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8-K - FORM 8-K - SMART Modular Technologies (WWH), Inc. | c19029e8vk.htm |
For More Information
Investor Contacts:
The Blueshirt Group for SMART Modular Technologies
415-217-7722
Suzanne@blueshirtgroup.com
CFO, Senior Vice President
SMART Modular Technologies
510-624-8134
Barry.Zwarenstein@smartm.com
Third Quarter Fiscal 2011 Results
| Net sales of $164.5 million | ||
| Gross profit of $32.4 million | ||
| GAAP diluted EPS of $0.03 | ||
| Non-GAAP diluted EPS of $0.10 | ||
| Adjusted EBITDA of $17.8 million |
Additional Information and Where to Find It
All parties desiring details regarding the previously announced merger transaction are urged to review the definitive merger agreement available on the Companys website at http://www.smartm.com, and the SECs website at http://www.sec.gov. In connection with the proposed transaction, SMART has filed with the SEC a preliminary proxy statement and other documents relating to the transaction and will file with the SEC a definitive proxy statement, and may file with the SEC other documents regarding the proposed transaction. INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THE PROXY STATEMENT AND OTHER FILED DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Shareholders will be able to obtain a free-of-charge copy of the proxy statement and other relevant documents (when available) filed with the SEC from the SECs website at http://www.sec.gov. Shareholders will also be able to obtain a free-of charge copy of the proxy statement and other relevant documents (when available) by directing a request by mail or telephone to The Blueshirt Group., Attention: Suzanne Craig or from SMARTs website, http://www.smartm.com. SMART and certain of its directors, executive officers and other members of management and employees may, under the rules of the SEC, be deemed to be participants in the solicitation of proxies from stockholders of SMART in favor of the proposed merger. Information regarding SMARTs directors and executive officers is contained in SMARTs definitive proxy statement filed with the SEC on December 3, 2010 (the Annual General Meeting Proxy Statement). Additional information regarding the interests of such potential participants will be included in the proxy statement and the other relevant documents filed and to be filed with the SEC (when available).
Reconciliation of Non-GAAP Financial Measures
(In thousands, except per share data; unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
May 27, | February 25, | May 28, | May 27, | May 28, | ||||||||||||||||
2011 | 2011 | 2010 | 2011 | 2010 | ||||||||||||||||
Net income |
$ | 2,272 | $ | 171 | $ | 14,917 | $ | 10,410 | $ | 35,591 | ||||||||||
Add: |
||||||||||||||||||||
Stock-based compensation expense charged
to operating expenses, net of tax |
2,200 | 2,232 | 1,896 | 6,565 | 5,358 | |||||||||||||||
Acquisition costs, no tax effect |
3,533 | | | 3,533 | | |||||||||||||||
Restructuring charges, no tax effect |
480 | 2,831 | | 3,311 | | |||||||||||||||
Technology access charge, no tax effect |
| | | 7,534 | | |||||||||||||||
Display business divestiture, no tax effect |
| | 486 | | 486 | |||||||||||||||
Gain from insurance settlement, no tax effect |
(1,435 | ) | | | (1,435 | ) | | |||||||||||||
Gain from legal settlement, no tax effect |
| | | | (3,044 | ) | ||||||||||||||
Gain from repurchase of notes, no tax effect |
| | | | (1,178 | ) | ||||||||||||||
Loan fees written off on repurchase of notes,
no tax effect |
| | | | 353 | |||||||||||||||
Non-GAAP net income |
$ | 7,050 | $ | 5,234 | $ | 17,299 | $ | 29,918 | $ | 37,566 | ||||||||||
Non-GAAP net income per diluted share |
$ | 0.10 | $ | 0.08 | $ | 0.26 | $ | 0.45 | $ | 0.58 | ||||||||||
Shares used in computing non-GAAP net
income per diluted share: |
67,648 | 66,087 | 65,502 | 66,498 | 64,843 | |||||||||||||||
Net income |
$ | 2,272 | $ | 171 | $ | 14,917 | $ | 10,410 | $ | 35,591 | ||||||||||
Interest expense, net |
(179 | ) | 230 | 837 | 762 | 3,663 | * | |||||||||||||
Income taxes |
5,444 | 2,557 | 7,354 | 13,340 | 20,504 | |||||||||||||||
Depreciation and amortization |
5,452 | 5,585 | 4,250 | 16,935 | 11,779 | |||||||||||||||
EBITDA |
12,989 | 8,543 | 27,358 | 41,447 | 71,537 | |||||||||||||||
Adjustments: |
||||||||||||||||||||
Stock-based compensation expense charged
to operating expenses |
2,212 | 2,248 | 1,908 | 6,605 | 5,393 | |||||||||||||||
Acquisition costs |
3,533 | | | 3,533 | | |||||||||||||||
Restructuring charges |
480 | 2,831 | | 3,311 | | |||||||||||||||
Technology access charge |
| | | 7,534 | | |||||||||||||||
Display business divestiture |
| | 486 | | 486 | |||||||||||||||
Gain from insurance settlement |
(1,435 | ) | | | (1,435 | ) | | |||||||||||||
Gain from legal settlement |
| | | | (3,044 | ) | ||||||||||||||
Gain from repurchase of notes |
| | | | (1,178 | ) | ||||||||||||||
Adjusted EBITDA |
$ | 17,779 | $ | 13,622 | $ | 29,752 | $ | 60,995 | $ | 73,194 | ||||||||||
* | Includes $353K of loan fees written off on repurchase of notes. |
Condensed Consolidated Statements of Income
(In thousands, except per share data; unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
May 27, | February 25, | May 28, | May 27, | May 28, | ||||||||||||||||
2011 | 2011 | 2010 | 2011 | 2010 | ||||||||||||||||
Net sales |
$ | 164,479 | $ | 170,549 | $ | 201,235 | $ | 551,387 | $ | 484,438 | ||||||||||
Cost of sales |
132,100 | 142,024 | 155,738 | 446,474 | 368,162 | |||||||||||||||
Gross profit |
32,379 | 28,525 | 45,497 | 104,913 | 116,276 | |||||||||||||||
Operating expenses: |
||||||||||||||||||||
Research and development |
7,652 | 7,852 | 6,657 | 23,664 | 17,606 | |||||||||||||||
Selling, general and administrative |
15,224 | 15,169 | 16,340 | 45,241 | 44,037 | |||||||||||||||
Acquisition costs |
3,533 | | | 3,533 | | |||||||||||||||
Restructuring charges |
480 | 2,831 | | 3,311 | | |||||||||||||||
Technology access charge |
| | | 7,534 | | |||||||||||||||
Total operating expenses |
26,889 | 25,852 | 22,997 | 83,283 | 61,643 | |||||||||||||||
Income from operations |
5,490 | 2,673 | 22,500 | 21,630 | 54,633 | |||||||||||||||
Interest income (expense), net |
179 | (230 | ) | (837 | ) | (762 | ) | (3,663 | ) | |||||||||||
Other income, net |
2,047 | 285 | 608 | 2,882 | 5,125 | |||||||||||||||
Total other income (expense) |
2,226 | 55 | (229 | ) | 2,120 | 1,462 | ||||||||||||||
Income before provision for income taxes |
7,716 | 2,728 | 22,271 | 23,750 | 56,095 | |||||||||||||||
Provision for income taxes |
5,444 | 2,557 | 7,354 | 13,340 | 20,504 | |||||||||||||||
Net income |
$ | 2,272 | $ | 171 | $ | 14,917 | $ | 10,410 | $ | 35,591 | ||||||||||
Net income per share, basic |
$ | 0.04 | $ | 0.00 | $ | 0.24 | $ | 0.16 | $ | 0.57 | ||||||||||
Net income per share, diluted |
$ | 0.03 | $ | 0.00 | $ | 0.23 | $ | 0.16 | $ | 0.55 | ||||||||||
Shares used in computing net income
per ordinary share |
64,137 | 63,178 | 62,463 | 63,405 | 62,216 | |||||||||||||||
Shares used in computing net income
per diluted share |
67,648 | 66,087 | 65,502 | 66,498 | 64,843 | |||||||||||||||
Condensed Consolidated Balance Sheets
(Unaudited)
May 27, | August 27, | |||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 131,737 | $ | 115,474 | ||||
Accounts receivable, net of allowances of $1,778 and
$1,660
as of May 27, 2011 and August 27, 2010, respectively |
177,664 | 208,377 | ||||||
Inventories |
98,071 | 112,103 | ||||||
Prepaid expense and other current assets |
22,670 | 33,488 | ||||||
Total current assets |
430,142 | 469,442 | ||||||
Property and equipment, net |
52,505 | 46,221 | ||||||
Other non-current assets |
32,719 | 21,217 | ||||||
Other intangible assets, net |
5,744 | 6,460 | ||||||
Goodwill |
1,061 | 1,061 | ||||||
Total assets |
$ | 522,171 | $ | 544,401 | ||||
LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 91,441 | $ | 151,885 | ||||
Accrued liabilities |
21,977 | 29,318 | ||||||
Short-term debt |
55,072 | | ||||||
Total current liabilities |
168,490 | 181,203 | ||||||
Other long-term liabilities |
7,298 | 4,546 | ||||||
Long-term debt |
| 55,072 | ||||||
Total liabilities |
175,788 | 240,821 | ||||||
Shareholders equity: |
||||||||
Ordinary shares |
11 | 10 | ||||||
Additional paid in capital |
133,548 | 118,123 | ||||||
Accumulated other comprehensive income |
28,625 | 11,658 | ||||||
Retained earnings |
184,199 | 173,789 | ||||||
Total shareholders equity |
346,383 | 303,580 | ||||||
Total liabilities and shareholders equity |
$ | 522,171 | $ | 544,401 | ||||
Summary Cash Flow Information
(Unaudited)
Nine Months Ended | ||||||||
May 27, | May 28, | |||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Net cash provided by (used in) operating
activities |
$ | 19,804 | $ | (4,136 | ) | |||
Net cash used in investing activities |
$ | (15,773 | ) | $ | (15,034 | ) | ||
Net cash provided by (used in) financing
activities |
$ | 8,821 | $ | (23,616 | ) |