- Revenue $296.7 million
- GAAP EPS $0.69 per fully diluted share
- June quarter revenue outlook: $310-$320 million
EL SEGUNDO, Calif., May 02, 2011 (BUSINESS WIRE) -- International Rectifier Corporation (NYSE:IRF) today announced financial
results for the third quarter (ended March 27, 2011) of its fiscal year
2011. Revenue for the third quarter fiscal year 2011 was $296.7 million,
a 5.3% increase from $281.7 million in the second quarter fiscal year
2011 and a 22.7% increase from $241.9 million in the third quarter
fiscal year 2010.
International Rectifier reported a net income of $49.5 million, or $0.69
per fully diluted share for the third quarter fiscal year 2011, compared
with net income of $43.9 million, or $0.62 per fully diluted share, in
the second quarter fiscal year 2011. The third quarter fiscal year 2011
results included a $6.5 million gross tax benefit and a $3.5 million
reversal of Asset Impairment, Restructuring and Other Charges. Combined,
these two items benefitted third quarter fiscal year 2011 fully diluted
earnings per share by $0.14. For the third quarter fiscal year 2010,
International Rectifier reported a net income of $40.4 million, or $0.56
per fully diluted share. The third quarter fiscal year 2010 results
included a $23.0 million gross tax benefit that increased fully diluted
earnings per share $0.32.
Gross margin was 39.5%, down 3.5% compared with the second quarter
fiscal year 2011 and up from 36.1% in the third quarter fiscal year
2010. The second quarter fiscal year 2011 gross margin was aided by
lower manufacturing costs resulting from higher cost absorption
associated with an increase in inventory in anticipation of future
demand and a higher gross margin product mix.
Operating income was $41.6 million or 14.0% of revenue compared with
$44.6 million or 15.8% of revenue in the second quarter fiscal year 2011
and up from operating income of $17.3 million or 7.2% of revenue in the
third quarter fiscal year 2010.
President and Chief Executive Officer Oleg Khaykin stated: "The March
quarter marked the eighth consecutive quarter of revenue growth for IR.
This achievement is driven by a number of factors, including continued
growth in design wins with tier-one customers and expansion of IR's
power management content in energy-efficient household appliances,
industrial applications and automobiles. We continue to demonstrate a
leadership position in fundamental motion control architectures, a high
growth area critical to energy conservation."
Research and development expenses for the third quarter fiscal year 2011
were $30.7 million, up from $28.5 million in the second quarter fiscal
year 2011.
Selling, general and administrative expenses for the third quarter
fiscal year 2011 were $46.7 million, about flat compared with $46.6
million in the second quarter fiscal year 2011.
Cash, cash equivalents and marketable investments totaled $490.0 million
at the end of the third quarter fiscal year 2011, including restricted
cash of $3.0 million.
Cash provided by operating activities for the third quarter fiscal year
2011 was $3.9 million.
During the third quarter fiscal year 2011, the Company purchased 235,000
shares of its common stock for $7.7 million. The Company had 69,759,341
shares outstanding at the end of the quarter.
Fourth Quarter Outlook
Oleg Khaykin noted: "For the June quarter, we currently expect revenue
to range from $310 million to $320 million and gross margin to be about
38%. We continue to see strength in appliance, industrial and automotive
markets in addition to seasonal strength in the computing and consumer
markets.
"Looking further out, IR has achieved significant new design wins which
will contribute to IR's growth above the industry, both in the short-
and long-term. We have good visibility and strong growth momentum for
the remainder of calendar 2011 and our long-term target operating model
remains unchanged."
Segment Table Information/Customer Segments
The business segment tables included with this release for the Company's
fiscal quarters ended March 27, 2011, December 26, 2010 and March 28,
2010, respectively, reconcile revenue and gross margin for the Company's
customer segments to the consolidated total amounts of such measures for
the Company. What we refer to as our "customer segments" includes our
Power Management Devices, Energy-Saving Products, Automotive Products,
Enterprise Power and HiRel reporting segments, and does not include our
Intellectual Property reporting segment.
Quarterly Report on Form 10-Q
The Company expects to file its Quarterly Report on Form 10-Q for the
2011 fiscal third quarter with the Securities and Exchange Commission on
Monday, May 2, 2011. This financial report will be available for viewing
and download at http://investor.irf.com.
NOTE: A conference call will begin today at 2:00 p.m. Pacific
time. CEO Oleg Khaykin and CFO Ilan Daskal will discuss the company's
March quarter results and June quarter outlook. All participants, both
in the U.S. and international, may join the call by dialing 706-679-3195
by 1:55 p.m. Pacific time. In order to join this conference call,
participants will be required to provide the Conference Passcode:
"International Rectifier". Participants may also listen over the
Internet at http://investor.irf.com.
To listen to the live call, please go to the web site at least 15
minutes early to register, download, and install any necessary audio
software.
A taped replay of this call will be available from approximately 6:00
p.m. Pacific time on Monday, May 2, through Monday, May 9, 2011. To
listen to the replay by phone, call 800-642-1687 or 706-645-9291 for
international callers and enter reservation number 60084665. To listen
to the replay over the Internet, please go to http://investor.irf.com.
The live call and replay will also be available on www.streetevents.com.
About International Rectifier
International Rectifier Corporation (NYSE:IRF) is a world leader in
power management technology. IR's analog, digital, and mixed signal ICs,
and other advanced power management products, enable high performance
computing and save energy in a wide variety of business and consumer
applications. Leading manufacturers of computers, energy efficient
appliances, lighting, automobiles, satellites, aircraft, and defense
systems rely on IR's power management solutions to power their next
generation products. For more information, go to www.irf.com.
Forward-Looking Statements:
This document contains "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. These
statements relate to expectations concerning matters that (a) are not
historical facts, (b) predict or forecast future events or results, or
(c) embody assumptions that may prove to have been inaccurate. These
forward-looking statements involve risks, uncertainties and assumptions.
When we use words such as "believe," "expect," "anticipate," "will" or
similar expressions, we are making forward-looking statements. Although
we believe that the expectations reflected in such forward-looking
statements are reasonable, we cannot give readers any assurance that
such expectations will prove correct. The actual results may differ
materially from those anticipated in the forward-looking statements as a
result of numerous factors, many of which are beyond our control.
Important factors that could cause actual results to differ materially
from our expectations include, but are not limited to, reduced demand
arising from a decline or volatility in general market and economic
conditions or customer forecasts; reduced margins from lower than
expected factory utilization and inventory reduction efforts; volatility
or deterioration of capital markets; the effects of longer lead times
for certain products on meeting demand and any inability by us to
satisfy or to timely satisfy customer demand; additional costs or
adverse financial effects from implementing our strategic growth
initiatives; unexpected costs or delays in implementing our plans to
secure and qualify additional manufacturing capacity for our products,
including the use of third party contract manufacturers and the purchase
and installation of additional manufacturing equipment; the adverse
impact of regulatory, investigative and legal actions; increased
competition in the highly competitive semiconductor business that could
adversely affect the prices of our products or our ability to secure
additional business; the effects of manufacturing, operational and
vendor disruptions; unexpected delays and disruptions in our supply,
manufacturing and delivery efforts due to, among other things, supply
constraints, equipment malfunction or natural disasters (including
without limitation, any effects from events that may occur from natural
and related disasters affecting Japan); delays in launching new
technology products; our ability to maintain current intellectual
property licenses and obtain new intellectual property licenses; costs
arising from pending and threatened litigation or claims; additional
costs or delays in our ability to timely test and implement our new
enterprise resource planning (ERP) system which is currently under
development; and other uncertainties disclosed in the Company's reports
filed from time to time with the Securities and Exchange Commission,
including its most recent reports on Forms 10-K and 10-Q, as filed from
time to time.
| INTERNATIONAL RECTIFIER CORPORATION AND SUBSIDIARIES |
|
| UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS |
|
| (In thousands, except per share data) |
|
|
|
Three Months Ended |
|
|
March 27, |
|
December 26, |
|
March 28, |
|
|
|
2011 |
|
|
|
2010 |
|
|
|
2010 |
|
|
Revenues
|
|
$
|
296,717
|
|
|
$
|
281,744
|
|
|
$
|
241,886
|
|
|
Cost of sales
|
|
|
179,534
|
|
|
|
160,733
|
|
|
|
154,576
|
|
|
Gross profit
|
|
|
117,183
|
|
|
|
121,011
|
|
|
|
87,310
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expense
|
|
|
46,680
|
|
|
|
46,617
|
|
|
|
43,135
|
|
|
Research and development expense
|
|
|
30,733
|
|
|
|
28,544
|
|
|
|
25,649
|
|
|
Amortization of acquisition-related intangible assets
|
|
|
1,695
|
|
|
|
1,242
|
|
|
|
1,093
|
|
|
Asset impairment, restructuring and other charges (recoveries)
|
|
|
(3,489
|
)
|
|
|
(4
|
)
|
|
|
117
|
|
|
Operating income
|
|
|
41,564
|
|
|
|
44,612
|
|
|
|
17,316
|
|
|
Other expense, net
|
|
|
(1,348
|
)
|
|
|
1,708
|
|
|
|
318
|
|
|
Interest income, net
|
|
|
(2,694
|
)
|
|
|
(4,152
|
)
|
|
|
(2,573
|
)
|
|
Income before income taxes
|
|
|
45,606
|
|
|
|
47,056
|
|
|
|
19,571
|
|
|
Provision for (benefit from) income taxes
|
|
|
(3,879
|
)
|
|
|
3,127
|
|
|
|
(20,816
|
)
|
|
Net income
|
|
$
|
49,485
|
|
|
$
|
43,929
|
|
|
$
|
40,387
|
|
|
|
|
|
|
|
|
|
Net income per common share-basic
|
|
$
|
0.70
|
|
|
$
|
0.62
|
|
|
$
|
0.57
|
|
|
|
|
|
|
|
|
|
Net income per common share-diluted
|
|
$
|
0.69
|
|
|
$
|
0.62
|
|
|
$
|
0.56
|
|
|
|
|
|
|
|
|
|
Average common shares outstanding--basic (1)
|
|
|
69,854
|
|
|
|
69,587
|
|
|
|
70,850
|
|
|
Average common shares and potentially dilutive securities
outstanding--diluted (1)
|
|
|
70,601
|
|
|
|
70,235
|
|
|
|
71,176
|
|
|
(1)
|
|
Net income per common share is computed using the two-class
method as required by accounting rules. We do not pay dividends;
however, net income must be allocated to unvested restricted stock
units ("RSUs") on which we could pay dividend equivalents. The
amount of net income allocated to the RSUs is excluded from income
available to common shareholders in the calculation of EPS. These
amounts were $733 thousand, $713 thousand and $266 thousand for
the quarters ending March 27, 2011, December 26, 2010 and March
28, 2010, respectively.
|
|
| INTERNATIONAL RECTIFIER CORPORATION AND SUBSIDIARIES |
|
| UNAUDITED CONSOLIDATED BALANCE SHEETS |
|
| (In thousands) |
|
|
|
March 27, |
|
December 26, |
|
March 28, |
|
|
|
2011 |
|
|
|
2010 |
|
|
|
2010 |
|
| Assets |
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
269,154
|
|
|
$
|
249,301
|
|
|
$
|
189,056
|
|
|
Restricted cash
|
|
|
1,339
|
|
|
|
1,629
|
|
|
|
3,405
|
|
|
Short-term investments
|
|
|
184,446
|
|
|
|
300,939
|
|
|
|
309,363
|
|
|
Trade accounts receivable, net
|
|
|
192,132
|
|
|
|
169,426
|
|
|
|
147,432
|
|
|
Inventories
|
|
|
240,648
|
|
|
|
223,162
|
|
|
|
166,625
|
|
|
Current deferred tax assets
|
|
|
1,401
|
|
|
|
2,008
|
|
|
|
1,218
|
|
|
Prepaid expenses and other receivables
|
|
|
38,098
|
|
|
|
30,412
|
|
|
|
53,173
|
|
|
Total current assets
|
|
|
927,218
|
|
|
|
976,877
|
|
|
|
870,272
|
|
|
Restricted cash
|
|
|
1,632
|
|
|
|
1,776
|
|
|
|
--
|
|
|
Long-term investments
|
|
|
33,465
|
|
|
|
48,820
|
|
|
|
53,602
|
|
|
Property, plant and equipment, net
|
|
|
396,659
|
|
|
|
368,357
|
|
|
|
346,082
|
|
|
Goodwill
|
|
|
121,680
|
|
|
|
74,955
|
|
|
|
74,955
|
|
|
Acquisition-related intangible assets, net
|
|
|
39,757
|
|
|
|
12,485
|
|
|
|
8,540
|
|
|
Long-term deferred tax assets
|
|
|
12,545
|
|
|
|
7,995
|
|
|
|
6,406
|
|
|
Other assets
|
|
|
57,645
|
|
|
|
50,072
|
|
|
|
48,034
|
|
|
Total assets
|
|
$
|
1,590,601
|
|
|
$
|
1,541,337
|
|
|
$
|
1,407,891
|
|
| Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
102,774
|
|
|
$
|
100,236
|
|
|
$
|
83,578
|
|
|
Accrued income taxes
|
|
|
3,237
|
|
|
|
5,164
|
|
|
|
8,489
|
|
|
Accrued salaries, wages and commissions
|
|
|
40,993
|
|
|
|
43,040
|
|
|
|
26,944
|
|
|
Current deferred tax liabilities
|
|
|
268
|
|
|
|
1,687
|
|
|
|
3,056
|
|
|
Other accrued expenses
|
|
|
89,393
|
|
|
|
87,274
|
|
|
|
77,232
|
|
|
Total current liabilities
|
|
|
236,665
|
|
|
|
237,401
|
|
|
|
199,299
|
|
|
Long-term deferred tax liabilities
|
|
|
4,198
|
|
|
|
5,334
|
|
|
|
5,468
|
|
|
Other long-term liabilities
|
|
|
33,641
|
|
|
|
34,061
|
|
|
|
37,286
|
|
|
Total liabilities
|
|
|
274,504
|
|
|
|
276,796
|
|
|
|
242,053
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
|
|
Common shares
|
|
|
74,387
|
|
|
|
74,184
|
|
|
|
73,429
|
|
|
Capital contributed in excess of par value of shares
|
|
|
1,016,706
|
|
|
|
1,011,345
|
|
|
|
993,213
|
|
|
Treasury stock, at cost
|
|
|
(81,245
|
)
|
|
|
(73,589
|
)
|
|
|
(40,061
|
)
|
|
Retained earnings
|
|
|
306,101
|
|
|
|
256,616
|
|
|
|
150,167
|
|
|
Accumulated other comprehensive income (loss)
|
|
|
148
|
|
|
|
(4,015
|
)
|
|
|
(10,910
|
)
|
|
Total stockholders' equity
|
|
|
1,316,097
|
|
|
|
1,264,541
|
|
|
|
1,165,838
|
|
|
Total liabilities and stockholders' equity
|
|
$
|
1,590,601
|
|
|
$
|
1,541,337
|
|
|
$
|
1,407,891
|
|
|
| INTERNATIONAL RECTIFIER CORPORATION AND SUBSIDIARIES |
|
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|
| (In thousands) |
|
|
|
March 27, |
|
December 26, |
|
March 28, |
|
|
|
2011 |
|
|
|
2010 |
|
|
|
2010 |
|
| Cash flows from operating activities: |
|
|
|
|
|
|
|
Net income
|
|
$
|
49,485
|
|
|
$
|
43,929
|
|
|
$
|
40,387
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
18,981
|
|
|
|
19,638
|
|
|
|
18,107
|
|
|
Amortization of acquisition-related intangible assets
|
|
|
1,695
|
|
|
|
1,242
|
|
|
|
1,093
|
|
|
Stock compensation expense
|
|
|
3,353
|
|
|
|
3,660
|
|
|
|
3,096
|
|
|
(Gain) loss on disposal of fixed assets
|
|
|
--
|
|
|
|
(48
|
)
|
|
|
232
|
|
|
Provision for bad debt
|
|
|
(946
|
)
|
|
|
(449
|
)
|
|
|
(561
|
)
|
|
Provision for inventory write-downs
|
|
|
2,376
|
|
|
|
2,635
|
|
|
|
1,510
|
|
|
Deferred income taxes
|
|
|
(6,640
|
)
|
|
|
(90
|
)
|
|
|
807
|
|
|
Other-than-temporary impairment of investments
|
|
|
413
|
|
|
|
--
|
|
|
|
55
|
|
|
(Gain) loss on derivatives
|
|
|
5,465
|
|
|
|
(1,684
|
)
|
|
|
956
|
|
|
Gain on sale of investments
|
|
|
(2,267
|
)
|
|
|
(3,483
|
)
|
|
|
(1,519
|
)
|
|
Tax benefit from stock options
|
|
|
501
|
|
|
|
536
|
|
|
|
--
|
|
|
Excess tax benefit from stock options exercised
|
|
|
(959
|
)
|
|
|
(1,694
|
)
|
|
|
(47
|
)
|
|
Net settlement of restricted stock units for tax withholdings
|
|
|
(821
|
)
|
|
|
(1,667
|
)
|
|
|
(491
|
)
|
|
Changes in operating assets and liabilities, net
|
|
|
(61,133
|
)
|
|
|
(10,664
|
)
|
|
|
(36,086
|
)
|
|
Other
|
|
|
(5,630
|
)
|
|
|
3,531
|
|
|
|
1,516
|
|
| Net cash provided by operating activities |
|
|
3,873
|
|
|
|
55,392
|
|
|
|
29,055
|
|
| Cash flows from investing activities: |
|
|
|
|
|
|
|
Additions to property, plant and equipment
|
|
|
(38,032
|
)
|
|
|
(32,945
|
)
|
|
|
(18,254
|
)
|
|
Proceeds from sale of property, plant and equipment
|
|
|
--
|
|
|
|
800
|
|
|
|
--
|
|
|
Withdrawal of excess funds from deferred compensation plan
|
|
|
--
|
|
|
|
--
|
|
|
|
2,433
|
|
|
Business acquisitions
|
|
|
(75,940
|
)
|
|
|
--
|
|
|
|
--
|
|
|
Released from restricted cash
|
|
|
428
|
|
|
|
--
|
|
|
|
--
|
|
|
Sale of investments
|
|
|
98,823
|
|
|
|
18,697
|
|
|
|
35,950
|
|
|
Maturities of investments
|
|
|
83,494
|
|
|
|
64,400
|
|
|
|
20,260
|
|
|
Purchase of investments
|
|
|
(50,376
|
)
|
|
|
(89,524
|
)
|
|
|
(81,963
|
)
|
|
Redemption of equity investments
|
|
|
--
|
|
|
|
--
|
|
|
|
2,050
|
|
|
Purchase of cost-based investments
|
|
|
(350
|
)
|
|
|
--
|
|
|
|
--
|
|
| Net cash provided by (used in) investing activities |
|
|
18,047
|
|
|
|
(38,572
|
)
|
|
|
(39,524
|
)
|
| Cash flows from financing activities: |
|
|
|
|
|
|
|
Proceeds from exercise of stock options
|
|
|
2,530
|
|
|
|
6,859
|
|
|
|
2,882
|
|
|
Excess tax benefit from stock options exercised
|
|
|
959
|
|
|
|
1,694
|
|
|
|
47
|
|
|
Purchase of treasury stock
|
|
|
(7,656
|
)
|
|
|
(4,887
|
)
|
|
|
(11,421
|
)
|
| Net cash provided by (used in) financing activities |
|
|
(4,167
|
)
|
|
|
3,666
|
|
|
|
(8,492
|
)
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
2,100
|
|
|
|
(866
|
)
|
|
|
(1,389
|
)
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
19,853
|
|
|
|
19,620
|
|
|
|
(20,350
|
)
|
| Cash and cash equivalents, beginning of period |
|
|
249,301
|
|
|
|
229,681
|
|
|
|
209,406
|
|
| Cash and cash equivalents, end of period |
|
$
|
269,154
|
|
|
$
|
249,301
|
|
|
$
|
189,056
|
|
|
|
For the three months ended March 27, 2011 and December 26, 2010,
revenue and gross margin by reportable segments were as follows
(in thousands, except percentages):
|
|
|
|
March 27, 2011 |
|
December 26, 2010 |
|
|
|
|
Percentage |
|
Gross |
|
|
|
Percentage |
|
Gross |
| Business Segment |
|
Revenues |
|
of Total |
|
Margin |
|
Revenues |
|
of Total |
|
Margin |
|
Power Management Devices
|
|
$
|
104,133
|
|
35.1
|
%
|
|
29.7
|
%
|
|
$
|
112,550
|
|
39.9
|
%
|
|
37.1
|
%
|
|
Energy-Saving Products
|
|
|
74,337
|
|
25.1
|
|
|
44.6
|
|
|
|
63,056
|
|
22.4
|
|
|
47.3
|
|
|
Automotive Products
|
|
|
30,859
|
|
10.4
|
|
|
28.7
|
|
|
|
25,514
|
|
9.1
|
|
|
32.5
|
|
|
Enterprise Power
|
|
|
33,098
|
|
11.2
|
|
|
41.7
|
|
|
|
31,600
|
|
11.2
|
|
|
50.5
|
|
|
HiRel
|
|
|
52,497
|
|
17.7
|
|
|
54.6
|
|
|
|
47,066
|
|
16.7
|
|
|
49.3
|
|
|
Customer segments total
|
|
|
294,924
|
|
99.4
|
|
|
39.1
|
|
|
|
279,786
|
|
99.3
|
|
|
42.6
|
|
|
Intellectual Property
|
|
|
1,793
|
|
0.6
|
|
|
100.0
|
|
|
|
1,958
|
|
0.7
|
|
|
100.0
|
|
|
Consolidated total
|
|
$
|
296,717
|
|
100.0
|
%
|
|
39.5
|
%
|
|
$
|
281,744
|
|
100.0
|
%
|
|
43.0
|
%
|
|
|
For the three months ended March 28, 2010, revenue and gross
margin by reportable segments were as follows (in thousands,
except percentages):
|
|
|
|
March 28, 2010 |
|
|
|
|
Percentage |
|
Gross |
| Business Segment |
|
Revenues |
|
of Total |
|
Margin |
|
Power Management Devices
|
|
$
|
95,021
|
|
39.3
|
%
|
|
21.1
|
%
|
|
Energy-Saving Products
|
|
|
51,992
|
|
21.5
|
|
|
44.7
|
|
|
Automotive Products
|
|
|
19,950
|
|
8.2
|
|
|
28.3
|
|
|
Enterprise Power
|
|
|
32,586
|
|
13.5
|
|
|
41.8
|
|
|
HiRel
|
|
|
40,163
|
|
16.6
|
|
|
56.2
|
|
|
Customer segments total
|
|
|
239,712
|
|
99.1
|
|
|
35.5
|
|
|
Intellectual Property
|
|
|
2,174
|
|
0.9
|
|
|
100.0
|
|
|
Consolidated total
|
|
$
|
241,886
|
|
100.0
|
%
|
|
36.1
|
%
|
SOURCE: International Rectifier Corporation
International Rectifier Corporation
Investors:
Chris Toth, 310-252-7731
or
Media:
Sian Cummings, 310-252-7148
|
