• Quarterly net revenue up 2 percent sequentially; FY 2012 revenue up 1 percent the prior year
• Quarterly GAAP gross margin of 48.4 percent; Quarterly Non-GAAP gross margin of 51.1 percent
• Quarterly GAAP diluted EPS of $0.64; Quarterly Non-GAAP diluted EPS of $0.77
SAN JOSE, Calif., SINGAPORE, Nov. 29, 2012 (GLOBE NEWSWIRE) -- Avago Technologies Limited (Nasdaq:AVGO), a leading supplier of analog interface components for communications, industrial consumer applications, today reported financial results for the fourth fiscal quarter fiscal year ended October 28, 2012, provided guidance for the first quarter of its fiscal year 2013.
Fourth Quarter Fiscal Year 2012 GAAP Results
Net revenue was $618 million, an increase of 2 percent compared with the previous quarter a decrease of 1 percent the same quarter last year.
Gross margin was $299 million, 48.4 percent of net revenue. This compares with gross margin of $295 million, 48.7 percent of net revenue last quarter, gross margin of $304 million, 48.8 percent of net revenue in the same quarter last year.
Operating expenses were $135 million. This compares with $146 million in the prior quarter $145 million for the same quarter the previous year.
Income operations was $164 million. This compares with $149 million in the prior quarter with $159 million in the same quarter last year.
Fourth quarter net income was $159 million, $0.64 per diluted share. This compares with net income of $145 million, $0.58 per diluted share for the prior quarter, net income of $154 million, $0.61 per diluted share in the same quarter last year.
The Company's cash balance at the end of the fourth quarter was $1,084 million, compared to $973 million at the end of the prior quarter.
The Company generated $215 million in cash operations in the fourth quarter spent $73 million on capital expenditures.
On October 1, 2012 the Company paid a quarterly cash dividend of 16 cents ($0.16) per ordinary share, totaling approximately $39 million.
Fourth Quarter Fiscal Year 2012 Non-GAAP Results
Gross margin was $316 million, 51.1 percent of net revenue. This compares with gross margin of $310 million, 51.2 percent of net revenue last quarter, gross margin of $319 million, 51.2 percent of net revenue in the same quarter last year.
Income operations was $199 million. This compares with $186 million in the prior quarter $191 million in the same quarter the previous year.
Net income was $194 million, $0.77 per diluted share. This compares with net income of $182 million, $0.72 per diluted share last quarter, net income of $186 million, $0.73 per diluted share in the same quarter last year.

"Strong product ramps at major smartphone customers more than offset weakness in industrial wired infrastructure, resulting in a 2% sequential revenue growth in the fourth quarter. Sequential revenue growth of 8% for our three primary target markets in the quarter was overshadowed by the anticipated $31 million decrease in revenue our legacy consumer navigation products," said Hock Tan, President CEO of Avago Technologies Limited. "Looking to the first fiscal quarter of 2013, however, we expect continued softness in wired infrastructure continued supply chain contraction in industrial will result in a decrease in revenue."

Other Quarterly Data

Fiscal Year 2012 Financial Results

Net revenue grew 1 percent to $2.364 billion when compared to fiscal year 2011. GAAP gross margin was $1,142 million, 48.3 percent of net revenue versus $1,147 million, 49.1 percent of net revenue in fiscal year 2011. GAAP net income was $563 million, $2.25 per diluted share. This compares with GAAP net income of $552 million, $2.19 per diluted share in fiscal year 2011.

Non-GAAP gross margin was $1,206 million, 51.0 percent of net revenue compared with $1,207 million 51.7 percent of net revenue in fiscal year 2011. Non-GAAP net income of $700 million, $2.77 per diluted share, compared with $692 million, $2.70 per diluted share, last fiscal year.

First Quarter Fiscal Year 2013 Business Outlook

Due to the Company's 52/53 week reporting cycle, fiscal year 2013 will include an extra week, compared to fiscal year 2012, which will fall in the first quarter of fiscal year 2013. Based on current business trends conditions, the outlook for the first quarter of fiscal year 2013, ending February 3, 2013, is expected to be as follows:

Reconciling items include $14 million of amortization of acquisition-related intangibles $2 million of share-based compensation expense at the Gross Margin line, $5 million of amortization of acquisition-related intangibles, $15 million of share-based compensation $1 million of restructuring charges at the Operating Expenses line.

Capital expenditures for the first quarter are expected to be in the range of $75 million to $85 million. For the first quarter depreciation is expected to be $21 million amortization is expected to be $19 million.

The guidance provided above is only an estimate of what the Company believes is realizable as of the date of this release. The guidance excludes any impact share repurchases mergers acquisitions activity that may occur during the quarter. Actual results will vary the guidance the variations may be material. The Company undertakes no intent obligation to publicly update revise any of these projections, whether as a result of new information, future events otherwise, except as required by law.

Avago will be hosting its 2012 Investor Analyst Day in New York on December 14, 2012. The Company's presentations will be webcast available for replay on the "Investors" section of Avago's website at www.avagotech.com. Avago will be presenting at the J.P. Morgan Tech Forum, meeting with investors at Nomura@2013 CES, at the 2013 International CES in Las Vegas on January 8, 2013.

Financial Results Conference Call

Avago Technologies Limited will host a conference call to review its financial results for the fourth quarter fiscal year 2012, to provide guidance for the first quarter of fiscal year 2013, today at 2:00 p.m. Pacific Time. Those wishing to access the call should dial 800-259-0251; International +1-617-614-3671. The passcode is 84256862. A replay of the call will be available through December 6, 2012. To access the replay dial 888-286-8010; International +1-617-801-6888 reference the passcode: 29833583. A webcast of the conference call will also be available in the "Investors" section of Avago's website at www.avagotech.com.

Non-GAAP Financial Measures

In addition to GAAP reporting, Avago provides investors with net income, income operations, gross margin, operating expenses other data, on a non-GAAP basis. This non-GAAP information excludes amortization of acquisition-related intangibles, share-based compensation expense, restructuring charges debt extinguishment losses. Management does believe that the excluded items are reflective of the Company's underlying performance. The exclusion of these other similar items Avago's non-GAAP presentation should be interpreted as implying that these items are non-recurring, infrequent unusual. Avago believes this non-GAAP financial information provides additional insight into the Company's on-going performance has therefore chosen to provide this information to investors for a more consistent basis of comparison to help them evaluate the results of the Company's on-going operations enable more meaningful period to period comparisons. These non-GAAP measures are provided in addition to, as a substitute for, superior to, measures of financial performance prepared in accordance with GAAP. A reconciliation between GAAP non-GAAP financial data is included in the supplemental financial data attached to this press release.

About Avago Technologies Limited

Avago Technologies Limited is a leading designer, developer global supplier of a broad range of analog semiconductor devices with a focus on III-V based products. Our product portfolio is extensive includes over 6,500 products in three primary target markets: wireless communications, wired infrastructure industrial automotive electronics.

The Avago Technologies logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=14098

Cautionary Note Regarding Forward-Looking Statements

This announcement contains forward-looking statements which address our expected future business financial performance. These forward-looking statements are based on current expectations, estimates, forecasts projections of future Company industry performance, based on management's judgment, beliefs, current trends market conditions, involve risks uncertainties that may cause actual results to differ materially those contained in the forward-looking statements. Accordingly, we caution you to place undue reliance on these statements. For Avago, particular uncertainties that could materially affect future results include global economic conditions concerns; cyclicality in the semiconductor industry in our target markets; quarterly annual fluctuations in operating results; loss of our significant customers; increased dependence on the volatile, wireless handset market; our competitive performance ability to continue achieving design wins with our customers; our dependence on contract manufacturing outsourced supply chain our ability to improve our cost structure through our manufacturing outsourcing program; prolonged disruptions of our our contract manufacturers' manufacturing facilities other significant operations; our increased dependence on outsourced service providers for certain key business services their ability to execute to our requirements; our ability to maintain gross margin; our ability to maintain tax concessions in certain jurisdictions; our ability to protect our intellectual property any associated increases in litigation expenses; dependence on risks associated with distributors of our products; any expenses associated with resolving customer product warranty indemnification claims; our ability to achieve the growth prospects synergies expected acquisitions we may make; delays, challenges expenses associated with integrating acquired companies with our existing businesses; other events trends on a national, regional global scale, including those of a political, economic, business, competitive regulatory nature. Our Quarterly Report on Form 10-Q filed on August 30, 2012 other filings with the Securities Exchange Commission, "SEC" (which you may obtain for free at the SEC's website at http://www.sec.gov) discuss some of the important risk factors that may affect our business, results of operations financial condition. We undertake no intent obligation to publicly update revise any of these forward looking statements, whether as a result of new information, future events otherwise, except as required by law.