Hittite Microwave Corporation Revises Financial Results For The Fourth Quarter Of 2013

Hittite Microwave Corporation (NASDAQ:HITT) today announced that it revised its financial results for the fourth quarter ended December 31, 2013 to correct an error in its accounting for foreign exchange losses related to an intra-company loan. The impact to the company’s results of operations from the correction of the error was to increase other expense by $0.9 million and to reduce net income by a corresponding amount. Revenue, gross profit and income from operations for the quarter remain unchanged.

Giving effect to the correction, net income for the quarter was $15.6 million, or $0.50 per diluted share, rather than $16.5 million, or $0.53 per diluted share, as previously reported on February 6, 2014. For the full year 2013, the company’s revised net income was $70.0 million, or $2.25 per diluted share, rather than $70.9 million, or $2.28 per diluted share, as previously reported. Revised financial results for the fourth quarter and year ended December 31, 2013 accompany this release.

The error related to a loan by the company to its subsidiary in Norway that is denominated in Norwegian kroner. In its previously reported results, the company had recorded net foreign exchange losses related to this loan as a component of foreign currency translation losses within stockholders’ equity. In preparing to file its Annual Report on Form 10-K for 2013, the company concluded that such net foreign exchange losses should instead have been classified within other expense. The loan has been substantially repaid in the first quarter of 2014, and accounting for the loan is not expected to have a material impact on future financial results.

About Hittite Microwave Corporation

Hittite Microwave Corporation is an innovative designer and manufacturer of high performance integrated circuits, or ICs, modules, subsystems and instrumentation for technically demanding digital, RF, microwave and millimeterwave applications covering DC to 110 GHz. The company’s standard and custom products apply analog, digital and mixed-signal semiconductor technologies, which are used in a wide variety of wireless & wired communication and sensor applications for the automotive, broadband, cellular infrastructure, fiber optic, microwave & millimeterwave communications, military, space and test & measurement markets. The company is headquartered in Chelmsford, Massachusetts.

“Safe Harbor Statement” under the Private Securities Litigation Reform Act of 1995

Statements in this press release regarding Hittite Microwave Corporation that do not relate to historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, any statements regarding our expectations as to future levels of revenue, net income and earnings per share. Readers are cautioned that these forward-looking statements are subject to risks and uncertainties and are only predictions, and actual future events and results may differ materially from these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: the impact of macro-economic conditions on demand for our products; our ability to effectively manage our costs and expenses in response to fluctuations in our growth rate; market acceptance of our new products; our ability to assess accurately our end market requirements; our success in maintaining the business of our significant customers; our ability to keep pace with new semiconductor processes; risks related to our dependence on third-party suppliers; regulatory, operational, financial and political risks inherent in operating internationally; competition within the semiconductor industry; product returns and warranty claims; the possibility that intellectual property claims initiated by or against us could be costly or have adverse outcomes; and other risks and uncertainties that are discussed under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2013, as filed with the Securities and Exchange Commission.
           
Hittite Microwave Corporation
Condensed Consolidated Balance Sheets (unaudited)
(In thousands)
December 31, 2013 December 31, 2012

Assets
Current assets:
Cash and cash equivalents $ 118,600 $ 269,157
Marketable securities 353,947 140,069
Accounts receivable, net 36,186 30,921
Inventories 76,020 65,926
Income taxes receivable 5,991 1,566
Prepaid expenses and other current assets 2,997 2,761
Deferred taxes   13,399   14,988
Total current assets 607,140 525,388
Property and equipment, net 39,433 36,294
Deferred taxes 1,725 709
Other assets   8,190   11,172
Total assets $ 656,488 $ 573,563
 
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 4,971 $ 3,205
Accrued expenses 10,386 12,889
Income taxes payable 193 584
Deferred revenue and customer advances   6,735   4,699
Total current liabilities 22,285 21,377
Long-term income taxes payable 5,839 412
Deferred taxes 232 446
Other liabilities   103   124
Total liabilities 28,459 22,359
Total stockholders' equity   628,029   551,204
Total liabilities and stockholders' equity $ 656,488 $ 573,563

           
Hittite Microwave Corporation
Condensed Consolidated Statements of Operations (unaudited)
(In thousands except per-share data)
Three Months Ended December 31,   Twelve Months Ended December 31,
  2013     2012     2013     2012  
 
Revenue $ 68,775 $ 68,515 $ 273,815 $ 264,395
Cost of revenue   22,502     18,296     79,040     69,415  
Gross profit 46,273 50,219 194,775 194,980
  67.3 %   73.3 %   71.1 %   73.7 %
Operating expenses:
Research and development 11,823 12,449 49,764 49,202
Sales and marketing 6,105 6,319 23,516 23,966
General and administrative   3,364     3,468     13,855     14,598  
Total operating expenses   21,292     22,236     87,135     87,766  
Income from operations 24,981 27,983 107,640 107,214
36.3 % 40.8 % 39.3 % 40.6 %
 
Interest and other income (expense), net   (1,015 )   68     (682 )   57  
Income before income taxes 23,966 28,051 106,958 107,271
Provision for income taxes   8,360     10,337     36,965     38,702  
Net income $ 15,606   $ 17,714   $ 69,993   $ 68,569  
 
Earnings per share:
Basic $ 0.51   $ 0.58   $ 2.29   $ 2.26  
Diluted $ 0.50   $ 0.57   $ 2.25   $ 2.22  
 
Weighted average shares outstanding:
Basic   30,672     30,401     30,609     30,359  
Diluted   31,174     31,003     31,093     30,895  

Copyright Business Wire 2010

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