Product category:
Power Supply ICs and Controllers
News Release from: Micrel
Edited by the Electronicstalk Editorial
Team on 05 February 2007
Excellent year for Micrel
Micrel has announced financial results for the fourth quarter and year ended 31st December 2006.
Micrel has announced financial results for the fourth quarter and year ended 31st December 2006 Revenues for the fourth quarter were US $64.5 million, a decrease of 12% from third quarter revenues of $73.5 million and 1% lower than revenues of $65.1 million recorded in the year-ago period
This article was originally published on Electronicstalk on 5 Dec 2000 at 8.00am (UK)
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Fourth quarter net income was $8.5 million, or $0.11 per diluted share compared with net income of $11.8 million, or $0.15 per diluted share in the third quarter and net income of $9.9 million, or $0.11 per diluted share in the year ago period.
Non-GAAP net income was $10.2 million, or $0.13 per diluted share, compared with $12.3 million, or $0.15 per diluted share in the third quarter, and $9.9 million, or $0.11 per share in the fourth quarter of 2005.
Non-GAAP results exclude the impact of revenue and cost of revenues related to intellectual property settlements, equity-based compensation, other unusual operating income and expense items, restructuring charges and related tax effects.
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For the year ended 31st December 2006, revenues were $276.3 million, a 10.4% increase from $250.4 million in 2005.
Net income was $38.0 million, or $0.46 per diluted share, compared with net income of $25.4 million, or $0.29 per share in 2005.
2006.
Non-GAAP net income was $45.3 million, a 42% increase from 2005 non-GAAP net income of $31.9 million.
2006 non-GAAP income per diluted share increased 53% to $0.55 from $0.36 per diluted share in 2005.
Micrel's 2006 gross margin of 57.9% was the highest in the company's history.
2006 GAAP operating income increased to $57.5 million, or 20.8% of revenues, compared with 2005 GAAP operating income of $33.1 million, or 13.2% of revenues.
Non-GAAP operating income in 2006 increased more than 50% on a year-over-year basis to $65.3 million with non-GAAP operating margins improving to 23.9%, up from 17.2% in 2005.
During 2006, the Company repurchased 6.7 million shares of common stock totalling $71.5 million.
"2006 was an excellent year for Micrel", stated Ray Zinn, President and CEO of Micrel.
"On an annual basis, revenues, net income and earnings per share were each at the second highest level in the history of the company".
"Gross margin increased for the fourth consecutive year and reached an all-time high, exceeding previous peak levels recorded in the year 2000 when revenues were 25% higher than 2006".
"In addition, operating income and net income increased significantly, and continued to grow much faster than our revenue growth rate, reflecting the operating leverage in our business model".
"The company's cash flows also remained strong, with operating cash flows of $59 million in 2006".
"In the fourth quarter, our customers continued to carefully control their inventory levels and align their purchases with forecasted end demand for their products".
"With the market perception that semiconductor components are readily available, the electronics supply chain is relying on semiconductor suppliers to hold enough inventory to respond to short order lead times".
"This has led to an inventory correction that Micrel and the rest of the semiconductor industry is currently working through".
Fourth quarter bookings were slightly below third quarter levels primarily due to depressed order rates in December as customers attempted to minimise year-end inventory.
This resulted in a book-to-bill ratio below one for the fourth quarter.
As a result, the company has less visibility than at the same time last quarter, making it difficult to accurately predict first quarter revenues.
Order lead times for the company's products remain fairly stable at four to six weeks, but a relatively high proportion of quarterly revenue must still be booked and shipped within the quarter to OEM customers, or resold through the company's distributors.
Although bookings in January have increased from December levels, quarter-to-date new order rates and distributor resales have not been sufficient to ensure revenue growth in the first quarter.
Based on current backlog levels and demand estimates, the company projects first quarter 2007 revenues will decrease sequentially by 1-5%, and GAAP earnings per diluted share will be in a range of $0.08 to $0.09.
Zinn concluded: "While we are getting off to a relatively slow start in 2007, we believe that the inventory correction that we have been experiencing is bottoming".
"Order momentum has picked up over the last couple of weeks and is expected to improve over the balance of the quarter".
"The world economy appears to be healthy and customer forecasts are encouraging".
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