Mountain View, Calif. -- February 4, 2010 -- Actel Corporation (NASDAQ: ACTL) today announced net revenues of $49.7 million for the fourth quarter of 2009, down 5.8 percent from the fourth quarter of 2008, and up 5.2 percent from the third quarter of 2009. For the full fiscal year, net revenues were $190.6 million, down 12.7 percent from fiscal 2008.
Actel reported net income in accordance with U.S. generally accepted accounting principles (GAAP) of $1.0 million, or $0.04 per diluted share, for the fourth quarter of 2009 compared with a net loss of $(12.5) million, or $(0.48) per basic share, for the fourth quarter of 2008 and a net income of $0.9 million, or $0.03 per diluted share, for the third quarter of 2009. For the full fiscal year, net loss was $(46.2) million, or $(1.77) per basic share, compared with a net loss of $(11.7) million, or $(0.45) per basic share, in fiscal 2008.
Non-GAAP net income, which excludes stock-based compensation, certain excess inventory reserves, fixed asset impairment charges, expenses associated with the restructuring, adjustments to deferred tax valuation allowances and other non-recurring adjustments, was $3.3 million, or $0.12 per diluted share, for the fourth quarter of 2009 compared with $3.3 million, or $0.13 per diluted share, for the fourth quarter of 2008 and $2.4 million, or $0.09 per diluted share, for the third quarter of 2009. For the full fiscal year, non-GAAP net income was $6.5 million, or $0.25 per diluted share, compared with a net income of $12.0 million, or $0.46 per diluted share, for fiscal 2008.
During the fourth quarter:
- Actel IGLOO® Nano FPGAs were voted the Leading Product in the highly competitive Programmable Logic category of the prestigious 2009 Electronics Design News China (EDNC) Innovation Awards.
- Actel announced several highly configurable DSP IP cores for RTAX DSP FPGAs targeted at the space market. The new cores enable designers to easily create common DSP functions such as filters (FIR, IIR) and transforms (FFT, IFT, DCT).
- Pigeon Point Systems, an Actel company, announced continued compliance and interoperability initiatives for its xTCA™ board and module management controller releases. Formal testing for the recently released Pigeon Point management solutions based on the Actel Fusion® mixed-signal FPGA and the Renesas H8S microcontroller was demonstrated live at the 2009 ATCA Summit xTCA SlotFest.
- Actel IGLOO FPGAs were highlighted in a teardown article in embedded.com about the latest technology in digital cameras, featuring a dual view LCD screen. This confirms that Actel’s low power FPGAs are being designed into the latest portable digital consumer products.
Actel also today announced that John East will retire as President and Chief Executive Officer of the Company and as a member of the Board of Directors. The Board has formed a committee to conduct a search for a new President and Chief Executive Officer (CEO). East will participate in the search, which will include both internal and external candidates. He will remain in his current role until a new CEO is in place, and will then serve as a consultant until August 2, 2011, under the terms of a Transition Agreement that was filed today with the Securities and Exchange Commission.
“I have had the privilege and pleasure of leading Actel for more than two decades, but I’m 65 now and the time has come for me to pass the baton,” said East. “I am proud of the Company, the caliber of our management and employees, the quality of our products and services, and the integrity with which we have conducted business over the years. I am also decidedly optimistic about the Company’s prospects and highly motivated to make a smooth handoff to a superb successor.”
“In accepting John’s decision to retire, the Board is appreciative of his long and distinguished service,” said Robert Spencer, the Company’s Lead Director. “Under John’s stewardship, Actel emerged as the leading supplier of aerospace, low-power, and mixed-signal FPGAs. In addition to John’s acumen, his honesty, fairness, and goodwill have left an indelible imprint on the Company and the industry. We now look forward to a successful transition and the next stage in the Company’s growth.”
Business Outlook – First Quarter 2010
The Company believes that first quarter 2010 revenues will be up two percent to six percent sequentially. Gross margin is expected to be about 62 percent. Operating expenses are anticipated to come in at approximately $27.0 million, which excludes an estimated $2.1 million of stock-based compensation expense and $0.6 million associated with the acquisition of Pigeon Point Systems. Other income is expected to be about $0.5 million. The non-GAAP tax rate for the quarter is expected to be about 30 percent. Outstanding fully diluted share count is expected to be about 26.5 million shares.
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A conference call to discuss fourth quarter results will be held Thursday, February 4, 2010, at 1:30 p.m. Pacific Time. A live web cast and replay of the call will be available. Web cast and replay access information as well as financial and other statistical information can be found on Actel’s web site, www.actel.com. Corporate Restructuring Actel announced in January 2009 a company-wide restructuring plan to increase profitability. In conjunction with cost-reduction initiatives taken in the fourth quarter of 2008, the restructuring is expected to result in a quarterly reduction in expenses of approximately $6.5 million in the third quarter of 2010 compared with the third quarter of 2008. To date, the Company has recorded charges of $5.0 million for severance and other costs related to reductions in force. In addition, the Company has also recorded $5.5 million in restructuring costs not related to reductions in force. The Company expects to record additional charges of approximately $0.5 million by the beginning of the third quarter of 2010, when the restructuring will be substantially complete.
Common Stock Repurchase Program and Rule 10b5-1 Plan
The Company’s stock repurchase program was instituted in 1998 for the purpose of replenishing some or all of the shares of Common Stock issued upon exercise of stock options and in connection with other stock compensation plans. The overall objective of the program is to reduce or eliminate earnings per share dilution caused by the issuance of such additional shares. Repurchases may be made in the open market or in privately negotiated transactions. To date, Actel’s Board of Directors has authorized the repurchase of 7,000,000 shares under the program, and 5,326,258 shares of Common Stock have been repurchased on the open market. The Company has remaining authority to repurchase 1,673,742 shares under the program. To facilitate repurchases under the Company’s stock repurchase program, Actel’s Board of Directors has adopted a plan under Rule 10b5-1 of the Securities and Exchange Commission. Under the Rule 10b5-1 plan, the Company repurchases shares of Actel Common Stock whenever the price and other criteria set forth in the plan are met, including times when the Company would not otherwise be in the market due to the Company’s trading policies or the possession of material non-public information.
Actel is the leader in low-power FPGAs and mixed-signal FPGAs, offering the most comprehensive portfolio of system and power management solutions. Power Matters. Learn more at www.actel.com.