Quarterly dividend of $0.25 per share payable on January 21, 2008 OTTAWA, Ontario – November 27, 2007 -
MOSAID Technologies Incorporated (TSX:MSD) today announced financial results for the second quarter of fiscal 2008, ended October 31, 2007.
- Q2 revenues within guidance: $11.5 million
- Q2 pro forma income at top end of guidance: $3.8 million or $0.34 per diluted share
- Maintaining fiscal 2008 full year guidance for revenue and pro forma income
"I am pleased that MOSAID delivered solid financial results for the second quarter, meeting revenue guidance and delivering the top end of the range on pro forma income guidance, despite challenges posed by the rapid appreciation of the Canadian dollar," said John Lindgren, President and Chief Executive Officer, MOSAID. "Moving into the second half of fiscal 2008, we are on plan and confident in achieving our guidance targets for the full year. We are making good progress in our wireless/wireline and semiconductor licensing programs, as we are in various stages of communication and negotiations with more than 50 companies."
Revenues for the second quarter of fiscal 2008 were $11.5 million, compared to $14.8 million in the second quarter of fiscal 2007. Revenues in the second quarter a year ago were higher primarily as a result of a double payment by one licensee and a higher foreign exchange rate.
Pro forma income was $3.8 million or $0.34 per diluted share in the second quarter of fiscal 2008, compared to $6.2 million or $0.55 per diluted share in the same period a year ago. Pro forma income for the second quarter of fiscal 2008 was less than the same period in the prior year primarily due to reduced revenue. Slightly higher operating expenses and reduced net interest income in Q2 fiscal 2008, as compared to the same period in the prior year, also contributed to the reduced pro forma income result. A reconciliation of pro forma income to Canadian generally accepted accounting principles (GAAP) net income is included in the notes to the financial statements accompanying this press release.
GAAP net income for the second quarter of fiscal 2008 was $4.7 million or $0.43 per diluted share, as compared to net income of $4.7 million or $0.42 per diluted share reported in the same quarter last year. For the second quarter of fiscal 2008, GAAP net income significantly exceeded the Company's guidance of $900,000 primarily due to downward revaluation of U.S. dollar denominated liabilities, resulting in a foreign exchange gain.
MOSAID's balance of cash and marketable securities at the end of the second quarter of fiscal 2008 was $56.8 million, compared to $62.5 million at the end of the first quarter of fiscal 2008. During the second quarter, the Company expended $4.5 million of cash to repurchase and cancel 224,000 shares under the normal course issuer bid announced on September 10, 2007, and returned $2.8 million to shareholders in quarterly dividend payments. It is the intention of the Board of Directors to continue the Company's previously announced normal course issuer bid.
Today the Company also announced that it is in active discussions with respect to the potential sale of its Ottawa head office campus, on terms that would allow the Company to remain as a tenant in part of the premises. MOSAID hopes to complete a transaction on these terms, and in the price range of $10.0 million to $12.0 million, before the end of fiscal 2008.
On November 27, 2007, MOSAID Technologies declared a quarterly dividend of $0.25 per share. The dividend, which is an eligible dividend, is payable on January 21, 2008 to shareholders of record as of January 2, 2008.
Management offers the following guidance for the third quarter of fiscal 2008:
- Q3 revenues of $11.5 million to $12.5 million
- Q3 pro forma income of $3.5 million to $4.5 million, or $0.31 to $0.40 per diluted share
MOSAID is maintaining its guidance for fiscal 2008:
- Fiscal 2008 revenues in the range of $55 million
- Fiscal 2008 pro forma income of $20.0 million to $22.0 million, or $1.77 to $1.95 per diluted share
Conference Call and Webcast
Management will hold a conference call and analyst webcast on Tuesday, November 27, 2007 at 5:00 p.m. (EST). Analysts may access the conference call by dialing 1-800-732-9382. The webcast will be live at www.mosaid.com and available on MOSAID's web site for 90 days following the event.
MOSAID Technologies Inc. is one of the world's leading intellectual property companies. MOSAID develops semiconductor memory technology and licenses patented intellectual property in the areas of semiconductors, and wired and wireless communications systems. MOSAID counts many of the world's largest semiconductor companies among its customers. Founded in 1975, MOSAID is based in Ottawa, Ontario. For more information, visit www.mosaid.com.