IXYS Corporation Reports Results for the Fourth Quarter and Fiscal Year Ended March 31, 2015

June 5, 2015 | By Business Wire News

LEIDEN, Netherlands & MILPITAS, Calif.

IXYS Corporation (NASDAQ:IXYS), an international power semiconductor and IC company, today announced financial results for its fourth quarter and fiscal year ended March 31, 2015.

Net revenues for the quarter were $82.9 million versus $89.9 million in net revenues for the same period in the prior fiscal year. Sequentially, March 31, 2015 quarter net revenues were up $1.6 million, or 2.0%, from the $81.3 million in the December 2014 quarter.

For the twelve months ended March 31, 2015, IXYS reported net revenues of $338.8 million, an increase of $2.4 million as compared with net revenues of $336.3 million for the same period in the prior fiscal year.

“The March 2015 results marked another quarter of solid execution for IXYS, with sequential revenue growth and quarter-over-quarter margin improvement. The financial metrics for the year were equally encouraging with improving profitability and cash flow generation, which further validated our margin and sales initiatives,” commented Dr. Nathan Zommer, CEO and Founder of IXYS. “Quarter over quarter, sales have been strong across nearly all product lines. Strategic acquisitions and R&D expenditures bolstered our extensive product platform, reaching more than 3,500 customers worldwide.”

Net income for the quarter ended March 31, 2015 was $7.8 million, or $0.24 per diluted share, an increase of $7.7 million from the March 31, 2014 quarter, with a net income of $132,000, or $0.00 per diluted share.

The March 31, 2015 quarter non-GAAP net income, which excludes the impact of charges for the amortization of acquired intangible assets and stock compensation, was $9.9 million, or $0.30 per diluted share, which was an increase of $6.3 million, as compared to the non-GAAP net income of $3.6 million, or $0.11 per diluted share, for the same period in the prior fiscal year.

Net income for the twelve months ended March 31, 2015 was $23.7 million, or $0.74 per diluted share, as compared to net income of $6.0 million, or $0.19 per diluted share, for the same period in the prior fiscal year.

For the twelve months ended March 31, 2015, non-GAAP net income, which excludes the impact of charges for the amortization of acquired intangible assets and stock compensation, was $32.0 million, or $1.00 per diluted share, as compared to non-GAAP net income of $17.8 million, or $0.56 per diluted share, for the same period in the prior fiscal year.

Gross profit for the quarter ended March 31, 2015 was $25.3 million, or 30.5% of net revenues, as compared to gross profit of $25.4 million, or 28.2% of net revenues, for the same quarter in the prior fiscal year.

Gross profit for the twelve months ended March 31, 2015 was $102.0 million, or 30.1% of net revenues, as compared to gross profit of $100.2 million, or 29.8% of net revenues, for the same period in the prior fiscal year.

Cash and cash equivalents totaled $121.2 million at March 31, 2015, after generating $8.2 million in cash during the quarter.

Adjusted EBITDA, which excludes stock-based compensation expense, were $14.0 million and $52.0 million, respectively, for the quarter and fiscal year ended March 31, 2015.

In the March 2015 quarter, the company declared a $0.035 per share dividend, highlighting the tenth consecutive quarter of dividends.

“Similar to recent revenue trends, we expect modest sales increases in Asia and the U.S. in the coming quarter based on improving economic conditions in those regions. However, Europe remains depressed, and customers are purchasing on short lead times, seemingly reticent to stock inventory,” said Mr. Uzi Sasson, President and Chief Financial Officer of IXYS. “While we are upbeat about future prospects for IXYS, we must be cautious about near-term headwinds related to global macroeconomic conditions. To that end, we expect revenues in the June 2015 quarter to be in line with revenues of the March 2015 quarter.”

Non-GAAP Information

Included above and within the attached schedules are certain non-GAAP financial figures. During the quarter ended March 31, 2015, the company incurred non-cash expenses, including those associated with amortization of intangible assets and stock compensation. Adjusting the net income in the March 31, 2015 quarter and year to exclude the impact of amortization of intangible assets and stock compensation expenses, net of applicable tax at the effective tax rate for the respective periods, results in a financial presentation for the company without the effect of these non-cash charges. Similarly, adjusted EBITDA for the March 31, 2015 quarter and year reflects the exclusion of depreciation and amortization, stock compensation expenses, as well as interest and taxes, and may serve as an indication of the company’s ability to service its debt. Management believes non-GAAP net income, non-GAAP net income per share and adjusted EBITDA are useful measures of operating performance. However, the non-GAAP measures should be considered in addition to, not as a substitute for or superior to, net income and net income per share or other financial measures prepared in accordance with GAAP.

These non-GAAP measures have limitations as analytical tools, and should not be considered in isolation or as substitutes for analysis of our results as reported under GAAP. Other companies in our industry may calculate non-GAAP net income, non-GAAP net income per share and adjusted EBITDA differently than we do, limiting their usefulness as comparative measures.

About IXYS Corporation

Since its founding in Silicon Valley, IXYS Corporation has been developing technology-driven products to improve energy conversion efficiency, generate clean energy, improve automation, and provide advanced products for the medical, transportation, telecommunications and consumer industries. IXYS, with its subsidiaries, is a worldwide pioneer in the development of power semiconductors, solid state relays, high voltage integrated circuits (HVIC), and MCUs that are necessary in conserving energy and in reducing the world’s dependence on fossil fuels.

Diminishing natural resources, demand for renewable energy and environmental directives for energy efficiency represent a significant challenge. IXYS’ power semiconductors and mixed-signal integrated circuits (IC) play a vital role in reducing energy costs and consumption by optimizing the energy efficiency of everyday products. IXYS semiconductors are also key to developments of new medical devices and systems that provide unique solutions in diagnostics and therapy for the leading medical equipment OEMs worldwide. With an end-customer base of over 3,500 telecommunications, transportation, industrial, medical and consumer companies, IXYS is a worldwide recognized provider of advanced semiconductors.

Additional information may be obtained by visiting IXYS’ website at http://www.ixys.com, or by contacting the company directly.

Safe Harbor Statement

The foregoing press release contains forward-looking statements, including those related to expectations for increasing sales in some regions, global macroeconomic conditions, regional economic conditions, purchasing trends and our revenues in the June 2015 quarter. Actual results may vary materially from those contained in the forward-looking statements, due to changes in customer delivery schedules, the cancellation of orders, an unanticipated decline in our business, increased competition, cash flow difficulties, unanticipated technological hurdles, manufacturing challenges, capacity limitations, adverse changes in customer demand, declining economic conditions, increasing product costs or changes in currency exchange rates, among other things. Further information on other factors that could affect IXYS is detailed and included in reports that IXYS has filed with the Securities and Exchange Commission, including its Form 10-Q for the fiscal quarter ended December 31, 2014. IXYS undertakes no obligation to publicly release the results of any revisions to these forward-looking statements.


IXYS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)

	March 31,			March 31,
	2015			2014
ASSETS
Current assets:
Cash and cash equivalents	$	121,164		$	98,438
Restricted cash		266			337
Accounts receivable, net		41,042			45,707
Inventories, net		82,005			93,028
Prepaid expenses and other current assets		3,413			9,520
Deferred income taxes		7,077			7,975
Total current assets		254,967			255,005
Plant and equipment, net		42,545			50,569
Other assets		51,463			53,292
Deferred income taxes		24,880			24,316

Total assets	$	373,855		$	383,182

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Current portion of capitalized lease obligations	$	464		$	2,468
Current portion of notes payable to bank		45,790			1,028
Accounts payable		12,675			15,684
Accrued expenses and other current liabilities		19,865			50,166
Total current liabilities		78,794			69,346
Capitalized lease and other long term obligations, net of current portion		10,528			27,659
Pension liabilities		17,232			15,545
Total liabilities		106,554			112,550

Common stock		381			380
Additional paid-in capital		152,874			147,508
Retained earnings		137,134			117,715
Accumulated other comprehensive (loss) income		(23,088	)		5,029
Stockholders’ equity		267,301			270,632

Total liabilities and stockholders’ equity	$	373,855		$	383,182


IXYS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)

	Three Months Ended					Twelve Months Ended
	March 31,					March 31,
	2015		2014			2015		2014

Net revenues	$	82,926	$	89,895		$	338,767	$	336,330
Cost of goods sold		57,646		64,506			236,802		236,120
Gross profit		25,280		25,389			101,965		100,210
Operating expenses:
Research, development and engineering		6,180		7,850			26,667		30,884
Selling, general and administrative		10,142		11,329			41,810		41,983
Amortization of intangibles		1,433		3,425			5,978		10,521
Total operating expenses		17,755		22,604			74,455		83,388
Operating income		7,525		2,785			27,510		16,822
Other income (expense), net		1,410		(192	)		2,920		(3,363	)
Income before income tax provision		8,935		2,593			30,430		13,459
Provision for income tax		1,139		2,461			6,690		7,413
Net income	$	7,796	$	132		$	23,740	$	6,046

Net income per share – basic	$	0.25	$	0.00		$	0.75	$	0.19

Weighted average shares used in per share calculation – basic		31,663		31,308			31,531		31,146

Net income per share – diluted	$	0.24	$	0.00		$	0.74	$	0.19

Weighted average shares used in per share calculation – diluted		32,413		32,160			32,239		31,916

Reconciliation of net income to Non-GAAP net income (in thousands, unaudited):

	Three Months Ended				Twelve Months Ended
	March 31,				March 31,
	2015		2014		2015		2014

Net income	$	7,796	$	132	$	23,740	$	6,046

Amortization of intangible assets		1,433		3,425		5,978		10,521
Stock compensation expense		646		38		2,237		1,251
Non-GAAP net income	$	9,875	$	3,595	$	31,955	$	17,818


Reconciliation of net income per share, diluted to Non-GAAP net income per share, diluted (unaudited):

	Three Months Ended				Twelve Months Ended
	March 31,				March 31,
	2015		2014		2015		2014

Net income per share, diluted	$	0.24	$	0.00	$	0.74	$	0.19

Amortization of intangible assets		0.04		0.11		0.19		0.33
Stock compensation expense		0.02		0.00		0.07		0.04
Non-GAAP net income per share, diluted	$	0.30	$	0.11	$	1.00	$	0.56

Weighted average shares used in per share calculation, diluted		32,413		32,160		32,239		31,916

Adjusted EBITDA (in thousands, unaduited)

	Three Months Ended				Twelve Months Ended
	March 31,				March 31,
	2015		2014		2015		2014
Net income	$	7,796	$	132	$	23,740	$	6,046

Add:
Income tax expense		1,139		2,461		6,690		7,413
Interest expense		273		427		1,397		1,579
Depreciation and amortization		4,080		6,568		17,311		21,274
Stock employee compensation expense		740		752		2,867		2,785
Adjusted EBITDA	$	14,028	$	10,340	$	52,005	$	39,097