NXP Semiconductors
Table 1: Condensed consolidated statement
of operations (unaudited)
($ in millions except share data) Three Months Ended
-------------------------------
March 30, Dec. 31, March 31,
2014 2013 2013
--------- --------- ---------
Revenue $ 1,246 $ 1,293 $ 1,085
Cost of revenue (661) (704) (602)
--------- --------- ---------
Gross profit 585 589 483
Research and development (189) (168) (153)
Selling, general and administrative (213) (224) (222)
--------- --------- ---------
Total operating expenses (402) (392) (375)
Other income (expense) - 1 7
--------- --------- ---------
Operating income (loss) 183 198 115
Financial income (expense):
Interest income (expense) - net (34) (39) (49)
Foreign exchange gain (loss) (2) 31 (53)
Gain (loss) on extinguishment of long
term debt (3) (54) (37)
Other financial expense (6) (17) (13)
--------- --------- ---------
Income (loss) before taxes 138 119 (37)
Benefit (provision) for income taxes (15) (10) (11)
Results relating to equity-accounted
investees 1 6 47
--------- --------- ---------
Net income (loss) 124 115 (1)
Net (income) loss attributable to non-
controlling interests (14) (19) (13)
--------- --------- ---------
Net income (loss) attributable to
stockholders 110 96 (14)
Earnings per share data:
Net income (loss) attributable to
stockholders per common share
Basic earnings per common share in $ $ 0.45 $ 0.39 $ (0.06)
Diluted earnings per common share in $ $ 0.43 $ 0.37 $ (0.06)
Weighted average number of shares of common
stock (in thousands):
Basic 245,300 246,842 249,668
Diluted 255,167 256,162 249,668
NXP Semiconductors
Table 2: Condensed consolidated balance sheet (unaudited)
($ in millions) As of
-----------------------------
March 30, Dec. 31, March 31,
2014 2013 2013
--------- --------- ---------
Current assets:
Cash and cash equivalents $ 720 $ 670 $ 595
Accounts receivable - net 556 501 464
Other receivables 34 41 48
Assets held for sale 11 13 10
Inventories 740 740 730
Other current assets 126 127 109
--------- --------- ---------
Total current assets 2,187 2,092 1,956
Non-current assets:
Investments in equity-accounted investees 53 52 46
Other non-current assets 143 144 131
Property, plant and equipment 1,045 1,048 1,039
Identified intangible assets 707 755 888
Goodwill 2,354 2,358 2,221
--------- --------- ---------
Total non-current assets 4,302 4,357 4,325
Total assets 6,489 6,449 6,281
Current liabilities:
Accounts payable 558 544 513
Liabilities held for sale 1 1 -
Accrued liabilities 639 608 599
Short-term debt 37 40 291
--------- --------- ---------
Total current liabilities 1,235 1,193 1,403
Non-current liabilities:
Long-term debt 3,546 3,281 3,149
Other non-current liabilities 425 429 454
--------- --------- ---------
Total non-current liabilities 3,971 3,710 3,603
Non-controlling interests 259 245 248
Stockholders' equity 1,024 1,301 1,027
--------- --------- ---------
Total equity 1,283 1,546 1,275
Total liabilities and equity 6,489 6,449 6,281
NXP Semiconductors
Table 3: Condensed consolidated statement of cash flows (unaudited)
($ in millions) Three Months Ended
-------------------------------
March 30, Dec. 31, March 31,
2014 2013 2013
--------- --------- ---------
Cash Flows from operating activities
Net income (loss) $ 124 $ 115 $ (1)
Adjustments to reconcile net income (loss):
Depreciation and amortization 102 113 132
Stock-based compensation 28 31 17
Net (gain) loss on sale of assets - - (1)
(Gain) loss on extinguishment of debt 3 54 37
Results relating to equity accounted
investees (1) (6) (47)
Changes in operating assets and
liabilities:
(Increase) decrease in trade receivables (55) 37 (15)
(Increase) decrease in inventories 1 13 (20)
Increase (decrease) in trade payables 14 (4) (44)
(Increase) decrease in other receivables 12 10 (8)
Increase (decrease) in other payables 35 (21) 17
Changes in deferred taxes 3 1 1
Exchange differences 2 (31) 53
Other items 5 2 (2)
--------- --------- ---------
Net cash provided by (used for) operating
activities 273 314 119
Cash flows from investing activities:
Purchase of identified intangible assets (9) (8) (6)
Capital expenditures on property, plant
and equipment (51) (71) (41)
Proceeds from disposals of property,
plant and equipment 1 1 2
Proceeds from disposals of assets held
for sale 3 - -
Proceeds from sale of interests in
businesses - 3 -
Proceeds from return of equity investment - 3 -
Other - (3) 2
--------- --------- ---------
Net cash (used for) provided by investing
activities (56) (75) (43)
Cash flows from financing activities:
Net (repayments) borrowings of short-term
debt (1) (2) (1)
Repayments under the revolving credit
facility (100) - (280)
Amounts drawn under the revolving credit
facility 450 150 180
Repurchase of long-term debt (92) (575) (980)
Principal payments on long-term debt (1) (7) (4)
Net proceeds from the issuance of long-
term debt - 1 990
Dividends paid to non-controlling
interests - (1) -
Purchase of non-controlling interests
(shares) - (12) -
Cash proceeds from exercise of stock
options 40 98 40
Purchase of treasury shares (458) (163) (35)
--------- --------- ---------
Net cash provided by (used for) financing
activities (162) (511) (90)
Effect of changes in exchange rates on cash
positions (5) 1 (8)
--------- --------- ---------
Increase (decrease) in cash and cash
equivalents 50 (271) (22)
Cash and cash equivalents at beginning of
period 670 941 617
--------- --------- ---------
Cash and cash equivalents at end of period 720 670 595
Non-Cash Financing
Exchange of Term Loan C for Term Loan D - 400 -
Exchange of Term Loan A1 for Term Loan E 400 - -
NXP Semiconductors
Table 4: Reconciliation of GAAP to non-GAAP Segment Results (unaudited)
($ in millions) Three Months Ended
-------------------------------
March 30, Dec. 31, March 31,
2014 2013 2013
--------- --------- ---------
High Performance Mixed Signal (HPMS) 912 957 776
Standard Products 295 294 279
--------- --------- ---------
Product Revenue 1,207 1,251 1,055
Corporate and Other 39 42 30
--------- --------- ---------
Total Revenue $ 1,246 $ 1,293 $ 1,085
========= ========= =========
HPMS Revenue $ 912 $ 957 $ 776
Percent of Total Revenue 73.2% 74.0% 71.5%
HPMS segment GAAP gross profit 508 523 417
PPA effects (1) (3) -
Restructuring - (3) (1)
Stock based compensation (2) (2) (1)
Other incidentals - (10) -
Other adjustments - - (46)
--------- --------- ---------
HPMS segment non-GAAP gross profit $ 511 $ 541 $ 465
========= ========= =========
HPMS segment GAAP gross margin 55.7% 54.6% 53.7%
HPMS segment non-GAAP gross margin 56.0% 56.5% 59.9%
HPMS segment GAAP operating profit 200 227 123
PPA effects (24) (26) (46)
Restructuring (2) (2) (1)
Stock based compensation (22) (24) (12)
Other incidentals (1) (11) (1)
Other adjustments - - (46)
--------- --------- ---------
HPMS segment non-GAAP operating profit $ 249 $ 290 $ 229
========= ========= =========
HPMS segment GAAP operating margin 21.9% 23.7% 15.9%
HPMS segment non-GAAP operating margin 27.3% 30.3% 29.5%
Standard Products Revenue $ 295 $ 294 $ 279
Percent of Total Revenue 23.7% 22.7% 25.7%
Standard Products segment GAAP gross
profit 85 66 70
PPA effects - (1) (1)
Restructuring (7) (18) (1)
Stock based compensation (1) (1) -
Other incidentals (5) (6) (1)
--------- --------- ---------
Standard Products segment non-GAAP gross
profit $ 98 $ 92 $ 73
========= ========= =========
Standard Products segment GAAP gross
margin 28.8% 22.4% 25.1%
Standard Products segment non-GAAP
gross margin 33.2% 31.3% 26.2%
Standard Products segment GAAP operating
profit 12 2 7
PPA effects (15) (15) (15)
Restructuring (15) (18) (1)
Stock based compensation (6) (7) (4)
Other incidentals (5) (6) (1)
--------- --------- ---------
Standard Products segment non-GAAP
operating profit $ 53 $ 48 $ 28
========= ========= =========
Standard Products segment GAAP
operating margin 4.1% 0.7% 2.5%
Standard Products segment non-GAAP
operating margin 18.0% 16.3% 10.0%
Corporate and Other Revenue $ 39 $ 42 $ 30
Percent of Total Revenue 3.1% 3.3% 2.8%
Corporate and Other segment GAAP gross
profit (8) - (4)
PPA effects (2) (2) (2)
Restructuring (16) - -
Stock based compensation - - -
Other incidentals 2 (1) (1)
--------- --------- ---------
Corporate and Other segment non-GAAP
gross profit $ 8 $ 3 $ (1)
========= ========= =========
Corporate and Other segment GAAP gross
margin -20.5% 0.0% -13.3%
Corporate and Other segment non-GAAP
gross margin 20.5% 7.1% -3.3%
Corporate and Other segment GAAP
operating profit (29) (31) (15)
PPA effects (7) (6) (6)
Restructuring (16) (3) (2)
Stock based compensation - - (1)
Other incidentals (5) (8) (4)
--------- --------- ---------
Corporate and Other segment non-GAAP
operating profit $ (1) $ (14) $ (2)
========= ========= =========
Corporate and Other segment GAAP
operating margin -74.4% -73.8% -50.0%
Corporate and Other segment non-GAAP
operating margin -2.6% -33.3% -6.7%
NXP Semiconductors
Table 5: Financial Reconciliation of GAAP to non-GAAP Results (unaudited)
($ in millions except share data) Three Months Ended
----------------------------------
March 30, Dec. 31, March 31,
2014 2013 2013
--------- --------- ---------
Revenue $ 1,246 $ 1,293 $ 1,085
GAAP Gross profit $ 585 $ 589 $ 483
PPA effects (3) (6) (3)
Restructuring (23) (21) (2)
Stock Based Compensation (3) (3) (1)
Other incidentals (3) (17) (2)
Other adjustments - - (46)
--------- --------- ---------
Non-GAAP Gross profit $ 617 $ 636 $ 537
========= ========= =========
GAAP Gross margin 47.0% 45.6% 44.5%
Non-GAAP Gross margin 49.5% 49.2% 49.5%
GAAP Research and development $ (189) $ (168) $ (153)
PPA effects - - -
Restructuring (9) 1 -
Stock based compensation (3) (5) (3)
Other incidentals (1) (1) (1)
--------- --------- ---------
Non-GAAP Research and development $ (176) $ (163) $ (149)
========= ========= =========
GAAP Selling, general and
administrative $ (213) $ (224) $ (222)
PPA effects (41) (41) (64)
Restructuring (1) (3) (2)
Stock based compensation (22) (23) (13)
Other incidentals (8) (7) (3)
--------- --------- ---------
Non-GAAP Selling, general and
administrative $ (141) $ (150) $ (140)
========= ========= =========
GAAP Other income (expense) $ - $ 1 $ 7
PPA effects (2) - -
Restructuring - - -
Other incidentals 1 - -
--------- --------- ---------
Non-GAAP Other income (expense) $ 1 $ 1 $ 7
========= ========= =========
GAAP Operating income (loss) $ 183 $ 198 $ 115
PPA effects (46) (47) (67)
Restructuring (33) (23) (4)
Stock based compensation (28) (31) (17)
Other incidentals (11) (25) (6)
Other adjustments - - (46)
--------- --------- ---------
Non-GAAP Operating income (loss) $ 301 $ 324 $ 255
========= ========= =========
GAAP Operating margin 14.7% 15.3% 10.6%
Non-GAAP Operating margin 24.2% 25.1% 23.5%
GAAP Financial income (expense) $ (45) $ (79) $ (152)
Foreign exchange gain (loss) on debt (2) 31 (53)
Gain (loss) on extinguishment of long
term debt (3) (54) (37)
Other financial expense (6) (17) (13)
--------- --------- ---------
Non-GAAP Financial income (expense) $ (34) $ (39) $ (49)
========= ========= =========
GAAP Income tax benefit (provision) $ (15) $ (10) $ (11)
Other adjustments (11) 3 (4)
--------- --------- ---------
Non-GAAP Cash tax (expense) $ (4) $ (13) $ (7)
========= ========= =========
GAAP Results relating to equity-
accounted investees $ 1 $ 6 $ 47
Other adjustments 1 6 47
--------- --------- ---------
Non-GAAP Results relating to equity-
accounted investees $ - $ - $ -
========= ========= =========
GAAP Net income (loss) $ 124 $ 115 $ (1)
PPA effects (46) (47) (67)
Restructuring (33) (23) (4)
Stock based compensation (28) (31) (17)
Other incidentals (11) (25) (6)
Other adjustments (21) 1) (31) (106)
--------- --------- ---------
Non-GAAP Net income (loss) $ 263 $ 272 $ 199
========= ========= =========
GAAP Net income (loss) attributable to
stockholders $ 110 $ 96 $ (14)
PPA effects (46) (47) (67)
Restructuring (33) (23) (4)
Stock based compensation (28) (31) (17)
Other incidentals (11) (25) (6)
Other adjustments (21) (31) (106)
--------- --------- ---------
Non-GAAP Net income (loss) attributable
to stockholders $ 249 $ 253 $ 186
========= ========= =========
GAAP Weighted average shares - diluted 255,167 256,162 249,668
Non-GAAP Adjustment - - 8,157
--------- --------- ---------
Non-GAAP Weighted average shares -
diluted 255,167 256,162 257,825
========= ========= =========
GAAP Diluted net income (loss)
attributable to stockholders per share $ 0.43 $ 0.37 $ (0.06)
Non-GAAP Diluted net income (loss)
attributable to stockholders per share $ 0.98 $ 0.99 $ 0.72
1) Includes: During 1Q14: Foreign exchange loss on debt: ($2) million; Loss on extinguishment of long-term debt: ($3) million; Other financial
expense: ($6) million; Results relating to equity-accounted investees: $1 million; and difference between book and cash income taxes: ($11)
million.
NXP Semiconductors
Table 6: Adjusted EBITDA and Free Cash Flow (unaudited)
($ in millions) Three Months Ended
-------------------------------
March 30, Dec. 31, March 31,
2014 2013 2013
--------- --------- ---------
Net Income $ 124 $ 115 $ (1)
========= ========= =========
Reconciling items to EBITDA
Financial (income) expense 45 79 152
(Benefit) provision for income taxes 15 10 11
Depreciation 52 61 61
Amortization 50 52 71
--------- --------- ---------
EBITDA $ 286 $ 317 $ 294
========= ========= =========
Reconciling items to adjusted EBITDA
Results of equity-accounted investees (1) (6) (47)
Restructuring 1) 33 21 4
Stock based compensation 28 31 17
Other incidental items 1) 11 24 5
Other adjustments - - 46
--------- --------- ---------
Adjusted EBITDA $ 357 $ 387 $ 319
========= ========= =========
Trailing twelve month adjusted EBITDA $ 1,414 $ 1,376 $ 1,195
1) Excluding depreciation property, plant and equipment and amortization
software related to:
Restructuring - 2 -
Other incidental items - 1 1
($ in millions) Three Months Ended
-------------------------------
March 30, Dec. 31, March 31,
2014 2013 2013
--------- --------- ---------
Net cash provided by (used for) operating
activities $ 273 $ 314 $ 119
========= ========= =========
Net capital expenditures on property, plant
and equipment (50) (70) (39)
--------- --------- ---------
Non-GAAP free cash flow $ 223 $ 244 $ 80
Non-GAAP free cash flow as a percent of
Revenue 18% 19% 7%
NXP Semiconductors Reports First Quarter 2014 Results
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