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Cirrus Logic Reports Q4 Revenue Of $232 Million And Record Revenue Of $1.2 Billion For Fy16

The following excerpt is from the company's SEC filing.

Anticipates Strong Annual Revenue Growth in FY17 Fueled by Portable Audio Products

a leader in high-precision analog and digital signal processing products, 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 2016, which ended Mar. 26, 2016, as well as the company’s current business outlook.

“ FY16 was an outstanding year for Cirrus Logic as we delivered record revenue of $1.2 billion, up 28 percent from the prior year. Additionally, the company is positioned to exceed our long-term revenue growth model again in FY17,” said Jason Rhode, president and chief executive officer. “Demand for our products continues to gain momentum as our customers push to further differentiate their devices with compelling and consistent audio and voice capabilities. With a robust portfolio of components and an extensive roadmap the company is well positioned to capitalize on the rapidly growing markets for audio and voice in FY17 and beyond.”

Reported Financial Results – Fourth Quarter FY16

Revenue of $232 million;

GAAP gross margin of 49.7 percent and non-GAAP gross margin of 49.8 percent;

GAAP operating expenses of $93.1 million; non-GAAP operating expenses of $79.7 million; and

GAAP diluted earnings per share of $0.21 and non-GAAP diluted earnings per share of $0.38.

Reported Financial Results – Full Year FY16

Revenue of $1.2 billion;

GAAP gross margin of 47.5 percent and non-GAAP gross margin of 47.6 percent;

GAAP operating expenses of $374.6 million; non-GAAP operating expenses of $325.3 million; and

GAAP diluted earnings per share of $1.87 and non-GAAP diluted earnings per share of $2.40.

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

Business Outlook – First Quarter FY17

Revenue is expected to range between $220 million and $250 million;

GAAP gross margin is expected to be between 47 percent and 49 percent; and

Combined GAAP R&D and SG&A expenses are expected to range between $103 million and $107 million, which includes approximately $9 million in share-based compensation and $9 million in 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: 77072356).

Cirrus Logic is a leader in high performance, low-power ICs for audio and voice signal processing applications. Cirrus Logic’s products span the entire audio signal chain, from capture to playback, providing innovative products for the world’s top smartphones, tablets, digital headsets, wearables and emerging smart home applications. With headquarters in Austin, Texas, Cirrus Logic is recognized globally for its award-winning corporate culture. Check us out 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 gross margins, operating expenses, net income, operating profit and income, tax expenses 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 future growth opportunities and our estimates of first quarter fiscal year 2017 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 2017, customer cancellations of orders, or the failure to place orders consistent with forecasts, along with the timing and success of future product ramps; and the risk factors listed in our Form 10-K for the year ended March 28, 2015, and in our other filings with the Securities and Exchange Commission, which are available at

. 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 and Cirrus are registered trademarks of Cirrus Logic, Inc. All other company or product names noted herein may be trademarks of their respective holders.

CIRRUS LOGIC, INC.

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS

(unaudited)

(in thousands, except per share data)

Three Months Ended

Twelve Months Ended

Dec. 26,

Mar. 28,

Portable audio products

187,280

308,803

210,814

989,101

740,302

Non-portable audio and other products

44,719

39,060

44,369

180,150

176,266

Net sales

231,999

347,863

255,183

1,169,251

916,568

Cost of sales

116,745

182,952

136,208

614,411

490,820

Gross profit

115,254

164,911

118,975

554,840

425,748

Gross margin

Research and development

65,834

70,290

58,070

269,217

197,878

Selling, general and administrative

27,228

30,632

30,498

117,082

99,509

Acquisition related costs

18,137

Restructuring and other

1,455

Patent agreement and other

78

(11,670

Total operating expenses

93,062

101,000

88,568

374,629

316,979

Income from operations

22,192

63,911

30,407

180,211

108,769

Interest expense, net

(601

(591

(869

(2,431

(5,048

Other income (expense), net

(478

(925

392

(1,791

(12,172

Income before income taxes

21,113

62,395

29,930

175,989

91,549

Provision for income taxes

7,101

21,011

8,581

52,359

36,371

Net income

14,012

41,384

21,349

123,630

55,178

Basic earnings per share:

0.22

0.65

0.34

1.96

0.88

Diluted earnings per share:

0.21

0.63

0.32

1.87

0.85

Weighted average number of shares:

Basic

62,843

63,328

62,852

63,197

62,503

Diluted

65,398

65,761

65,815

65,993

65,235

Prepared in accordance with Generally Accepted Accounting Principles

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.

Net Income Reconciliation

GAAP Net Income

Amortization of acquisition intangibles

8,363

8,634

7,141

32,271

15,062

Stock based compensation expense

8,858

7,761

7,735

33,578

27,668

Restructuring and other costs, net

(3,667

Wolfson acquisition items

43,082

Adjustment to income taxes

(2,658

(3,737

7,230

(16,062

31,934

Non-GAAP Net Income

24,908

54,120

43,455

158,080

174,379

Earnings Per Share Reconciliation

GAAP Diluted earnings per share

Effect of Amortization of acquisition intangibles

0.13

0.11

0.49

0.23

Effect of Stock based compensation expense

0.14

0.12

0.51

0.42

Effect of Patent agreement and other

(0.18

Effect of Restructuring and other costs, net

(0.06

(0.05

0.02

Effect of Wolfson acquisition items

0.66

Effect of Adjustment to income taxes

(0.04

(0.24

Non-GAAP Diluted earnings per share

Operating Income Reconciliation

GAAP Operating Income

GAAP Operating Profit

Stock compensation expense - COGS

233

213

(10

1,151

747

Stock compensation expense - R&D

4,996

4,183

2,994

17,173

11,222

Stock compensation expense - SG&A

3,629

3,365

4,751

15,254

15,699

28,642

Non-GAAP Operating Income

35,746

80,384

45,283

230,723

181,596

Non-GAAP Operating Profit

Operating Expense Reconciliation

GAAP Operating Expenses

(8,363

(8,634

(7,141

(32,271

(15,062

(4,996

(4,183

(2,994

(17,173

(11,222

(3,629

(3,365

(4,751

(15,254

(15,699

(78

11,670

3,667

(1,455

(20,329

Non-GAAP Operating Expenses

79,741

84,740

73,682

325,268

253,212

Gross Margin/Profit Reconciliation

GAAP Gross Margin

GAAP Gross Profit

8,313

Non-GAAP Gross Margin

115,487

165,124

118,965

555,991

434,808

Non-GAAP Gross Profit

Effective Tax Rate Reconciliation

GAAP Tax Expense

GAAP Effective Tax Rate

Adjustments to income taxes

2,658

3,737

(7,230

16,062

(31,934

Non-GAAP Tax Expense

24,748

68,421

Non-GAAP Effective Tax Rate

Tax Impact to EPS Reconciliation

0.04

0.06

(0.11

0.24

(0.49

CONSOLIDATED CONDENSED BALANCE SHEET

unaudited; in thousands

ASSETS

Current assets

Cash and cash equivalents

168,793

159,572

76,401

Marketable securities

60,582

67,148

124,246

Accounts receivable, net

88,532

127,754

112,608

Inventories

142,015

137,723

84,196

Deferred tax asset

19,404

18,559

Other current assets

46,207

37,982

35,903

Total current Assets

506,129

549,583

451,913

Long-term marketable securities

20,631

22,327

60,072

Property and equipment, net

162,656

159,149

144,346

Intangibles, net

162,832

171,664

175,743

Goodwill

287,518

263,115

25,772

27,581

25,593

Other assets

16,345

18,099

27,996

Total assets

1,181,883

1,235,921

1,148,778

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Accounts payable

71,619

114,483

112,213

Accrued salaries and benefits

21,239

22,438

24,132

Deferred income

4,162

6,105

Other accrued liabilities

35,266

36,301

34,128

Total current liabilities

128,124

177,384

176,578

Long-term debt

160,439

180,439

Other long-term liabilities

33,837

38,223

34,990

Stockholders' equity:

Capital stock

1,203,496

1,198,547

1,159,494

Accumulated deficit

(344,345

(336,653

(400,613

Accumulated other comprehensive income (loss)

332

(2,019

(2,110

Total stockholders' equity

859,483

859,875

756,771

Total liabilities and stockholders' equity

CONTACT:

Thurman K. Case, 512-851-4125

Chief Financial Officer

Investor.Relations@cirrus.com

The above information was disclosed in a filing to the SEC. To see the filing, click here.

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Other recent filings from the company include the following:

Cirrus Logic director just disposed of 270 shares - April 5, 2016