692
Accrued expenses 3,782 3,126
Deferred gross profit on shipments to distributors 4,079 1,417
-------- --------
Total current liabilities 12,877 8,235
Total stockholders' equity 53,988 42,353
-------- --------
Total liabilities and stockholders' equity $66,865 $50,588
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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Twelve Months
Ended Ended
----------------- -----------------
April April April April
30, 30, 30, 30,
2004 2003 2004 2003
----------------- -----------------
Net revenue $16,838 $12,510 $63,538 $48,221
Cost of revenues 8,580 7,214 37,375 28,396
-------- -------- -------- --------
Gross profit 8,258 5,296 26,163 19,825
Research and development 1,996 1,470 7,130 5,223
Selling, general and administration 2,938 2,687 11,453 10,020
-------- -------- -------- --------
Operating income 3,324 1,139 7,580 4,582
Net interest income 97 145 379 382
-------- -------- -------- --------
Income before taxes 3,421 1,284 7,959 4,964
Income tax benefit 2,179 2,717 1,408 1,354
-------- -------- -------- --------
Net income $5,600 $4,001 $9,367 $6,318
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Net income per share:
Basic $0.33 $0.24 $0.57 $0.38
======== ======== ======== ========
Diluted $0.29 $0.22 $0.48 $0.34
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Weighted average common shares
Basic 16,806 16,721 16,567 16,721
======== ======== ======== ========
Diluted 19,593 18,339 19,411 18,339
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CONTACT: Catalyst Semiconductor, Inc.
Joan Vargas, 408-542-1051
joan.vargas@catsemi.com