Synaptics Reports Fourth Quarter and Fiscal 2012 Results
SANTA CLARA, Calif., Aug. 2, 2012 /PRNewswire/ — Synaptics (NASDAQ: SYNA), a leading developer of human interface solutions for mobile computing, communications, and entertainment devices, today reported financial results for its fourth quarter and year ended June 30, 2012.
The Company also announced in separate press releases today that it has acquired Pacinian Corporation and the Video Display Operation of Integrated Device Technology and is also ushering in a new era of human interaction solutions for mobile computing devices with its revolutionary ForcePad(TM), ThinTouch(TM) Technology, and expanded ClearPad(TM) capabilities.
Net revenue for fiscal 2012 was $548.2 million compared with $598.5 million for fiscal 2011. Net income for fiscal 2012 was $54.1 million, or $1.57 per diluted share, compared with $63.8 million, or $1.80 per diluted share, for fiscal 2011.
Non-GAAP net income for fiscal 2012 was $78.6 million, or $2.28 per diluted share, compared with non-GAAP net income and diluted earnings per share for fiscal 2011 of $88.9 million and $2.51, respectively. (See attached table for a reconciliation of GAAP to non-GAAP results.)
Net revenue for the fourth quarter of fiscal 2012 was $137.6 million compared with $143.4 million for the comparable quarter last year. Net income for the fourth quarter of fiscal 2012 was $12.3 million, or $0.36 per diluted share, compared with net income of $13.9 million, or $0.40 per diluted share, for the comparable quarter last year.
Non-GAAP net income for the fourth quarter of fiscal 2012 was $18.6 million, or $0.54 per diluted share, compared with non-GAAP net income of $19.8 million, or $0.57 per diluted share, for the fourth quarter of fiscal 2011. (See attached table for a reconciliation of GAAP to non-GAAP results.)
“We are pleased with our fiscal 2012 performance, particularly against a backdrop of challenging market conditions,” stated Rick Bergman, President and CEO. “During the year, we strengthened our leadership position in our key markets, broadened and enhanced our solutions portfolio and our ability to scale to meet the opportunities in front of us, and continued to lay the foundation for long-term growth, as evidenced by today’s product and acquisition announcements.”
Fourth Quarter 2012 Business Metrics
- Revenue mix from PC and non-PC applications was approximately 56% and 44%, respectively.
- PC revenue totaled $77.1 million, a decrease of 1% year-over-year.
- Non-PC revenue totaled $60.5 million, a decrease of 8% year-over-year, primarily reflecting mobile phone touchscreen applications. Mobile unit volume continued to grow substantially with revenue impacted by the product mix transition from modules to lower priced, higher gross margin chip and tail touchscreen solutions.
- Non-GAAP gross margin was 46.2%, an increase of 380 basis points year-over-year.
- Non-GAAP operating margin was 17.3%, up 20 basis points year-over-year.
Cash at June 30, 2012 totaled $305.0 million. Cash flow from operations for the fourth quarter of fiscal 2012 was $21.7 million, and the Company used $28.2 million to repurchase one million shares of common stock. Cash flow from operations for the fiscal year was $101.4 million, and $61.7 million was used to repurchase 2.4 million shares of common stock.
Kathy Bayless, CFO, added, ” Considering our backlog of approximately $50.0 million, customer forecasts, and the resulting expected product mix, we anticipate revenue to be in the range of $120.0 million to $128.0 million for the September quarter. We expect PC revenue to be down on a sequential basis, reflecting a soft PC environment and the timing difference between our sell-in and OEM sell-through, as well as lower revenue from mobile applications due to the soft global market.”
Mr. Bergman added, “Looking ahead, we believe we are making the right investments at the right time and are very well positioned as the world’s leading human interface company based on our unparalleled touch capabilities and advanced technology roadmap. Despite the near-term macroeconomic and product-transition based headwinds in our markets, we expect to return to modest annual revenue growth in fiscal 2013 and look forward to another year of progress and innovation.”
Earnings Call Information
The Synaptics fourth quarter and fiscal 2012 teleconference and webcast is scheduled to begin at 2:00 p.m., Pacific Time, on Thursday, August 2, 2012, during which the company will provide forward-looking information. To participate on the live call, analysts and investors should dial 877-941-1427 at least ten minutes prior to the call. Synaptics will also offer a live and archived webcast of the conference call, accessible from the “Investor Relations” section of the company’s Web site at www.synaptics.com.
About Synaptics Incorporated
Synaptics delivers innovative touch solutions for intelligent devices. As a leading developer of human interface solutions for the mobile computing, communications, and entertainment markets, Synaptics solutions enhance the user experience. The ClearPad touchscreen product family supports devices ranging from entry-level mobile phones to tablets. The TouchPad(TM) family, including ClickPad(TM), is integrated into the majority of today’s notebook PCs. Synaptics has shipped over one billion capacitive touch solutions to date. (NASDAQ: SYNA) www.synaptics.com
Synaptics, ClearPad, TouchPad, ClickPad, ForcePad, ThinTouch, and the Synaptics logo are trademarks of Synaptics in the United States and/or other countries. All other marks are the property of their respective owners.
Use of Non-GAAP Financial Information
In evaluating its business, Synaptics considers and uses net income excluding share-based compensation and unusual or non-recurring items as a supplemental measure of operating performance. Net income excluding share-based compensation and unusual or non-recurring items is not a measurement of the company’s financial performance under GAAP and should not be considered as an alternative to GAAP net income. The company presents net income excluding share-based compensation and unusual or non-recurring items because it considers it an important supplemental measure of its performance. The company believes this measure facilitates operating performance comparisons from period to period by eliminating potential differences in net income caused by the existence and timing of share-based compensation charges and unusual or non-recurring items. Net income excluding share-based compensation and unusual or non-recurring items has limitations as an analytical tool and should not be considered in isolation or as a substitute for the company’s GAAP net income. The principal limitations of this measure are that it does not reflect the company’s actual expenses and may thus have the effect of inflating its net income and net income per share.
Forward-Looking Statements
This press release contains “forward-looking” statements about Synaptics, as that term is defined under the federal securities laws. Synaptics intends such forward-looking statements to be subject to the safe harbor created by those laws. Such forward-looking statements include, but are not limited to, statements regarding the company’s statement that it is ushering in a new era of human interaction solutions for mobile computing devices with its revolutionary ForcePad, ThinTouch Technology, and expanded ClearPad capabilities; the company’s belief that it has strengthened its leadership position in its key markets, broadened and enhanced its solutions portfolio and its ability to scale to meet the opportunities in front of it, and continued to lay the foundation for long-term growth, as evidenced by its recent product and acquisition announcements; the company’s anticipated revenue for the September quarter, including its expectations that PC revenue to be down on a sequential basis, reflecting a soft PC environment and the timing difference between its sell-in and OEM sell-through, as well as lower revenue from mobile applications due to the soft global market; the company’s belief that it is making the right investments at the right time and it is very well-positioned as the world’s leading human interface company based on its unparalleled touch capabilities and advanced technology roadmap; and the company’s expectation of a return to modest annual revenue growth in fiscal 2013. Synaptics cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements contained herein. Such factors include, but are not limited to, (a) demand for Synaptics’ products, (b) market demand for OEMs’ products using Synaptics’ solutions, (c) changing market demand trends in the markets Synaptics serves, (d) the success of Synaptics’ customers’ products that utilize Synaptics’ product solutions, (e) the development and launch cycles of Synaptics’ customers’ products, (f) market pressures on selling prices, (g) changes in product mix, (h) the market acceptance of Synaptics’ product solutions compared with competitors’ solutions, (i) general economic conditions, including consumer confidence and demand, and (j) other risks as identified from time to time in Synaptics’ SEC reports, including Quarterly Reports on Form 10-Q and the Annual Report on Form 10-K for the fiscal year ended June 30, 2011. All forward-looking statements are based on information available to Synaptics on the date hereof, and Synaptics assumes no obligation to update such statements.
For more information contact:
Jennifer Jarman
The Blueshirt Group
415-217-5866
jennifer@blueshirtgroup.com
(Tables to Follow)
SYNAPTICS INCORPORATED
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
June 30, June 30,
2012 2011
---- ----
Assets
Current assets:
Cash and cash equivalents $305,005 $247,153
Receivables, net of allowances of $567 and $709,
respectively 104,140 93,808
Inventories 31,667 28,850
Prepaid expenses and other current assets 5,365 4,373
-----
Total current assets 446,177 374,184
Property and equipment, net 24,903 26,222
Goodwill 18,995 1,927
Purchased intangibles 12,800 -
Non-current auction rate securities 15,321 25,876
Other assets 23,309 27,992
------ ------
Total assets $541,505 $456,201
======== ========
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $55,220 $44,930
Accrued compensation 12,642 13,210
Income taxes payable 11,221 11,808
Other accrued liabilities 26,515 22,813
------
Total current liabilities 105,598 92,761
Convertible senior subordinated notes 2,305 2,305
Other liabilities 36,812 21,142
Commitments and contingencies
Stockholders' equity:
Preferred stock;
$.001 par value; 10,000,000 shares authorized;
no shares issued and outstanding - -
Common stock;
$.001 par value; 120,000,000 shares authorized;
48,680,348 and 46,832,208 shares issued, and 32,896,256 and 33,465,732 shares outstanding,
respectively
49 47
Additional paid in capital 471,569 406,653
Less: 15,784,092 and 13,366,476 treasury
shares, respectively, at cost (413,885) (352,142)
Retained earnings 337,059 282,915
Accumulated other comprehensive income 1,998 2,520
-----
Total stockholders' equity 396,790 339,993
------- -------
Total liabilities and stockholders' equity $541,505 $456,201
======== ========
SYNAPTICS INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
Three Months Ended Twelve Months Ended
June 30, June 30,
-------- --------
2012 2011 2012 2011
---- ---- ---- ----
Net revenue $137,607 $143,366 $548,228 $598,538
Cost of revenue (1) 74,203 82,778 292,661 352,468
------ ------ ------- -------
Gross margin 63,404 60,588 255,567 246,070
Operating expenses
Research and development (1) 30,476 27,487 117,954 105,003
Selling, general, and administrative (1) 17,584 16,799 70,045 68,549
------------
Total operating expenses 48,060 44,286 187,999 173,552
------ ------ ------- -------
Operating income 15,344 16,302 67,568 72,518
Interest income 240 232 922 911
Interest expense (4) (4) (17) (17)
Impairment recovery on investments, net 18 39 77 59
--- --- --- ---
Income before income taxes 15,598 16,569 68,550 73,471
Provision for income taxes (2) 3,298 2,646 14,406 9,675
Net income $12,300 $13,923 $54,144 $63,796
======= ======= ======= =======
Net income per share:
Basic $0.37 $0.41 $1.64 $1.87
=====
Diluted $0.36 $0.40 $1.57 $1.80
=======
Shares used in computing net income per share:
Basic 33,321 33,816 33,030 34,042
=====
Diluted 34,505 35,011 34,435 35,454
=======
(1) Includes share-based compensation charges of:
Cost of revenue $226 $262 $1,129 $1,294
Research and development 4,300 3,694 15,509 13,823
Selling, general, and administrative 3,972 4,261 17,523 18,808
----- ----- ------ ------
$8,498 $8,217 $34,161 $33,925
====== ====== ======= =======
(2) Includes tax benefit for share-based compensation charges of:
$2,170 $2,319 $9,589 $9,745
====== ====== ====== ======
Non-GAAP net income per share:
Basic $0.56 $0.58 $2.38 $2.61
===== ===== ===== =====
Diluted $0.54 $0.57 $2.28 $2.51
===== ===== ===== =====
SYNAPTICS INCORPORATED
Reconciliation of Non-GAAP Net Income and Net Income Per Share
(In thousands, except per share data)
(Unaudited)
Three Months Ended Twelve Months Ended
June 30, June 30,
-------- --------
2012 2011 2012 2011
---- ---- ---- ----
Reported net income $12,300 $13,923 $54,144 $63,796
======= ======= ======= =======
Non-GAAP adjustments (net of tax):
Non-
recurring
CEO
resignation
costs - - - 1,006
Impairment
recovery on
investments,
net (18) (39) (77) (59)
Share-based
compensation 6,328 5,898 24,572 24,180
Non-GAAP basic and diluted net income $18,610 $19,782 $78,639 $88,923
------- ------- ------- -------
Non-GAAP net income per share:
Basic $0.56 $0.58 $2.38 $2.61
Diluted $0.54 $0.57 $2.28 $2.51
SOURCE Synaptics Inc.
