Lattice Semiconductor Reports Third Quarter Financial Results

Lattice continues to deliver "More of the Best" to its customers with comprehensive solutions for system design, including an unequaled portfolio of high performance, non-volatile and low cost FPGAs.

Lattice products are sold worldwide through an extensive network of independent sales representatives and distributors, primarily to OEM customers in communications, computing, industrial, consumer, automotive, medical and military end markets. For more information, visit http://www.latticesemi.com.

Lattice Semiconductor Corporation, Lattice (& design), L (& design), ispLEVER, Reveal, LatticeECP2M, LatticeSC, PURESPEED, and specific product designations are either registered trademarks or trademarks of Lattice Semiconductor Corporation or its subsidiaries in the United States and/or other countries. HyperTransportTM is a licensed trademark of the HyperTransport Technology Consortium in the U.S. and other jurisdictions.

GENERAL NOTICE: Other product names used in this publication are for identification purposes only and may be trademarks of their respective holders.

                 Lattice Semiconductor Corporation
               Consolidated Statement of Operations
              (in thousands, except per share data)

                       Three months ended             Nine months ended
                ---------------------------------- -----------------------
                September      June     September   September   September
                    29,         30,         30,         29,         30,
Description        2007        2007        2006        2007        2006
-----------     ----------  ----------  ----------  ----------  ----------
                (unaudited)(unaudited) (unaudited) (unaudited) (unaudited)
Revenue         $   58,304  $   59,243  $   63,456  $  175,654  $  183,627

Costs and
 expenses (1):
  Cost of
   products
   sold             26,705      26,593      27,764      79,516      79,855
  Research and
   development      20,166      20,752      20,905      62,926      61,696
  Selling,
   general and
   administrative   15,054      14,785      15,207      44,405      43,490
  Amortization
   of
   intangible
   assets (2)        2,458       2,665       2,657       7,790       8,140
  Restructuring
   (3)               1,718          27         102       1,615         318
                ----------  ----------  ----------  ----------  ----------

Total costs and
 expenses           66,101      64,822      66,635     196,252     193,499
                ----------  ----------  ----------  ----------  ----------
Loss from
 operations         (7,797)     (5,579)     (3,179)    (20,598)     (9,872)

Other income,
 net (4)             3,551       4,299       4,324      10,858      12,721
                ----------  ----------  ----------  ----------  ----------

(Loss) income
 before
 provision for
 income taxes       (4,246)     (1,280)      1,145      (9,740)      2,849

Provision for
 income taxes          201         181         248         551         693
                ----------  ----------  ----------  ----------  ----------

Net (loss)
 income         $   (4,447) $   (1,461) $      897  $  (10,291) $    2,156
                ==========  ==========  ==========  ==========  ==========

Basic net
 (loss) income
 per share      $    (0.04) $    (0.01) $      .01  $    (0.09) $      .02
                ==========  ==========  ==========  ==========  ==========

Diluted net
 (loss) income
 per share      $    (0.04) $    (0.01) $      .01  $    (0.09) $      .02
                ==========  ==========  ==========  ----------  ==========

Shares used in
 per share
 calculations:
Basic              115,057     114,827     114,376     114,852     114,091
                ==========  ==========  ==========  ==========  ==========

Diluted (5)        115,057     114,827     115,560     114,852     114,577
                ==========  ==========  ==========  ==========  ==========

Notes:
(1) As a result of the restructuring implemented in the fourth quarter of
    2005, the Company realigned certain departments and job
    responsibilities in 2006.  Due to  these changes, the Company reviewed
    its historical cost center allocations and has reclassified these to
    reflect post-restructuring operations.  Amounts previously reported
    in the three and nine months ended September 30, 2006 have been
    reclassified to be consistent with the approach applied for the other
    periods presented.
(2) Intangible assets subject to amortization aggregate $7.9 million, net,
    at September 29, 2007 and relate to the acquisition of the FPGA
    business of Agere Systems, Inc. on January 18, 2002. Intangible assets
    related to the acquisition of Cerdelinx Technologies, Inc. became fully
    amortized in the third quarter of fiscal 2007. Amortization charges
    are expected to be substantially eliminated by the end of 2008.
(3) Represents costs and adjustments incurred under the corporate
    restructuring plans, implemented in the fourth quarter of 2005 and the
    third quarter of 2007. During the third quarter of  2007, we approved
    and initiated a restructuring plan ("2007 restructuring plan") to lower
    operating expenses. During the third quarter of 2007, we recorded an
     initial  restructuring  charge  of  $1.7  million  comprised  primarily  of
        severance  and  related  costs  of  which  $1.2  million  was  paid  during  the
        third  quarter  of    2007.  The  Company  expects  to  incur  an  additional
        charge  of  $1.5  million  to  $2.5  million  in  the  fourth  quarter  of  2007
        primarily  related  to  costs  to  vacate  leased  space.
(4)  Includes  a  $1.6  million  gain  recorded  during  the  three  months  ended
        June  30,  2007  as  a  result  of  the  Company  selling  a  parcel  of
        undeveloped  land  near  its  corporate  headquarters.
(5)  For  the  three  months  ended  September  29,  2007  and  June  30,  2007  and
        the  nine  months  ended  September  29,  2007,  the  computation  of  diluted
        earnings  per  share  excludes  the  effects  of  stock  options,  restricted
        stock  units,  warrants  and  Convertible  Notes,  as  they  are  antidilutive.
        For  the  three  and  nine  months  ended  September  30,  2006,  the
        computation  of  diluted  earnings  per  share  excludes  Convertible
        Notes,  as  they  are  antidillutive.


            Reconciliation  of  GAAP  Net  (Loss)  Income  to  Non-GAAP  Net  Income

                                                          (in  thousands)

                                              Three  Months  ended                          Nine  Months  ended
                              -----------  -----------  -----------  -----------    -----------
                              September                                  September    September        September
                                    29,                June  30,                30,              29,                      30,
                                  2007                  2007                    2006              2007                    2006
                              -----------  -----------  -----------  -----------    -----------
                              (unaudited)  (unaudited)  (unaudited)  (unaudited)    (unaudited)

GAAP  net  (loss)
  income                $        (4,447)$        (1,461)$              897  $      (10,291)  $          2,156
Reconciling
  items:
  Amortization
    of
    intangibles
    (1)                                2,458              2,665              2,657              7,790                8,140
  Stock-based
    compensation              1,349              1,325              1,117              4,063                2,462
  Restructuring
    (2)                                1,718                    27                  102              1,615                    318
                              -----------  -----------  -----------  -----------    -----------
Non-GAAP  net
  income                $          1,078  $          2,556  $          4,773  $          3,177    $        13,076
                              ===========  ===========  ===========  ===========    ===========



Reconciliation  of  GAAP  Net  (Loss)  Income  per  Share  to  Non-GAAP  Net  Income
per  Share


                                              Three  Months  ended                          Nine  Months  ended
                              -----------  -----------  -----------  -----------    -----------
                                September                              September      September        September
                                      29,              June  30,            30,                  29,                    30,
                                    2007                2007                2006                2007                  2006
                              -----------  -----------  -----------  -----------    -----------
                              (unaudited)  (unaudited)  (unaudited)  (unaudited)    (unaudited)
Basic  and
  Diluted  (4):
GAAP  net
  (loss)  income          $  (0.04)        $  (0.01)  $          0.01  $          (0.09)  $          0.02
Reconciling
  items:
    Amortization
      of
      intangibles
      (1)                                0.02                0.02                0.02                0.07                0.07
    Stock-based
      compensation              0.01                0.01                0.01                0.04                0.02
    Restructuring
      (2)                                0.01                0.00                0.00                0.01                0.00
                              -----------  -----------  -----------  -----------  -----------
Non-GAAP  net
  income                $            0.01  $            0.02  $            0.04  $            0.03  $            0.11
                              ===========  ===========  ===========  ===========  ===========
Shares  used  in
  per  share
  calculations:
    Basic                        115,057          114,827          114,376          114,852          114,091
                              ===========  ===========  ===========  ===========  ===========
    Diluted  (3)            120,659          122,611          125,385          122,462          124,816
                              ===========  ===========  ===========  ===========  ===========

Notes:
(1)    Intangible  assets  subject  to  amortization  aggregate  $7.9  million,  net,
          at  September  29,  2007  and  relate  to  the  acquisition  of  the  FPGA
          business  of  Agere  Systems,  Inc.,  on  January  18,  2002.  Intangible
          assets  related  to  the  acquisition  of  Cerdelinx  Technologies,  Inc.
          became  fully  amortized  in  the  third  quarter  of  fiscal  2007.
          Amortization  charges  are  expected  to  be  substantially  eliminated
          by  the  end  of  2008.
(2)    Represents  costs  and  adjustments  incurred  under  the  corporate
          restructuring  plans,  implemented  in  the  fourth  quarter  of  2005  and  the
          third  quarter  of  2007.  During  the  third  quarter  of  2007,  we  approved
          and  initiated  a  restructuring  plan  ("2007  restructuring  plan")  to
          lower  operating  expenses.  During  the  third  quarter  of  2007,  we
          recorded  an  initial  restructuring  charge  of  $1.7  million  comprised
          primarily  of  severance  and  related  costs  of  which  $1.2  million  was
          paid  during  the  third  quarter  of  2007.  The  Company  expects  to  incur  an
          additional  charge  of  $1.5  million  to  $2.0  million  in  the  fourth
          quarter  of  2007  primarily  related  to  costs  to  vacate  leased  space.
(3)    For  all  periods  presented  the  effects  of  stock  options,  restricted
          stock  units  and  convertible  notes  are  included  as  they  are  dilutive.
(4)    Per  share  amounts  may  differ  due  to  rounding.



                                              Lattice  Semiconductor  Corporation

                                                    Consolidated  Balance  Sheet

                                                                (in  thousands)

Description                                                                                          September  December
-----------                                                                                                  29,            30,
                                                                                                                      2007          2006
                                                                                                                ---------  ---------
                                                                                                                (unaudited)

                                            Assets
Current  assets:
    Cash  and  short-term  investments                                              $  128,364  $  233,208
    Accounts  receivable,  net                                                                  31,097        22,545
    Inventories                                                                                            36,677        38,816
    Other  current  assets                                                                          35,111        35,474
                                                                                                                ---------  ---------
        Total  current  assets                                                                    231,249      330,043

Property  and  equipment,  net                                                                44,813        46,696
Foundry  investments,  advances  and  other  assets                          93,909      109,964
Goodwill  and  other  intangible  assets,  net  (1)                          231,412      239,203
                                                                                                                ---------  ---------

                                                                                                                $  601,383  $  725,906
                                                                                                                =========  =========

                        Liabilities  and  Stockholders'  Equity

Current  liabilities:
    Accounts  payable  and  other  accrued  liabilities                $    33,114  $    82,843
    Deferred  income  and  allowances  on  sales  to
      distributors                                                                                          7,042          6,230
    Zero  Coupon  Convertible  Notes  due  in  2010  (2)                        40,000        20,480
                                                                                                                ---------  ---------
        Total  current  liabilities                                                            80,156      109,553

Zero  Coupon  Convertible  Notes  due  in  2010  (2)                                      -        89,120
Other  long-term  liabilities                                                                  6,031        15,488
                                                                                                                ---------  ---------
        Total  liabilities                                                                            86,187      214,161

Stockholders'  equity                                                                            515,196      511,745
                                                                                                                ---------  ---------

                                                                                                                $  601,383  $  725,906
                                                                                                                =========  =========

        Notes:

(1)  At  September  29,  2007,  includes  approximately  $223.6  million  in
        goodwill  and  $7.9  million  of  other  intangible  assets,  net,  related  to
        the  acquisition  of  the  FPGA  business  of  Agere  Systems,  Inc.  Goodwill  is
        not  amortized  effective  with  the  March  2002  quarter.

(2)  Effective  July  1,  2007,  the  Convertible  Notes  were  classified  as  a
        current  liability  as  the  holders  of  the  Convertible  Notes  have  a  right
        to  require  payment  of  the  Convertible  Notes  on  July  1,  2008.    At
        December  30,  2006,  $20.5  million  of  Convertible  Notes  were  classified
        as  a  current  liability  because  it  was  known  at  the  time  of  filing  our
        financial  statements  this  amount  would  be  extinguished  in  the  first
        quarter  of  fiscal  2007.




                                              Lattice  Semiconductor  Corporation

                                  -  Supplemental  Historic  Financial  Information  -



Operations  Information                                              Q307              Q207              Q306
                                                                                      ---------    ---------    ---------
Percent  of  Revenue  (1):
Gross  Margin                                                                  54.2%            55.1%            56.2%
R&D  Expense                                                                    34.6%            35.0%            32.9%
SG&A  Expense                                                                  25.8%            25.0%            24.0%


Depreciation  Expense  ($000)                                  3,398            3,396            3,151
Capital  Expenditures  ($000)                                  2,110            2,914            2,728

Balance  Sheet  Information
Current  Ratio                                                                  2.9                5.9                5.9
A/R  Days  Revenue  Outstanding                                      49                  46                  33
Inventory  Months                                                            4.1                4.3                4.0

Revenue%  (by  Product  Family)
FPGA                                                                                      23%                23%                21%
PLD                                                                                        77%                77%                79%

Revenue%  (by  Product  Classification)
New                                                                                        14%                11%                  8%
Mainstream                                                                          53%                50%                49%
Mature                                                                                  33%                39%                43%

Revenue%  (by  Geography)
Americas                                                                              21%                24%                25%
Europe  (incl.  Africa)                                                    20%                18%                21%
Asia                                                                                      59%                58%                54%

Revenue%  (by  End  Market)
Communications                                                                  54%                52%                52%
Industrial  &  Other                                                          24%                24%                22%
Consumer  &  Automotive                                                    11%                13%                11%
Computing                                                                            11%                11%                15%

Revenue%  (by  Channel)
Direct                                                                                  66%                64%                64%
Distribution                                                                      34%                36%                36%


New:                        LatticeSC,  LatticeECP2/M,  LatticeECP,  LatticeXP,  MachXO,
                                Power  Manager,  ispClock

Mainstream:          FPSC,  XPLD,  ispGDX2,  ispMACH  4/LV,  ispGDX/V,  ispMACH
                                4000/Z,  XPGA,  Software  and  IP

Mature:                  ORCA  2,  ORCA  3,  ORCA  4,  ispPAC,  ispLSI  8000V,  ispMACH
                                5000B,  ispMACH  2LV,  ispMACH  5LV,  ispLSI  2000V,  ispLSI
                                5000V,  ispMACH  5000VG,  all  5  Volt  CPLDs,  all  SPLDs

        Note:
(1)  Q306  amounts  have  been  reclassified  to  be  consistent  with  the  current
        period.



 




« Previous Page 1 | 2             



© 2024 Internet Business Systems, Inc.
670 Aberdeen Way, Milpitas, CA 95035
+1 (408) 882-6554 — Contact Us
ShareCG™ is a trademark of Internet Business Systems, Inc.

Report a Bug Report Abuse Make a Suggestion About Privacy Policy Contact Us User Agreement Advertise