Product category:
Power Supply ICs and Controllers
News Release from: International Rectifier
Edited by the Electronicstalk Editorial
Team on 29 January 2007
IR poised for higher levels of
profitability
International Rectifier has reported fiscal second quarter adjusted earnings of US $42.5 million on adjusted consolidated revenue of $354.7 million.
International Rectifier has reported fiscal second quarter results, with adjusted earnings of US $42.5 million (or $0.58 per share) on adjusted consolidated revenue of $354.7 million This compares to adjusted earnings of $37.8 million (or $0.52 per share) for the September 2006 quarter on adjusted consolidated revenue of $344.2 million
This article was originally published on Electronicstalk on 15 Feb 2001 at 8.00am (UK)
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For the prior-year December 2005 quarter, adjusted earnings were $26.5 million (or $0.37 per share) on adjusted consolidated revenue of $278.8 million.
On a GAAP basis, net income was $71.9 million (or $0.99 per share) for the December 2006 quarter versus $34.1 million (or $0.47 per share) for the September 2006 quarter and $24.3 million (or $0.34 per share) for the prior year December 2005 quarter.
On a GAAP basis, revenue was $327.6 million, $315.8 million and $254.8 million for the December 2006, September 2006, and December 2005 quarters, respectively.
Further reading
MOSFETs improve power density on both sides
New from International Rectifier are two TO-220-packaged HEXFET power MOSFETs that maximise power density and performance in primary- and secondary-side DC/DC convertor circuits.
Rad-hard MOSFETs protect and survive
With high radiation hardness and unparalleled single event effect (SEE) immunity, International Rectifier's new R5 MOSFETs are well suited for systems that must survive penetrating gamma rays.
Reference design simplifies high-efficiency PSUs
International Rectifier has released a reference design for its recently introduced IR1176 application-specific synchronous rectification IC (SRIC).
GAAP revenue excluded $27.1 million, $28.4 million and $24.0 million of revenue from discontinued operations for the December 2006, September 2006, and December 2005 quarters, respectively, which were included in adjusted revenue.
As a result of the contemplated sale of the company's power control systems (PCS) business and in compliance with GAAP, IR has reported the nonaligned product segment's financial results as discontinued operations.
Commodity Product financial results were not included in discontinued operations at this time, as the company expects to have significant ongoing involvement from certain transitional foundry and other services to be provided to Vishay following the divestiture.
The company's prior period GAAP financials have been restated to conform to current period presentation.
IR's adjusted earnings for the December 2006 quarter excluded $26.5 million (or $0.36 per share) of tax benefit relating to the recognition of deferred tax assets tied to the difference in book and tax basis of certain subsidiaries being sold as part of the sale of IR's PCS business, $4.3 million (or $0.06 per share) of prior period research and development tax benefit relating to Congress reinstating the research and development tax credit retroactive to the beginning of January 2006, and $2.0 million (or $0.02 per share) of pretax severance and restructuring charges.
IR's adjusted earnings included the nonaligned product segment which was reported in the discontinued operations under GAAP.
This was $0.5 million of pretax earnings in the December 2006 quarter.
Adjusted earnings for the September 2006 and the December 2005 quarters excluded $5.2 million and $3.0 million of pretax severance and restructuring charges, respectively, and included $0.3 million of pretax earnings and $4.3 million of pretax losses from discontinued operations, respectively.
CEO Alex Lidow said: "In the December quarter, revenue and backlog both hit records on the strength of our focus products, with revenue up 6% over the prior quarter and 31% over the prior year".
"The company enjoyed healthy business conditions, with total company orders up 5% over the prior quarter and 32% from a year ago".
"Gross margin improved 80 basis points over the prior quarter in computing and communications, our largest business segment".
"Focus Product gross margin increased 40 basis points from the prior quarter from a shift in product mix".
"Ongoing major design wins supported continuing growth in energy saving products revenue, up 10% over the prior quarter, and in computing and communications, up 6% in the same period".
"Customer demand was strong for flat panel TVs and energy-efficient appliances".
"We are also encouraged by the first wave of new business related to Microsoft's Vista introduction at the notebook and desktop levels as well as strength in new families of Intel and AMD-based servers".
"We completed the second phase of our capacity expansion in October 2006, providing IR with $300 million in annual revenue output potential".
"In addition, we expect to add another $150 million in revenue potential to be completed by mid-calendar year under the third phase of the expansion".
"This will provide the needed headroom to meet customer requirements and improve profitability".
Adjusted gross margin rose 50 basis points in the December quarter to 40.7% versus 40.2% in the September quarter and 40.0% in the prior-year December 2005 quarter.
On a GAAP basis, gross margin was 43.0% for the December 2006 quarter versus 42.2% in the September 2006 quarter and 43.0% for the prior-year December 2005 quarter which excluded $3.8 million, $5.0 million and $2.0 million of gross profit from discontinued operations for the December 2006, September 2006 and December 2005 quarters, respectively.
In the December quarter, IR's focus product revenue accounted for 77% of consolidated revenue.
Revenue from IR's commodity product and nonaligned product segments was 23% of total revenue, decreasing 6% over the September quarter.
In the December quarter, adjusted selling, general and administrative (SG and A) expense was $53.0 million, or 15.0% of adjusted revenue, down from $53.5 million, or 15.5% of adjusted revenue, in the prior quarter.
GAAP SG and A expense was $51.4 million, or 15.7% of revenue, which excluded $1.6 million of SG and A expense from discontinued operations, compared with the prior quarter of $51.4 million, or 16.3% of revenue, which excluded $2.1 million of SG and A expense from discontinued operations.
Adjusted research and development (R and D) expense in the December quarter was $35.2 million, or 9.9% of adjusted revenue, compared with $32.1 million, or 9.3% of adjusted revenue, in the prior quarter.
GAAP R and D expense was $34.0 million, or 10.4% of revenue, excluding $1.2 million of R and D expense from discontinued operations, compared with the prior quarter of $30.8 million, or 9.7% of revenue, excluding $1.3 million of R and D expense for discontinued operations.
In the December quarter, cash flow from operations was $71.6 million.
This was an increase of $60.3 million from the prior quarter.
Cash and cash investments was $1.1 billion at the end of the quarter.
For the March quarter, IR expects overall company revenue to be flat +/-2% from the December quarter.
Backlog currently stands at approximately 80% of target shipments.
IR expects adjusted total company March-quarter gross margin to be flat plus or minus 50 basis points sequentially.
Lidow stated: "While industry conditions appear uncertain over the near term, IR is in a favourable position with positive order momentum and record backlog".
"Major design wins from a wide variety of leading technology companies continue to play a key role in allowing IR's focus products business to outperform the industry".
"IR is helping to set standards in selected high performance, fast growing analogue, mixed-signal, and digital markets which is giving us further confidence in our long-term business model".
"Last year, we decided to more narrowly aim IR's strategic interests by divesting our power control systems business, and this is nearly complete".
"We have taken many steps over the past 18 months to enhance the company's ability to grow rapidly and are now positioned to return to higher levels of profitability in calendar year 2007".
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