Editor Contact
Lance M. Lissner
Vice President - Business Development & Investor Relations
Altera Corporation
San Jose, CA
(408) 544-7707 |
|
Release Date: January 19, 2000 |
Altera Reports Quarterly & Annual Results
Fourth Quarter Sales Increase 10% Sequentially & 38% Annually
Total Year Sales Increase 28%
San Jose, Calif., January 19, 2000 - Altera Corporation (Nasdaq: ALTR) today reported record fourth quarter sales of $237.3 million, up 10% from the previous quarter and up 38% over the same period last year. Total year sales were $836.6 million, an increase of 28% from 1998. Fourth quarter sales growth of 10% was achieved by record sales in all geographic channels with sequential gains of 9% in North America, 18% in Europe, 10% in Japan and 4% in Asia/Pacific. New and mainstream products made up 73% of sales for the quarter. New products were 38% of sales, grew 25% sequentially and increased 200% from the same period last year. Mainstream products were 35% of sales and grew 10% sequentially. Mature product sales declined 9% sequentially.
Fourth quarter net income of $70.4 million, or $0.34 per diluted share, included a $10.3 million pre-tax gain on the sale of the MAX® 5000 family to Cypress Semiconductor Corp. and also a $1.0 million pre-tax charge for the write-down of certain fixed assets. Excluding these one-time effects, income was a record $64.0 million or 27% of sales; an increase of 15% from the prior quarter and a 51% increase over the fourth quarter of 1998. Income, excluding the one-time effects was $0.31 per diluted share up $0.04 from the $0.27 reported in the third quarter of 1999 and up $0.10 from the $0.21 reported in the fourth quarter of 1998. Fourth quarter earnings included after-tax charges of $1.3 million representing the Company's share in the start-up losses of WaferTech. Altera added $59.5 million of cash to its balance sheet during the quarter after the repurchase of 1.3 million shares of its common stock for $59.9 million, an additional investment in WaferTech of $23.0 million, and routine capital expenditures of $10.8 million.
For the year, new products grew 222% to 30% of total sales and mainstream products increased 35% to 36% of total sales. For the year, Asia/Pacific sales increased 76%, Japan increased 34%, North America increased 31% and Europe increased 7%. Total year net income was $224.0 million or $1.08 per diluted share, up from $0.78 per diluted share in 1998.
Altera continued to enhance its leadership position in System-on-a-Programmable-ChipTM
(SOPCTM) solutions:
- Altera initiated the rollout of the 1.8-volt APEXTM 20KE family with the introduction of the EP20K400E device, which provides 400,000 usable gates (one million maximum system gates) including 212,992 bits of embedded RAM. It features on-chip content-addressable memory (CAM), low-voltage differential signaling (LVDS), and phase locked loops (PLLs), enabling designers to create true System-on-a-Programmable-Chip (SOPC) silicon for leading-edge communications applications such as Layer 3 routers and switches, wideband CDMA baseband signal processing, and ATM cell processing and traffic management.
- Altera became the first semiconductor company to introduce a PCI-X intellectual property (IP) core for programmable logic devices. The PCI-X technology is a compatible extension of the existing PCI (peripheral component interface) bus. The 64-bit PCI-X architecture runs at speeds up to 133-MHz, providing transfer rates above one gigabyte per second, up to four times the speed of the most common PCI bus technology. Additionally, Altera was selected as the first programmable logic company to participate in the Compaq Computer Corporation (NYSE: CPQ) Golden Master Program which guarantees Altera early access to Compaq's PCI-X technology.
Also in the fourth quarter, Altera announced the opening of its Programmable eStore web site. This site allows customers to purchase the full range of Altera software subscriptions, and license Intellectual Property MegaCoreTM functions through the Internet. IP customers can download both the function and the license file for immediate deployment in designs.
Rodney Smith, President and CEO, stated, "Our sales growth this quarter is evidence that our momentum in the marketplace is increasing -- excluding the MAX® 5000 family, which was sold to Cypress in October, our sequential sales growth was 12%. We experienced strong growth and achieved record results in all of our sales channels. New product sales growth was 25% and balanced across the new product families. We introduced the first member of the APEX 20KE family, and our customers are embracing the features and performance of this family using the latest release of our QuartusTM development software."
Fax on Demand:
Copies of Altera's announcement are available from its fax-on-demand service. In the U.S. and Canada to request a copy call 1-800-789-ALTR. International users may dial their local International Access Code followed by 1-408-894-0466.
Altera Corporation, The Programmable Solutions CompanyTM, was founded in 1983 and is a leading supplier of programmable logic devices and associated logic development software tools. Programmable logic devices are semiconductor chips that may be programmed on-site, using software tools that run on personal computers or engineering workstations. User benefits include ease of use, lower risk, and fast time-to-market. Altera's CMOS-based programmable logic devices address high-speed, high-density and low-power applications in the telecommunications, data communications, computer peripheral, and industrial markets. Altera common stock is traded on the Nasdaq Stock Market under the symbol ALTR. More information on Altera may be obtained on the Internet at http://www.altera.com.
ALTERA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
| |
(Unaudited)
|
|
|
| |
THREE MONTHS ENDED
--------------------------------------- |
YEAR ENDED
--------------------------- |
|
|
Dec. 31
1999
======== |
Dec. 31
1998
======== |
Sept. 30
1999
======== |
Dec. 31
1999
======== |
Dec. 31
1998
======== |
|
Net sales |
$237,320 |
$172,432 |
$215,121 |
$836,623 |
$654,342 |
|
Costs & expenses: |
|
|
|
|
|
|
Cost of sales |
83,193 |
65,182 |
76,707 |
301,322 |
249,474 |
|
Research and development |
25,967 |
16,001 |
23,213 |
86,065 |
59,864 |
|
Selling, general
and administrative |
40,369
---------- |
29,309
---------- |
36,784
---------- |
143,214
---------- |
113,161
---------- |
|
Total costs and expenses |
149,529
---------- |
110,492
---------- |
136,704
---------- |
530,601
---------- |
422,499
---------- |
|
|
|
|
|
|
|
Income from operations |
87,791 |
61,940 |
78,417 |
306,022 |
231,843 |
|
Interest & other income, net |
18,445
---------- |
5,458
---------- |
7,987
---------- |
37,055
---------- |
12,340
---------- |
|
|
|
|
|
|
|
Income before income taxes and
equity investment |
106,236 |
67,398 |
86,404 |
343,077 |
244,183 |
|
Provision for income taxes |
34,526
---------- |
21,905
---------- |
28,081
---------- |
111,499
---------- |
79,356
---------- |
|
|
|
|
|
|
|
Income before equity investment |
71,710 |
45,493 |
58,323 |
231,578 |
164,827 |
|
Equity in loss of WaferTech |
(1,341)
---------- |
(3,000)
---------- |
(2,751)
---------- |
(7,584)
---------- |
(10,440)
---------- |
|
|
|
|
|
|
|
Net income |
$ 70,369
======== |
$ 42,493
======== |
$ 55,572
======== |
$223,994
======== |
$154,387
======== |
|
Earnings per share:
Basic |
$ 0.35
======== |
$ 0.22
======== |
$ 0.28
======== |
$ 1.13
======== |
$ 0.83
======== |
|
Diluted |
$ 0.34
======== |
$ 0.21
======== |
$ 0.27
======== |
$ 1.08
======== |
$ 0.78
======== |
|
Shares used in computation:
Basic |
199,390
======== |
194,828
======== |
198,880
======== |
198,079
======== |
186,986
======== |
|
Diluted |
208,913
======== |
203,798
======== |
208,175
======== |
207,464
======== |
203,178
======== |
|
Tax rate |
32.5% |
32.5% |
32.5% |
32.5% |
32.5% |
|
% of Sales: |
|
|
|
|
|
|
Gross margin |
65% |
62% |
64% |
64% |
62% |
|
Research and development |
11% |
9% |
11% |
10% |
9% |
|
Selling, general & administrative |
17% |
17% |
17% |
17% |
17% |
|
Income from operations |
37% |
36% |
36% |
37% |
36% |
|
Net income |
30% |
25% |
26% |
27% |
24% |
ALTERA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
| |
|
(Unaudited) |
|
| |
Dec. 31
1999
======= |
Sept. 30
1999
======= |
Dec. 31
1998
======== |
|
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
Cash and short-term investments |
$ 845,666 |
$ 786,169 |
$ 579,106 |
|
Accounts receivable, net |
90,101 |
91,164 |
56,138 |
|
Inventories |
64,027 |
58,835 |
69,869 |
|
Other assets |
107,091
----------- |
100,409
----------- |
94,420
----------- |
|
Total current assets |
1,106,885 |
1,036,577 |
799,533 |
|
Property and equipment, net |
155,217 |
152,082 |
152,320 |
|
Investments & intangibles |
177,497
------------ |
156,541
------------ |
141,478
------------ |
| |
$ 1,439,599
======== |
$ 1,345,200
======== |
$ 1,093,331
======== |
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
Accounts payable and current liabilities |
$ 93,766 |
$ 54,518 |
$ 50,450 |
|
Deferred income on sales to distributors |
227,760
----------- |
204,867
----------- |
161,160
----------- |
|
Total current liabilities |
321,526 |
259,385 |
211,610 |
|
Stockholders' equity |
1,118,073
======== |
1,085,815
======== |
881,721
======== |
| |
$ 1,439,599
======== |
$ 1,345,200
======== |
$ 1,093,331
======== |
|
|
|
|
|
Key Ratios & Information |
|
|
|
| |
|
|
|
|
Current Assets/Current Liabilities |
3:1 |
4:1 |
4:1 |
|
Liabilities/Equity |
1:4 |
1:4 |
1:4 |
|
Annualized Quarterly Return on Equity |
26% |
21% |
20% |
|
Quarterly Depreciation Expense, Net |
7,639 |
6,633 |
6,249 |
|
Quarterly Capital Expenditures |
10,774 |
8,094 |
5,587 |
|
Annualized Sales per Employee |
689 |
645 |
605 |
| |
|
|
|
| |
|
|
|
| Revenue by Market Segment |
| |
Q2'99 |
Q3'99 |
Q4'99 |
|
|
| Communications |
64% |
67% |
70% |
|
· Serve over 13,000 customers |
| EDP |
16% |
16% |
14% |
|
· Three distributors in North America -- |
| Industrial |
13% |
12% |
10% |
|
85 branch locations |
| Consumer |
3% |
2% |
3% |
|
· 44% of sales in export markets |
| Other |
4% |
3% |
3% |
|
· Distributors in all European countries
and major Asian markets |
| Revenue: Product Family |
|
Channel |
| |
Q2'99 |
Q3'99 |
Q4'99 |
|
|
Q2'99 |
Q3'99 |
Q4'99 |
| New |
27% |
33% |
38% |
|
North America |
56% |
57% |
56% |
| Mainstream |
37% |
35% |
35% |
|
Europe |
18% |
19% |
20% |
| Mature |
29% |
26% |
21% |
|
Japan |
20% |
18% |
18% |
| Other |
7% |
6% |
6% |
|
Asia/Pacific |
6% |
6% |
6% |
| Total |
100% |
100% |
100% |
|
International |
44% |
43% |
44% |
| |
===== |
===== |
===== |
|
Total |
100%
===== |
100%
===== |
100%
===== |
Financial Highlights: (In thousands)
| |
1995 |
1996 |
1997 |
1998 |
1999 |
| Net sales |
$401,598 |
$497,306 |
$631,114 |
$654,342 |
$836,623 |
Income before effect of
accounting change |
86,871 |
109,135 |
151,517 |
154,387 |
223,994 |
| Cash and investments |
365,219 |
280,850 |
377,569 |
579,106 |
845,666 |
| Total assets |
715,554 |
778,212 |
952,518 |
1,093,331 |
1,439,599 |
| Stockholders' equity |
255,189 |
370,245 |
536,687 |
881,721 |
1,118,073 |
| ROE |
42% |
35% |
33% |
22% |
22% |
Ownership:
| Management/Directors/Employees: |
5% |
|
Corporate Office: San Jose, CA |
| Institutional Holdings: |
85% |
|
|
| Retail/Other: |
10% |
|
Employees: 1,398 |
Research Coverage by 15 Most Active Market Makers
| Goldman Sachs | Joe Moore | (212) 902-6834 |
| Salomon Smith Barney | Clark Westmont | (415) 955-4933 |
| Morgan Stanley | Mark Edelstone | (415) 576-2381 |
| Credit Suisse First Boston | Tim Mahon | (415) 836-7774 |
| Merrill Lynch | Eric Rothdeutsch | (212) 449-1903 |
| Lehman Brothers | Jim Barlage | (212) 526-6093 |
| Warburg Dillon Read | Greg Mischou | (415) 352-5667 |
| PaineWebber | John Lazlo | (415) 576-2980 |
| Bear Stearns | Charles Boucher | (415) 772-3953 |
| Prudential | Hans Mosesman | (650) 321-1631 |
| BancBoston Robertson Stephens | Dan Niles | (415) 693-3241 |
| SG Cowen | Rick Billy | (212) 495-4335 |
| J.P. Morgan | Terry Ragsdale | (212) 648-9047 |
| Soundview | Sudeep Balain | (415) 217-5529 |
| CIBC Oppenheimer | Ken Pearlman | (415) 438-3016 |
|
Literature
> 
