EX-99.2 3 dex992.htm GAAP CONSOLIDATED STATEMENT OF OPERATIONS AND GAAP CONSOLIDATED BALANCE SHEET GAAP Consolidated Statement of Operations and GAAP Consolidated Balance Sheet

Exhibit 99.2

Lattice Semiconductor Corporation

Consolidated Statement of Operations

(in thousands, except per share data)

(Unaudited)

 

     Three months ended     Year ended  
     January 3,
2009
    September 27,
2008
    December 29,
2007
    January 3,
2009
    December 29,
2007
 

Revenue

   $ 49,969     $ 57,610     $ 53,055     $ 222,262     $ 228,709  

Costs and expenses:

          

Cost of products sold

     25,627       26,493       23,641       102,831       103,157  

Research and development

     15,471       17,534       20,051       68,610       82,977  

Selling, general and administrative

     13,939       14,547       14,080       58,680       58,485  

Goodwill impairment (1)

     —         —         223,556       —         223,556  

Amortization of intangible assets (2)

     1,369       1,369       2,042       5,587       9,832  

Restructuring (3)

     259       3,882       757       6,789       2,372  
                                        
     56,665       63,825       284,127       242,497       480,379  
                                        

Loss from operations

     (6,696 )     (6,215 )     (231,072 )     (20,235 )     (251,670 )

Other (expense) income, net (4)

     (7,605 )     (999 )     1,682       (17,791 )     12,540  
                                        

Loss before provision (benefit) for income taxes

     (14,301 )     (7,214 )     (229,390 )     (38,026 )     (239,130 )

Provision (benefit) for income taxes

     102       (236 )     135       180       686  
                                        

Net loss

   $ (14,403 )   $ (6,978 )   $ (229,525 )   $ (38,206 )   $ (239,816 )
                                        

Net loss per share (5):

          

Basic and diluted

   $ (0.12 )   $ (0.06 )   $ (1.99 )   $ (0.33 )   $ (2.09 )
                                        

Shares used in per share calculations:

          

Basic and diluted

     115,456       115,370       115,121       115,291       114,915  
                                        

 

Notes:

 

(1) At December 29, 2007, the Company performed an impairment test on Goodwill in accordance with SFAS No. 142, “Goodwill and Other Intangible Assets.” As a result, goodwill related to the acquisition of Vantis Corporation on June 15, 1999, the acquisition of Integrated Intellectual Properties, Inc. on March 16, 2001, and the acquisition of the FPGA business of Agere Systems, Inc. on January 18, 2002, was determined to have no implied fair value and the entire balance of $223.6 million was recorded as a Goodwill impairment charge.

 

(2) Intangible assets subject to amortization aggregate $0.2 million, net, at January 3, 2009, and relate to the acquisition of the FPGA business of Agere Systems, Inc. on January 18, 2002. Intangible assets related to the acquisition of Cerdelinx Technologies, Inc., became fully amortized in the third quarter of 2007. Amortization charges are expected to be eliminated during the first quarter of 2009.

 

(3) Represents costs and adjustments incurred under the corporate restructuring plans initiated in the fourth quarter of fiscal 2005, the third quarter of fiscal 2007 and the third quarter of fiscal 2008. During the third quarter of fiscal 2008, the Company initiated a restructuring plan to lower operating expenses. During fiscal 2008, the Company recorded a charge of $4.1 million related to the 2008 restructuring plan comprised primarily of severance and related costs, of which $3.8 million was paid during fiscal 2008. Also, during fiscal 2008, the Company recorded a charge of $2.7 million related to the 2007 restructuring plan comprised primarily of severance and related costs and costs to vacate leased space. The Company recorded charges of $1.0 million and $2.7 million during the fourth quarter and year ended December 29, 2007, respectively. These charges relate to the 2007 restructuring plan and were primarily comprised of severance costs. Also, during the fourth quarter ended December 29, 2007, the Company recorded an offsetting credit of $0.2 million related to the buyout of an operating lease for property vacated under the 2005 restructuring plan.

 

(4) Includes an $8.0 million and $19.7 million loss recorded during the three months and year ended January 3, 2009, respectively, as a result of the Company recognizing an impairment charge related to an other-than-temporary decline in fair value of auction rate securities held in Long-term marketable securities and a $1.2 million loss on the sale or other-than-temporary impairment charge on our common stock investment in a foundry partner. Includes a $1.6 million gain recorded during the three months ended June 30, 2007 as a result of the Company selling a parcel of undeveloped land near its corporate headquarters. Includes a gain related to the early extinguishment of Zero Coupon Convertible Notes of $2.7 million recorded during the year ended December 29, 2007.

 

(5) For all periods presented, the computation of diluted earnings per share excludes the effects of stock options, restricted stock units, warrants and Convertible Notes, as they are antidilutive.


Lattice Semiconductor Corporation

Consolidated Balance Sheet

(in thousands)

(unaudited)

 

     January 3,
2009
   December 29,
2007
Assets      

Current assets:

     

Cash, cash equivalents and short-term marketable securities (1)

   $ 65,909    $ 85,063

Accounts receivable, net

     26,404      29,293

Other receivable (2)

     60,000      —  

Inventories

     32,703      40,005

Other current assets

     26,820      37,185
             

Total current assets

     211,836      191,546

Property and equipment, net

     40,307      43,617

Long-term marketable securities (1)

     19,485      44,900

Foundry advances, investments and other assets (2)

     20,080      90,407

Intangible assets, net

     228      5,815
             
   $ 291,936    $ 376,285
             
Liabilities and Stockholders’ Equity      

Current liabilities:

     

Accounts payable and other accrued liabilities

   $ 23,640    $ 32,978

Deferred income and allowances on sales to distributors

     5,741      8,033

Zero Coupon Convertible Notes due in 2010 (3)

     —        40,000
             

Total current liabilities

     29,381      81,011

Other long-term liabilities

     7,616      9,042
             

Total liabilities

     36,997      90,053

Stockholders’ equity

     254,939      286,232
             
   $ 291,936    $ 376,285
             

 

Notes:

 

(1) Long-term marketable securities include auction rate securities that were reclassified from Cash, cash equivalents and short-term marketable securities because recent auctions have been unsuccessful, and as a result, such securities are presently considered to be illiquid. As a result of an other-than-temporary decline in fair value for the securities, we recorded an impairment charge of $19.7 million to Net loss for the year ended January 3, 2009.

 

(2) On December 18, 2008, the Company entered into a letter agreement with Fujitsu in connection with the Company’s exercise of its right to request repayment of the Advance Payment pursuant to the Advance Payment and Purchase Agreement, as amended. Under the terms of the letter agreement, the Company has requested and Fujitsu has agreed to repay in cash the outstanding portion of the Advance Payment, of which $60.0 million is receivable in fiscal 2009. As a result, $60.0 million has been reclassified from Foundry advances, investments and other assets to Other receivable.

 

(3) On July 2, 2008, the company completed the purchase of $40.0 million in principal amount of its Zero Coupon Convertible Notes (“Notes”) due July 1, 2010. The Notes were purchased pursuant to the exercise by the noteholders of their repurchase rights. Based on these purchases, no such Notes remain outstanding.