Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

---

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): July 31, 2003

SYNAPTICS INCORPORATED

---

Delaware		000-49602		77-0118518
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

2381 BERING DRIVE SAN JOSE, CALIFORNIA		95131
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (408) 434-0110

 

---

	Item 12. Results of Operations and Financial Condition
SIGNATURES
EX-99.1

---

Table of Contents

Item 12. Results of Operations and Financial Condition

     The Company is furnishing this Report on Form 8-K in connection with the disclosure of textual information, in the form of a press release released on July 31, 2003.

     The information in this Report on Form 8-K (including the exhibit) is furnished pursuant to Item 12 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 Company does not have, and expressly disclaims, any obligation to release publicly any updates or any changes in the Company’s expectations or any change in events, conditions, or circumstances on which any forward-looking statement is based.

     The text included with this Report is available on our website located at www.synaptics.com, although we reserve the right to discontinue that availability at any time.

Exhibit 99.1 Press Release dated July 31, 2003.

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 (Registrant)
Date: July 31, 2003		By:   Name: Title:		/s/ Russ J. Knittel Russ J. Knittel Senior Vice President, Chief Financial Officer, Chief Administrative Officer, Secretary, and Treasurer

 

 

Exhibit 99.1

		For more information contact:
		Russ Knittel Synaptics Incorporated 408-434-0110x140 russk@synaptics.com		Jennifer Jarman the blueshirt group 415-217-7722 jennifer@blueshirtgroup.com

Synaptics Reports Fourth Quarter and Fiscal 2003 Financial Results

July 31, 2003 – San Jose, CA – Synaptics (Nasdaq: SYNA), a leader in touch pads and other human interface solutions for mobile computing and communications devices, today reported financial results for the fourth quarter and fiscal year ended June 30, 2003.

Net revenue for the fourth quarter of fiscal 2003 was $28.2 million, a 9% increase compared to $25.8 million for the fourth quarter of the prior fiscal year. Actual (GAAP) net income for the fourth quarter of fiscal 2003 was $2.6 million, or $0.10 per diluted share, unchanged from the comparable quarter last year.

Pro forma net income for the fourth fiscal quarter, excluding non-cash charges related to the amortization of intangibles and deferred stock-based compensation, was $2.7 million, or $0.11 per diluted share. This compares to pro forma net income of $2.7 million, or $0.10 per diluted share, for the fourth quarter of the prior fiscal year.

Net revenue for the year ended June 30, 2003 was $100.7 million compared to net revenue of $100.2 million for the prior fiscal year. GAAP net income for the year ended June 30, 2003 was $7.7 million, or $0.31 per diluted share. This compares to GAAP net income of $9.4 million, or $0.42 per diluted share, for the prior fiscal year.

Pro forma net income, excluding non-cash charges related to the amortization of intangibles and deferred stock-based compensation, was $8.3 million, or $0.33 per diluted share, for fiscal year 2003 compared to pro forma net income of $10.0 million, or $0.44 per diluted share, for the prior fiscal year.

“We are pleased with the Company’s performance in fiscal 2003, posting solid revenues and profitability during a period of challenging market conditions,” stated Francis Lee, President and Chief Executive Officer of Synaptics. “We maintained our market leadership within the notebook segment and saw our new market initiatives begin to pay off as we grew non-notebook revenue to nearly 7% of total revenue from less than 2% in the prior year. Design activity remains strong in both areas, and as we enter fiscal 2004 we look forward to continued progress in diversifying our business.”

Russ Knittel, Synaptics’ Chief Financial Officer, added, “Our fourth quarter revenue grew 8% sequentially, ahead of our expectations, driven by higher revenue from our new market areas. While our backlog remains strong, we continue to see a product mix shift in our notebook business towards single pointing solutions, reflecting a highly competitive environment for dual pointing applications and softness in corporate IT spending. This, in addition to coming off a stronger than expected June

 

---

 

quarter, leads us to forecast a nominal revenue increase of up to 1% in the September quarter. We believe these trends will continue over the near-term and therefore anticipate similar results in the December quarter. We continue to proactively manage our business with an eye towards balancing market share and profitability as we respond to market dynamics.”

About Synaptics Incorporated

Synaptics develops advanced interface solutions for products as diverse as notebook and desktop computers, mobile computing and communications devices, automotive applications, and security solutions. Synaptics’ products include TouchPad™, the industry standard notebook pointing device; ClearPad™, a capacitive touch screen solution; TouchStyk™, a modular and capacitive pointing stick solution; Spiral®, an inductive, proximity sensing pen input system; and QuickStroke®, a proprietary Chinese handwriting recognition software. More information about Synaptics can be found on the World Wide Web at www.synaptics.com.

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’ revenue expectations, earnings expectations, cash flow expectations, and competitive position in both notebook computers and new market initiatives. 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) market demand for Synaptics’ products, (b) market demand for OEMs’ products using Synaptics’ products, (c) the failure of Synaptics’ products and OEMs’ products to deliver commercially acceptable performance, and (d) other risks as identified from time to time in Synaptics’ SEC reports, including Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and the Company’s 10-K for the fiscal year ended June 30, 2002. All forward-looking statements are based on information available to Synaptics on the date hereof, and Synaptics assumes no obligation to update such statements.

Synaptics discloses pro forma or non-GAAP measures of net income and earnings per share. Synaptics believes that this pro forma information provides greater comparability regarding its ongoing operating performance. These measures should not be considered an alternative to measurements required by accounting principles generally accepted in the United States (“U.S. GAAP”), such as net income and earnings per share. These pro forma measures are unlikely to be comparable to pro forma information provided by other companies. In accordance with SEC regulations, reconciliation of the Synaptics U.S. GAAP information to the pro forma information is provided in the table attached. We will also make available on the investor relations page of our web site at www.synaptics.com this press release, a replay of the Webcast, and a reconciliation of the difference between the GAAP and non-GAAP financial measures.

 

---

 

(Tables to Follow)

- 30 -

 

---

 

SYNAPTICS INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)

				June 30,				June 30,
				2003				2002
Assets
Current assets:
	Cash and cash equivalents			$	41,697			$	45,491
	Restricted cash				240				—
	Short term investments				35,589				19,689
	Accounts receivable, net of allowances of $160 and $200 at June 30, 2003 and June 30, 2002, respectively				13,181				13,242
	Inventories				6,428				5,867
	Prepaid expenses and other current assets				3,379				2,964
Total current assets					100,514				87,253
Property and equipment, net					1,934				2,043
Goodwill					1,968				765
Other acquired intangible assets, net					—				40
Other assets					92				280
Total assets				$	104,508			$	90,381
Liabilities and stockholders’ equity
Current liabilities:
	Accounts payable			$	6,893			$	5,867
	Accrued compensation				2,808				2,161
	Accrued warranty				1,002				1,002
	Income taxes payable				1,661				2,646
	Other accrued liabilities				3,362				1,814
	Capital leases and equipment financing obligations				231				445
Total current liabilities					15,957				13,935
Capital leases and equipment financing obligations, net of current portion					28				259
Note payable to a related party					1,500				1,500
Other liabilities					759				684
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; 23,835,877 and 23,182,757 shares issued and outstanding, respectively			24				23
	Additional paid in capital				78,761				75,013
	Deferred stock compensation				(1,184	)			(1,085	)
	Notes receivable from stockholders				(20	)			(876	)
	Retained earnings				8,583				865
	Accumulated other comprehensive income				100				63
Total stockholders’ equity					86,264				74,003
Total liabilities and stockholders’ equity				$	104,508			$	90,381

 

---

 

SYNAPTICS INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)

				Three Months Ended								Twelve Months Ended
				June 30,								June 30,
				2003				2002				2003				2002
Net revenue				$	28,222			$	25,809			$	100,701			$	100,201
Cost of revenue					16,672				14,836				58,417				59,016
Gross margin					11,550				10,973				42,284				41,185
Operating expenses
	Research and development				4,760				4,714				19,837				16,594
	Selling, general, and administrative				2,793				2,422				10,750				9,873
	Amortization of intangible assets				—				30				40				134
	Amortization of deferred stock compensation				136				90				499				453
Total operating expenses					7,689				7,256				31,126				27,054
Operating income					3,861				3,717				11,158				14,131
Interest income					244				290				1,059				522
Interest expense					(34	)			(41	)			(155	)			(197	)
Income before income taxes					4,071				3,966				12,062				14,456
Provision for income taxes					1,467				1,393				4,344				5,056
Net income				$	2,604			$	2,573			$	7,718			$	9,400
Net income per share:
	Basic			$	0.11			$	0.11			$	0.33			$	0.70
	Diluted			$	0.10			$	0.10			$	0.31			$	0.42
Shares used in computing net income per share:
	Basic				23,668				23,179				23,472				13,523
	Diluted				25,902				25,957				25,131				22,544
Pro forma results (unaudited)
	Reported net income			$	2,604			$	2,573			$	7,718			$	9,400
	Pro forma adjustments:
		Amortization of goodwill and other acquired intangible assets			—				30				40				134
		Amortization of deferred stock compensation			136				90				499				453
Pro forma net income				$	2,740			$	2,693			$	8,257			$	9,987
Pro forma earnings per share
		Basic		$	0.12			$	0.12			$	0.35			$	0.74
		Diluted		$	0.11			$	0.10			$	0.33			$	0.44