ISSI Announces Second Fiscal Quarter Results

Apr 25, 2001, 01:00 ET from Integrated Silicon Solution, Inc.

    SANTA CLARA, Calif., April 25 /PRNewswire/ --
 Integrated Silicon Solution, Inc. (Nasdaq:   ISSI) today reported financial
 results for the second fiscal quarter ended March 31, 2001.
     Revenue for the second fiscal quarter was $52.0 million, compared with
 revenue of $30.0 million for the March 2000 quarter.   This reflects an
 increase of 73% in revenue year-to-year.  This also compares with revenue from
 the December 2000 quarter of $65.2 million.
     Net income for the March 2001 quarter was $4.5 million and $0.16 per share
 based on 27.8 million diluted shares outstanding.  The net income of $4.5
 million included a pre-tax gain on the sale of the Company's investment in
 Integrated Circuit Solution, Inc. (ICSI), which completed an initial public
 offering on the Taiwan stock exchange in January 2001, of $6.3 million; a pre-
 tax gain on the sale of the Company's investment in NexFlash Technologies,
 Inc. of $5.3 million; and an inventory write-down of $11.7 million.  Excluding
 NexFlash and the inventory write-down, net income for the
 March 2001 quarter was $9.3 million and earnings per share was $0.33.  This
 compares with the March 2000 quarter net income of $30.0 million and $0.14 per
 share based on 24.9 million diluted shares outstanding.
     "After four consecutive quarters of 28% to 30% growth in revenue last
 year, the market trends have now impacted ISSI," said Jimmy Lee, ISSI's
 Chairman and CEO.  "However, we believe that business fundamentals remain
 solid.  We have $140 million in cash, and we are laying the groundwork for
 future growth during this slow-down.  We are accelerating new product
 development using state-of-the-art 0.13 micron technology.  We have added
 several new products at the 4 meg and 8 meg levels and are currently
 developing the first 18 meg Sigma RAM with the widest data bus of 72 bits and
 a 300 MHz clock rate."
 
     Integrated Circuit Solutions, Inc. (ICSI)
     ISSI recently reported that, in the March 2001 quarter, it sold some of
 its equity in ICSI in connection with ICSI's January 2001 initial public
 offering on the Taiwan stock exchange.  ICSI is ISSI's former Taiwan
 subsidiary.  For ISSI, this transaction resulted in a pre-tax profit of $6.3
 million for the March 2001 quarter.  ISSI is still ICSI's largest shareholder,
 and the current value of ISSI's ownership is approximately $131 million.
 
     NexFlash Technologies, Inc.
     In the March 2001 quarter, ISSI, along with other shareholders, sold a
 portion of its ownership in NexFlash to Winbond International Corporation, an
 investment arm of Winbond Electronics Corporation (Winbond) of Taiwan.
 Winbond acquired a minority stake in NexFlash in an all cash transaction
 totaling $33 million.  Approximately 45% of the proceeds went to NexFlash,
 with the remainder going to existing preferred shareholders, including ISSI.
 This transaction resulted in a pre-tax profit to ISSI of $5.3 million.
 
     Company Information
     ISSI designs, develops and markets high performance memory semiconductors
 used in internet access devices, networking equipment, telecom and mobile
 communications equipment, and computer peripherals.  Our high speed and low
 power SRAMs and our low to medium density DRAMs enable customers to design
 products that meet the demanding connectivity, portability, and bandwidth
 requirements of the internet infrastructure.  A substantial majority of ISSI's
 sales come from the data communications and telecommunications markets.  ISSI
 serves as the memory solutions company to these markets.  Our customers
 include companies such as Alcatel, Cisco, Motorola, 3Com, and others.
 
     Safe Harbor Statement
     Certain statements in this news release, including statements regarding
 ISSI's business fundamentals and future growth, are forward-looking statements
 that are subject to risks and uncertainties, including the risks that future
 growth may not occur and that new products will not be developed as currently
 expected. In addition, actual results may differ materially from current
 expectations due to order cancellations, order rescheduling, decreasing
 demand, failure to book additional orders, reduction in average selling prices
 for the Company's products and a resultant decrease in the Company's gross
 profit margin, changes in industry conditions, imbalances between supply and
 demand, the level of market acceptance of the Company's products, product
 warranty claims, competition, the level and value of inventory held by OEM
 customers or the Company, the timing of industry cycles, the Company's ability
 to successfully grow revenue, import duties, or other factors.  In addition,
 the Company's value in ICSI will decrease or increase as the share price moves
 in the public market, and there are certain restrictions on trading the shares
 of ICSI.  Future cash and debt balances may change as a result of declining
 market conditions, operating performance, or investments. Further information
 that could affect the Company's results is detailed in ISSI's periodic filings
 with the Securities and Exchange Commission, including its Annual Report on
 Form 10K for the fiscal year ended September 30, 2000 and its most recent
 Quarterly Report on Form 10Q for the quarter ended December 31, 2000.
 
     Consolidated Statement of Operations and Consolidated Balance Sheets to
 follow.
 
 
                       Integrated Silicon Solution, Inc.
                Condensed Consolidated Statements of Operations
                                  (Unaudited)
                     (In thousands, except per share data)
 
                                       Three Months Ended    Six Months Ended
                                            March 31,            March 31,
                                         2001      2000       2001      2000
 
 
     Net sales                          $52,023   $30,032   $117,252   $53,283
     Cost of sales                       48,564    21,232     91,618    38,203
     Gross Profit                         3,459     8,800     25,634    15,080
 
     Operating Expenses:
       Research and development           6,612     4,197     13,329     7,816
       Selling, general and
        administrative                    5,888     3,422     12,118     6,629
         Total operating expenses        12,500     7,619     25,447    14,445
 
     Operating income (loss)             (9,041)    1,181        187       635
     Other income (expense), net          1,845       516      3,352       460
     Gain on sale of ICSI                 6,293        --      6,293        --
     Gain on sale of investments          5,268        --     22,470        --
     Income before income taxes and
      equity in net income of affiliated
      companies                           4,365     1,697     32,302     1,095
     Provision for income taxes           1,091       150      8,076       200
 
     Net income before equity in net
      income of affiliated companies      3,274     1,547     24,226       895
 
     Equity in net income of affiliated
      companies                           1,195     1,838      5,318     2,984
 
     Net income                          $4,469    $3,385    $29,544    $3,879
 
     Basic income per share               $0.17     $0.15      $1.14     $0.18
     Shares used in basic per share
      calculation                        26,093    21,992     25,957    21,185
 
     Diluted income per share             $0.16     $0.14      $1.07     $0.16
     Shares used in diluted per share
      calculation                        27,797    24,946     27,602    23,722
 
 
                       Integrated Silicon Solution, Inc.
                     Condensed Consolidated Balance Sheets
                                 (In thousands)
 
                                                     March 31,  September 30,
                                                       2001        2000
                                                    (unaudited)     (A)
                             ASSETS
     Current assets:
       Cash and cash equivalents                     $27,318      $38,778
       Short-term investments                        113,200       58,800
       Accounts receivable                            35,463       28,051
       Inventories                                    74,948       63,217
       Other current assets                            3,817        1,271
 
     Total current assets                            254,746      190,117
     Property, equipment, and leasehold improvements,
      net                                              6,602        5,429
     Other assets                                     54,067       65,178
     Total assets                                   $315,415     $260,724
 
             LIABILITIES AND STOCKHOLDERS' EQUITY
     Current liabilities:
       Accounts payable                              $45,043      $33,454
       Accrued compensation and benefits               3,600        2,424
       Accrued expenses                               10,845        7,513
       Income tax payable                              8,307          648
       Current portion of long-term obligations          148          140
 
     Total current liabilities                        67,943       44,179
     Income tax payable - non-current                  4,996        4,996
     Long-term obligations                               238          314
 
     Stockholders' equity:
       Preferred stock                                    --           --
       Common stock                                        3            3
       Additional paid-in capital                    219,829      217,845
       Retained earnings (accumulated deficit)        26,718       (2,826)
       Accumulated comprehensive income               (4,303)      (3,769)
       Unearned compensation                              (9)         (18)
 
     Total stockholders' equity                      242,238      211,235
     Total liabilities and stockholders' equity     $315,415     $260,724
 
     (A) Derived from audited financial statements.
 
 
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                http://tbutton.prnewswire.com/prn/11690X35290413
 
 

SOURCE Integrated Silicon Solution, Inc.
    SANTA CLARA, Calif., April 25 /PRNewswire/ --
 Integrated Silicon Solution, Inc. (Nasdaq:   ISSI) today reported financial
 results for the second fiscal quarter ended March 31, 2001.
     Revenue for the second fiscal quarter was $52.0 million, compared with
 revenue of $30.0 million for the March 2000 quarter.   This reflects an
 increase of 73% in revenue year-to-year.  This also compares with revenue from
 the December 2000 quarter of $65.2 million.
     Net income for the March 2001 quarter was $4.5 million and $0.16 per share
 based on 27.8 million diluted shares outstanding.  The net income of $4.5
 million included a pre-tax gain on the sale of the Company's investment in
 Integrated Circuit Solution, Inc. (ICSI), which completed an initial public
 offering on the Taiwan stock exchange in January 2001, of $6.3 million; a pre-
 tax gain on the sale of the Company's investment in NexFlash Technologies,
 Inc. of $5.3 million; and an inventory write-down of $11.7 million.  Excluding
 NexFlash and the inventory write-down, net income for the
 March 2001 quarter was $9.3 million and earnings per share was $0.33.  This
 compares with the March 2000 quarter net income of $30.0 million and $0.14 per
 share based on 24.9 million diluted shares outstanding.
     "After four consecutive quarters of 28% to 30% growth in revenue last
 year, the market trends have now impacted ISSI," said Jimmy Lee, ISSI's
 Chairman and CEO.  "However, we believe that business fundamentals remain
 solid.  We have $140 million in cash, and we are laying the groundwork for
 future growth during this slow-down.  We are accelerating new product
 development using state-of-the-art 0.13 micron technology.  We have added
 several new products at the 4 meg and 8 meg levels and are currently
 developing the first 18 meg Sigma RAM with the widest data bus of 72 bits and
 a 300 MHz clock rate."
 
     Integrated Circuit Solutions, Inc. (ICSI)
     ISSI recently reported that, in the March 2001 quarter, it sold some of
 its equity in ICSI in connection with ICSI's January 2001 initial public
 offering on the Taiwan stock exchange.  ICSI is ISSI's former Taiwan
 subsidiary.  For ISSI, this transaction resulted in a pre-tax profit of $6.3
 million for the March 2001 quarter.  ISSI is still ICSI's largest shareholder,
 and the current value of ISSI's ownership is approximately $131 million.
 
     NexFlash Technologies, Inc.
     In the March 2001 quarter, ISSI, along with other shareholders, sold a
 portion of its ownership in NexFlash to Winbond International Corporation, an
 investment arm of Winbond Electronics Corporation (Winbond) of Taiwan.
 Winbond acquired a minority stake in NexFlash in an all cash transaction
 totaling $33 million.  Approximately 45% of the proceeds went to NexFlash,
 with the remainder going to existing preferred shareholders, including ISSI.
 This transaction resulted in a pre-tax profit to ISSI of $5.3 million.
 
     Company Information
     ISSI designs, develops and markets high performance memory semiconductors
 used in internet access devices, networking equipment, telecom and mobile
 communications equipment, and computer peripherals.  Our high speed and low
 power SRAMs and our low to medium density DRAMs enable customers to design
 products that meet the demanding connectivity, portability, and bandwidth
 requirements of the internet infrastructure.  A substantial majority of ISSI's
 sales come from the data communications and telecommunications markets.  ISSI
 serves as the memory solutions company to these markets.  Our customers
 include companies such as Alcatel, Cisco, Motorola, 3Com, and others.
 
     Safe Harbor Statement
     Certain statements in this news release, including statements regarding
 ISSI's business fundamentals and future growth, are forward-looking statements
 that are subject to risks and uncertainties, including the risks that future
 growth may not occur and that new products will not be developed as currently
 expected. In addition, actual results may differ materially from current
 expectations due to order cancellations, order rescheduling, decreasing
 demand, failure to book additional orders, reduction in average selling prices
 for the Company's products and a resultant decrease in the Company's gross
 profit margin, changes in industry conditions, imbalances between supply and
 demand, the level of market acceptance of the Company's products, product
 warranty claims, competition, the level and value of inventory held by OEM
 customers or the Company, the timing of industry cycles, the Company's ability
 to successfully grow revenue, import duties, or other factors.  In addition,
 the Company's value in ICSI will decrease or increase as the share price moves
 in the public market, and there are certain restrictions on trading the shares
 of ICSI.  Future cash and debt balances may change as a result of declining
 market conditions, operating performance, or investments. Further information
 that could affect the Company's results is detailed in ISSI's periodic filings
 with the Securities and Exchange Commission, including its Annual Report on
 Form 10K for the fiscal year ended September 30, 2000 and its most recent
 Quarterly Report on Form 10Q for the quarter ended December 31, 2000.
 
     Consolidated Statement of Operations and Consolidated Balance Sheets to
 follow.
 
 
                       Integrated Silicon Solution, Inc.
                Condensed Consolidated Statements of Operations
                                  (Unaudited)
                     (In thousands, except per share data)
 
                                       Three Months Ended    Six Months Ended
                                            March 31,            March 31,
                                         2001      2000       2001      2000
 
 
     Net sales                          $52,023   $30,032   $117,252   $53,283
     Cost of sales                       48,564    21,232     91,618    38,203
     Gross Profit                         3,459     8,800     25,634    15,080
 
     Operating Expenses:
       Research and development           6,612     4,197     13,329     7,816
       Selling, general and
        administrative                    5,888     3,422     12,118     6,629
         Total operating expenses        12,500     7,619     25,447    14,445
 
     Operating income (loss)             (9,041)    1,181        187       635
     Other income (expense), net          1,845       516      3,352       460
     Gain on sale of ICSI                 6,293        --      6,293        --
     Gain on sale of investments          5,268        --     22,470        --
     Income before income taxes and
      equity in net income of affiliated
      companies                           4,365     1,697     32,302     1,095
     Provision for income taxes           1,091       150      8,076       200
 
     Net income before equity in net
      income of affiliated companies      3,274     1,547     24,226       895
 
     Equity in net income of affiliated
      companies                           1,195     1,838      5,318     2,984
 
     Net income                          $4,469    $3,385    $29,544    $3,879
 
     Basic income per share               $0.17     $0.15      $1.14     $0.18
     Shares used in basic per share
      calculation                        26,093    21,992     25,957    21,185
 
     Diluted income per share             $0.16     $0.14      $1.07     $0.16
     Shares used in diluted per share
      calculation                        27,797    24,946     27,602    23,722
 
 
                       Integrated Silicon Solution, Inc.
                     Condensed Consolidated Balance Sheets
                                 (In thousands)
 
                                                     March 31,  September 30,
                                                       2001        2000
                                                    (unaudited)     (A)
                             ASSETS
     Current assets:
       Cash and cash equivalents                     $27,318      $38,778
       Short-term investments                        113,200       58,800
       Accounts receivable                            35,463       28,051
       Inventories                                    74,948       63,217
       Other current assets                            3,817        1,271
 
     Total current assets                            254,746      190,117
     Property, equipment, and leasehold improvements,
      net                                              6,602        5,429
     Other assets                                     54,067       65,178
     Total assets                                   $315,415     $260,724
 
             LIABILITIES AND STOCKHOLDERS' EQUITY
     Current liabilities:
       Accounts payable                              $45,043      $33,454
       Accrued compensation and benefits               3,600        2,424
       Accrued expenses                               10,845        7,513
       Income tax payable                              8,307          648
       Current portion of long-term obligations          148          140
 
     Total current liabilities                        67,943       44,179
     Income tax payable - non-current                  4,996        4,996
     Long-term obligations                               238          314
 
     Stockholders' equity:
       Preferred stock                                    --           --
       Common stock                                        3            3
       Additional paid-in capital                    219,829      217,845
       Retained earnings (accumulated deficit)        26,718       (2,826)
       Accumulated comprehensive income               (4,303)      (3,769)
       Unearned compensation                              (9)         (18)
 
     Total stockholders' equity                      242,238      211,235
     Total liabilities and stockholders' equity     $315,415     $260,724
 
     (A) Derived from audited financial statements.
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X35290413
 
 SOURCE  Integrated Silicon Solution, Inc.

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