SUNNYVALE, Calif., April 30, 2009 (GLOBE NEWSWIRE) -- Applied Micro Circuits Corporation (Nasdaq:AMCC) today reported its financial results for the fourth quarter of fiscal 2009 ending March 31st, 2009.
* Q4 net revenues from continuing operations were $41.0 million,
down 30% year over year and 14% sequentially. Q4 revenues from
the discontinued storage business were $4.5 million and down 65%
year over year and 54% sequentially.
* Q4 and fiscal 2009 GAAP net loss was $(27.4) million and
$(309.3) million or $(0.42) and $(4.74) per share, respectively.
Q4 and fiscal 2009 loss from discontinued operations were $(4.6)
million and $(48.2) million or $(0.07) and $(0.74) per share,
respectively.
* Q4 2009 non-GAAP net loss was $(11.8) million or $(0.18) per
share and fiscal 2009 non-GAAP net income of $10.2 million or
$0.16 per share.
* Total cash was approximately $184 million as of March 31, 2009
(before the cash from the sale of the storage business).
* On April 21, 2009 AMCC completed the sale of its 3ware storage
adapter solutions business for $20 million in cash.
* In Q4 2009, AMCC announced a reduction in force impacting
slightly over 100 people that will result in anticipated annual
savings of $14 to $16 million (this does not include the
divestiture of the storage business).
* AMCC announced the introduction of the Yahara family of 10GbE
Framer/Mapper/PHY devices for multi-service transport platforms
and Metro/Long Haul Optical networks.
Net revenues from continuing operations for the fourth quarter of fiscal 2009 were $41.0 million compared to $47.7 million in the third quarter of fiscal 2009, representing a sequential decline of 14% and a decline of 30% over the $58.6 million in net revenues reported in the fourth quarter of fiscal 2008. Revenues from continuing operations for the fiscal year ended March 31, 2009 were $214.2 million compared to $194.1 million for last year, a 10% increase.
The net loss on a generally accepted accounting principles (GAAP) basis for the fourth quarter of fiscal 2009 was $(27.4) million or $(0.42) per share. The fourth quarter GAAP net loss compares with a net loss of $(274.5) million or $(4.20) per share for the third quarter of fiscal 2009 and a net loss of $(86.3) million or $(1.33) per share for the fourth quarter of fiscal 2008. The GAAP net loss for fiscal 2009 was $(309.3) million or $(4.74) per share compared to $(115.1) million or $(1.70) per share for fiscal 2008. The losses for fiscal 2009 and 2008 included $264.1 million and $71.5 million, respectively, relating to the impairment write-down of goodwill.
Non-GAAP loss from continuing operations for the fourth quarter of fiscal 2009 was $(8.4) million or $(0.13) per share, compared to non-GAAP income from continuing operations of $3.3 million or $0.05 per share in the third quarter of fiscal 2009 and non-GAAP net income from continuing operations of $5.3 million or $0.08 per share for the fourth quarter of fiscal 2008. The non-GAAP net income from continuing operations for fiscal 2009 was $11.6 million or $0.18 per share compared to a non-GAAP loss from continuing operations of $(7.1) million or $(0.10) per share for fiscal 2008.
"The lower revenues were in line with our expectations given the overall depressed market conditions. The sale of our 3ware storage adapter business enables us to focus on our core strengths in the development of integrated circuits for energy-optimized packet-based networks. Given our solid product cycles and design-win pipeline combined with our strategic refocus, I am confident we will emerge from this downturn as a much stronger company," said Kambiz Hooshmand, president and chief executive officer.
Bob Gargus, chief financial officer, commented, "The fourth quarter was difficult, but with the divestiture and certain cost control measures that we have put in place, we are confident that it will enable us to optimally focus our resources on our core business sectors and give us a solid base to scale as revenues ramp back."
AMCC reports its financial results in accordance with GAAP and also provides additional financial data that have not been prepared in accordance with GAAP. The non-GAAP results and other financial measures reported by the Company exclude certain items that are required by GAAP, such as restructuring charges, amortization of purchased intangibles, stock-based compensation charges, impairment of goodwill, strategic investment written off and gain on renegotiated design tool agreement, other than temporary impairment on investments, tax provision related to the creation of deferred tax liability relating to a prior asset purchase acquisition transaction, realized gain on sale of strategic equity investment, payroll tax on certain stock option exercises and expenses related to stock option investigation and other litigation. Expenses related to stock option investigation consist primarily of fees paid to professional service firms in connection with the Company's internal investigation of historical stock option grant practices and the resulting restatement of the Company's financial statements, the investigations by the Securities and Exchange Commission and the U.S. Attorney's office arising from the internal investigation and the defense of derivative lawsuits arising from the Company's internal investigation and other litigation relates to an accrual made for a potential litigation settlement. Income taxes are adjusted to an estimated non-GAAP effective tax rate. These non-GAAP measures are not a substitute for GAAP measures and may not be consistent with the presentation used by other companies. The Company uses the non-GAAP financial measures to evaluate and manage its operations. The Company is providing this information to allow investors to perform additional financial analysis and because it is consistent with the financial models and estimates published by analysts who follow the Company. The attached schedule reconciles non-GAAP results and other financial measures reported by the Company with the most directly comparable GAAP financial measures.
AMCC management will be holding a conference call today, April 30, 2009, at 2:00 p.m. Pacific Time/5:00 p.m. Eastern Time to discuss additional details regarding the Company's performance for the fourth quarter of fiscal 2009 and to provide guidance for the first quarter of fiscal 2010. You may access the conference call via any of the following:
Teleconference: 719-325-4830 Conference ID: 1494407 Web Broadcast: http://investor.amcc.com/events.cfm Replay: 719-457-0820 (available through May 5, 2009)
AMCC Overview
AMCC is a global leader in energy efficient sustainable solutions to Process, Transport, and Store information for the next generation of internet data center and carrier central office. As a leader in high speed signal processing, IP & Ethernet packet processing, and storage processing, AMCC's patented innovations provide high value highly integrated Systems On a Chip (SoCs) for Telecom, Enterprise and Consumer Applications.
AMCC's corporate headquarters are located in Sunnyvale, California. Sales and engineering offices are located throughout the world. We maintain a web site to which we regularly post copies of our press releases, our filings with the Securities and Exchange Commission and additional information about us. Interested persons can also subscribe on our web site to email alerts or RSS feeds. Please visit www.amcc.com.
This news release contains forward-looking statements that reflect the Company's current view with respect to future events and financial performance, including statements regarding the Company's focus, product cycles, design-win pipeline, strategic re-focus and future revenues. These forward-looking statements are only predictions based on current information and expectations and are subject to certain risks and uncertainties, including, but not limited to, customer demand for the Company's products, the businesses of the Company's major customers, reductions, rescheduling or cancellation of orders by the Company's customers, successful and timely development of products, market acceptance of new products, and general economic conditions. More information about potential factors that could affect the Company's business and financial results is included in the "Risk Factors" set forth in the Company's Annual Report on Form 10-K for the year ended March 31, 2008, and the Company's other filings with the Securities and Exchange Commission. Actual results could differ materially, as a result of such factors, from those set forth in the forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the issuance of this press release.
APPLIED MICRO CIRCUITS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
-------- --------
March 31, March 31,
ASSETS 2009 2008
-------- --------
Current assets:
Cash, cash equivalents and short-term
investments $184,009 $142,889
Accounts receivable, net 17,537 28,800
Inventories 26,598 30,293
Other current assets 8,871 11,097
Assets of discontinued operations 8,558 8,678
-------- --------
Total current assets 245,573 221,757
Marketable securities -- 51,919
Property and equipment, net 25,749 25,233
Goodwill -- 264,130
Purchased intangibles 32,965 56,025
Other assets 20,323 13,783
-------- --------
Total assets $324,610 $632,847
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 16,715 $ 25,518
Other current liabilities 23,925 22,659
-------- --------
Total current liabilities 40,640 48,177
Deferred tax liability -- 3,958
Stockholders' equity 283,970 580,712
-------- --------
Total liabilities and stockholders' equity $324,610 $632,847
======== ========
APPLIED MICRO CIRCUITS CORPORATION
GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended Year Ended
------------------------------ ---------------------
March 31, Dec. 31, March 31, March 31, March 31,
2009 2008 2008 2009 2008
------------------------------ ---------------------
Net revenues $ 41,001 $ 47,726 $ 58,557 $ 214,216 $ 194,115
Cost of revenues 21,842 22,226 28,874 101,070 98,756
--------- ---------- --------- ---------- ----------
Gross profit 19,159 25,500 29,683 113,146 95,359
Operating
expenses:
Research and
development 24,202 18,625 19,916 84,687 86,117
Selling,
general and
administra-
tive 11,151 11,315 13,095 50,097 52,037
Amortization
of purchased
intangibles 1,005 1,005 1,005 4,020 4,061
Impairment of
goodwill -- 222,972 -- 222,972 --
Restructuring
charges, net 7,717 1,024 1,489 8,623 2,958
Litigation
settlement -- -- 1,125 130 1,125
Option
investigation
related
expenses, net (4) (79) 1,363 80 1,072
--------- ---------- --------- ---------- ----------
Total
operating
expenses 44,071 254,862 37,993 370,609 147,370
--------- ---------- --------- ---------- ----------
Operating loss (24,912) (229,362) (8,310) (257,463) (52,011)
Interest and
other (expense)
income,
net 1,693 (7,397) (1,551) (7,581) 10,579
--------- ---------- --------- ---------- ----------
Loss from
continuing
operations,
before
income taxes (23,219) (236,759) (9,861) (265,044) (41,432)
Income tax
expense
(benefit) (455) (4,396) 4,135 (3,946) 3,773
--------- ---------- --------- ---------- ----------
Loss from
continuing
operations (22,764) (232,363) (13,996) (261,098) (45,205)
Loss from
discontinue
operations, net
of tax (a) (4,622) (42,097) (72,313) (48,235) (69,916)
--------- ---------- --------- ---------- ----------
Net loss $(27,386) $(274,460) $(86,309) $(309,333) $(115,121)
========= ========== ========= ========== ==========
Basic and diluted
loss per share:
Loss per
share from
continuing
operations $ (0.35) $ (3.55) $ (0.22) $ (4.00) $ (0.67)
Loss per
share
from
discontinued
operations (0.07) (0.65) (1.11) (0.74) (1.03)
--------- ---------- --------- ---------- ----------
Net loss per
share $ (0.42) $ (4.20) $ (1.33) $ (4.74) $ (1.70)
========= ========== ========= ========== ==========
Shares used in
calculating
basic and
diluted loss
per share 65,703 65,366 64,886 65,271 67,775
========= ========== ========= ========== ==========
(a) The following table provides information on the components of the loss from discontinued operations for the periods presented:
Components of discontinued operations
Three Months Ended Year Ended
------------------------------ ---------------------
March 31, Dec. 31, March 31, March 31, March 31,
2009 2008 2008 2009 2008
------------------------------ ---------------------
Net revenues $ 4,508 $ 9,839 $ 12,977 $ 39,849 $ 52,031
Cost of revenues 4,071 5,537 7,657 24,437 27,912
--------- ---------- --------- ---------- ----------
Gross profit 437 4,302 5,320 15,412 24,119
Operating
expenses:
Research and
development 2,758 2,630 2,976 11,470 11,433
Selling,
general and
administrative 2,142 2,103 2,774 9,561 9,870
Amortization of
purchased
intangibles 315 315 315 1,260 1,260
Impairment of
goodwill -- 41,158 71,494 41,158 71,494
Restructuring
charges, net -- 126 27 126 27
--------- ---------- --------- ---------- ----------
Total
operating
expenses 5,215 46,332 77,586 63,575 94,084
--------- ---------- --------- ---------- ----------
Loss from
discontinued
operations,
before income
taxes (4,778) (42,030) (72,266) (48,163) (69,965)
Income tax
expense
(benefit) (156) 67 47 72 (49)
--------- ---------- --------- ---------- ----------
Loss from
discontinued
operations,
net of tax $ (4,622) $ (42,097) $(72,313) $ (48,235) $ (69,916)
========= ========== ========= ========== ==========
APPLIED MICRO CIRCUITS CORPORATION
RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET INCOME (LOSS)
FOR CONTINUING AND DISCONTINUED OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended Year Ended
----------------------------- -------------------
March 31, Dec. 31, March 31, March 31, March 31,
2009 2008 2008 2009 2008
----------------------------- -------------------
GAAP loss - from
continuing
operations $(22,764) $(232,363) $(13,996) $(261,098) $(45,205)
Adjustments:
Stock-based
compensation
charges 2,076 1,547 2,691 9,185 10,056
Amortization of
purchased
intangibles 4,588 4,588 4,863 18,900 19,601
Impairment of
goodwill -- 222,972 -- 222,972 --
Restructuring
charges, net 7,717 1,024 1,489 8,623 2,958
Impairment of
strategic
investment -- -- 3,000 -- 3,000
Other than
temporary
investment
impairment 203 10,104 836 17,144 1,682
Gain on
renegotiated
design tool
agreement -- -- -- -- (749)
Realized gain on
sale of
strategic
equity
investment -- -- -- -- (4,649)
Payroll taxes on
certain stock
option
exercises -- -- -- -- 3
Litigation
settlement -- -- 1,125 130 1,125
Option
investigation
related
expenses, net (4) (79) 1,363 80 1,072
Income tax
adjustments (196) (4,498) 3,970 (4,306) 3,993
Total GAAP to
non-GAAP
adjustments -
continuing -------- --------- -------- --------- --------
operations 14,384 235,658 19,337 272,728 38,092
-------- --------- -------- --------- --------
Non-GAAP income
(loss) -
continuing
operations $ (8,380) $ 3,295 $ 5,341 $ 11,630 $ (7,113)
======== ========= ======== ========= ========
Diluted income
(loss) per share
- continuing
operations $ (0.13) $ 0.05 $ 0.08 $ 0.18 $ (0.10)
======== ========= ======== ========= ========
Shares used in
calculating
diluted income
(loss) per share 65,703 65,531 65,039 65,480 67,775
======== ========= ======== ========= ========
Income (loss) per
share -
continuing
operations:
GAAP loss per
share -
continuing
operations $ (0.35) $ (3.55) $ (0.22) $ (4.00) $ (0.67)
GAAP to non-GAAP
adjustments 0.22 3.60 0.30 4.18 0.57
-------- --------- -------- --------- --------
Non-GAAP income
(loss) per share
- continuing
operations $ (0.13) $ 0.05 $ 0.08 $ 0.18 $ (0.10)
======== ========= ======== ========= ========
Reconciliation of
shares used in
calculating the
non-GAAP income
per share:
Shares used in
calculating the
basic and
diluted income
(loss) per
share 65,703 65,366 64,886 65,271 67,775
Adjustment for
dilutive
securities -- 165 153 209 --
-------- --------- -------- --------- --------
Non-GAAP shares
used in the EPS
calculation 65,703 65,531 65,039 65,480 67,775
======== ========= ======== ========= ========
Discontinued
operations
GAAP loss from
discontinued
operations $ (4,622) $ (42,097) $(72,313) $ (48,235) $(69,916)
Adjustments:
Stock-based
compensation
charges 197 358 387 1,198 1,251
Amortization of
purchased
intangibles 1,040 1,040 1,040 4,160 4,160
Impairment of
goodwill -- 41,158 71,494 41,158 71,494
Restructuring
charges, net -- 126 27 126 27
Impairment of
strategic
investment
Income tax
adjustments (50) 47 27 118 (258)
Total GAAP to
non-GAAP
adjustments -
discontinued -------- --------- -------- --------- --------
operations 1,187 42,729 72,975 46,760 76,674
-------- --------- -------- --------- --------
Non-GAAP income
(loss) -
discontinued
operations $ (3,435) $ 632 $ 662 $ (1,475) $ 6,758
======== ========= ======== ========= ========
Income (loss) per
share -
discontinued
operations:
GAAP income
(loss) per
share -
discontinued
operations $ (0.07) $ (0.64) $ (1.11) $ (0.74) $ (1.03)
GAAP to non-GAAP
adjustments 0.02 0.65 1.12 0.72 1.13
-------- --------- -------- --------- --------
Non-GAAP income
(loss) per share
- discontinued
operations $ (0.05) $ 0.01 $ 0.01 $ (0.02) $ 0.10
======== ========= ======== ========= ========
APPLIED MICRO CIRCUITS CORPORATION
RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES TO THE
MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASURE
(in thousands)
(unaudited)
The following schedule reconciles certain GAAP financial measures
to their corresponding non-GAAP financial measure
Three Months Ended Year Ended
----------------------------- -------------------
March 31, Dec. 31, March 31, March 31, March 31,
2009 2008 2008 2009 2008
----------------------------- -------------------
GROSS PROFIT:
GAAP gross profit $19,159 $ 25,500 $ 29,683 $ 113,146 $ 95,359
Gross profit from
discontinued
operations 437 4,302 5,320 15,412 24,119
Amortization of
purchased
intangibles 4,308 4,308 4,583 17,780 18,440
Stock-based
compensation
expense 61 91 135 548 671
------- --------- --------- --------- --------
Non-GAAP gross
profit -
consolidated
operations $23,965 $ 34,201 $ 39,721 $ 146,886 $138,589
======= ========= ========= ========= ========
OPERATING EXPENSES:
GAAP operating
expenses $44,071 $ 254,862 $ 37,993 $ 370,609 $147,370
Operating
expenses from
discontinued
operations 5,215 46,332 77,586 63,575 94,084
Stock-based
compensation
expense (2,212) (1,814) (2,943) (9,835) (10,636)
Amortization of
purchased
intangibles (1,320) (1,320) (1,320) (5,280) (5,321)
Impairment of
goodwill -- (264,130) (71,494) (264,130) (71,494)
Restructuring
charges, net (7,717) (1,150) (1,516) (8,749) (2,985)
Gain on
renegotiated
design tool
agreement -- -- -- -- 749
Payroll taxes on
certain stock
option
exercises -- -- -- -- (3)
Litigation
settlement -- -- (1,125) (130) (1,125)
Option
investigation
related
expenses, net 4 79 (1,363) (80) (1,072)
------- --------- --------- --------- --------
Non-GAAP operating
expenses -
consolidated
operations $38,041 $ 32,859 $ 35,818 $ 145,980 $149,567
======= ========= ========= ========= ========
INTEREST AND OTHER
INCOME, NET
GAAP interest and
other income
(expense), net $ 1,693 $ (7,397) $ (1,551) $ (7,581) $ 10,579
Realized gain
on sale of
strategic
equity
investments -- -- -- -- (4,649)
Impairment of
strategic
investment -- -- 3,000 -- 3,000
Other than
temporary
investment
impairment 203 10,104 836 17,144 1,682
------- --------- --------- --------- --------
Non-GAAP interest
and other
income, net -
consolidated
operations $ 1,896 $ 2,707 $ 2,285 $ 9,563 $ 10,612
======= ========= ========= ========= ========
INCOME TAX EXPENSE
(BENEFIT):
GAAP income tax
expense (benefit) $ (455) $ (4,396) $ 4,135 $ (3,946) $ 3,773
Income tax
expense
(benefit) from
discontinued
operations (156) 67 47 72 (49)
Income tax
adjustments 246 4,450 (3,996) 4,188 (3,735)
------- --------- --------- --------- --------
Non-GAAP income
tax expense
(benefit) -
consolidated
operations $ (365) $ 121 $ 186 $ 314 $ (11)
======= ========= ========= ========= ========
RESEARCH AND
DEVELOPMENT
GAAP research and
development $24,202 $ 18,625 $ 19,916 $ 84,687 $ 86,117
Research and
development
from
discontinued
operations 2,758 2,630 2,976 11,470 11,433
Stock-based
compensation
expense (853) (1,244) (1,349) (4,532) (4,797)
Gain on
renegotiated
design tool
agreement -- -- -- -- 749
Payroll taxes on
certain stock
option
exercises -- -- -- -- (2)
------- --------- --------- --------- --------
Non-GAAP
research and
development -
consolidated
operations $26,107 $ 20,011 $ 21,543 $ 91,625 $ 93,500
======= ========= ========= ========= ========
SELLING, GENERAL
AND
ADMINISTRATIVE
GAAP selling,
general and
administrative $11,151 $ 11,315 $ 13,095 $ 50,097 $ 52,037
Selling, general
and
administrative
expenses from
discontinued
operations 2,142 2,103 2,774 9,561 9,870
Stock-based
compensation
expense (1,359) (570) (1,594) (5,303) (5,839)
Payroll taxes on
certain stock
option
exercises -- -- -- -- (1)
------- --------- --------- --------- --------
Non-GAAP selling,
general and
administrative
- consolidated
operations $11,934 $ 12,848 $ 14,275 $ 54,355 $ 56,067
======= ========= ========= ========= ========
APPLIED MICRO CIRCUITS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Year Ended March 31,
-----------------------
2009 2008
----------- ----------
Operating activities:
Net loss $ (309,333) $ (115,121)
Adjustments to reconcile net loss to net
cash provided by (used for) operating
activities
Depreciation 6,862 6,542
Amortization of purchased intangibles 23,060 23,762
Impairment of goodwill 264,130 71,494
Stock-based compensation expense:
Stock options 5,309 9,350
Restricted stock units 5,222 1,957
Non-cash restructuring charges 1,088 316
Litigation settlement -- 1,125
Net gain on sale of strategic equity
investment -- (4,649)
Impairment of strategic investment -- 3,000
Impairment of short-term investments
and marketable securities 17,144 1,682
Net loss on disposal of property 48 23
Changes in operating assets and
liabilities:
Accounts receivable 11,263 3,758
Inventories 3,414 (6,680)
Other assets (4,141) 2,282
Accounts payable (8,803) (1,375)
Accrued payroll and other accrued
liabilities 597 (7,103)
Deferred taxes (3,957) 3,957
Deferred revenue 668 (476)
----------- ----------
Net cash provided by (used for)
operating activities 12,571 (6,156)
Investing activities:
Proceeds from sales and maturities
investments 1,117,424 623,619
Purchases of investments (1,068,205) (550,137)
Purchase of strategic investments -- (5,000)
Net proceeds from the sale of strategic
equity investment -- 5,249
Purchase of property, equipment and
other assets (7,259) (7,021)
Proceeds from sale of property,
equipment and other assets -- 1,646
Net cash paid for acquisitions -- 232
----------- ----------
Net cash provided by investing
activities 41,960 68,588
Financing activities:
Proceeds from issuance of common stock 2,448 6,431
Repurchase of Company stock -- (56,950)
Funding of structured stock repurchase
agreements -- (41,830)
Funds received from structured stock
repurchase agreements including gains -- 21,112
Other (331) (101)
----------- ----------
Net cash provided by (used for)
financing activities 2,117 (71,338)
----------- ----------
Net increase (decrease) in cash and
cash equivalents 56,648 (8,906)
Cash and cash equivalents at beginning of
the period 42,689 51,595
----------- ----------
Cash and cash equivalents at end of the
period $ 99,337 $ 42,689
=========== ==========