Exar Reports Continued Revenue Growth and Profitability in Q1 of FY 2014
Exar Corporation reported revenue of $32.6 million in the first quarter of fiscal year 2014 ending June 30, up 5% from the fourth quarter of fiscal year 2013 and 12% from $29.3 million in the same quarter a year ago. Non-GAAP operating income was $4.6 million for the quarter, up $0.3 million from the prior quarter and $3.7 million versus $0.9 million in the same quarter a year ago. Non-GAAP gross margin was 52.3%, compared to 52.7% in the prior quarter and 47.2% in the first quarter of last year. Non-GAAP earnings per fully diluted share were $0.10, compared to $0.10 in the prior quarter and $0.03 in the same quarter of the prior year. On a GAAP basis, net income for the first quarter of fiscal year 2014 was $0.8 million. GAAP gross margin was 47.4% and GAAP net income per fully diluted share was $0.02.
"Our first fiscal quarter results demonstrate continued profitable growth. Revenue grew 5% sequentially and 12% versus the same quarter a year ago. We continue to experience strength in the networking and storage market, which represented 30% of our revenue this quarter, and stability in the broad industrial market, at 51% of revenue, while communications infrastructure contracted slightly to 18%. This growth, coupled with continued strong gross margin and a focus on prudent spending, allowed us to maintain a neutral impact to our earnings per share while we absorbed the acquisition of Altior. On a non-GAAP basis we achieved 14% operating profit and $0.10 earnings per diluted share. With strong earnings and focus on cash management, our free cash flow of $0.8 million was positive for the quarter, despite two significant one-time events that consumed $4.7 million of cash," commented company President and CEO Louis DiNardo.
"Our goal is to build a sustainable growth business and an enduring brand in both our data management and analog mixed-signal businesses. As we closed the quarter and fully integrated Altior to support our presence in Big Data, we concluded a transaction to acquire Cadeka Microcircuits that places us at the center of high-performance analog design and development. The Cadeka products, now our High Performance Analog product line, serve key requirements for precision analog components in the industrial, aerospace and medical electronics markets, as well as high-frequency requirements in video applications for distribution, surveillance and security.
â€œNotably, the Cadeka team has been successful in penetrating the video surveillance and security market by developing technology and products that enable high-fidelity signal transmission over long cables. This technology fills a critical need for the rapidly expanding video distribution, surveillance and security markets. We believe this acquisition, in conjunction with our recently announced $50 million share repurchase program, has us well positioned to achieve consistent profitable growth and to maximize shareholder return," DiNardo concluded
For the second quarter of fiscal year 2014 ending September 29, 2013, the Company expects revenue growth in the range of 5% to 8%. Gross margin on a non-GAAP basis is expected to be in the range of 51% to 53% and non-GAAP net income per fully diluted share is expected to be in the range of $0.09 to $0.11 with Weighted Average Shares Outstanding of approximately 50.0 million.