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Xilinx Announces First Quarter Fiscal 2008 Results; Operating Income Increases 23% Sequentially

Posted on: Thursday, 19 July 2007, 18:10 CDT

SAN JOSE, Calif., July 19 /PRNewswire-FirstCall/ -- Xilinx, Inc. today announced net revenues of $445.9 million in the first quarter of fiscal 2008, up 1% sequentially from the prior quarter and down 7% compared to the same quarter a year ago. First quarter net income was $84.3 million, or $0.28 per diluted share.

(Logo: http://www.newscom.com/cgi-bin/prnh/20020822/XLNXLOGO )

The Xilinx Board of Directors declared a quarterly cash dividend of $0.12 per outstanding share of common stock, payable on September 5, 2007 to all stockholders of record at the close of business on August 15, 2007.

Additional first quarter comparisons are represented in the chart below: GAAP Results (In millions, except EPS) Growth Rates Q1 FY 2008 Q4 FY 2007 Q1 FY 2007 Q-T-Q Y-T-Y Net revenues $445.9 $443.5 $481.4 1 % -7 % Operating income $97.5 $79.4 $93.1 23 % 5 % Net income $84.3 $87.6 $82.5 -4 % 2 % Diluted earnings per share $0.28 $0.27 $0.24 4 % 17 %

Sales from all geographies were in line with expectations with the exception of Europe. Weaker than anticipated European sales were driven primarily by customers in the Industrial and Data Processing Categories. Sales from Asia Pacific reached a record 29% of total sales, driven primarily by sales to communications customers in the region. New Product sales, which were slow in the prior quarter, increased 17% sequentially and represented 28% of total sales, up from 24% in the prior quarter. Sales from the Company's Virtex(TM)-5 FPGAs posted the strongest growth within this category.

"While sales growth was slightly lower than originally anticipated, I am pleased with our progress during the quarter in the areas of expense reduction and inventory management," said Wim Roelandts, Xilinx chief executive officer. "Expense controls contributed in part to an operating margin of 22% for the quarter, up from 18% in the prior quarter. Xilinx inventory days decreased 16 days to 79 days--the lowest level in over three years and a direct result of focused supply chain management."

Business Review -- June Quarter Fiscal 2008 -- Total inventory days at Xilinx and distribution were 101 days, down from 120 days last quarter. -- Accounts receivable days sales outstanding were 43, up from 37 in the prior quarter. -- Capital expenditures and depreciation were $16 million and $12 million, respectively. Net Revenues by Geography: Percentages Growth Rates Q1 Q4 Q1 FY 2008 FY 2007 FY 2007 Q-T-Q Y-T-Y North America 39 % 39 % 39 % 1 % -8 % Asia Pacific 29 % 26 % 26 % 12 % 4 % Europe 22 % 24 % 24 % -6 % -14 % Japan 10 % 11 % 11 % -12 % -16 % Net Revenues by End Market: Percentages Growth Rates Q1 Q4 Q1 FY 2008 FY 2007 FY 2007 Q-T-Q Y-T-Y Communications 45 % 44 % 49 % 3 % -15 % Industrial & Other 32 % 30 % 26 % 7 % 11 % Consumer & Automotive 15 % 16 % 15 % -6 % -6 % Data Processing 8 % 10 % 10 % -17 % -22 % Net Revenues by Product*: Percentages Growth Rates Q1 Q4 Q1 FY 2008 FY 2007 FY 2007 Q-T-Q Y-T-Y New 28 % 24 % 18 % 17 % 43 % Mainstream 50 % 52 % 59 % -5 % -22 % Base 16 % 18 % 17 % -6 % -12 % Support 6 % 6 % 6 % 0 % -6 % *Products are classified as follows: New Products: Virtex-5, Virtex-4, Spartan(TM)-3, and CoolRunner(TM)-II products Mainstream Products: Virtex-II, Spartan-II, CoolRunner and Virtex-E products Base Products: Virtex, Spartan, XC4000 and XC9500 products Support Products: Configuration solutions, HardWire, Software & Support/Services Highlights -- June Quarter Fiscal 2008: -- Xilinx continued to strengthen its 65-nm leadership and is now shipping on schedule all Virtex-5 LX, LXT and SXT devices. Additionally, Xilinx has produced working silicon for its FXT product, expected to be introduced later this fiscal year. -- Xilinx began shipping the low-cost Spartan-DSP series targeting applications such as video surveillance and wireless. This family offers lower power and higher performance at the lowest cost points in the FPGA industry versus competing DSP solutions. -- The Company recently introduced Integrated Software Environment (ISE(TM)) WebPACK(TM) 9.2i which offers software support for the Company's Virtex-5 FPGAs in addition to the latest Spartan-3A DSP platform FPGA. Also, following the successful launch of the PCI Express solution kit last quarter, Xilinx introduced two additional solution kits for gigabit Ethernet applications and memory interfaces. Solution kits simplify and accelerate broad adoption of advanced technologies by mainstream PLD designers. Business Outlook -- September Quarter Fiscal 2008 -- Revenues are expected to be flat to down slightly sequentially. -- Gross margin is expected to be between 62% and 63%. -- Operating expenses are expected to be up approximately 2% sequentially. -- Other income including interest expense is expected to be approximately $16 million. -- Tax rate is expected to be approximately 21%. -- Fully diluted share count is expected to be approximately flat at 303 million shares. Business Update -- September Quarter Fiscal 2008

The Company expects to issue a second quarter business update press release after the market closes on Thursday, September 6, 2007. Financial guidance to the investment community will be limited to the points mentioned in the business update document. Please sign up for a push email alert, which is available from our investor relations web site at http://www.investor.xilinx.com/.

This release contains forward-looking statements and projections. Forward-looking statements and projections can often be identified by the use of forward-looking words such as "may,""will,""could,""should,""expect,""believe,""anticipate,""estimate,""continue,""plan,""intend,""project" or other similar words. Undue reliance should not be placed on such forward-looking statements and projections, which speak only as of the date they are made. Actual events and results may differ materially from those in the forward-looking statements and are subject to risks and uncertainties including the general health of global economies as well as of the semiconductor industry, the health of our end markets and our customers' customers, our ability to forecast end customer demand, customer acceptance of our new products, the ability of our customers to manage their inventories, a high dependence on turns business, more customer volume discounts than expected, greater product mix changes than anticipated, fluctuations in manufacturing yields, our ability to deliver product in a timely manner, our ability to successfully manage production at multiple foundries, variability in wafer pricing, and other risk factors listed in our most recent Form 10-K.

About Xilinx

Xilinx, Inc. is the worldwide leader of programmable logic solutions. Additional information about Xilinx is available at http://www.xilinx.com/.

XILINX, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In thousands, except per share amounts) Three Months Ended June 30, July 1, March 31, 2007 2006 2007 Net revenues $445,912 $481,362 $443,472 Cost of revenues 168,478 192,059 168,041 Gross margin 277,434 289,303 275,431 Operating expenses: Research and development 87,870 97,582 98,476 Selling, general and administrative 90,199 94,418 95,657 Amortization of acquisition- related intangibles 1,897 2,031 1,940 Stock-based compensation related to prior years - 2,209 - Total operating expenses 179,966 196,240 196,073 Operating income 97,468 93,063 79,358 Impairment loss on investments - (437) - Interest and other, net 13,533 14,841 21,916 Income before income taxes 111,001 107,467 101,274 Provision for income taxes 26,723 24,976 13,648 Net income $84,278 $82,491 $87,626 Basic net income per common share $0.28 $0.24 $0.27 Diluted net income per common share $0.28 $0.24 $0.27 Cash dividends declared per common share $0.12 $0.09 $0.09 Common and equivalent shares used in computing net income per share amounts: Basic 297,720 341,853 325,115 Diluted 303,198 348,988 330,243 XILINX, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) June 30, March 31, 2007 2007 (Unaudited) (1) ASSETS Current assets Cash, cash equivalents and short-term investments $1,202,001 $1,137,915 Accounts receivable, net 208,392 182,295 Inventories 145,623 174,572 Deferred tax assets and other current assets 192,592 205,320 Total current assets 1,748,608 1,700,102 Net property, plant and equipment 416,189 413,036 Long-term investments 729,945 675,713 Investment in United Microelectronics Corporation 69,396 67,050 Other assets 333,399 323,454 Total Assets $3,297,537 $3,179,355 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable and accrued liabilities $180,665 $214,317 Deferred income on shipments to distributors 98,180 89,052 Total current liabilities 278,845 303,369 Convertible debentures 998,798 999,597 Deferred tax liabilities 88,551 102,329 Other long-term liabilities 35,377 1,320 Stockholders' equity 1,895,966 1,772,740 Total Liabilities and Stockholders' Equity $3,297,537 $3,179,355 (1) Derived from audited financial statements XILINX, INC. SUPPLEMENTAL FINANCIAL INFORMATION (Unaudited) (In thousands) Three Months Ended June 30, July 1, March 31, 2007 2006 2007 SELECTED CASH FLOW INFORMATION: Depreciation $12,446 $12,684 $17,895 Amortization 4,605 4,486 4,536 Stock-based compensation 16,521 26,808 20,135 Net cash provided by operating activities 126,324 153,265 105,633 Purchases of property, plant and equipment (15,599) (12,958) (63,183) Payment of dividends to stockholders (35,718) (30,830) (29,613) Repurchases of common stock - (125,000) (1,030,000) Proceeds from issuance of common stock to employees and excess tax benefit 48,046 37,562 51,376 STOCK-BASED COMPENSATION INCLUDED IN: Cost of revenues $2,171 $3,642 $1,985 Research and development 7,301 12,364 9,407 Selling, general and administrative 7,048 10,802 8,742 Investor Relations Contact: Lori Owen Xilinx, Inc. (408) 879-6911 ir@xilinx.com #0790

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Xilinx, Inc.

CONTACT: Investor Relations, Lori Owen of Xilinx, Inc., +1-408-879-6911,ir@xilinx.com

Web site: http://www.xilinx.com/

Source: PRNewswire-FirstCall

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