MILPITAS, Calif. — (BUSINESS WIRE) — October 14, 2014 — Linear Technology Corporation (NASDAQ: LLTC), a leading, independent manufacturer of high performance linear integrated circuits, today reported financial results for the fiscal quarter ended September 28, 2014. Quarterly revenues of $371.1 million for the first quarter of fiscal year 2015 increased $5.6 million or 1.5% over the previous quarter's revenue of $365.4 million and increased $30.7 million or 9.0% over $340.4 million reported in the first quarter of fiscal year 2014. Net income of $129.5 million decreased $0.3 million from the fourth quarter of fiscal year 2014 and increased $21.6 million or 20.0% over the first quarter of fiscal year 2014. First quarter net income and earnings per share were negatively impacted by a higher effective income tax rate of 26% that more than offset the benefit of lower interest expense that resulted from the extinguishment of the Convertible Senior Notes at the end of fiscal 2014. Diluted earnings per share of $0.53 per share in the first quarter of fiscal year 2015 was flat compared to the fourth quarter of fiscal year 2014 and increased $0.08 per share or 18% over the first quarter of fiscal year 2014.
Our cash, cash equivalents and marketable securities increased by $14.9 million over the fourth quarter of fiscal year 2014 to $1,028 million. A cash dividend of $0.27 per share will be paid on November 26, 2014 to stockholders of record on November 14, 2014. During the first quarter the Company generated positive cash flows from operations of $136.4 million or 36.8% of total revenues. The Company has historically generated strong cash flows from its operations. During the first quarter of fiscal year 2015 the Company returned $99.8 million to shareholders in the form of dividends of $65.7 million, representing $0.27 per share and stock purchases of $34.1 million. The Board of Directors authorized the Company to purchase, depending on market conditions, up to 10 million shares of its outstanding common stock in the open market over the next two years.
According to Lothar Maier, CEO, “For our first fiscal quarter, we grew revenue $5.6 million which approximated the midpoint of our guidance, of 1% to 3%, and represented 9% growth over the similar quarter in the prior year. Operating income grew in concert with sales and remained an industry leading 47% of sales. Bookings were down from the prior quarter while our book to bill ratio was only modestly negative. Seasonally this is typical performance for us as our major end markets, industrial and automotive, generally experience some softness in the summer and fall, but show strength in the first half of the calendar year. The industrial end-market was 43% of our business, down from 44% last quarter whereas automotive at 19% was similar to last quarter.
“Looking forward, revenue in the December quarter is typically down from the September quarter, averaging down sequentially 6% over the past four years. Based upon this and our current bookings rate, we are forecasting revenue to be down 3% to 6% sequentially though up year over year in the 4% to 8% range. Overall, we remain optimistic about the increased electronics content in our end markets, especially automotive and industrial.”
Except for historical information contained herein, the matters set forth in this press release are forward-looking statements. In particular, the statements regarding the demand for our products, our customers' ordering patterns and the anticipated trends in our sales and profits are forward-looking statements. The forward-looking statements are dependent on certain risks and uncertainties, including such factors, among others, as the timing, volume and pricing of new orders received and shipped, the timely introduction of new processes and products, general and country specific conditions in the world economy and financial markets and other factors described in our 10-K for the quarter ended June 29, 2014.
Company officials will be discussing these results in greater detail in a conference call tomorrow, Wednesday, October 15, 2014 at 8:30 a.m. Pacific Coast Time. Those investors wishing to listen in may call 719-457-2643, or toll free 800-500-0920 before 8:15 a.m. to be included in the audience. There will be a live webcast of this conference call that can be accessed through www.linear.com or www.streetevents.com. A replay of the conference call will be available from October 15, 2014 through October 22, 2014. You may access the archive by calling (719) 457-0820 or toll free (888) 203-1112 and entering reservation #1896570. An archive of the webcast will also be available at www.linear.com and www.streetevents.com as of October 22, 2014 until the first quarter earnings release next year.
Linear Technology Corporation, a member of the S&P 500, has been designing, manufacturing and marketing a broad line of high performance analog integrated circuits for major companies worldwide for over three decades. The Company’s products provide an essential bridge between our analog world and the digital electronics in communications, networking, industrial, automotive, computer, medical, instrumentation, consumer, and military and aerospace systems. Linear Technology produces power management, data conversion, signal conditioning, RF and interface ICs, µModule® subsystems, and wireless sensor network products. For more information, visit www.linear.com.
For further information contact Paul Coghlan at Linear Technology Corporation, 1630 McCarthy Blvd., Milpitas, California 95035-7417, (408) 432-1900.
| LINEAR TECHNOLOGY CORPORATION | |||||||||||
| CONSOLIDATED STATEMENTS OF INCOME | |||||||||||
| (In thousands, except per share amounts) | |||||||||||
| U.S. GAAP (unaudited) | |||||||||||
| Three Months Ended | |||||||||||
| September 28, | June 29, | September 29, | |||||||||
| 2014 | 2014 | 2013 | |||||||||
| Revenues | $ | 371,060 | $ | 365,428 | $ | 340,357 | |||||
| Cost of sales(1) | 89,007 | 87,579 | 84,001 | ||||||||
| Gross profit | 282,053 | 277,849 | 256,356 | ||||||||
| Expenses: | |||||||||||
|
Research and development(1) |
65,600 | 64,785 | 61,512 | ||||||||
| Selling, general and administrative(1) | 42,089 | 41,419 | 38,678 | ||||||||
| Total operating expenses | 107,689 | 106,204 | 100,190 | ||||||||
| Operating income | 174,364 | 171,645 | 156,166 | ||||||||
| Interest expense | — | (2,271 | ) | (6,813 | ) | ||||||
| Amortization of debt discount(2) | — | (1,885 | ) | (5,446 | ) | ||||||
| Interest income and other income | 581 | 452 | 882 | ||||||||
| Income before income taxes | 174,945 | 167,941 | 144,789 | ||||||||
| Provision for income taxes | 45,486 | 38,206 | 36,921 | ||||||||
| Net income | $ | 129,459 | $ | 129,735 | $ | 107,868 | |||||
| Earnings per share: | |||||||||||
| Basic | $ | 0.53 | $ | 0.53 | $ | 0.45 | |||||
| Diluted | $ | 0.53 | $ | 0.53 | $ | 0.45 | |||||
| Shares used in determining earnings per share: | |||||||||||
| Basic | 244,145 | 243,279 | 238,146 | ||||||||
| Diluted | 244,801 | 244,935 | 239,328 | ||||||||
| Includes the following non-cash charges: | |||||||||||
| (1) Stock-based compensation | |||||||||||
| Cost of sales | $ | 2,100 | $ | 2,043 | $ | 1,964 | |||||
| Research and development | 9,791 | 9,513 | 9,162 | ||||||||
| Selling, general and administrative | 5,056 | 4,913 | 4,730 | ||||||||
| (2) Amortization of debt discount | |||||||||||
| (non-cash interest expense) | — | 1,885 | 5,446 | ||||||||
| LINEAR TECHNOLOGY CORPORATION | ||||||||
| CONSOLIDATED CONDENSED BALANCE SHEETS | ||||||||
| (in thousands) | ||||||||
| U.S. GAAP (unaudited) | ||||||||
| September 28, 2014 | June 29, 2014 | |||||||
| ASSETS: | ||||||||
| Current assets: | ||||||||
| Cash, cash equivalents and marketable securities | $ | 1,027,643 | $ | 1,012,787 | ||||
|
Accounts receivable, net of allowance for doubtful accounts of $1,653 ($1,653 at June 29, 2014) |
175,494 | 173,340 | ||||||
| Inventories | 97,642 | 91,310 | ||||||
| Deferred tax assets and other current assets | 86,916 | 87,276 | ||||||
| Total current assets | 1,387,695 | 1,364,713 | ||||||
| Property, plant & equipment, net | 291,333 | 277,080 | ||||||
| Other noncurrent assets | 13,235 | 13,785 | ||||||
| Total assets | $ | 1,692,263 | $ | 1,655,578 | ||||
| LIABILITIES & STOCKHOLDERS’ EQUITY: | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 27,037 | $ | 28,221 | ||||
| Accrued income taxes, payroll & other accrued liabilities | 125,406 | 141,275 | ||||||
| Deferred income on shipments to distributors | 46,705 | 45,619 | ||||||
| Total current liabilities | 199,148 | 215,115 | ||||||
| Deferred tax and other noncurrent liabilities | 109,837 | 109,094 | ||||||
| Stockholders’ equity: | ||||||||
| Common stock | 1,964,206 | 1,948,006 | ||||||
| Accumulated deficit | (581,086 | ) | (616,992 | ) | ||||
| Accumulated other comprehensive loss | 158 | 355 | ||||||
| Total stockholders’ equity | 1,383,278 | 1,331,369 | ||||||
| $ | 1,692,263 | $ | 1,655,578 | |||||
| LINEAR TECHNOLOGY CORPORATION | ||||||||||||
| CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS | ||||||||||||
| (In thousands) | ||||||||||||
| (unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| September 28, | June 29, | September 29, | ||||||||||
| 2014 | 2014 | 2013 | ||||||||||
| Cash flow from operating activities: | ||||||||||||
| Net income | $ | 129,459 | $ | 129,735 | $ | 107,868 | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
| Depreciation and amortization | 13,214 | 12,851 | 12,835 | |||||||||
| Stock-based compensation | 16,947 | 16,469 | 15,856 | |||||||||
| Amortization of convertible senior notes discount | — | 1,885 | 5,446 | |||||||||
| Excess tax benefit from stock-based compensation | (2,202 | ) | (4,101 | ) | (1,529 | ) | ||||||
| Change in operating assets and liabilities: | (21,042 | ) | 46,903 | (18,278 | ) | |||||||
| Cash provided by operating activities | 136,376 | 203,742 | 122,198 | |||||||||
| Cash flow from investing activities: | ||||||||||||
|
Net purchases and proceeds from sale and maturities of available-for-sale securities |
(26,426 | ) | 101,618 | 83,552 | ||||||||
| Purchase of property, plant and equipment | (26,917 | ) | (21,033 | ) | (3,888 | ) | ||||||
| Cash (used in) provided by investing activities | (53,343 | ) | 80,585 | 79,664 | ||||||||
| Cash flow from financing activities: | ||||||||||||
| Extinguishment of Convertible Senior Notes | — | (845,087 | ) | — | ||||||||
| Excess tax benefit from stock-based compensation | 2,202 | 4,101 | 1,529 | |||||||||
| Issuance of common stock under employee stock plans | 3,323 | 9,910 | 21,655 | |||||||||
| Purchase of common stock | (34,086 | ) | (36,202 | ) | (14,671 | ) | ||||||
| Payment of cash dividends | (65,739 | ) | (66,095 | ) | (62,059 | ) | ||||||
| Cash used in financing activities | (94,300 | ) | (933,373 | ) | (53,546 | ) | ||||||
| (Decrease) increase in cash and cash equivalents | (11,267 | ) | (649,046 | ) | 148,316 | |||||||
| Cash and cash equivalents, beginning of period | 157,323 | 806,369 | 126,650 | |||||||||
| Cash and cash equivalents, end of period | $ | 146,056 | $ | 157,323 | $ | 274,966 | ||||||
Contact:
Linear Technology Corporation
Paul Coghlan, 408-432-1900
Vice
President, Finance, Chief Financial Officer