STMicroelectronics Reports 2013 Second Quarter and First Half Financial Results
(Thomson Reuters ONE) -
PR No. C2728C
STMicroelectronics
Reports 2013 Second Quarter and First Half Financial Results
* Second quarter net revenues $2.05 billion, gross margin 32.8%
* ST revenues excluding Wireless product line increased 6.8% sequentially, in
line with expectations
* Second quarter operating expenses excluding restructuring charges $736
million; down from $808 million and $887 million in the sequential and year-
ago periods, respectively
* ST-Ericsson transaction to close in early August
Geneva, July 22, 2013 - STMicroelectronics (NYSE: STM), a global semiconductor
leader serving customers across the spectrum of electronics applications,
reported financial results for the second quarter and first half ending June
29, 2013.
Second quarter net revenues totaled $2.05 billion and gross margin was 32.8%.
Net loss attributable to ST was $152 million.
"In the second quarter we saw sequential progress towards our objectives of
sales growth, gross margin improvement and expense reduction," said ST President
and CEO Carlo Bozotti.
"Sales were in line with our guidance, despite an accelerated decline of ST-
Ericsson's existing product revenues. Gross margin came in above the midpoint of
our guidance due to manufacturing efficiencies and increased volumes. Our
quarterly operating expense run rate continues to decrease substantially both on
a sequential and year-over-year basis.
"Our strong sequential increase in sales of 6.8%, excluding Wireless product
line, came from growth in several key product areas including Microcontrollers,
Industrial and Power, Automotive and Imaging. These results are due to both the
introduction of new products and the changes we made last year to expand our
geographic and customer coverage, with new major accounts and distributors, with
the latter further increasing as a percentage of sales.
"We again made solid progress towards our quarterly net operating expenses
target range as we exited the second quarter with operating expenses excluding
restructuring charges of $736 million, or $72 million and $151 million lower
than the prior and year-ago quarters."
Summary Financial Highlights
+------------------------------------------------------+-------+-------+-------+
|U.S. GAAP |Q2 2013|Q1 2013|Q2 2012|
|(Million US$) | | | |
+------------------------------------------------------+-------+-------+-------+
|Net Revenues ((a)) | 2,045 | 2,009 | 2,148 |
+------------------------------------------------------+-------+-------+-------+
|Gross Margin | 32.8% | 31.3% | 34.3% |
+------------------------------------------------------+-------+-------+-------+
|Operating Income (Loss), as reported | (107) | (281) | (207) |
+------------------------------------------------------+-------+-------+-------+
|Net Income (Loss) attributable to parent company ((b))| (152) | (171) | (75) |
+------------------------------------------------------+-------+-------+-------+
(a) Net revenues include sales recorded by ST-Ericsson as consolidated by ST
(b) Includes a loss on equity-method investment of $89 million, $13 million and
$2 million in the second and first quarters of 2013 and the second quarter of
2012, respectively
+---------------------------------------------------+-------+-------+-------+
|Non-U.S. GAAP* | | | |
|Before impairment, restructuring and one-time items|Q2 2013|Q1 2013|Q2 2012|
|(Million US$) | | | |
+---------------------------------------------------+-------+-------+-------+
|Operating Income (Loss) | (64) | (180) | (151) |
+---------------------------------------------------+-------+-------+-------+
|Operating Margin |(3.1%) |(8.9%) |(7.0%) |
+---------------------------------------------------+-------+-------+-------+
|Operating Margin - Attributable to ST |(2.6%) |(5.3%) |(1.3%) |
+---------------------------------------------------+-------+-------+-------+
ST-Ericsson Information
As announced on March 18, 2013, ST and Ericsson have agreed to the transfer of
certain ST-Ericsson employees and assets to the respective parent companies and
to the wind-down of the remaining joint venture. The formal transfer of the
parts of ST-Ericsson to the parent companies is expected to be completed in
early August, 2013. As already communicated, from March 2, 2013 and until
completion of the wind-down, Ericsson is taking on the expenses of the LTE Modem
activities, and ST is taking on the existing products and related business as
well as expenses for resources working on ST programs. Both parents are assuming
equal funding of the wind-down activities.
During the first half of 2013, ST funded $145 million under the ST-Ericsson
parent facility. Based upon its latest review, ST estimates its total cash costs
from beginning 2013 thru the end of the JV, including covering its share of ST-
Ericsson's ongoing operations during the transition period and restructuring
costs in ST-Ericsson and ST related to the exit from the JV, at between $300
million and $350 million. This is lower than the previous estimate as a result
of the timely restructuring and the transfer of certain teams to third-party
companies.
ST-Ericsson's net revenues in the second quarter of 2013 decreased 31%
sequentially to $176 million reflecting, as anticipated, the decline of legacy
products.
Second Quarter Review
Net revenues increased 1.8% sequentially and decreased 4.8% on a year-over-year
basis. Greater China & South Asia led all regions with 6.0% sequential revenue
growth while the Americas increased by 5.6% and EMEA increased 5.2%. Japan &
Korea was lower by 12.8% driven by business dynamics at certain key wireless
global accounts.
ST's second quarter revenues, excluding the Wireless product line, increased
6.8% on a sequential basis and 3.6% on a year-over-year basis, reflecting better
than normal seasonality.
Second quarter gross profit was $672 million and gross margin was 32.8%. On a
sequential basis, gross margin improved 150 basis points reflecting lower
unsaturation charges, manufacturing efficiencies and higher volumes partially
offset by price pressure.
-----
(*)Operating income (loss) before impairment, restructuring and one-time items,
operating margin before impairment, restructuring and one-time items and
operating margin before impairment, restructuring and one-time items
attributable to ST are non-U.S. GAAP measures. Please refer to Attachment A for
additional information explaining why the Company believes these measures are
important and reconciliation to U.S. GAAP.
R&D expenses were $453 million representing a sequential decrease of $80 million
or 15%, benefiting principally from the ongoing restructuring initiatives at ST-
Ericsson as well as the charge back to Ericsson of the LTE Modem expenses of
$102 million partially offset by seasonality. R&D expenses declined by 27%
compared to the year-ago period.
SG&A expenses totaled $285 million in the second quarter, and on a sequential
basis, SG&A expenses increased by 2% mainly due to seasonality. SG&A expenses
decreased 2% compared to the year-ago period mainly due to cost-reduction
initiatives.
Impairment, restructuring and other related closure costs for the second quarter
were $43 million compared to $101 million in the prior quarter mainly due to
restructuring initiatives within the ST organization.
Operating margin before impairment, restructuring and one-time items
attributable to ST was a negative 2.6% in the 2013 second quarter compared to
negative 5.3% in the prior quarter.*
In the second quarter of 2013, net loss attributable to non-controlling interest
was $21 million, which mainly included the 50% owned by Ericsson in the ST-
Ericsson joint venture, as consolidated by ST. In the first quarter of 2013, the
corresponding amount was $126 million.
ST recorded in the second quarter a charge of $89 million on equity-method
investments largely due to a one-time non-cash charge of $69 million on ST's
equity value in 3Sun due to impairment charges reported by the 3Sun joint
venture. 3Sun is a joint initiative between Enel Green Power, Sharp and the
Company for the manufacture of thin film photovoltaic panels in Catania, Italy.
Each partner owns a third of the common shares of the entity.
Second quarter net loss was $152 million or $(0.17) per share, compared to a net
loss of $(0.19) and $(0.08) per share in the prior and year-ago quarter,
respectively. On an adjusted basis, net of related taxes, ST reported non-U.S.
GAAP net loss per share of $(0.06) in the second quarter, excluding impairment
and restructuring charges and one-time items, compared to a net loss of $(0.13)
and $(0.05) per share in the prior and year-ago quarter, respectively.*
For the second quarter of 2013, the effective average exchange rate for the
Company was approximately $1.30 to ?1.00 compared to $1.31 to ?1.00 for the
first quarter of 2013 and $1.32 to ?1.00 for the second quarter of 2012.
Net Revenues by Market Channel
+-----------------------------------+---------+---------+---------+
| Net Revenues By Market Channel(%) | Q2 2013 | Q1 2013 | Q2 2012 |
+-----------------------------------+---------+---------+---------+
| Total OEM | 74% | 75% | 78% |
+-----------------------------------+---------+---------+---------+
| Distribution | 26% | 25% | 22% |
+-----------------------------------+---------+---------+---------+
-----
(*)Operating margin before impairment, restructuring and one-time items
attributable to ST and adjusted net earnings per share are non-U.S. GAAP
measures. For additional information and reconciliation to U.S. GAAP, please
refer to Attachment A.
Revenues and Operating Results by ST Product Segment
+-------------+--------+------------+--------+------------+--------+-----------+
| Operating |Q2 2013 | Q2 2013 |Q1 2013 | Q1 2013 |Q2 2012 | Q2 2012 |
| Segment | Net | Operating | Net | Operating | Net | Operating |
|Million US$) |Revenues| Income |Revenues| Income |Revenues| Income |
| | | (Loss) | | (Loss) | | (Loss) |
+-------------+--------+------------+--------+------------+--------+-----------+
|Sense & Power| | | | | | |
|and | | | | | | |
|Automotive | 1,209 | 42 | 1,127 | 58 | 1,156 | 97 |
|Products | | | | | | |
|(SPA) | | | | | | |
+-------------+--------+------------+--------+------------+--------+-----------+
|Embedded | | | | | | |
|Processing | | | | | | |
|Solutions | | | | | | |
|including | 824 | (106) | 867 | (210) | 981 | (233) |
|Wireless | | | | | | |
|product line | | | | | | |
|(EPS)((a)) | | | | | | |
+-------------+--------+------------+--------+------------+--------+-----------+
|Others | 12 | (43) | 15 | (129) | 11 | (71) |
|((b)(c)) | | | | | | |
+-------------+--------+------------+--------+------------+--------+-----------+
|TOTAL | 2,045 | (107) | 2,009 | (281) | 2,148 | (207) |
+-------------+--------+------------+--------+------------+--------+-----------+
( (a)) Embedded Processing Solutions includes the Wireless product line which
includes a 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, 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 $2 million, $24 million and $16 million of
unused capacity charges in the second and first quarters of 2013 and second
quarter of 2012, respectively; and $43 million, $101 million and $56 million of
impairment, restructuring charges and other related closure costs in the second
and first quarters of 2013 and second quarter of 2012, respectively.
Sense & Power and Automotive Products (SPA) second quarter net revenues
increased 7.3% sequentially, mainly driven by Industrial and Power products and
Automotive. SPA revenues increased 4.6% compared to the year-ago quarter driven
by MEMS. SPA operating margin was 3.5% in the 2013 second quarter compared to
5.1% and 8.3% in the prior and year-ago quarter, respectively, with the decrease
principally driven by resources deployed from ST-Ericsson to strengthen R&D
activities and price pressure within the Analog, MEMS and Sensors (AMS) group.
Embedded Processing Solutions (EPS) second quarter net revenues decreased 5.0%
and 16.0% on a sequential and year-over-year basis, respectively, due to a
significant decrease in ST-Ericsson sales and to a lesser extent, Digital
Convergence (DCG). EPS segment operating margin improved to negative 12.8% in
the 2013 second quarter, from negative 24.2% and negative 23.7% in the prior and
year-ago quarter, respectively, mainly due to a significant reduction in
expenses.
Cash Flow and Balance Sheet Highlights
Free cash flow* was negative $134 million in the second quarter, principally
reflecting anticipated cash resources to fund ST-Ericsson, compared to negative
$65 million in the prior quarter.
Capital expenditure payments, net of proceeds from sales, were $121 million
during the second quarter of 2013 compared to $111 million in the prior quarter.
Inventory increased by $30 million to $1.34 billion at quarter end. Inventory in
the second quarter of 2013 was at 4.1 turns or 88 days, substantially flat
compared to the prior quarter.
As expected, ST's net financial position* decreased in the second quarter to a
net cash position of $954 million at June 29, 2013, adjusted by $145 million of
ST-Ericsson's debt to our joint venture partner, compared to $1.1 billion at
March 30, 2013. ST's financial resources equaled $1.77 billion and total debt
was $964 million at June 29, 2013.
-----
(*)Free cash flow and net financial position are non-U.S. GAAP measures. For
additional information and reconciliation to U.S. GAAP, please refer to
Attachment A.
Total equity, including non-controlling interest, was $5.68 billion at quarter
end.
First Half 2013 Results
Net revenues decreased 2.6% to $4.05 billion from $4.16 billion in the year-ago
period mainly reflecting lower ST-Ericsson sales. Net revenues for the first
half of 2013, excluding the Wireless product line, increased 2.5% to $3.62
billion.
Gross margin was 32.1% of net revenues, compared to 32.0% of net revenues for
the 2012 first half. The first half 2013 gross margin was impacted by
unsaturation charges of $26 million compared to $87 million in the year-ago
period. Net loss, as reported, was $322 million in the first half of 2013, or
$(0.36) per share, compared to a net loss of $252 million, or $(0.28) per share
in the first half of 2012. 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 2013, the same as
in the first half of 2012.*
The effective average exchange rate for the Company was approximately $1.30 to
?1.00 for the first half of 2013, compared to $1.32 to ?1.00 for the first half
of 2012.
First Half Revenue and Operating Results by Product Segment
+----------------+--------------+---------------+--------------+---------------+
| Operating | First Half |First Half 2013| First Half |First Half 2012|
| Segment | 2013 | Operating | 2012 | Operating |
|(In Million US$)| Net | Income (Loss) | Net | Income (Loss) |
| | Revenues | | Revenues | |
+----------------+--------------+---------------+--------------+---------------+
|Sense & Power | | | | |
|and Automotive | 2,337 | 99 | 2,263 | 190 |
|Products | | | | |
| (SPA) | | | | |
+----------------+--------------+---------------+--------------+---------------+
|Embedded | | | | |
|Processing | | | | |
|Solutions | | | | |
|including | 1,692 | (316) | 1,882 | (527) |
|Wireless product| | | | |
|line | | | | |
|(EPS) | | | | |
+----------------+--------------+---------------+--------------+---------------+
| Others | 26 | (171) | 20 | (222) |
+----------------+--------------+---------------+--------------+---------------+
| TOTAL | 4,055 | (388) | 4,165 | (559) |
+----------------+--------------+---------------+--------------+---------------+
Third Quarter 2013 Business Outlook
Mr. Bozotti stated, "Macro trends remain uncertain but excluding ST-Ericsson, we
have seen a progressive improvement in bookings in the second quarter, although,
towards the end of the second quarter, we experienced a softening in the
smartphone market also impacting ST products.
"We continue to expect the ramp of key products in MEMS, Automotive,
Microcontrollers and Imaging in the second half of this year, leading to higher
sequential revenue results for both the third and fourth quarters of this year.
"In combination, we expect third quarter net revenues, excluding Wireless
product line, to increase about 3.5% at the midpoint. Including Wireless product
line, we expect overall revenues to be about flat sequentially at the midpoint
of our guidance. We again expect significant reductions in operating expenses in
the third quarter and we are well aligned to achieve our net operating expenses
target range of $600 million to $650 million in the first quarter of 2014.
Furthermore, with the closing of the ST-Ericsson transaction in early August,
the remaining ST-Ericsson activities will be deconsolidated.
-----
* Adjusted net earnings per share is a non-US GAAP measure. For additional
information and reconciliation to U.S. GAAP, please refer to Attachment A.
"As we look ahead, we anticipate progressive improvement in our gross margin.
First, with fab utilization at a more stable and optimal level we plan to
continue to grow our business in our targeted growth drivers. Second, we are
focused on better utilizing and optimizing our technology portfolio. Third, we
are now in a position to more aggressively manage our product mix in order to
prune lower margin products from our portfolio. To successfully achieve this, we
will make gradual structural changes to our manufacturing footprint to ensure
that it matches our needs, complemented by our foundry sourcing. As a result, we
plan to gradually expand 8-inch capacity while winding down certain 6-inch
manufacturing lines in Singapore and Catania, Italy and consolidate our back-end
activities in China to Shenzhen."
"Finally, to support our proprietary R&D activities for CMOS derivative
technology investments, we recently signed an important frame agreement with the
French Government for the 'Nano2017' program."
The Company expects third quarter 2013 revenues to be about flat on a sequential
basis, plus or minus 3.5 percentage points. Gross margin in the third quarter is
expected to be about 33.5%, plus or minus 2.0 percentage points.
This outlook is based on an assumed effective currency exchange rate of
approximately $1.30 = ?1.00 for the 2013 third quarter and includes the impact
of existing hedging contracts. The third quarter will close on September
28, 2013.
Recent Corporate Developments
On April 22, ST announced the appointment of Martine Verluyten as Chair of the
Audit Committee of the ST Supervisory Board, succeeding Tom de Waard. Verluyten
has been a member of the ST Supervisory Board and has served on its Audit
Committee since May 2012.
On May 22, the Company announced that Executive Vice President Jean-Marc Chery
had been appointed General Manager of the Embedded Processing Solutions Segment,
a new position, and Vice-Chairman of the Corporate Strategic Committee where he
has been a Member since 2008. Chery continues to lead the Packaging and Test
Manufacturing and Quality functions for ST.
On May 28, ST announced that ST-Ericsson, a 50-50 joint venture with Ericsson
that the parent Companies are winding down, had sold the assets and intellectual
property rights (IPR) associated with its mobile connectivity Global Navigation
Satellite System (GNSS) to a leading semiconductor company.
On June 17, ST announced that it had signed a comprehensive agreement with
Rambus Inc. expanding existing licenses between the two Companies, settling all
outstanding claims, and committing both organizations to explore additional
opportunities for collaboration. The multifaceted agreement gives Rambus access
to ST's Fully-Depleted Silicon On Insulator (FD-SOI) process-technology design
environment while giving ST secured license terms from the Cryptography
Research, Inc. (CRI) division of Rambus that makes it possible for ST to expand
deployment of security technology for banking, identity, PayTV, video gaming,
smartphones, and government, across a wider range of products.
On June 21, 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 the shareholders were:
* The adoption of the Company's 2012 Statutory Annual Accounts prepared in
accordance with International Financial Reporting Standards (IFRS);
* The distribution, in line with the Dividend Policy of the Company, of a
semi-annual cash dividend per common share of US$0.10 in the second quarter
of 2013 and US$0.10 in the third quarter of 2013, to be paid in June and
September of 2013, respectively, to shareholders of record in the month of
each quarterly payment;
* The appointment of Ms. Janet Davidson as a new member of the Supervisory
Board for a three-year term, expiring at the 2016 AGM, as a replacement for
Mr. Raymond Bingham, whose mandate has expired;
* The reappointment of Mr. Alessandro Ovi as member of the Supervisory Board
for a three-year term, expiring at the 2016 AGM;
* The amendment of the compensation scheme of the Supervisory Board;
* The approval of a new four-year Unvested Stock Award Plan for Management and
Key Employees.
On May 21, ST announced its leadership of Places2Be, a 3-year, ?360M advanced-
technology pilot-line project with the participation of 18 other leading
European companies and academic institutions to support the industrialization of
Fully-Depleted Silicon-On-Insulator (FD-SOI) microelectronics technology.
Places2Be ("Pilot Lines for Advanced CMOS Enhanced by SOI in 2x nodes, Built in
Europe") aims to support the deployment of an FD-SOI pilot line at 28nm and the
subsequent node, as well as a dual source that will enable volume manufacturing
in Europe. Places2Be will drive the creation of a European microelectronics
design ecosystem using this FD-SOI platform and explore the path towards the
next step for this technology (14/10nm).
Q2 2013 - Product and Technology Highlights
During the quarter, ST made strong progress with important new-product
introductions and significant design wins.
Sense & Power and Automotive Products (SPA)
Analog, MEMS and Sensors (AMS)
* Deployment of the SPIRIT1, sub-GHz RF transceiver-based application for
remote control of street lights has begun along the river Seine in Paris.
* Earned design-ins for Pulser IC in portable ultrasound imaging equipment.
* Passed security certification by NDS for ST8034 smart-card interface, a
necessary step in the expansion of ST's smart-card presence in the set-top
box market.
* Captured a major socket in a 1(st)-tier customer in the glucose-metering
market with a dedicated op amp, reinforcing our best-in-class capabilities
and positioning in the analog segment.
* Collected a win for a high-end digital top-port microphone in a new tablet
to be launched this fall.
* Achieved milestone shipment rate of 10Munits/quarter for Fuel-Gauge battery-
monitor IC.
* Ramping production of 6-axis accelerometer and gyroscope for a high-profile
launch by a major phone manufacturer.
* Achieved significant qualifications for 6-axis accelerometer and gyroscope
and 6-axis accelerometer and compass for important phone manufacturers.
* In production with 9-axis inertial module for several innovative navigation-
related applications from top-tier Americas manufacturers.
Industrial and Power Discretes (IPD)
* Building momentum for MOSFETs with a qualification from a top switched-mode
power supply (SMPS) maker and captured design wins with important leaders
for lighting and charger applications in China and South Asia.
* Achieved big wins for IGBTs (Insulated Gate Bipolar Transistors) with a
large Asian welding customer and with Intelligent Power Modules for air-
conditioning and motor-control applications.
* Earned design wins in several server SMPS platforms with ViperPlus high-
voltage converters from a major Taiwanese SMPS manufacturer.
* Gaining market traction with the innovative digital-power STLUX385x platform
for various projects with wins in major EMEA lighting customers.
* Captured design wins from major German factory automation customers with
newest octal intelligent power switch.
* Earned wins for RF antenna-tuner solution for smartphones from a leading
Taiwanese OEM.
* Won new socket for the new field-effect rectifier diodes for mobile and
tablet chargers at a leading Asian OEM.
Automotive (APG)
* Earned an important award for a microcontroller companion chip that
integrates all key functions for stability-control systems for the Korean
market from a leading Korean supplier.
* Captured a design win from a global leader in the braking market for a fully
integrated electronic parking-brake solution.
* Reinforced leadership in Infotainment with the awarding of a multi-standard
digital terrestrial tuner from a leading European Tier 1.
* Won several awards for VIPower smart-power technology in Body Control
Modules from leading global Tier 1s and earned a socket from another leading
European Tier 1 for our 32-bit automotive microcontrollers for an airbag
application.
Embedded Processing Solutions (EPS)
Microcontroller, Memory and Secure MCU (MMS)
* Continued STM32 momentum with several design wins for the STM32 family for
smart-watch applications at major global OEMs, as a sensor-hub in various
mobile applications at a major manufacturer, and in a next-generation low-
power fitness-monitoring system at a key Americas OEM.
* Ramped production of STM32 controllers for Wi-Fi modules for Internet of
Things applications at various customers.
* Earned a win from a leading home-appliance manufacturer for our dual-
interface memory / dynamic NFC RFID tag in a washing machine.
* Captured the prestigious 'Electron d'Or 2013' award from ElectroniqueS
Magazine for the ST31, the first 32-bit Contactless Secure Microcontroller.
Digital Convergence (DCG)
* Continued building momentum for ASICs to be manufactured in 28nm FD-SOI
technology, with two new design wins for networking and consumer
applications.
* Maintained success with worldwide customers of awards for new set-top box
Class2 product family, which has now also obtained the full certification
from Nagra and Viaccess.
* Began an important design at a key customer for the US cable modem based on
the Orly/STiD platform.
* Captured multiple design-ins of DisplayPort smart connectivity products in
various applications, including 4Kx2K TV, the first TV
with DisplayPort input, at a large global consumer manufacturer.
Imaging, Bi-CMOS, ASIC and Silicon Photonics (IBP)
* Won a slot for the Image Signal Processor from a leading phone manufacturer.
* Secured design wins for ASICs using Silicon Photonics with two of the
world's top optical communications manufacturers.
* Collected a broad range of design wins from many customers that use ST
BiCMOS or Silicon Photonics process technology in almost 30 new ASIC
projects.
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, adjusted net earnings per share, free
cash flow, 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 anticipated by
such statements, due to, among other factors:
* uncertain macro-economic and industry trends;
* customer demand and acceptance for the products which we design, manufacture
and sell;
* unanticipated events or circumstances which may either impact our ability to
execute the planned reductions in our net operating expenses and / or meet
the objectives of our R&D Programs which benefit from public funding;
* future events or circumstances which may require us to reassess our
current plans concerning the break up and wind down of our ST-Ericsson
joint venture;
* the loading and the manufacturing performances of our production facilities;
* the functionalities and performance of our IT systems, which support our
critical operational activities including manufacturing, finance and sales;
* variations in the foreign exchange markets and, more particularly, in the
rate of 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;
* restructuring charges and associated cost savings that differ in amount or
timing from our estimates;
* 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 our results of operations as well as our ability to accurately
estimate tax credits, benefits, deductions and provisions and to realize
deferred tax assets;
* the outcome of ongoing litigation as well as the impact of any new
litigation to which we may become a defendant;
* natural events such as severe weather, earthquakes, tsunami, volcano
eruptions or other acts of nature, health risks and epidemics in locations
where we, our customers or our suppliers operate;
* changes in economic, social, political or infrastructure conditions in the
locations where we, our customers or our suppliers operate including as a
result of macro-economic or regional events, military conflict, social
unrest or terrorist activities;
* availability and costs of raw materials, utilities, third-party
manufacturing services, or other supplies required by our operations;
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, 2012, as filed with the SEC on March
4, 2013. 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 23, 2013, the management of STMicroelectronics will conduct a conference
call to discuss the Company's operating performance for the second quarter of
2013.
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
2, 2013.
About STMicroelectronics
ST is a global leader in the semiconductor market serving customers across the
spectrum of sense and power and automotive products and embedded processing
solutions. 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 2012, the Company's net revenues were $8.49 billion. Further information on
ST can be found at www.st.com.
(tables attached)
For further information, please contact:
INVESTOR RELATIONS:
Tait Sorensen
Group VP, Investor Relations
STMicroelectronics
Tel: +1 602 485 2064
tait.sorensen(at)st.com
MEDIA RELATIONS:
Nelly Dimey
Director, Corporate Media and Public Relations
STMicroelectronics
Tel: +33 158 077 785
nelly.dimey(at)st.com
+------------------------------------------------------------------------------+
|STMicroelectronics N.V. |
| |
|Consolidated Statements of |
|Income |
| |
|(in millions of U.S. dollars, |
|except per share data ($)) |
| |
| |
| |
| Three Months Ended |
| |
| (Unaudited) (Unaudited) |
| ------------------------------------------------+
| June 29, June 30,|
| |
| 2013 2012|
| |
| |
| |
|Net sales |
| 2,034 2,140|
| |
|Other revenues |
| 11 8|
| ------------------------------------------------+
| NET REVENUES |
| 2,045 2,148|
| |
|Cost of sales |
| (1,373) (1,412)|
| ------------------------------------------------+
| GROSS PROFIT |
| 672 736|
| |
|Selling, general and |
|administrative (285) (292)|
| |
|Research and development |
| (453) (617)|
| |
|Other income and expenses, net |
| 2 22|
| |
|Impairment, restructuring |
|charges and other related (43) (56)|
|closure costs |
| ------------------------------------------------+
| Total Operating Expenses |
| (779) (943)|
| ------------------------------------------------+
| OPERATING LOSS |
| (107) (207)|
| |
|Interest income (expense), net |
| 7 (6)|
| |
|Income (loss) on equity-method |
|investments (89) (2)|
| |
|LOSS BEFORE INCOME TAXES |
| (189) (215)|
| |
| AND NONCONTROLLING INTEREST |
| |
|Income tax benefit (expense) |
| 16 (20)|
| ------------------------------------------------+
| NET LOSS |
| (173) (235)|
| |
|Net loss (income) attributable |
|to noncontrolling interest 21 160|
| ------------------------------------------------+
| NET LOSS ATTRIBUTABLE TO |
|PARENT COMPANY (152) (75)|
| ------------------------------------------------+
| |
| |
| EARNINGS PER SHARE (BASIC) |
|ATTRIBUTABLE TO PARENT COMPANY (0.17) (0.08)|
|STOCKHOLDERS |
| |
| EARNINGS PER SHARE (DILUTED) |
|ATTRIBUTABLE TO PARENT COMPANY (0.17) (0.08)|
|STOCKHOLDERS |
| |
| |
| |
| NUMBER OF WEIGHTED AVERAGE |
| |
| SHARES USED IN CALCULATING |
| |
| EARNINGS PER SHARE 889.0 886.1|
+------------------------------------------------------------------------------+
+------------------------------------------------------------------------------+
|STMicroelectronics N.V. |
| |
|Consolidated Statements of |
|Income |
| |
|(in millions of U.S. dollars, |
|except per share data ($)) |
| |
| |
| |
| Six Months Ended |
| |
| (Unaudited) (Unaudited) |
| ------------------------------------------------+
| June 29, June 30,|
| |
| 2013 2012|
| |
| |
| |
|Net sales 4,037 4,150|
| |
|Other revenues |
| 18 15|
| ------------------------------------------------+
| NET REVENUES |
| 4,055 4,165|
| |
|Cost of sales |
| (2,755) (2,833)|
| ------------------------------------------------+
| GROSS PROFIT |
| 1,300 1,332|
| |
|Selling, general and |
|administrative (564) (602)|
| |
|Research and development |
| (986) (1,250)|
| |
|Other income and expenses, net |
| 6 35|
| |
|Impairment, restructuring |
|charges and other related (144) (74)|
|closure costs |
| ------------------------------------------------+
| Total Operating Expenses |
| (1,688) (1,891)|
| ------------------------------------------------+
| OPERATING LOSS |
| (388) (559)|
| |
|Interest expense, net |
| - (19)|
| |
|Loss on equity-method |
|investments (102) (9)|
| |
|Gain on financial instruments, |
|net - 3|
| |
| LOSS BEFORE INCOME TAXES |
| (490) (584)|
| |
| AND NONCONTROLLING INTEREST |
| |
|Income tax benefit |
| 21 14|
| ------------------------------------------------+
| NET LOSS |
| (469) (570)|
| |
|Net loss (income) attributable |
|to noncontrolling interest 147 318|
| ------------------------------------------------+
| NET LOSS ATTRIBUTABLE TO |
|PARENT COMPANY (322) (252)|
| ------------------------------------------------+
| |
| |
| EARNINGS PER SHARE (BASIC) |
|ATTRIBUTABLE TO PARENT COMPANY (0.36) (0.28)|
|STOCKHOLDERS |
| |
| EARNINGS PER SHARE (DILUTED) |
|ATTRIBUTABLE TO PARENT COMPANY (0.36) (0.28)|
|STOCKHOLDERS |
| |
| |
| |
| NUMBER OF WEIGHTED AVERAGE |
| |
| SHARES USED IN CALCULATING |
| |
| EARNINGS PER SHARE 888.5 885.5|
+------------------------------------------------------------------------------+
+------------------------------------------------------------------------------+
|STMicroelectronics N.V. |
| |
|CONSOLIDATED BALANCE SHEETS |
| |
|As at June 29, March 30, December 31,|
| |
|In millions of U.S. dollars 2013 2013 2012 |
| -------------------------------------+
| (Unaudited) (Unaudited) Audited |
+------------------------------------------------------------------------------+
|ASSETS |
| |
|Current assets: |
| |
|Cash and cash equivalents 1,583 1,718 2,250|
| |
|Short-term deposits 1 1 1|
| |
|Marketable securities 189 187 238|
| |
|Trade accounts receivable, net 1,118 1,025 1,005|
| |
|Inventories 1,336 1,306 1,353|
| |
|Deferred tax assets 224 141 137|
| |
|Assets held for sale 28 37 -|
| |
|Other current assets 567 501 518|
| -------------------------------------+
|Total current assets 5,046 4,916 5,502|
| |
|Goodwill 135 140 141|
| |
|Other intangible assets, net 250 208 213|
| |
|Property, plant and equipment, net 3,276 3,275 3,481|
| |
|Non-current deferred tax assets 395 439 414|
| |
|Restricted cash - 4 4|
| |
|Long-term investments 29 110 119|
| |
|Other non-current assets 512 540 560|
| -------------------------------------+
| 4,597 4,716 4,932|
| -------------------------------------+
|Total assets 9,643 9,632 10,434|
| |
| |
| |
|LIABILITIES AND EQUITY |
| |
|Current liabilities: |
| |
|Short-term debt 313 250 630|
| |
|Trade accounts payable 985 862 797|
| |
|Other payables and accrued liabilities 993 997 942|
| |
|Dividends payable to stockholders 94 - 89|
| |
|Deferred tax liabilities 1 11 11|
| |
|Accrued income tax 65 77 86|
| -------------------------------------+
|Total current liabilities 2,451 2,197 2,555|
| |
|Long-term debt 651 647 671|
| |
|Post-retirement benefit obligations 492 474 477|
| |
|Long-term deferred tax liabilities 15 15 14|
| |
|Other long-term liabilities 357 351 353|
| -------------------------------------+
| 1,515 1,487 1,515|
| |
|Total liabilities 3,966 3,684 4,07
Unternehmensinformation / Kurzprofil:
Datum: 22.07.2013 - 22:48 Uhr
Sprache: Deutsch
News-ID 280622
Anzahl Zeichen: 65601
contact information:
Town:
Geneva
Kategorie:
Business News
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