NXP Semiconductors announced first quarter sales of USD $1,519 million, a comparable growth of 0.8% on the first quarter of 2007 and a comparable decline of 7.5% over the fourth quarter of 2007, which the company states reflects the continuing softness of the overall market as well as normal seasonal weakness. Adjusted EBITDA in the first quarter was $183 million, the same level as the first quarter of 2007, but down from $349 million in the fourth quarter of 2007. Adjusted EBITA showed a $37 million increase to $41 million this quarter compared to $4 million in the same period last year, which is said to reflect improved gross margin and operational profitability.
Frans van Houten, President and CEO of NXP Semiconductors, commented: "We were able to achieve a sales level in line with our guidance provided, as the result of better than anticipated sales in both the MultiMarket Semiconductors’ and Automotive & Identification businesses. Our cash position has reduced in the first quarter to $519 million. Apart from the payment for GloNav, this reduction is largely caused by changes in working capital, reflecting the seasonal pattern. The continued focus on our Business Renewal strategy is paying off and the cost savings we have already achieved from that strategy have led to an improved gross margin offsetting some of the currency effects on profitability. We continue to strengthen our operations and remain on course to deliver $375 million of cost savings on a run-rate basis by the end of 2008.
"We have maintained our focus on building leadership positions across our business portfolio and are pleased with the three industry consolidation moves we have announced so far this year. The most significant step has been the announcement of our joint venture with STMicroelectronics in the wireless business to create a top 3 player with $3 billion in revenue, and sufficient scale in R&D. This transaction will give us a significant minority stake in an ambitious and exciting joint venture, as well as $1.5 billion in cash enabling us to pursue growth and expansion in our remaining core sectors. Furthermore we announced the creation of a joint venture for can tuners with Thomson Multi Media, and the acquisition of Conexant’s Set-top Box operations, which signals another step to create scale in our digital video activities in Home. Overall the Home business continues to make steady progress, as evidenced by a strong margin improvement, the reduction of operational expenses and the current ramp-up of several Digital TV customers.
"The Automotive & Identification business continues to perform well. The Mobile & Personal business delivered solid growth in an overall weak market. MultiMarket Semiconductors was under pressure but performed reasonably well."
