UNITED STATES

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

April 25, 2013

Date of Report (Date of earliest event reported)

 

 

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)

(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):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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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 April 25, 2013 and attached hereto as Exhibit 99.1.

The information in this Current Report on Form 8-K (including Exhibit 99.1) 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 April 25, 2013, entitled “Synaptics Reports Record Revenue in Third Quarter Fiscal 2013”

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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: April 25, 2013				By:		/s/ Kathleen A. Bayless
						Kathleen A. Bayless
						Senior Vice President, Chief Financial Officer, Secretary, and Treasurer

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EXHIBIT INDEX

 

Exhibit Number		Description
99.1		Press release from Synaptics Incorporated, dated April 25, 2013, entitled “Synaptics Reports Record Revenue in Third Quarter Fiscal 2013”

Exhibit 99.1

 

		For more information contact:   Jennifer Jarman The Blueshirt Group 415-217-5866 jennifer@blueshirtgroup.com

Synaptics Reports Record Revenue in Third Quarter Fiscal 2013

 

•

Revenue up 24% year-over-year, driven by strength of mobile smartphone products

Santa Clara, CA – April 25, 2013 – Synaptics (NASDAQ: SYNA), a leading developer of human interface solutions, today reported financial results for its third quarter ended March 31, 2013.

Net revenue for the third quarter of fiscal 2013 was $163.3 million, an increase of 24% compared with $131.7 million for the comparable quarter last year. Net income for the third quarter of fiscal 2013 was $36.4 million, or $1.07 per diluted share, and reflects the benefit of a non-recurring, non-cash tax item of $15.8 million, compared with net income of $11.4 million, or $0.33 per diluted share, for the comparable quarter last year.

Non-GAAP net income for the third quarter of fiscal 2013 was $27.0 million, or $0.79 per diluted share, compared with non-GAAP net income of $17.9 million, or $0.51 per diluted share, for the third quarter of fiscal 2012. (See attached table for a reconciliation of GAAP to non-GAAP financial measures.)

“We are extremely pleased to report record revenue during the third quarter,” stated Rick Bergman, President and CEO. “The continued adoption of our solutions by a broad base of key customers is a testament to the strength of our technology leadership and has enabled us to diversify our business through increased penetration of the rapidly growing mobile touchscreen market. As the market leader in capacitive touch solutions, we believe Synaptics is well-positioned to drive long-term, profitable growth.”

Third Quarter 2013 Business Metrics

 

•

Revenue mix from mobile and PC products was approximately 64% and 36%, respectively.

 

•

Revenue from mobile products totaled $104.7 million and was up 57.2% year-over-year. Mobile products revenue includes all touchscreen and video display products.

 

•

Revenue from PC products totaled $58.6 million, a decrease of 9.9% year-over-year.

 

•

Gross margin was 49.6%, an increase of 240 basis points year-over-year.

Cash at March 31, 2012 was $315.5 million. Cash flow from operations for the third quarter of fiscal 2013 was $24.7 million.

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Kathy Bayless, CFO, added, “Considering our backlog of approximately $124.0 million, customer forecasts, and the resulting expected product mix, we anticipate revenue to be in the range of $190.0 million to $205.0 million for the June quarter, an increase of 38% to 49% on a year-over-year basis. Our strong June quarter backlog and outlook reflects a steep ramp of new designs across multiple mobile customers.”

Earnings Call Information

The Synaptics third quarter fiscal 2013 teleconference and webcast is scheduled to begin at 2:00 p.m., Pacific Time, on Thursday, April 25, 2013, during which the company will provide forward-looking information. To participate on the live call, analysts and investors should dial 877-941-2068 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

As a leading developer of human interface solutions which enhance the user experience, Synaptics provides the broadest touch solutions portfolio in the industry. The ClearPad™ family supports touchscreen solutions for devices ranging from entry-level mobile phones to flagship premium smartphones, tablets, and notebook PCs. The TouchPad™ family, including ClickPad™ and ForcePad™, is integrated into the majority of today’s notebook PCs. Synaptics’ wide portfolio also includes ThinTouch™, supporting thin and light keyboard solutions, as well as key technologies for next generation touch-enabled video and display applications. (NASDAQ: SYNA) www.synaptics.com

Synaptics, ClearPad, TouchPad, ClickPad, ForcePad, ThinTouch, and the Synaptics logo are trademarks of Synaptics in the United States and/or other countries. All other marks are the property of their respective owners.

Use of Non-GAAP Financial Information

In evaluating its business, Synaptics considers and uses net income excluding share-based compensation and certain non-cash or non-recurring items as a supplemental measure of operating performance. Net income excluding share-based compensation and certain non-cash 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 certain non-cash 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 certain non-cash or non-recurring items. Net income excluding share-based compensation and certain non-cash 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.

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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 belief that the continued adoption of its solutions by a broad base of key customers is a testament to the strength of its technology leadership and has enabled it to diversify its business through increased penetration of the rapidly growing mobile touchscreen market; the company’s belief that it is the market leader in capacitive touch solutions and that it is well positioned to drive long-term, profitable growth; and the company’s anticipated revenue for the June quarter, including its expectation that the June quarter outlook reflects a steep ramp of new designs across multiple mobile customers. 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, 2012. 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)

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SYNAPTICS INCORPORATED

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)

 

		March 31,				June 30,
		2013				2012
Assets
Current assets:
Cash and cash equivalents		$	315,513			$	305,005
Accounts receivables, net of allowances of $567			106,700				104,140
Inventories			43,911				31,667
Prepaid expenses and other current assets			4,873				5,365
Total current assets			470,997				446,177
Property and equipment at cost, net			47,988				24,903
Goodwill			20,695				18,995
Purchased intangibles			13,372				12,800
Non-current auction rate securities			15,801				15,321
Other assets			27,939				23,309
Total assets		$	596,792			$	541,505
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable		$	60,097			$	55,220
Accrued compensation			16,321				12,642
Income taxes payable			11,512				11,221
Other accrued liabilities			34,365				26,515
Total current liabilities			122,295				105,598
Notes payable			2,305				2,305
Other liabilities			17,518				36,812
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; 49,446,155 and 48,680,348 shares issued, and 32,421,623 and 32,896,256 shares outstanding, respectively			49				49
Additional paid in capital			504,440				471,569
Less: 17,024,532 and 15,784,092 treasury shares, respectively, at cost			(445,165	)			(413,885	)
Accumulated other comprehensive income			4,678				1,998
Retained earnings			390,672				337,059
Total stockholders’ equity			454,674				396,790
Total liabilities and stockholders’ equity		$	596,792			$	541,505

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SYNAPTICS INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

 

		Three Months Ended March 31,								Nine Months Ended March 31,
		2013				2012				2013				2012
Net revenue		$	163,324			$	131,705			$	433,405			$	410,621
Cost of revenue			82,241				69,525				222,722				218,458
Gross margin			81,083				62,180				210,683				192,163
Operating expenses
Research and development			36,740				29,415				103,799				87,478
Selling, general, and administrative			20,183				18,031				58,099				52,461
Acquired intangibles amortization			262				—				763				—
Change in contingent consideration			237				—				1,100				—
Total operating expenses			57,422				47,446				163,761				139,939
Operating income			23,661				14,734				46,922				52,224
Interest income			197				231				640				682
Interest expense			(4	)			(4	)			(13	)			(13	)
Impairment recovery on investments			—				46				—				59
Income before (benefit)/provision for income taxes			23,854				15,007				47,549				52,952
(Benefit)/provision for income taxes			(12,592	)			3,561				(6,064	)			11,108
Net income		$	36,446			$	11,446			$	53,613			$	41,844
Net income per share:
Basic		$	1.13			$	0.34			$	1.65			$	1.27
Diluted		$	1.07			$	0.33			$	1.58			$	1.22
Shares used in computing net income per share:
Basic			32,234				33,389				32,552				32,935
Diluted			34,135				35,179				33,843				34,374

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SYNAPTICS INCORPORATED

Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures

(In thousands, except per share data)

(Unaudited)

 

		Three Months Ended								Nine Months Ended
		March 31,								March 31,
		2013				2012				2013				2012
GAAP gross margin		$	81,083			$	62,180			$	210,683			$	192,163
Share-based compensation			249				313				690				903
Non-GAAP gross margin		$	81,332			$	62,493			$	211,373			$	193,066
GAAP gross margin - percentage of revenue			49.6	%			47.2	%			48.6	%			46.8	%
Share-based compensation - percentage of revenue			0.2	%			0.2	%			0.2	%			0.2	%
Non-GAAP gross margin - percentage of revenue			49.8	%			47.4	%			48.8	%			47.0	%
GAAP research and development expense		$	36,740			$	29,415			$	103,799			$	87,478
Share-based compensation			(3,993	)			(3,769	)			(11,783	)			(11,209	)
Non-GAAP research and development expense		$	32,747			$	25,646			$	92,016			$	76,269
GAAP selling, general, and administrative expense		$	20,183			$	18,031			$	58,099			$	52,461
Share-based compensation			(3,991	)			(4,915	)			(12,233	)			(13,551	)
Non-GAAP selling, general, and administrative expense		$	16,192			$	13,116			$	45,866			$	38,910
GAAP operating income		$	23,661			$	14,734			$	46,922			$	52,224
Acquired intangibles amortization			262				—				763				—
Change in contingent consideration			237				—				1,100				—
Share-based compensation			8,233				8,997				24,706				25,663
Non-GAAP operating income		$	32,393			$	23,731			$	73,491			$	77,887
GAAP net income		$	36,446			$	11,446			$	53,613			$	41,844
Impairment recovery on investments			—				(46	)			—				(59	)
Acquired intangibles amortization			262				—				763				—
Change in contingent consideration			237				—				1,100				—
Share-based compensation			8,233				8,997				24,706				25,663
Tax adjustments			(18,168	)			(2,539	)			(22,745	)			(7,419	)
Non-GAAP net income		$	27,010			$	17,858			$	57,437			$	60,029
GAAP net income per share - diluted		$	1.07			$	0.33			$	1.58			$	1.22
Impairment recovery on investments			—				—				—				—
Acquired intangibles amortization			0.01				—				0.02				—
Change in contingent consideration			0.01				—				0.03				—
Share-based compensation			0.24				0.25				0.73				0.75
Tax adjustments			(0.54	)			(0.07	)			(0.66	)			(0.22	)
Non-GAAP net income per share - diluted		$	0.79			$	0.51			$	1.70			$	1.75