EX-99.1 2 a08-12502_1ex99d1.htm EX-99.1

Exhibit 99.1

 

 

Contacts:

 

Jeff Kyle

 

Kristyn Hutzell

Vice President—Finance, Treasurer and CFO

 

Avalon Investor Relations

(805) 987-8741

 

(512) 514-6046

 

POWER-ONE ANNOUNCES FIRST QUARTER RESULTS

 

·            First quarter 2008 revenue of $117.8 million, EPS loss of $0.16

·            90-day backlog of $109 million entering second quarter

·            Company implementing actions to improve operational efficiencies

 

Camarillo, CA, April 24, 2008 – Power-One, Inc. (NASDAQ: PWER), a leading provider of power conversion and power management solutions, today announced that for the first quarter ended March 30, 2008, net sales were $117.8 million, a decline of 5.0% from $124.0 million in the first quarter of 2007.  Net loss was $0.16 per share compared to a net loss of $0.14 per share for the same period last year.  Consistent with the Company’s announcement on April 10th, revenue and earnings for the quarter were below the Company’s guidance primarily due to the Company’s inability to deliver product on time to its customers.

 

Bookings of $155.1 million in the first quarter of 2008 increased 24.6% over bookings of $124.5 million in the first quarter of 2007.  Bookings were strong due to healthy demand, and included the ramp-up of volumes for several new customer programs in high-growth markets.  The Company ended the first quarter of 2008 with approximately $133 million in 180-day backlog and $109 million in 90-day backlog.

 

For the first quarter of 2008, gross margin was 18.1% compared to gross margin of 19.3% in the first quarter of 2007.  The gross margin was affected primarily by manufacturing planning inefficiencies and supply chain constraints that had a negative impact on both revenues and cost-of-goods-sold.

 

Selling, General and Administration expenses were relatively flat at $20.2 million versus $20.5 million in the first quarter of 2007.  SG&A included one-time expenses totaling approximately $1.9 million for severance costs, legal fees, and fees related to extending the Company’s $50 million debt obligation.

 


 

Net loss was $13.6 million compared to $12.3 million in the first quarter of 2007.

 

Richard Thompson, CEO, commented, “Although we continued to face challenges associated with manufacturing inefficiencies and supply chain issues during the first quarter, we are working to improve these areas and move towards profitability.  As evidenced by our strong bookings and backlog, we are seeing increased customer demand across many segments of the business, particularly in our custom products and our renewable energy and other high-growth markets.”

 

Mr. Thompson continued, “As we outlined in our announcement on April 10th, the Company has undertaken a detailed planning process to improve operational performance and drive long-term growth and profitability.  We have already launched initiatives to accelerate the transfer of manufacturing to lower-cost areas and are implementing new sales and operations planning processes that are expected to yield a number of supply chain efficiencies.  The Company expects these steps to improve on-time delivery and lower manufacturing and materials costs.  We believe these measures will result in improved financial performance beginning in the second quarter of 2008 and accelerating into the third quarter.  Other goals of our programs are to heighten our focus on high-growth, higher-margin markets like renewable energy and products sold through distribution and to improve working capital.”

 

Business Outlook

 

For the second quarter of 2008, the Company anticipates that net sales will be in the range of $130 to $135 million.  Net loss is expected to be in the range of $0.05 to $0.08 per share in the second quarter.

 

For full-year 2008, the Company estimates year-over-year revenue growth will be in the range of 8%-10%, which would represent nearly double the projected growth rate of the power supply industry.  The Company expects its initiatives to benefit gross margin, reduce operating expenses, and lead to a profitable second half of 2008. The net loss for 2008 is expected to be in the range of $12 to $20 million.

 

Earnings Conference Call

 

Power-One will be holding a conference call with investors and analysts on Thursday, April 24, 2008 at 2:00 p.m. PT.  The call will be available over the Internet through the Company’s investor relations Web site at www.power-one.com.   To listen to the call, please go to the Web site at least 10 minutes early to register, download, and install any necessary audio software.  For

 


 

those who cannot listen to the live broadcast, the webcast will be available on the investor relations section of the Company’s Web site at www.power-one.com throughout the current quarter.

 

About Power-One

 

Power-One designs and manufactures energy-efficient power conversion and power management solutions for alternative/renewable energy, routers, data storage and servers, wireless communications, optical networking, medical diagnostics, military, railway controls, semiconductor test equipment, and custom applications.  Power-One, with headquarters in Camarillo, CA, has global sales offices, manufacturing, and R&D operations in Asia, Europe, and the Americas.  Please visit www.power-one.com for more information.

 

For information on Power-One and its products, visit the Company’s Web site at www.power-one.com.

 

Statements made in this press release which state the Company’s or management’s intentions, beliefs, expectations or predictions for the future are forward-looking statements. It is important to note that actual results could differ materially from those discussed in such forward-looking statements. Important factors that could cause actual results to differ materially include, but are not limited to;  the Company’s ability to improve its operational efficiencies; the Company’s success in securing improvements and improving efficiencies in its supply chain;  the timing and results achieved in completing product manufacturing transitions to Company facilities in China or other low-cost locations; the Company’s ability to secure market share in higher margin, high-growth markets; the market growth of product sectors targeted by the Company as sectors of focus; and the Company’s ability to increase working capital.  Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company’s SEC filings, which may be obtained by contacting the Company or the SEC. These filings are also available through the Company’s web site at http://www.power-one.com or through the SEC’s Electronic Data Gathering and Analysis Retrieval System (EDGAR) at http://www.sec.gov. We undertake no obligation to publicly update or revise any forward-looking statement.

 

###

 


 

POWER-ONE, INC.

CONSOLIDATED STATEMENT OF OPERATIONS

(In thousands, except per share data)

(UNAUDITED)

 

 

 

Three Months Ended

 

 

 

March 30,

 

March 31,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

NET SALES

 

$

117,758

 

$

124,021

 

COST OF GOODS SOLD

 

96,432

 

100,104

 

GROSS PROFIT

 

21,326

 

23,917

 

 

 

 

 

 

 

EXPENSES:

 

 

 

 

 

Selling, general and administrative

 

20,214

 

20,514

 

Engineering and quality assurance

 

12,028

 

12,561

 

Amortization of intangibles

 

868

 

1,409

 

Total expenses

 

33,110

 

34,484

 

 

 

 

 

 

 

INCOME (LOSS) FROM OPERATIONS

 

(11,784

)

(10,567

)

 

 

 

 

 

 

INTEREST AND OTHER INCOME (EXPENSE):

 

 

 

 

 

Interest income

 

218

 

400

 

Interest expense

 

(1,971

)

(1,653

)

Other income (expense), net

 

(542

)

293

 

Total interest and other income (expense)

 

(2,295

)

(960

)

 

 

 

 

 

 

INCOME (LOSS) BEFORE INCOME TAXES

 

(14,079

)

(11,527

)

 

 

 

 

 

 

PROVISION (BENEFIT) FOR INCOME TAXES

 

(440

)

783

 

 

 

 

 

 

 

NET INCOME (LOSS)

 

$

(13,639

)

$

(12,310

)

 

 

 

 

 

 

BASIC EARNINGS (LOSS) PER SHARE

 

$

(0.16

)

$

(0.14

)

DILUTED EARNINGS (LOSS) PER SHARE

 

$

(0.16

)

$

(0.14

)

 

 

 

 

 

 

BASIC WEIGHTED AVERAGE SHARES OUTSTANDING (1)

 

87,393

 

86,722

 

DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING (1)

 

87,393

 

86,722

 

 

(1) Basic weighted average shares outstanding (WASO) is utilized for periods with a net loss.  This is due to the fact that diluted WASO would be anti-dilutive for these periods.  Diluted WASO is utilized for periods with net income.

 


 

POWER-ONE, INC.

CONSOLIDATED BALANCE SHEET

(In thousands)

(UNAUDITED)

 

 

 

March 30,

 

December 30,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

Cash and cash equivalents

 

$

20,726

 

$

28,364

 

Investments

 

5,718

 

7,477

 

Accounts receivable:

 

 

 

 

 

Trade (net of allowance)

 

121,270

 

129,984

 

Other

 

6,338

 

5,634

 

Inventories

 

119,720

 

105,930

 

Prepaid expenses and other current assets

 

8,564

 

7,487

 

 

 

 

 

 

 

Total current assets

 

282,336

 

284,876

 

 

 

 

 

 

 

PROPERTY & EQUIPMENT, net

 

65,188

 

62,809

 

INTANGIBLE ASSETS, net

 

86,238

 

82,748

 

OTHER ASSETS

 

2,613

 

1,163

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

436,375

 

$

431,596

 

 

 

 

 

 

 

LIABILITIES & EQUITY

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

Bank credit facilities and notes payable

 

$

27,176

 

$

21,843

 

Accounts payable

 

106,991

 

107,751

 

Restructuring reserve

 

5,737

 

6,726

 

Long-term debt, current portion

 

2,209

 

2,338

 

Other accrued expenses and current liabilities

 

25,285

 

24,410

 

 

 

 

 

 

 

Total current liabilities

 

167,398

 

163,068

 

 

 

 

 

 

 

LONG-TERM DEBT, less current portion

 

50,409

 

50,550

 

OTHER LONG-TERM LIABILITIES

 

18,519

 

18,552

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY:

 

 

 

 

 

Common stock

 

87

 

87

 

Additional paid-in capital

 

616,326

 

615,040

 

Accumulated other comprehensive income

 

53,503

 

40,527

 

Accumulated deficit

 

(469,867

)

(456,228

)

 

 

 

 

 

 

Total stockholders’ equity

 

200,049

 

199,426

 

 

 

 

 

 

 

TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY

 

$

436,375

 

$

431,596

 

 


 

POWER-ONE, INC.

FINANCIAL HIGHLIGHTS

(In thousands, except per share data)

(UNAUDITED)

 

 

 

Three Months Ended

 

 

 

March 30,

 

March 31,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

Orders

 

$

155,095

 

$

124,526

 

 

 

 

 

 

 

Sales

 

$

117,758

 

$

124,021

 

 

 

 

 

 

 

Operating Income (Loss)

 

$

(11,784

)

$

(10,567

)

 

 

 

 

 

 

Net Income (Loss)

 

$

(13,639

)

$

(12,310

)

 

 

 

 

 

 

Basic Earnings (Loss) Per Share (1)

 

$

(0.16

)

$

(0.14

)

Diluted Earnings (Loss) Per Share (1)

 

$

(0.16

)

$

(0.14

)

 

 

 

 

 

 

Basic Weighted Average Shares Outstanding (1)

 

87,393

 

86,722

 

Diluted Weighted Average Shares Outstanding (1)

 

87,393

 

86,722

 

 

(1) Basic weighted average shares outstanding (WASO) is utilized for periods with a net loss.  This is due to the fact that diluted WASO would be anti-dilutive for these periods.  Diluted WASO is utilized for periods with net income.