Ramtron Reports Third-Quarter 2008 Financial Results

COLORADO SPRINGS, Colo.--(BUSINESS WIRE)--Ramtron International Corporation (Nasdaq: RMTR), a leading developer and supplier of nonvolatile ferroelectric random access memory (F-RAM) and integrated semiconductor products, today reported total revenue of $17.4 million for the third quarter of 2008, 30% higher than the $13.4 million reported for the same quarter of 2007. Third quarter product revenue was $17.1 million, 31% higher than product revenue of $13.0 million reported for the same quarter last year.

Third-quarter net income was $1.4 million, or $0.05 per share, compared with net income of $1.1 million, or $0.05 per share, for the same quarter a year earlier. Third-quarter 2008 results include non-cash, stock-based compensation expense of $242,000, and an income tax provision of $719,000, of which $699,000 was non-cash. Without these items, third-quarter 2008 net income would have been $2.4 million, or $0.09 per share. For comparative purposes, third-quarter 2007 net income excluding the same items would have been $1.8 million, or $0.07 per share. Product gross margin for the third quarter of 2008 was 54%, compared with 53% for the third quarter of 2007.

At the end of 2007, Ramtron recorded a $7.6 million deferred tax asset on its balance sheet that represented the estimated amount of tax loss carry forward the company expected to offset with future taxable income. This asset will be reduced by the amount of a non-cash tax provision that will be recorded on the company’s income statement on a quarterly basis.

“Fueled by strong printer related product revenue and growing sales of our serial and parallel F-RAM products, Ramtron delivered an exceptionally strong quarter,” said Ramtron CEO Bill Staunton. “Products introduced since 2006 continued to be the main growth drivers, contributing 31% of the quarter’s revenue. High-density 2- and 4-megabit product sales also contributed to our results by more than doubling over the second quarter of 2008.

“As high-density sales gained traction, we launched our F-RAM V-Family during the third quarter, which will further extend our high density F-RAM revenue opportunity. More V-Family F-RAM products are due in November as we begin an aggressive marketing effort to drive sampling and design-in activity,” Staunton added.

Third-Quarter Product Highlights:

• Integrated product revenue grew 132% to $5.1 million, or 30% of F-RAM product revenue, during the third quarter of 2008, compared with $2.2 million, or 17% of F-RAM revenue, for the third quarter of 2007.
• Ramtron announced the FM25V10, a 1-megabit device in a family of new F-RAM products that offer high-speed read/write performance, low voltage operation, and optional device features.
• Sales of Ramtron’s high-density F-RAM products, which include 2- and 4-megabit devices, more than doubled from the second quarter of 2008 to $408,000 or 2.4% of revenue.
• Ramtron announced the use of F-RAM in energy optimizers and professional gaming machines

“Since the beginning of the fourth quarter, the business environment has become more conservative, marked by a heightened level of caution being exercised by some customers and distributors and some softening in orders,” Staunton added. “As a result, we now anticipate that our 2008 growth will be at the lower end our original annual revenue growth target range of 24% to 28% over 2007.

“Ramtron anticipates strong growth again next year, but we realize that replicating our 2008 growth rate will be challenging in the current environment,” Staunton continued. “Despite this, we believe our new products and diverse end markets will allow us to grow faster than the overall semiconductor industry. As we continue to execute our business strategy, our strong cash position, minimal debt, and positive cash flow place Ramtron in a solid position to continue investing in the product development and marketing initiatives that will drive future growth.”

Conference Call

Ramtron management’s teleconference today will be webcast live on the corporate website. Management plans to webcast slides to support its prepared remarks on quarterly results and business outlook, and then host a live question-and-answer session with institutional investors and research analysts.

How to Participate

Ramtron Third-Quarter 2008 Results Teleconference

October 30, 2008 at 2:00 p.m. PT / 5:00 p.m. ET

Go to the home page of the Ramtron site at www.ramtron.com and click on the teleconference link. From this site, you can access the teleconference webcast, assuming that your computer system is configured properly. A webcast replay will be available for one year, and a telephonic replay will be available for seven days after the live call at 706-645-9291, code # 66647838.

About Ramtron

Ramtron International Corporation, headquartered in Colorado Springs, Colorado, is a fabless semiconductor company that designs, develops and markets specialized semiconductor memory, microcontroller and integrated semiconductor solutions used in a wide range of product applications and markets.

Cautionary Statements

Except for historical information, this press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of forward-looking words or phrases such as “believe,” “expect,” “anticipate,” “should,” and “potential,” among others. Specific forward-looking statements include statements about Ramtron’s expected revenue growth for full-year 2008. These forward-looking statements are inherently difficult to predict and involve risks and uncertainties that could cause actual results to differ materially, including, but not limited to: general and regional economic conditions and conditions specific to the semiconductor industry; demand for Ramtron’s products; order cancellations or reduced order placements; product sales mix; the timely development of new technologies; competitive factors such as pricing pressures on existing products and the timing and market acceptance of new product introductions; Ramtron’s ability to maintain an appropriate amount of low-cost foundry production capacity from its foundry sources in a timely manner; our foundry partners’ timely ability to successfully manufacture products for Ramtron; our foundry partners’ ability to supply increased orders for F-RAM products in a timely manner using Ramtron’s proprietary technology; any disruptions of Ramtron’s foundry or test and assembly contractor relationships; currency fluctuations; unexpected design and manufacturing difficulties; defects in products that could result in product liability claims; and the risk factors listed from time to time in Ramtron’s SEC reports, including, but not limited to, the Annual Report on Form 10-K for the year ended December 31, 2007 and Quarterly Reports filed during 2008. SEC-filed documents are available at no charge at the SEC’s website (www.sec.gov) or from the company.

All forward-looking statements included in this release are based upon information available to Ramtron as of the date of this release, which may change.

The financial information in this press release and the attached financial statements have been prepared from the books and records of the company with the omission of certain information and disclosures normally included in financial statements.

In this release, the references to third-quarter net income and earnings per share excluding stock-based compensation charges and income tax provision are not financial measures as defined by generally accepted accounting principles (GAAP). Management believes that the presentation of results excluding these charges provides meaningful supplemental information regarding the Company’s operational performance; however, these figures are not a replacement for the GAAP financial measures presented nor should they be given greater consideration by investors.

RAMTRON INTERNATIONAL CORPORATION THIRD-QUARTER FINANCIAL HIGHLIGHTS CONDENSED CONSOLIDATED INCOME STATEMENTS  (Amounts in thousands, except per-share amounts) (Unaudited)
		Three Months Ended September 30,								Nine Months Ended September 30,
		2008				2007				2008				2007
Revenue:
Product sales		$	17,095			$	13,035			$	46,093			$	35,683
License fees			179				179				537				537
Royalties			120				186				513				499
Customer-sponsored research and development			--				--				90				100
			17,394				13,400				47,233				36,819
Costs and expenses:
Cost of product sales			7,781				6,071				21,392				16,949
Research and development			3,235				2,607				9,191				7,956
Customer-sponsored research and development			--				--				47				94
Sales and marketing			2,408				1,590				6,641				5,251
General and administrative			1,716				1,854				5,273				4,986
			15,140				12,122				42,544				35,236
Operating income			2,254				1,278				4,689				1,583
Interest expense			(78	)			(113	)			(281	)			(389	)
Other income (expense), net			(55	)			17				(67	)			81
Income before income tax provision			2,121				1,182				4,341				1,275
Income tax provision			(719	)			(46	)			(1,596	)			(93	)
Net income		$	1,402			$	1,136			$	2,745			$	1,182
Net income per common share:
Basic		$	0.05			$	0.05			$	0.10			$	0.05
Diluted		$	0.05			$	0.04			$	0.10			$	0.05
Weighted average common shares outstanding:
Basic			26,563				25,161				26,190				25,074
Diluted			27,726				26,447				27,789				26,041

CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands) (Unaudited)
		September 30,			December 31,
		2008			2007
ASSETS
Current assets:
Cash and cash equivalents		$	10,523		$	6,828
Accounts receivable, net			10,359			9,490
Inventories			8,821			6,342
Deferred income taxes, net			252			286
Other current assets			953			789
Total current assets			30,908			23,735
Property, plant and equipment, net			5,507			4,987
Goodwill, net			2,217			2,311
Intangible assets, net			7,235			7,963
Deferred income taxes, net			5,806			7,300
Other assets			212			230
Total assets		$	51,885		$	46,526
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	5,125		$	4,168
Accrued liabilities			2,320			2,416
Deferred revenue			694			949
Current portion of long-term debt			380			1,040
Total current liabilities			8,519			8,573
Long-term deferred revenue			1,371			1,854
Long-term debt			4,595			4,894
Total liabilities			14,485			15,321
Stockholders' equity			37,400			31,205
		$	51,885		$	46,526