EX-99.1 2 a5321301ex991.txt IXYS CORPORATION EXHIBIT 99.1 Exhibit 99.1 IXYS Announces Record Revenues and Backlog In December Quarter SANTA CLARA, Calif.--(BUSINESS WIRE)--Jan. 30, 2007--IXYS Corporation (NASDAQ:IXYS) today reported net revenues of $72.3 million for the third fiscal quarter ended December 31, 2006, an increase of 19.8%, as compared with net revenues of $60.3 million for the same period in the prior fiscal year. This is the fourth consecutive quarter of revenue growth for the company, with the last two quarters being record revenue quarters. For the nine months ended December 31, 2006, IXYS reported net revenues of $211.9 million, an increase of 13.3% as compared with net revenues of $187.1 million for the same period in the prior fiscal year. "Our record revenue growth illustrates the strength of our business lines and our on-going customer relationships. Our future looks promising - as we have experienced the fourth consecutive quarter of record backlog," said Dr. Nathan Zommer, Chief Executive Officer of IXYS. "To maintain a competitive position, we continue to grow our top line, introducing new products in more markets while working closely with current customers to meet their power demands. Simultaneously, we are keeping a watchful eye on improving margins and reducing costs." 3Q Financial Highlights -- Record revenues of $72.3 million, marking the 4th consecutive quarter of revenue growth -- Record backlog of $105.6 million, up 3.4% from the 2nd quarter, and marking the 4th consecutive quarter of record backlog. -- Gross margins up sequentially from last quarter, at 31.1% versus 30.8% for the September 30, 2006 quarter. -- IXYS repurchased 787,000 shares for $7.5 million. Gross profit was $22.5 million, or 31.1% of net revenues for the quarter ended December 31, 2006, as compared to gross profit of $18.9 million, or 31.4% of net revenues for the same quarter in the prior fiscal year. Gross profit for the nine months ended December 31, 2006 was $66.5 million, or 31.4% of net revenues, as compared to gross profit of $61.3 million, or 32.8% of net revenues, for the same period in the prior fiscal year. Net loss for the quarter ended December 31, 2006 was $106,000 or $0.00 per diluted share, as compared to net loss of $47.1 million, or $1.40 per diluted share, for the same quarter in the prior fiscal year. Net income for the nine months ended December 31, 2006, was $28.0 million, or $0.80 per diluted share, as compared to net loss of $36.4 million, or $1.09 loss per diluted share, for the same period in the prior fiscal year. The United States Court of Appeals for the Federal Circuit (the "Appeals Court") recently denied IXYS' motion to stay the damage award and injunction issued by the United States District Court for Central California (the "District Court") in the patent infringement lawsuit filed by International Rectifier Corporation ("IRF"). Under the standard applicable to IXYS' motion, the Appeals Court would have granted the motion only if it had concluded that there was a "strong likelihood" that IXYS would prevail in its appeal. The fact that the Appeals Court did not draw such conclusion does not prejudice IXYS' appeal, which will continue. As there is no effective stay on the District Court's award of damages, IXYS has recognized the litigation provision, reflecting the impact of the District Court's decision, set forth in its statements for the quarter ended December 31, 2006. The products covered by the injunction represented less than 2% of IXYS' revenues in the 12 months ended December 31, 2006. Results for the quarter and the nine months ended December 31, 2006 included a tax effected accrual of $4.2 million and a tax effected partial reversal of previously accrued liabilities of $17.3 million, respectively, for litigation provision and related tax effects. Excluding the impact of these entries, net income for the quarter and the nine months ended December 31, 2006 would have been $0.12 per diluted share and $0.31 per diluted share, respectively. The company repurchased 787,000 IXYS shares for $7.5 million during the December quarter and 1,432,000 IXYS shares for $13.2 million during the nine months ended December 31, 2006. Chief Financial Officer Uzi Sasson stated, "We plan to continue buying back shares under our authorized stock buyback program." "The March quarter has historically been strong for our company and we expect this to be the case for the coming quarter. Therefore we project revenues in the March 2007 quarter to be between $73 million and $75 million," stated Mr. Sasson. About IXYS A power semiconductor company, IXYS develops power and RF semiconductors and control ICs that are used to improve power conversion efficiency in a range of applications, including telecommunication infrastructure, motor drives, medical systems and transportation. IXYS also produces digital and analog ICs that control flat panel displays, medical instruments and telecommunication products (i.e., VoIP). Since its inception in 1983, IXYS Corporation has been developing technology-driven products to improve power conversion efficiency. IXYS is a U.S. pioneer in the development of power semiconductors that effectively monitor electrical voltage to produce maximum effect with the least expenditure of energy. Diminishing natural resources, demand for cheap energy and environmental directives for energy efficiency represent a significant challenge. IXYS' power semiconductors and mixed-signal integrated circuits can play a vital role in reducing energy costs and consumption - as their products regulate the amount of energy utilized by everyday products. With a customer base of over 3,000 telecommunications, transportation, industrial, medical and consumer companies, IXYS is a leading provider of power semiconductors in the U.S. In the alternative and renewable energy industry, IXYS focuses on harnessing wind and solar power for conversion to the U.S. electrical power grid - one more way to avoid another 2003 blackout. In addition, IXYS' R&D teams also developed solar cell arrays and cards for charging portable batteries - with applications for traditional alkaline batteries, laptops, cell phones, RFID tags and sensors, to name a few. IXYS, and its subsidiary companies, offer a diversified product base that addresses worldwide needs for power conversion, electrical efficiency and renewable energy. Non-GAAP Financial Information Included above and within the attached schedules are certain non-GAAP financial figures. Management believes non-GAAP net income and non-GAAP net income per share are useful measures of operating performance because they exclude the impact of the litigation provision related to the IRF and LoJack Corporation litigations and the impact of various adjustments to deferred tax assets, which are in the nature of one-time events. However, these non-GAAP measures should be considered in addition to, not as a substitute for, or superior to net income and net income per share, or other financial measures prepared in accordance with GAAP. Safe Harbor Statement The foregoing press release contains forward-looking statements, including those related to our future, backlog, revenue growth, introduction of new products, margins, costs, the plan to continue buying back shares and our projection for revenues in the March 2007 quarter. Actual results may vary materially from those contained in the forward-looking statements, due to changes in customer delivery schedules, the cancellation of orders, an unanticipated decline in our business, an unexpected increase or leveling of our costs or reduced cash flows or delays or difficulties in introducing new products due to development problems or production constraints, among other things. Further information on other factors that could affect IXYS is detailed and included in IXYS' Form 10-Q for the fiscal quarter ended September 30, 2006, as filed with the Securities and Exchange Commission. IXYS undertakes no obligation to publicly release the results of any revisions to these forward-looking statements. Additional information may be obtained by visiting IXYS' website at http://www.ixys.com, or by contacting the company directly. IXYS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited) December 31, March 31, 2006 2006 ----------- --------- ASSETS Current assets: Cash and cash equivalents $ 61,315 $ 78,505 Accounts receivable, net 43,058 42,774 Other receivables 1,725 1,433 Inventories, net 88,551 60,357 Prepaid expenses and other current assets 1,706 2,688 Deferred income taxes 10,263 25,049 ----------- --------- Total current assets 206,618 210,806 Plant and equipment, net 46,537 40,049 Other assets 12,847 12,580 Deferred income taxes 16,978 16,552 ----------- --------- Total assets $282,980 $279,987 =========== ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of capitalized lease obligations $ 2,835 $ 2,255 Current portion of notes payable to bank 895 973 Accounts payable 24,550 20,259 Accrued expenses and other current liabilities 40,560 68,504 ----------- --------- Total current liabilities 68,840 91,991 Capitalized lease and other long term obligations, net of current portion 15,590 14,447 Pension liabilities 14,679 13,576 ----------- --------- Total liabilities 99,109 120,014 ----------- --------- Common stock 348 347 Additional paid-in capital 147,136 156,664 Notes receivable from stockholders - (59) Retained earnings (accumulated deficit) 27,364 (614) Accumulated other comprehensive income 9,023 3,635 ----------- --------- Stockholders' equity 183,871 159,973 ----------- --------- Total liabilities and stockholders' equity $282,980 $279,987 =========== ========= IXYS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) Three Months Ended Nine Months Ended December 31, December 31, -------------------- -------------------- 2006 2005 2006 2005 -------------------- -------------------- Net revenues $ 72,274 $ 60,336 $ 211,890 $ 187,062 Cost of goods sold 49,797 41,399 145,409 125,749 -------------------- -------------------- Gross profit 22,477 18,937 66,481 61,313 -------------------- -------------------- Operating expenses: Research, development and engineering 4,890 4,960 14,919 13,199 Selling, general and administrative 10,278 8,707 33,162 27,869 Litigation provision 6,906 51,500 (29,738) 51,500 -------------------- -------------------- Total operating expenses 22,074 65,167 18,343 92,568 -------------------- -------------------- Operating income (loss) 403 (46,230) 48,138 (31,255) Other (expense) income, net (863) 741 (1,507) 1,953 -------------------- -------------------- (Loss) Income before income tax provision (460) (45,489) 46,631 (29,302) (Benefit from) Provision for income tax expense (354) 1,601 18,653 7,104 -------------------- -------------------- Net (loss) income $ (106)$ (47,090) $ 27,978 $ (36,406) ==================== ==================== Net (loss) income per share - basic $ (0.00)$ (1.40) $ 0.83 $ (1.09) ==================== ==================== Weighted average shares used in per share calculation - basic 33,264 33,593 33,793 33,514 ==================== ==================== Net (loss) income per share - diluted $ (0.00)$ (1.40) $ 0.80 $ (1.09) ==================== ==================== Weighted average shares used in per share calculation - diluted 33,264 33,593 35,072 33,514 ==================== ==================== GAAP reconciliation to non-GAAP (In thousands, except per share amounts) Quarter Ended Nine Months Ended December 31, December 31, December 31, December 31, 2006 2005 2006 2005 --------------------------------------------------- Net (loss) income, as reported (GAAP) $ (106) $ (47,090) $ 27,978 $(36,406) Adjustments to GAAP net income: Litigation provision and related tax effects 4,152 51,500 (17,277) 51,500 ------------ ------------ ------------ ------------ Non-GAAP net income $ 4,046 $ 4,410 $ 10,701 $ 15,094 ============ ============ ============ ============ Net (loss) income per share-basic, as reported (GAAP) $ - $ (1.40) $ 0.83 $ (1.09) Adjustments to GAAP net income per share-basic: Litigation provision and related tax effects 0.12 1.53 (0.51) 1.54 ------------ ------------ ------------ ------------ Net income per share-basic, (non-GAAP) $ 0.12 $ 0.13 $ 0.32 $ 0.45 ============ ============ ============ ============ Net (loss) income per share- diluted, as reported (GAAP) $ - $ (1.40) $ 0.80 $ (1.09) Adjustments to GAAP net income per share- diluted: Litigation provision and related tax effects(1) 0.12 1.52 (0.49) 1.51 ------------ ------------ ------------ ------------ Net income per share-diluted, (non-GAAP) $ 0.12 $ 0.12 $ 0.31 $ 0.42 ============ ============ ============ ============ Weighted average shares used in per share calculation Basic 33,264 33,593 33,793 33,514 Dilutive weighted average shares 1,279 2,136 1,279 2,313 ------------ ------------ ------------ ------------ Diluted 34,543 35,729 35,072 35,827 (1) For the quarter and nine months ended December, 2005, this includes the effect of additional dilutive shares considered for the purpose of Non-GAAP income per share-diluted. CONTACT: IXYS Corporation Uzi Sasson, CFO, 408-982-0700