Earnings Labs

Lattice Semiconductor Corporation (LSCC)

Q4 2008 Earnings Call· Mon, Feb 9, 2009

$114.27

+0.31%

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Transcript

Operator

Operator

Good evening. My name is Kara and I will be your conference operator today. At this time, I would like to welcome everyone to the Lattice Semiconductor fourth quarter 2008 conference call. (Operator Instructions) I would now like to turn the call over to Rob O’Brien, Interim Chief Financial Officer. Sir, you may begin. Robert W. O’Brien, Jr.: Thank you and good afternoon, everyone. This is Rob O’Brien. Joining me on the call today is Bruno Guilmart, President and CEO. Before we begin, I’d like to read a safe harbor statement and then give a financial review of the fourth quarter. After that, Bruno will provide a business review followed by our first quarter 2009 business outlook. We’ll then hold a question and answer session. I’ll now begin by reading the safe harbor statement. It is our intention that this call will comply with the requirements of SEC Regulation FD. This call includes and constitutes the company’s official guidance for the first quarter of fiscal 2009. If at any time after this call, we communicate any material changes to this guidance, we intend that such updates will be done using a public forum such as a press release or publically announced conference call. The matters that we discuss today other than historical information include forward-looking statements related to our future financial performance and other performance expectations. Investors are cautioned that forward-looking statements are neither promises, nor guarantees that involve risks and uncertainties that may cause actual results to differ materially from those projected in the forward-looking statements. Some of those risks and uncertainties are detailed in our filings with the Securities and Exchange Commission including our fiscal year 2008 Form 10-K filed in March of 2008 and our quarterly report on Form 10-Q. The company disclaims any obligation to publically…

Bruno Guilmart

President and CEO

Thank you, Rob. It is clear that we are in very challenging times, not just for the year, or the semiconductor industry, but for the entire world wide economy. In the midst of uncertainty, I am pleased by both Lattice Semiconductor’s credit position and our ability to manage our cash flow even in this difficult revenue environment. Our strong balance sheet has given us the ability to ascertain different ways of increasing shareholder value. For example, last quarter, we announced that our Board of Directors had authorized a $20 million share buyback program. We’re also ready to focus on optimizing our supply chain. Our analysis has found several ways to bolster costs of the supply chain and simultaneously increase our commitment to our customers. The dedication by our product operations team has been well and we initially announced last year to reorganize our business to better reflect our strategy going forward and achieve greater efficiencies. Let me give you a quick update on some of those initiatives. Our high-density team is finishing the work that will focus them on specific vertical markets where we believe our different shared technology strengths will leave us in a favorable position going forward. Our low-density and mixing-up team is working to increase sales through deeper partnerships with our sales channels and is also developing a product roadmap that will re-assert our commitment to markets where we have historic strengths and leadership positions. Our R&D team and our global centers of excellence are leading a rhythm of functions and focusing on the development of the most efficient and profitable accounts. Let me now give you some more color on our business this quarter. There were no material changes between any market segments on a sequential basis this quarter indicating to us that the softness we…

Operator

Operator

(Operator Instructions) At this time, I am not showing any questions. You may proceed with your presentation and any closing remarks. We do have a question from the line of Dan Berkley with O’Conner. Dan Berkley - O’Conner: What’s the timing during the second and fourth quarter of the Fujitsu receivables and what was the thought process on taking in the second and fourth quarter?

Bruno Guilmart

President and CEO

The timing was early in the second and fourth quarter, roughly in the April and October time frame. The rationale for holding back a portion, by the way, of that money was it was a better use of cash going forward, at the same time, maintaining strategic relationships with Fujitsu as our sole source for all of our advanced technologies. Dan Berkley - O’Conner: So making some assumptions on high levels of burn, you could have over $50 million of cash or I’m sorry, 30 plus the 50, $80 million of cash sometime in the middle of the June quarter, what are the priority uses of cash?

Bruno Guilmart

President and CEO

As you have probably also seen, we’ve announced our share buyback program for $20 million in December. So as we move forward, we may use some of that cash for that purpose, but the bottom line is given the current environments, we believe having a strong balance sheet is critical and we want to keep flexibility going forward with having plenty of cash given the current environment that we’re in. Dan Berkley - O’Conner: I assume if it wasn’t in the press release you didn’t buy back any stock in the December quarter.

Bruno Guilmart

President and CEO

No, we did not.

Operator

Operator

(Operator Instructions) There are no questions at this time, sir.

Bruno Guilmart

President and CEO

Okay. That concludes the call. Thank you, everybody.