This press release includes "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about our plans, objectives, representations and contentions and are not historical facts and typically are identified by use of terms such as "may," "will," "should," "could," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue" and similar words, although some forward-looking statements are expressed differently. You should be aware that the forward-looking statements included herein represent management's current judgment and expectations, but our actual results, events and performance could differ materially from those expressed or implied by forward-looking statements. We do not intend to update any of these forward-looking statements or publicly announce the results of any revisions to these forward-looking statements, other than as is required under the federal securities laws. RF Micro Devices' business is subject to numerous risks and uncertainties, including variability in quarterly operating results, the rate of growth and development of wireless markets, risks associated with the operation of our wafer fabrication facilities, molecular beam epitaxy facility, our assembly facility and our test, tape and reel facilities, our ability to attract and retain skilled personnel and develop leaders, variability in production yields, our ability to reduce costs and improve gross margins by implementing innovative technologies, our ability to bring new products to market, our ability to adjust production capacity in a timely fashion in response to changes in demand for our products, dependence on a limited number of customers and dependence on third parties. These and other risks and uncertainties, which are described in more detail in RF Micro Devices' most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, could cause actual results and developments to be materially different from those expressed or implied by any of these forward- looking statements.
RF MICRO DEVICES(R), RFMD(R) and POLARIS(TM) TOTAL RADIO(TM) are trademarks of RFMD, LLC. BLUETOOTH is a trademark owned by Bluetooth SIG, Inc., U.S.A. and licensed for use by RF Micro Devices, Inc. All other trade names, trademarks
and registered trademarks are the property of their respective owners.
RF MICRO DEVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
September 30, September 30,
2005 2004 2005 2004
Total revenue $ 177,003 $ 149,107 $ 336,388 $314,881
Costs and expenses:
Cost of goods sold 113,255 100,040 218,329 200,927
Research and development 39,461 37,143 78,174 72,489
Marketing and selling 12,079 11,407 24,135 22,539
General and
administrative 6,497 5,338 13,165 11,174
Other operating expense
(income) 166 453 (684) 7,056
Total costs and expenses 171,458 154,381 333,119 314,185
Operating income (loss) 5,545 (5,274) 3,269 696
Loss in equity method
investee - - - (1,761)
Other income (expense), net 641 (1,173) 553 (2,364)
Income (loss) before
income taxes $ 6,186 $ (6,447) $ 3,822 $ (3,429)
Income tax expense (249) (220) (602) (225)
Net income (loss) $ 5,937 $ (6,667) $ 3,220 $ (3,654)
Net income (loss) per
share, diluted $ 0.03 $ (0.04) $ 0.02 $ (0.02)
Weighted average outstanding
diluted shares 192,195 186,639 191,315 186,513
RF MICRO DEVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
September 30, September 30,
2005 2004 2005 2004
GAAP net income (loss) $ 5,937 $ (6,667) $ 3,220 $ (3,654)
Tax-effected adjustments:
Amortization of deferred
stock compensation 1,892 948 2,938 2,812
Compensation expense
for options subject to
variable accounting 282 - 282 -
Amortization of
intangible assets 441 1,649 807 3,266
Discount and issuance
cost write-off related
to the extinguishments
of the 3.75% convertible
debt - 642 - 642
In process research and
development charge - - - 6,201
Customer related payment - - 5,000 -
Discontinuation of WLAN
chipset development
efforts/(adjustment) 166 - (684) -
Impairment charge - 391 - 391
Pro forma net income (loss) 8,718 (3,037) 11,563 9,658
Plus: Income impact of
assumed conversions for
interest on 1.50%
convertible notes 1,035 - - -
Pro forma net income (loss)
plus assumed conversion of
notes - Numerator for
diluted income (loss) per
share $ 9,753 $ (3,037) $ 11,563 $ 9,658
GAAP weighted average
outstanding diluted
shares 192,195 186,639 191,315 186,513
Adjustments:
Dilutive stock options - - - -
Assumed conversion of
1.50% convertible notes 30,144 - - -
Pro forma weighted average
outstanding diluted shares 222,339 186,639 191,315 186,513
Pro forma net income
(loss) per share, diluted $ 0.04 $ (0.02) $ 0.06 $ 0.05
RF MICRO DEVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
September 30, March 31,
2005 2005
(Unaudited) (Audited)
ASSETS
Current assets:
Cash and cash equivalents $ 59,972 $ 26,016
Short-term investments 76,574 134,828
Accounts receivable, net 88,975 74,545
Inventories 92,793 75,090
Other current assets 15,203 15,970
Total current assets 333,517 326,449
Property and equipment, net 339,663 339,624
Goodwill 119,709 119,694
Investment in Jazz Semiconductor, Inc. 59,265 59,265
Long-term investments 271 365
Intangible assets, net 11,464 11,316
Other assets 2,651 3,033
Total assets $866,540 $859,746
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 76,933 $ 74,684
Other short-term liabilities, net 89 4,968
Total current liabilities 77,022 79,652
Long-term debt, net 226,520 226,168
Other long-term liabilities 5,672 5,876
Total liabilities 309,214 311,696
Shareholders' equity:
Total shareholders' equity 557,326 548,050
Total liabilities and shareholders' equity $866,540 $859,746
