Actel Announces Second Quarter 2010 Financial Results and Appoints Chairman
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Actel Announces Second Quarter 2010 Financial Results and Appoints Chairman

MOUNTAIN VIEW, CA -- (MARKET WIRE) -- Jul 29, 2010 -- Actel Corporation (NASDAQ: ACTL) today announced net revenues of $57.8 million for the second quarter of 2010, up 27.7 percent from the second quarter of 2009 and up 10.5 percent from the first quarter of 2010.

Actel reported net income in accordance with U.S. generally accepted accounting principles (GAAP) of $4.8 million, or $0.18 per diluted share, for the second quarter of 2010 compared with a net loss of $(45.1) million, or $(1.73) per basic and diluted share, for the second quarter of 2009 and a net income of $2.9 million, or $0.11 per diluted share, for the first quarter of 2010.

Non-GAAP net income, which excludes stock-based compensation, expenses associated with restructuring activities, and other non-recurring adjustments, was $6.6 million, or $0.25 per diluted share, for the second quarter of 2010 compared with $14 thousand, or $0.00 per diluted share, for the second quarter of 2009 and $3.8 million, or $0.14 per diluted share, for the first quarter of 2010.

Significant Developments

During the second quarter:

--  Actel announced a comprehensive motor control solution for its
    SmartFusion family of devices. The combination of an embedded ARM
    Cortex-M3, FPGA fabric, and programmable analog make SmartFusion
    very well suited for complex, single chip motor control applications.
    As part of the motor control offering, Actel announced a partnership
    with Trinamic, the industry leader in embedded motion control systems.

--  Actel continues to grow the SmartFusion ecosystem with support from
    Keil, Synopsys and Aplix. The latest release of the Keil MDK-ARM 
    Microcontroller Development Kit supports SmartFusion devices and
    includes set-up files, device-specific views and example projects.
    Synopsys' Synplify Pro® FPGA synthesis tools have been enhanced to
    offer advanced support and timing optimization. With Aplix
    Corporation's picoJBlend™ platform, Actel and its customers are
    now able to quickly develop and bring to market intelligent smart
    grid power management solutions.

--  Continuing its commitment to the avionics industry, Actel
    introduced a new ARINC 429 development kit, leveraging the proven
    aviation flight heritage of the Core429 IP Core from Actel. The
    Core429 Development Kit is a hardware development platform designed
    to simplify the design and debug of a customer's system
    incorporating the Core429 IP Core.

Appointment of Chairman

Actel also today announced that J. Daniel McCranie was appointed to serve as Chairman of the Board. Mr. McCranie is an "independent director" as defined in Rule 5605(a)(2) of The Nasdaq Global Market. The Company's Board of Directors previously did not have a Chairman.

Of the nine publicly-traded companies for which Mr. McCranie has served on the Board of Directors, Actel will be the fourth for which he has served as Chairman. He has also served as the Chairman of Audit, Compensation, Executive, and Nominating and Corporate Governance Committees, been the Chief Executive Officer of two publicly-traded companies and the Executive Vice President of a third publicly-traded company, and managed sales, marketing, mergers and acquisitions, investor relations, and operations. Mr. McCranie's experience as a member of the Company's Board of Directors since 2004, in combination with his extensive executive and managerial experience in the semiconductor industry, gives him a deep understanding of the Company and its business and makes him extraordinarily well qualified to serve as Chairman of the Company's Board of Directors.

"In accordance with good corporate governance practices, the Board decided some time ago to appoint an independent Chairman," said Robert G. Spencer, Chairman of the Board's Nominating and Corporate Governance Committee, "and Dan is a great choice. We are pleased that Dan has agreed to lead the Board." Mr. Spencer served as Lead Independent Director from July 2007 until Mr. McCranie was appointed Chairman on July 27, 2010.

"I've known Dan for 30 years," said John C. East, President and Chief Executive Officer. "I know him to be a guy with extraordinary capabilities. His experience and track record of success speak for themselves. We're lucky to have him!" Mr. East announced in February 2010 that he will retire as President and Chief Executive Officer of the Company and as a member of the Board of Directors. He will remain in his current roles until a new Chief Executive Officer is in place, and will then serve as a consultant until August 2, 2011. Mr. East is participating in the ongoing search for his successor.

Business Outlook -- Third Quarter 2010

The Company believes that revenues in third quarter of 2010 will be up 3 percent to 7 percent sequentially. Gross margin is expected to be about 65 percent. Operating expenses are anticipated to come in at approximately $25.5 million, which excludes an estimated $2.3 million of stock-based compensation expense, $0.2 million associated with the acquisition of Pigeon Point Systems and restructuring charges of $1.7 million. Other income is expected to be about $0.5 million. The non-GAAP 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 second quarter results will be held Thursday, July 29, 2010, at 2:00 p.m. PDT. A live webcast and replay of the call will be available. Webcast and replay access information as well as financial and other statistical information can be found on Actel's website, www.actel.com.

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, particularly 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 paragraph under the heading "Business Outlook -- Third Quarter 2010" 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 website, www.actel.com. Actel's projected revenues and operating results for the third quarter of 2010 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 financial 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.

Actel, Actel Fusion, IGLOO, Libero, Pigeon Point, ProASIC, SmartFusion and the associated logos are trademarks or registered trademarks of Actel Corporation. All other trademarks and service marks are the property of their respective owners.

                            ACTEL CORPORATION

              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
            (Unaudited, in thousands except per share amounts)


                           Three Months Ended           Six Months Ended
                     -------------------------------  --------------------
                      July 4,    Apr. 4,    July 5,    July 4,    July 5,
                       2010       2010       2009       2010       2009
                     ---------- ---------- ---------  ---------- ---------

Net revenues         $   57,776 $   52,263 $  45,227  $  110,039 $  93,686
Costs and expenses:
  Cost of revenues       21,515     19,741    32,595      41,256    53,380
  Research and
   development           15,244     14,727    15,326      29,971    31,719
  Selling, general,
   and administrative    15,041     15,013    13,659      30,054    27,149
  Restructuring and
   asset impairment
   charges                1,314         14     5,594       1,328     6,713
  Amortization of
   acquisition-related
   intangibles              193        193       192         386       385
                     ---------- ---------- ---------  ---------- ---------
    Total costs and
     expenses            53,307     49,688    67,366     102,995   119,346
                     ---------- ---------- ---------  ---------- ---------
Income (loss) from
 operations               4,469      2,575   (22,139)      7,044   (25,660)
Interest income and
 other, net                 432        597       776       1,029     2,528
                     ---------- ---------- ---------  ---------- ---------
Income (loss) before
 tax provision            4,901      3,172   (21,363)      8,073   (23,132)
Tax provision                95        234    23,778         329    24,965
                     ---------- ---------- ---------  ---------- ---------
Net income (loss)    $    4,806 $    2,938 $ (45,141) $    7,744 $ (48,097)
                     ========== ========== =========  ========== =========

Net income (loss)
 per share:
  Basic              $     0.18 $     0.11 $   (1.73) $     0.29 $   (1.84)
                     ========== ========== =========  ========== =========
  Diluted            $     0.18 $     0.11 $   (1.73) $     0.29 $   (1.84)
                     ========== ========== =========  ========== =========
Shares used in
 computing net
 income (loss) per
 share:
  Basic                  26,218     26,313    26,146      26,265    26,087
                     ========== ========== =========  ========== =========
  Diluted                26,528     26,527    26,146      26,528    26,087
                     ========== ========== =========  ========== =========





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



                                   Three Months Ended     Six Months Ended
                               -------------------------- -----------------
                                July 4,  Apr. 4,  July 5,  July 4,  July 5,
                                 2010     2010     2009     2010     2009
                               -------- -------- -------- -------- --------
Cost and expenses:
  Non-GAAP cost of revenues    $ 21,515 $ 19,741 $ 19,339 $ 41,256 $ 40,124
  Adjustments related to
   excess inventory                   -        -   13,256        -   13,256
                               -------- -------- -------- -------- --------
  GAAP cost of revenues        $ 21,515 $ 19,741 $ 32,595 $ 41,256 $ 53,380
                               ======== ======== ======== ======== ========

  Non-GAAP research and
   development                 $ 13,633 $ 13,590 $ 14,056 $ 27,223 $ 29,161
  Adjustments related to stock
   based compensation and
   other                          1,611    1,137    1,270    2,748    2,558
                               -------- -------- -------- -------- --------
  GAAP research and
   development                 $ 15,244 $ 14,727 $ 15,326 $ 29,971 $ 31,719
                               ======== ======== ======== ======== ========

  Non-GAAP restructuring and
   asset impairment charges    $      - $      - $      - $      - $      -
  Adjustments related to
   restructuring and asset
   impairments                    1,314       14    5,594    1,328    6,713
                               -------- -------- -------- -------- --------
  GAAP restructuring and asset
   impairment charges          $  1,314 $     14 $  5,594 $  1,328 $  6,713
                               ======== ======== ======== ======== ========

  Non-GAAP amortization of
   acquisition-related
   intangibles                 $      - $      - $      - $      - $      -
  Adjustments related
   amortization of
   acquisition-related
   intangibles                      193      193      192      386      385
                               -------- -------- -------- -------- --------
  GAAP amortization of
   acquisition-related
   intangibles                 $    193 $    193 $    192 $    386 $    385
                               ======== ======== ======== ======== ========

  Non-GAAP selling, general
   and administrative          $ 13,666 $ 14,158 $ 12,588 $ 27,824 $ 25,042
  Adjustments related stock
   based compensation, and
   other                          1,375      855    1,071    2,230    2,107
                               -------- -------- -------- -------- --------
  GAAP selling, general and
   administrative              $ 15,041 $ 15,013 $ 13,659 $ 30,054 $ 27,149
                               ======== ======== ======== ======== ========





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


                            Three Months Ended          Six Months Ended
                      ------------------------------- --------------------
                       July 4,   Apr. 4,    July 5,    July 4,    July 5,
                        2010      2010       2009       2010       2009
                      --------- ---------  ---------  ---------  ---------

Income (loss) from
 operations:
  Non-GAAP income
   from operations    $   8,962 $   4,774  $    (756) $  13,736  $    (641)
  Adjustments related
   to excess
   inventory,
   restructuring,
   stock based
   compensation, and
   other                 (4,493)   (2,199)   (21,383)    (6,692)   (25,019)
                      --------- ---------  ---------  ---------  ---------
  GAAP income (loss)
   income from
   operations         $   4,469 $   2,575  $ (22,139) $   7,044  $ (25,660)
                      ========= =========  =========  =========  =========

Interest income and
 other, net:
  Non-GAAP interest
   income and other,
   net                $     432 $     597  $     776  $   1,029  $   1,812
  Adjustments related
   to insurance
   reimbursement              -         -          -          -        716
                      --------- ---------  ---------  ---------  ---------
  GAAP interest
   income and other,
   net                $     432 $     597  $     776  $   1,029  $   2,528
                      ========= =========  =========  =========  =========

Income (loss) before
 tax provision:
  Non-GAAP income
   before tax
   provision          $   9,394 $   5,371  $      20  $  14,765  $   1,171
  Adjustments related
   to excess
   inventory,
   restructuring,
   stock based
   compensation, and
   other                 (4,493)   (2,199)   (21,383)    (6,692)   (24,303)
                      --------- ---------  ---------  ---------  ---------
  GAAP income (loss)
   income before tax
   provision          $   4,901 $   3,172  $ (21,363) $   8,073  $ (23,132)
                      =========  =========  ========= =========  =========






RECONCILIATION OF NON-GAAP STATEMENTS OF OPERATIONS TO GAAP STATEMENTS OF
                                OPERATIONS
            (Unaudited, in thousands except per share amounts)



                            Three Months Ended          Six Months Ended
                      ------------------------------- --------------------
                       July 4,  Apr. 4,    July 5,    July 4,    July 5,
                        2010      2010       2009       2010       2009
                      --------- ---------  ---------  ---------  ---------
Net income (loss):
  Non-GAAP net income $   6,576 $   3,760  $      14  $  10,336  $     820
  Adjustments related
   to excess
   inventory,
   restructuring,
   stock based
   compensation,
   other and tax         (1,770)     (822)   (45,155)    (2,592)   (48,917)
                      --------- ---------  ---------  ---------  ---------
  GAAP net income
   (loss)             $   4,806 $   2,938  $ (45,141) $   7,744  $ (48,097)
                      ========= =========  =========  =========  =========

Net income (loss) per
 share:
  Basic:
  Non-GAAP net income
   per share          $    0.25 $    0.14  $       -  $    0.39  $    0.03
  Adjustments related
   to excess
   inventory,
   restructuring,
   stock based
   compensation,
   other and tax          (0.07)    (0.03)     (1.73)     (0.10)     (1.87)
                      --------- ---------  ---------  ---------  ---------
  GAAP net income
   (loss) per share   $    0.18 $    0.11  $   (1.73) $    0.29  $   (1.84)
                      ========= =========  =========  =========  =========

  Diluted:
  Non-GAAP net income
   per share          $    0.25 $    0.14  $       -  $    0.39  $    0.03
  Adjustments related
   to excess
   inventory,
   restructuring,
   stock based
   compensation,
   other and tax          (0.07)    (0.03)     (1.73)     (0.10)     (1.87)
                      --------- ---------  ---------  ---------  ---------
  GAAP net income
   (loss) per share   $    0.18 $    0.11  $   (1.73) $    0.29  $   (1.84)
                      ========= =========  =========  =========  =========






                            ACTEL CORPORATION

                  CONDENSED CONSOLIDATED BALANCE SHEETS
                              (In thousands)


                                                  July 4, 2010 Jan. 3, 2010
                                                  ------------ ------------
                      ASSETS                       (Unaudited)   (Audited)
Current assets:
  Cash and cash equivalents                       $     35,558 $     45,994
  Short-term investments                               124,454      106,007
  Accounts receivable, net                              44,121       19,112
  Inventories, net                                      36,417       37,324
  Deferred income taxes                                  1,729        1,729
  Prepaid expenses and other current assets              6,237        8,166
                                                  ------------ ------------
    Total current assets                               248,516      218,332
Long-term investments                                    2,812          663
Property and equipment, net                             20,651       22,969
Goodwill and other intangible assets, net               34,553       34,939
Deferred income taxes                                        -            -
Other assets, net                                       28,960       30,099
                                                  ------------ ------------
                                                  $    335,492 $    307,002
                                                  ============ ============
       LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                $     16,334 $     10,262
  Accrued compensation and employee benefits             8,826        8,206
  Accrued licenses                                       4,298        4,996
  Other accrued liabilities                              4,859        5,422
  Deferred income on shipments to distributors          39,917       22,867
                                                  ------------ ------------
    Total current liabilities                           74,234       51,753
  Deferred compensation plan liability                   5,428        5,470
  Deferred rent liability                                1,274        1,590
  Accrued sabbatical compensation                        2,844        2,805
  Other long-term liabilities, net                      10,897       11,921
                                                  ------------ ------------
    Total liabilities                                   94,677       73,539
  Shareholders' equity                                 240,815      233,463
                                                  ------------ ------------
                                                  $    335,492 $    307,002
                                                  ============ ============







                            ACTEL CORPORATION

              SUPPLEMENTAL HISTORICAL FINANCIAL INFORMATION
                                (Unaudited)


                                   Three Months Ended     Six Months Ended
                               -------------------------  ----------------
                               July 4,  Apr. 4,  July 5,  July 4,  July 5,
                                 2010     2010     2009     2010     2009
                               -------  -------  -------  -------  -------
Non-GAAP Operations
 Information
Percent of Revenue
Gross Margin                      62.8%    62.2%    57.2%    62.5%    57.2%
R&D Expense                       23.6%    26.0%    31.1%    24.7%    31.1%
SG&A Expense                      23.7%    27.1%    27.8%    25.3%    26.7%

Depreciation and Amortization
Expense (000's)                  2,902    2,995    3,257    5,897    6,754
Capital Expenditures (000's)     1,954    1,817    1,382    3,770    3,527

Revenue by Technology
   Flash                            29%      24%      29%      27%      26%
   Other                            71%      76%      71%      73%      74%

Revenue by Geographic Region
   North America                    46%      54%      52%      50%      52%
   Europe                           33%      20%      25%      27%      26%
   Asia Pacific/Rest of World       21%      26%      23%      23%      22%

Revenue by Channel
   OEM                              25%      37%      29%      31%      31%
   Distribution                     75%      63%      71%      69%      69%

Revenue by Market Segment
   Communication                     9%       7%       7%       8%       7%
   Consumer                         12%      16%      20%      14%      18%
   Industrial                       36%      31%      34%      34%      36%
   Aero/Military                    43%      46%      39%      44%      39%


Market segment numbers are based on our estimate of end uses by our
customers.

FLASH Technology products are defined as -- ProASIC, ProASIC Plus, ProASIC
3, ProASIC 3 Low Power, IGLOO, IGLOO Plus, and FUSION project families.

Investor Contact:
Maurice Carson
(650) 318-4700

Media Contact:
Anna del Rosario
(650) 318-4500