EX-99.2 3 c09444exv99w2.htm EXHIBIT 99.2 Exhibit 99.2
Exhibit 99.2
SEMTECH CORPORATION
CONSOLIDATED STATEMENTS OF INCOME

(Table in thousands — except per share amount)
                                         
    Three Months Ended October 31, 2010     Three Months Ended  
    Originally                     Aug 1,     Oct 25,  
    Reported     Adjustments(1)     Revised     2010     2009  
    Q3 2011     Q3 2011     Q3 2011     Q2 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
 
                                       
Net sales
  $ 123,125     $     $ 123,125     $ 113,227     $ 75,147  
Cost of sales
    49,304             49,304       45,795       33,776  
 
                             
Gross profit
    73,821             73,821       67,432       41,371  
Operating costs and expenses:
                                       
Selling, general and administrative
    25,501       10,000       35,501       24,915       18,521  
Product development and engineering
    18,400             18,400       17,404       10,467  
Amortization of acquired intangible assets
    2,406             2,406       2,405       303  
 
                             
Total operating costs and expenses
    46,307       10,000       56,307       44,724       29,291  
 
                             
Operating income
    27,514       (10,000 )     17,514       22,708       12,080  
Interest and other income, net
    3             3       308       1,136  
 
                             
Income before taxes
    27,517       (10,000 )     17,517       23,016       13,216  
Provision for taxes
    3,916       (2,504 )     1,412       3,354       34,103  
 
                             
Net income
  $ 23,601     $ (7,496 )   $ 16,105     $ 19,662     $ (20,887 )
 
                             
 
                                       
Earnings per share:
                                       
Basic
  $ 0.38     $ (0.12 )   $ 0.26     $ 0.32     $ (0.34 )
Diluted
  $ 0.37     $ (0.12 )   $ 0.25     $ 0.31     $ (0.34 )
 
                                       
Weighted average number of shares:
                                       
Basic
    62,493               62,493       61,933       61,030  
Diluted
    64,555               64,555       63,552       61,030  
                                 
    Nine Months Ended October 31, 2010     Nine Months Ended  
    Originally                     Oct 25,  
    Reported     Adjustments(1)     Revised     2009  
    Q3 2011     Q3 2011     Q3 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
 
                               
Net sales
  $ 338,232     $     $ 338,232     $ 201,541  
Cost of sales
    139,932             139,932       91,286  
 
                       
Gross profit
    198,300             198,300       110,255  
Operating costs and expenses:
                               
Selling, general and administrative
    76,767       10,000       86,767       52,717  
Product development and engineering
    51,107             51,107       31,142  
Amortization of acquired intangible assets
    7,216             7,216       908  
 
                       
Total operating costs and expenses
    135,090       10,000       145,090       84,767  
 
                       
Operating income
    63,210       (10,000 )     53,210       25,488  
Interest and other income, net
    508             508       2,708  
 
                       
Income before taxes
    63,718       (10,000 )     53,718       28,196  
Provision for taxes
    9,653       (2,504 )     7,149       36,719  
 
                       
Net income
  $ 54,065     $ (7,496 )   $ 46,569     $ (8,523 )
 
                       
 
                               
Earnings per share:
                               
Basic
  $ 0.87     $ (0.12 )   $ 0.75     $ (0.14 )
Diluted
  $ 0.85     $ (0.12 )   $ 0.73     $ (0.14 )
 
                               
Weighted average number of shares:
                               
Basic
    61,950               61,950       60,622  
Diluted
    63,723               63,723       60,622  
(1)  
Adjustments made to recognize subsequent event under US GAAP. Financial statements will be issued on or about December 10, 2010.

 

 


 

SEMTECH CORPORATION
CONSOLIDATED BALANCE SHEETS

(Table in thousands)
                                 
    October 31, 2010        
    Originally                     Jan 31,  
    Reported     Adjustments (1)     Revised     2010  
    (Unaudited)     (Unaudited)     (Unaudited)          
ASSETS
                               
Current assets:
                               
Cash and cash equivalents
  $ 142,209     $     $ 142,209     $ 80,598  
Temporary investments
    42,686             42,686       55,462  
Receivables, less allowances
    58,911             58,911       31,163  
Inventories
    43,203             43,203       33,819  
Deferred income taxes
    11,808             11,808       11,808  
Other current assets
    11,925             11,925       6,616  
 
                       
Total current assets
    310,742             310,742       219,466  
 
                               
Property, plant and equipment, net
    50,568             50,568       38,063  
Long-term investments
    43,810             43,810       26,163  
Deferred income taxes
    2,392       2,504       4,896       7,153  
Goodwill
    129,651             129,651       129,651  
Other intangible assets, net
    77,127             77,127       84,343  
Other assets
    14,865             14,865       9,455  
 
                       
Total assets
  $ 629,155     $ 2,504     $ 631,659     $ 514,294  
 
                       
 
                               
LIABILITIES AND SHAREHOLDERS’ EQUITY
                               
Current liabilities:
                               
Accounts payable
  $ 36,273     $     $ 36,273     $ 23,643  
Accrued liabilities
    38,946       10,000       48,946       34,008  
Income taxes payable
    6,536             6,536       8,512  
Deferred revenue
    5,210             5,210       3,276  
Accrued taxes
    2,609             2,609       2,609  
Deferred income taxes
    1,332             1,332       1,332  
 
                       
Total current liabilities
    90,906       10,000     $ 100,906       73,380  
 
                               
Deferred income taxes — non-current
    16,505             16,505       16,505  
Accrued taxes
    9,597             9,597       9,497  
Other long-term liabilities
    14,030             14,030       9,171  
 
                               
Shareholders’ equity
    498,117       (7,496 )     490,621       405,741  
 
                       
Total liabilities & shareholders’ equity
  $ 629,155     $ 2,504     $ 631,659     $ 514,294  
 
                       
(1)  
Adjustments made to recognize subsequent event under US GAAP. Financial statements will be issued on or about December 10, 2010.

 

 


 

SEMTECH CORPORATION
SUPPLEMENTAL INFORMATION — NOTES TO CONSOLIDATED GAAP STATEMENTS OF INCOME

(Tables in thousands — except per share amounts)
                                         
    Three Months Ended October 31, 2010     Three Months Ended  
    Originally                     Aug 1,     Oct 25,  
    Reported     Adjustments     Revised     2010     2009  
Stock-based Compensation Expense   Q3 2011     Q3 2011     Q3 2011     Q2 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
Cost of sales
  $ 305     $     $ 305     $ 646     $ 284  
Selling, general and administrative
    5,206             5,206       4,702       2,658  
Product development and engineering
    1,908             1,908       1,858       1,160  
 
                             
Total stock-based compensation expense
  $ 7,419     $     $ 7,419     $ 7,206     $ 4,102  
 
                             
                                 
    Nine Months Ended October 31, 2010     Nine Months Ended  
    Originally                     Oct 25,  
    Reported     Adjustments     Revised     2009  
Stock-based Compensation Expense   Q3 2011     Q3 2011     Q3 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
Cost of sales
  $ 1,477     $     $ 1,477     $ 942  
Selling, general and administrative
    15,512             15,512       9,602  
Product development and engineering
    5,936             5,936       3,276  
 
                       
Total stock-based compensation expense
  $ 22,925     $     $ 22,925     $ 13,820  
 
                       
                                         
    Three Months Ended October 31, 2010     Three Months Ended  
    Originally                     Aug 1,     Oct 25,  
    Reported     Adjustments     Revised     2010     2009  
Gross Profit - Reconciliation GAAP to Non-GAAP   Q3 2011     Q3 2011     Q3 2011     Q2 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
 
                                       
GAAP gross profit
  $ 73,821     $     $ 73,821     $ 67,432     $ 41,371  
Adjustments to GAAP gross profit:
                                       
Stock-based compensation expense
    305             305       646       284  
Fair value adjustment related to acquired inventory
                             
 
                             
Non-GAAP gross profit
  $ 74,126     $     $ 74,126     $ 68,078     $ 41,655  
 
                             
                                 
    Nine Months Ended October 31, 2010     Nine Months Ended  
    Originally                     Oct 25,  
    Reported     Adjustments     Revised     2009  
Gross Profit - Reconciliation GAAP to Non-GAAP   Q3 2011     Q3 2011     Q3 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
 
                               
GAAP gross profit
  $ 198,300     $     $ 198,300     $ 110,255  
Adjustments to GAAP gross profit:
                               
Stock-based compensation expense
    1,477             1,477       942  
Fair value adjustment related to acquired inventory
    2,311             2,311        
 
                       
Non-GAAP gross profit
  $ 202,088     $     $ 202,088     $ 111,197  
 
                       

 

 


 

                                         
    Three Months Ended October 31, 2010     Three Months Ended  
    Originally                     Aug 1,     Oct 25,  
    Reported     Adjustments     Revised     2010     2009  
Net Income - Reconciliation GAAP to Non-GAAP   Q3 2011     Q3 2011     Q3 2011     Q2 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
 
                                       
GAAP net income
  $ 23,601     $ (7,496 )   $ 16,105     $ 19,662     $ (20,887 )
 
                                       
Adjustments to GAAP net income:
                                       
Stock-based compensation expense
    7,419             7,419       7,206       4,102  
Legal expenses related to stock option matters
    613       10,000       10,613       1,065       1,078  
Fair value adjustment related to acquired inventory
                             
Amortization of acquired intangible assets
    2,406             2,406       2,405       303  
Restructuring costs
                              50  
 
                             
Total before taxes
    10,438       10,000       20,438       10,676       5,533  
Associated tax effect
    (3,131 )     (2,985 )     (6,116 )     (3,613 )     31,597  
 
                             
Total of supplemental information net of taxes
    7,307       7,015       14,322       7,063       37,130  
 
                             
Non-GAAP net income
  $ 30,908     $ (481 )   $ 30,427     $ 26,725     $ 16,243  
 
                             
 
                                       
Diluted GAAP earnings per share
  $ 0.37     $ (0.12 )   $ 0.25     $ 0.31     $ (0.34 )
Adjustments per above
    0.11       0.11       0.22       0.11       0.61  
 
                             
Diluted non-GAAP earnings per share
  $ 0.48     $ (0.01 )   $ 0.47     $ 0.42     $ 0.27  
 
                             
                                 
    Nine Months Ended October 31, 2010     Nine Months Ended  
    Originally                     Oct 25,  
    Reported     Adjustments     Revised     2009  
Net Income - Reconciliation GAAP to Non-GAAP   Q3 2011     Q3 2011     Q3 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
 
                               
GAAP net income
  $ 54,065     $ (7,496 )   $ 46,569     $ (8,523 )
 
                               
Adjustments to GAAP net income:
                               
Stock-based compensation expense
    22,925             22,925       13,820  
Legal expenses related to stock option matters
    3,301       10,000       13,301       1,147  
Fair value adjustment related to acquired inventory
    2,311             2,311        
Amortization of acquired intangible assets
    7,216             7,216       909  
Restructuring costs
                        398  
 
                       
Total before taxes
    35,753       10,000       45,753       16,274  
Associated tax effect
    (10,138 )     (2,985 )     (13,123 )     28,757  
 
                       
Total of supplemental information net of taxes
    25,615       7,015       32,630       45,031  
 
                       
Non-GAAP net income
  $ 79,680     $ (481 )   $ 79,199     $ 36,508  
 
                       
 
                               
Diluted GAAP earnings per share
  $ 0.85     $ (0.12 )   $ 0.73     $ (0.14 )
Adjustments per above
    0.40       0.11       0.51       0.74  
 
                       
Diluted non-GAAP earnings per share
  $ 1.25     $ (0.01 )   $ 1.24     $ 0.60  
 
                       

 

 


 

                                         
    Three Months Ended October 31, 2010     Three Months Ended  
    Originally                     Aug 1,     Oct 25,  
    Reported     Adjustments     Revised     2010     2009  
Tax Impact Associated With Supplemental Information   Q3 2011     Q3 2011     Q3 2011     Q2 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
 
                                       
Adjustments to GAAP net income:
                                       
Stock-based compensation expense
  $ 2,881     $     $ 2,881     $ 2,703     $ 705  
Transaction and other expenses
                          $ (32,801 )
Legal expenses related to stock option matters
    250       2,985 (2)     3,235       263       406  
Fair value adjustment related to acquired inventory
                             
Amortization of acquired intangible assets
                      647       85  
Restructuring costs
                            8  
 
                             
Total of associated tax effect
  $ 3,131     $ 2,985     $ 6,116     $ 3,613     $ (31,597 )
 
                             
                                 
    Nine Months Ended October 31, 2010     Nine Months Ended  
    Originally                     Oct 25,  
    Reported     Adjustments     Revised     2009  
Tax Impact Associated With Supplemental Information   Q3 2011     Q3 2011     Q3 2011     Q3 2010  
    (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
 
                               
Adjustments to GAAP net income:
                               
Stock-based compensation expense
  $ 6,619     $     $ 6,619     $ 3,287  
Transaction and other expenses
                    $ (32,801 )
Legal expenses related to stock option matters
    1,129       2,985 (2)     4,114       437  
Fair value adjustment related to acquired inventory
    878             878        
Amortization of acquired intangible assets
    1,512             1,512       254  
Restructuring costs
                      66  
 
                       
Total of associated tax effect
  $ 10,138     $ 2,985     $ 13,123     $ (28,757 )
 
                       
(2)  
Includes adjustments related to valuation allowances resulting from changes in anticipated tax credit utilization