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
Date of Report (Date of earliest event reported): October 20, 2011
SYNAPTICS INCORPORATED
(Exact name of registrant as specified in its charter)
| DELAWARE | 000-49602 | 77-0118518 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
| 3120 SCOTT BLVD. SANTA CLARA, CALIFORNIA |
95054 |
|
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (408) 454-5100
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:
| 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)) |
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 October 20,
2011.
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 October 20, 2011, entitled “Synaptics Reports First Quarter Fiscal 2012 Results” |
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: October 20, 2011 | By: | /s/ Kathleen A. Bayless | ||
| Kathleen A. Bayless | ||||
| Chief Financial Officer, Secretary, and Treasurer | ||||
EXHIBIT INDEX
| Exhibit | ||
| Number | Description | |
99.1
|
Press release from Synaptics Incorporated, dated October 20, 2011, entitled “Synaptics Reports First Quarter Fiscal 2012 Results” |
Exhibit 99.1
| For more information contact: | ||
|
Jennifer Jarman The Blueshirt Group 415-217-5866 jennifer@blueshirtgroup.com |
Synaptics Reports First Quarter Fiscal 2012 Results
| • | Gross margin expansion drives additional operating leverage | ||
| • | 1.4 million shares of common stock repurchased during the period; additional $100 million approved for stock repurchase program |
Santa Clara, CA — October 20, 2011 — Synaptics (NASDAQ: SYNA), a leading developer of human
interface solutions for mobile computing, communications, and entertainment devices, today reported
financial results for its first fiscal quarter ended September 30, 2011.
Net revenue for the first quarter of fiscal 2012 was $133.4 million compared with $153.2 million
for the comparable quarter last year. Net income for the first quarter of fiscal 2012 was $13.0
million, or $0.39 per diluted share, compared with net income of $18.7 million, or $0.52 per
diluted share, for the comparable quarter last year.
Non-GAAP net income for the first quarter of fiscal 2012 was $19.1 million, or $0.57 per diluted
share, compared with non-GAAP net income of $24.2 million, or $0.67 per diluted share, for the
first quarter of fiscal 2011. (See attached table for a reconciliation of GAAP to non-GAAP
results.)
“We are pleased with our performance in the first quarter considering the macroeconomic conditions
impacting our markets, including further weakening in PC demand and general softness in consumer
spending,” stated Rick Bergman, President and CEO. “As we transition through the anticipated
revenue headwinds over the course of the fiscal year, our business model is benefitting from
additional operating leverage as evidenced by the increase in our gross margin percentage.”
For the first quarter of fiscal 2012, PC revenue of $68.8 million decreased 13% from the comparable
quarter last year, reflecting declines in demand for both consumer notebooks and PC peripherals,
and represented 52% of total revenue. Non-PC revenue of $64.6 million, which consisted almost
entirely of mobile phone touchscreen applications, decreased 13% from the prior year. Mobile units
continued to grow substantially, with revenue impacted by the product mix transition away from
integrated touchscreen modules.
Cash at September 30, 2011 totaled $241.4 million. Cash flow from operations for the first quarter
of fiscal 2012 was $31.1 million, and the company used $33.5 million to repurchase 1.4 million
shares of common stock.
Kathy Bayless, CFO, added, “Considering our backlog of approximately $85.0 million, customer
forecasts, and the resulting expected product mix, we anticipate revenue to be in the range of
$141.0 million to $149.0 million for the 14-week December quarter. We expect both PC and non-PC
revenue to be up sequentially based on seasonal trends. While the product transition away from
mobile phone integrated touchscreen modules is largely complete, the impact will be evident in our
top line comparison, yielding lower revenue year-over-year.”
“Taking into consideration the product mix shift in mobile and the impact of global macroeconomic
trends on our markets, our current outlook for the fiscal year suggests revenue to be down 1% to
6%. However, the mobile product mix shift has resulted in an expanded gross margin and as such, we
anticipate gross profit dollars to be up year-over-year,” concluded Ms. Bayless.
Synaptics’ board of directors approved an additional $100 million for the stock repurchase program,
bringing the remaining authorization to $134.3 million available for the repurchase of company
common stock through October 2013.
Earnings Call Information
The Synaptics first quarter fiscal 2012 teleconference and webcast is scheduled to begin at 2:00
p.m., Pacific Time, on Thursday, October 20, 2011, during which the company will provide
forward-looking information. To participate on the live call, analysts and investors should dial
877-941-1427 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 (NASDAQ: SYNA) is a leading developer of human interface solutions for the mobile
computing, communications, and entertainment industries. The company creates interface solutions
for a variety of devices including notebook PCs, PC peripherals, tablets, and mobile phones. The
TouchPad™, 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
Use of Non-GAAP Financial Information
In evaluating its business, Synaptics considers and uses net income per share excluding share-based
compensation and unusual or non-recurring items as a supplemental measure of operating performance.
Net income excluding share-based compensation and unusual or non-recurring items is not a
measurement of the company’s financial performance under GAAP and should not be considered as an
alternative to GAAP net income. The company presents net income excluding share-based compensation
and unusual or non-recurring items because it considers it an important supplemental measure of its
performance. The company believes this measure facilitates operating performance comparisons from
period to period by eliminating potential differences in net income caused by the existence and
timing of share-based compensation charges and unusual or non-recurring items. Net income excluding
share-based compensation and unusual or non-recurring items has limitations as an analytical tool
and should not be considered in isolation or as a substitute for the company’s GAAP net income.
The principal limitations of this measure are that it does not reflect the company’s actual
expenses and may thus have the effect of inflating its 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 the company’s business model benefitting from additional operating
leverage reflected in the increase in its gross margin percentage as it transitions through
anticipated revenue headwinds over the course of the fiscal year; the company’s anticipated revenue
for the December quarter; the company’s expectations that both PC and non-PC revenue will be up
sequentially based on seasonal trends; the company’s belief that the impact of its product
transition away from integrated touchscreen modules will be evident in its top line comparison,
yielding lower revenue year-over-year; the company’s expectations that annual revenue will be down
for the fiscal year; and the company’s expectation that gross profit dollars will be up
year-over-year as a result of the expanded gross margin from the mobile product mix shift.
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 Synaptics serves, (d) the success of Synaptics’ customers’ products that utilize
Synaptics’ product solutions, (e) the development and launch cycles of Synaptics’ customers’
products, (f) market pressures on selling prices, (g) changes in product mix, (h) the market
acceptance of Synaptics’ product solutions compared with competitors’ solutions, (i) general
economic conditions, including consumer confidence and demand, and (j) 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, 2011. 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)
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
| September 30, | June 30, | |||||||
| 2011 | 2011 | |||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 241,357 | $ | 247,153 | ||||
Receivables, net of allowances of $709 |
95,339 | 93,808 | ||||||
Inventories |
28,795 | 28,850 | ||||||
Prepaid expenses and other current assets |
5,826 | 4,373 | ||||||
Total current assets |
371,317 | 374,184 | ||||||
Property and equipment, net |
26,398 | 26,222 | ||||||
Goodwill |
1,927 | 1,927 | ||||||
Non-current auction rate securities |
23,805 | 25,876 | ||||||
Other assets |
28,093 | 27,992 | ||||||
Total assets |
$ | 451,540 | $ | 456,201 | ||||
Liabilities and stockholders’ equity |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 46,469 | $ | 44,930 | ||||
Accrued compensation |
11,289 | 13,210 | ||||||
Income taxes payable |
15,778 | 11,808 | ||||||
Other accrued liabilities |
28,565 | 22,813 | ||||||
Total current liabilities |
102,101 | 92,761 | ||||||
Convertible senior subordinated notes |
2,305 | 2,305 | ||||||
Other liabilities |
21,890 | 21,142 | ||||||
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; 120,000,000 shares authorized;
46,935,416 and 46,832,208 shares issued,
and 32,177,617 and
33,465,732 shares outstanding, respectively |
47 | 47 | ||||||
Additional paid in capital |
414,304 | 406,653 | ||||||
Less: 14,757,799 and 13,366,476 treasury shares, respectively, at cost |
(385,666 | ) | (352,142 | ) | ||||
Retained earnings |
295,930 | 282,915 | ||||||
Accumulated other comprehensive income |
629 | 2,520 | ||||||
Total stockholders’ equity |
325,244 | 339,993 | ||||||
Total liabilities and stockholders’ equity |
$ | 451,540 | $ | 456,201 | ||||
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, | ||||||||
| 2011 | 2010 | |||||||
Net revenue |
$ | 133,446 | $ | 153,185 | ||||
Cost of revenue (1) |
72,186 | 90,357 | ||||||
Gross margin |
61,260 | 62,828 | ||||||
Operating expenses |
||||||||
Research and development (1) |
28,226 | 24,920 | ||||||
Selling, general, and administrative (1) |
16,709 | 15,548 | ||||||
Total operating expenses |
44,935 | 40,468 | ||||||
Operating income |
16,325 | 22,360 | ||||||
Interest income |
200 | 211 | ||||||
Interest expense |
(4 | ) | (4 | ) | ||||
Impairment recovery on investments |
20 | 10 | ||||||
Income before income taxes |
16,541 | 22,577 | ||||||
Provision for income taxes (2) |
3,526 | 3,878 | ||||||
Net income |
$ | 13,015 | $ | 18,699 | ||||
Net income per share: |
||||||||
Basic |
$ | 0.40 | $ | 0.54 | ||||
Diluted |
$ | 0.39 | $ | 0.52 | ||||
Shares used in computing net income per share: |
||||||||
Basic |
32,875 | 34,402 | ||||||
Diluted |
33,777 | 35,900 | ||||||
(1) Includes share-based compensation charges of: |
||||||||
Cost of revenue |
$ | 315 | $ | 308 | ||||
Research and development |
3,541 | 3,427 | ||||||
Selling, general, and administrative |
4,310 | 4,171 | ||||||
| $ | 8,166 | $ | 7,906 | |||||
(2) Includes tax benefit for share-based compensation charges of: |
||||||||
| $ | 2,015 | $ | 2,363 | |||||
Non-GAAP net income per share: |
||||||||
Basic |
$ | 0.58 | $ | 0.70 | ||||
Diluted |
$ | 0.57 | $ | 0.67 | ||||
SYNAPTICS INCORPORATED
Reconciliation of Non-GAAP Net Income and Net Income Per Share
(In thousands, except per share data)
(Unaudited)
Reconciliation of Non-GAAP Net Income and Net Income Per Share
(In thousands, except per share data)
(Unaudited)
| Three Months Ended | ||||||||
| September 30, | ||||||||
| 2011 | 2010 | |||||||
Reported net income |
$ | 13,015 | $ | 18,699 | ||||
Non-GAAP adjustments (net of tax): |
||||||||
Net gain on investments |
(20 | ) | (10 | ) | ||||
Share-based compensation |
6,151 | 5,543 | ||||||
Non-GAAP basic and diluted net income |
$ | 19,146 | $ | 24,232 | ||||
Non-GAAP net income per share: |
||||||||
Basic |
$ | 0.58 | $ | 0.70 | ||||
Diluted |
$ | 0.57 | $ | 0.67 | ||||
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.