Microchip Technology Announces Record Net Sales and Fourth Quarter and Fiscal Year 2013 Financial Results



  • FOR FISCAL YEAR 2013:
    • RECORD NON-GAAP NET SALES OF $1.606 BILLION
    • RECORD GAAP NET SALES OF $1.582 BILLION
    • ON A NON-GAAP BASIS:
      • GROSS MARGIN OF 57.2%; OPERATING INCOME OF $459.5 MILLION; NET INCOME OF $388.5 MILLION AND 24.2% OF NET SALES; EPS OF $1.89 PER DILUTED SHARE
    • ON A GAAP BASIS:
      • NET GROSS MARGIN OF 53%; OPERATING INCOME OF $178.6 MILLION; NET INCOME OF $127.4 MILLION AND 8.1% OF NET SALES; EPS OF 62 CENTS PER DILUTED SHARE
  • FOR THE QUARTER ENDING MARCH 31, 2013:
    • RECORD NET SALES OF $430.1 MILLION ON BOTH A NON-GAAP AND GAAP BASIS
    • ON A NON-GAAP BASIS: GROSS MARGINS OF 56.4%; OPERATING INCOME OF $119.5 MILLION; NET INCOME OF $109.3 MILLION; AND EPS OF 52 CENTS PER DILUTED SHARE INCLUDING A 3 CENTS BENEFIT FROM THE RETROACTIVE REINSTATEMENT OF THE R&D TAX CREDIT. THE FIRST CALL PUBLISHED ESTIMATE FOR NON-GAAP EPS WAS 47 CENTS.
    • ON A GAAP BASIS: GROSS MARGINS OF 55.6%; OPERATING INCOME OF $56.7 MILLION; NET INCOME OF $59.7 MILLION; AND EPS OF 28 CENTS PER DILUTED SHARE INCLUDING A 3 CENTS BENEFIT FROM THE RETROACTIVE REINSTATEMENT OF THE R&D TAX CREDIT. THERE WAS NO PUBLISHED FIRST CALL ESTIMATE FOR GAAP EPS.
    • RECORD NET SALES FOR OVERALL MICROCONTROLLERS, 16-BIT MICROCONTROLLERS AND ANALOG PRODUCTS
    • LICENSING NET SALES OF $22.1 MILLION, UP 3.4% SEQUENTIALLY

Microchip Technology Incorporated (NASDAQ: MCHP), a leading provider of microcontroller, mixed-signal, analog and Flash-IP solutions, today reported results for the three months and fiscal year ended March 31, 2013 as summarized in the following table:

Three Months Ended March 31, 2013       Year Ended March 31, 2013  
(in millions, except earnings per diluted share and percentages)      

 

GAAP

   

% of
Net Sales

   

Non-
GAAP1

   

% of
Net Sales

     

 

GAAP

   

% of
Net Sales

   

Non-
GAAP1

   

% of
Net Sales

 
Net Sales       $ 430.1             $ 430.1             $ 1,581.6           $ 1,606.4        
Gross Margin       $ 239.0       55.6 %     $ 242.6     56.4 %       $ 838.5     53.0 %     $ 918.6     57.2 %  
Operating Income       $ 56.7       13.2 %     $ 119.5     27.8 %       $ 178.6     11.3 %     $ 459.5     28.6 %  

Other Expense including Gains/Losses on Equity Method Investments

     

$

7.2

           

$

5.1

           

$

26.4

         

$

18.2

       
Income Tax (Benefit) Expense      

($

10.2

)

         

$

5.1

           

$

24.8

         

$

52.9

       
Net Income      

$

59.7

     

13.9

%

   

$

109.3

   

25.4

%

     

$

127.4

   

8.1

%

   

$

388.5

   

24.2

%

 
Earnings per Diluted Share2        

28 cents

             

52 cents

             

62 cents

         

$

1.89

       

¹

 

See the “Use of Non-GAAP Financial Measures” section of this release.

Consolidated net sales for the fourth quarter of fiscal year 2013 were $430.1 million, up 3.4% sequentially from net sales of $416.0 million in the immediately preceding quarter, and up 26.9% from net sales of $338.9 million in the prior year’s fourth quarter. Consolidated GAAP net income for the fourth quarter of fiscal year 2013 was $59.7 million, or 28 cents per diluted share, up 486.7% from GAAP net income of $10.2 million, or 5 cents per diluted share, in the immediately preceding quarter, and down 26.0% from GAAP net income of $80.6 million, or 39 cents per diluted share, in the prior year’s fourth quarter. In the fourth quarter of fiscal 2013, GAAP net income includes amortization of acquired intangibles of $39.9 million, special charges of $7.2 million and various non-recurring tax benefits of $9.5 million. In the fourth quarter of fiscal 2012, GAAP net income includes amortization of acquired intangibles of $2.8 million and special charges of $1.5 million.

Consolidated non-GAAP net income for the fourth quarter of fiscal year 2013 was $109.3 million, or 52 cents per diluted share, up 29.3% from non-GAAP net income of $84.5 million, or 41 cents per diluted share, in the immediately preceding quarter, and up 15.9% from non-GAAP net income of $94.3 million, or 46 cents per diluted share, in the prior year’s fourth quarter. Fourth quarter GAAP and non-GAAP net income included a one-time tax benefit of $6.5 million for the retroactive reinstatement of the R&D tax credit for calendar year 2012. Additionally, for the fourth quarters of fiscal 2013 and fiscal 2012, our non-GAAP results exclude the effect of share-based compensation, expenses related to our acquisition activities (including intangible asset amortization, inventory valuation costs, severance costs, earn out adjustments and legal and other general and administrative expenses associated with acquisitions), non-recurring tax events and non-cash interest expense on our convertible debentures. A reconciliation of our non-GAAP and GAAP results is included in this press release.

Consolidated GAAP net sales for the fiscal year ended March 31, 2013 were $1.582 billion, an increase of 14.4% from net sales of $1.383 billion in the prior fiscal year. On a GAAP basis, consolidated net income for the fiscal year ended March 31, 2013 was $127.4 million, or 62 cents per diluted share, a decrease of 62.2% from net income of $336.7 million, or $1.65 per diluted share in the prior fiscal year.

On a non-GAAP basis, consolidated net sales for the fiscal year ended March 31, 2013 were $1.606 billion, an increase of 16.1% from net sales of $1.383 billion in the prior fiscal year. Non-GAAP consolidated net income for the fiscal year ended March 31, 2013 was $388.5 million, or $1.89 per diluted share, an increase of 1.2% from net income of $383.7 million, or $1.89 per diluted share, in the prior fiscal year.

Microchip also announced today that its Board of Directors declared a quarterly cash dividend on its common stock of 35.35 cents per share. The quarterly dividend is payable on June 4, 2013 to stockholders of record on May 21, 2013.

“We were very pleased with our execution in the March quarter,” said Steve Sanghi, President and CEO. “Our net sales were above the midpoint of our guidance and our gross margin, operating income and earnings per share all exceeded the high end of our guidance, as we more than delivered on our expectation that the December quarter would mark the bottom for this cycle.”

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Contact Information

Microchip Technology Inc.

2355 W. Chandler Blvd.
Chandler, AZ, 85224
USA

tele: 480.792.7200
toll-free: 888.MCU.MCHP
fax: 480.792.7277
here2help@microchip.com
www.microchip.com

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