- Gross margin percentage of 58.3%, up from 57.5% in Q3 and down from 65.9% in last year's Q4
- Bookings were up 30% sequentially over Q3
- Q4 net loss of $64 million includes pre-tax restructuring charge of $116 million
- Sales outlook for Q1 of fiscal 2010 expected to range from $285 million to $305 million, or an increase of 2 to 9 percent sequentially
SANTA CLARA, Calif., June 11 /PRNewswire-FirstCall/ --National Semiconductor Corp. (NYSE: NSM) today reported sales of $281 million and a net loss of $64 million, or a loss of 28 cents per share, for the fourth quarter of fiscal 2009 which ended May 31, 2009. National's fourth quarter of fiscal 2009 results included $116 million of pre-tax charges primarily for severance and asset impairments related to an action announced on March 11, 2009.
National's fourth quarter fiscal 2009 sales of $281 million were 4 percent lower than the third quarter of fiscal 2009, when the company reported $292 million in sales and earnings of 9 cents per share. National's third quarter of fiscal 2009 had 14 weeks, and National's fourth quarter of fiscal 2009 had 13 weeks. Gross margin of 58.3 percent in National's fourth quarter of fiscal 2009 was up from the 57.5 percent gross margin achieved in the third quarter of fiscal 2009.
Compared to last year, fourth quarter fiscal 2009 sales were down 39 percent from the $462 million reported in the fourth quarter of fiscal 2008. Fourth quarter loss per share of 28 cents was below the 34 cents of positive earnings per share recorded in the fourth quarter a year ago. Gross margin in the fourth quarter of fiscal 2009 was also lower than the 65.9 percent reported in the fourth quarter of fiscal 2008.
Bookings for Q4, Fiscal 2009
National's total company bookings in the fourth quarter of fiscal 2009 increased by approximately 30 percent sequentially over the third quarter. This increase was attributable to increased orders from manufacturers of wireless handsets and other personal mobile devices as well as increased bookings from distributors who serve the broader electronics market. Bookings were up sequentially in all regions except Japan, with the highest percentage increase occurring in the Asia Pacific region. Total company bookings exceeded billings in the fourth quarter.
Summary of Fiscal 2009
Annual sales in fiscal 2009 were $1.46 billion compared to $1.89 billion in fiscal 2008. For fiscal 2009, National reported net income of $73 million, compared to net income of $332 million in fiscal 2008. Earnings per share for the year were 31 cents compared to $1.26 in fiscal 2008. National's gross margin in fiscal 2009 was 62.7 percent compared to 64.4 percent in fiscal 2008. The company's effective tax rate was 35.5 percent for fiscal 2009 compared to 26.4 percent for fiscal 2008. Return on invested capital for fiscal 2009 was approximately 15 percent compared to approximately 23 percent for fiscal 2008.
Notable Items in Q4, Fiscal 2009 Results
In the fourth quarter of fiscal 2009, National implemented restructuring actions designed to lower costs including the elimination of 850 positions worldwide and the planned closing of two manufacturing facilities. Fourth quarter fiscal 2009 net results included approximately $116 million in expenses primarily related to severance and asset impairments for the actions noted above, as well as $2.9 million of in-process research and development expense associated with the previously announced acquisition of ActSolar, Inc.
Outlook for Q1, Fiscal 2010
National anticipates that sales in the first quarter of fiscal 2010 will range from $285 million to $305 million, or an increase of approximately 2 percent to 9 percent sequentially.
"Business conditions improved through the quarter. We saw increasing orders from our wireless handset customers as they began ramping production of new smartphone models," said Brian L. Halla, National's chairman and CEO. "We are well positioned to enable greater energy efficiency in a wide range of products with our analog and power management circuits."
Company Declares Dividend
The company announced today that the Board of Directors has declared a cash dividend of $0.08 per outstanding share of common stock. This dividend will be paid on July 13, 2009 to shareholders of record at the close of business on June 22, 2009.
Special Note
This release contains forward-looking statements dependent on a number of risks and uncertainties pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Except for historical information contained herein, the matters set forth in this press release, including management's expectations regarding future performance, are forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ materially from those forward-looking statements. Potential risks and uncertainties include, but are not restricted to, such factors as new orders received and shipped during the quarter, the degree of factory utilization, the sale of inventories at existing prices, and the ramp up and sale of new analog products. Other risk factors are included in the company's Annual Report on Form 10-K for the fiscal year ended May 25, 2008 under the captions "Outlook," "Risk Factors" and "Management's Discussion and Analysis of Financial Conditions and Results of Operations" contained therein and the Quarterly Report on Form 10-Q for the quarter ended March 1, 2009.
About National Semiconductor
National Semiconductor is a leader in analog power management technology. Its products include easy-to-use integrated circuits, PowerWise products that enable more energy-efficient systems, and SolarMagic products which improve the energy output of solar arrays. The company celebrates its 50th anniversary this year. Headquartered in Santa Clara, Calif., National reported sales of $1.46 billion for fiscal 2009. Additional information is available at www.national.com.
NATIONAL SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In millions, except per share amounts)
Three Months Ended Twelve Months Ended
------------------ -------------------
May 31, May 25, May 31, May 25,
2009 2008 2009 2008
---- ---- ---- ----
Net sales $280.8 $462.0 $1,460.4 $1,885.9
Cost of sales 117.2 157.4 544.1 671.5
----- ----- ----- -----
Gross margin 163.6 304.6 916.3 1,214.4
Research and development 51.9 90.2 306.0 363.0
Selling, general and
administrative 65.2 79.8 283.0 315.5
Severance and restructuring
expenses 116.1 9.1 143.9 27.2
In-process research and
development charge 2.9 - 2.9 -
Other operating income, net (2.3) (0.4) (2.7) (0.4)
---- ---- ---- ----
Operating expenses, net 233.8 178.7 733.1 705.3
----- ----- ----- -----
Operating (loss) income (70.2) 125.9 183.2 509.1
Interest income 0.8 4.8 10.4 33.8
Interest expense (17.0) (19.6) (72.7) (85.5)
Other non-operating income
(expense), net 6.8 1.1 (7.3) (6.2)
--- --- ---- ----
(Loss) income before taxes (79.6) 112.2 113.6 451.2
Income tax (benefit) expense (15.9) 29.0 40.3 118.9
----- ---- ---- -----
Net (loss) income $(63.7) $83.2 $73.3 $332.3
====== ===== ===== ======
(Loss) earnings per share:
Basic $(0.28) $0.35 $0.32 $1.31
Diluted $(0.28) $0.34 $0.31 $1.26
Selected income statement
ratios as a percentage of
sales:
Gross margin 58.3% 65.9% 62.7% 64.4%
Research and development 18.5% 19.5% 21.0% 19.2%
Selling, general and
administrative 23.2% 17.3% 19.4% 16.7%
Net (loss) income (22.7%) 18.0% 5.0% 17.6%
Effective tax rate 20.0% 25.8% 35.5% 26.4%
NATIONAL SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(In millions)
May 31, May 25,
2009 2008
---- ----
ASSETS
Current assets:
Cash and cash equivalents $700.3 $736.8
Receivables, net 71.7 137.3
Inventories 134.6 148.6
Deferred tax assets 82.2 82.9
Other current assets 108.0 66.0
----- ----
Total current assets 1,096.8 1,171.6
Net property, plant and equipment 461.8 557.3
Goodwill 61.5 60.5
Deferred tax assets 241.9 247.5
Other assets 101.3 112.2
----- -----
Total assets $1,963.3 $2,149.1
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $62.5 $62.5
Accounts payable 40.3 53.5
Accrued expenses 144.6 180.3
Income taxes payable 28.2 12.3
---- ----
Total current liabilities 275.6 308.6
Long-term debt 1,227.4 1,414.8
Long-term income taxes payable 162.6 143.4
Other non-current liabilities 120.7 85.4
----- ----
Total liabilities 1,786.3 1,952.2
------- -------
Commitments and contingencies
Shareholders' equity:
Common stock of $0.50 par value 116.3 116.3
Additional paid-in-capital 67.6 -
Retained earnings 116.8 167.4
Accumulated other comprehensive loss (123.7) (86.8)
------ -----
Total shareholders' equity 177.0 196.9
----- -----
Total liabilities and shareholders'
equity $1,963.3 $2,149.1
======== ========
NATIONAL SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In millions)
Twelve Months Ended
-------------------
May 31, May 25,
2009 2008
---- ----
Cash flows from operating activities:
Net income $73.3 $332.3
Adjustments to reconcile net income with
net cash provided by operating activities:
Depreciation and amortization 119.8 132.7
Share-based compensation 70.9 89.7
Excess tax benefit from share-based
payment arrangements (5.0) (17.0)
Tax benefit associated with stock options 8.1 27.6
Loss on investments 7.3 6.0
Loss on disposal of equipment 0.4 3.3
Impairment of equipment and other assets 52.7 -
Non-cash restructuring (recovery) expense (2.0) 3.0
Gain on sale of manufacturing plant
assets - (3.1)
In-process research and development
charge 2.9 -
Other, net 0.7 4.0
Changes in certain assets and liabilities, net:
Receivables 65.2 13.3
Inventories 13.5 27.1
Other current assets 2.9 23.3
Accounts payable and accrued expenses (36.5) 46.0
Current and deferred income taxes 12.7 (13.3)
Other non-current liabilities (26.1) (30.6)
----- -----
Net cash provided by operating activities 360.8 644.3
----- -----
Cash flows from investing activities:
Purchase of property, plant and
equipment (83.7) (111.3)
Business acquisition, net of cash
acquired (4.5) -
Proceeds from sale of property, plant,
and equipment 1.1 16.6
Proceeds from sale of investments 0.4 0.2
Funding of benefit plan (6.4) (5.4)
Redemption and net realized losses
(gains) of benefit plan 11.6 (0.2)
Other, net (0.2) (1.9)
---- ----
Net cash used in investing activities (81.7) (102.0)
----- ------
Cash flows from financing activities:
Proceeds from unsecured senior notes,
net of issuance costs - 992.9
Proceeds from bank borrowings, net of
issuance costs - 1,996.5
Repayment of bank borrowing (187.6) (1,546.8)
Payment on software license obligations - (8.7)
Excess tax benefit from share-based
payment arrangements 5.0 17.0
Minimum tax withholding paid on behalf
of employees for net share settlements (0.4) (14.6)
Issuance of common stock 60.2 103.7
Purchase and retirement of treasury
stock (128.4) (2,123.5)
Cash dividends declared and paid (64.4) (50.6)
----- -----
Net cash used in financing activities (315.6) (634.1)
------ ------
Net change in cash and cash equivalents (36.5) (91.8)
Cash and cash equivalents at beginning
of the year 736.8 828.6
----- -----
Cash and cash equivalents at end of the year $700.3 $736.8
====== ======
PART I. FINANCIAL INFORMATION
EARNINGS PER SHARE (Unaudited)
(In millions, except per share amounts)
Three Months Ended Twelve Months Ended
------------------ -------------------
May 31, May 25, May 31, May 25,
2009 2008 2009 2008
---- ---- ---- ----
(Loss) earnings per share:
Basic $(0.28) $0.35 $0.32 $1.31
Diluted $(0.28) $0.34 $0.31 $1.26
Net (loss) income used in
basic and diluted (loss)
earnings per share
calculation $(63.7) $83.2 $73.3 $332.3
Weighted-average shares
outstanding:
Basic 230.1 236.8 229.1 252.8
Diluted 230.1 246.3 235.1 264.3
OTHER FINANCIAL STATEMENT DETAIL
(In millions)
Three Months Ended Twelve Months Ended
------------------ -------------------
May 31, May 25, May 31, May 25,
2009 2008 2009 2008
---- ---- ---- ----
Other operating income, net
---------------------------
Net intellectual property
income $(2.3) $(0.4) $(2.7) $(0.6)
Gain on sale of
manufacturing plant assets - - - (3.1)
Litigation settlement - - - 3.3
--- --- --- ---
Total other operating
income, net $(2.3) $(0.4) $(2.7) $(0.4)
===== ===== ===== =====
Other non-operating income
(expense), net
--------------------------
Gain (loss) on investments $6.8 $1.1 $(7.3) $(6.0)
Charitable contribution - - - (0.2)
--- --- --- ----
Total other non-operating
income (expense), net $6.8 $1.1 $(7.3) $(6.2)
==== ==== ===== =====
Share-based compensation
expense $16.9 $19.7 $70.7 $89.7
------------------------ ===== ===== ===== =====
Media Contact: Financial:
LuAnn Jenkins Mark Veeh
National Semiconductor National Semiconductor
(408) 721-2440 (408) 721-5007
luann.jenkins@nsc.com invest.group@nsc.com
Web site: http://www.national.com/