Product category: Microprocessors, Microcontrollers and DSPs
News Release from: Freescale Semiconductor
Edited by the Electronicstalk Editorial Team on 30 April 2007

Sales rise for semiconductor manufacturer

Adjusting for the sales of product lines that have since been discontinued, Freescale's revenues were essentially flat compared to the prior year

Freescale Semiconductor has announced financial results for the first quarter ended March 30th, 2007. Net sales for the first quarter of 2007 were US $1.36 billion, compared to US $1.53 billion in the first quarter of 2006. Net sales were reduced in the quarter by a sales decline in the company's wireless and mobile solutions segment.

The decline in sales resulted from lower demand from the segment's largest customer.

'Our transportation and networking segments continue to generate solid sales and operational profitability', said Michel Mayer, Chairman and CEO.

'However, the challenging market conditions in the wireless market negatively impacted our overall first quarter results'.

Operating earnings, net earnings and earnings before interest, taxes, depreciation and amortisation (EBITDA) now include noncash purchase accounting expenses related to the company's acquisition by a private equity consortium in December 2006.

The company believes that providing operating earnings and EBITDA exclusive of these expenses is a more meaningful representation of the company's ongoing financial performance.

Including the aforementioned expenses, the operating, net and EBITDA losses for the first quarter of 2007 were US $654 million, US $539 million and US $119 million, respectively.

Excluding these expenses, operating earnings were US $149 million and EBITDA was US $300 million.

This compares to operating earnings of US $207 million and EBITDA of US $371 million in the first quarter of 2006.

The company also uses Adjusted EBITDA to measure compliance with some of its debt covenants.

Adjusted EBITDA for the first quarter of 2007 was US $335 million.

Adjusted EBITDA for the 12 months ended March 30, 2007 was US $1.75 billion.

The transportation and standard products segment reported net sales of US $665 million in the first quarter of 2007, compared to US $653 million in the first quarter of 2006.

First quarter 2007 sales benefited from growth in the company's sensor and analogue products along with growth in the non-US automotive business.

EBITDA for the first quarter was a loss of US $8 million.

Excluding noncash purchase accounting items, EBITDA was US $178 million, or 27% of sales.

The networking and computing systems segment reported net sales of US $320 million, compared to US $351 million in the first quarter of 2006.

First quarter 2006 sales included revenue from product lines that have since been discontinued.

Adjusting for these sales, revenues were essentially flat compared to the prior year.

Net sales benefited from higher demand for the company's digital home solutions offset by slower sales into the wireless infrastructure markets.

EBITDA for the first quarter was a loss of US $88 million.

Excluding noncash purchase accounting items, EBITDA was US $90 million, or 28% of sales.

The wireless and mobile solutions segment reported net sales of US $364 million in the first quarter of 2007, compared to US $506 million in the first quarter of 2006.

Net sales were negatively impacted by lower shipments to the segment's largest customer.

EBITDA for the first quarter was a loss of US $24 million.

Excluding noncash purchase accounting items, EBITDA was US $28 million, or 8% of sales.

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