North Carolina
|
0-21154
|
56-1572719
|
(State or other jurisdiction of
incorporation)
|
(Commission File
Number)
|
(I.R.S. Employer
Identification Number)
|
4600 Silicon Drive
|
|
Durham, North Carolina
|
27703
|
(Address of principal executive offices)
|
(Zip Code)
|
Item 2.02
|
Results of Operations and Financial Condition
|
Item 5.02
|
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Directors
|
Item 9.01
|
Financial Statements and Exhibits
|
Exhibit No.
|
Description of Exhibit
|
||
99.1
|
Press release dated October 18, 2011
|
CREE, INC.
|
|||
By:
|
/s/ John T. Kurtzweil
|
||
John T. Kurtzweil
|
|||
Executive Vice President - Finance,
Chief Financial Officer and Treasurer
|
Exhibit No.
|
Description of Exhibit
|
||
99.1
|
Press release dated October 18, 2011
|
For Immediate Release
|
Press Release
|
Contact:
|
Raiford Garrabrant
|
Cree, Inc.
|
|
Director, Investor Relations
|
|
Ph: 919-407-7895
|
|
Fax: 919-407-5615
|
|
Email: investorrelations@cree.com
|
First Quarter | ||||||||
2012 | 2011 | Change | ||||||
(unaudited) | (unaudited) | |||||||
Net revenue
|
$ |
268,980
|
$ |
268,437
|
$ |
543
|
—%
|
|
GAAP
|
||||||||
Gross Margin
|
36.4%
|
48.6%
|
|
|
||||
Operating Margin
|
5.0%
|
27.3%
|
||||||
Net Income
|
$ |
12,819
|
$ |
58,036
|
$ |
(45,217)
|
(78)%
|
|
Earnings per diluted share
|
$ |
0.11
|
$ |
0.53
|
$ |
(0.42)
|
(79)%
|
|
Non-GAAP
|
||||||||
Gross Margin
|
37.4%
|
49.0%
|
|
|
||||
Operating Margin
|
12.2%
|
31.3%
|
||||||
Net Income
|
$ |
28,058
|
$ |
66,283
|
$ |
(38,225)
|
(58)%
|
|
Earnings per diluted share
|
$ |
0.25
|
$ |
0.60
|
$ |
(0.35)
|
(58)%
|
»
|
»
|
»
|
Acquired Ruud Lighting to accelerate LED lighting adoption and expand the market for LED components;
|
»
|
Launched industry-leading TEMPOTM evaluation services to help lighting OEMs speed time-to-market and overcome design challenges;
|
»
|
Introduced a new XLamp® XP-G that delivers up to 140 lumens per watt;
|
»
|
Promoted Norbert Hiller to executive vice president for LEDs and Ty Mitchell to executive vice president for Lighting.
|
CREE, INC.
|
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
|
||||||||
(in thousands, except per share amounts and percentages)
|
||||||||
(Unaudited) | ||||||||
Three Months Ended
|
||||||||
September 25,
|
September 26,
|
|||||||
2011
|
2010
|
|||||||
(Thousands, except per share amounts)
|
||||||||
Revenue, net
|
$ |
268,980
|
$ |
268,437
|
||||
Cost of revenue, net
|
170,952
|
137,908
|
||||||
Gross profit
|
98,028
|
130,529
|
||||||
Gross Margin Percentage
|
36.4
|
%
|
48.6
|
% | ||||
Operating expenses:
|
||||||||
Research and development
|
34,402
|
24,732
|
||||||
Sales, general and administrative
|
45,539
|
29,202
|
||||||
Amortization of acquisition related intangibles
|
3,925
|
2,706
|
||||||
Loss on disposal or impairment of long-lived assets
|
775
|
472
|
||||||
Total operating expenses
|
84,641
|
57,112
|
||||||
Operating income
|
13,387
|
73,417
|
||||||
Operating income percentage |
5.0
|
% |
27.3
|
% | ||||
Non-operating income:
|
||||||||
Interest and other non-operating income, net
|
2,943
|
1,954
|
||||||
Income from operations before income taxes
|
16,330
|
75,371
|
||||||
Income tax expense
|
3,511
|
17,335
|
||||||
Net income | $ |
12,819
|
58,036
|
|||||
Earnings per share:
|
||||||||
Diluted net income per share
|
$ |
0.11
|
$ |
0.53
|
||||
Shares used in diluted per share calculation
|
112,543
|
109,617
|
||||||
CREE, INC.
|
|||||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|||||||
(in thousands)
|
|||||||
September 25, | |||||||
2011
|
June 26,
|
||||||
(unaudited)
|
2011
|
||||||
(Thousands)
|
|||||||
ASSETS
|
|||||||
Current assets:
|
|||||||
Cash, cash equivalents, and short term investments
|
$ |
632,228
|
$ |
1,085,797
|
|||
Accounts receivable, net
|
165,694
|
118,469
|
|||||
Income tax receivable |
1,655
|
6,796
|
|||||
Inventories
|
203,625
|
176,482
|
|||||
Deferred income taxes
|
18,615
|
17,857
|
|||||
Prepaid expenses and other current assets
|
58,913
|
51,494
|
|||||
Total current assets
|
1,080,730
|
1,456,895
|
|||||
Property and equipment, net
|
606,856
|
55,929
|
|||||
Intangible assets, net
|
390,501
|
102,860
|
|||||
Goodwill
|
613,843
|
326,178
|
|||||
Other assets
|
5,460
|
4,860
|
|||||
Total assets
|
$ |
2,697,390
|
$ |
2,446,722
|
|||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|||||||
Current liabilities:
|
|||||||
Accounts payable, trade
|
$ |
74,122
|
$ |
76,593
|
|||
Accrued salaries and wages
|
25,705
|
18,491
|
|||||
Income taxes payable
|
12,576
|
15,493
|
|||||
Other current liabilities
|
40,033
|
29,739
|
|||||
Total current liabilities
|
152,436
|
140,316
|
|||||
Long-term liabilities:
|
|||||||
Deferred income taxes
|
21,902
|
21,902
|
|||||
Other long-term liabilities
|
25,015
|
22,940
|
|||||
Total long-term liabilities
|
46,917
|
44,842
|
|||||
Shareholders' equity:
|
|||||||
Common stock
|
144
|
136
|
|||||
Additional paid-in-capital
|
1,817,748
|
1,593,530
|
|||||
Accumulated other comprehensive income, net of taxes
|
12,519
|
13,091
|
|||||
Retained earnings
|
667,626
|
654,807
|
|||||
Total shareholders' equity
|
2,498,037
|
2,261,564
|
|||||
Total liabilities and shareholders' equity
|
$ |
2,697,390
|
$ |
2,446,722
|
CREE, INC.
|
||||||||
Reconciliation of GAAP to Non-GAAP Measures
|
||||||||
(in thousands, except per share amounts and percentages)
|
||||||||
(unaudited)
|
||||||||
Non-GAAP Gross Margin | ||||||||
Three Months Ended
|
||||||||
September 25,
2011
|
September 26,
2010
|
|||||||
GAAP gross profit
|
98,028 | 130,529 | ||||||
GAAP gross margin percentage
|
36.4 | % | 48.6 | % | ||||
Adjustment: | ||||||||
Stock-based compensation expense
|
1,714 | 1,132 | ||||||
Ruud inventory step up
|
979 | - | ||||||
Non-GAAP Gross Profit
|
100,721 | 131,661 | ||||||
Non-GAAP gross margin percentage | 37.4 | % | 49.0 | % |
Non-GAAP Operating Income | ||||||||
Three Months Ended
|
||||||||
September 25,
2011
|
September 26,
2010
|
|||||||
GAAP operating income
|
$ | 13,387 | $ | 73,417 | ||||
GAAP operating income percentage
|
5.0 | % | 27.3 | % | ||||
Adjustments
|
||||||||
Stock-based compensation expense
|
11,440 | 8,004 | ||||||
Amortization of acquisition-related intangible assets
|
3,925 | 2,706 | ||||||
Ruud Lighting acquisition costs
|
3,069 | - | ||||||
Ruud Lighting finished goods inventory step up | 979 | - | ||||||
Total adjustments to GAAP operating income | 19,413 | 10,710 | ||||||
Non-GAAP operating income
|
32,800 | 84,127 | ||||||
Non-GAAP operating income percentage
|
12.2 | % | 31.3 | % | ||||
Non-GAAP Net Income | ||||||||
Three Months Ended
|
||||||||
September 25,
2011
|
September 26,
2010
|
|||||||
GAAP net income
|
12,819 | 58,036 | ||||||
Adjustments
|
||||||||
Stock-based compensation expense
|
11,440 | 8,004 | ||||||
Amortization of acquisition-related intangible assets
|
3,925 | 2,706 | ||||||
Ruud Lighting acquisition costs | 3,069 | - | ||||||
Ruud Lighting finished goods inventory step up | 979 | - | ||||||
Total adjustments to GAAP income before provision for income taxes
|
19,413 | 10,710 | ||||||
Income tax effect
|
(4,174 | ) | (2,463 | ) | ||||
Non-GAAP net income
|
28,058 | 66,283 | ||||||
Earnings per share:
|
||||||||
GAAP diluted net income per share
|
0.11 | 0.53 | ||||||
Non-GAAP diluted net income per share
|
0.25 | 0.60 | ||||||
Shares used in diluted net income per share calculation:
|
||||||||
GAAP shares used
|
112,543 | 109,617 | ||||||
Non-GAAP shares used
|
112,543 | 109,617 | ||||||
Free Cash Flow
|
||||||||
Three Months Ended
|
||||||||
September 25,
2011
|
September 26,
2010
|
|||||||
Cash flow from operations
|
41,645 | 88,518 | ||||||
Less: PP&E CapEx spending | 33,962 | 61,649 | ||||||
Total free cash flows
|
$ | 7,683 | $ | 26,869 |
CREE, INC.
|
||||||||
Additional Financial Information
|
||||||||
(in thousands)
|
||||||||
Stock-Based Compensation Expense
|
||||||||
Three Months Ended
|
||||||||
September 25,
2011
|
September 26,
2010
|
|||||||
(unaudited) | (unaudited) | |||||||
Cost of sales
|
1,714 | 1,132 | ||||||
Research and development | 2,428 | 1,815 | ||||||
Sales, general and administrative | 7,298 | 5,057 | ||||||
Total stock-based compensation in operating expense | 9,726 | 6,872 | ||||||
Total stock-based compensation expense | 11,440 | 8,004 | ||||||
Cash, Cash Equivalents and Short-Term Investments | ||||||||
September 25,
2011
|
June 26,
2011
|
|||||||
(unaudited) | ||||||||
Cash and cash equivalents | 139,173 | 390,598 | ||||||
Short-term investments | 493,055 | 695,199 | ||||||
Total cash, cash equivalents, and short-term investments
|
$ | 632,228 | $ | 1,085,797 |