STMicroelectronics Reports 2012 Second Quarter and First Half Financial Results
(Thomson Reuters ONE) -
PR No. C2686C
STMicroelectronics
Reports 2012 Second Quarter and First Half Financial Results
* Second quarter net revenues up 6.5% sequentially to $2.15 billion
* Second quarter gross margin up 470 basis points sequentially to 34.3%
* ST net financial position $1.15 billion at June 30(th)*
Geneva, July 23, 2012 - STMicroelectronics (NYSE: STM) reported financial
results for the second quarter and first half ended June 30, 2012.
On a sequential basis, second quarter net revenues increased 6.5% to $2.15
billion, gross margin improved to 34.3% and net loss attributable to parent
company decreased to $75 million.
President and CEO Carlo Bozotti commented, "Our second quarter financial results
improved on a sequential basis despite a macro-driven change in customer
sentiment in June. Thanks to broad-based growth and the continued expansion of
our product portfolio into new applications, our second quarter net revenues and
gross margin results were in line with our business outlook. Further, we saw a
significant improvement in our net results, although there remains substantial
progress to be made.
"A critical component of our capability to improve our financial results is ST-
Ericsson. During the quarter, the joint-venture took its first steps in
executing their new strategic plan and showed initial progress on all profit and
loss metrics. In parallel, we are committed to ensure that the VLSI block, our
digital businesses plus ST-Ericsson, becomes self-sustainable and this is one of
our top priorities.
"New product introductions into the fastest growing applications, from energy
management to healthcare and wellness, from trust and data security to smart
consumer devices, are delivering results. During the quarter we ramped
production of a pressure sensor and an iNEMO module containing an integrated
gyroscope and accelerometer for Samsung's latest and most advanced smartphone,
we shipped in volume AMOLED drivers for smartphones, we won key design-wins in
smart power for automotive and for several STM32 32bit microcontrollers in new
fitness applications. We also took an important step towards creating a unified
processing platform thanks to the recently completed transfer of the ST-Ericsson
application processor development team. This will enable us to leverage our
broad system knowledge and customer relationships on a much larger addressable
market."
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((*)) ST net financial position is a non-U.S. GAAP measure. Please refer to
Attachment A for additional information explaining why the Company believes this
measure is important and for reconciliation to U.S. GAAP.
Summary Financial Highlights
+------------------------------------------------+-------+-------+-------+
|U.S. GAAP |Q2 2012|Q1 2012|Q2 2011|
|(In Million US$) | | | |
+------------------------------------------------+-------+-------+-------+
|Net Revenues ((a)) | 2,148 | 2,017 | 2,567 |
+------------------------------------------------+-------+-------+-------+
|Gross Margin | 34.3% | 29.6% | 38.1% |
+------------------------------------------------+-------+-------+-------+
|Operating Income (Loss), as reported | (207) | (352) | 83 |
+------------------------------------------------+-------+-------+-------+
|Net Income (Loss) attributable to parent company| (75) | (176) | 420 |
+------------------------------------------------+-------+-------+-------+
((a)) Net revenues include sales recorded by ST-Ericsson as consolidated by ST
+---------------------------------------------------+-------+-------+-------+
|Non-U.S. GAAP* | | | |
|Before impairment, restructuring and one-time items|Q2 2012|Q1 2012|Q2 2011|
|(In Million US$) | | | |
+---------------------------------------------------+-------+-------+-------+
|Operating Income (Loss) | (151) | (280) | 114 |
+---------------------------------------------------+-------+-------+-------+
|Operating Margin |(7.0%) |(13.9%)| 4.4% |
+---------------------------------------------------+-------+-------+-------+
|Operating Margin - attributable to ST |(1.3%) |(6.5%) | 9.1% |
+---------------------------------------------------+-------+-------+-------+
Second Quarter Review
ST's second quarter net revenues increased 6.5% on a sequential basis, with ST's
wholly-owned businesses posting a sequential increase of 4.4% while the Wireless
product segment grew by about 19%. All regions grew sequentially with Greater
China & South Asia up about 9%, the Americas by about 5%, and EMEA and Japan &
Korea each by approximately 4%.
Second quarter gross margin increased 470 basis points sequentially to 34.3%.
Excluding a one-time charge following an arbitration award in the first quarter
of 2012, gross margin increased 210 basis points sequentially mainly due to a
higher level of saturation, favorable product mix and some favorable currency
effects which started to occur in the later portion of the quarter. Unsaturation
charges in the second quarter were $16 million compared to $71 million in the
first quarter.
Combined SG&A and R&D expenses were $909 million compared to $943 million in the
prior quarter due to efforts to continuously reduce expenses on a quarter by
quarter basis principally driven by ST-Ericsson's ongoing cost-realignment
initiatives. Combined operating expenses, as a percentage of sales, improved to
42.3% in the 2012 second quarter compared to 46.8% in the prior quarter.
Restructuring and impairment charges were $56 million, substantially all of
which are related to ST-Ericsson's cost-realignment initiatives, compared to $18
million in the prior quarter.
Reflecting losses at ST-Ericsson, operating margin before impairment,
restructuring and one-time items attributable to ST improved to negative 1.3% in
the 2012 second quarter compared to negative 6.5% in the prior quarter.*
In the second quarter of 2012, net loss attributable to non-controlling
interests was $160 million, which mainly included the 50% owned by Ericsson in
the ST-Ericsson joint venture, as consolidated by ST. In the first quarter of
2012, the corresponding amount was $159 million.
Second quarter net loss attributable to parent company was $75 million or
$(0.08) per share, compared to a net loss of $(0.20) per share and net income of
$0.46 diluted earnings per share in the prior and year-ago quarters,
respectively. On an adjusted basis, net of related taxes, ST reported a non-U.S.
GAAP net loss per share of $(0.05), excluding impairment, restructuring charges
and one-time items in the second quarter, compared to a net loss of $(0.14) per
share and net income of $0.14 diluted earnings per share in the prior and year-
ago quarters, respectively.*
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((*))Operating income before impairment, restructuring and one-time items,
operating margin before impairment, restructuring and one-time items, operating
margin before impairment, restructuring and one-time items attributable to ST
and adjusted net earnings per share are non-U.S. GAAP measures. For additional
information and reconciliation to U.S. GAAP, please refer to Attachment A.
For the second quarter of 2012, the effective average exchange rate for the
Company was approximately $1.32 to ?1.00 compared to $1.33 to ?1.00 for the
first quarter of 2012 and $1.37 to ?1.00 for the second quarter of 2011.
Net Revenues by Market Segment / Channel
+----------------------------------------------+---------+---------+---------+
| Net Revenues By Market Segment / Channel (*) | Q2 2012 | Q1 2012 | Q2 2011 |
| (Estimated and In %) | | | |
+----------------------------------------------+---------+---------+---------+
| Market Segment / Channel: | | | |
+----------------------------------------------+---------+---------+---------+
| Automotive | 19% | 20% | 17% |
+----------------------------------------------+---------+---------+---------+
| Computer | 13% | 14% | 14% |
+----------------------------------------------+---------+---------+---------+
| Consumer | 10% | 11% | 9% |
+----------------------------------------------+---------+---------+---------+
| Industrial & Other | 9% | 10% | 10% |
+----------------------------------------------+---------+---------+---------+
| Telecom | 27% | 24% | 25% |
+----------------------------------------------+---------+---------+---------+
| Total OEM | 78% | 79% | 75% |
+----------------------------------------------+---------+---------+---------+
| Distribution | 22% | 21% | 25% |
+----------------------------------------------+---------+---------+---------+
((*) )Sales recorded by ST-Ericsson and consolidated by ST are included in
Telecom and Distribution.
On a sequential basis, Telecom led all market segments growing 19%. Consumer
increased about 3%, Industrial & Other up about 2% while Automotive was flat and
Computer decreased by about 7%. Distribution increased 12%.
Revenues and Operating Results by ST Product Segment
Commencing January 1, 2012, the Company began reporting the former ACCI Product
Segment (Automotive/Consumer/Computer/Communication Infrastructure) into the
other segments. The new product segments are Automotive Segment ("APG") and
Digital Sector ("Digital") comprised of the Digital Convergence Group ("DCG")
and Imaging, BiCMOS ASIC and Silicon Photonics Group ("IBP").
+------------------+--------+----------+---------+----------+--------+---------+
|Operating Segment |Q2 2012 | Q2 2012 | Q1 2012 | Q1 2012 |Q2 2011 | Q2 2011 |
| (In Million US$) | Net |Operating | Net |Operating | Net |Operating|
| |Revenues| |Revenues | |Revenues| |
| | | Income | | Income | | Income |
| | | (Loss) | | (Loss) | | (Loss) |
+------------------+--------+----------+---------+----------+--------+---------+
| Automotive (APG) | 404 | 38 | 391 | 37 | 459 | 81 |
+------------------+--------+----------+---------+----------+--------+---------+
| Analog, MEMS & | | | | | | |
| Microcontrollers | 774 | 98 | 758 | 99 | 889 | 166 |
|(AMM) | | | | | | |
+------------------+--------+----------+---------+----------+--------+---------+
| Digital | 353 | (36) | 336 | (38) | 521 | 34 |
+------------------+--------+----------+---------+----------+--------+---------+
| Power Discrete | 262 | 4 | 233 | (6) | 337 | 40 |
|(PDP) | | | | | | |
+------------------+--------+----------+---------+----------+--------+---------+
| Wireless ((a)) | 344 | (240) | 290 | (293) | 347 | (207) |
+------------------+--------+----------+---------+----------+--------+---------+
| Others ((b)(c)) | 11 | (71) | 9 | (151) | 14 | (31) |
+------------------+--------+----------+---------+----------+--------+---------+
| TOTAL | 2,148 | (207) | 2,017 | (352) | 2,567 | 83 |
+------------------+--------+----------+---------+----------+--------+---------+
( (a)) Wireless includes the portion of sales and operating results of ST-
Ericsson as consolidated in the Company's revenues and operating results, as
well as other items affecting operating results related to the wireless
business.
((b)) Net revenues of "Others" includes revenues from sales of Subsystems,
assembly services and other revenues.
((c)) Operating income (loss) of "Others" includes items such as unused capacity
charges, impairment, restructuring charges and other related closure costs,
phase out and start-up costs, NXP arbitration award and other unallocated
expenses such as: strategic or special research and development programs,
certain corporate-level operating expenses, patent claims and litigations, and
other costs that are not allocated to product groups, as well as operating
earnings of the Subsystems and Other Products Group. "Others" includes $16
million, $71 million and $6 million of unused capacity charges in the second and
first quarters of 2012 and second quarter of 2011, respectively; and $56
million, $18 million and $31 million of impairment, restructuring charges and
other related closure costs in the second and first quarters of 2012 and second
quarter of 2011, respectively.
Automotive (APG) second quarter net revenues increased 3.4% sequentially, mainly
driven by market share gains and market improvement in China, Japan and the U.S.
APG second quarter operating margin was 9.4%, stable compared to the prior
quarter.
Analog, MEMS and Microcontrollers (AMM) second quarter net revenues increased
2.2% sequentially driven by analog and microcontroller applications. AMM
operating margin was 12.6% in the 2012 second quarter, compared to 13.1% in the
prior quarter.
Digital second quarter net revenues increased 4.9% sequentially principally due
to higher demand for set-top-box products. Digital operating margin was negative
10.3% in the 2012 second quarter, compared to negative 11.2% in the prior
quarter.
Power Discrete (PDP) second quarter net revenues increased 12.3% sequentially
due to higher demand for Power MOSFET and IGBT. PDP returned to profitability
registering an operating margin of 1.6% in the 2012 second quarter compared to
negative 2.6% in the prior quarter.
Wireless net revenues in the second quarter increased 18.6% compared to the
prior quarter due to a significant ramp of volumes of NovaThor(TM) platforms
shipping to ST-Ericsson's major customers. Wireless operating loss was $240
million in the second quarter, or $113 million after considering non-controlling
interest, compared to a loss of $293 million, or $135 million after considering
non-controlling interest, in the prior quarter.
Our joint venture ST-Ericsson is still in a challenging situation. The company
continues to focus on securing the successful execution and delivery of its
NovaThor ModAps platforms and Thor modems to customers while executing on
company transformation aiming at lowering its break-even point.
For additional information, see ST-Ericsson's Q2 2012 earnings results press
release at www.st.com and at www.stericsson.com
Cash Flow and Balance Sheet Highlights
Free cash flow was negative $129 million in the second quarter mainly due to the
results of ST-Ericsson and the one-time payment of $60 million to NXP following
an arbitration award. In the prior quarter free cash flow was positive $98
million.*
Capital expenditures net of proceeds from sale were $70 million during the
second quarter of 2012 compared to $125 million in the prior quarter.
Inventory decreased by $19 million to $1.49 billion at quarter end.
In the second quarter, dividends paid to shareholders were $89 million. In
addition, the Company paid $6 million to redeem the entire residual outstanding
2016 convertible bonds.
ST continued to maintain a strong net financial position with a net cash
position of $1.15 billion, as adjusted, taking into account the 50% of ST-
Ericsson's debt, at June 30, 2012 compared to $1.17 billion at December
31, 2011. ST's cash and cash equivalents, marketable securities and restricted
cash equaled $2.07 billion and total debt was $1.54 billion, including $619
million of short-term debt by ST-Ericsson to Ericsson, at June 30, 2012.*
Total equity, including non-controlling interest, was $7.01 billion at quarter
end.
In the 2012 second quarter the Company posted a return on net assets (RONA)
attributable to ST of negative 1.7%.*
----------
((*))Free cash flow, net financial position and RONA attributable to ST are non-
U.S. GAAP measures. For additional information and reconciliation to U.S.
GAAP, please refer to Attachment A.
First Half 2012 Results
Net revenues for the first half of 2012 decreased approximately 18% to $4.16
billion from $5.10 billion in the year-ago period mainly due to lower volumes,
including a significant drop in sales at our former largest customer, and much
weaker market conditions.
Gross margin was 32.0% of net revenues, compared to 38.6% of net revenues for
the 2011 first half. The first half 2012 gross margin was negatively impacted by
a one-time $53 million charge to ST's cost of sales due to an arbitration award
and unsaturation charges of $87 million compared to unsaturation charges of $8
million in the prior period. Net income, as reported, was negative $252 million
in the first half of 2012, or ($0.28) per share, compared to a net income of
$590 million, or $0.65 diluted earnings per share in the first half of 2011. On
an adjusted basis, net of related taxes, ST reported a non-U.S. GAAP net loss
per share of ($0.19) excluding impairment, restructuring charges and one-time
items in the first half of 2012 compared to a net income of $0.34 diluted
earnings per share in the first half of 2011.*
The effective average exchange rate for the Company was approximately $1.32 to
?1.00 for the first half of 2012, compared to $1.35 to ?1.00 for the first half
of 2011.
First Half Revenue and Operating Results by Product Segment
+---------------------+-------------+--------------+-------------+-------------+
| Operating Segment | First Half | First Half | First Half | First Half |
| (In Million US$) | 2012 | 2012 | 2011 | 2011 |
| |Net Revenues | Operating |Net Revenues | Operating |
| | |Income (Loss) | |Income (Loss)|
+---------------------+-------------+--------------+-------------+-------------+
| Automotive (APG) | 795 | 75 | 891 | 141 |
+---------------------+-------------+--------------+-------------+-------------+
| Analog, MEMS & | | | | |
|Microcontrollers | 1,532 | 197 | 1,775 | 343 |
|(AMM) | | | | |
+---------------------+-------------+--------------+-------------+-------------+
| Digital | 689 | (74) | 1,009 | 78 |
+---------------------+-------------+--------------+-------------+-------------+
| Power Discrete (PDP)| 494 | (2) | 670 | 90 |
+---------------------+-------------+--------------+-------------+-------------+
| Wireless | 635 | (533) | 731 | (386) |
+---------------------+-------------+--------------+-------------+-------------+
| Others | 20 | (222) | 25 | (65) |
+---------------------+-------------+--------------+-------------+-------------+
| TOTAL | 4,165 | (559) | 5,101 | 201 |
+---------------------+-------------+--------------+-------------+-------------+
Third Quarter 2012 Business Outlook
Mr. Bozotti stated, "As we saw during the end of the second quarter, the global
economic environment has weakened. As a result, bookings in June softened and
remain somewhat volatile.
"Nonetheless, we continue to expect sequential revenue growth and gross margin
improvement with respect to the third quarter, thanks to our new product
momentum, in particular in MEMS, microcontrollers and Power MOSFET & IGBT.
"Looking forward, key operational priorities as we navigate the softness in the
market environment include market share gains in the second half of the year and
careful management of our assets and investments in order to maintain ST's solid
net financial position. In this regard, we are reducing by approximately 25% our
full year 2012 capital expenditures plan to be in the range of $500 to $600
million for 2012.
-----
((*) )Adjusted net earnings per share is a non-U.S. GAAP measure. For additional
information and reconciliation to U.S. GAAP, please refer to Attachment A.
( )"Furthermore, we are focused on delivering continued expense reduction.
Overall, we will become a much leaner company with increased flexibility to
adjust to market conditions and reduce our earnings volatility."
The Company expects third quarter 2012 revenues to grow sequentially in the
range of about +2.5%, plus or minus 3 percentage points. Reflecting a similar
level of utilization at our facilities compared to the second quarter, gross
margin in the third quarter is expected to be about 35.3%, plus or minus 1.5
percentage points.
This outlook is based on an assumed effective currency exchange rate of
approximately $1.27 = ?1.00 for the 2012 third quarter and includes the impact
of existing hedging contracts. The third quarter will close on September
29, 2012.
Recent Corporate Developments
On April 23, ST announced its next step in Multimedia Convergence, focused on
offering a unified processing platform to serve a broad range of multimedia
devices like set-top-boxes, TVs, car infotainment, smartphones and tablets. The
plan includes combining the strengths of ST-Ericsson through a strategic
partnership in which ST is taking on ST-Ericsson's application processor
development R&D activity and licensing back the technology to ST-Ericsson for
integration into their ModAps (competitive integrated modem plus application
processor solutions) for smartphones and tablets. Additionally, the two
companies entered into a commercial agreement that enables ST to offer stand-
alone application processors for multiple applications, including smartphones
and tablets. By consolidating the expertise to master all of the key
technologies necessary to serve the multi-screen society, the strategy vaults ST
into the league of very few companies able to provide complete solutions based
on a unified processing platform that delivers the features required by its
customers and the whole ecosystem. On July 1, ST completed the transfer of the
application processor development organization from ST-Ericsson.
On May 30, ST announced that all the resolutions proposed by the Supervisory
Board were approved at the Company's Annual General Meeting (AGM), which was
held in Amsterdam.
The main resolutions approved by shareholders were:
* The appointment of Ms. Martine Verluyten as a new member of the Supervisory
Board for a three-year term, expiring at the 2015 Annual General Meeting, in
replacement of Mr. Doug Dunn whose mandate has expired;
* Approval of the Company's 2011 accounts reported in accordance with
International Financial Reporting Standards (IFRS); and
* The distribution of a cash dividend of US$0.40 per share, to be paid in four
equal quarterly installments.
On June 11, ST announced that it had secured additional sourcing for its
leading-edge 28nm and 20nm FD-SOI (Fully-Depleted-Silicon-on-Insulator)
technology with GLOBALFOUNDRIES. The technology, developed by ST and already
selected by ST-Ericsson for its future mobile platforms, is ideal for its faster
design and superior power performance, while enabling product-cost and power
reductions.
On July 2, ST announced the publication of the Company's 2011 Sustainability
Report. The report provides comprehensive details of ST's Sustainability
strategy, policies and performance during 2011 and illustrates how ST embeds
sustainability into its business practices to create value for all of its
stakeholders.
Q2 2012 - Product and Technology Highlights
During the quarter, ST made solid progress with important new-product
introductions and significant design wins in its key growth areas, including
energy management & savings, trust & data security, healthcare & wellness and
smart consumer devices.
Automotive
o Collected several design wins in countries around the world for modules that
control car-body applications, such as lighting, door zone, and power
management.
o Awarded a design win for the first automotive audio power amplifier for 24V
commercial vehicles for a major Korean customer.
o Awarded design wins for next-generation transmission and engine management
from major Tier1 manufacturers in Japan and Europe for worldwide car makers.
o ST's Cartesio+ Navigation Processor and AM/FM Tuners ICs have won a design
at Garmin for the factory-installed infotainment system for Suzuki's 2013
American models.
o ST has achieved additional successes in Advanced Driver Assistance Systems,
having established sales relationships with 14 OEMs that have sourced the
computer-vision-based platform. We are now sampling the third generation system-
on-chip. From 2015, the EU new car assessment program ties 4- and 5-star ratings
to Autonomous Emergency Braking (AEB) systems for car-to-car and car to
vulnerable road user crashes, which will drive OEMs to provide AEB as a standard
feature in their cars.
Digital Sector
Digital Convergence
o Earned numerous design wins for MPEG2 in Asia and in India Cable Set Top Box
market and for MPEG4 set-top box worldwide market, including fast adoption of
the new 40nm families in Cable, Terrestrial, Satellite and IPTV.
o Collected an additional important design win for Orly 32nm from a telecom
operator in Asia.
o Earned several designs with key Tier 1 OEMs for TV, teleconferencing and CE
accessory products using the MYSTIQUE product family, the industry's first
DisplayPort 1.2 and HDMI 1.4 converters supporting up to 4Kx2K video formats and
high bit-rate audio.
o Earned a design win for a networking ASIC in 28nm technology from a major
customer.
Imaging, Bi-CMOS, ASIC and Silicon Photonics
o Collected 5 new major business awards for image sensors, camera modules, and
chipsets (sensor/camera + image signal processors) at 3 leading mobile handsets
brands for front-side and back-side illumination image sensors and cameras.
o Awarded design win for new large size CMOS X-Ray sensors for medical
applications at a leading European manufacturer.
Analog, MEMS and Microcontrollers
o Started deployment of STarGRID Power Line Communication SoC for new Smart
Metering programs in China. Won a slot with a major PC OEM for the STM32 in a
keyboard controller.
o Added to healthcare and fitness portfolio of design wins with several more
STM32 design-ins.
o Announced the use of the STM32 in the invisible bicycle helmet invented by
Hövding, a Swedish design house.
o Earned design wins for a system-in-package that includes ST's NFC
contactless interface and tamper-proof Secure Element in a smart meter developed
for China by Wasion, a leading supplier of advanced energy metering products.
o Achieved a win for secure microcontroller for brand protection by a major
Japanese printer manufacturer.
o Ramped production of a pressure sensor and an iNEMO inertial module
containing an integrated gyroscope and accelerometer for Samsung's latest and
most advanced smartphone.
o Began production for accelerometers for top European and Chinese smart-phone
makers.
o Achieved design wins for motion MEMS devices from a leading gaming-system
manufacturer
o Earned first design wins for RF Sub-GHz RF transceiver in security-system
and medical applications.
o Collected significant design wins at major tablet manufacturers for high-
performance analog devices and MEMS microphones. The MEMS microphones were also
included in the approved vendor list from a major US PC maker for a Windows 8
platform.
o Awarded the temperature-sensor socket for an important tablet from a major
US corporation.
Power Discretes
o Earned a design win for high-end LED platform from a key European lighting
player.
o Won sockets for extra-low capacitance protection devices in high-speed
applications with several leading smartphone and consumer electronics
manufacturers.
o Collected multiple design wins in Asia for Power transistors in a broad
range of applications, in the Automotive, Telecom, Computer and Consumer
segments.
o Achieved an important design win in the medical sector for ST's ultra-fast
diodes with a large US-headquartered manufacturer.
ST-Ericsson
o Samsung continues to incorporate the ST-Ericsson NovaThor ModAp platforms
into their award-winning Samsung GALAXY smartphone line with the announcement of
the Samsung GALAXY Beam and Samsung GALAXY Ace 2.
o China Unicom and Yulong are now customers of the NovaThor platform. The
NovaThor U8500 ModAp platform powers the new Coolpad Cheer CP7728.
o The Xperia(TM) go smartphone became the fourth phone this year from Sony
Mobile Communications to leverage the ST-Ericsson NovaThor platform.
o The Shanda Bambook smartphone - the first from the China-based company - is
powered by the ST-Ericsson NovaThor U8500 ModAp solution. It is the first of
several smartphones planned by Shanda to use the ST-Ericsson NovaThor platform.
o Powering two new Panasonic ELUGA devices for the Japan market is the compact
yet power efficient Thor M5780 thin modem.
o A new Sharp AQUOS smartphone is based on the power efficient ST-Ericsson
Thor M5730 and available now in Japan.
Cartesio+, Mystique, STarGRID, iNEMO, STM32 and Orly are trademarks of
STMicroelectronics. Thor and NovaThor are trademarks of ST-Ericsson. All other
trademarks are the property of their respective owners.
Use of Supplemental Non-U.S. GAAP Financial Information
This press release contains supplemental non-U.S. GAAP financial information,
including operating income (loss) before impairment, restructuring and one-time
items, operating margin before impairment, restructuring and one-time items,
operating margin before impairment, restructuring and one-time items
attributable to ST, adjusted net earnings (loss), adjusted net earnings (loss)
per share, free cash flow, RONA attributable to ST, net financial position and
net financial position, adjusted to account for 50% investment in ST-Ericsson.
Readers are cautioned that these measures are unaudited and not prepared in
accordance with U.S. GAAP and should not be considered as a substitute for U.S.
GAAP financial measures. In addition, such non-U.S. GAAP financial measures may
not be comparable to similarly titled information by other companies.
See Attachment A of this press release for a reconciliation of the Company's
non-U.S. GAAP financial measures to their corresponding U.S. GAAP financial
measures. To compensate for these limitations, the supplemental non-U.S. GAAP
financial information should not be read in isolation, but only in conjunction
with the Company's consolidated financial statements prepared in accordance with
U.S. GAAP.
Forward-looking information
Some of the statements contained in this release that are not historical facts
are statements of future expectations and other forward-looking statements
(within the meaning of Section 27A of the Securities Act of 1933 or Section 21E
of the Securities Exchange Act of 1934, each as amended) that are based on
management's current views and assumptions, and are conditioned upon and also
involve known and unknown risks and uncertainties that could cause actual
results, performance or events to differ materially from those in such
statements due to, among other factors:
* the possible impact of an impairment charge on the carrying value of the ST-
Ericsson investment in our books of approximately $1.6 billion, as well as
on our consolidated results, which is dependent on the successful execution
of ST-Ericsson's new strategic direction plan and its related savings
announced on April 23rd 2012;
* changes in demand in the key application markets and/or from key customers
served by our products, including demand for products where we have achieved
design wins and/or demand for applications where we are targeting growth,
all of which make it extremely difficult to accurately forecast and plan our
future business activities;
* our ability in periods of reduced market demand or visibility to reduce our
expenses as required, as well as our ability to operate our manufacturing
facilities at sufficient levels with existing process technologies to cover
our fixed operating costs;
* our ability, in an intensively competitive environment, to identify and
allocate necessary design resources to successfully develop and secure
customer acceptance for new products meeting their expectations as well as
our ability to achieve our pricing expectations for high-volume supplies of
new products in whose development we have been, or are currently, investing;
* the financial impact of obsolete or excess inventories if actual demand
differs from our expectations as well as the ability of our customers to
successfully compete in the markets they serve using our products;
* our ability to maintain or improve our competiveness especially in light of
the increasing volatility in the foreign exchange markets and, more
particularly, in the U.S. dollar exchange rate as compared to the Euro and
the other major currencies we use for our operations;
* the impact of intellectual property ("IP") claims by our competitors or
other third parties, and our ability to obtain required licenses on
reasonable terms and conditions;
* the outcome of ongoing litigation as well as any new litigation to which we
may become a defendant;
* changes in our overall tax position as a result of changes in tax laws, the
outcome of tax audits or changes in international tax treaties which may
impact are results of operations as well as our ability to accurately
estimate tax credits, benefits, deductions and provisions and to realize
deferred tax assets;
* product warranty or liability claims based on epidemic or delivery failures
or recalls by our customers for a product containing one of our parts;
* availability and costs of raw materials, utilities, third-party
manufacturing services, or other supplies required by our operations; and
* current macro-economic and industry uncertainties, the Eurozone crisis and
other global factors which may result in limited growth or recession in one
or more important regions of the world economy, sovereign default, changes
in the political, social, economic or infrastructure environment, including
as a result of military conflict, social unrest and/or terrorist activities,
as well as natural events such as severe weather, health risks, epidemics,
earthquakes, tsunami, volcano eruptions or other acts of nature in, or
affecting, the countries in which we, our key customers or our suppliers,
operate all of which may in turn also cause unplanned disruptions in our
supply chain and reduced or delayed demand from our customers.
Such forward-looking statements are subject to various risks and uncertainties,
which may cause actual results and performance of our business to differ
materially and adversely from the forward-looking statements. Certain forward-
looking statements can be identified by the use of forward-looking terminology,
such as "believes," "expects," "may," "are expected to," "should," "would be,"
"seeks" or "anticipates" or similar expressions or the negative thereof or other
variations thereof or comparable terminology, or by discussions of strategy,
plans or intentions.
Some of these risk factors are set forth and are discussed in more detail in
"Item 3. Key Information - Risk Factors" included in our Annual Report on Form
20-F for the year ended December 31, 2011, as filed with the SEC on March
5, 2012. Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may vary
materially from those described in this release as anticipated, believed or
expected. We do not intend, and do not assume any obligation, to update any
industry information or forward-looking statements set forth in this release to
reflect subsequent events or circumstances.
STMicroelectronics Conference Call and Webcast Information
On July 24, 2012, the management of STMicroelectronics will conduct a conference
call to discuss the Company's operating performance for the second quarter of
2012.
The conference call will be held at 9:00 a.m. U.S. Eastern Time / 3:00 p.m. CET.
The conference call will be available live via the Internet by accessing
http://investors.st.com. Those accessing the webcast should go to the Web site
at least 15 minutes prior to the call, in order to register, download, and
install any necessary audio software. The webcast will be available until August
3, 2012.
About STMicroelectronics
ST is a global leader in the semiconductor market serving customers across the
spectrum of sense and power technologies and multimedia convergence
applications. From energy management and savings to trust and data security,
from healthcare and wellness to smart consumer devices, in the home, car and
office, at work and at play, ST is found everywhere microelectronics make a
positive and innovative contribution to people's life. By getting more from
technology to get more from life, ST stands for life.augmented.
In 2011, the Company's net revenues were $9.73 billion. Further information on
ST can be found at www.st.com.
(tables attached)
+------------------------------------------------------------------------------+
|STMicroelectronics N.V. |
| |
|Consolidated Statements of Income |
| |
|(in millions of U.S. dollars, except per share data |
|($)) |
| |
| |
| |
| Three Months Ended |
| |
| (Unaudited) (Unaudited)|
| ------------------------+
| June 30, July 2,|
| |
| 2012 2011|
| |
| |
| |
|Net sales 2,140 2,545|
| |
|Other revenues 8 22|
| ------------------------+
| NET REVENUES 2,148 2,567|
| |
|Cost of sales (1,412) (1,590)|
| ------------------------+
| GROSS PROFIT 736 977|
| |
|Selling, general and administrative (292) (316)|
| |
|Research and development (617) (579)|
| |
|Other income and expenses, net 22 32|
| |
|Impairment, restructuring charges and other related (56) (31)|
|closure costs |
| ------------------------+
| Total Operating Expenses (943) (894)|
| ------------------------+
| OPERATING INCOME (LOSS) (207) 83|
| |
|Realized gain on financial assets - 323|
| |
|Interest expense, net (6) (3)|
| |
|Earnings (loss) on equity-method investments (2) (9)|
| |
| INCOME (LOSS) BEFORE INCOME TAXES (215) 394|
| |
| AND NONCONTROLLING INTEREST |
| |
|Income tax expense (20) (83)|
| ------------------------+
| NET INCOME (LOSS) (235) 311|
| |
|Net loss (income) attributable to noncontrolling 160 109|
|interest |
| ------------------------+
| NET INCOME (LOSS) ATTRIBUTABLE TO PARENT COMPANY (75) 420|
| ------------------------+
| |
| |
| EARNINGS (LOSS) PER SHARE (BASIC) ATTRIBUTABLE TO (0.08) 0.48|
|PARENT COMPANY STOCKHOLDERS |
| |
| EARNINGS (LOSS) PER SHARE (DILUTED) ATTRIBUTABLE TO (0.08) 0.46|
|PARENT COMPANY STOCKHOLDERS |
| |
| |
| |
| NUMBER OF WEIGHTED AVERAGE |
| |
| SHARES USED IN CALCULATING |
| |
| DILUTED EARNINGS (LOSS) PER SHARE 886.1 907.0|
+------------------------------------------------------------------------------+
+------------------------------------------------------------------------------+
|STMicroelectronics N.V. |
| |
|Consolidated Statements of Income |
| |
|(in millions of U.S. dollars, except per share data |
|($)) |
| |
| |
| |
| Six Months Ended |
| |
| (Unaudited) (Unaudited)|
| ------------------------+
| June 30, July 2,|
| |
| 2012 2011|
| |
| |
| |
|Net sales 4,150 5,068|
| |
|Other revenues 15 33|
| ------------------------+
| NET REVENUES 4,165 5,101|
| |
|Cost of sales (2,833) (3,134)|
| ------------------------+
| GROSS PROFIT 1,332 1,967|
| |
|Selling, general and administrative (602) (628)|
| |
|Research and development (1,250) (1,141)|
| |
|Other income and expenses, net 35 58|
| |
|Impairment, restructuring charges and other related (74) (55)|
|closure costs |
| ------------------------+
| Total Operating Expenses (1,891) (1,766)|
| ------------------------+
| OPERATING INCOME (LOSS) (559) 201|
| |
|Other-than-temporary impairment charge and realized - 318|
|gain on financial assets |
| |
|Interest expense, net (19) (18)|
| |
|Loss on equity-method investments (9) (15)|
| |
|Gain on financial instruments, net 3 22|
| |
| INCOME (LOSS) BEFORE INCOME TAXES (584) 508|
| |
| AND NONCONTROLLING INTEREST |
| |
|Income tax benefit (expense) 14 (114)|
| ------------------------+
| NET INCOME (LOSS) (570) 394|
| |
|Net loss (income) attributable to noncontrolling 318 196|
|interest |
| ------------------------+
| NET INCOME (LOSS) ATTRIBUTABLE TO PARENT COMPANY (252) 590|
| ------------------------+
| |
| |
| EARNINGS (LOSS) PER SHARE (BASIC) ATTRIBUTABLE TO (0.28) 0.67|
|PARENT COMPANY STOCKHOLDERS |
| |
| EARNINGS (LOSS) PER SHARE (DILUTED) ATTRIBUTABLE TO (0.28) 0.65|
|PARENT COMPANY STOCKHOLDERS |
| |
| |
| |
| NUMBER OF WEIGHTED AVERAGE |
| |
| SHARES USED IN CALCULATING |
| |
| DILUTED EARNINGS (LOSS) PER SHARE 885.5 907.2|
+------------------------------------------------------------------------------+
+------------------------------------------------------------------------------+
|STMicroelectronics N.V. |
| |
|CONSOLIDATED BALANCE SHEETS |
| |
|As at June 30, March 31, December 31,|
| |
|In millions of U.S. dollars 2012 2012 2011 |
| -------------------------------------+
| (Unaudited) (Unaudited) (Audited) |
+------------------------------------------------------------------------------+
|ASSETS |
| |
|Current assets: |
| |
|Cash and cash equivalents 1,806 2,059 1,912|
| |
|Restricted cash - 3 3|
| |
|Marketable securities 259 154 413|
| |
|Trade accounts receivable, net 1,072 971 1,046|
| |
|Inventories, net 1,489 1,508 1,531|
| |
|Deferred tax assets 175 170 141|
| |
|Assets held for sale 20 22 28|
| |
|Other current assets 578 589 506|
| -------------------------------------+
|Total current assets 5,399 5,476 5,580|
| |
|Goodwill 1,054 1,064 1,059|
| |
|Other intangible assets, net 577 608 645|
| |
|Property, plant and equipment, net 3,606 3,826 3,920|
| |
|Non-current deferred tax assets 366 371 332|
| |
|Restricted cash 4 4 5|
| |
|Long-term investments 109 116 121|
| |
|Other non-current assets 432 420 432|
| -------------------------------------+
| 6,148 6,409 6,514|
| |
|Total assets 11,547 11,885 12,094|
| -------------------------------------+
| |
| |
|LIABILITIES AND EQUITY |
| |
|Current liabilities: |
| |
|Bank overdrafts - - 7|
| |
|Short-term debt 1,173 1,076 733|
| |
|Trade accounts payable 965 781 656|
| |
|Other payables and accrued liabilities 958 987 976|
| |
|Dividends payable to stockholders 265 - 88|
| |
|Deferred tax liabilities 1 15 14|
| |
|Accrued income tax 94 94 95|
| -------------------------------------+
|Total current liabilities 3,456 2,953 2,569|
| |
|Long-term debt 362 366 826|
| |
|Post-retirement benefit obligations 414 425 409|
| |
|Long-term deferred tax liabilities 23 22 21|
| |
|Other long-term liabilities 282 275 273|
| -------------------------------------+
| 1,081 1,088 1,529|
| |
|Total liabilities 4,537 4,041 4,098|
| |
|Commitment and contingencies |
| |
|Equity |
| |
|Parent company stockholders' equity |
| |
|Common stock (preferred stock: 1,156 1,156 1,156|
|540,000,000 shares authorized, not |
|issued; common stock: Euro 1.04 nominal |
|value, 1,200,000,000 shares authorized, |
|910,559,805 shares issued, 887,244,257 |
|shares outstanding) |
| |
|Capital surplus 2,547 2,550 2,544|
| |
|Retained earnings 2,874 3,328 3,504|
| |
|Accumulated other comprehensive income 606 837 670|
| |
|Treasury stock (247) (271) (271)|
| -------------------------------------+
|Total parent company stockholders' equity 6,936 7,600 7,603|
| |
|Noncontrolling interest 74 244 393|
| -------------------------------------+
|Total equity 7,010
Unternehmensinformation / Kurzprofil:
Datum: 23.07.2012 - 22:46 Uhr
Sprache: Deutsch
News-ID 167824
Anzahl Zeichen: 65607
contact information:
Town:
Geneva
Kategorie:
Business News
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