Synaptics Reports Results for Fourth Quarter and Fiscal 2014

         Synaptics Reports Results for Fourth Quarter and Fiscal 2014

-- Record fiscal 2014 revenue of $948 million up 43%

-- Record June quarter revenue of $315 million up 37% year-over-year and 54%
sequentially

-- Record fourth quarter and fiscal 2014 non-GAAP EPS of $1.46 and $4.25,
respectively

-- Increases stock repurchase authorization to $200 million

PR Newswire

SAN JOSE, Calif., July 31, 2014

SAN JOSE, Calif., July 31, 2014 /PRNewswire/ -- Synaptics (NASDAQ: SYNA), a
leading developer of human interface solutions, today reported financial
results for its fourth quarter and year ended June 30, 2014.

"Synaptics posted a stellar fourth quarter and a phenomenal fiscal year. We
greatly outpaced our growth objectives by extending our leadership in touch
and generating significant contributions from our fingerprint ID business,"
stated Rick Bergman, President and CEO. "We are clearly executing on our key
growth levers with the adoption of our fingerprint authentication platform,
expanding penetration within large touchscreens, growing traction for our
display integrated solutions and continued expansion in China. Our acquisition
of Renesas SP Drivers is progressing as anticipated, and we are excited to
broaden our expertise in mobile display, which we believe will enhance our
ability to continue to deliver and sustain strong, profitable growth."

Net revenue for fiscal 2014 reached a record $947.5 million, an increase of
43% over fiscal 2013. Net income for fiscal 2014 was $46.7 million, or $1.26
per diluted share, and includes an expense for change to contingent
consideration liability of $69.9 million primarily related to the acquisition
of the company's fingerprint ID business, which is performing significantly
above expectations.

Non-GAAP net income for fiscal 2014 increased 48% from the prior year to a
record $157.6 million, or $4.25 per diluted share. (See attached table for a
reconciliation of GAAP to non-GAAP results.)

Net revenue for the fourth quarter of fiscal 2014 grew 37% over the comparable
quarter last year to a record $314.9 million. Net income for the fourth
quarter of fiscal 2014 was $34.5 million, or $0.89 per diluted share, and
includes an expense for change to contingent consideration liability of $13.1
million.

Non-GAAP net income for the fourth quarter of fiscal 2014 grew 16% over the
prior year period to a record $56.8 million, or $1.46 per diluted share. (See
attached table for a reconciliation of GAAP to non-GAAP financial measures.)

Fourth Quarter 2014 Business Metrics

  oRevenue mix from mobile and PC products was approximately 77% and 23%,
    respectively. Fingerprint ID products have been classified according to
    type of device.
  oRevenue from mobile products of$242.9 millionwas up 40% year-over-year.
    Mobile products revenue includes all touchscreen, video display, and
    applicable fingerprint ID products.
  oRevenue from PC products totaled$72.0 million, an increase of 26%
    year-over-year, and includes applicable fingerprint ID products.
  oCash atJune 30, 2014was$447.2 million.

Kathy Bayless, CFO, added, "Our outperformance in the June quarter reflected a
steep initial ramp of new designs. Considering our backlog of $132 million
entering the typically back-end loaded September quarter, customer forecasts
and product sell-in and sell-through timing patterns, and the resulting
expected product mix, we anticipate a record September quarter with revenue in
the range of$275 to $295 million, an increase of 24% to 33% over the prior
year period. We expect the revenue mix from mobile and PC to be similar to
the preceding quarter."

Mr. Bergman added, "As we look ahead to fiscal 2015, we see signs of stability
in the PC market, coupled with strong but moderating growth rates for
smartphones. With continued strength in our core focus areas and fingerprint
ID solutions now successfully incorporated into our platform, we feel
confident that we can achieve another year of very strong annual revenue
growth in the mid-20% range, excluding revenue from our impending acquisition
of Renesas SP Drivers."

During fiscal 2014, Synaptics repurchased approximately 5% of its outstanding
shares, similar to levels repurchased during each of the past several years.
The company also announced that in July, its board of directors increased and
extended the authorization for stock repurchases by $110 million, for a total
current authorization of $200 million available through July 2016.

Earnings Call Information
The Synaptics fourth quarter fiscal 2014 teleconference and webcast is
scheduled to begin at 2:00 p.m., Pacific Time, on Thursday, July 31, 2014,
during which the company will provide forward-looking information. To
participate on the live call, analysts and investors should dial 1-
888-280-4443 (conference ID: 8116033) 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
The leading developer of human interface solutions which enhance the user
experience,Synapticsprovides the broadest 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. LiveFlex®
fingerprint sensor technology enables authentication, mobile payments, and
touch-based navigation for smartphones, tablets, and notebook
computers.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.

Use of Non-GAAP Financial Information
In evaluating its business, Synaptics considers and uses net income excluding
share-based compensation, change in contingent consideration, and certain
non-cash or non-recurring items as a supplemental measure of operating
performance. Net income excluding share-based compensation, change in
contingent consideration, 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, change in contingent consideration,
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, change in contingent
consideration, and certain non-cash or non-recurring items. Net income
excluding share-based compensation, change in contingent consideration
liability, 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.

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 future operating and financial performance, including
revenue and gross margin for the Company's first fiscal quarter of 2015 and
full 2015 fiscal year. Synaptics cautions that these statements are not
guarantees of future performance and are qualified by important factors that
could cause actual results to differ materially from our current
expectations. 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 Synaptics' Annual
Report on Form 10-K for the fiscal year ended June 29, 2013, and subsequent
quarterly and periodic reports, registration statements, amendments and other
reports that we may file from time to time with the SEC and/or make available
on our website. All forward-looking statements are based on information
available to Synaptics on the date hereof, and Synaptics assumes no obligation
to update the forward-looking statements provided, whether as a result of new
information, future events or otherwise.

For more information contact:

Jennifer Jarman
The Blueshirt Group
415-217-5866
jennifer@blueshirtgroup.com

(Tables to Follow)



SYNAPTICS INCORPORATED
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
                                                        June 30,     June 30,
                                                        2014         2013
Assets
Current assets:
 Cash and cash equivalents                              $ 447,205    $ 355,303
 Accounts receivables, net of allowances of $883        195,057      148,454
 Inventories                                            82,311       49,948
 Prepaid expenses and other current assets              17,858       6,715
Total current assets                                    742,431      560,420
Property and equipment at cost, net                     80,849       58,035
Goodwill                                                61,030       20,695
Purchased intangibles                                   82,111       13,110
Non-current auction rate securities                     19,785       16,969
Other assets                                            34,127       22,037
Total assets                                            $ 1,020,333  $ 691,266
Liabilities and stockholders' equity
Current liabilities:
 Accounts payable                                       $ 97,109     $ 83,710
 Accrued compensation                                   30,682       23,728
 Income taxes payable                                   12,538       10,751
 Current portion of contingent consideration            57,388       196
 Other accrued liabilities                              56,691       31,241
Total current liabilities                               254,408      149,626
Notes payable                                           -            2,305
Other liabilities                                       64,768       17,480
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;
     55,911,513 and 50,673,758 shares issued, and
     36,863,802 and
     33,289,826 shares outstanding, respectively        56           51
 Additional paid in capital                             740,282      539,170
 Less: 19,047,711 and 17,383,932 treasury shares,       (530,422)    (460,160)
 respectively, at cost
 Accumulated other comprehensive income                 8,560        6,802
 Retained earnings                                      482,681      435,992
Total stockholders' equity                              701,157      521,855
Total liabilities and stockholders' equity              $ 1,020,333  $ 691,266



SYNAPTICS INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
                                                                       Three Months      Twelve Months
                                                                       Ended             Ended
                                                                       June 30,          June 30,
                                                                       2014     2013     2014     2013
Net revenue           $        $        $        $
                                                                       314,898  230,183  947,539  663,588
Acquisition related costs (1)                                          2,378    -        6,926    -
Cost of revenue                           172,694  115,062  504,533  337,784
Gross margin         139,826  115,121  436,080  325,804
Operating expenses
       Research and development                         56,896   40,900   192,681  144,699
       Selling, general, and administrative                            26,541   21,521   94,244   79,620
       Acquisition related costs (2)                                   17,031   509      76,669   2,372
       Gain on sale of building                                        -        (1,578)  -        (1,578)
Total operating expenses        100,468  61,352   363,594  225,113
Operating income                    39,358   53,769   72,486   100,691
Interest income                                                        253      225      924      865
Non-cash interest income                                               307      194      1,058    194
Interest expense       -        (4)      (9)      (17)
Income before provision for income taxes              39,918   54,184   74,459   101,733
Provision for income taxes                                5,446    8,864    27,770   2,800
Net income                    $        $        $        $
                                                                       34,472  45,320  46,689  98,933
Net income per share:
       Basic     $       $       $       $ 
                                                                       0.95    1.37    1.34    3.03
       Diluted    $       $       $       $ 
                                                                       0.89    1.29    1.26    2.89
Shares used in computing net income per share:
       Basic 36,411   32,979   34,761   32,658
       Diluted   38,817   35,150   37,105   34,239



(1) These acquisition related costs consist primarily of amortization
    associated with certain acquired intangible assets.
    These acquisition related costs consist primarily of changes in contingent
(2) consideration, non-recurring legal and consulting costs associated with
    acquisitions, and amortization associated with certain acquired intangible
    assets.



SYNAPTICS INCORPORATED
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
(In thousands, except per share data)
(Unaudited)
                                       Three Months Ended  Twelve Months Ended
                                       June 30,            June 30,
                                       2014      2013      2014       2013
GAAP gross margin                      $139,826  $115,121  $436,080   $325,804
    Acquisition related costs          2,378     -         6,926      -
    Share-based compensation           298       221       1,142      911
Non-GAAP gross margin                  $142,502  $115,342  $444,148   $326,715
GAAP gross margin - percentage of      44.4%     50.0%     46.0%      49.1%
revenue
    Acquisition related costs -        0.8%      0.0%      0.8%       0.0%
    percentage of revenue
    Share-based compensation -         0.1%      0.1%      0.1%       0.1%
    percentage of revenue
Non-GAAP gross margin - percentage of  45.3%     50.1%     46.9%      49.2%
revenue
GAAP research and development expense  $ 56,896  $ 40,900  $192,681   $144,699
    Share-based compensation           (5,336)   (3,992)   (18,455)   (15,775)
Non-GAAP research and development      $ 51,560  $ 36,908  $174,226   $128,924
expense
GAAP selling, general, and             $ 26,541  $ 21,521  $ 94,244   $ 79,620
administrative expense
    Share-based compensation           (3,788)   (3,291)   (13,264)   (15,524)
Non-GAAP selling, general, and         $ 22,753  $ 18,230  $ 80,980   $ 64,096
administrative expense
GAAP operating income                  $ 39,358  $ 53,769  $ 72,486   $100,691
    Acquisition related costs          19,409    509       83,595     2,372
    Share-based compensation           9,422     7,504     32,861     32,210
    Gain on sale of building           -         (1,578)   -          (1,578)
Non-GAAP operating income              $ 68,189  $ 60,204  $188,942   $133,695
GAAP net income                        $ 34,472  $ 45,320  $ 46,689   $ 98,933
    Acquisition related costs          19,409    509       83,595     2,372
    Share-based compensation           9,422     7,504     32,861     32,210
    Non-cash interest income           (307)     (194)     (1,058)    (194)
    Gain on sale of building           -         (1,578)   -          (1,578)
    Tax adjustments                    (6,189)   (2,620)   (4,506)    (25,365)
Non-GAAP net income                    $ 56,807  $ 48,941  $157,581   $106,378
GAAP net income per share - diluted    $  0.89  $  1.29  $  1.26   $  2.89
    Acquisition related costs          0.50      0.02      2.25       0.07
    Share-based compensation           0.24      0.21      0.89       0.94
    Non-cash interest income           (0.01)    (0.01)    (0.03)     (0.01)
    Gain on sale of building           -         (0.05)    -          (0.05)
    Tax adjustments                    (0.16)    (0.07)    (0.12)     (0.73)
Non-GAAP net income per share -        $  1.46  $  1.39  $  4.25   $  3.11
diluted



SOURCE Synaptics Inc.

Website: http://www.synaptics.com
 
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