Anadigics Up the Game with 58.6% Increase in Sales

Anadigics, a leading provider of semiconductor solutions in the broadband wireless and wireline communications markets, reported third quarter 2010 net sales of $61.3 million. This represents a sequential increase of 18.6% and an increase of 67% above the third quarter of 2009. For the nine months ended October 2, 2010, net sales were $156.5 million, up approximately 58.6% over the prior year.

As of October 2, 2010, cash, cash equivalents and short and long-term marketable securities totaled $96 million, up sequentially by $4.2 million. GAAP net income for the third quarter of 2010 was $2.3 million, or $0.03 per share compared with a GAAP loss of $12.9 million or $0.21 per share in the year-ago quarter. Mario Rivas, President & CEO, commented, "The strong revenue achieved in the third quarter of 18.6% sequential growth, which was higher than our previous guidance of 11% sequential growth, reflects our increased 3G market share position within our wireless customer base and the positive traction and market share gains realized in both WiMax and cable infrastructure within Broadband.” “Specifically, Wireless and Broadband grew sequentially by 18.1% and 20%, respectively. We believe that the third quarter benefited from stronger order pull in both Wireless and Broadband ahead of the typical fourth quarter holiday trade season, which will affect the revenue in our fourth quarter.” "Looking into 2011, we are very excited about our new product design portfolio for 3G, 4G / LTE and Multi Mode Multi Band (MMMB) and several design engagements with chipset providers and Tier I OEMs. In particular, we officially signed a Cooperation Agreement with a new reference design partner, initiated design activities with another new reference design partner and increased design activities with an existing reference design partner. Enhancing our business prospects longer term, we also completed negotiations on a Product Purchase Agreement with one of the larger Tier I OEMs. With the industry's strong 3G unit growth forecasted next year in wireless handsets, we expect 2011 to be another positive year for our Company.” "In Broadband, we have a line up of new products addressing market drivers in DOCSIS 3.0 enabled devices, cable modems, CATV subscriber home gateways, hybrid line amplifiers and 75-Ohn Gain Blocks for CATV infrastructure, mobile WiMax enabled devices and small-cell Wireless infrastructure for 3G and 4G coverage including Picocells and Femtocells, which positions the Company well in 2011.” "Financially the stronger revenue in the third quarter and operating leverage in our business provided for a healthy increase in earnings, which contributed to a $3.3 million or $0.04 sequential improvement in Non-GAAP earnings per share. At the same time, we generated cash flow from operations of $5.0 million in the third quarter, contributing to our existing balance in cash, cash equivalents and short and long-term marketable securities of $96 million. Delivering on four key financial metrics – sales growth, margin expansion, earnings per share and cash generation, was especially satisfying and remains a primary focus of the Company." In regard to the fourth quarter 2010, Tom Shields, Executive VP and CFO, commented, "With our past practice of providing revenue guidance equal to our existing order backlog, we are expecting revenue of approximately $57 million. We believe this reflects a pause in orders, caused by inventory rebalancing, by our Broadband customers following the robust 20% sequential growth reported in the third quarter and shortened order lead times by Wireless customers, particularly in Korea and China, attributable to the solid order pull in the third quarter. While Broadband revenue could decline sequentially by approximately 25%, this is viewed as temporary given the typical fourth quarter seasonality evidenced in our business in prior years. Our current backlog for Wireless is equal to the Wireless revenue reported in the third quarter, but higher than historical fill levels. "Sequentially, we expect slightly higher gross margin and lower operating expenses, with both GAAP and Non-GAAP earnings per share in the fourth quarter to approximate third quarter levels of $0.03 and $0.06, respectively. We also expect to exit the year above $100 million in cash, cash equivalents and short and long-term marketable securities on anticipated positive cash generation in the fourth quarter." Anadigics’ senior management will conduct a conference call today at 8:30 AM Eastern Time. A live audio Webcast will be available at www.anadigics.com/investors. A recording of the call will be available approximately two hours after the end of the call on the Anadigics Web site or by dialing (800) 642-1687 conference ID 17709482 (available until November 8, 2010).