Microsemi Reports Sales and Margins Higher in Q3 and Nabs Major Government Contract
Microsemi Corporation today reported that for its third quarter of fiscal 2013 ended June 30, 2013 net sales were $242.6 million, up 3.1 percent sequentially. GAAP gross margin was 57.0 percent, improving 30 basis points sequentially and 120 basis points over the prior year quarter. GAAP operating margin was 10.4 percent, improving 540 basis points sequentially and 220 basis points over the prior year quarter. GAAP net income for the third quarter of 2013 was $18.3 million or $0.20 per diluted share. Operating cash flow for the quarter was $52.6 million.
For the third quarter of fiscal 2013, non-GAAP gross margin was 57.0 percent, improving 30 basis points sequentially and 80 basis points over the prior year quarter. Non-GAAP operating margin was 22.6 percent, a sequential improvement of 140 basis points. Non-GAAP net income was $44.8 million or $0.49 per diluted share.
"We reported solid results for the June quarter, with increased revenue and improved operating metrics," said James J. Peterson, president and CEO of Microsemi. "Profitability benefited from our continued diligence in executing cost control measures, our operating cash flow for the quarter exceeded $52 million and we saw a number of significant design win successes as customers increasingly rely on Microsemi as their total solution provider. We remain confident our overall strategy continues to bring benefit to our shareholders."
Microsemi expects net sales in the fourth quarter of fiscal year 2013 to increase 2 percent to 4 percent, sequentially, and expects non-GAAP diluted earnings per share of between $0.51 and $0.55. The company also announced it has been awarded a development contract from the U.S. government to deliver a complex SoC solution. The company currently expects the contract to generate revenue immediately and over the next two years.
Microsemi's broad technology capabilities differentiated its offering from a competitive field of many of the industry's leading semiconductor suppliers, with Microsemi receiving top scores in a number of key areas. Leveraging the most comprehensive technology portfolio in the industry, Microsemi has expanded its market opportunity and the company continues to pursue contracts within similar domains.
"This design win validates Microsemi's total solutions initiative," stated Russ Garcia, Microsemi's executive vice president of worldwide marketing. "Microsemi's unique combination of technology and capabilities enabled us to deliver the winning proposal to one of the world's most demanding customers, the U.S. government. As we continue to advance our technology and capabilities portfolio we expect to continue to vigorously participate on platforms in the communications and defense markets."
Microsemi currently expects the initial award of $75 million will contribute to revenues over the next two years.