Revenue increases to a record $814 million, non-GAAP diluted
earnings per share increases to $0.69
Company Website:
http://www.analog.com
NORWOOD, Mass. -- (Business Wire)
Analog
Devices, Inc. (NASDAQ: ADI),
a global leader in high-performance semiconductors for signal processing
applications, today announced financial results for its fourth quarter
and fiscal year 2014, which ended November 1, 2014.
“During the fourth quarter order rates were stable and ADI executed very
well, resulting in record revenue and earnings growth that was near the
high end of our guidance,” said Vincent Roche, President and CEO. “Our
cash flow and balance sheet remained strong and we returned $304 million
to shareholders through dividends and increased share repurchases.”
“We are planning for revenue in the first quarter to be in the range of
$745 million to $775 million, which at the mid-point represents an
increase of 21% year-over-year,” said Mr. Roche. “We are carefully
managing factory utilization rates and expenses, and positioning ADI for
better operating leverage, which is likely to come as early as our
second quarter.”
ADI also announced that its Board of Directors has declared a cash
dividend of $0.37 per outstanding share of common stock. The dividend
will be paid on December 16, 2014 to all shareholders of record at the
close of business on December 5, 2014.
Results for the Fourth Quarter of Fiscal Year
2014
Results for the fourth quarter and fiscal year 2014 include
contributions from Hittite Microwave.The acquisition was
announced on June 9, 2014 and closed on July 22, 2014.
-
Revenue totaled $814 million, up 12% sequentially
-
GAAP gross margin of 59.7% of revenue; Non-GAAP gross margin of 66.4%
of revenue
-
GAAP operating margin of 18.4% of revenue; Non-GAAP operating margin
of 33.2% of revenue
-
GAAP diluted EPS of $0.34; Non-GAAP diluted EPS of $0.69
Results for Fiscal Year 2014
-
Revenue totaled $2.9 billion, up 9% year-over-year
-
GAAP gross margin of 63.9% of revenue; Non-GAAP gross margin of 66% of
revenue
-
GAAP operating margin of 26.3% of revenue; Non-GAAP operating margin
of 31.8% of revenue
-
GAAP diluted EPS of $1.98 per share; Non-GAAP diluted EPS of $2.39 per
share
-
Free cash flow of $694 million, or 24% of revenue
-
Share repurchases and dividend payments to shareholders totaled $811
million
Please refer to the schedules provided for a summary of revenue and
earnings, selected balance sheet information, and the cash flow
statement for the fourth quarter and fiscal year 2014, as well as the
immediately prior and year-ago quarters. Additional information on
revenue by end market is provided on Schedule D. A more complete table
covering prior periods is available at investor.analog.com.
Outlook for the First Quarter of Fiscal Year
2015
The following statements are based on current expectations, and as
indicated, are presented on a GAAP and non-GAAP basis. These statements
are forward-looking and actual results may differ materially, as a
result of, among other things, the important factors discussed at the
end of this release. These statements supersede all prior statements
regarding our business outlook set forth in prior ADI news releases, and
ADI disclaims any obligation to update these forward-looking statements.
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| GAAP |
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| Non-GAAP Adjustments |
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| Non-GAAP |
Revenue |
|
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|
|
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| $745 to $775 million |
|
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-
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| $745 to $775 million |
Gross Margin
|
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approx. 64.7%
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$2.6 million (1) |
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approx. 65.0%
|
Operating Expenses
|
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approx. $288 million
|
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$25 million (2) |
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approx. $263 million
|
Interest & Other Expense
|
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$5.0 million
|
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-
|
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$5.0 million
|
Tax Rate
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approx. 16.5%
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$4 million (3) |
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approx. 14.5%
|
Earnings per Share |
|
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| $0.50 to $0.56 |
|
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$0.08 (4) |
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| $0.58 to $0.64 |
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| |
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| |
-
Reflects estimated adjustments for amortization of intangible assets
of $1 million and step-up charges to record Hittite inventory and
fixed assets of $1.6 million at fair value as part of the purchase
accounting for the Hittite acquisition.
-
Reflects estimated adjustments for amortization of intangible assets.
-
Represents the tax effect for the items noted above.
-
Represents the expenses and associated tax impact of the amortization
of purchased intangibles and step-up charges on a per share basis.
Conference Call Scheduled for 5:00 pm ET
ADI will host a conference call to discuss the fourth quarter and full
year 2014 results and short-term outlook today, beginning at 5:00 pm ET.
Investors may join via webcast, accessible at investor.analog.com,
or by telephone (call 706-634-7193 ten minutes before the call begins
and provide the password "ADI").
A replay will be available two hours after the completion of the call.
The replay may be accessed for up to two weeks by dialing 855-859-2056
(replay only) and providing the conference ID: 17076906, or by visiting investor.analog.com.
Non-GAAP Financial Information
This release includes non-GAAP financial measures that are not in
accordance with, nor an alternative to, generally accepted accounting
principles and may be different from non-GAAP measures used by other
companies. In addition, these non-GAAP measures are not based on any
comprehensive set of accounting rules or principles.
Schedule E of this press release provides the reconciliation of the
Company’s historical non-GAAP measures to its GAAP measures.
Management uses non-GAAP revenue, non-GAAP gross margin, non-GAAP
operating expenses, non-GAAP operating income, non-GAAP operating
margins, non-GAAP other expense, and non-GAAP diluted earnings per share
to evaluate the Company’s operating performance from continuing
operations against past periods and to budget and allocate resources in
future periods. These non-GAAP measures also assist management in
understanding and evaluating the Company’s operating results and trends
in the Company’s business.
The following item is excluded from our Non-GAAP revenue:
Hittite Operations: The results of operations of Hittite from
July 22, 2014 through August 2, 2014 have been excluded from our
non-GAAP measures in the third quarter of 2014 because they are not
reflective of ongoing operating results.
The following items are excluded from our Non-GAAP gross margin,
non-GAAP operating expenses, non-GAAP operating income, non-GAAP
operating margin, and non-GAAP diluted earnings per share:
Hittite Operations: The results of operations of Hittite from
July 22, 2014 through August 2, 2014 have been excluded from our
non-GAAP measures in the third quarter of 2014 because they are not
reflective of ongoing operating results.
Acquisition-Related Expenses: Expenses incurred as a result of
the Hittite acquisition in the third and fourth quarter of fiscal 2014
primarily include: severance payments; expense associated with the fair
value adjustments to inventory, property, plant and equipment, and
distributor deferred costs; and amortization of acquisition related
intangibles, which include acquired intangibles such as purchased
technology and customer relationships. We excluded these costs from our
non-GAAP measures because they relate to a specific transaction and are
not reflective of our ongoing financial performance.
Stock-Based Compensation Expense: In the fourth quarter of 2014,
the Company canceled certain stock awards in conjunction with the
restructuring charge which resulted in the recognition of income for
stock-based compensation expense recorded in prior periods for these
awards. This stock-based compensation income and the related tax effect
have no direct correlation to the operation of our business in the
future.
The following items are excluded from our non-GAAP operating
expenses, non-GAAP operating income, non-GAAP operating margin, and
non-GAAP diluted earnings per share:
The exclusion of these items allows management to evaluate the Company’s
core business and trends across different reporting periods on a
consistent basis. Management presents these Non-GAAP items to enable
investors and analysts to evaluate our core business.
Acquisition-Related Transaction Costs: Costs incurred as a result
of the Hittite acquisition in the third and fourth quarter of fiscal
2014 include legal, accounting and other professional fees directly
related to the Hittite acquisition. We excluded these costs from our
non-GAAP measures because they relate to a specific transaction and are
not reflective of our ongoing financial performance.
Restructuring-Related Expenses: These expenses are incurred in
connection with facility closures, consolidation of manufacturing
facilities, severance, and other cost reduction efforts. Apart from
ongoing expense savings as a result of such items, these expenses and
the related tax effects have no direct correlation to the operation of
our business in the future.
The following items are excluded from our non-GAAP other expense and
non-GAAP diluted earnings per share:
Acquisition-Related Debt Costs: The Company incurred debt
financing costs during the third and fourth quarters of fiscal 2014 on
its 90-day term loan facility used to finance the Hittite acquisition.
We excluded these costs from our non-GAAP measures because they are not
reflective of our ongoing financial performance.
Gain on Sale of Product Line: In the fourth quarter of fiscal
2013, the Company completed the sale of its microphone product line and
recorded a gain of $85.4 million in non-operating income. We excluded
the gain and related tax effect from our non-GAAP measures as these
items have no direct correlation to the operation of our business in the
future.
Debt Extinguishment Costs: In the third quarter of fiscal 2013,
the Company redeemed its outstanding 5.0% senior unsecured notes due
July 1, 2014. The Company recognized a net loss on debt extinguishment
of approximately $10.2 million, which was comprised of a make-whole
premium, the recognition of unamortized proceeds received on an interest
rate swap associated with the debt and the write off of unamortized debt
issuance and discount costs. We excluded these costs from our non-GAAP
measures because they are one time in nature and have no direct
correlation to the operation of our business in the future.
The following item is excluded from our non-GAAP diluted earnings per
share:
Tax-Related Items: In the first quarter of fiscal 2013, the
Company recorded a $6.3 million tax benefit related to the reinstatement
of the R&D tax credit in January 2013, retroactive to January 1, 2012.
In the second quarter of fiscal 2013, the Company recorded a $6.6
million tax benefit as a result of the reversal of prior period tax
liabilities. In the third quarter of fiscal 2013, the Company recorded a
$1.7 million tax benefit related to the release of a tax reserve for an
expired tax year. In the fourth quarter of fiscal 2013, as a result of a
ruling by the U.S. Tax Court in a matter not involving the Company, the
Company recorded a potential liability for $36.5 million plus $4.6
million of interest related to its petition with the U.S. Tax Court
regarding the beneficial tax treatment of dividends paid from foreign
owned companies under The American Jobs Creation Act. The Company also
recorded a $2.2 million tax benefit as a result of the reversal of prior
period tax liabilities. Also in the fourth quarter of 2013, the Company
completed the sale of its microphone product line, resulting in $26.7
million of income tax expense. In the fourth quarter of 2014, the
Company recorded $5.5 million of tax adjustments related to the Hittite
acquisition. We excluded these tax-related items from our non-GAAP
measures because they are not associated with the tax expense on our
current operating results.
Management believes that the presentation of non-GAAP revenue, non-GAAP
gross margin, non-GAAP operating expenses, non-GAAP operating income,
non-GAAP operating margins, non-GAAP other expenses and non-GAAP diluted
EPS is useful to investors because it provides investors with the
operating results that management uses to manage the Company.
Analog Devices believes that non-GAAP revenue, non-GAAP gross margin,
non-GAAP operating expenses, non-GAAP operating income, non-GAAP
operating margins, non-GAAP other expenses and non-GAAP diluted EPS have
material limitations in that they do not reflect all of the amounts
associated with our results of operations as determined in accordance
with GAAP and that these measures should only be used to evaluate our
results of operations in conjunction with the corresponding GAAP
measures. In addition, our non-GAAP measures may not be comparable to
the non-GAAP measures reported by other companies. The Company’s use of
non-GAAP measures, and the underlying methodology when excluding certain
items, is not necessarily an indication of the results of operations
that may be expected in the future, or that the Company will not, in
fact, record such items in future periods.
Investors should consider our non-GAAP financial measures in conjunction
with the corresponding GAAP measures.
About Analog Devices
Innovation, performance, and excellence are the cultural pillars on
which Analog Devices has built one of the longest standing, highest
growth companies within the technology sector. Acknowledged
industry-wide as the world leader in data conversion and signal
conditioning technology, Analog Devices serves over 100,000 customers,
representing virtually all types of electronic equipment. Analog Devices
is headquartered in Norwood, Massachusetts, with design and
manufacturing facilities throughout the world. Analog Devices' common
stock is included in the S&P 500 Index.
This release may be deemed to contain forward-looking statements
intended to qualify for the safe harbor from liability established by
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include, among other things, our statements
regarding expected revenue, earnings per share, operating expenses,
gross margin, tax rate, and other financial results, including
inventories, other current assets and goodwill, expected operating
leverage, production and inventory levels, objectives, plans and goals,
expected market trends, and expected customer demand and order rates for
our products,that are based on our current expectations,
beliefs, assumptions, estimates, forecasts, and projections about our
business and the industry and markets in which Analog Devices operates.
The statements contained in this release are not guarantees of future
performance, are inherently uncertain, involve certain risks,
uncertainties, and assumptions that are difficult to predict, and do not
give effect to the potential impact of any mergers, acquisitions,
divestitures, or business combinations that may be announced or closed
after the date hereof. Therefore, actual outcomes and results may differ
materially from what is expressed in such forward-looking statements,
and such statements should not be relied upon as representing Analog
Devices’ expectations or beliefs as of any date subsequent to the date
of this press release. We do not undertake any obligation to update
forward-looking statements made by us. Important factors that may affect
future operating results include: any faltering in global economic
conditions or the stability of credit and financial markets, erosion of
consumer confidence and declines in customer spending, unavailability of
raw materials, services, supplies or manufacturing capacity, changes in
geographic, product or customer mix, our ability to successfully
integrate acquired businesses and technologies, adverse results in
litigation matters, the finalization of our purchase price accounting
relating to our acquisition of Hittite Microwave Corporationand
other risk factors described in our most recent filings with the
Securities and Exchange Commission.Our results of operations for
the periods presented in this release are not necessarily indicative of
our operating results for any future periods. Any projections in this
release are based on limited information currently available to Analog
Devices, which is subject to change. Although any such projections and
the factors influencing them will likely change, we will not necessarily
update the information, as we will only provide guidance at certain
points during the year. Such information speaks only as of the original
issuance date of this release.
Analog Devices and the Analog Devices logo are registered trademarks or
trademarks of Analog Devices, Inc. All other trademarks mentioned in
this document are the property of their respective owners.
|
Analog Devices, Fourth Quarter, Fiscal 2014 |
|
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|
| |
Schedule A |
Revenue and Earnings Summary (Unaudited) |
(In thousands, except per-share amounts) |
| | | | | | | | | | | | | | |
|
| | |
|
|
|
|
|
|
| | |
|
|
|
|
| | | Three Months Ended | | | Twelve Months Ended |
| | | 4Q 14 | | | 3Q 14 | | | 4Q 13 | | | FY 14 | | | FY 13 |
|
|
| Nov. 1, 2014 |
|
| Aug. 2, 2014 |
|
| Nov. 2, 2013 |
|
| Nov. 1, 2014 |
|
| Nov. 2, 2013 |
Revenue
| | |
$
|
814,247
| | | |
$
|
727,752
| | | |
$
|
678,133
| | | |
$
|
2,864,773
| | | |
$
|
2,633,689
| |
Year-to-year change
| | | |
20
|
%
| | | |
8
|
%
| | | |
-2
|
%
| | | |
9
|
%
| | | |
-2
|
%
|
Quarter-to-quarter change
| | | |
12
|
%
| | | |
5
|
%
| | | |
1
|
%
| | | | | | |
Cost of sales (1)
|
|
|
|
328,210
|
|
|
|
|
251,462
|
|
|
|
|
233,263
|
|
|
|
|
1,034,585
|
|
|
|
|
941,278
|
|
Gross margin
| | | |
486,037
| | | | |
476,290
| | | | |
444,870
| | | | |
1,830,188
| | | | |
1,692,411
| |
Gross margin percentage
| | | |
59.7
|
%
| | | |
65.4
|
%
| | | |
65.6
|
%
| | | |
63.9
|
%
| | | |
64.3
|
%
|
Year-to-year change (basis points)
| | | |
-590
| | | | |
90
| | | | |
180
| | | | |
-40
| | | | |
-20
| |
Quarter-to-quarter change (basis points)
|
|
|
|
-570
|
|
|
|
|
-70
|
|
|
|
|
110
|
|
|
|
|
|
|
|
Operating expenses:
| | | | | | | | | | | | | | | |
R&D (1)
| | | |
154,797
| | | | |
140,095
| | | | |
130,979
| | | | |
559,686
| | | | |
513,035
| |
Selling, marketing and G&A (1)
| | | |
121,424
| | | | |
132,989
| | | | |
98,197
| | | | |
454,676
| | | | |
396,233
| |
Amortization of intangibles
| | | |
25,250
| | | | |
660
| | | | |
55
| | | | |
26,020
| | | | |
220
| |
Special charges
|
|
|
|
34,637
|
|
|
|
|
-
|
|
|
|
|
15,777
|
|
|
|
|
37,322
|
|
|
|
|
29,848
|
|
Total operating expenses
| | | |
336,108
| | | | |
273,744
| | | | |
245,008
| | | | |
1,077,704
| | | | |
939,336
| |
Total operating expenses percentage
| | | |
41.3
|
%
| | | |
37.6
|
%
| | | |
36.1
|
%
| | | |
37.6
|
%
| | | |
35.7
|
%
|
Year-to-year change (basis points)
| | | |
520
| | | | |
400
| | | | |
330
| | | | |
190
| | | | |
180
| |
Quarter-to-quarter change (basis points)
|
|
|
|
370
|
|
|
|
|
330
|
|
|
|
|
250
|
|
|
|
|
|
|
|
Operating income
| | | |
149,929
| | | | |
202,546
| | | | |
199,862
| | | | |
752,484
| | | | |
753,075
| |
Operating income percentage
| | | |
18.4
|
%
| | | |
27.8
|
%
| | | |
29.5
|
%
| | | |
26.3
|
%
| | | |
28.6
|
%
|
Year-to-year change (basis points)
| | | |
-1,110
| | | | |
-310
| | | | |
-150
| | | | |
-230
| | | | |
-190
| |
Quarter-to-quarter change (basis points)
|
|
|
|
-940
|
|
|
|
|
-390
|
|
|
|
|
-140
|
|
|
|
|
|
|
|
Other expense
|
|
|
|
11,231
|
|
|
|
|
5,158
|
|
|
|
|
(82,650
|
)
|
|
|
|
23,139
|
|
|
|
|
(62,248
|
)
|
Income before income tax
| | | |
138,698
| | | | |
197,388
| | | | |
282,512
| | | | |
729,345
| | | | |
815,323
| |
Provision for income taxes
| | | |
30,003
| | | | |
16,782
| | | | |
80,958
| | | | |
100,025
| | | | |
141,836
| |
Tax rate percentage
|
|
|
|
21.6
|
%
|
|
|
|
8.5
|
%
|
|
|
|
28.7
|
%
|
|
|
|
13.7
|
%
|
|
|
|
17.4
|
%
|
Net income
|
|
|
$
|
108,695
|
|
|
|
$
|
180,606
|
|
|
|
$
|
201,554
|
|
|
|
$
|
629,320
|
|
|
|
$
|
673,487
|
|
| | | | | | | | | | | | | | |
|
Shares used for EPS - basic
| | | |
312,815
| | | | |
314,190
| | | | |
311,009
| | | | |
313,195
| | | | |
307,763
| |
Shares used for EPS - diluted
| | | |
316,868
| | | | |
318,876
| | | | |
317,216
| | | | |
318,027
| | | | |
314,041
| |
| | | | | | | | | | | | | | |
|
Earnings per share - basic
| | |
$
|
0.35
| | | |
$
|
0.57
| | | |
$
|
0.65
| | | |
$
|
2.01
| | | |
$
|
2.19
| |
Earnings per share - diluted
| | |
$
|
0.34
| | | |
$
|
0.57
| | | |
$
|
0.64
| | | |
$
|
1.98
| | | |
$
|
2.14
| |
| | | | | | | | | | | | | | |
|
Dividends paid per share
|
|
|
$
|
0.37
|
|
|
|
$
|
0.37
|
|
|
|
$
|
0.34
|
|
|
|
$
|
1.45
|
|
|
|
$
|
1.32
|
|
| | | | | | | | | | | | | | |
|
(1) Includes stock-based compensation expense as follows:
| | | | | | | | | | | | | | | |
Cost of sales
| | |
$
|
2,371
| | | |
$
|
1,724
| | | |
$
|
1,737
| | | |
$
|
7,069
| | | |
$
|
6,593
| |
R&D
| | |
$
|
6,155
| | | |
$
|
5,415
| | | |
$
|
5,721
| | | |
$
|
20,707
| | | |
$
|
21,901
| |
Selling, marketing and G&A
| | |
$
|
6,867
| | | |
$
|
6,331
| | | |
$
|
5,664
| | | |
$
|
23,036
| | | |
$
|
28,392
| |
| | | | | | | | | | | | | | | | | | | | | | | | |
|
|
|
| |
|
| |
|
| |
Analog Devices, Fourth Quarter, Fiscal 2014 |
| | | | | | | | |
|
Schedule B |
Selected Balance Sheet Information (Unaudited) |
(In thousands) |
| | | | | | | | |
|
| | | 4Q 14 | | | 3Q 14 | | | 4Q 13 |
|
|
| Nov. 1, 2014 |
|
| Aug. 2, 2014 |
|
| Nov. 2, 2013 |
Cash & short-term investments
| | |
$
|
2,866,468
| | |
$
|
4,932,259
| | |
$
|
4,682,912
|
Accounts receivable, net
| | | |
396,605
| | | |
394,762
| | | |
325,144
|
Inventories (1) (2)
| | | |
367,927
| | | |
415,098
| | | |
283,337
|
Other current assets (3)
|
|
|
|
196,402
|
|
|
|
181,765
|
|
|
|
181,032
|
Total current assets
| | | |
3,827,402
| | | |
5,923,884
| | | |
5,472,425
|
PP&E, net
| | | |
622,422
| | | |
609,937
| | | |
508,171
|
Investments
| | | |
34,507
| | | |
32,022
| | | |
21,180
|
Goodwill (3)
| | | |
1,642,438
| | | |
1,631,890
| | | |
284,112
|
Intangible assets, net
| | | |
671,402
| | | |
695,832
| | | |
28,552
|
Other (3)
|
|
|
|
78,586
|
|
|
|
79,900
|
|
|
|
67,310
|
Total assets
|
|
|
$
|
6,876,757
|
|
|
$
|
8,973,465
|
|
|
$
|
6,381,750
|
| | | | | | | | |
|
Deferred income on shipments to distributors, net
| | |
$
|
278,435
| | |
$
|
285,832
| | |
$
|
247,428
|
Current debt
| | | |
-
| | | |
1,995,398
| | | |
-
|
Other current liabilities (3)
| | | |
433,543
| | | |
341,296
| | | |
323,084
|
Long-term debt, non-current
| | | |
872,789
| | | |
872,652
| | | |
872,241
|
Non-current liabilities (3)
| | | |
534,093
| | | |
471,090
| | | |
199,421
|
Shareholders' equity
|
|
|
|
4,757,897
|
|
|
|
5,007,197
|
|
|
|
4,739,576
|
Total liabilities & equity
|
|
|
$
|
6,876,757
|
|
|
$
|
8,973,465
|
|
|
$
|
6,381,750
|
| | | | | | | | |
|
(1) Includes $3,291, $2,094, and $2,273 related to stock-based
compensation in 4Q14, 3Q14, and 4Q13, respectively.
|
(2) Includes $53,638 and $103,795 of acquired inventory in 4Q14 and
3Q14, respectively.
|
(3) Deferred tax and goodwill balances are preliminary pending
finalization of the Hittite Acquisition purchase accounting.
|
| | | | | | | | | |
|
Analog Devices, Fourth Quarter, Fiscal 2014 |
|
|
| |
|
| |
|
| |
|
| |
|
| |
Schedule C |
Cash Flow Statement (Unaudited) |
(In thousands) |
| | | | | | | | | | | | | | |
|
| | |
|
|
|
|
|
|
| | |
|
|
|
|
| | | Three Months Ended | | | Twelve Months Ended |
| | | 4Q 14 | | | 3Q 14 | | | 4Q 13 | | | FY 14 | | | FY 13 |
| | | Nov. 1, 2014 |
|
| Aug. 2, 2014 |
|
| Nov. 2, 2013 | | | Nov. 1, 2014 |
|
| Nov. 2, 2013 |
Cash flows from operating activities:
| | | | | | | | | | | | | | | |
Net Income
| | |
$
|
108,695
| | | |
$
|
180,606
| | | |
$
|
201,554
| | | |
$
|
629,320
| | | |
$
|
673,487
| |
Adjustments to reconcile net income to net cash provided by
operations:
| | | | | | | | | | | | | | | |
Depreciation
| | | |
30,917
| | | | |
28,353
| | | | |
27,515
| | | | |
114,064
| | | | |
110,196
| |
Amortization of intangibles
| | | |
26,186
| | | | |
1,610
| | | | |
55
| | | | |
27,906
| | | | |
220
| |
Stock-based compensation expense
| | | |
15,393
| | | | |
13,470
| | | | |
13,122
| | | | |
50,812
| | | | |
56,886
| |
Loss on extinguishment of debt
| | | |
-
| | | | |
-
| | | | |
-
| | | | |
-
| | | | |
10,205
| |
Gain on sale of product line
| | | |
-
| | | | |
-
| | | | |
(85,444
|
)
| | | |
-
| | | | |
(85,444
|
)
|
Other non-cash activity
| | | |
600
| | | | |
1,006
| | | | |
887
| | | | |
4,423
| | | | |
(185
|
)
|
Excess tax benefit - stock options
| | | |
(882
|
)
| | | |
(9,322
|
)
| | | |
(1,098
|
)
| | | |
(22,231
|
)
| | | |
(16,171
|
)
|
Deferred income taxes
| | | |
(56,812
|
)
| | | |
(6,380
|
)
| | | |
(6,558
|
)
| | | |
(65,117
|
)
| | | |
(17,699
|
)
|
Changes in operating assets and liabilities
|
|
|
|
138,166
|
|
|
|
|
4,099
|
|
|
|
|
132,132
|
| | |
|
132,425
|
|
|
|
|
180,850
|
|
Total adjustments
|
|
|
|
153,568
|
|
|
|
|
32,836
|
|
|
|
|
80,611
|
| | |
|
242,282
|
|
|
|
|
238,858
|
|
Net cash provided by operating activities
|
|
|
|
262,263
|
|
|
|
|
213,442
|
|
|
|
|
282,165
|
| | |
|
871,602
|
|
|
|
|
912,345
|
|
Percent of total revenue
|
|
|
|
32.2
|
%
|
|
|
|
29.3
|
%
|
|
|
|
41.6
|
%
| | |
|
30.4
|
%
|
|
|
|
34.6
|
%
|
| | | | | | | | | | | | | | |
|
Cash flows from investing activities:
| | | | | | | | | | | | | | | |
Purchases of short-term available-for-sale investments
| | | |
(1,946,144
|
)
| | | |
(1,028,781
|
)
| | | |
(2,559,600
|
)
| | | |
(7,485,162
|
)
| | | |
(8,540,335
|
)
|
Maturities of short-term available-for-sale investments
| | | |
1,507,940
| | | | |
1,815,862
| | | | |
2,199,444
| | | | |
7,318,877
| | | | |
6,970,885
| |
Sales of short-term available-for-sale investments
| | | |
487,259
| | | | |
1,298,044
| | | | |
59,903
| | | | |
2,187,389
| | | | |
650,730
| |
Additions to property, plant and equipment
| | | |
(43,417
|
)
| | | |
(42,315
|
)
| | | |
(48,558
|
)
| | | |
(177,913
|
)
| | | |
(123,074
|
)
|
Payments for acquisitions, net of cash acquired
| | | |
(2,183
|
)
| | | |
(1,943,704
|
)
| | | |
-
| | | | |
(1,945,887
|
)
| | | |
(2,475
|
)
|
Proceeds from sale of product line
| | | |
-
| | | | |
-
| | | | |
100,000
| | | | |
-
| | | | |
100,000
| |
Change in other assets
|
|
|
|
(2,633
|
)
|
|
|
|
(340
|
)
|
|
|
|
(1,591
|
)
| | |
|
(12,055
|
)
|
|
|
|
(5,657
|
)
|
Net cash provided by (used for) investing activities
|
|
|
|
822
|
|
|
|
|
98,766
|
|
|
|
|
(250,402
|
)
| | |
|
(114,751
|
)
|
|
|
|
(949,926
|
)
|
| | | | | | | | | | | | | | |
|
Cash flows from financing activities:
| | | | | | | | | | | | | | | |
Payment of senior unsecured notes
| | | |
-
| | | | |
-
| | | | |
-
| | | | |
-
| | | | |
(392,790
|
)
|
Proceeds from debt
| | | |
-
| | | | |
1,995,398
| | | | |
-
| | | | |
1,995,398
| | | | |
493,880
| |
Proceeds from derivative instruments
| | | |
-
| | | | |
-
| | | | |
-
| | | | |
-
| | | | |
10,952
| |
Term loan repayments
| | | |
(1,995,398
|
)
| | | |
-
| | | | |
-
| | | | |
(1,995,398
|
)
| | | |
(60,108
|
)
|
Dividend payments to shareholders
| | | |
(116,308
|
)
| | | |
(116,098
|
)
| | | |
(105,938
|
)
| | | |
(454,225
|
)
| | | |
(405,955
|
)
|
Repurchase of common stock
| | | |
(187,375
|
)
| | | |
(57,394
|
)
| | | |
(42,809
|
)
| | | |
(356,346
|
)
| | | |
(60,529
|
)
|
Proceeds from employee stock plans
| | | |
21,533
| | | | |
36,045
| | | | |
44,399
| | | | |
200,114
| | | | |
306,277
| |
Excess tax benefit - stock options
| | | |
882
| | | | |
9,322
| | | | |
1,098
| | | | |
22,231
| | | | |
16,171
| |
Contingent consideration payment
| | | |
-
| | | | |
(1,803
|
)
| | | |
(1,913
|
)
| | | |
(3,576
|
)
| | | |
(5,665
|
)
|
Change in other financing activities
|
|
|
|
(1,178
|
)
|
|
|
|
5,406
|
|
|
|
|
4,696
|
| | |
|
15,192
|
|
|
|
|
(2,790
|
)
|
Net cash (used for) provided by financing activities
|
|
|
|
(2,277,844
|
)
|
|
|
|
1,870,876
|
|
|
|
|
(100,467
|
)
| | |
|
(576,610
|
)
|
|
|
|
(100,557
|
)
|
Effect of exchange rate changes on cash
|
|
|
|
(1,449
|
)
|
|
|
|
(433
|
)
|
|
|
|
725
|
| | |
|
(3,097
|
)
|
|
|
|
1,394
|
|
| | | | | | | | | | | | | | |
|
Net (decrease) increase in cash and cash equivalents
| | | |
(2,016,208
|
)
| | | |
2,182,651
| | | | |
(67,979
|
)
| | | |
177,144
| | | | |
(136,744
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
|
2,585,441
|
|
|
|
|
402,790
|
|
|
|
|
460,068
|
| | |
|
392,089
|
|
|
|
|
528,833
|
|
Cash and cash equivalents at end of period
|
|
|
$
|
569,233
|
|
|
|
$
|
2,585,441
|
|
|
|
$
|
392,089
|
| | |
$
|
569,233
|
|
|
|
$
|
392,089
|
|
| | | | | | | | | | | | | | | | | | | | | | | | |
|
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
Analog Devices, Fourth Quarter, Fiscal 2014 |
| | | | | | | | | | | | | | | | | |
|
Schedule D |
Revenue Trends by End Market (Unaudited) |
The categorization of revenue by end market is determined using a
variety of data points including the technical characteristics of
the product, the “sold to” customer information, the "ship to"
customer information and the end customer product or application
into which our product will be incorporated. As data systems for
capturing and tracking this data evolve and improve, the
categorization of products by end market can vary over time. When
this occurs we reclassify revenue by end market for prior periods.
Such reclassifications typically do not materially change the sizing
of, or the underlying trends of results within, each end market. The
results below are inclusive of the Hittite acquisition from the
acquisition date, July 22, 2014 and the consumer end market results
are reflective of the sale of the Company's microphone product line
in the fourth quarter of fiscal 2013.
|
| | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| | | Three Months Ended |
| | | Nov. 1, 2014 | | | Aug. 2, 2014 | | | Nov. 2, 2013 |
| | | Revenue |
|
| % |
|
|
| Q/Q % |
|
| Y/Y % | | | Revenue | | | Revenue |
Industrial
| | |
$
|
369,241
| | |
45
|
%
| | |
6
|
%
| | |
19
|
%
| | |
$
|
349,821
| | |
$
|
311,526
|
Automotive
| | | |
134,493
| | |
17
|
%
| | |
3
|
%
| | |
2
|
%
| | | |
129,964
| | | |
131,400
|
Consumer
| | | |
92,329
| | |
11
|
%
| | |
14
|
%
| | |
-3
|
%
| | | |
80,915
| | | |
95,096
|
Communications
| | |
|
218,184
|
|
|
27
|
%
| | |
31
|
%
| | |
56
|
%
| | |
|
167,052
| | |
|
140,111
|
Total Revenue | | | $ | 814,247 |
|
| 100 | % | | | 12 | % | | | 20 | % | | | $ | 727,752 | | | $ | 678,133 |
| | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | |
|
| | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| | | Twelve Months Ended |
| | | Nov. 1, 2014 | | | | | | | | | Nov. 2, 2013 |
| | | Revenue |
|
| % |
|
|
| Y/Y % | | | | | | | | | Revenue |
Industrial
| | |
$
|
1,333,694
| | |
47
|
%
| | |
10
|
%
| | | | | | | | |
$
|
1,215,829
|
Automotive
| | | |
524,867
| | |
18
|
%
| | |
9
|
%
| | | | | | | | | |
483,445
|
Consumer
| | | |
325,222
| | |
11
|
%
| | |
-20
|
%
| | | | | | | | | |
404,548
|
Communications
| | |
|
680,990
|
|
|
24
|
%
| | |
29
|
%
| | | | | | | | |
|
529,867
|
Total Revenue | | | $ | 2,864,773 |
|
| 100 | % | | | 9 | % | | | | | | | | | $ | 2,633,689 |
| | | | | | | | | | | | | | | | | |
|
|
|
| |
|
| |
|
| |
|
| |
|
| |
Analog Devices, Fourth Quarter, Fiscal 2014 |
| | | | | | | | | | | | | | |
|
Schedule E |
Reconciliation from GAAP to Non-GAAP Data (In thousands, except
per-share amounts) (Unaudited) |
| | | | | | | | | | | | | | |
|
See "Non-GAAP Financial Information" in this press release for a
description of the items excluded from our non-GAAP measures. |
| | |
|
| |
| |
|
| | |
|
|
|
|
| | | Three Months Ended | | | Twelve Months Ended |
| | | 4Q 14 | | | 3Q 14 | | | 4Q 13 | | | FY 14 | | | FY 13 |
| | | Nov. 1, 2014 | | | Aug. 2, 2014 | | | Nov. 2, 2013 | | | Nov. 1, 2014 | | | Nov. 2, 2013 |
| | | | | | | | | | | | | | |
|
GAAP Revenue | | | $ | 814,247 | | | | $ | 727,752 | | | | $ | 678,133 | | | | $ | 2,864,773 | | | | $ | 2,633,689 | |
Y/Y Revenue growth % | | | | | | | | | | | | | 9 | % | | | | -2 | % |
Q/Q Revenue growth % | | | | 12 | % | | | | 5 | % | | | | 1 | % | | | | | | |
Hittite Operations
| | |
|
-
|
| | |
|
(5,392
|
)
| | |
|
-
|
| | |
|
(5,392
|
)
| | |
|
-
|
|
Non-GAAP Revenue | | | $ | 814,247 |
| | | $ | 722,360 |
| | | $ | 678,133 |
| | | $ | 2,859,381 |
| | | $ | 2,633,689 |
|
Y/Y Revenue growth % | | | | | | | | | | | | | 9 | % | | | | -2 | % |
Q/Q Revenue growth % | | | | 13 | % | | | | 4 | % | | | | 1 | % | | | | | | |
| | | | | | | | | | | | | | |
|
GAAP Gross Margin | | | $ | 486,037 | | | | $ | 476,290 | | | | $ | 444,870 | | | | $ | 1,830,188 | | | | $ | 1,692,411 | |
Gross Margin Percentage | | | | 59.7 | % | | | | 65.4 | % | | | | 65.6 | % | | | | 63.9 | % | | | | 64.3 | % |
Hittite Operations
| | | |
-
| | | | |
(3,015
|
)
| | | |
-
| | | | |
(3,015
|
)
| | | |
-
| |
Acquisition-Related Expenses
| | | |
54,388
| | | | |
6,837
| | | | |
-
| | | | |
61,225
| | | | |
-
| |
Stock-Based Compensation Expense
| | |
|
(113
|
)
| | |
|
-
|
| | |
|
-
|
| | |
|
(113
|
)
| | |
|
-
|
|
Non-GAAP Gross Margin | | | $ | 540,312 |
| | | $ | 480,112 |
| | | $ | 444,870 |
| | | $ | 1,888,285 |
| | | $ | 1,692,411 |
|
Gross Margin Percentage | | | | 66.4 | % | | | | 66.5 | % | | | | 65.6 | % | | | | 66.0 | % | | | | 64.3 | % |
| | | | | | | | | | | | | | |
|
GAAP Operating Expenses | | | $ | 336,108 | | | | $ | 273,744 | | | | $ | 245,008 | | | | $ | 1,077,704 | | | | $ | 939,336 | |
Percent of Revenue | | | | 41.3 | % | | | | 37.6 | % | | | | 36.1 | % | | | | 37.6 | % | | | | 35.7 | % |
Hittite Operations
| | | |
-
| | | | |
(2,033
|
)
| | | |
-
| | | | |
(2,033
|
)
| | | |
-
| |
Acquisition-Related Expenses
| | | |
(27,166
|
)
| | | |
(5,284
|
)
| | | |
-
| | | | |
(32,450
|
)
| | | |
-
| |
Acquisition-Related Transaction Costs
| | | |
(5,987
|
)
| | | |
(21,123
|
)
| | | |
-
| | | | |
(27,110
|
)
| | | |
-
| |
Restructuring-Related Expense
| | | |
(34,637
|
)
| | | |
-
| | | | |
(15,777
|
)
| | | |
(37,322
|
)
| | | |
(29,848
|
)
|
Stock-Based Compensation Expense
| | |
|
1,302
|
| | |
|
-
|
| | |
|
-
|
| | |
|
1,302
|
| | |
|
(6,273
|
)
|
Non-GAAP Operating Expenses | | | $ | 269,620 |
| | | $ | 245,304 |
| | | $ | 229,231 |
| | | $ | 980,091 |
| | | $ | 903,215 |
|
Percent of Revenue | | | | 33.1 | % | | | | 34.0 | % | | | | 33.8 | % | | | | 34.3 | % | | | | 34.3 | % |
| | | | | | | | | | | | | | |
|
GAAP Operating Income/Margin | | | $ | 149,929 | | | | $ | 202,546 | | | | $ | 199,862 | | | | $ | 752,484 | | | | $ | 753,075 | |
Percent of Revenue | | | | 18.4 | % | | | | 27.8 | % | | | | 29.5 | % | | | | 26.3 | % | | | | 28.6 | % |
Hittite Operations
| | | |
-
| | | | |
(982
|
)
| | | |
-
| | | | |
(982
|
)
| | | |
-
| |
Acquisition-Related Expenses
| | | |
81,554
| | | | |
12,121
| | | | |
-
| | | | |
93,675
| | | | |
-
| |
Acquisition-Related Transaction Costs
| | | |
5,987
| | | | |
21,123
| | | | |
-
| | | | |
27,110
| | | | |
-
| |
Restructuring-Related Expense
| | | |
34,637
| | | | |
-
| | | | |
15,777
| | | | |
37,322
| | | | |
29,848
| |
Stock-Based Compensation Expense
| | |
|
(1,415
|
)
| | |
|
-
|
| | |
|
-
|
| | |
|
(1,415
|
)
| | |
|
6,273
|
|
Non-GAAP Operating Income/Margin | | | $ | 270,692 |
| | | $ | 234,808 |
| | | $ | 215,639 |
| | | $ | 908,194 |
| | | $ | 789,196 |
|
Percent of Revenue | | | | 33.2 | % | | | | 32.5 | % | | | | 31.8 | % | | | | 31.8 | % | | | | 30.0 | % |
| | | | | | | | | | | | | | |
|
GAAP Other Expense (Income) | | | $ | 11,231 | | | | $ | 5,158 | | | | $ | (82,650 | ) | | | $ | 23,139 | | | | $ | (62,248 | ) |
Percent of Revenue | | | | 1.4 | % | | | | 0.7 | % | | | | -12.2 | % | | | | 0.8 | % | | | | -2.4 | % |
Acquisition-Related Debt Costs
| | | |
(4,823
|
)
| | | |
(1,513
|
)
| | | |
-
| | | | |
(6,336
|
)
| | | |
-
| |
Gain on Sale of Product Line
| | | |
-
| | | | |
-
| | | | |
85,444
| | | | |
-
| | | | |
85,444
| |
Loss on Extinguishment of Debt
| | |
|
-
|
| | |
|
-
|
| | |
|
-
|
| | |
|
-
|
| | |
|
(10,205
|
)
|
Non-GAAP Other Expense | | | $ | 6,408 |
| | | $ | 3,645 |
| | | $ | 2,794 |
| | | $ | 16,803 |
| | | $ | 12,991 |
|
Percent of Revenue | | | | 0.8 | % | | | | 0.5 | % | | | | 0.4 | % | | | | 0.6 | % | | | | 0.5 | % |
| | | | | | | | | | | | | | |
|
GAAP Diluted EPS | | | $ | 0.34 | | | | $ | 0.57 | | | | $ | 0.64 | | | | $ | 1.98 | | | | $ | 2.14 | |
Impact of Loss on Extinguishment of Debt
| | | |
-
| | | | |
-
| | | | |
-
| | | | |
-
| | | | |
0.02
| |
Hittite Operations
| | | |
-
| | | | |
-
| | | | |
-
| | | | |
-
| | | | |
-
| |
Acquisition-Related Expenses
| | | |
0.25
| | | | |
0.02
| | | | |
-
| | | | |
0.27
| | | | |
-
| |
Acquisition-Related Transaction Costs
| | | |
0.01
| | | | |
0.04
| | | | |
-
| | | | |
0.05
| | | | |
-
| |
Acquisition-Related Debt Costs
| | | |
0.01
| | | | |
-
| | | | |
-
| | | | |
0.01
| | | | |
-
| |
Acquisition-Related Tax Impact
| | | |
(0.02
|
)
| | | |
-
| | | | |
-
| | | | |
(0.02
|
)
| | | |
-
| |
Impact of Gain on Sale of Product Line
| | | |
-
| | | | |
-
| | | | |
(0.19
|
)
| | | |
-
| | | | |
(0.19
|
)
|
Restructuring-Related Expense
| | | |
0.09
| | | | |
-
| | | | |
0.05
| | | | |
0.10
| | | | |
0.08
| |
Impact of the Reversal of Prior Period Tax Liabilities
| | | |
-
| | | | |
-
| | | | |
(0.01
|
)
| | | |
-
| | | | |
(0.03
|
)
|
Stock-Based Compensation Expense
| | | |
-
| | | | |
-
| | | | |
-
| | | | |
-
| | | | |
0.01
| |
Impact of Tax Reserve
| | | |
-
| | | | |
-
| | | | |
0.13
| | | | |
-
| | | | |
0.13
| |
Impact of the Reinstatement of the R&D Tax Credit
| | | |
-
| | | | |
-
| | | | |
-
| | | | |
-
| | | | |
(0.02
|
)
|
Impact of Expired Tax Statute
| | |
|
-
|
| | |
|
-
|
| | |
|
-
|
| | |
|
-
|
| | |
|
(0.01
|
)
|
Non-GAAP Diluted EPS (1) | | | $ | 0.69 |
| | | $ | 0.63 |
| | | $ | 0.62 |
| | | $ | 2.39 |
| | | $ | 2.15 |
|
| | | | | | | | | | | | | | |
|
(1) The sum of the individual per share amounts may not equal the
total due to rounding
|
| | | | | | | | | | | | | | |
|
Contacts:
Analog Devices, Inc.
Mr. Ali Husain, 781-461-3282
781-461-3491
(fax)
investor.relations@analog.com
Source: Analog Devices, Inc.
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