-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Pt/3Q+iKvMgXwIOYa8s01PNAcKh3o2awauzeSu6rtldMcPzlufM4RE/nF+i3+QD1 d+UtzlghsvGuljrwPy3mwg== 0000093384-03-000109.txt : 20030918 0000093384-03-000109.hdr.sgml : 20030918 20030918141406 ACCESSION NUMBER: 0000093384-03-000109 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030916 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20030918 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STANDARD MICROSYSTEMS CORP CENTRAL INDEX KEY: 0000093384 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 112234952 STATE OF INCORPORATION: DE FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-07422 FILM NUMBER: 03901087 BUSINESS ADDRESS: STREET 1: 80 ARKAY DRIVE CITY: HAUPPAUGE STATE: NY ZIP: 11934 BUSINESS PHONE: 5164342904 MAIL ADDRESS: STREET 1: 80 ARKAY DR CITY: HAUPPAUGE STATE: NY ZIP: 11934 8-K 1 form_8k-q2fy04.txt Q2FY04EARNINGS RELEASE SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 __________________________________ FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported) - September 18, 2003 __________________________________ STANDARD MICROSYSTEMS CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 0-7422 11-2234952 (State or other jurisdiction of (Commission File (I.R.S. Employer incorporation or organization) Number) Identification No.) 80 Arkay Drive, Hauppauge, New York 11788 (Address of principal executive offices) (Zip Code) (631) 435-6000 (Registrant's telephone number, including area code) ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS ( c ) Exhibits - The following exhibit is furnished as part of this Report: 99.1 Press release issued by Standard Microsystems Corporation dated September 16, 2003. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION On September 16, 2003, Standard Microsystems Corporation issued a press release announcing second quarter fiscal 2004 operating results. A copy of the press release is attached as Exhibit 99.1. The information in Exhibit 99.1 attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended. ________________________________________________________________________________ SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. STANDARD MICROSYSTEMS CORPORATION (Registrant) Date: September 18, 2003 By: /s/ ANDREW M. CAGGIA ---------------------------------- Andrew M. Caggia Senior Vice President and Chief Financial Officer, and Director (Principal Financial Officer) ________________________________________________________________________________ Exhibit Index Exhibit No. Description - ----------- ----------- 99.1 Press release dated September 16, 2003, announcing second quarter fiscal 2004 operating results. EX-99.1 3 exhibit_99-1.txt 9/16/03 SMSC EARNINGS RELEASE-2ND QTRFY04 Exhibit 99.1 SMSC REPORTS 26% YEAR-OVER-YEAR GROWTH IN SECOND QUARTER FISCAL 2004 REVENUES Posts More than 150% Increase in Income from Continuing Operations Per Share From Year-Ago Period Raises Fiscal 2004 Earnings Estimate by 25%, Exclusive of Income from Special IP Payments Hauppauge, NY - September 16, 2003 - Standard Microsystems Corporation (Nasdaq: SMSC) today announced that revenues for the second quarter ended August 31, 2003 of $48.3 million exceeded prior Company estimates, and increased by 26% compared to $38.3 million in the second quarter of fiscal 2003. This represents the sixth consecutive quarter of sequential revenue increases. Gross profit percentage for the second quarter of fiscal 2004 was 44.5% compared to 44.7% in the previous year's second quarter. Research and development expenses for the quarter were $9.3 million, compared to $7.8 million in the year-ago quarter, and selling, general and administrative expenses were $10.0 million, compared to $8.7 million in last year's second quarter. The year-over-year increases in operating expenses primarily reflect investments in engineering and marketing personnel and generally higher expenses associated with increasing revenues. Operating income in the second quarter of fiscal 2004 was $1.9 million, versus $0.2 million in the year-ago period. Second quarter income from continuing operations was $1.5 million, or $0.08 per share, an increase of over 150%, compared to $0.6 million, or $0.03 per share, in the year-ago quarter. Cash and short-term investments at the end of the second quarter of fiscal 2004 were $122.6 million, up from $120.9 million at May 31, 2003. The Company has no bank debt, and book value per share as of August 31, 2003 was $12.41. "We are very pleased with our second quarter results. Boosted by strong demand across all major product lines, revenues significantly exceeded prior Company expectations," said Steven J. Bilodeau, Chairman and Chief Executive Officer. "In total, revenues from desktop and mobile products grew by 26% versus last year's second quarter." Mr. Bilodeau added, "The aggregate sales of SMSC's non-PC products, including our USB and networking products, also showed 26% growth, indicating the momentum we are gaining in our product diversification strategy." BUSINESS OUTLOOK FOR SMSC: On September 8, 2003, SMSC and Intel Corporation (Intel) announced that the two companies had enhanced their intellectual property and business relationships. As part of this agreement, SMSC expects to receive a $20 million payment from Intel in the third quarter of fiscal 2004 and another $2.5 million payment in the fourth quarter. For the third quarter of fiscal 2004, SMSC expects revenues to be approximately $70 million, including the special $20 million payment. Excluding that payment, revenues are expected to increase by approximately 23% year-over-year. Gross profit percentage is expected to be approximately 60% in the third quarter, including the impact of the special payment, or approximately 44% without that impact. Research and development expenses are expected to be between $9.5 million and $10.0 million, and selling, general and administrative expenses are expected to be between $10.5 million and $11.0 million. Amortization of acquired intangibles is expected to be $317 thousand. The effective tax rate is estimated to be approximately 36% in the third quarter, and the Company expects third quarter income from continuing operations to be between $0.75 and $0.80 per share, including the special payment, and up slightly from the second quarter of fiscal 2004 without that payment. For fiscal 2004, SMSC expects revenues to increase by more than 35%, as compared with fiscal 2003, including the $22.5 million of special payments, or by 20% to 25% without those payments. This significantly exceeds previous guidance, which indicated a more than 15% revenue increase over the prior year. Gross profit percentage, including the special payments, is expected to exceed 50%. Without the impact of the payments, gross profit is expected to be approximately 45%. Research and development expenses are expected to be between $37 million and $38 million, and selling, general and administrative expenses are expected to be between $40 million and $41 million. Amortization of acquired intangibles is expected to be approximately $1.3 million. The effective tax rate for fiscal 2004 will be approximately 35%. Income from continuing operations for fiscal 2004, including the $22.5 million of special payments, is expected to be between $1.05 and $1.15 per share, or between $0.30 and $0.35 per share without the special payments, an increase of approximately 25% from prior Company estimates. Prior Company guidance called for income from continuing operations to be in the range of $0.24 to $0.28 per share. Andrew M. Caggia, Senior Vice President and Chief Financial Officer said, "The investments we have made in new product development have enabled SMSC to gain measurable traction in a wide range of emerging markets. As a result of this success, coupled with increasing revenues in businesses we have long served, SMSC is looking forward to its seventh sequential quarter of increasing revenues and expects to continue to outperform the industry's growth during this fiscal year." About SMSC: SMSC provides Real World Connectivity(TM) solutions for high-speed communication and computing applications. Leveraging a broad intellectual property portfolio, the Company thrives at the intersection of software, silicon and customized OEM applications. Through the integration of its leading-edge digital, mixed-signal and analog functionality and software expertise, SMSC delivers complete solutions that monitor and manage computing systems and connect peripherals to computers and to one another. The Company is the world's leading provider of Advanced Input/Output (I/O) hardware and software solutions ranging from legacy PC I/O to leading-edge system management functionality. Through high-speed serial interfaces, including USB 2.0 and embedded Ethernet, SMSC delivers faster and higher-bandwidth peripheral connections for a wide range of products such as memory card readers, mass storage devices, digital cameras and keyboards and enables innovative high-speed networking functionality for consumer electronics, set-top boxes, printers, car navigation systems, cellular base stations, and more. SMSC, a fabless semiconductor supplier, is based in Hauppauge, New York and maintains offices worldwide, including locations in North America, Taiwan, Japan, Korea, China and Europe. SMSC operates engineering design centers in Phoenix, AZ, Tucson, AZ, Hauppauge, NY and Austin, TX. More information about the Company is available on the World Wide Web at http://www.smsc.com. Standard Microsystems and SMSC are registered trademarks, and Real World Connectivity is a trademark, of Standard Microsystems Corporation. Product names and company names are trademarks of their respective holders. Forward Looking Statements: Except for historical information contained herein, the matters discussed in this announcement are forward-looking statements about expected future events and financial and operating results that involve risks and uncertainties. These include the timely development and market acceptance of new products; the impact of competitive products and pricing; the effect of changing economic conditions in domestic and international markets; changes in customer order patterns, including loss of key customers, order cancellations or reduced bookings; and excess or obsolete inventory and variations in inventory valuation, among others. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations and may not reflect the potential impact of any future acquisitions, mergers or divestitures. SMSC competes in the semiconductor industry, which has historically been characterized by intense competition, rapid technological change, cyclical market patterns, price erosion and periods of mismatched supply and demand. In addition, sales of many of the Company's products depend largely on sales of personal computers and peripheral devices, and reductions in the rate of growth of the PC and Embedded markets could adversely affect its operating results. SMSC conducts business outside the United States and is subject to tariff and import regulations and currency fluctuations, which may have an effect on its business. All forward-looking statements speak only as of the date hereof and are based upon the information available to SMSC at this time. Such information is subject to change, and we will not necessarily inform you of such changes, except as required by law. These and other risks and uncertainties, including potential liability resulting from pending or future litigation, are detailed from time to time in the Company's reports filed with the SEC. Investors are advised to read the Company's Annual Report on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commission, particularly those sections entitled "Other Factors That May Affect Future Operating Results" for a more complete discussion of these and other risks and uncertainties. Contact: Carolynne Borders Director of Corporate Communications Standard Microsystems Corporation Voice: 631-435-6626 Fax: 631-273-5550 carolynne.borders@smsc.com STANDARD MICROSYSTEMS CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands) August 31, February 28, 2003 2003 ---- ---- Assets Current assets: Cash and cash equivalents $ 101,510 $ 90,025 Short-term investments 21,133 22,872 Accounts receivable, net 26,696 22,738 Inventories 21,535 17,644 Deferred income taxes 11,092 8,545 Other current assets 8,288 8,710 - ------------------------------------------------------------------------------- Total current assets 190,254 170,534 - ------------------------------------------------------------------------------- Property, plant and equipment, net 19,879 22,257 Goodwill 29,595 29,773 Intangible assets, net 5,331 6,008 Deferred income taxes 8,370 11,779 Other assets 5,412 7,598 - ------------------------------------------------------------------------------- $ 258,841 $ 247,949 =============================================================================== Liabilities and shareholders' equity Current liabilities: Accounts payable $ 12,590 $ 9,114 Deferred income on shipments to distributors 7,805 5,943 Accrued expenses, income taxes and other liabilities 9,679 9,838 - ------------------------------------------------------------------------------- Total current liabilities 30,074 24,895 - ------------------------------------------------------------------------------- Other liabilities 6,981 7,379 Minority interest in subsidiary 11,759 11,663 Shareholders' equity: Preferred stock - - Common stock 1,874 1,859 Additional paid-in capital 149,563 147,655 Retained earnings 80,691 77,492 Treasury stock, at cost (23,454) (23,454) Deferred stock-based compensation (2,125) (2,102) Accumulated other comprehensive income 3,478 2,562 - ------------------------------------------------------------------------------- Total shareholders' equity 210,027 204,012 - ------------------------------------------------------------------------------- $ 258,841 $ 247,949 ===============================================================================
STANDARD MICROSYSTEMS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share amounts) Three Months Ended Six Months Ended ---------------------------- ---------------------------- August 31, August 31, ---------------------------- ---------------------------- 2003 2002 2003 2002 ---- ---- ---- ---- Sales and revenues $ 48,289 $ 38,300 $ 91,010 $ 72,307 Cost of goods sold 26,783 21,189 48,842 40,124 - ------------------------------------------------------------------------------------------- ------------------------------ Gross profit 21,506 17,111 42,168 32,183 Operating expenses (income): Research and development 9,280 7,774 18,381 14,625 Selling, general and administrative 9,965 8,659 19,478 16,853 Amortization of intangible assets 317 447 677 447 Gains on real estate transactions - - (1,444) - - ------------------------------------------------------------------------------------------- ------------------------------ Income from operations 1,944 231 5,076 258 Interest income 391 533 834 1,114 Other expense, net (9) (7) (745) (22) - ------------------------------------------------------------------------------------------- ------------------------------ Income before provision for income taxes and minority interest 2,326 757 5,165 1,350 Provision for income taxes 785 197 1,680 351 Minority interest in net (loss) income of subsidiary 35 (8) 96 (2) - ------------------------------------------------------------------------------------------- ------------------------------ Income from continuing operations 1,506 568 3,389 1,001 Loss from discontinued operations (net of income tax benefits of $14, $145, $106, and $191) (26) (258) (190) (339) - ------------------------------------------------------------------------------------------- ------------------------------ Net income $ 1,480 $ 310 $ 3,199 $ 662 =========================================================================================== ============================== Basic net income per share: Income from continuing operations $ 0.09 $ 0.03 $ 0.20 $ 0.06 Loss from discontinued operations - (0.01) (0.01) (0.02) - ------------------------------------------------------------------------------------------- ------------------------------ Basic net income per share $ 0.09 $ 0.02 $ 0.19 $ 0.04 =========================================================================================== ============================== Diluted net income per share: Income from continuing operations $ 0.08 $ 0.03 $ 0.19 $ 0.06 Loss from discontinued operations - (0.01) (0.01) (0.02) - ------------------------------------------------------------------------------------------- ------------------------------ Diluted net income per share $ 0.08 $ 0.02 $ 0.18 $ 0.04 =========================================================================================== ============================== Weighted average common shares outstanding: Basic 16,863 16,631 16,830 16,365 Diluted 17,869 18,214 17,643 18,008
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