Skip navigation
Skip navigation
You are using an outdated browser. Please upgrade your browser.

20 July 2000

ON Semiconductor (NASDAQ: ONNN) today announced product
revenues of $531 million for the second quarter of 2000, an
increase of 32% as compared to the second quarter of 1999
and an increase of 18% sequentially from the first quarter
of 2000. Excluding non-recurring charges and amortisation of
intangibles, earnings were $34.9 million or $0.20 per
diluted share for the second quarter of 2000. Including the
non-recurring charges of $33.6 million on an after tax basis
and the amortisation of intangibles, the Company had a net
loss of $2.0 million or $.03 per diluted share for the
second quarter of 2000.

The non-recurring charges relate to the acquisition of
Cherry Semiconductor on April 3, 2000 and the Company's
prepayment of debt with the proceeds of its initial public
offering of common stock. With respect to the Cherry
acquisition, the Company took a one-time charge of $26.9
million, or $16.1 million on an after tax basis, for the
write-off of in-process research and development. As a
result of the debt prepayment, the Company incurred debt
prepayment fees and was required to write-off a portion of
its capitalised debt issuance costs. The combined impact of
the debt prepayment fees and write-off of capitalised debt
issuance costs amounted to $29.2 million, or $17.5 million
on an after tax basis, and is reported as an extraordinary
item in the Company's financial statements.

The improvement in product revenues in the second quarter of
2000 reflects increases in revenues for each of the
Company's three primary product segments, as compared to the
second quarter of 1999. Revenues from analog products
increased 90% (or 40% excluding the additional revenues
resulting from the Cherry acquisition) to $150 million,
revenues from logic products increased 35% to $131 million,
led by the 56% increase in ECL (Emitter-coupled logic)
products, and revenues from discrete products increased 11%
to $249 million. Overall product gross margin was 35.9% in
the second quarter of 2000, as compared to 35.2% and 31.6%
in the first quarter of 2000 and the second quarter of 1999,
respectively. Product revenues in the first six months of
2000 were $983 million, an increase of 27% compared to the
first six months of 1999. Product gross margins improved to
35.6% for the first six months of 2000 from 29.9% for the
first six months of 1999. Excluding the amortisation of
intangibles and non-recurring charges, earnings were $60.4
million or $0.33 per diluted share for the first six months
of 2000. Including the amortisation of intangibles and
non-recurring charges, the Company had net income of $23.5
million or $.10 per diluted share for the first six months
of 2000.

Earnings before interest, taxes, depreciation and
amortisation, excluding minority interests and non-recurring
charges (EBITDA) for the second quarter and for the first
six months of 2000 were $129 million and $239 million,

Commenting on the results, Steve Hanson, President and Chief
Executive Officer of ON Semiconductor said, "The results of
the quarter demonstrate that our strategy to develop the
high-performance segments of our business is paying off. The
growth in revenues from analogue and logic products,
especially the ECL line, is outpacing all other revenue
growth in the Company and is giving us leverage on both the
gross and operating margins. Analog products and logic
products now represent 28% and 25% of product sales,
respectively, compared with 20% and 24%, respectively, in
the second quarter of 1999."

He continued, "During the first half of 2000, we introduced
154 new products, of which the majority were focused on
broadband communications, hand-held devices and
micro-packaging to address the electronics explosion."

Hanson concluded, "During the quarter, we welcomed the
Cherry Semiconductor employees to the ON family and are
pleased to report that the integration is going smoothly and
meeting all of our expectations."

ON Semiconductor, a former division of Motorola was acquired
by Texas Pacific Group on August 4, 1999. The results
reported are pro forma for the periods prior to this
transaction. The pro forma information is based on the
historical financial information of the Semiconductor
Components Group of Motorola, as adjusted to give effect to
the Company's August 1999 re-capitalisation. It is presented
as if ON Semiconductor had been an independent company for
the periods presented. The pro forma financial data was
prepared using assumptions and unaudited financial
statements and is provided for illustrative purposes. It
does not purport to represent the Company's actual financial

- ends -

Editors Notes:

About ON Semiconductor:

ON Semiconductor is one of the world's largest suppliers of
analog, standard logic, and discrete semiconductors for data
and power management. ON Semiconductor's products include
integrated circuits for high-bandwidth data applications,
analogue ICs for power management and low-voltage power
transistors. In addition to using micropackaging technology
across all product families, ON Semiconductor offers the
largest selection of discrete semiconductors in a variety of
surface mount and standard packages. These semiconductors
turn on and connect digital electronic products to our
world. ON Semiconductor is the trade name of SCG Holding
Corporation's affiliate, Semiconductor Components
Industries, LLC.

Some statements contained in this press release may be
forward looking statements, subject to risks and
uncertainties that could cause ON Semiconductor's actual
results and financial position to differ materially from
those statements. These risks and uncertainties include, but
are not limited to, the cyclical nature of the semiconductor
industry, fluctuations in our quarterly operating results,
new product development and technological change,
competition in our industry, and the ability of ON
Semiconductor to integrate the Cherry Semiconductor business
and realise the synergies expected as a result of the
acquisition. Investors should also consult the Company's
publicly available Securities and Exchange Commission
filings for additional information about these and other
risks and uncertainties. The Company assumes no obligation
to update forward-looking statements to reflect actual
results or changed assumptions or other factors.

This press release was distributed by ResponseSource Press Release Wire on behalf of Pleon in the following categories: Consumer Technology, Personal Finance, Business & Finance, Computing & Telecoms, for more information visit