Product category:
Intellectual Property Cores
News Release from: Mosaid
Edited by the Electronicstalk Editorial
Team on 27 February 2007
Memory designer sees revenues and
profits grow
Semiconductor designer announces financial results for the third quarter of fiscal 2007, ended January 31, 2007.
Mosaid Technologies has announced financial results for the third quarter of fiscal 2007, ended 31st January 2007 Q3 revenues were US $18.7million, up 13% from $16.5million in the fiscal 2006 third quarter
This article was originally published on Electronicstalk on 4 Nov 2003 at 8.00am (UK)
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Third quarter revenues were higher primarily due to patent licenses with Infineon Technologies AG and Qimonda AG.
Net income for the third quarter was $4.3million or $0.38 per diluted share, up from $3.6million or $0.31 per diluted share in the third quarter of fiscal 2006.
Third quarter net income was reduced by unusual expenses of $840,000 related to the company's strategic alternatives initiative.
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There were no such expenses in the comparative period for fiscal 2006.
For the first nine months of fiscal 2007, revenues were $61.3 million, up 30% from $47.0million for the comparable period in fiscal 2006.
Net income in the first nine months of the current fiscal year was $15.7million or $1.38 per diluted share, up 28% from $12.3million or $1.07 per diluted share in the first nine months of fiscal 2006.
Costs related to the strategic alternative initiative totaled $2.0million in the first nine months of fiscal 2007.
There were no such costs in the comparative period last year.
Mosaid has executed on two elements of its strategic alternatives initiative, announcing a Systems Division asset sale and business wind down, and a major acquisition of wireless patents.
The company announced the sale of the principal assets of its automatic test equipment (ATE) business to Teradyne for $20million in cash, and the orderly wind-down of this business.
Mosaid anticipates that this transaction will result in a pre-tax gain, including the impact of discontinued operations, of approximately $13million, reportable in the fourth quarter, ending April 30, 2007.
In addition, Mosaid announced the purchase of a valuable portfolio of essential patents related to WiFi and WiMAX technology from Agere Systems.
The company believes that the licensing revenue from this portfolio of 23 issued and pending patents has the potential to surpass the revenues that Mosaid has earned to date from its DRAM memory patents.
"The asset sale and patent acquisition are important steps in Mosaid's strategic alternatives initiative, resulting in a company that is sharply focused on developing and licensing intellectual property", says George Cwynar, President and Chief Executive Officer, Mosaid.
"As we continue to pursue the strategic alternatives initiative, we are also taking steps today to rationalise our semiconductor intellectual property products portfolio".
"In the third quarter, we continued to demonstrate steady financial performance while engaged in the strategic alternatives initiative, and we remain on track to deliver the best financial results in the company's history", says Richard Boadway, Executive Vice President and Chief Financial Officer, Mosaid.
"In the intellectual property (IP) Division, the patent licensing program delivered excellent results but the semiconductor IP products group again performed below expectations".
"It is our view that the DDR memory controller and PLL timing product portfolios are competitive in the marketplace".
"However, our Mobilize product family has not met with market acceptance, so we are stopping further development and reducing our cost structure accordingly, which will require a restructuring charge of $6million to $6.5million".
"Mosaid's patents on the low-power circuit techniques of Mobilize may yield an attractive future patent licensing opportunity".
The wind-down of the Systems Division on April 30 and staff reductions in the Semiconductor IP and corporate groups will result in a staff reduction of 57 employees from the current base of 116 employees.
At the end of the fiscal 2007 third quarter, the company had cash and marketable securities of $63.6million, compared with $67.2million at the end of the second quarter.
Working capital declined marginally in the quarter.
Mosaid expects net cash proceeds from the sale of systems-division assets to be $16million, with cash costs of the announced semiconductor IP restructuring actions to be approximately $1million, resulting in a net cash gain of approximately $15million.
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