Technology Industry
Industry: Email Alert RSS FeedFinancial: National Semiconductor Reports Loss of 42 Cents Per Share Before One-time Charges for Fourth Quarter of Fiscal 1998
Edge: Work-Group Computing Report, June 15, 1998
3 months ended:
May 31, 1998 May 25, 1997
(excluding (National Core & Cyrix Total Company
one-time charges) (excluding as reported
one-time charges)
Net sales $ 510.0 $ 651.7 $ 670.5
Net income
(loss) $ (69.3) $ 57.4 $ (19.0)
Earnings (loss) per
share (diluted)$ ( 0.42) $ 0.36 $ (0.12)
All figures in millions of dollars, except per share amounts
Summary of results
12 months ended:
May 31, 1998 May 25, 1997
National Core & Cyrix National Core & Cyrix Total Company
(excluding (excluding As Reported
one-time charges) one-time charges)
Net sales $ 2,536.7 $ 2,231.5 $ 2,684.4
Net income $ 72.7 $ 96.2 $ 1.6
Earnings per
share (diluted)$ 0.44 $ 0.60 $ 0.01
All figures in millions of dollars, except per share amounts
PART I. FINANCIAL INFORMATION
NATIONAL SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(in millions, except per share amounts)
Three Months Ended Twelve Months Ended
May 31, May 25, May 31, May 25,
1998 1997 1998 1997
(Restated) (Restated)
Net sales $510.0 $670.5 $2,536.7 $2,684.4
Operating costs and expenses:
Cost of sales 405.0 392.6 1,651.7 1,672.5
Research and development 123.1 110.8 482.0 404.5
Selling, general and
administrative 78.5 96.1 353.2 448.9
Special items:
Merger costs - - 30.0 -
Restructuring of operations 63.8 69.9 63.8 134.2
Gain on sale of Fairchild - (40.6) (40.6)
In-process R&D charge 95.2 62.0 102.9 72.6
------ ------ -------- -------
Total operating costs
and expenses 765.6 690.8 2,683.6 2,692.1
------ ------ -------- -------
Operating loss (255.6) (20.3) (146.9) (7.7)
Interest income, net 2.5 8.5 22.3 6.1
Other income, net 1.7 6.1 24.9 18.7
------ ------ -------- -------
Income (loss) before
income taxes (251.4) (5.7) (99.7) 17.1
Income tax provision(benefit)(39.0) 13.3 (1.1) 15.5
------ ------ -------- -------
Net income (loss) $(212.4) $(19.0) $ (98.6) $ 1.6
====== ====== ======== =======
Earnings (loss) per share:
Basic $(1.29) $( .12) $( .60) $ .01
Diluted $(1.29) $( .12) $( .60) $ .01
Selected income statement ratios as a percentage of sales:
Gross margin 20.6% 41.4% 34.9% 37.7%
Research and development
exclude in-process R&D
charge 24.1% 16.5% 19.0% 15.1%
Selling, general and
administrative 15.4% 14.3% 13.9% 16.7%
Net income (41.6%) (2.8%) (3.9%) .1%
Effective tax rate (15.5%) n/m (1.1%) n/m
n/m: not meaningful
NATIONAL SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in millions)
May 31, May 25,
1998 1997
(Restated)
ASSETS
Current assets:
Cash and cash equivalents $ 460.8 $ 897.8
Short-term marketable investments 112.4 79.6
Receivables, net 208.5 281.0
Inventories 283.9 205.8
Deferred tax assets 166.2 173.3
Other current assets 76.4 99.9
-------- --------
Total current assets 1,308.2 1,737.4
Property, plant and equipment 2,939.7 2,420.4
Less accumulated depreciation (1,283.9) (1,071.4)
------- --------
Net property, plant and equipment 1,655.8 1,349.0
Other assets 136.7 124.4
-------- --------
Total assets $3,100.7 $3,210.8
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings and current
portion of long-term debt $ 53.9 $ 15.4
Accounts payable 237.0 265.5
Accrued expenses 310.9 306.8
Income taxes 191.8 238.1
------- --------
Total current liabilities 793.6 825.8
Long-term debt 390.7 460.5
Deferred income taxes 4.4 12.1
Other non-current liabilities 53.1 40.7
------- --------
Total liabilities 1,241.8 1,339.1
------- --------
Commitments and contingencies
Shareholders' equity:
Common stock 82.7 80.7
Additional paid-in capital 1,200.3 1,111.7
Retained earnings 575.9 679.3
------- --------
Total shareholders' equity 1,858.9 1,871.7
------- --------
Total liabilities and shareholders' equity$3,100.7 $3,210.8
NATIONAL SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(in millions)
Twelve Months Ended
May 31, May 25,
1998 1997
(Restated)
Cash flows from operating activities:
Net income (loss) $ (98.6) $ 1.6
Adjustments to reconcile net income (loss)
with net cash provided by operations:
Depreciation and amortization 300.6 258.1
Gain on disposition of Fairchild - (40.6)
Gain on investments (10.3) (0.7)
Loss on disposal of equipment 9.7 8.2
Tax benefit associated with stock
options 17.5 18.6
In-process research and development
charge 102.9 72.6
Merger costs 30.0 -
Restructuring of operations 63.8 134.2
Other, net 13.8 6.1
Changes in certain assets and liabilities, net:
Receivables 55.7 30.0
Inventories (60.6) 60.4
Other current assets (2.9) (17.3)
Accounts payable and accrued expenses (102.8) (6.5)
Current and deferred income taxes (42.1) (10.8)
Other non-current liabilities 12.3 (0.8)
------- -------
Net cash provided by operating activities 289.0 513.1
------- -------
Cash flows from investing activities:
Purchase of property, plant and equipment (622.0) (605.6)
Sale and maturity of marketable
investments 1,020.3 1,320.3
Purchase of marketable investments (1,051.5) (1,338.0)
Sale of investments 16.2 5.1
Disposition of Fairchild - 400.5
Sale of Fairchild notes receivable - 65.0
Business acquisitions, net of cash
acquired (96.4) (13.7)
Purchase of investments and other, net (28.4) (14.6)
------- -------
Net cash used by investing activities (761.8) (181.0)
------- -------
Cash flows from financing activities:
Issuance of 5.5% convertible
subordinated notes, less issuance costs - 126.5
Redemption of 5.5% convertible
subordinated notes (126.4) -
Issuance of debt 100.4 59.1
Repayment of debt (19.0) (165.9)
Issuance of common stock, net 63.2 59.3
------- --------
Net cash provided by financing activities 18.2 79.0
------- -------
Net change in cash and cash equivalents (454.6) 411.1
Adjustment to conform pooling of interests
for cash and cash equivalents at
beginning of year 17.6 -
Cash and cash equivalents at beginning of
period 897.8 486.7
------- -------
Cash and cash equivalents at end of period$ 460.8 $ 897.8
======= =======
PART I. FINANCIAL INFORMATION
EARNINGS PER SHARE (Unaudited)
(in millions, except per share amounts)
Three Months Ended Twelve Months Ended
------------------ -------------------
May 31, May 25, May 31, May 25,
1998 1997 1998 1997
(Restated) (Restated)
Earnings (loss) per share:
Basic ($1.29) ($ .12) ($ .60) $ .01
Diluted ($1.29) ($ .12) ($ .60) $ .01
Weighted average shares:
Basic 165.2 159.5 163.9 156.1
Diluted 165.2 159.5 163.9 159.1
Income (loss) used in basic
earnings (loss) per
common share
calculation ($212.4) ($19.0) ($98.6) $ 1.6
Income (loss) used in
diluted earnings
(loss) per share
(reflecting adjustment
for interest on
convertible notes when
dilutive) ($212.4) ($19.0) ($98.6) $ 1.6
As Restructure In-Process Excluding
Reported Charge R&D Charge Special
Charges
Pretax loss $ 251.4 ($ 63.8) ($ 95.2) ($ 92.4)
Tax benefit 39.0 ( 15.9) - 23.1
--------- --------- --------- ---------
Net loss ($ 212.4) $ 47.9 $ 95.2 ($ 69.3)
========= ========= ========= =========
Loss per
share ($ 1.29) $ .29 $ .58 ($ .42)
========= ========= ========= =========
National Core with Cyrix
Selected Financial Information
Three Months Ended
Total Special National
Company Items Core with
Incr(Decr) Cyrix
May 31, 1998:
Net sales $ 510.0 $ 510.0
Gross profit $ 105.0 $ 105.0
Gross margin 20.6% 20.6%
Research & development $ 123.1 $ 123.1
Selling, gen. & admin. $ 78.5 $ 78.5
Special items-net change $ 159.0 ($ 159.0) $ -
Net loss $ 212.4 ($ 143.1) $ 69.3
Loss per share-
diluted: $ 1.29 $ .42
Three Months Ended
Total Special Fairchild National
Company Items Core with
Incr(Decr) Cyrix
May 25, 1997:
Net sales $ 670.5 $ (18.8) $ 651.7
Gross profit $ 277.9 $ (10.7) $ 267.2
Gross margin 41.4% 41.0%
Research & development$ 110.8 $ (1.1) $ 109.7
Selling, gen. & admin.$ 96.1 $ (3.5) $ 92.6
Special items-net
change $ 91.3 ($ 91.3) $ -
Other income, net $ 6.1 ($ 4.2) $ .3 $ 2.2
Net loss (income) $ 19.0 ($ 80.8) $ 4.4 $ (57.4)
Loss (earnings) per share-
diluted: $ .12 $ ( .36)
National Core with Cyrix
Selected Financial Information
Twelve Months Ended
Total Special National
Company Items Core with
Incr(Decr) Cyrix
May 31, 1998:
Net sales $2,536.7 $2,536.7
Gross profit $ 885.0 $ 885.0
Gross margin 34.9% 34.9%
Research & development $ 482.0 $ 482.0
Selling, gen. & admin. $ 353.2 $ 353.2
Special items-net change $ 196.7 ($ 196.7) $ -
Net loss (income) $ 98.6 ($ 171.3) ($ 72.7)
Loss (earnings) per share-
diluted: $ .60 $ (.44)
Twelve Months Ended
Total Special Fairchild National
Company Items Core with
Incr(Decr) Cyrix
May 25, 1997:
Net sales $2,684.4 $ (452.9) $2,231.5
Gross profit $1,011.9 $ (137.4) $ 874.5
Gross margin 37.7% 39.2%
Research &
development $ 404.5 $ (15.1) $ 389.4
Selling, gen. &
admin. $ 448.9 $ (62.9) $ 386.0
Special items-net
change $ 166.2 ($ 166.2) $ -
Other income, net $ 18.7 ($ 4.2) $ 2.9 $ 17.4
Net income $ 1.6 $ 137.0 $ (42.4) $ 96.2
Earnings per share-
diluted: $ .01 $ .60
Other Income, Net
Components of other Three Months Ended Twelve Months Ended
income,net were: May 31, May 25, May 31, May 25,
(in millions) 1998 1997 1998 1997
(Restated) (Restated)
-------- -------- -------- --------
Net intellectual
property income $ 1.4 $ 2.1 $ 15.7 $ 10.1
Gain (loss) on
investments, net (1.0) (0.2) 9.2 0.8
Other 1.3 4.2 - 7.8
-------- -------- -------- --------
Total other income, net$ 1.7 $ 6.1 $ 24.9 $ 18.7
======== ======== ======== ========
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