Pericom Semiconductor Reports Fiscal Second Quarter 2015 Financial Results

MILPITAS, CA -- (Marketwired) -- Jan 26, 2015 --


SECOND QUARTER HIGHLIGHTS

  • Revenues increased 3.8% year-over-year to $33.3 million
  • Achieved 44.6% gross margin (46.2% non-GAAP), a year-over-year increase of 650 bps
  • Operating margin was 8.3% (13.5% non-GAAP) as compared with -0.6% in the same quarter last year
  • Net income was $0.16 per diluted share as compared with $0.05 in Q2 last year
  • Non-GAAP net income was $0.22 per diluted share as compared with $0.08 in Q2 last year
  • Initiated quarterly dividend of $0.06 per common share

Pericom Semiconductor Corporation (NASDAQ: PSEM), a worldwide supplier of high performance connectivity and timing solutions, today announced results for its fiscal 2015 second quarter ended December 27, 2014.

Net revenues for the second quarter were $33.3 million, flat compared to the first quarter of fiscal 2015 and up 3.8% from the $32.0 million reported in the comparable period last year. Revenue increased year-over-year primarily as a result of strength in the PC/notebook, server and embedded end-markets.

GAAP gross margin was 44.6% in the second quarter, a 230 basis point increase from 42.3% last quarter and a 650 basis point increase from 38.1% for the comparable period last year.

GAAP net income for the second quarter was $3.7 million, or $0.16 per diluted share, compared with net income of $2.5 million, or $0.11 per diluted share in the first quarter, and net income of $1.2 million, or $0.05 per diluted share, in the comparable period last year. The current quarter benefited from pretax foreign exchange gains of approximately $1.2 million.

To facilitate the complete understanding of comparable financial performance between periods, Pericom also presents performance results net of certain non-cash and one-time items as non-GAAP measures.

On a non-GAAP basis, gross margin was 46.2% in the second quarter, an increase from 44.2% last quarter and 39.8% in the comparable period last year.

On a non-GAAP basis, net income for the second quarter was $5.0 million, or $0.22 per diluted share, compared with non-GAAP net income of $3.7 million, or $0.16 per diluted share, in the first quarter, and non-GAAP net income of $1.9 million, or $0.08 per diluted share, in the comparable period last year.

"Our fiscal second quarter results reflect another quarter of strong earnings growth. Given the increase in shareholder value resulting from the Company's financial performance over the last year, I am pleased to announce the initiation of a quarterly cash dividend of $0.06 cents per share," said Alex Hui, President and CEO of Pericom. "Execution on our strategic initiatives has enabled us to deliver consistent improvement in gross and operating margins resulting in higher profitability. Looking forward, we remain focused on targeting a richer product mix across our serial connectivity and timing solutions, while expanding our customer base and content in high growth applications such as networking, cloud computing and embedded."

New Products

In the second quarter of fiscal 2015, Pericom introduced a total of 24 new products in our Signal Integrity, Connectivity, Switching and Timing product areas. All of these products are targeted to our focus market segments, and were sampled to key customers during the quarter.

For Signal Integrity, we introduced 4 new products, including an addition to the low voltage USB3 5Gb redriver for mobile platforms, and HDMI and Display Port (DP) redrivers for video and graphics platforms.

We introduced 4 new products across our Connectivity product families which included new additions to the 'Mezzo' family of medium size port/lane count PCIe GEN2 packet switches aimed at enterprise, cloud computing, and embedded applications, and UART bridges aimed at embedded applications.

We introduced 8 new products across our Switching product families, including 12Gb high performance USB charging, wide voltage range and audio switches targeting server, storage, networking, embedded, and mobile platform applications.

We expanded our Timing solutions for next generation enterprise and cloud computing platforms with 8 new products, including high performance clock buffers, generators, and crystal oscillators (XO) aimed at enterprise and networking, and Real Time Clocks (RTC) for mobile applications.

Dividend

The Company announced today that Pericom's Board of Directors has approved the initiation of quarterly cash dividends, commencing with a dividend of $0.06 per share of common stock for the quarter ended December 27, 2014. The payment of this dividend will be made on February 24, 2015 to shareholders of record on February 10, 2015.

Share Repurchase Update

On April 26, 2012, the Board authorized a repurchase program for up to $25 million of shares of our common stock, and on April 24, 2014, the Board authorized an additional $20 million of share repurchases. Pursuant to these authorizations, the Company repurchased 172,388 shares in the three months ended December 27, 2014 for an aggregate cost of $1.7 million at an average per share purchase price of $9.90. The remaining balance of potential share repurchases under the authorization is approximately $22.6 million. Shares may be repurchased from time to time in the open market or through private transactions, at the discretion of Pericom management. As of January 22, 2015, Pericom had approximately 22.4 million shares of common stock outstanding.

Fiscal Q3 2015 Outlook

The following statements are based on current expectations. These statements are forward looking, and actual results may differ materially. Pericom's revenue guidance for the third fiscal quarter reflects typical seasonality related to the Chinese New Year Holiday, and the Company expects a return to growth in the fourth fiscal quarter. For the fiscal quarter ended March 28, 2015 guidance is as follows:

  • Revenues are expected to be in the range of $31.5 million to $33.5 million.

  • GAAP gross margins are expected to be approximately 43.5%, and adjusting for share-based compensation, amortization of intangibles and fair value adjustments that are expected to total approximately 1.5%, non-GAAP gross margins are expected to be approximately 45.0%.

  • GAAP operating expenses are expected to be approximately $12.4 million, and adjusting for share-based compensation, amortization of intangibles and fair value adjustments that are expected to total approximately $1.2 million, non-GAAP operating expenses are expected to be approximately $11.2 million.

  • Other income is expected to be approximately $1.0 million on both a GAAP and non-GAAP basis.

  • The effective tax rate is expected to be 26% to 28% on a GAAP basis and 22% to 24% on a non-GAAP basis.

Conference Call

The press release will be followed by a conference call beginning at 1:30 p.m. Pacific time on January 26, 2015. To listen to the call, dial (877) 377-7103 and provide the operator with conference ID 66516141. A slide presentation will accompany the conference call. To view the slides, please visit the investor relations section of www.pericom.com.

The Pericom financial results conference call will also be available via a live webcast on the investor relations section of the website at http://www.pericom.com. Access the website 15 minutes prior to the start of the call to download and install any necessary audio software. An archived webcast replay will be available on the website for approximately 90 days.

About Pericom

Pericom Semiconductor Corporation (NASDAQ: PSEM) enables serial connectivity with the industry's most complete solutions for the computing, communications, consumer and embedded market segments. Pericom's analog, digital and mixed-signal integrated circuits, along with its frequency control products are essential in the timing, switching, bridging and conditioning of high-speed signals required by today's ever-increasing speed and bandwidth demanding applications. Company headquarters is in Milpitas, California, with design centers and technical sales and support offices globally. Pericom and the Pericom logo are trademarks or registered trademarks of Pericom Semiconductor Corp in the U.S. and/or other countries. Our website is http://www.pericom.com.

Non-GAAP Financial Information

In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles (GAAP), this announcement of operating results contains non-GAAP financial measures that exclude the income statement effects of share-based compensation, amortization of intangible assets, fair value adjustments on acquired fixed assets, restructuring charges, lease restructuring and moving costs, asset write-offs, tax provision on intercompany transactions, the corresponding tax effects and the effects of excluding share-based compensation upon the number of diluted shares used in calculating non-GAAP earnings per share.

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