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Actel Corp (907687) SEC Filing 10-Q Quarterly report for the period ending Sunday, April 5, 2009

Actel Corp

CIK: 907687
     
Investor Contact:
  Media Contact:
Dirk Sodestrom
Actel Corporation
(650) 318-4795
  Anna del Rosario
Actel Corporation
(650) 318-4500

For Release: April 28, 2009 @ 1:30 P.M. PT

ACTEL ANNOUNCES FIRST QUARTER 2009 FINANCIAL RESULTS

Mountain View, Calif. – Actel Corporation (NASDAQ: ACTL) today announced net revenues of $48.5 million for the first quarter of 2009, down 12 percent from the first quarter of 2008 and down 8 percent from the fourth quarter of 2008.

Non-GAAP net income, which excludes stock-based compensation, expenses associated with a restructuring initiated during the first quarter, and other non-recurring adjustments, was $0.8 million for the first quarter of 2009 compared with $2.9 million for the first quarter of 2008 and $3.3 million for the fourth quarter of 2008.

Including stock-based compensation, expenses associated with the restructuring, and other non-recurring adjustments in accordance with generally accepted accounting principles (GAAP), Actel reported a net loss of ($3.0) million, or ($0.11) per basic share, for the first quarter of 2009 compared with a net income of $0.2 million, or $0.01 per diluted share, for the first quarter of 2008 and a net loss of ($12.5) million, or ($0.48) per basic share, for the fourth quarter of 2008. First quarter charges of $1.1 million for expenses associated with the restructuring adversely affected net income in accordance with GAAP for the first quarter of 2009.

Gross margin was 57.1 percent for the first quarter of 2009 compared with 58.5 percent for the first quarter of 2008 and 59.1 percent for the fourth quarter of 2008. Gross margin for the first quarter of 2009 was negatively impacted by a $1.5 million charge associated with low yield wafers.

Business Outlook – Second Quarter 2009

The Company believes that second quarter 2009 revenues will decline sequentially 1 percent to 7 percent. Gross margin is expected to be about 59 percent. Operating expenses are anticipated to come in at approximately $28 million, which excludes an estimated $1.8 million of stock-based compensation expense and $0.6 million associated with the acquisition of Pigeon Point Systems. Other income is expected to be about $1.2 million. The tax rate for the quarter is expected to be about 30 percent. Outstanding fully diluted share count is expected to be about 26.3 million shares.

Conference Call

A conference call to discuss first quarter results will be held Tuesday, April 28, 2009, 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.

Corporate Restructuring

Actel announced in January a company-wide restructuring plan to increase profitability. In conjunction with cost-reduction initiatives taken in the fourth quarter of 2008, the restructuring is expected to result in a quarterly reduction in expenses of approximately $6.5 million in the third quarter of 2010 compared with the third quarter of 2008. The Company estimates that approximately $5.5 million of the quarterly reductions will be in operating spending and that the balance of savings will be in cost of goods sold. The Company expects to record aggregate charges of $4.0 million to $4.5 million for severance and other costs related to the restructuring by the beginning of the third quarter of 2010, when the restructuring will be substantially complete.

Non-GAAP Adjustments and Reconciliation

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.

Forward-Looking Statements

The statements in the paragraphs under the headings “Corporate Restructuring” and “Business Outlook – Second Quarter 2009” 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 or 10-K, which can be found on Actel’s web site, www.actel.com. Actel’s anticipated results from its restructuring plan and its projected revenues and operating results for the second quarter of 2009 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 a failure to achieve the full projected results of the restructuring plan, 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. Actel undertakes no obligation to update any information contained in this press release.

About Actel

Actel is the leader in low-power FPGAs and mixed-signal FPGAs, offering the most comprehensive portfolio of system and power management solutions. Power Matters. Learn more at www.actel.com.

Editor’s Note: The Actel name and logo are registered trademarks of Actel Corporation.

1

ACTEL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except per share amounts)

                                 
                    Three Months Ended
            Apr. 5, 2009   Jan. 4, 2009   Apr. 6, 2008
      unaudited
  unaudited   unaudited
Net revenues
          $ 48,459     $ 52,786     $ 54,756  
Costs and expenses:
                               
Cost of revenues
            20,785       21,598       22,738  
Research and development
            16,393       14,851       16,709  
Selling, general, and administrative
            13,490       15,714       16,780  
Restructuring charges
            1,119       2,424        
Amortization of acquisition-related intangibles
            193 458       338        
 
                               
Total costs and expenses
            51,980       54,925       56,227  
 
                               
Loss from operations
            (3,521 )     (2,139 )     (1,471 )
Interest income and other, net
            1,752       1,335       1,932  
 
                               
Income (loss) before tax provision (benefit)
            (1,769 )     (804 )     461  
Tax provision
            1,187       11,688       285  
 
                               
Net income (loss)
          $ (2,956 )   $ (12,492 )   $ 176  
 
                               
Net income (loss) per share:
                               
Basic
          $ (0.11 )   $ (0.48 )   $ 0.01  
 
                               
Diluted
          $ (0.11 )   $ (0.48 )   $ 0.01  
 
                               
Shares used in computing net income (loss) per share:
                               
Basic
            26,027       25,784       26,487  
 
                               
Diluted
            26,027       25,784       26,677  
 
                               

2

RECONCILIATION OF NON-GAAP STATEMENTS OF OPERATIONS TO GAAP STATEMENTS OF OPERATIONS
(Unaudited, in thousands)

                                 
            Three Months Ended
            Apr. 5, 2009   Jan. 4, 2009   Apr. 6, 2008
Cost and expenses:
                               
Non-GAAP research and development
          $ 15,105     $ 13,511     $ 15,683  
Adjustments related to stock based compensation and other
            1,288       1,340       1,026  
 
                               
GAAP research and development
          $ 16,393     $ 14,851     $ 16,709  
 
                               
Non-GAAP restructuring charges
          $ -     $     $  
Adjustments related to restructuring
            1,119       2,424        
 
                               
GAAP restructuring charges
          $ 1,119     $ 2,424     $  
 
                               
Non-GAAP amortization of acquisition-related intangibles
          $     $     $ -  
Adjustments related to amortization of acquisition- related intangibles
            193       338       -  
 
                               
GAAP amortization of acquisition-related intangibles
          $ 193     $ 338     $ -  
 
                               
Non-GAAP selling, general and administrative
          $ 12,454     $ 14,347     $ 14,189  
Adjustments related to stock based compensation, option investigation and other
            1,036       1,367       2,591  
 
                               
GAAP selling, general and administrative
          $ 13,490     $ 15,714       16,780  
 
                               

3

RECONCILIATION OF NON-GAAP STATEMENTS OF OPERATIONS TO GAAP STATEMENTS OF OPERATIONS
(Unaudited, in thousands)

                                 
            Three Months Ended
            Apr. 5, 2009   Jan. 4, 2009   Apr. 6, 2008
Income (loss) from operations:
                               
Non-GAAP income from operations
          $ 115     $ 3,330     $ 2,146  
Adjustments related to stock based compensation and other
            (3,636 )     (5,469 )     (3,617 )
 
                               
GAAP loss from operations
          $ (3,521 )   $ (2,139 )   $ (1,471 )
 
                               
Interest income and other, net:
                               
Non-GAAP interest income and other, net
          $ 1,036     $ 1,335     $ 1,932  
Adjustments related to insurance reimbursement
            716              
 
                               
GAAP interest income and other, net
          $ 1,752     $ 1,335     $ 1,932  
 
                               
Income (loss) before tax provision:
                               
Non-GAAP income before tax provision
          $ 1,151     $ 4,665     $ 4,078  
Adjustments related to stock based compensation and other
            (2,920 )     (5,469 )     (3,617 )
 
                               
GAAP (loss) income before tax provision
          $ (1,769 )   $ (804 )   $ 461  
 
                               

4

RECONCILIATION OF NON-GAAP STATEMENTS OF OPERATIONS TO GAAP STATEMENTS OF OPERATIONS
(Unaudited, in thousands)

                                 
            Three Months Ended
            Apr. 5, 2009   Jan. 4, 2009   Apr. 6, 2008
Net income (loss):
                               
Non-GAAP net income
          $ 806     $ 3,266     $ 2,855  
Adjustments related to stock based compensation, deferred tax valuation allowances, other, and tax
            (3,762 )     (15,758 )     (2,679 )
 
                               
GAAP net income (loss)
          $ (2,956 )   $ (12,492 )   $ 176  
 
                               
Net income (loss) per share:
                               
Basic:
                               
Non-GAAP net income per share
          $ 0.03     $ 0.13     $ 0.11  
Adjustments related to stock based compensation, deferred tax valuation allowances, other and tax
            (0.14 )     (0.61 )     (0.10 )
 
                               
GAAP net income (loss) per share
          $ (0.11 )   $ (0.48 )   $ 0.01  
 
                               
Diluted:
                               
Non-GAAP net income per share
          $ 0.03     $ 0.13     $ 0.11  
Adjustments related to stock based compensation, deferred tax valuation allowances, other and tax
            (0.14 )     (0.61 )     (0.10 )
 
                               
GAAP net income (loss) per share
          $ (0.11 )   $ (0.48 )   $ 0.01  
 
                               

5

ACTEL CORPORATION

CONSOLIDATED BALANCE SHEETS
(In thousands)

                 
    Apr. 5, 2009   Jan. 4, 2009
ASSETS
  (Unaudited)   (Audited)
Current assets:
               
Cash and cash equivalents
  $ 46,036     $ 49,639  
Short-term investments
    85,072       89,111  
Accounts receivable, net
    21,765       11,596  
Inventories
    56,030       60,630  
Deferred income taxes
    11,313       11,313  
Prepaid expenses and other current assets
    7,876       6,888  
 
               
Total current assets
    228,092       229,177  
Long-term investments
    8,764       7,807  
Property and equipment, net
    33,588       34,747  
Goodwill and other intangible assets, net
    35,347       35,540  
Deferred income taxes
    13,834       13,968  
Other assets, net
    20,745       22,022  
 
               
 
  $ 340,370     $ 343,261  
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Current liabilities:
               
Accounts payable
  $ 10,516     $ 14,672  
Accrued compensation and employee benefits
    8,067       11,240  
Accrued licenses
    2,244       3,952  
Other accrued liabilities
    5,432       5,274  
Deferred income on shipments to distributors
    30,506       24,316  
 
               
Total current liabilities
    56,765       59,454  
Deferred compensation plan liability
    4,152       4,086  
Deferred rent liability
    1,447       1,449  
Accrued sabbatical compensation
    2,561       2,739  
Other long-term liabilities, net
    6,539       7,208  
 
               
Total liabilities
    71,464       74,936  
Shareholders’ equity
    268,906       268,325  
 
               
 
  $ 340,370     $ 343,261  
 
               

6


The following information was filed by Actel Corp on Tuesday, April 28, 2009 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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SEC Filing Tools
CIK: 907687
Form Type: 10-Q Quarterly Report
Accession Number: 0000950134-09-010800
Submitted to the SEC: Fri May 15 2009 1:06:27 PM EST
Accepted by the SEC: Fri May 15 2009
Period: Sunday, April 5, 2009
Industry: Semiconductors And Related Devices

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