Net revenue for the third quarter of 2006 was $5.7 million, compared to net revenue of $6.6 million for the second quarter of 2006 and net revenue of $3.7 million in the comparable third quarter of 2005. Gross margin for the third quarter of 2006 was $2.8 million, compared to $3.4 million for the second quarter of 2006 and $2.1 million for the comparable third quarter of 2005. The percentage gross margin was 50 percent for the third quarter of 2006 as compared to 51 percent for the second quarter of 2006 and 57 percent for the comparable third quarter of 2005.
The Company reported a net loss of ($0.7) million for the third quarter of 2006, or ($0.06) per share, compared to a net income of $0.4 million, or $0.03 per share, for the second quarter of 2006 and a net loss of ($1.8) million, or ($0.14) per share, for the comparable third quarter of 2005. The net loss in the third quarter of 2006 included $0.9 million in costs related to the proposed merger of Micro Linear with Sirenza Microdevices, Inc. and approximately $0.2 million of stock option expenses related to the adoption of SFAS 123R.
Net revenue for the nine months ended September 30, 2006 was $17.5 million, compared to $13.9 million for the first nine months of 2005. Gross margin for the first nine months of 2006 totaled $9.1 million compared to $7.9 million for the first nine months of 2005. The Company reported a net loss of $0.4 million, or ($0.03) per share, for the first nine months of 2006, compared to a net loss of $4.1 million, or ($0.33) per share, for the first nine months of 2005. Net loss for the first nine months of 2006 included $0.9 million in costs related to the proposed merger of Micro Linear with Sirenza Microdevices, Inc. and approximately $0.4 million of stock option expenses related to FAS 123R.
Cash, cash equivalents and short-term investments totaled $12.8 million at September 30, 2006, compared to $12.2 million at June 30, 2006 and $11.1 million as of December 31, 2005.
"During the third quarter, design activity by potential customers for the ML1905 continued, and we remain pleased with our progress to date," commented Tim Richardson, President and Chief Executive Officer of Micro Linear Corporation. "Although it is too early to determine the ML1905's contribution to revenue, we remain encouraged by the opportunities within the PHS market."
"More importantly, we are enthusiastic about the proposed merger with Sirenza Microdevices, as the combined company brings together a broad complementary product and market portfolio," Mr. Richardson continued. "In October, Institutional Shareholder Services and Glass Lewis both recommended voting FOR the proposed merger based on the terms of the transaction, noting the reasonable premium, as well as the rigorous sales process and unanimous support from each company's Board of Directors."
Mr. Richardson concluded, "We believe that the merger will result in a stronger, more competitive company that will be well positioned to build stockholder value and provide enhanced relationships with our customers and partners. Our special stockholders' meeting will be held on October 31, 2006. We encourage stockholders as of the record date, Monday, September 11, 2006, to vote FOR the merger."
Forward Looking Statements:
Except for the historical information contained herein, the statements in this press release, including, but not limited to statements. Additional risks are detailed in the Company's filings with the Securities and Exchange Commission, including the Company's Quarterly Report on Form 10-Q for the quarter ended July 2, 2006 and Annual Report on Form 10-K for the fiscal year ended January 1, 2006. Statements included in this release are based on information known to the Company as of the date of this release, and the Company assumes no obligation to update information contained in this release.
About Micro Linear:
Micro Linear Corporation is a fabless semiconductor company specializing in wireless integrated circuit solutions, which enable a variety of wireless products serving a global market. These transceivers can be used in many streaming wireless applications such as cordless phones, PHS handsets, wireless speakers and headphones, security cameras, game controllers, cordless headsets and other personal electronic appliances. Headquartered in San Jose, California, Micro Linear's products are available through its authorized representatives and distributors worldwide. For more information, please visit www.microlinear.com .
Additional Information and Where to Find It
This press release is not a proxy statement or a prospectus for the proposed transaction. Sirenza has filed a registration statement on Form S-4 (Registration No. 333-137086) in connection with Sirenza's proposed acquisition of Micro Linear, which includes Micro Linear's proxy statement and Sirenza's prospectus for the proposed transaction. Investors are urged to read the proxy statement/prospectus, which contains important information about the proposed transaction. The proxy statement/prospectus and other documents which are filed by Sirenza or Micro Linear with the Securities and Exchange Commission (SEC) are available free of charge at the SEC's website, www.sec.gov, or by directing a request when such a filing is made by Sirenza to Sirenza Microdevices, Inc., 303 S. Technology Court, Broomfield, CO 80021, Attention: Investor Relations or by directing a request when such a filing is made by Micro Linear to Micro Linear Corporation, 2050 Concourse Drive, San Jose, CA 95131, Attention: Investor Relations.
Micro Linear, its directors and certain of its executive officers, as well as Sirenza, its directors and certain of its executive officers, may be considered participants in the solicitation of proxies in connection with the proposed transaction. Information about the directors and executive officers of Micro Linear and their respective interests in the proposed transaction is set forth in the proxy statement/prospectus that Sirenza and Micro Linear have filed with the SEC in connection with the proposed transaction. Investors may obtain additional information regarding the interests of such participants by reading the proxy statement/prospectus.
MICRO LINEAR CORPORATION CONSOLIDATED BALANCE SHEETS UNAUDITED (IN THOUSANDS) SEPT 30 DEC 31 2006 2005 ASSETS CURRENT ASSETS CASH AND SHORT-TERM INVESTMENTS $12,790 $11,137 ACCOUNTS RECEIVABLE, NET 2,405 2,638 INVENTORIES 1,660 1,927 OTHER CURRENT ASSETS 315 297 TOTAL CURRENT ASSETS 17,170 15,999 PROPERTY & EQUIPMENT, NET 232 410 OTHER ASSETS 17 17 TOTAL ASSETS $17,419 $16,426 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES ACCOUNTS PAYABLE $2,925 $1,269 ACCRUED LIABILITIES 1,584 2,280 TOTAL CURRENT LIABILITIES 4,509 3,549 STOCKHOLDERS' EQUITY COMMON STOCK 16 16 ADDITIONAL PAID-IN CAPITAL 63,722 63,281 ACCUMULATED OTHER COMPREHENSIVE LOSS 2 (4) ACCUMULATED DEFICIT (30,597) (30,183) TREASURY STOCK (20,233) (20,233) TOTAL STOCKHOLDERS' EQUITY 12,910 12,877 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $17,419 $16,426 MICRO LINEAR CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED (IN THOUSANDS, EXCEPT PER SHARE DATA) THREE MONTHS ENDED NINE MONTHS ENDED Sept 30, Sept 30, Sept 30, Sept 30 2006 2005 2006 2005 NET REVENUE $5,660 $3,674 $17,538 $13,884 COST OF GOODS SOLD 2,847 1,589 8,435 5,962 GROSS MARGIN 2,813 2,085 9,103 7,922 OPERATING EXPENSES: RESEARCH AND DEVELOPMENT 1,342 2,350 4,474 7,013 SELLING, GENERAL AND 1,522 1,606 4,593 5,325 ADMINISTRATIVE MERGER COSTS 907 -- 907 -- TOTAL OPERATING 3,771 3,956 9,974 12,338 EXPENSES LOSS FROM OPERATIONS (958) (871) (1,871) (4,416) INTEREST AND OTHER INCOME 149 111 405 307 INTEREST AND OTHER EXPENSE (1) (4) (4) (10) LOSS BEFORE INCOME TAXES (810) (1,764) (470) (4,119) (PROVISION FOR) BENEFIT FROM 62 (8) 56 (15) INCOME TAXES NET LOSS (748) (1,772) (414) (4,134) LOSS PER SHARE: BASIC $(0.06) $(0.14) $(0.03) $(0.33) DILUTED $(0.06) $(0.14) $(0.03) $(0.33) WEIGHTED AVERAGE SHARES: BASIC 12,996 12,906 12,992 12,652 DILUTED 12,996 12,906 12,992 12,652
Web site: http://www.microlinear.com//