ARM Holdings plc (ARM Holdings) has reported revenues of GBP298.9 million for the year-end 2008, compared with the revenues of GBP259.2 million in the previous year-end. It has also reported an income before income tax of GBP64.8 million for the year-end 2008, compared with the income before income tax of GBP48.2 million in the previous year-end.
Fourth Quarter Financial Highlights (US GAAP unless otherwise stated):
Fourth quarter 2008 revenues at $149.4m, up 15% year-on-year (GBP94.4m, up 47%);
Normalized operating margin at 34.6% (US GAAP 24.2%);
Normalized PBT at GBP33.4m, up 57% (US GAAP GBP23.6m, up 105%);
Normalized EPS at 1.93p, up 54% (US GAAP 1.38p, up 86%);
GBP29.6m cash generated in the quarter.
Outlook:
Semiconductor industry activity slowed down markedly in the fourth quarter and the near-term outlook for the sector remains uncertain. Whilst not immune from the impact of the industry slow down, the company continues to build an established base of licenses that drives long-term royalty growth. The current licensing opportunity pipeline to enlarge that base further remains robust.
Although there is less visibility than usual at this time of the year, we believe that ARM is positioned to perform resiliently in the context of the challenging trading environment. Unless conditions deteriorate to a greater extent than generally anticipated, we expect group dollar revenues for full-year 2009 to be at least in line with current market expectations of around $460 million.
Warren East, chief executive officer, said: We are pleased to see ARM technology being increasingly utilised in innovative consumer electronics products, leading to the highest ever group revenues for both the fourth quarter and for the full year.
We saw strong demand for new ARM technology, with industry leaders continuing to license our latest generation processors and physical IP. ARM has built a base of more than 580 processor licenses that is driving long-term royalty growth.
We are encouraged to see that the inherent operating leverage in the ARM business model, combined with sound financial discipline and the recent strengthening of the dollar against sterling, has given rise to earnings growth in 2008 of more than 20%.
Fourth Quarter Operational Highlights:
Processor Division (PD): Strong licensing base driving royalty momentum;
Base of licenses increased to 587 with 21 additional processor licenses signed in fourth quarter;
Three Cortex-A9 licenses to tier 1 semiconductor companies for mobile computing and gaming;
Fourth quarter mobile unit shipments grew approximately 35% to more than 750 million units;
Fourth quarter non-mobile unit shipments grew approximately 70% to 450 million units;
Physical IP Division (PIPD): Licensing advanced technology nodes to IDMs and foundries;
12 companies licensed physical IP in fourth quarter, 7 at advanced nodes, including 32nm;
Backlog grew more than 5% sequentially, whilst PIPD license revenue declined 6% quarter-on-quarter.