Maxim Integrated Reports Results For The Fourth Quarter Of

Maxim Integrated Reports Results For The Fourth Quarter Of Fiscal 2019, Increases Dividend By 4%

- Revenue: $557 million

SAN JOSE, Calif., July 30, 2019 — (PRNewswire) — Maxim Integrated Products, Inc. (NASDAQ: MXIM) reported net revenue of $557 million for its fourth quarter of fiscal 2019 ended June 29, 2019, a 3% increase from the $542 million revenue recorded in the prior quarter, and a 12% decrease from the same quarter of last year.

Logo for Maxim Integrated Products Inc. (PRNewsfoto/Maxim Integrated)

"Our June quarter results met our expectations, while we lowered both internal and distribution channel inventory. Given the soft business environment, we will continue to tightly manage inventory and spending in the September quarter," said Tunc Doluca, President and Chief Executive Officer. "Today, we are announcing a 4% increase in our dividend, reflecting our commitment to return cash to shareholders and confidence in our long-term outlook."

Fiscal Year 2019 Fourth Quarter Results
Based on Generally Accepted Accounting Principles (GAAP), diluted earnings per share in the June quarter was $1.33, which benefitted from a $204 million tax reserve release. GAAP earnings per share, excluding special items was $0.57. An analysis of GAAP versus GAAP excluding special items is provided in this press release.

Cash Flow Items
At the end of the fourth quarter of fiscal 2019, total cash, cash equivalents and short-term investments were $1.9 billion, flat from the prior quarter.

Notable items included:

Cash flow from operations: $237 million
Capital expenditures: $31 million
Dividends paid: $125 million ($0.46 per share)
Stock repurchases: $102 million

Trailing twelve months free cash flow was $793 million. Free cash flow is a non-GAAP measure and is defined by cash flow from operations less capital expenditures.

Business Outlook
The Company's 90-day backlog at the beginning of the September 2019 quarter was $391 million. Based on the beginning backlog and expected turns, our results for the September 2019 quarter are forecasted to be as follows:

Revenue: $510 to $550 million
Gross Margin: 62% to 64% GAAP (63% to 65% excluding special items)
EPS: $0.45 to $0.51 GAAP ($0.46 to $0.52 excluding special items)

Maxim Integrated's business outlook does not include the potential impact of any special items related to restructuring activity, acquisitions, or other business combinations that may be completed during the quarter.

Dividend
Our Board of Directors approved a 4% increase in the quarterly dividend. A cash dividend of $0.48 per share will be paid on September 13, 2019, to stockholders of record on August 29, 2019.

Conference Call
Maxim Integrated has scheduled a conference call on July 30 at 2:00 p.m. Pacific Time to discuss its financial results for the fourth quarter of fiscal 2019 and its business outlook. This call will be webcast by Shareholder.com and can be accessed at the Company's website at investor.maximintegrated.com.

A presentation summarizing financial information to be discussed on the conference call is posted at investor.maximintegrated.com.


CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

	Three Months Ended			Year Ended
	June 29,	March 30,	June 30,	June 29,	June 30,
	2019	2019	2018	2019	2018
	(in thousands, except per share data)
Net revenues	$ 556,545	$ 542,383	$ 633,154	$ 2,314,329	$ 2,480,066
Cost of goods sold	200,154	201,552	214,486	813,823	853,945
Gross margin	356,391	340,831	418,668	1,500,506	1,626,121
Operating expenses:
Research and development	105,136	107,075	112,056	435,222	450,943
Selling, general and administrative	75,130	74,116	82,611	308,617	322,918
Intangible asset amortization	756	756	844	3,041	4,467
Impairment of long-lived assets	-	-	-	753	892
Severance and restructuring expenses	1,715	1,744	833	5,632	15,060
Other operating expenses (income), net	83	-	(71)	143	(1,607)
Total operating expenses (income), net	182,820	183,691	196,273	753,408	792,673
Operating income (loss)	173,571	157,140	222,395	747,098	833,448
Interest and other income (expense), net	4,079	3,318	1,305	7,323	(8,563)
Income before taxes	177,650	160,458	223,700	754,421	824,885
Provision (benefit) for income taxes (1) (2)	(189,908)	29,845	29,528	(73,065)	357,567
Net income	$ 367,558	$ 130,613	$ 194,172	$ 827,486	$ 467,318


Earnings per share:
Basic	$ 1.35	$ 0.48	$ 0.70	$ 3.01	$ 1.66
Diluted	$ 1.33	$ 0.47	$ 0.68	$ 2.97	$ 1.64

Shares used in the calculation of earnings per share:
Basic	272,382	273,221	279,304	274,966	280,979
Diluted	275,835	276,610	283,934	278,777	285,674

Dividends paid per share	$0.46	$0.46	$0.42	$1.84	$1.56


SCHEDULE OF SPECIAL ITEMS
(Unaudited)

	Three Months Ended			Year Ended
	June 29,	March 30,	June 30,	June 29,	June 30,
	2019	2019	2018	2019	2018
	(in thousands)
Cost of goods sold:
Intangible asset amortization	$ 4,038	$ 5,008	$ 11,759	$ 22,829	$ 46,064
Total	$ 4,038	$ 5,008	$ 11,759	$ 22,829	$ 46,064

Operating expenses:
Intangible asset amortization	$ 756	$ 756	$ 844	$ 3,041	$ 4,467
Impairment of long-lived assets	-	-	-	753	892
Severance and restructuring	1,715	1,744	833	5,632	15,060
Other operating expenses (income), net	83	-	(71)	143	(1,607)
Total	$ 2,554	$ 2,500	$ 1,606	$ 9,569	$ 18,812

Interest and other expense (income), net	$ (2,980)	$ (857)	$ (941)	$ (4,565)	$ (1,243)
Total	$ (2,980)	$ (857)	$ (941)	$ (4,565)	$ (1,243)

Provision (benefit) for income taxes
Impact of U.S. tax legislation (1)	$ 47,703	$ (1,056)	$ -	$ 68,729	$ 243,550
Impact of income tax audit settlements (2)	(251,599)	-	-	(251,599)	-
Total	$ (203,896)	$ (1,056)	$ -	$ (182,870)	$ 243,550

(1) Includes effect of U.S. tax legislation enacted on December 22, 2017.
(2) Includes effect of income tax audit settlements.

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