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Synaptics Reports Record Revenue in Third Quarter Fiscal 2013

SANTA CLARA, Calif., April 25, 2013 /PRNewswire/ -- Synaptics (NASDAQ: SYNA), a leading developer of human interface solutions, today reported financial results for its third quarter ended March 31, 2013. 

Net revenue for the third quarter of fiscal 2013 was $163.3 million, an increase of 24% compared with $131.7 million for the comparable quarter last year.  Net income for the third quarter of fiscal 2013 was $36.4 million, or $1.07 per diluted share, and reflects the benefit of a non-recurring, non-cash tax item of $15.8 million, compared with net income of $11.4 million, or $0.33 per diluted share, for the comparable quarter last year. 

Non-GAAP net income for the third quarter of fiscal 2013 was $27.0 million, or $0.79 per diluted share, compared with non-GAAP net income of $17.9 million, or $0.51 per diluted share, for the third quarter of fiscal 2012.  (See attached table for a reconciliation of GAAP to non-GAAP financial measures.) 

"We are extremely pleased to report record revenue during the third quarter," stated Rick Bergman, President and CEO.  "The continued adoption of our solutions by a broad base of key customers is a testament to the strength of our technology leadership and has enabled us to diversify our business through increased penetration of the rapidly growing mobile touchscreen market.  As the market leader in capacitive touch solutions, we believe Synaptics is well-positioned to drive long-term, profitable growth."

Third Quarter 2013 Business Metrics

  • Revenue mix from mobile and PC products was approximately 64% and 36%, respectively.
  • Revenue from mobile products totaled $104.7 million and was up 57.2% year-over-year.  Mobile products revenue includes all touchscreen and video display products.
  • Revenue from PC products totaled $58.6 million, a decrease of 9.9% year-over-year.
  • Gross margin was 49.6%, an increase of 240 basis points year-over-year.

Cash at March 31, 2012 was $315.5 million.  Cash flow from operations for the third quarter of fiscal 2013 was $24.7 million.

Kathy Bayless, CFO, added, "Considering our backlog of approximately $124.0 million, customer forecasts, and the resulting expected product mix, we anticipate revenue to be in the range of $190.0 million to $205.0 million for the June quarter, an increase of 38% to 49% on a year-over-year basis.  Our strong June quarter backlog and outlook reflects a steep ramp of new designs across multiple mobile customers."

Earnings Call Information
The Synaptics third quarter fiscal 2013 teleconference and webcast is scheduled to begin at 2:00 p.m., Pacific Time, on Thursday, April 25, 2013, during which the company will provide forward-looking information. To participate on the live call, analysts and investors should dial 877-941-2068 at least ten minutes prior to the call.  Synaptics will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the company's Web site at www.synaptics.com.

About Synaptics Incorporated
As a leading developer of human interface solutions which enhance the user experience, Synaptics provides the broadest touch solutions portfolio in the industry.  The ClearPad™ family supports touchscreen solutions for devices ranging from entry-level mobile phones to flagship premium smartphones, tablets, and notebook PCs.  The TouchPad™ family, including ClickPad™ and ForcePad™, is integrated into the majority of today's notebook PCs.  Synaptics' wide portfolio also includes ThinTouch™, supporting thin and light keyboard solutions, as well as key technologies for next generation touch-enabled video and display applications.
(NASDAQ: SYNA) www.synaptics.com

Synaptics, ClearPad, TouchPad, ClickPad, ForcePad, ThinTouch, and the Synaptics logo are trademarks of Synaptics in the United States and/or other countries. All other marks are the property of their respective owners.

Use of Non-GAAP Financial Information
In evaluating its business, Synaptics considers and uses net income excluding share-based compensation and certain non-cash or non-recurring items as a supplemental measure of operating performance.  Net income excluding share-based compensation and certain non-cash or non-recurring items is not a measurement of the company's financial performance under GAAP and should not be considered as an alternative to GAAP net income. The company presents net income excluding share-based compensation and certain non-cash or non-recurring items because it considers it an important supplemental measure of its performance. The company believes this measure facilitates operating performance comparisons from period to period by eliminating potential differences in net income caused by the existence and timing of share-based compensation charges and certain non-cash or non-recurring items. Net income excluding share-based compensation and certain non-cash or non-recurring items has limitations as an analytical tool and should not be considered in isolation or as a substitute for the company's GAAP net income.  The principal limitations of this measure are that it does not reflect the company's actual expenses and may thus have the effect of inflating its net income and net income per share. 

Forward-Looking Statements
This press release contains "forward-looking" statements about Synaptics, as that term is defined under the federal securities laws.  Synaptics intends such forward-looking statements to be subject to the safe harbor created by those laws. Such forward-looking statements include, but are not limited to, statements regarding the company's belief that the continued adoption of its solutions by a broad base of key customers is a testament to the strength of its technology leadership and has enabled it to diversify its business through increased penetration of the rapidly growing mobile touchscreen market; the company's belief that it is the market leader in capacitive touch solutions and that it is well positioned to drive long-term, profitable growth; and the company's anticipated revenue for the June quarter, including its expectation that the June quarter outlook reflects a steep ramp of new designs across multiple mobile customers.  Synaptics cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements contained herein.  Such factors include, but are not limited to, (a) demand for Synaptics' products, (b) market demand for OEMs' products using Synaptics' solutions, (c) changing market demand trends in the markets Synaptics serves, (d) the success of Synaptics' customers' products that utilize Synaptics' product solutions, (e) the development and launch cycles of Synaptics' customers' products, (f) market pressures on selling prices, (g) changes in product mix, (h) the market acceptance of Synaptics' product solutions compared with competitors' solutions, (i) general economic conditions, including consumer confidence and demand, and (j) other risks as identified from time to time in Synaptics' SEC reports, including Quarterly Reports on Form 10-Q and the Annual Report on Form 10-K for the fiscal year ended June 30, 2012. All forward-looking statements are based on information available to Synaptics on the date hereof, and Synaptics assumes no obligation to update such statements.

For more information contact:

Jennifer Jarman
The Blueshirt Group
415-217-5866            
jennifer@blueshirtgroup.com

 

(Tables to Follow)

 

 

SYNAPTICS INCORPORATED

 CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)











March 31,

June 30,



2013

2012






Assets





Current assets:




Cash and cash equivalents                                                                 

$ 315,513

$ 305,005

Accounts receivables, net of allowances of $567

106,700

104,140

Inventories                                                                              

43,911

31,667

Prepaid expenses and other current assets                                                     

4,873

5,365

Total current assets                                                                    

470,997

446,177



Property and equipment at cost, net                                                               

47,988

24,903

Goodwill                                                                             

20,695

18,995

Purchased intangibles

13,372

12,800

Non-current auction rate securities

15,801

15,321

Other assets                                                                                 

27,939

23,309

Total assets                                                                              

$ 596,792

$ 541,505


Liabilities and stockholders' equity


Current liabilities:



Accounts payable                                                                          

$  60,097

$  55,220

Accrued compensation                                                                      

16,321

12,642

Income taxes payable

11,512

11,221

Other accrued liabilities                                                                    

34,365

26,515

Total current liabilities                                                                  

122,295

105,598






Notes payable

2,305

2,305

Other liabilities                                                                            

17,518

36,812






Commitments and contingencies










Stockholders' equity:



Preferred stock; 

    $.001 par value; 10,000,000 shares authorized; 

        no shares issued and outstanding







-

-

Common stock;

    $.001 par value; 120,000,000 shares authorized;  

        49,446,155 and 48,680,348 shares issued, and 32,421,623 and 

        32,896,256 shares outstanding, respectively











49

49

Additional paid in capital

504,440

471,569

Less:  17,024,532 and 15,784,092 treasury shares, respectively, at cost

(445,165)

(413,885)

Accumulated other comprehensive income

4,678

1,998

Retained earnings

390,672

337,059

Total stockholders' equity                                                                

454,674

396,790

Total liabilities and stockholders' equity                                              

$ 596,792

$ 541,505

 

 

SYNAPTICS INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)













Three Months Ended

Nine Months Ended


March 31,

March 31,


2013

2012

2013

2012









Net revenue                                                 

$   163,324

$   131,705

$   433,405

$   410,621

Cost of revenue                             

82,241

69,525

222,722

218,458

Gross margin                                                  

81,083

62,180

210,683

192,163

Operating expenses








Research and development               

36,740

29,415

103,799

87,478

Selling, general, and administrative

20,183

18,031

58,099

52,461

Acquired intangibles amortization

262

-

763

-

Change in contingent consideration

237

-

1,100

-

Total operating expenses                                       

57,422

47,446

163,761

139,939









Operating income                                   

23,661

14,734

46,922

52,224

Interest income

197

231

640

682

Interest expense                                                

(4)

(4)

(13)

(13)

Impairment recovery on investments

-

46

-

59

Income before (benefit)/provision for income taxes                 

23,854

15,007

47,549

52,952

(Benefit)/provision for income taxes             

(12,592)

3,561

(6,064)

11,108

Net income                                         

$    36,446

$    11,446

$    53,613

$    41,844









Net income per share:








Basic                                                      

$      1.13

$      0.34

$      1.65

$      1.27

Diluted                                                     

$      1.07

$      0.33

$      1.58

$      1.22









Shares used in computing net income per share:








Basic                                                          

32,234

33,389

32,552

32,935

Diluted                                                      

34,135

35,179

33,843

34,374

 

 

SYNAPTICS INCORPORATED

Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures

(In thousands, except per share data)

(Unaudited)













Three Months Ended

Nine Months Ended


March 31,

March 31,


2013

2012

2013

2012









GAAP gross margin

$ 81,083

$ 62,180

$ 210,683

$ 192,163

Share-based compensation

249

313

690

903

Non-GAAP gross margin

$ 81,332

$ 62,493

$ 211,373

$ 193,066




















GAAP gross margin - percentage of revenue

49.6%

47.2%

48.6%

46.8%

Share-based compensation - percentage of revenue

0.2%

0.2%

0.2%

0.2%

Non-GAAP gross margin - percentage of revenue

49.8%

47.4%

48.8%

47.0%




















GAAP research and development expense

$ 36,740

$ 29,415

$ 103,799

$  87,478

Share-based compensation

(3,993)

(3,769)

(11,783)

(11,209)

Non-GAAP research and development expense

$ 32,747

$ 25,646

$  92,016

$  76,269




















GAAP selling, general, and administrative expense

$ 20,183

$ 18,031

$  58,099

$  52,461

Share-based compensation

(3,991)

(4,915)

(12,233)

(13,551)

Non-GAAP selling, general, and administrative expense

$ 16,192

$ 13,116

$  45,866

$  38,910




















GAAP operating income

$ 23,661

$ 14,734

$  46,922

$  52,224

Acquired intangibles amortization

262

-

763

-

Change in contingent consideration

237

-

1,100

-

Share-based compensation

8,233

8,997

24,706

25,663

Non-GAAP operating income

$ 32,393

$ 23,731

$  73,491

$  77,887




















GAAP net income

$ 36,446

$ 11,446

$  53,613

$  41,844

Impairment recovery on investments

-

(46)

-

(59)

Acquired intangibles amortization

262

-

763

-

Change in contingent consideration

237

-

1,100

-

Share-based compensation

8,233

8,997

24,706

25,663

Tax adjustments

(18,168)

(2,539)

(22,745)

(7,419)

Non-GAAP net income

$ 27,010

$ 17,858

$  57,437

$  60,029




















GAAP net income per share - diluted

$   1.07

$   0.33

$    1.58

$    1.22

Impairment recovery on investments

-

-

-

-

Acquired intangibles amortization

0.01

-

0.02

-

Change in contingent consideration

0.01

-

0.03

-

Share-based compensation

0.24

0.25

0.73

0.75

Tax adjustments

(0.54)

(0.07)

(0.66)

(0.22)

Non-GAAP net income per share - diluted

$   0.79

$   0.51

$    1.70

$    1.75

SOURCE Synaptics

News Provided by Acquire Media

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This website contains forward-looking statements that are subject to the safe harbors created under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business, and can be identified by the fact that they do not relate strictly to historical or current facts. Such forward-looking statements may include words such as "expect," "anticipate," "intend," "believe," "estimate," "plan," "target," "strategy," "continue," "may," "will," "should," variations of such words, or other words and terms of similar meaning. All forward-looking statements reflect our best judgment and are based on several factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Such factors include, but are not limited to, the risks as identified in the "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business" sections of our Annual Report on Form 10-K for our most recent fiscal year, and other risks as identified from time to time in our Securities and Exchange Commission reports. Forward-looking statements are based on information available to us on the date hereof, and we do not have, and expressly disclaim, any obligation to publicly release any updates or any changes in our expectations, or any change in events, conditions, or circumstances on which any forward-looking statement is based. Our actual results and the timing of certain events could differ materially from the forward-looking statements. These forward-looking statements do not reflect the potential impact of any mergers, acquisitions, or other business combinations that had not been completed as of the date of this filing.

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