Synaptics Reports Record First Quarter Results SAN JOSE, Calif.,
Oct. 21 /PRNewswire-FirstCall/ -- Synaptics (NASDAQ: SYNA), a
leader in interface solutions for mobile computing, communications,
and entertainment devices, today reported financial results for the
first fiscal quarter ended September 30, 2004. Net revenue for the
first quarter of fiscal 2005 was $38.1 million, an increase of
approximately 29% over the $29.6 million for the first quarter of
fiscal 2004. GAAP net income for the first quarter of fiscal 2005
was $4.4 million, or $0.16 per diluted share. This represents an
increase of approximately 95% compared with GAAP net income of $2.3
million, or $0.09 per diluted share, for the first quarter of
fiscal 2004. "We achieved sequential revenue and net income growth
in the first fiscal quarter of approximately 8% and 19%,
respectively," stated Francis Lee, President and Chief Executive
Officer of Synaptics. "Our performance exceeded our expectations
and was driven by improved gross margins and continued momentum in
the portable digital entertainment market. Revenues from our new
market initiatives grew strongly to 33% of total revenues, the
highest quarterly revenue to date. Design activity remains robust
across our key target markets, and we are excited about our new
solutions for desktop PCs and portable consumer devices as we enter
the holiday period." Russ Knittel, Synaptics' Chief Financial
Officer, added, "Our visibility entering the December quarter is
greatly improved, evidenced by our record backlog of more than $39
million. We are projecting significant sequential revenue growth in
the range of 35% to 45% in the second fiscal quarter primarily
reflecting continued strong demand for portable digital music
players. We expect revenues in the March quarter to be in excess of
the September quarter levels but down sequentially based on
seasonal patterns, the extent of which will depend largely on end
device sell-through in the December quarter." Earnings Call
Information The Synaptics first quarter teleconference and webcast
is scheduled to begin at 2:00 p.m., Pacific Time, on Thursday,
October 21, 2004, during which management may discuss
forward-looking information. To participate on the live call,
analysts and investors should dial 800-218-8862 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
http://www.synaptics.com/ . About Synaptics Incorporated Synaptics
is a leading developer of interface solutions for mobile computing,
communications and entertainment devices, with its products found
in over 50 percent of today's notebook computers. Synaptics'
engineered solutions for device manufacturers include: TouchPad(TM)
the industry standard notebook navigation device; MobileTouch(TM),
a customizable scrolling, input and navigation solution for mobile
handsets; TouchRing(TM), a one dimensional scrolling solution for
MP3 devices; and QuickStroke(R), a proprietary Chinese handwriting
recognition software. More information about Synaptics can be found
on the web at http://www.synaptics.com/. This press release
contains "forward-looking" statements, 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
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 Annual Report on
Form 10-K for the fiscal year ended June 30, 2004. All forward-
looking statements are based on information available to Synaptics
on the date hereof, and Synaptics assumes no obligation to update
such statements. For more information contact: Russ Knittel
Jennifer Jarman Synaptics Incorporated The Blueshirt Group
408-434-0110x140 415-217-7722 SYNAPTICS INCORPORATED CONSOLIDATED
BALANCE SHEETS (In thousands, except share data) September 30, June
30, 2004 2004 (Unaudited) Assets Current assets: Cash and cash
equivalents $59,837 $59,489 Short term investments 37,463 36,810
Accounts receivable, net of allowances of $164 and $130 at
September 30, 2004, and June 30, 2004, respectively 29,462 21,875
Inventories 7,684 6,525 Prepaid expenses and other current assets
3,323 3,083 Total current assets 137,769 127,782 Property and
equipment, net 1,853 1,829 Goodwill 1,927 1,927 Other assets 1,040
1,115 Total assets $142,589 $132,653 Liabilities and Stockholders'
equity Current liabilities: Accounts payable $11,325 $9,220 Accrued
compensation 3,143 4,594 Accrued warranty 596 704 Income taxes
payable 7,102 4,018 Other accrued liabilities 3,296 2,594 Capital
leases and equipment financing obligations -- 28 Total current
liabilities 25,462 21,158 Note payable to a related party 1,500
1,500 Other liabilities 854 855 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; 25,165,274
and 24,987,398 shares issued and outstanding, respectively 25 25
Additional paid in capital 89,353 88,334 Deferred stock
compensation (532) (634) Retained earnings 26,006 21,575
Accumulated other comprehensive loss (79) (160) Total stockholders'
equity 114,773 109,140 Total liabilities and stockholders' equity
$142,589 $132,653 SYNAPTICS INCORPORATED CONSOLIDATED STATEMENTS OF
INCOME (In thousands, except per share and share data) (unaudited)
Three Months Three Months Ended Ended Sept. 30, Sept. 30, 2004 2003
Net revenue $38,091 $29,571 Cost of revenue 20,899 17,426 Gross
margin 17,192 12,145 Operating expenses Research and development
6,043 5,096 Selling, general, and administrative 3,766 3,074
Amortization of deferred stock compensation 102 137 Restructuring
-- 432 Total operating expenses 9,911 8,739 Operating income 7,281
3,406 Interest income 268 226 Interest expense (26) (34) Income
before income taxes 7,523 3,598 Provision for income taxes 3,092
1,331 Net income $4,431 $2,267 Net income per share: Basic $0.18
$0.09 Diluted $0.16 $0.09 Shares used in computing net income per
share: Basic 25,098,648 24,013,482 Diluted 27,693,808 26,526,878
Non-GAAP results (unaudited) Reported net income $4,431 $2,267
Non-GAAP adjustments: Amortization of deferred stock compensation
102 137 Restructuring, net of tax -- 272 Non-GAAP net income $4,533
$2,676 Non-GAAP earnings per share Basic $0.18 $0.11 Diluted $0.16
$0.10 DATASOURCE: Synaptics Incorporated CONTACT: Russ Knittel of
Synaptics Incorporated, +1-408-434-0110, ext. 140, or ; or Jennifer
Jarman of The Blueshirt Group, +1-415-217-7722, or , for Synaptics
Incorporated Web site: http://www.synaptics.com/
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