Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
NOVEMBER 1, 2007
Date of Report (Date of earliest event reported)
SYNAPTICS INCORPORATED
(Exact Name of Registrant as Specified in Charter)
| DELAWARE | 000-49602 | 77-0118518 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
3120 SCOTT BLVD.
SUITE 130
SANTA CLARA, CALIFORNIA
95054
SUITE 130
SANTA CLARA, CALIFORNIA
95054
(Address of Principal Executive Offices) (Zip Code)
(408) 454-5100
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
TABLE OF CONTENTS
| Item 2.02. Results of Operations and Financial Condition | ||||||||
| Item 9.01. Financial Statements and Exhibits | ||||||||
| SIGNATURES | ||||||||
| EXHIBIT INDEX | ||||||||
| EX-99.1 | ||||||||
Table of Contents
Item 2.02. Results of Operations and Financial Condition.
The registrant is furnishing this Current Report on Form 8-K in connection with the disclosure
of information, in the form of the textual information from a press release released on November 1,
2007.
The information in this Current Report on Form 8-K (including the exhibit) is furnished
pursuant to Item 2.02 and shall not be deemed to be “filed” for the purpose of Section 18 of the
Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section.
The registrant does not have, and expressly disclaims, any obligation to release publicly any
updates or any changes in the registrant’s expectations or any change in events, conditions, or
circumstances on which any forward-looking statement is based.
The text included with this Current Report is available on the registrant’s website located at
www.synaptics.com, although the registrant reserves the right to discontinue that availability at
any time.
Item 9.01. Financial Statements and Exhibits.
| (a) | Financial Statements of Business Acquired. | ||
| Not applicable. | |||
| (b) | Pro Forma Financial Information. | ||
| Not applicable. | |||
| (c) | Shell Company Transactions. | ||
| Not applicable. | |||
| (d) | Exhibits. |
| Exhibit | ||
| Number | ||
| 99.1 | Press release from Synaptics Incorporated, dated November 1,
2007, entitled “Synaptics Reports Record Revenue in First Quarter of Fiscal
2008” |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SYNAPTICS INCORPORATED |
||||
| Date: November 1, 2007 | By: | /s/ Russell J. Knittel | ||
| Russell J. Knittel | ||||
| Executive Vice President, Chief Financial Officer, Chief Administrative Officer, and Secretary | ||||
2
Table of Contents
EXHIBIT INDEX
| Exhibit | ||
| Number | Description | |
| 99.1 | Press release from Synaptics Incorporated, dated November 1, 2007, entitled “Synaptics
Reports Record Revenue in First Quarter of Fiscal 2008” |
EXHIBIT 99.1
| For more information contact: | ||
|
Molly Plyler The Blueshirt Group 415-217-7722 molly@blueshirtgroup.com |
Synaptics Reports Record Revenue in First Quarter of Fiscal 2008
Santa Clara, CA – November 1, 2007 – Synaptics (Nasdaq: SYNA), a leading developer of human
interface solutions for mobile computing, communications, and entertainment devices, today reported
financial results for the first quarter ended September 30, 2007. The Company’s GAAP results
reflect the expensing of non-cash share-based compensation for all periods presented.
Net revenue for the first quarter of fiscal 2008 was $86.7 million, an increase of approximately
58% over the $54.8 million for the first quarter of fiscal 2007. Net income for the first quarter
of fiscal 2008 was $11.3 million, or $0.41 per diluted share, compared with net income of $4.1
million, or $0.15 per diluted share, for the first quarter of fiscal 2007. Net income for the
first quarter of fiscal 2008 included two non-recurring items resulting in a net charge of $1.3
million. Net income, excluding share-based compensation and non-recurring items, was $14.8
million, or $0.54 per diluted share, for the first quarter of fiscal 2008, compared with
$6.4 million, or $0.23 per diluted share, for the first quarter of fiscal 2007.
“Fiscal 2008 is off to a strong start as we achieved record revenue in the first quarter and
increased our net income 173% over the comparable quarter last year,” stated Francis Lee, president
and chief executive officer of Synaptics. “We continue to experience robust growth across our
markets and ongoing momentum in new design activities to incorporate our intuitive, easy-to-use
human interface solutions into next generation portable devices. We are pleased with our position
within our target markets and are excited about the emerging new market opportunities we see for
the adoption of our technology. We remain poised to deliver record revenue and profits in fiscal
2008.”
Russ Knittel, the Company’s chief financial officer, added, “Based on our backlog of $56.7 million
entering the December quarter and anticipated new orders during the quarter, we expect revenue for
our second fiscal quarter to be in the range of $96 million to $99 million, representing a 26% to
30% increase over the comparable period last year. This outlook is predicated on continued strong
seasonal trends, with increased demand from both PC and non-PC applications. We expect revenue in
the March quarter to be up 29% to 38% over the comparable quarter last year, assuming anticipated
end market sell through in the December quarter and consumer demand relative to seasonal trends in
the first calendar quarter of 2008.”
Earnings Call Information
The Synaptics first quarter teleconference and webcast is scheduled to begin at 2:00 p.m., Pacific
Time, on Thursday, November 1, 2007, during which the Company will provide forward-looking
information. To participate on the live call, analysts and investors should dial 800-366-3908 at
least ten minutes prior to the call. Synaptics will also offer a live and archived webcast of the
conference call, accessible from the “Investor Relations” section of the Company’s Web site at
www.synaptics.com.
About Synaptics Incorporated
Synaptics is a leading developer of human interface solutions for mobile computing, communications,
and entertainment devices. The Company creates interface solutions for a variety of devices
including notebook PCs, PC peripherals, digital music players, and
mobile phones. The TouchPad(TM),
Synaptics’ flagship product, is integrated into a majority of today’s notebook computers. Consumer
electronics and computing manufacturers use Synaptics’ solutions to enrich the interaction between
humans and intelligent devices through improved usability, functionality and industrial design. The
Company is headquartered in Santa Clara, California. www.synaptics.com
NOTE: Synaptics, TouchPad, and the Synaptics logo are trademarks of Synaptics in the United States
and/or other countries.
Use of Non-GAAP Financial Information
In evaluating our business, we consider and use net income per share excluding share-based
compensation and non-recurring items as a supplemental measure of operating performance. Net
income excluding share-based compensation and non-recurring items is not a measurement of our
financial performance under GAAP and should
not be considered as an alternative to net income. We present net income excluding share-based
compensation and non-recurring items because we consider it an important supplemental measure of
our performance. We believe this measure facilitates operating performance comparisons from period
to period by eliminating potential differences in net income caused by the existence and timing of
non-cash compensation charges and non-recurring items. Net income excluding share-based
compensation and non-recurring items has limitations as an analytical tool, and you should not
consider it in isolation or as a substitute for our GAAP net income. The principal limitations of
this measure are that it does not reflect our actual expenses and may thus have the effect of
inflating our net income and net income per share.
Forward-Looking Statements
This press release contains “forward-looking” statements about Synaptics, as that term is defined
under the federal securities laws. Synaptics intends such forward-looking statements to be subject
to the safe harbor created by those laws. Such forward-looking statements include, but are not
limited to, statements regarding Synaptics’ anticipated revenue, revenue growth rates and
anticipated customer orders in the second and third quarters of fiscal 2008; its beliefs regarding
the markets it serves; its position and opportunities in those markets; its assessment of market
demands and trends in target markets; and its assessment of consumer demands for various
applications. Synaptics cautions that these statements are qualified by important factors that
could cause actual results to differ materially from those reflected by the forward-looking
statements contained herein. Such factors include, but are not limited to, (a) demand for
Synaptics’ products, (b) market demand for OEMs’ products using Synaptics’ solutions, (c) changing
market demand trends in the markets it serves, and (d) other risks as identified from time to time
in Synaptics’ SEC reports, including Quarterly Reports on Form 10-Q and the Annual Report on Form
10-K for the fiscal year ended June 30, 2007. All forward-looking statements are based on
information available to Synaptics on the date hereof, and Synaptics assumes no obligation to
update such statements.
(Tables to Follow)
SYNAPTICS INCORPORATED
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
(Unaudited)
| September 30, | June 30, | |||||||
| 2007 | 2007 | |||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 101,979 | $ | 45,915 | ||||
Short term investments |
159,192 | 219,102 | ||||||
Total cash, cash equivalents, and short-term investments |
261,171 | 265,017 | ||||||
Receivables, net of allowances of $364 and $419, respectively |
65,664 | 56,721 | ||||||
Inventories |
19,476 | 12,034 | ||||||
Prepaid expenses and other current assets |
10,064 | 4,245 | ||||||
Total current assets |
356,375 | 338,017 | ||||||
Property and equipment, net |
19,848 | 19,400 | ||||||
Goodwill |
1,927 | 1,927 | ||||||
Other assets |
7,739 | 13,968 | ||||||
Total assets |
$ | 385,889 | $ | 373,312 | ||||
Liabilities and stockholders’ equity |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 21,387 | $ | 21,552 | ||||
Accrued compensation |
4,144 | 5,372 | ||||||
Income taxes payable |
— | 3,400 | ||||||
Other accrued liabilities |
6,605 | 6,272 | ||||||
Note payable |
— | 1,500 | ||||||
Total current liabilities |
32,136 | 38,096 | ||||||
Convertible senior subordinated notes |
125,000 | 125,000 | ||||||
Other liabilities |
12,991 | 2,129 | ||||||
Commitments and contingencies |
||||||||
Stockholders’ equity: |
||||||||
Preferred
stock; $.001 par value; 10,000,000 shares authorized;
no shares issued and outstanding |
— | — | ||||||
Common stock;
$.001 par value; 60,000,000 shares authorized; 30,653,597
and 29,666,660 shares issued, respectively |
31 | 30 | ||||||
Additional paid in capital |
196,913 | 180,746 | ||||||
Less: 4,088,100 and 3,588,100 treasury shares,
respectively, at cost |
(91,296 | ) | (72,345 | ) | ||||
Retained earnings |
111,057 | 99,795 | ||||||
Accumulated other comprehensive loss |
(943 | ) | (139 | ) | ||||
Total stockholders’ equity |
215,762 | 208,087 | ||||||
Total liabilities and stockholders’ equity |
$ | 385,889 | $ | 373,312 | ||||
SYNAPTICS INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
| Three Months Ended | ||||||||
| September 30, | ||||||||
| 2007 | 2006 | |||||||
Net revenue |
$ | 86,692 | $ | 54,815 | ||||
Cost of revenue (1) |
51,228 | 32,420 | ||||||
Gross margin |
35,464 | 22,395 | ||||||
Operating expenses |
||||||||
Research and development (1) |
10,402 | 9,188 | ||||||
Selling, general, and administrative (1) |
10,750 | 7,801 | ||||||
Total operating expenses |
21,152 | 16,989 | ||||||
Operating income |
14,312 | 5,406 | ||||||
Interest income |
2,995 | 2,539 | ||||||
Interest expense |
(475 | ) | (487 | ) | ||||
Gain on settlement of debt |
2,689 | — | ||||||
Impairment of investment |
(4,000 | ) | — | |||||
Income before income taxes |
15,521 | 7,458 | ||||||
Provision for income taxes (2) |
4,259 | 3,331 | ||||||
Net income |
$ | 11,262 | $ | 4,127 | ||||
Net income per share: |
||||||||
Basic |
$ | 0.43 | $ | 0.16 | ||||
Diluted |
$ | 0.41 | $ | 0.15 | ||||
Shares used
in computing net income per share: |
||||||||
Basic |
26,210 | 25,134 | ||||||
Diluted |
27,691 | 29,253 | ||||||
(1) Includes share-based compensation charges of: |
||||||||
Cost of revenue |
$ | 239 | $ | 147 | ||||
Research and development |
1,171 | 1,035 | ||||||
Selling, general, and administrative |
1,919 | 1,919 | ||||||
| $ | 3,329 | $ | 3,101 | |||||
(2) Includes tax benefit for share-based compensation charges of: |
||||||||
| $ | 1,697 | $ | 781 | |||||
Non-GAAP net income per share
|
||||||||
Basic |
$ | 0.57 | $ | 0.26 | ||||
Diluted |
$ | 0.54 | $ | 0.23 | ||||
SYNAPTICS INCORPORATED
Computation of Basic and Diluted Net Income Per Share
(in thousands, except per share data)
(Unaudited)
Computation of Basic and Diluted Net Income Per Share
(in thousands, except per share data)
(Unaudited)
| Three Months Ended | ||||||||
| September 30, | ||||||||
| 2007 | 2006 | |||||||
Numerator: |
||||||||
Basic net income |
$ | 11,262 | $ | 4,127 | ||||
Interest expense and amortization of debt issuance
costs on convertible notes, net of tax |
— | 266 | ||||||
Diluted net income |
$ | 11,262 | $ | 4,393 | ||||
Denominator: |
||||||||
Shares, basic |
26,210 | 25,134 | ||||||
Effect of dilutive share-based awards |
1,481 | 1,645 | ||||||
Effect of convertible notes |
— | 2,474 | ||||||
Shares, diluted |
27,691 | 29,253 | ||||||
Net income per share: |
||||||||
Basic |
$ | 0.43 | $ | 0.16 | ||||
Diluted |
$ | 0.41 | $ | 0.15 | ||||
Computation of non-GAAP basic and diluted net income per share (unaudited): |
||||||||
Numerator: |
||||||||
Reported net income |
$ | 11,262 | $ | 4,127 | ||||
Non-GAAP adjustments: |
||||||||
Gain on settlement of debt, net of tax |
(2,078 | ) | — | |||||
Impairment of investment, net of tax |
4,000 | — | ||||||
Share-based compensation, net of tax |
1,632 | 2,320 | ||||||
Non-GAAP basic net income |
14,816 | 6,447 | ||||||
Interest expense and amortization of debt issuance
costs on convertible notes, net of tax |
— | 266 | ||||||
Non-GAAP diluted net income |
$ | 14,816 | $ | 6,713 | ||||
Non-GAAP net income per share: |
||||||||
Basic |
$ | 0.57 | $ | 0.26 | ||||
Diluted |
$ | 0.54 | $ | 0.23 | ||||
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This website contains forward-looking statements that are subject to the safe harbors created under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business, and can be identified by the fact that they do not relate strictly to historical or current facts. Such forward-looking statements may include words such as "expect," "anticipate," "intend," "believe," "estimate," "plan," "target," "strategy," "continue," "may," "will," "should," variations of such words, or other words and terms of similar meaning. All forward-looking statements reflect our best judgment and are based on several factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Such factors include, but are not limited to, the risks as identified in the "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business" sections of our Annual Report on Form 10-K for our most recent fiscal year, and other risks as identified from time to time in our Securities and Exchange Commission reports. Forward-looking statements are based on information available to us on the date hereof, and we do not have, and expressly disclaim, any obligation to publicly release any updates or any changes in our expectations, or any change in events, conditions, or circumstances on which any forward-looking statement is based. Our actual results and the timing of certain events could differ materially from the forward-looking statements. These forward-looking statements do not reflect the potential impact of any mergers, acquisitions, or other business combinations that had not been completed as of the date of this filing.