MOUNTAIN VIEW, CA -- (MARKET WIRE) -- Oct 28, 2008 -- Actel Corporation (NASDAQ: ACTL) today announced net revenues of $53.2 million for the third quarter of 2008, down 8 percent from the second quarter of 2008 and up 11 percent from the third quarter of 2007.
Non-GAAP net income, which excludes stock-based compensation, option restatement expenses, and other nonrecurring adjustments, was $1.9 million for the third quarter of 2008 compared with $4.0 million for the second quarter of 2008 and $3.3 million for the third quarter of 2007. Non-GAAP earnings were $0.07 per diluted share for the third quarter of 2008 compared with $0.15 for the second quarter of 2008 and $0.12 for the third quarter of 2007.
Including stock-based compensation and other adjustments in accordance with generally accepted accounting principles (GAAP), Actel reported a net loss of $1.4 million, or ($0.05) per basic share, for the third quarter of 2008 compared with net income of $2.0 million, or $0.08 per diluted share, for the second quarter of 2008 and net income of $1.8 million, or $0.07 per diluted share, for the third quarter of 2007.
Gross margin was 58.0 percent for the third quarter of 2008 compared with 60.0 percent for the second quarter of 2008 and 59.7 percent for the third quarter of 2007.
Business Outlook - Fourth Quarter 2008
The company believes that fourth quarter 2008 revenues will be flat to four percent down sequentially. Gross margin is expected to be around 59 to 60 percent. Operating expenses are anticipated to come in at approximately $29 million, which excludes an estimated $1.8 million of stock-based compensation expense. Other income is expected to be about $1.5 million. The tax provision for the quarter is expected to be a credit of approximately $1 million. Outstanding fully diluted share count is expected to be about 25.9 million shares. The guidance for operating expenses does not include the ongoing amortization of intangibles and deferred compensation for the acquisition of Pigeon Point Systems of approximately $0.7 million or the one time charge for the reduction in force that is expected to be around $3 million.
Conference Call
A conference call to discuss third quarter results will be held Tuesday, October 28, 2008, at 2:00 p.m. Pacific Time. A live web cast and replay of the call will be available. Web cast and replay access information as well as financial and other statistical information can be found on Actel's web site, www.actel.com.
Non-GAAP Financial Measures
This release includes non-GAAP net income, non-GAAP net income per share data, and other non-GAAP line items from the Condensed Consolidated Statements of Operations, including total costs and expenses, income from operations, and income before tax provision. These measures are not in accordance with, or an alternative for, GAAP and may be different from non-GAAP measures used by other companies. These non-GAAP adjustments are provided to enhance the user's overall understanding of our operating performance. Actel believes that the presentation of these non-GAAP measures, when shown in conjunction with the corresponding GAAP measures, provides useful information to both management and investors regarding financial and business trends relating to Actel's financial condition and results of operations, in particular by excluding certain expense and income items that we believe are not indicative of our core operating results. Actel believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. In addition, since we have historically reported non-GAAP results to the investment community, we believe the inclusion of non-GAAP numbers provides consistency in our financial reporting.
About Actel
Actel is the leader in low-power and mixed-signal FPGAs, offering the most comprehensive portfolio of system and power management solutions. Power Matters. Learn more at www.actel.com.
Forward-Looking Statement Safe Harbor
The statements in the paragraph under the heading "Business Outlook - Fourth Quarter 2008" are forward-looking statements made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and should be read with the "Risk Factors" in Actel's most recent Form 10-Q, which can be found on Actel's web site, www.actel.com. Actel's quarterly revenues and operating results are subject to a multitude of risks, including general economic conditions and a variety of risks specific to Actel or characteristic of the semiconductor industry, such as fluctuating demand, intense competition, rapid technological change and related intellectual property and international trade issues, wafer and other supply shortages, and booking and shipment uncertainties. These and the other Risk Factors make it difficult for Actel to accurately project quarterly revenues and operating results, and could cause actual results to differ materially from those projected in the forward-looking statements. Any failure to meet expectations could cause the price of Actel's stock to decline significantly.
Editor's Note: The Actel name and logo are registered trademarks of Actel Corporation. All other trademarks and servicemarks are the property of their respective owners.
ACTEL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands except per share amounts)
Three Months Ended Nine Months Ended
------------------------------- --------------------
Oct. 5, Jul. 6, Sep. 30, Oct. 5, Sep. 30,
2008 2008 2007 2008 2007
--------- ---------- ---------- --------- ---------
Net revenues $ 53,215 $ 57,649 $ 47,880 $ 165,620 $ 145,274
Costs and expenses:
Cost of revenues 22,343 23,035 19,306 68,116 59,072
Research and
development 16,995 17,103 13,754 50,807 48,251
Selling, general,
and administrative 15,038 15,613 14,800 47,431 46,285
Amortization of
acquisition-
related intangibles 458 - - 458 -
--------- ---------- ---------- --------- ---------
Total costs and
expenses 54,834 55,751 47,860 166,812 153,608
--------- ---------- ---------- --------- ---------
Income (loss) from
operations (1,619) 1,898 20 (1,192) (8,334)
Interest income and
other, net 465 1,701 2,156 4,098 6,376
--------- ---------- ---------- --------- ---------
Income (loss) before
tax provision
(benefit) (1,154) 3,599 2,176 2,906 (1,958)
Tax provision
(benefit) 219 1,635 391 2,139 (351)
--------- ---------- ---------- --------- ---------
Net income (loss) $ (1,373) $ 1,964 $ 1,785 $ 767 $ (1,607)
========= ========== ========== ========= =========
Net income (loss)
per share:
Basic $ (0.05) $ 0.08 $ 0.07 $ 0.03 $ (0.06)
========= ========== ========== ========= =========
Diluted $ (0.05) $ 0.08 $ 0.07 $ 0.03 $ (0.06)
========= ========== ========== ========= =========
Shares used in
computing net
income (loss) per
share:
Basic 25,726 25,408 26,935 25,873 26,842
========= ========== ========== ========= =========
Diluted 25,726 26,155 27,234 26,267 26,842
========= ========== ========== ========= =========
RECONCILIATION OF NON-GAAP STATEMENTS OF
OPERATIONS TO GAAP STATEMENTS OF OPERATIONS
(Unaudited, in thousands)
Three Months Ended Nine Months Ended
-------------------------- -----------------
Oct. 5, Jul. 6, Sep. 30, Oct. 5, Sep. 30,
2008 2008 2007 2008 2007
-------- -------- -------- -------- --------
Cost and expenses:
Non-GAAP research and
development $ 15,408 $ 16,159 $ 12,917 $ 47,250 $ 41,342
Adjustments related to
stock based compensation
and other 1,587 944 837 3,557 6,909
-------- -------- -------- -------- --------
GAAP research and
development $ 16,995 $ 17,103 $ 13,754 $ 50,807 $ 48,251
======== ======== ======== ======== ========
Non-GAAP amortization of
acquisition-related
intangibles $ - $ - $ - $ - $ -
Adjustments related to
amortization of
acquisition-related
intangibles 458 - - 458 -
-------- -------- -------- -------- --------
GAAP amortization of
acquisition-related
intangibles $ 458 $ - $ - $ 458 $ -
======== ======== ======== ======== ========
Non-GAAP selling, general
and administrative $ 14,126 $ 14,437 $ 13,079 $ 42,752 $ 39,722
Adjustments related to stock
based compensation, option
investigation and other 912 1,176 1,721 4,679 6,563
-------- -------- -------- -------- --------
GAAP selling, general and
administrative $ 15,038 $ 15,613 $ 14,800 $ 47,431 $ 46,285
======== ======== ======== ======== ========
RECONCILIATION OF NON-GAAP STATEMENTS OF OPERATIONS TO GAAP STATEMENTS OF
OPERATIONS
(Unaudited, in thousands)
Three Months Ended Nine Months Ended
---------------------------- ------------------
Oct. 5, Jul. 6, Sep. 30, Oct. 5, Sep. 30,
2008 2008 2007 2008 2007
-------- -------- -------- -------- --------
Income (loss) from
operations:
Non-GAAP income from
operations $ 1,338 $ 4,018 $ 2,578 $ 7,502 $ 5,138
Adjustments related to
stock based
compensation and
other (2,957) (2,120) (2,558) (8,694) (13,472)
-------- -------- -------- -------- --------
GAAP (loss) income
from operations $ (1,619) $ 1,898 $ 20 $ (1,192) $ (8,334)
======== ======== ======== ======== ========
Interest income and
other, net:
Non-GAAP interest
income and other, net $ 1,338 $ 1,701 $ 2,156 $ 4,971 $ 6,376
Adjustments related to
investment impairment (873) - - (873) -
-------- -------- -------- -------- --------
GAAP interest income
and other, net $ 465 $ 1,701 $ 2,156 $ 4,098 $ 6,376
======== ======== ======== ======== ========
Income (loss) before tax
provision:
Non-GAAP income before
tax provision $ 2,676 $ 5,719 $ 4,734 $ 12,473 $ 11,514
Adjustments related to
stock based
compensation and
other (3,830) (2,120) (2,558) (9,567) (13,472)
-------- -------- -------- -------- --------
GAAP (loss) income
before tax provision $ (1,154) $ 3,599 $ 2,176 $ 2,906 $ (1,958)
======== ======== ======== ======== ========
RECONCILIATION OF NON-GAAP STATEMENTS OF OPERATIONS TO GAAP STATEMENTS OF
OPERATIONS
(Unaudited, in thousands except per share amounts)
Three Months Ended Nine Months Ended
---------------------------- ------------------
Oct. 5, Jul. 6, Sep. 30, Oct. 5, Sep. 30,
2008 2008 2007 2008 2007
-------- -------- -------- -------- --------
Net income (loss):
Non-GAAP net income $ 1,873 $ 4,003 $ 3,314 $ 8,731 $ 8,060
Adjustments related
to stock based
compensation other
and tax (3,246) (2,039) (1,529) (7,964) (9,667)
-------- -------- -------- -------- --------
GAAP net income
(loss) $ (1,373) $ 1,964 $ 1,785 $ 767 $ (1,607)
======== ======== ======== ======== ========
Net income (loss) per
share:
Basic:
Non-GAAP net income
per share $ 0.07 $ 0.16 $ 0.12 $ 0.34 $ 0.30
Adjustments related
to stock based
compensation other
and tax (0.12) (0.08) (0.05) (0.31) (0.36)
-------- -------- -------- -------- --------
GAAP net income
(loss) per share $ (0.05) $ 0.08 $ 0.07 $ 0.03 $ (0.06)
======== ======== ======== ======== ========
Diluted:
Non-GAAP net income
per share $ 0.07 $ 0.15 $ 0.12 $ 0.33 $ 0.29
Adjustments related
to stock based
compensation other
and tax (0.12) (0.07) (0.05) (0.30) (0.35)
-------- -------- -------- -------- --------
GAAP net income
(loss) per share $ (0.05) $ 0.08 $ 0.07 $ 0.03 $ (0.06)
======== ======== ======== ======== ========
ACTEL CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)
Oct. 5, Jan. 6,
2008 2008
--------- ---------
ASSETS (Unaudited)(Audited)
Current assets:
Cash and cash equivalents $ 25,832 $ 30,119
Short-term investments 107,559 152,609
Accounts receivable, net 29,588 18,116
Inventories 56,183 35,587
Deferred income taxes 19,331 19,350
Prepaid expenses and other current assets 7,757 10,259
--------- ---------
Total current assets 246,250 266,040
Property and equipment, net 35,442 25,417
Long-term investments 11,296 6,442
Goodwill 37,533 30,197
Deferred income taxes 17,245 16,082
Other assets, net 20,843 19,438
--------- ---------
$ 368,609 $ 363,616
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 22,439 $ 16,972
Accrued compensation and employee benefits 8,541 6,181
Accrued licenses 3,861 4,927
Other accrued liabilities 5,484 3,941
Deferred income on shipments to distributors 35,972 26,109
--------- ---------
Total current liabilities 76,297 58,130
Deferred compensation plan liability 4,682 5,479
Deferred rent liability 1,419 1,417
Accrued sabbatical compensation 3,380 3,380
Other long-term liabilities, net 5,424 3,718
--------- ---------
Total liabilities 91,202 72,124
Shareholders' equity 277,407 291,492
--------- ---------
$ 368,609 $ 363,616
========= =========
Contact: Jon Anderson Actel Corporation (650) 318-4445
