Q2 results exceed guidance

ON Semiconductor Corp has revealed that total revenues in the second quarter of 2004 were $333.5 million, an increase of 8% from the first quarter of 2004.

ON Semiconductor Corp has revealed that total revenues in the second quarter of 2004 were $333.5 million, an increase of 8% from the first quarter of 2004.

During the second quarter of 2004, the company reported a net loss of $3.5 million, or $0.02 per share, that included restructuring, asset impairments and other charges of $0.9 million, and a loss on debt prepayment of $27.4 million, or $0.11 per share.

During the first quarter of 2004, the company reported a net loss of $47.6 million, or $0.23 per share, that included restructuring, asset impairments and other charges of $13.1 million, or $0.06 per share, and a loss on debt prepayment of $33.0 million, or $0.14 per share.

On a mix-adjusted basis, average selling prices in the second quarter of 2004 were up approximately 2% from the first quarter of 2004.

The company's gross margin in the second quarter was 33.7%, an increase of approximately 260 basis points as compared to the first quarter of 2004 due to a combination of increased average selling prices, increased unit volumes and cost reductions.

EBITDA for the second quarter of 2004 was $46.1 million and included restructuring, asset impairments and other charges of $0.9 million and the $27.4 million loss on debt prepayment.

EBITDA for the first quarter of 2004 was $14.2 million and included restructuring, asset impairments and other charges of $13.1 million and the $33.0 million loss on debt prepayment.

The $0.9 million in restructuring, asset impairments and other charges for the second quarter of 2004 included approximately $2.5 million of cash charges, primarily for severance and a reversal of approximately $1.6 million of cash charges, primarily for severance, reserved for in the fourth quarter of 2002.

The $13.1 million in restructuring, asset impairments and other charges for the first quarter of 2004 included approximately $12.0 million of non-cash charges for a loss on sale of fixed assets and approximately $1.1 million of cash charges, primarily for severance.

"We continue to execute on our corporate strategy", said Keith Jackson, ON Semiconductor President and CEO.

"Revenue grew by 8%, exceeding guidance, and gross margin is at the highest level since the third quarter of 2000, on roughly 60% of the revenue base".

"We are optimistic about our business environment and believe we are well positioned for the normally stronger second half of the year".

"Based upon booking trends, backlog levels and estimated turns levels, we anticipate that total revenues will be up by 2 to 5% sequentially in the third quarter", Jackson said.

"Backlog levels at the beginning of the third quarter of 2004 were up from backlog levels at the beginning of the second quarter of 2004 and represented greater than 90% of our anticipated third quarter revenues".

"We expect that average selling prices will be slightly up for the third quarter of 2004 and that gross margins will increase by 50 to 100 basis points".

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