STMicroelectronics Reports Q4 and FY 2019 Financial Results
- Q4 net revenues $2.75 billion; gross margin 39.3%;
operating margin 16.7%; net income $392 million
- FY net revenues $9.56 billion; gross margin 38.7%;
operating margin 12.6%; net income $1,032 million
- Business outlook at mid-point: Q1 net revenues of $2.36
billion and gross margin of 38.0%
Geneva, January 23, 2020 -
STMicroelectronics (NYSE: STM), a global semiconductor
leader serving customers across the spectrum of electronics
applications, reported U.S. GAAP financial results for the fourth
quarter ended December 31, 2019. This press release also contains
non-U.S. GAAP measures (see Appendix for additional
information).
ST reported fourth quarter net revenues of $2.75
billion, gross margin of 39.3%, operating margin of 16.7%, and net
income of $392 million or $0.43 diluted earnings per share.
Jean-Marc Chery, STMicroelectronics President
& CEO, commented:
- “We closed 2019 with a solid fourth quarter sales and
financial performance. Net revenues grew 7.9% sequentially, above
the mid-point of our guidance of 5.0%, with all product groups
contributing to the growth. Our gross margin was 39.3%, 110 basis
points higher than the mid-point of our guidance, mainly due to
better than expected manufacturing efficiencies and improved
product mix. On a sequential basis, our operating margin was up 360
basis points to 16.7% and free cash flow increased to $461 million
in the fourth quarter.
- “Our 2019 financial performance, with net revenues of
$9.56 billion and an operating margin of 12.6%, is aligned with the
full year expectations we provided in April 2019.
- “ST’s first quarter outlook, at the mid-point, is for
net revenues of $2.36 billion, increasing year-over-year by 13.7%
and decreasing sequentially by 14.3%; gross margin is expected to
be 38.0%, including about 80 basis points of unsaturation
charges.
- “For 2020, we plan to invest about $1.5 billion in
CAPEX to support our strategic initiatives and revenue growth to
progress towards our mid-term revenue ambition of $12
billion.”
Quarterly Financial Summary (U.S. GAAP)
(US$ m, except per share data) |
Q4 2019 |
Q3 2019 |
Q4 2018 |
Q/Q |
Y/Y |
Net Revenues |
$2,754 |
$2,553 |
$2,648 |
7.9% |
4.0% |
Gross Profit |
$1,081 |
$967 |
$1,059 |
11.8% |
2.0% |
Gross Margin |
39.3% |
37.9% |
40.0% |
140 bps |
(70) bps |
Operating Income |
$460 |
$336 |
$443 |
37.1% |
3.7% |
Operating Margin |
16.7% |
13.1% |
16.8% |
360 bps |
(10) bps |
Net Income |
$392 |
$302 |
$418 |
29.9% |
(6.2)% |
Diluted Earnings Per Share |
$0.43 |
$0.34 |
$0.46 |
26.5% |
(6.5)% |
Annual Financial Summary (U.S. GAAP)
(US$ m, except earnings per share data) |
FY2019 |
FY2018 |
Y/Y |
Net Revenues |
$9,556 |
$9,664 |
(1.1)% |
Gross Profit |
$3,696 |
$3,861 |
(4.3)% |
Gross Margin |
38.7% |
40.0% |
(130) bps |
Operating Income |
$1,203 |
$1,400 |
(14.0)% |
Operating Margin |
12.6% |
14.5% |
(190) bps |
Net Income |
$1,032 |
$1,287 |
(19.8)% |
Diluted Earnings Per Share |
$1.14 |
$1.41 |
(19.1)% |
Fourth Quarter 2019 Summary Review
Net Revenues By Product Group (US$ m) |
Q4 2019 |
Q3 2019 |
Q4 2018 |
Q/Q |
Y/Y |
Automotive and Discrete Group (ADG) |
924 |
894 |
967 |
3.3% |
(4.5)% |
Analog, MEMS and Sensors Group (AMS) |
1,085 |
968 |
988 |
12.1% |
9.9% |
Microcontrollers and Digital ICs Group (MDG) |
742 |
688 |
689 |
7.9% |
7.6% |
Others |
3 |
3 |
4 |
- |
- |
Total Net Revenues |
2,754 |
2,553 |
2,648 |
7.9% |
4.0% |
Net revenues totaled $2.75
billion. On a sequential basis, revenues increased 7.9%, 290 basis
points better than the mid-point of the Company’s guidance. On a
year-over-year basis, fourth quarter net revenues increased 4.0% as
the Company recorded higher sales in Analog, Microcontrollers,
Imaging and MEMS partially offset by lower Automotive sales. On a
year-over-year basis, sales to OEMs increased 8.9%, while
Distribution decreased 6.9%.
Gross profit totaled $1.08
billion, representing a year-over-year increase of 2.0%.
Gross margin of 39.3% decreased 70 basis points
year-over-year, mainly impacted by price pressure and unsaturation
charges. Fourth quarter gross margin was 110 basis points higher
than the mid-point of the Company’s guidance, mainly due to better
than expected manufacturing efficiencies and improved product mix.
Fourth quarter gross margin included about 100 basis points of
unsaturation charges.
Operating income increased 3.7%
to $460 million, compared to $443 million in the year-ago quarter.
The Company’s operating margin decreased 10 basis
points on a year-over-year basis to 16.7% of net revenues, compared
to 16.8% in the 2018 fourth quarter.
By product group, compared with
the year-ago quarter:
Automotive and Discrete Group (ADG):
- Revenue decreased in both Automotive and Power Discrete.
- Operating profit decreased by 19.9% to $113 million. Operating
margin was 12.2% compared to 14.6%.
Analog, MEMS and Sensors Group (AMS):
- Revenue increased in Analog, Imaging and MEMS.
- Operating profit increased by 39.1% to $281 million. Operating
margin was 25.9% compared to 20.5%.
Microcontrollers and Digital ICs Group
(MDG):
- Revenue increased in Microcontrollers and was substantially
flat in Digital ICs.
- Operating profit decreased by 2.5% to $119 million. Operating
margin was 16.0% compared to 17.7%.
Net income and diluted
earnings per share decreased to $392 million and $0.43,
respectively, compared to $418 million and $0.46, respectively, in
the year-ago quarter.
Cash Flow and Balance Sheet Highlights
|
|
|
|
Trailing 12 Months |
(US$ m) |
Q4 2019 |
Q3 2019 |
Q4 2018 |
Q4 2019 |
Q4 2018 |
TTM Change |
Net cash from operating activities |
775 |
429 |
656 |
1,869 |
1,845 |
1.3% |
Free cash flow (non-U.S. GAAP) |
461 |
170 |
363 |
497 |
533 |
(6.8)% |
Capital expenditure payments, net of proceeds
from sales, were $236 million in the fourth quarter and $1.17
billion for 2019. In the year-ago quarter, capital expenditures,
net, were $279 million.
Inventory at the end of the fourth quarter was
$1.69 billion, down from $1.79 billion in the prior quarter. Day
sales of inventory at quarter-end was 90 days compared to 100 days
in the prior quarter.
Free cash flow (non-U.S. GAAP) was $461 million
in the fourth quarter and $497 million for 2019.
The Company paid cash dividends totaling $53
million in the fourth quarter and $214 million for 2019. In
addition, ST executed a $63 million and $250 million share buy-back
in the fourth quarter and full year, respectively, as part of its
previously announced share repurchase program.
ST’s net financial position (non-U.S. GAAP) was
$672 million at December 31, 2019 compared to $348 million at
September 28, 2019 and reflected total liquidity of $2.74 billion
and total financial debt of $2.07 billion.
Business Outlook
The Company’s guidance, at the mid-point, for
the 2020 first quarter is:
- Net revenues are expected to be $2.36 billion, a decrease of
14.3% sequentially, plus or minus 350 basis points;
- Gross margin of 38.0%, plus or minus 200 basis points;
- This outlook is based on an assumed effective currency exchange
rate of approximately $1.12 = €1.00 for the 2020 first quarter and
includes the impact of existing hedging contracts;
- The first quarter will close on March 28, 2020.
Recent Corporate
Developments
- On December 2, 2019, ST announced the closing of the full
acquisition of Swedish silicon carbide (SiC) wafer manufacturer
Norstel AB (“Norstel”). ST exercised its option to acquire the
remaining 45% stake, following the initial
transaction announced in February 2019. The total
consideration for the acquisition of Norstel was $137.5 million,
funded with available cash.
- In December 2019, Philippe Brun, President, Human
Resources and Corporate Social Responsibility, left the
Company.
Conference Call and Webcast Information
STMicroelectronics will conduct a conference
call with analysts, investors and reporters to discuss its fourth
quarter 2019 financial results and current business outlook today
at 9:30 a.m. Central European Time (CET) / 3:30 a.m. U.S. Eastern
Time (ET). A live webcast (listen-only mode) of the conference call
will be accessible at ST’s website, http://investors.st.com, and
will be available for replay until February 7, 2020.
Use of Supplemental Non-U.S. GAAP Financial
Information
This press release contains supplemental
non-U.S. GAAP financial information.
Readers are cautioned that these measures are
unaudited and not prepared in accordance with U.S. GAAP and should
not be considered as a substitute for U.S. GAAP financial measures.
In addition, such non-U.S. GAAP financial measures may not be
comparable to similarly titled information from other
companies.
See the Appendix of this press release for a
reconciliation of the Company’s non-U.S. GAAP financial measures to
their corresponding U.S. GAAP financial measures. To compensate for
these limitations, the supplemental non-U.S. GAAP financial
information should not be read in isolation, but only in
conjunction with the Company’s consolidated financial statements
prepared in accordance with U.S. GAAP.
Forward-looking Information
Some of the statements contained in this release
that are not historical facts are statements of future expectations
and other forward-looking statements (within the meaning of Section
27A of the Securities Act of 1933 or Section 21E of the Securities
Exchange Act of 1934, each as amended) that are based on
management’s current views and assumptions, and are conditioned
upon and also involve known and unknown risks and uncertainties
that could cause actual results, performance, or events to differ
materially from those anticipated by such statements, due to, among
other factors:
- Changes in global trade policies, including the adoption and
expansion of tariffs and trade barriers, that could affect the
macro-economic environment and adversely impact the demand for our
products;
- Uncertain macro-economic and industry trends, which may impact
end-market demand for our products;
- The Brexit vote and impact of the withdrawal of the U.K. may
adversely affect business activity, political stability and
economic conditions in the U.K., the Eurozone, the EU and
elsewhere. The date set for the U.K. withdrawal from the EU is
January 31, 2020 and the U.K. majority government is expected to
complete Brexit even if no formal withdrawal agreement is in place
with the EU by the end of the transition period running until
December 31, 2020. The specific terms of the U.K. withdrawal from
the EU are still uncertain and while we do not have material
operations in the U.K. and have not experienced any material impact
from Brexit on our underlying business to date, we cannot predict
its future implications;
- Customer demand that differs from projections;
- The ability to design, manufacture and sell innovative products
in a rapidly changing technological environment;
- Changes in economic, social, labor, political, or
infrastructure conditions in the locations where we, our customers,
or our suppliers operate, including as a result of macro-economic
or regional events, military conflicts, social unrest, labor
actions, or terrorist activities;
- Unanticipated events or circumstances, which may impact our
ability to execute our plans and/or meet the objectives of our
R&D and manufacturing programs, which benefit from public
funding;
- Financial difficulties with any of our major distributors or
significant curtailment of purchases by key customers;
- The loading, product mix, and manufacturing performance of our
production facilities and/or our required volume to fulfill
capacity reserved with suppliers or third party manufacturing
providers;
- Availability and costs of equipment, raw materials, utilities,
third-party manufacturing services and technology, or other
supplies required by our operations;
- The functionalities and performance of our IT systems, which
are subject to cybersecurity threats and which support our critical
operational activities including manufacturing, finance and sales,
and any breaches of our IT systems or those of our customers or
suppliers;
- Theft, loss, or misuse of personal data about our employees,
customers, or other third parties, and breaches of global and local
privacy legislation, including the EU’s General Data Protection
Regulation (“GDPR”);
- The impact of intellectual property (“IP”) claims by our
competitors or other third parties, and our ability to obtain
required licenses on reasonable terms and conditions;
- Changes in our overall tax position as a result of changes in
tax rules, new or revised legislation, the outcome of tax audits or
changes in international tax treaties which may impact our results
of operations as well as our ability to accurately estimate tax
credits, benefits, deductions and provisions and to realize
deferred tax assets;
- Variations in the foreign exchange markets and, more
particularly, the U.S. dollar exchange rate as compared to the Euro
and the other major currencies we use for our operations;
- The outcome of ongoing litigation as well as the impact of any
new litigation to which we may become a defendant;
- Product liability or warranty claims, claims based on epidemic
or delivery failure, or other claims relating to our products, or
recalls by our customers for products containing our parts;
- Natural events such as severe weather, earthquakes, tsunamis,
volcano eruptions or other acts of nature, health risks and
epidemics in locations where we, our customers or our suppliers
operate;
- Industry changes resulting from vertical and horizontal
consolidation among our suppliers, competitors, and customers;
and
- The ability to successfully ramp up new programs that could be
impacted by factors beyond our control, including the availability
of critical third party components and performance of
subcontractors in line with our expectations.
Such forward-looking statements are subject to
various risks and uncertainties, which may cause actual results and
performance of our business to differ materially and adversely from
the forward-looking statements. Certain forward-looking statements
can be identified by the use of forward looking terminology, such
as “believes,” “expects,” “may,” “are expected to,” “should,”
“would be,” “seeks” or “anticipates” or similar expressions or the
negative thereof or other variations thereof or comparable
terminology, or by discussions of strategy, plans or
intentions.
Some of these risk factors are set forth and are
discussed in more detail in “Item 3. Key Information — Risk
Factors” included in our Annual Report on Form 20-F for the year
ended December 31, 2018, as filed with the SEC on February 28,
2019. Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described in this
release as anticipated, believed, or expected. We do not intend,
and do not assume any obligation, to update any industry
information or forward-looking statements set forth in this release
to reflect subsequent events or circumstances.
About STMicroelectronics
ST is a global semiconductor leader delivering
intelligent and energy-efficient products and solutions that power
the electronics at the heart of everyday life. ST’s products are
found everywhere today, and together with our customers, we are
enabling smarter driving and smarter factories, cities and homes,
along with the next generation of mobile and Internet of Things
devices.
By getting more from technology to get more from
life, ST stands for life.augmented.
In 2019, the Company’s net revenues were $9.56
billion, serving more than 100,000 customers worldwide.
Further information can be found at
www.st.com.
For further information, please contact:
INVESTOR RELATIONS:Céline BerthierGroup VP,
Investor RelationsTel: +41 22 929 58 12celine.berthier@st.com
MEDIA RELATIONS:Alexis
Breton
Corporate External CommunicationsSTMicroelectronics Tel: +
33 6 59 16 79 08 alexis.breton@st.com
STMicroelectronics N.V. |
|
|
CONSOLIDATED STATEMENTS OF INCOME |
|
|
(in millions of U.S. dollars, except per share data
($)) |
|
|
|
|
|
|
Three months ended |
|
December 31, |
December 31, |
|
2019 |
2018 |
|
(Unaudited) |
(Unaudited) |
|
|
|
Net sales |
2,750 |
2,633 |
Other revenues |
4 |
15 |
NET REVENUES |
2,754 |
2,648 |
Cost of sales |
(1,673) |
(1,589) |
GROSS PROFIT |
1,081 |
1,059 |
Selling, general and administrative |
(285) |
(285) |
Research and development |
(387) |
(345) |
Other income and expenses, net |
54 |
16 |
Impairment, restructuring charges and other related closure
costs |
(3) |
(2) |
Total operating expenses |
(621) |
(616) |
OPERATING INCOME |
460 |
443 |
Interest income (expense), net |
(1) |
1 |
Other components of pension benefit costs |
(4) |
(2) |
Income (loss) on equity-method investments |
- |
6 |
Loss on financial instruments, net |
- |
(1) |
INCOME BEFORE INCOME TAXES AND NONCONTROLLING
INTEREST |
455 |
447 |
Income tax expense |
(62) |
(28) |
NET INCOME |
393 |
419 |
Net income attributable to noncontrolling interest |
(1) |
(1) |
NET INCOME ATTRIBUTABLE TO PARENT COMPANY |
392 |
418 |
|
|
|
EARNINGS PER SHARE (BASIC) ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
0.44 |
0.46 |
EARNINGS PER SHARE (DILUTED) ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
0.43 |
0.46 |
|
|
|
NUMBER OF WEIGHTED AVERAGE SHARES USED IN CALCULATING
DILUTED EPS |
910.0 |
905.5 |
|
|
|
STMicroelectronics N.V. |
|
|
CONSOLIDATED STATEMENTS OF INCOME |
|
|
(in millions of U.S. dollars, except per share data
($)) |
|
|
|
|
|
|
Twelve months ended |
|
December 31, |
December 31, |
|
2019 |
2018 |
|
(Unaudited) |
(Audited) |
|
|
|
Net sales |
9,529 |
9,612 |
Other revenues |
27 |
52 |
NET REVENUES |
9,556 |
9,664 |
Cost of sales |
(5,860) |
(5,803) |
GROSS PROFIT |
3,696 |
3,861 |
Selling, general and administrative |
(1,093) |
(1,095) |
Research and development |
(1,498) |
(1,398) |
Other income and expenses, net |
103 |
53 |
Impairment, restructuring charges and other related closure
costs |
(5) |
(21) |
Total operating expenses |
(2,493) |
(2,461) |
OPERATING INCOME |
1,203 |
1,400 |
Interest income (expense), net |
1 |
(7) |
Other components of pension benefit costs |
(16) |
(11) |
Income (loss) on equity-method investments |
1 |
8 |
Loss on financial instruments, net |
- |
(1) |
INCOME BEFORE INCOME TAXES AND NONCONTROLLING
INTEREST |
1,189 |
1,389 |
Income tax expense |
(156) |
(96) |
NET INCOME |
1,033 |
1,293 |
Net income attributable to noncontrolling interest |
(1) |
(6) |
NET INCOME ATTRIBUTABLE TO PARENT COMPANY |
1,032 |
1,287 |
|
|
|
EARNINGS PER SHARE (BASIC) ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
1.15 |
1.43 |
EARNINGS PER SHARE (DILUTED) ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
1.14 |
1.41 |
|
|
|
NUMBER OF WEIGHTED AVERAGE SHARES USED IN CALCULATING
DILUTED EPS |
903.6 |
911.0 |
|
|
|
|
|
|
|
STMicroelectronics N.V. |
|
|
|
CONSOLIDATED BALANCE SHEETS |
|
|
|
As at |
December 31, |
September 28, |
December 31, |
In millions of U.S. dollars |
2019 |
2019 |
2018 |
|
(Unaudited) |
(Unaudited) |
(Audited) |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
2,597 |
2,345 |
2,266 |
Restricted cash |
10 |
60 |
- |
Short-term deposits |
4 |
- |
- |
Marketable securities |
133 |
133 |
330 |
Trade accounts receivable, net |
1,380 |
1,388 |
1,277 |
Inventories |
1,691 |
1,785 |
1,562 |
Other current assets |
442 |
415 |
419 |
Total current assets |
6,257 |
6,126 |
5,854 |
Goodwill |
162 |
161 |
121 |
Other intangible assets, net |
299 |
291 |
212 |
Property, plant and equipment, net |
4,007 |
3,897 |
3,495 |
Non-current deferred tax assets |
695 |
684 |
672 |
Long-term investments |
11 |
62 |
61 |
Other non-current assets |
437 |
401 |
452 |
|
5,611 |
5,496 |
5,013 |
Total assets |
11,868 |
11,622 |
10,867 |
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current liabilities: |
|
|
|
Short-term debt |
173 |
171 |
146 |
Trade accounts payable |
950 |
915 |
981 |
Other payables and accrued liabilities |
831 |
857 |
874 |
Dividends payable to stockholders |
58 |
112 |
60 |
Accrued income tax |
52 |
77 |
59 |
Total current liabilities |
2,064 |
2,132 |
2,120 |
Long-term debt |
1,899 |
2,019 |
1,764 |
Post-employment benefit obligations |
445 |
386 |
385 |
Long-term deferred tax liabilities |
19 |
18 |
14 |
Other long-term liabilities |
330 |
315 |
160 |
|
2,693 |
2,738 |
2,323 |
Total liabilities |
4,757 |
4,870 |
4,443 |
Commitment and contingencies |
|
|
|
Equity |
|
|
|
Parent company stockholders' equity |
|
|
|
Common stock (preferred stock: 540,000,000 shares authorized, not
issued; common stock: Euro 1.04 nominal value, 1,200,000,000 shares
authorized, 911,186,920 shares issued, 891,434,489 shares
outstanding) |
1,157 |
1,157 |
1,157 |
Capital surplus |
2,992 |
2,950 |
2,843 |
Retained earnings |
2,747 |
2,355 |
1,991 |
Accumulated other comprehensive income |
475 |
422 |
509 |
Treasury stock |
(328) |
(266) |
(141) |
Total parent company stockholders' equity |
7,043 |
6,618 |
6,359 |
Noncontrolling interest |
68 |
134 |
65 |
Total equity |
7,111 |
6,752 |
6,424 |
Total liabilities and equity |
11,868 |
11,622 |
10,867 |
|
|
|
|
|
|
|
|
STMicroelectronics N.V. |
|
|
|
|
|
|
|
SELECTED CASH FLOW DATA |
|
|
|
|
|
|
|
Cash Flow Data (in US$ millions) |
Q4 2019 |
Q3 2019 |
Q4 2018 |
|
|
|
|
Net Cash from operating activities |
775 |
429 |
656 |
Net Cash used in investing activities |
(314) |
(59) |
(284) |
Net Cash from (used in) financing activities |
(264) |
(129) |
60 |
Net Cash increase |
202 |
226 |
431 |
|
|
|
|
Selected Cash Flow Data (in US$ millions) |
Q4 2019 |
Q3 2019 |
Q4 2018 |
|
|
|
|
Depreciation & amortization |
220 |
216 |
212 |
Net payment for Capital expenditures |
(236) |
(244) |
(279) |
Dividends paid to stockholders |
(53) |
(54) |
(54) |
Change in inventories, net |
112 |
77 |
18 |
|
|
|
|
AppendixSTMicroelectronicsSupplemental
Financial Information
|
Q4 2019 |
Q3 2019 |
Q2 2019 |
Q1 2019 |
Q4 2018 |
FY 2019 |
FY 2018 |
Net Revenues By Market Channel
(%) |
|
|
|
|
|
|
|
Total OEM |
72% |
72% |
70% |
66% |
69% |
70% |
65% |
Distribution |
28% |
28% |
30% |
34% |
31% |
30% |
35% |
|
|
|
|
|
|
|
|
€/$ Effective Rate |
1.12 |
1.14 |
1.14 |
1.16 |
1.17 |
1.14 |
1.18 |
|
|
|
|
|
|
|
|
Product Group Data (US$ m) |
|
|
|
|
|
|
|
Automotive & Discrete Group (ADG) |
|
|
|
|
|
|
|
- Net Revenues |
924 |
894 |
885 |
903 |
967 |
3,606 |
3,556 |
- Operating Income |
113 |
76 |
73 |
95 |
141 |
357 |
431 |
Analog, MEMS & Sensors Group (AMS) |
|
|
|
|
|
|
|
- Net Revenues |
1,085 |
968 |
694 |
552 |
988 |
3,299 |
3,154 |
- Operating Income |
281 |
198 |
74 |
43 |
202 |
596 |
488 |
Microcontrollers & Digital ICs Group
(MDG) |
|
|
|
|
|
|
|
- Net Revenues |
742 |
688 |
591 |
617 |
689 |
2,638 |
2,940 |
- Operating Income |
119 |
108 |
45 |
83 |
122 |
354 |
547 |
Others (a) |
|
|
|
|
|
|
|
- Net Revenues |
3 |
3 |
3 |
4 |
4 |
13 |
14 |
- Operating Income (Loss) |
(53) |
(46) |
4 |
(10) |
(22) |
(104) |
(66) |
Total |
|
|
|
|
|
|
|
- Net Revenues |
2,754 |
2,553 |
2,173 |
2,076 |
2,648 |
9,556 |
9,664 |
- Operating Income |
460 |
336 |
196 |
211 |
443 |
1,203 |
1,400 |
(a) Net revenues of Others includes revenues from sales
assembly services and other revenue. Operating income (loss) of
Others includes items such as unused capacity charges, impairment,
restructuring charges and other related closure costs, management
reorganization costs, phase out and start-up costs, and other
unallocated expenses such as: strategic or special research and
development programs, certain corporate-level operating expenses,
patent claims and litigations, and other costs that are not
allocated to product groups, as well as operating earnings of other
products. Others includes: |
(US$ m) |
Q4 2019 |
Q3 2019 |
Q2 2019 |
Q1 2019 |
Q4 2018 |
FY 2019 |
FY 2018 |
Unused Capacity Charges |
29 |
28 |
7 |
1 |
- |
65 |
1 |
Impairment & Restructuring Charges |
3 |
- |
2 |
- |
2 |
5 |
21 |
(Appendix –
continued)STMicroelectronicsSupplemental
Non-U.S. GAAP Financial InformationU. S. GAAP –
Non-U.S. GAAP Reconciliation
The supplemental non-U.S. GAAP information
presented in this press release is unaudited and subject to
inherent limitations. Such non-U.S. GAAP information is not based
on any comprehensive set of accounting rules or principles and
should not be considered as a substitute for U.S. GAAP
measurements. Also, our supplemental non-U.S. GAAP financial
information may not be comparable to similarly titled non-U.S. GAAP
measures used by other companies. Further, specific limitations for
individual non-U.S. GAAP measures, and the reasons for presenting
non-U.S. GAAP financial information, are set forth in the
paragraphs below. To compensate for these limitations, the
supplemental non-U.S. GAAP financial information should not be read
in isolation, but only in conjunction with our consolidated
financial statements prepared in accordance with U.S. GAAP.
Non-U.S. GAAP net earnings and earnings per
share (EPS) are used by management to help enhance an understanding
of ongoing operations and to communicate the impact of the excluded
items such as impairment, restructuring charges and other related
closure costs attributable to ST and other one-time items, and
their related estimated income tax effect.
The Company believes that these non-U.S. GAAP
financial measures provide useful information for investors and
management because they measure the Company’s capacity to generate
profits from its business operations, excluding the effect of
acquisitions and expenses related to the rationalizing of its
activities and sites that it does not consider to be part of its
on-going operating results, thereby offering, when read in
conjunction with the Company’s U.S. GAAP financials, (i) the
ability to make more meaningful period-to-period comparisons of the
Company’s on-going operating results, (ii) the ability to
better identify trends in the Company’s business and perform
related trend analysis, and (iii) to facilitate a comparison
of the Company’s results of operations against investor and analyst
financial models and valuations, which may exclude these items.
(US$ m, except earnings per share data) |
Q4 2019 |
Q3 2019 |
Q2 2019 |
Q1 2019 |
Q4 2018 |
FY 2019 |
FY 2018 |
U.S. GAAP Net Earnings |
392 |
302 |
160 |
178 |
418 |
1,032 |
1,287 |
U.S. GAAP Diluted Earnings Per Share |
0.43 |
0.34 |
0.18 |
0.20 |
0.46 |
1.14 |
1.41 |
Impairment & Restructuring |
3 |
- |
2 |
- |
2 |
5 |
21 |
Estimated Income Tax Effect |
- |
- |
- |
- |
- |
(1) |
(2) |
Non-U.S. GAAP Net Earnings |
395 |
302 |
162 |
178 |
420 |
1,036 |
1,306 |
Non-U.S. GAAP Diluted Earnings Per Share |
0.43 |
0.34 |
0.18 |
0.20 |
0.46 |
1.15 |
1.43 |
(Appendix – continued)
Net financial position (non-U.S. GAAP
measure): resources (debt), represents the balance between
our total liquidity and our total financial debt. Our total
liquidity includes cash and cash equivalents, restricted cash,
short-term deposits and marketable securities, and our total
financial debt includes short-term borrowings, current portion of
long-term debt and long-term debt, all as reported in our
consolidated balance sheet. We believe our net financial position
provides useful information for investors and management because it
gives evidence of our global position either in terms of net
indebtedness or net cash position by measuring our capital
resources based on cash and cash equivalents, restricted cash,
short-term deposits and marketable securities and the total level
of our financial indebtedness.
(US$ m) |
Dec 31 2019 |
Sep 28 2019 |
Jun 29 2019 |
Mar 30 2019 |
Dec 31 2018 |
Cash and cash equivalents |
2,597 |
2,345 |
2,119 |
2,307 |
2,266 |
Restricted Cash |
10 |
60 |
60 |
60 |
- |
Short-term deposits |
4 |
- |
- |
- |
- |
Marketable securities |
133 |
133 |
333 |
331 |
330 |
Total liquidity |
2,744 |
2,538 |
2,512 |
2,698 |
2,596 |
Short-term debt |
(173) |
(171) |
(174) |
(173) |
(146) |
Long-term debt |
(1,899) |
(2,019) |
(2,030) |
(2,015) |
(1,764) |
Total financial debt |
(2,072) |
(2,190) |
(2,204) |
(2,188) |
(1,910) |
Net financial position |
672 |
348 |
308 |
510 |
686 |
Free cash flow (non-U.S. GAAP
measure) is defined as net cash from operating activities
minus net cash from (used in) investing activities, excluding
payment for purchases (proceeds from matured) marketable securities
and short-term deposits. We believe free cash flow provides useful
information for investors and management because it measures our
capacity to generate cash from our operating and investing
activities to sustain our operating activities. Free cash flow does
not represent total cash flow since it does not include the cash
flows generated by or used in financing activities. In addition,
our definition of free cash flow may differ from definitions used
by other companies.
(US$ m) |
Q4 2019 |
Q3 2019 |
Q2 2019 |
Q1 2019 |
Q4 2018 |
FY 2019 |
FY 2018 |
Net cash from operating activities |
775 |
429 |
324 |
341 |
656 |
1,869 |
1,845 |
Net cash used in investing activities |
(314) |
(59) |
(391) |
(408) |
(284) |
(1,172) |
(1,212) |
Payment for purchase and proceeds from matured marketable
securities, and investment in short-term deposits |
- |
(200) |
- |
- |
(9) |
(200) |
(100) |
Free cash flow |
461 |
170 |
(67) |
(67) |
363 |
497 |
533 |
- C2938C_STMicroelectronics Q4 & FY2019 results
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