Monolithic Power Systems Announces Full Q108 Results

Net Income up $6.3 Million and Non-GAAP EPS up 181% from Q107

SAN JOSE, Calif., May 12 /PRNewswire-FirstCall/ -- Monolithic Power Systems (MPS) (NASDAQ:MPWR), a leading fabless manufacturer of high-performance analog and mixed-signal semiconductors, today announced its full quarter results for the first quarter of 2008, ended March 31, 2008. In addition to the previously announced revenue and operating metrics, the company today announced net income of $5.9 million in the first quarter of 2008 compared to a net loss of $0.3 million in the first quarter of 2007 as well as GAAP EPS of $0.17, and Non-GAAP(1) EPS of $0.21.

(1) Non-GAAP EPS differs from EPS determined in accordance with GAAP
(Generally Accepted Accounting Principles in the United States).
Non-GAAP EPS excludes the effect of stock-based compensation expense.
A schedule reconciling these amounts is included in this news release.
Non-GAAP financial measures should not be considered as a substitute
for, or superior to, measures of financial performance prepared in
accordance with GAAP. MPS utilizes both GAAP and non-GAAP financial
measures to assess what it believes to be its core operating
performance and to evaluate and manage its internal business and
assist in making financial operating decisions. MPS believes that the
inclusion of non-GAAP financial measures, together with GAAP measures,
provides investors with an alternative presentation useful to
investors' understanding of MPS' core operating results and trends.
Additionally, MPS believes that the inclusion of non-GAAP measures,
together with GAAP measures, provides investors with an additional
dimension of comparability to similar companies. However, investors
should be aware that non-GAAP financial measures utilized by other
companies are not likely to be comparable in most cases to the
non-GAAP financials measures used by MPS.

The full quarter's results are as follows:

Selected Consolidated Balance Sheet Items
(Unaudited, in thousands)

March 31, December 31,
2008 2007
ASSETS
Current assets:
Cash and cash equivalents $64,300 $83,114
Short-term investments 4,772 27,765
Accounts receivable, net of allowances
of $227 and $227 in 2008 and 2007 11,314 8,239
Inventories 16,390 17,487
Deferred income tax asset-current 74 72
Prepaid expenses and other current assets 4,395 4,733
Restricted cash 7,350 7,350
Total current assets 108,595 148,760
Property and equipment, net 14,880 14,175
Long-term investments 39,140 - Deferred income tax asset-long term 776 776
Other assets 507 539
Restricted assets 8,598 8,340
Total assets $172,496 $172,590

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $7,667 $6,154
Accrued compensation and related benefits 5,465 8,299
Accrued liabilities 14,620 14,959
Total current liabilities 27,752 29,412

Deferred rent 173 237
Non-current income tax liability 5,317 5,318
Other long term liabilities 2 86
Total liabilities 33,244 35,053
Commitments and contingencies (Note 8)
Stockholders' equity:
Common stock, $0.001 par value, $33 and
$33 in 2008 and 2007, respectively; shares
authorized: 150,000,000; shares issued and
outstanding: 33,163,290 and 33,454,595 in
2008 and 2007, respectively 139,365 143,890
Deferred stock compensation - (3)
Accumulated deficit (880) (6,815)
Accumulated other comprehensive income 767 465
Total stockholders' equity 139,252 137,537
Total liabilities and stockholders'
equity $172,496 $172,590

Consolidated Statement of Operations Items
(Unaudited, in thousands)

Three months ended
March 31, 2007
March 31, 2008 (as restated)

Revenue $35,409 $24,496
Cost of revenue* 13,044 8,963

Gross profit 22,365 15,533

Operating expenses:
Research and development* 7,572 5,932
Selling, general and administrative* 8,728 6,197
Provision for litigation expense 736 2,847

Total operating expenses 17,036 14,976

Income from operations 5,329 557
Other income (expense):
Interest and other income 1,434 1,007
Interest and other expense (6) (7)

Total other income, net 1,428 1,000

Income before income taxes 6,757 1,557
Income tax provision 822 1,886

Net income (loss) $5,935 $(329)
Basic net income (loss) per share $0.18 $(0.01)
Diluted net income (loss) per share $0.17 $(0.01)
Weighted average common shares outstanding 33,340 30,482
Stock options 2,551 - Diluted weighted-average common equivalent
shares outstanding 35,891 30,482

*Stock-based compensation has been included
in the following line items:
Cost of revenue $45 $111
Research and development 1,207 1,101
Selling, general and administrative 1,535 1,108
Total $2,787 $2,320

RECONCILIATION OF NET INCOME TO NON-GAAP NET INCOME
(in thousands, except per share amounts)

Net income (loss) $5,935 $(329)

Adjustments to reconcile net income to
non-GAAP net income
Stock-based compensation $2,787 $2,320
Tax effect (1,087) 568
Non-GAAP net income $7,635 $2,559

Non-GAAP earnings per share, excluding
stock-based compensation and related
tax effects:
Basic $0.23 $0.08
Diluted $0.21 $0.08

Shares used in the calculation of non-GAAP
earnings per share:
Basic 33,340 30,482
Diluted 35,891 33,759

RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES
(in thousands, except per share amounts)

Total operating expenses $17,036 $14,976

Adjustments to reconcile total operating
expenses to non-GAAP total operating expenses
Stock-based compensation $(2,742) $(2,209)
Non-GAAP total operating expenses $14,294 $12,767

About Monolithic Power Systems, Inc.

Monolithic Power Systems, Inc. (MPS) develops and markets proprietary, advanced analog and mixed-signal semiconductors. The company combines advanced process technology with its highly experienced analog designers to produce high-performance power management integrated circuits (ICs) for DC to DC converters, LED drivers, Cold Cathode Fluorescent Lamp (CCFL) backlight controllers, Class D audio amplifiers, and Linear ICs. MPS products are used extensively in computing and network communications products, LCD monitors and TVs, and a wide variety of consumer and portable electronics products. MPS partners with world-class manufacturing organizations to deliver top quality, ultra-compact, high-performance solutions through the most productive, cost-efficient channels. Founded in 1997 and headquartered in San Jose, California, the company has expanded its global presence with sales offices in Taiwan, China, Korea, Japan, and Europe, which operate under MPS International, Ltd.

Monolithic Power Systems, MPS, and the MPS logo are registered trademarks of Monolithic Power Systems, Inc. in the U.S. and trademarked in certain other countries.

First Call Analyst:
FCMN Contact:

Source: Monolithic Power Systems, Inc.

CONTACT: Rick Neely, Chief Financial Officer of Monolithic Power
Systems, Inc., +1-408-826-0777, investors@monolithicpower.com

Web site: http://www.monolithicpower.com/

2008-05-12 18:01:43 0359401 PRNEWSWIRE