NASDAQ: CRUS

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Sep 02, 2014 03:59 PM Pricing delayed 20 minutes

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Sep 02, 2014 03:59 PM Pricing delayed 20 minutes
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Cirrus Logic Reports Q4 Revenue of $149.7 Million and Full FY14 Revenue of $714.3 Million

04/24/2014

Delivers Annual Operating Profit of 22 Percent GAAP and 25 Percent Non-GAAP

AUSTIN, Texas--(BUSINESS WIRE)-- Cirrus Logic, Inc. (Nasdaq: CRUS), a leader in high-precision analog and digital signal processing components, today posted on its investor relations website at http://investor.cirrus.com the quarterly Shareholder Letter that contains the complete financial results for the fourth quarter and full fiscal year 2014, which ended March 29, as well as the company’s current business outlook.

“Cirrus Logic is entering into FY15 with a robust pipeline of innovative products, a compelling roadmap pairing our best in class hardware with embedded SoundClear® software and solid relationships with leading players in our target markets,” said Jason Rhode, president and chief executive officer. “Many of our new developments are now under way in more advanced process geometries, allowing our engineers to add meaningful signal processing capabilities to our products and significantly enhance the value we add for our customers.”

Reported Financial Results – Fourth Quarter FY14

  • Revenue of $149.7 million;
  • Gross margin of 49 percent;
  • GAAP operating expenses of $53.3 million and non-GAAP operating expenses of $47.9 million; and
  • GAAP diluted earnings per share of $0.20 and non-GAAP diluted earnings per share of $0.41.

Reported Financial Results – Complete FY14

  • Revenue of $714.3 million;
  • Gross margin of 50 percent;
  • GAAP operating expenses of $201.1 million and non-GAAP operating expenses of $178.3 million; and
  • GAAP diluted earnings per share of $1.65 and non-GAAP diluted earnings per share of $2.69.

A reconciliation of the non-GAAP charges is included in the tables accompanying this press release.

Business Outlook – First Quarter FY15

  • Revenue is expected to range between $135 million and $155 million;
  • Gross margin is expected to be between 47 percent and 49 percent; and
  • Combined R&D and SG&A expenses are expected to range between $57 million and $62 million, which includes approximately $7 million in share-based compensation and amortization of acquired intangibles.

Cirrus Logic will host a live Q&A session at 5 p.m. EDT today to answer questions related to its financial results and business outlook. Participants may listen to the conference call on the Cirrus Logic website. Participants who would like to submit a question to be addressed during the call are requested to email investor.relations@cirrus.com. A replay of the webcast can be accessed on the Cirrus Logic website approximately two hours following its completion, or by calling (404) 537-3406, or toll-free at (855) 859-2056 (Access Code: 23057089).

Upcoming Investor Conference

Cirrus Logic CEO Jason Rhode will present at the Jefferies 2014 Global Technology, Media and Telecom Conference in Miami on May 6 at 12:00 pm EDT. A live webcast of the presentation will be available on the company's investor relations website http://investor.cirrus.com. An archived replay of the webcast will be available for 90 days on the website following the event.

Cirrus Logic, Inc.

Cirrus Logic develops high-precision, analog and mixed-signal integrated circuits for a broad range of innovative customers. Building on its diverse analog and signal-processing patent portfolio, Cirrus Logic delivers highly optimized products for a variety of audio and energy-related applications. The company operates from headquarters in Austin, Texas, with offices in Phoenix, Ariz., Europe, Japan and Asia. More information about Cirrus Logic is available at www.cirrus.com.

Use of non-GAAP Financial Information

To supplement Cirrus Logic's financial statements presented on a GAAP basis, Cirrus has provided non-GAAP financial information, including operating expenses, net income, operating profit and diluted earnings per share. A reconciliation of the adjustments to GAAP results is included in the tables below. Non-GAAP financial information is not meant as a substitute for GAAP results, but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. The non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.

Safe Harbor Statement

Except for historical information contained herein, the matters set forth in this news release contain forward-looking statements, including our estimates of first quarter fiscal year 2015 revenue, gross margin, combined research and development and selling, general and administrative expense levels, share-based compensation expense and amortization of acquired intangibles. In some cases, forward-looking statements are identified by words such as “expect,” “anticipate,” “target,” “project,” “believe,” “goals,” “opportunity,” “estimates,” “intend,” and variations of these types of words and similar expressions. In addition, any statements that refer to our plans, expectations, strategies or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and assumptions and are subject to certain risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include, but are not limited to, the following: the level of orders and shipments during the first quarter of fiscal year 2015, as well as customer cancellations of orders, or the failure to place orders consistent with forecasts; and the risk factors listed in our Form 10-K for the year ended March 30, 2013, and in our other filings with the Securities and Exchange Commission, which are available at www.sec.gov. The foregoing information concerning our business outlook represents our outlook as of the date of this news release, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.

Cirrus Logic, Cirrus and SoundClear are registered trademarks of Cirrus Logic, Inc.

Summary financial data follows:

           
 
CIRRUS LOGIC, INC.
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(unaudited)
(in thousands, except per share data)
 
Three Months Ended Twelve Months Ended
Mar. 29, Dec. 28, Mar. 30, Mar. 29, Mar. 30,
2014 2013 2013 2014 2013
Q4'14 Q3'14 Q4'13 Q4'14 Q4'13
Audio products $ 137,773 $ 206,388 $ 196,098 $ 667,739 $ 754,769
Energy products   11,886     12,495     10,775     46,599     55,017  
Net revenue   149,659     218,883     206,873     714,338     809,786  
Cost of sales   76,291     115,034     123,259     358,175     414,595  
Gross Profit 73,368 103,849 83,614 356,163 395,191
Gross Margin 49.0 % 47.4 % 40.4 % 49.9 % 48.8 %
 
Research and development 35,511 32,426 30,085 126,189 114,071
Selling, general and administrative 17,823 18,625 19,724 74,861 76,998
Restructuring and other costs (26 ) 12 - (598 ) 3,539
Gain on sale of asset - - - - (247 )
Patent settlements, net   -     -     -     695     -  
Total operating expenses   53,308     51,063     49,809     201,147     194,361  
 
Operating income 20,060 52,786 33,805 155,016 200,830
 
Interest income, net 267 222 106 848 440
Other income (expense), net   (27 )   (45 )   14     (127 )   (80 )
Income before income taxes 20,300 52,963 33,925 155,737 201,190
Provision for income taxes   7,698     11,463     7,565     47,626     64,592  
Net income $ 12,602   $ 41,500   $ 26,360   $ 108,111   $ 136,598  
 
Basic earnings per share: $ 0.20 $ 0.66 $ 0.41 $ 1.72 $ 2.12
Diluted earnings per share: $ 0.20 $ 0.63 $ 0.39 $ 1.65 $ 2.00
 
Weighted average number of shares:
Basic 62,215 62,854 63,877 62,926 64,580
Diluted 64,545 65,368 67,138 65,535 68,454
 
Prepared in accordance with Generally Accepted Accounting Principles

 
 
CIRRUS LOGIC, INC.
RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(unaudited, in thousands, except per share data)
(not prepared in accordance with GAAP)
 
Non-GAAP financial information is not meant as a substitute for GAAP results, but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. As a note, the non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP. Certain modifications to prior year non-GAAP presentation has been made and had no material effect on the results of operations.
     
Three Months Ended Twelve Months Ended
Mar. 29,   Dec. 28,   Mar. 30, Mar. 29,   Mar. 30,
2014 2013 2013 2014 2013
Net Income Reconciliation Q4'14 Q3'14 Q4'13 Q4'14 Q4'13
GAAP Net Income $ 12,602 $ 41,500 $ 26,360 $ 108,111 $ 136,598
Amortization of acquisition intangibles 217 275 - 492 604
Stock based compensation expense 5,545 6,016 5,734 23,074 21,496
International sales reorganization charges - - 442 - 395
Restructuring and other costs, net (26 ) 12 - (598 ) 3,539
Gain on asset sale - - - - (247 )
Patent settlements, net - - - 695 -
Provision for income taxes   7,808     10,300     7,041     44,647     59,643  
Non-GAAP Net Income $ 26,146   $ 58,103   $ 39,577   $ 176,421   $ 222,028  
 
Earnings Per Share Reconciliation
GAAP Diluted earnings per share $ 0.20 $ 0.63 $ 0.39 $ 1.65 $ 2.00
Effect of Amortization of acquisition intangibles - - - 0.01 0.01
Effect of Stock based compensation expense 0.09 0.10 0.09 0.35 0.31
Effect of International sales reorganization charges - - 0.01 - -
Effect of Restructuring and other costs, net - - - (0.01 ) 0.05
Effect of Patent settlements, net - - - 0.01 -
Effect of Provision for income taxes   0.12     0.16     0.10     0.68     0.87  
Non-GAAP Diluted earnings per share $ 0.41   $ 0.89   $ 0.59   $ 2.69   $ 3.24  
 
Operating Income Reconciliation
GAAP Operating Income $ 20,060 $ 52,786 $ 33,805 $ 155,016 $ 200,830
GAAP Operating Profit 13 % 24 % 16 % 22 % 25 %
Amortization of acquisition intangibles 217 275 - 492 604
Stock compensation expense - COGS 287 332 296 864 751
Stock compensation expense - R&D 2,546 2,834 2,976 10,392 10,550
Stock compensation expense - SG&A 2,712 2,850 2,462 11,818 10,195
International sales reorganization charges - - 442 - 395
Restructuring and other costs, net (26 ) 12 - (598 ) 3,539
Gain on asset sale - - - - (247 )
Patent settlements, net   -     -     -     695     -  
Non-GAAP Operating Income $ 25,796   $ 59,089   $ 39,981   $ 178,679   $ 226,617  
Non-GAAP Operating Profit 17 % 27 % 19 % 25 % 28 %
 
Operating Expense Reconciliation
GAAP Operating Expenses $ 53,308 $ 51,063 $ 49,809 $ 201,147 $ 194,361
Amortization of acquisition intangibles (217 ) (275 ) - (492 ) (604 )
Stock compensation expense - R&D (2,546 ) (2,834 ) (2,976 ) (10,392 ) (10,550 )
Stock compensation expense - SG&A (2,712 ) (2,850 ) (2,462 ) (11,818 ) (10,195 )
International sales reorganization charges - - (442 ) - (395 )
Restructuring and other costs, net 26 (12 ) - 598 (3,539 )
Gain on asset sale - - - - 247
Patent settlements, net   -     -     -     (695 )   -  
Non-GAAP Operating Expenses $ 47,859   $ 45,092   $ 43,929   $ 178,348   $ 169,325  

       
 
CIRRUS LOGIC, INC.
CONSOLIDATED CONDENSED BALANCE SHEET
unaudited; in thousands
 
Mar. 29, Dec. 28, Mar. 30,
2014 2013 2013
ASSETS
Current assets
Cash and cash equivalents $ 31,850 $ 74,690 $ 66,402
Restricted investments - - -
Marketable securities 263,417 215,792 105,235
Accounts receivable, net 63,220 109,535 69,289
Inventories 69,743 69,985 119,300
Deferred tax asset 22,024 33,155 64,937
Other current assets   25,079     25,662     19,371  
Total Current Assets 475,333 528,819 444,534
 
Long-term marketable securities 89,243 37,115 64,910
Property and equipment, net 103,650 102,542 100,623
Intangibles, net 11,999 13,427 4,650
Goodwill 16,367 16,335 6,027
Deferred tax asset 25,065 17,354 16,671
Other assets   3,087     6,848     13,932  
Total Assets $ 724,744   $ 722,440   $ 651,347  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 51,932 $ 60,493 $ 60,827
Accrued salaries and benefits 13,388 13,937 16,592
Other accrued liabilities 11,572 12,881 10,704
Deferred income on shipments to distributors   5,631     4,998     4,956  
Total Current Liabilities 82,523 92,309 93,079
 
Other long-term obligations 4,863 5,108 10,094
 
Stockholders' equity:
Capital stock 1,078,878 1,069,113 1,041,834
Accumulated deficit (440,634 ) (443,322 ) (492,741 )
Accumulated other comprehensive loss   (886 )   (768 )   (919 )
Total Stockholders' Equity   637,358     625,023     548,174  
Total Liabilities and Stockholders' Equity $ 724,744   $ 722,440   $ 651,347  
 
Prepared in accordance with Generally Accepted Accounting Principles

Source: Cirrus Logic, Inc.

Cirrus Logic, Inc.

Thurman K. Case, 512-851-4125

Chief Financial Officer

Investor.Relations@cirrus.com