Maxim Integrated Reports Results For The Third Quarter Of Fiscal 2016

- Revenue: $555 million

(PRNewswire) — Maxim Integrated Products, Inc. (NASDAQ: MXIM) reported net revenue of $555 million for its third quarter of fiscal 2016 ended March 26, 2016, a 9% increase from the $511 million revenue recorded in the prior quarter, and a 4% decrease from the same quarter of last year.

 Logo for Maxim Integrated Products Inc.

Tunc Doluca, President and Chief Executive Officer, commented, "Our third quarter financial performance was in line with our expectations, and we achieved additional milestones in our $180 million cost reduction plan." Mr. Doluca continued, "In our June quarter, we expect seasonal growth in Automotive and core Industrial, and a modest increase in Communications and Data Center. We are pleased with our design win momentum in high-performance power management and differentiated analog products, benefitting from our focused product portfolio."

Fiscal Year 2016 Third Quarter Results
Based on Generally Accepted Accounting Principles (GAAP), diluted earnings per share in the March quarter was a $0.48 profit. The results were affected by pre-tax special items which primarily consisted of a $59 million gain on sale of a business, $14 million in charges related to acquisitions, and $10 million in charges related to restructuring activities. GAAP earnings per share, excluding special items was $0.41. An analysis of GAAP versus GAAP excluding special items is provided in the last table of this press release.

Cash Flow Items
At the end of the third quarter of fiscal 2016, total cash, cash equivalents and short term investments were $1.86 billion, an increase of $87 million from the prior quarter. Notable items included:

  • Cash flow from operations: $168 million
  • Net capital expenditures: $17 million
  • Proceeds from sale of business: $105 million
  • Dividends: $86 million ($0.30 per share)
  • Stock repurchases: $84 million

Business Outlook
The Company's 90-day backlog at the beginning of the June quarter of 2016 was $370 million. Based on the beginning backlog and expected turns, results for the June 2016 quarter are expected to be as follows:

  • Revenue: $555 million to $595 million
  • Gross Margin: 59% to 61% GAAP (62% to 64% excluding special items)
  • EPS: $0.40 to $0.46 GAAP ($0.45 to $0.51 excluding special items)

Maxim Integrated's business outlook does not include the potential impact of any special items related to restructuring activity, acquisitions, or other business combinations that may be completed during the quarter.

Dividend
A cash dividend of $0.30 per share will be paid on June 2, 2016, to stockholders of record on May 19, 2016.

Conference Call
Maxim Integrated has scheduled a conference call on April 21 at 2:00 p.m. Pacific Time to discuss its financial results for the third quarter of fiscal 2016 and its business outlook. To listen via telephone, dial (866) 802-4305 (toll free) or (703) 639-1317. This call will be webcast by Shareholder.com and can be accessed at the Company's website at investor.maximintegrated.com.

A presentation summarizing financial information to be discussed on the conference call is posted at investor.maximintegrated.com.



CONSOLIDATED STATEMENTS OF INCOME



(Unaudited)





Three Months Ended





March 26, 


December 26, 


March 28, 





2016


2015


2015





(in thousands, except per share data)



Net revenues


$      555,252


$              510,831


$      577,263



Cost of goods sold (1) (2)


236,411


218,662


261,995



Gross margin


318,841


292,169


315,268



Operating expenses:









Research and development


119,178


113,100


123,913



Selling, general and administrative


71,778


73,643


75,766



Intangible asset amortization


2,538


3,538


3,977



Impairment of long-lived assets 


506


1,950


5,522



Severance and restructuring expenses


2,552


10,652


2,824



Other operating expenses (income), net (3)


(55,419)


(247)


(2,184)



Total operating expenses (income), net


141,133


202,636


209,818



Operating income (loss)


177,708


89,533


105,450



Interest and other income (expense), net 


(6,373)


(9,593)


(5,534)



Income (loss) before provision for income taxes


171,335


79,940


99,916



Income tax provision (benefit) 


31,525


12,471


20,483



Net income (loss)


$      139,810


$                67,469


$        79,433












Earnings (loss) per share:









Basic


$0.49


$0.24


$0.28



Diluted


$0.48


$0.23


$0.28












Shares used in the calculation of earnings (loss) per share:









Basic


285,854


285,526


283,418



Diluted


289,783


290,521


288,840












Dividends paid per share


$            0.30


$                    0.30


$            0.28





















SCHEDULE OF SPECIAL ITEMS



(Unaudited)





Three Months Ended





March 26, 


December 26, 


March 28, 





2016


2015


2015





(in thousands)



Cost of goods sold:









Intangible asset amortization


$        11,829


$                14,734


$        18,750



Accelerated depreciation (1)


4,066


2,032


9,834



Other cost of goods sold (2)


6,123


-


-



  Total 


$        22,018


$                16,766


$        28,584












 Operating expenses: 









Intangible asset amortization


$          2,538


$                  3,538


$          3,977



Impairment of long-lived assets 


506


1,950


5,522



Severance and restructuring 


2,552


10,652


2,824



Other operating expenses (income), net (3)


(55,419)


(247)


(2,184)



  Total 


$      (49,823)


$                15,893


$        10,139












Interest and other expense (income), net 


$             (45)


$                     595


$                  -



 Total 


$             (45)


$                     595


$                  -












Income tax provision (benefit) :









 Fiscal year 2015 research & development tax credits 


$                  -


$                 (2,475)


$                  -



  Total 


$                  -


$                 (2,475)


$                  -















(1) Includes building and equipment accelerated depreciation related to San Jose and Dallas manufacturing facilities.



(2) Includes expense related to patent license settlement.



(3) Includes gain on sale of energy metering business during the third quarter of fiscal year 2016.







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