FORM 8-K |
Delaware (State or Other Jurisdiction of Incorporation or Organization) | 94-2896096 (I.R.S. Employer I. D. No.) |
Exhibit | Description | |
99.1 | Press release, dated July 21, 2016 announcing the Company's preliminary financial results for the fourth quarter of fiscal year 2016. |
Maxim Integrated Products, Inc. | |
By:/s/ Bruce E. Kiddoo | |
Bruce E. Kiddoo Senior Vice President and Chief Financial Officer |
Exhibit | Description | |
99.1 | Press release, dated July 21, 2016 announcing the Company's preliminary financial results for the fourth quarter of fiscal year 2016. Also provided in PDF format as a courtesy. |
• | Revenue: $566 million |
• | Gross Margin: 61.3% GAAP (64.1% excluding special items) |
• | EPS: $0.32 GAAP profit ($0.49 profit excluding special items) |
• | Cash, cash equivalents, and short term investments: $2.23 billion |
• | Fiscal first quarter revenue outlook: $540 million to $580 million |
• | Quarterly dividend increased 10% to $0.33 per share |
• | Cash flow from operations: $254 million |
• | Proceeds from term loan: $250 million |
• | Capital expenditures: $22 million |
• | Proceeds from asset sales: $35 million |
• | Dividends: $85 million ($0.30 per share) |
• | Stock repurchases: $90 million |
• | Revenue: $540 million to $580 million |
• | Gross Margin: 61% to 63% GAAP (63% to 65% excluding special items) |
• | EPS: $0.40 to $0.46 GAAP ($0.44 to $0.50 excluding special items) |
CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||
June 25, 2016 | March 26, 2016 | June 27, 2015 | June 27, 2015 | June 27, 2015 | |||||||||||||||||
(in thousands, except per share data) | |||||||||||||||||||||
Net revenues | $ | 566,126 | $ | 555,252 | $ | 582,517 | $ | 2,194,719 | $ | 2,306,864 | |||||||||||
Cost of goods sold (1) (2) | 219,099 | 236,411 | 278,816 | 950,331 | 1,034,997 | ||||||||||||||||
Gross margin | 347,027 | 318,841 | 303,701 | 1,244,388 | 1,271,867 | ||||||||||||||||
Operating expenses: | |||||||||||||||||||||
Research and development | 113,491 | 119,178 | 121,552 | 467,161 | 521,772 | ||||||||||||||||
Selling, general and administrative | 71,483 | 71,778 | 72,532 | 288,899 | 308,065 | ||||||||||||||||
Intangible asset amortization | 2,538 | 2,538 | 3,618 | 12,205 | 16,077 | ||||||||||||||||
Impairment of long-lived assets (3) | 429 | 506 | 549 | 160,582 | 67,042 | ||||||||||||||||
Impairment of goodwill and intangible assets | 27,602 | — | — | 27,602 | 93,010 | ||||||||||||||||
Severance and restructuring expenses | 4,149 | 2,552 | 12,798 | 24,479 | 30,642 | ||||||||||||||||
Other operating expenses (income), net (4) | 4,962 | (55,419 | ) | (2,296 | ) | (50,389 | ) | (2,021 | ) | ||||||||||||
Total operating expenses (income), net | 224,654 | 141,133 | 208,753 | 930,539 | 1,034,587 | ||||||||||||||||
Operating income (loss) | 122,373 | 177,708 | 94,948 | 313,849 | 237,280 | ||||||||||||||||
Interest and other income (expense), net (5) | (6,427 | ) | (6,373 | ) | 28,500 | (28,795 | ) | 8,890 | |||||||||||||
Income (loss) before provision for income taxes | 115,946 | 171,335 | 123,448 | 285,054 | 246,170 | ||||||||||||||||
Income tax provision (benefit) | 23,607 | 31,525 | 24,789 | 57,579 | 40,132 | ||||||||||||||||
Net income (loss) | $ | 92,339 | $ | 139,810 | $ | 98,659 | $ | 227,475 | $ | 206,038 | |||||||||||
Earnings (loss) per share: | |||||||||||||||||||||
Basic | $ | 0.32 | $ | 0.49 | $ | 0.35 | $ | 0.80 | $ | 0.73 | |||||||||||
Diluted | $ | 0.32 | $ | 0.48 | $ | 0.34 | $ | 0.79 | $ | 0.71 | |||||||||||
Shares used in the calculation of earnings (loss) per share: | |||||||||||||||||||||
Basic | 285,354 | 285,854 | 284,202 | 285,081 | 283,675 | ||||||||||||||||
Diluted | 288,544 | 289,783 | 289,346 | 289,479 | 288,949 | ||||||||||||||||
Dividends paid per share | $ | 0.30 | $ | 0.30 | $ | 0.28 | $ | 1.20 | $ | 1.12 | |||||||||||
SCHEDULE OF SPECIAL ITEMS | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||
June 25, 2016 | March 26, 2016 | June 27, 2015 | June 25, 2016 | June 27, 2015 | |||||||||||||||||
(in thousands) | |||||||||||||||||||||
Cost of goods sold: | |||||||||||||||||||||
Intangible asset amortization | $ | 11,829 | $ | 11,829 | $ | 18,116 | $ | 55,030 | $ | 74,366 | |||||||||||
Accelerated depreciation (1) | 4,098 | 4,066 | 32,765 | 53,827 | 51,494 | ||||||||||||||||
Other cost of goods sold (2) | — | 6,123 | — | 6,123 | — | ||||||||||||||||
Total | $ | 15,927 | $ | 22,018 | $ | 50,881 | $ | 114,980 | $ | 125,860 | |||||||||||
Operating expenses: | |||||||||||||||||||||
Intangible asset amortization | $ | 2,538 | $ | 2,538 | $ | 3,618 | $ | 12,205 | $ | 16,077 | |||||||||||
Impairment of long-lived assets (3) | 429 | 506 | 549 | 160,582 | 67,042 | ||||||||||||||||
Impairment of goodwill and intangible assets | 27,602 | — | — | 27,602 | 93,010 | ||||||||||||||||
Severance and restructuring | 4,149 | 2,552 | 12,798 | 24,479 | 30,642 | ||||||||||||||||
Other operating expenses (income), net (4) | 4,962 | (55,419 | ) | (2,296 | ) | (50,389 | ) | (2,021 | ) | ||||||||||||
Total | $ | 39,680 | $ | (49,823 | ) | $ | 14,669 | $ | 174,479 | $ | 204,750 | ||||||||||
Interest and other expense (income), net (5) | $ | (247 | ) | $ | (45 | ) | $ | (35,849 | ) | $ | 194 | $ | (36,066 | ) | |||||||
Total | $ | (247 | ) | $ | (45 | ) | $ | (35,849 | ) | $ | 194 | $ | (36,066 | ) | |||||||
Income tax provision (benefit): | |||||||||||||||||||||
Reversal of tax reserves (6) | $ | — | $ | — | $ | — | $ | — | $ | (21,747 | ) | ||||||||||
Fiscal year 2015 & 2014 research & development tax credits | — | — | — | (2,475 | ) | (2,863 | ) | ||||||||||||||
Total | $ | — | $ | — | $ | — | $ | (2,475 | ) | $ | (24,610 | ) | |||||||||
(1) Includes building and equipment accelerated depreciation related to San Jose and Dallas manufacturing facilities. | |||||||||||||||||||||
(2) Includes expense related to patent license settlement. | |||||||||||||||||||||
(3) Includes impairment charges relating to the San Antonio wafer manufacturing facility and other wafer manufacturing equipment, end of line test equipment, and software. | |||||||||||||||||||||
(4) Includes gain on sale of energy metering business during the third quarter of fiscal year 2016, loss (gain) relating to sale of assets, and expected loss on lease abandonment. | |||||||||||||||||||||
(5) Includes sale of a business and impairment of investment in privately-held companies. | |||||||||||||||||||||
(6) Reversal of tax reserves related to the favorable settlement of a foreign tax issue. | |||||||||||||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||||
(Unaudited) | |||||||||||||
June 25, 2016 | March 26, 2016 | June 27, 2015 | |||||||||||
(in thousands) | |||||||||||||
ASSETS | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ | 2,105,229 | $ | 1,710,340 | 1,550,965 | ||||||||
Short-term investments | 125,439 | 150,076 | 75,154 | ||||||||||
Total cash, cash equivalents and short-term investments | 2,230,668 | 1,860,416 | 1,626,119 | ||||||||||
Accounts receivable, net | 256,531 | 278,502 | 278,844 | ||||||||||
Inventories | 227,929 | 234,603 | 288,474 | ||||||||||
Deferred tax assets | — | — | 77,306 | ||||||||||
Other current assets | 91,920 | 80,792 | 48,660 | ||||||||||
Total current assets | 2,807,048 | 2,454,313 | 2,319,403 | ||||||||||
Property, plant and equipment, net | 692,551 | 748,781 | 1,090,739 | ||||||||||
Intangible assets, net | 146,540 | 188,510 | 261,652 | ||||||||||
Goodwill | 490,648 | 490,648 | 511,647 | ||||||||||
Other assets | 84,100 | 74,972 | 24,422 | ||||||||||
Assets held for sale | 13,729 | 13,733 | 8,208 | ||||||||||
TOTAL ASSETS | $ | 4,234,616 | $ | 3,970,957 | $ | 4,216,071 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||
Current liabilities: | |||||||||||||
Accounts payable | $ | 82,535 | $ | 82,696 | 88,322 | ||||||||
Income taxes payable | 21,153 | 30,907 | 34,779 | ||||||||||
Accrued salary and related expenses | 166,698 | 151,411 | 181,360 | ||||||||||
Accrued expenses | 50,521 | 42,562 | 47,365 | ||||||||||
Deferred revenue on shipments to distributors | 38,779 | 34,457 | 30,327 | ||||||||||
Short term debt | 249,717 | — | 1,024 | ||||||||||
Total current liabilities | 609,403 | 342,033 | 383,177 | ||||||||||
Long-term debt | 990,090 | 989,489 | 987,687 | ||||||||||
Income taxes payable | 480,645 | 451,099 | 410,378 | ||||||||||
Deferred tax liabilities | 756 | 643 | 90,588 | ||||||||||
Other liabilities | 45,908 | 48,930 | 54,221 | ||||||||||
Total liabilities | 2,126,802 | 1,832,194 | 1,926,051 | ||||||||||
Stockholders' equity: | |||||||||||||
Common stock | 284 | 280 | 283 | ||||||||||
Additional paid-in capital | — | — | 27,859 | ||||||||||
Retained earnings | 2,121,749 | 2,154,767 | 2,279,112 | ||||||||||
Accumulated other comprehensive loss | (14,219 | ) | (16,284 | ) | (17,234 | ) | |||||||
Total stockholders' equity | 2,107,814 | 2,138,763 | 2,290,020 | ||||||||||
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | 4,234,616 | $ | 3,970,957 | $ | 4,216,071 | |||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||
June 25, 2016 | March 26, 2016 | June 27, 2015 | June 25, 2016 | June 27, 2015 | |||||||||||||||||
(in thousands) | |||||||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||||
Net income (loss) | $ | 92,339 | $ | 139,810 | $ | 98,659 | $ | 227,475 | $ | 206,038 | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||||||||||||
Stock-based compensation | 16,444 | 17,875 | 17,709 | 69,701 | 79,491 | ||||||||||||||||
Depreciation and amortization | 46,414 | 47,088 | 92,639 | 244,637 | 299,396 | ||||||||||||||||
Deferred taxes | (13,510 | ) | (333 | ) | (32,207 | ) | (48,138 | ) | (72,507 | ) | |||||||||||
In-process research and development written-off | 27,602 | — | — | 27,602 | 8,900 | ||||||||||||||||
Loss (gain) from sale of property, plant and equipment | 5,048 | 3,098 | (1,228 | ) | 2,283 | 419 | |||||||||||||||
Tax benefit (shortfall) related to stock-based compensation | 3,657 | 545 | (861 | ) | 7,375 | 8,155 | |||||||||||||||
Excess tax benefit from stock-based compensation | (1,890 | ) | (1,491 | ) | (2,372 | ) | (9,550 | ) | (12,549 | ) | |||||||||||
Impairment of long-lived assets | — | 506 | 517 | 160,153 | 67,010 | ||||||||||||||||
Impairment of goodwill and intangible assets | — | — | — | — | 84,110 | ||||||||||||||||
Impairment of investments in privately-held companies | — | — | 94 | — | 94 | ||||||||||||||||
Loss (gain) on sale of business | — | (58,944 | ) | (35,849 | ) | (58,944 | ) | (35,849 | ) | ||||||||||||
Changes in assets and liabilities: | |||||||||||||||||||||
Accounts receivable | 21,971 | (47,322 | ) | (417 | ) | 22,313 | 16,984 | ||||||||||||||
Inventories | 7,657 | 22,785 | 10,105 | 44,086 | 2,163 | ||||||||||||||||
Other current assets | 8,012 | (8,947 | ) | 15,338 | 2,943 | (8,783 | ) | ||||||||||||||
Accounts payable | 5,076 | 8,683 | 2,874 | (3,676 | ) | (4,201 | ) | ||||||||||||||
Income taxes payable | 19,792 | 29,597 | 39,217 | 56,641 | 62,350 | ||||||||||||||||
Deferred revenue on shipments to distributors | 4,322 | 2,390 | (223 | ) | 8,452 | 4,593 | |||||||||||||||
All other accrued liabilities | 11,137 | 12,646 | 17,793 | (31,468 | ) | (12,110 | ) | ||||||||||||||
Net cash provided by (used in) operating activities | 254,071 | 167,986 | 221,788 | 721,885 | 693,704 | ||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||
Payments for property, plant and equipment | (22,488 | ) | (17,530 | ) | (15,360 | ) | (69,369 | ) | (75,816 | ) | |||||||||||
Proceeds from sales of property, plant and equipment | 34,691 | 136 | 2,741 | 85,142 | 29,035 | ||||||||||||||||
Proceeds from sale of business | — | 105,000 | 35,550 | 105,000 | 35,550 | ||||||||||||||||
Purchases of available-for-sale securities | (25,000 | ) | (24,861 | ) | — | (99,948 | ) | (25,142 | ) | ||||||||||||
Purchases of privately-held companies securities | (1,554 | ) | (1,921 | ) | — | (10,483 | ) | (200 | ) | ||||||||||||
Proceeds from maturity of available-for-sale securities | 50,000 | — | — | 50,000 | — | ||||||||||||||||
Proceeds from sales of investments of privately-held companies | — | — | — | 500 | |||||||||||||||||
Other investing activities | — | — | — | 2,380 | — | ||||||||||||||||
Net cash provided by (used in) investing activities | 35,649 | 60,824 | 22,931 | 62,722 | (36,073 | ) | |||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||
Excess tax benefit from stock-based compensation | 1,890 | 1,491 | 2,372 | 9,550 | 12,549 | ||||||||||||||||
Repayment of notes payable | — | — | — | — | (437 | ) | |||||||||||||||
Issuance of debt | 249,717 | — | — | 249,717 | — | ||||||||||||||||
Net issuance of restricted stock units | (2,687 | ) | (8,853 | ) | (7,428 | ) | (24,084 | ) | (30,657 | ) | |||||||||||
Proceeds from stock options exercised | 12,272 | 9,889 | 12,328 | 79,608 | 61,453 | ||||||||||||||||
Issuance of common stock under employee stock purchase program | 19,625 | — | 22,298 | 33,975 | 40,951 | ||||||||||||||||
Repurchase of common stock | (90,438 | ) | (83,801 | ) | (35,963 | ) | (237,086 | ) | (195,088 | ) | |||||||||||
Dividends paid | (85,210 | ) | (85,714 | ) | (79,558 | ) | (342,023 | ) | (317,909 | ) | |||||||||||
Net cash provided by (used in) financing activities | 105,169 | (166,988 | ) | (85,951 | ) | (230,343 | ) | (429,138 | ) | ||||||||||||
Net increase (decrease) in cash and cash equivalents | 394,889 | 61,822 | 158,768 | 554,264 | 228,493 | ||||||||||||||||
Cash and cash equivalents: | |||||||||||||||||||||
Beginning of period | 1,710,340 | 1,648,518 | 1,392,197 | 1,550,965 | 1,322,472 | ||||||||||||||||
End of period | $ | 2,105,229 | $ | 1,710,340 | $ | 1,550,965 | $ | 2,105,229 | $ | 1,550,965 | |||||||||||
Total cash, cash equivalents and short-term investments | $ | 2,230,668 | $ | 1,860,416 | $ | 1,626,119 | $ | 2,230,668 | $ | 1,626,119 | |||||||||||
ANALYSIS OF GAAP VERSUS GAAP EXCLUDING SPECIAL ITEMS DISCLOSURES | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||
June 25, 2016 | March 26, 2016 | June 27, 2015 | June 25, 2016 | June 27, 2015 | |||||||||||||||||
(in thousands, except per share data) | |||||||||||||||||||||
Reconciliation of GAAP gross profit to GAAP gross profit excluding special items: | |||||||||||||||||||||
GAAP gross profit | $ | 347,027 | $ | 318,841 | $ | 303,701 | $ | 1,244,388 | $ | 1,271,867 | |||||||||||
GAAP gross profit % | 61.3 | % | 57.4 | % | 52.1 | % | 56.7 | % | 55.1 | % | |||||||||||
Special items: | |||||||||||||||||||||
Intangible asset amortization | 11,829 | 11,829 | 18,116 | 55,030 | 74,366 | ||||||||||||||||
Accelerated Depreciation (1) | 4,098 | 4,066 | 32,765 | 53.827 | 51.494 | ||||||||||||||||
Other cost of goods sold (2) | — | 6,123 | — | 6,123 | — | ||||||||||||||||
Total special items | 15,927 | 22,018 | 50,881 | 114,980 | 125,860 | ||||||||||||||||
GAAP gross profit excluding special items | $ | 362,954 | $ | 340,859 | $ | 354,582 | $ | 1,359,368 | $ | 1,397,727 | |||||||||||
GAAP gross profit % excluding special items | 64.1 | % | 61.4 | % | 60.9 | % | 61.9 | % | 60.6 | % | |||||||||||
Reconciliation of GAAP operating expenses to GAAP operating expenses excluding special items: | |||||||||||||||||||||
GAAP operating expenses | $ | 224,654 | $ | 141,133 | $ | 208,753 | $ | 930,539 | $ | 1,034,587 | |||||||||||
Special items: | |||||||||||||||||||||
Intangible asset amortization | 2,538 | 2,538 | 3,618 | 12,205 | 16,077 | ||||||||||||||||
Impairment of long-lived assets (3) | 429 | 506 | 549 | 160,582 | 67,042 | ||||||||||||||||
Impairment of goodwill and intangible assets | 27,602 | — | — | 27,602 | 93,010 | ||||||||||||||||
Severance and restructuring | 4,149 | 2,552 | 12,798 | 24,479 | 30,642 | ||||||||||||||||
Other operating expenses (income), net (4) | 4,962 | (55,419 | ) | (2,296 | ) | (50,389 | ) | (2,021 | ) | ||||||||||||
Total special items | 39,680 | (49,823 | ) | 14,669 | 174,479 | 204,750 | |||||||||||||||
GAAP operating expenses excluding special items | $ | 184,974 | $ | 190,956 | $ | 194,084 | $ | 756,060 | $ | 829,837 | |||||||||||
Reconciliation of GAAP net income to GAAP net income excluding special items: | |||||||||||||||||||||
GAAP net income | $ | 92,339 | $ | 139,810 | $ | 98,659 | $ | 227,475 | $ | 206,038 | |||||||||||
Special items: | |||||||||||||||||||||
Intangible asset amortization | 14,367 | 14,367 | 21,734 | 67,235 | 90,443 | ||||||||||||||||
Accelerated Depreciation (1) | 4,098 | 4,066 | 32,765 | 53,827 | 51,494 | ||||||||||||||||
Other cost of goods sold (2) | — | 6,123 | — | 6,123 | — | ||||||||||||||||
Impairment of long-lived assets (3) | 429 | 506 | 549 | 160,582 | 67,042 | ||||||||||||||||
Impairment of goodwill and intangible assets | 27,602 | — | — | 27,602 | 93,010 | ||||||||||||||||
Severance and restructuring | 4,149 | 2,552 | 12,798 | 24,479 | 30,642 | ||||||||||||||||
Other operating expenses (income), net (4) | 4,962 | (55,419 | ) | (2,296 | ) | (50,389 | ) | (2,021 | ) | ||||||||||||
Interest and other expense, net (5) | (247 | ) | (45 | ) | (35,849 | ) | 194 | (36,066 | ) | ||||||||||||
Pre-tax total special items | 55,360 | (27,850 | ) | 29,701 | 289,653 | 294,544 | |||||||||||||||
Reversal of tax reserves (6) | — | — | — | — | (21,747 | ) | |||||||||||||||
Fiscal year 2015 & 2014 research & development tax credits | — | — | — | (2,475 | ) | (2,863 | ) | ||||||||||||||
Other income tax effects and adjustments (7) | (7,228 | ) | 5,698 | (4,267 | ) | (43,392 | ) | (35,333 | ) | ||||||||||||
GAAP net income excluding special items | $ | 140,471 | $ | 117,658 | $ | 124,093 | $ | 471,261 | $ | 440,639 | |||||||||||
GAAP net income per share excluding special items: | |||||||||||||||||||||
Basic | $ | 0.49 | $ | 0.41 | $ | 0.44 | $ | 1.65 | $ | 1.55 | |||||||||||
Diluted | $ | 0.49 | $ | 0.41 | $ | 0.43 | $ | 1.63 | $ | 1.52 | |||||||||||
Shares used in the calculation of earnings per share excluding special items: | |||||||||||||||||||||
Basic | 285,354 | 285,854 | 284,202 | 285,081 | 283,675 | ||||||||||||||||
Diluted | 288,544 | 289,783 | 289,346 | 289,479 | 288,949 | ||||||||||||||||
(1) Includes building and equipment accelerated depreciation related to San Jose and Dallas manufacturing facilities. | |||||||||||||||||||||
(2) Includes expense related to patent license settlement. | |||||||||||||||||||||
(3) Includes impairment charges relating to the San Antonio wafer manufacturing facility and other wafer manufacturing equipment, end of line test equipment, and software. | |||||||||||||||||||||
(4) Includes gain on sale of energy metering business during the third quarter of fiscal year 2016, loss (gain) relating to sale of assets, and expected loss on lease abandonment. | |||||||||||||||||||||
(5) Includes sale of a business and impairment of investment in privately-held companies. | |||||||||||||||||||||
(6) Reversal of tax reserves related to the favorable settlement of a foreign tax issue. | |||||||||||||||||||||
(7) Includes tax effect of pre-tax special items and miscellaneous tax adjustments. | |||||||||||||||||||||
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