Phoenix, AZ, November 8, 1999 - ON Semiconductor today announced its third quarter financial results which show revenue of $422 million and EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) of $106 million excluding six million dollars in one-time costs associated with the separation and launch ($100 million net).
ON Semiconductor, formerly a division of Motorola, is the world's leading supplier of analog, logic and discrete semiconductor components, integral parts of electronics that provide the security, convenience and entertainment in today's world. As a result of its August 1999 recapitalization, ON Semiconductor is now an independent company, 91% of which is owned by affiliates of Texas Pacific Group and 9% of which is owned by Motorola. ON Semiconductor is the tradename of SCG Holding Corporation and its subsidiaries.
Third Quarter Results
Product revenue in the third quarter grew to $422 million, an increase of 5% from the second quarter of 1999 and 23% from the third quarter of 1998. EBITDA in the third quarter grew to $100 million, an increase of 6% from the second quarter of 1999 and 92% from the third quarter of 1998. This improvement in EBITDA is primarily due to increased revenue and savings associated with an on-going cost restructuring plan initiated in the third quarter of 1998. Third quarter results also reflect a $6 million one-time charge for costs associated with the Company's transition to a stand-alone company following its August 1999 recapitalization.
"We are pleased to report the growth in our revenue and improvement in EBITDA. This is a significant achievement and marks a milestone for us in our first quarter as an independent company," said Steve Hanson, President of ON Semiconductor.
"We are continuing to experience a robust communications market and strong demand for our products in all markets, with particular strength in Asia."
ON Semiconductor launched the following products in its third quarter, which have been well received by the market:
- Analog ultra low noise five-output low drop out voltage regulator
- Analog half-bridge controller for fluorescent lamp ballast applications
- Analog power management control circuit for portable communication devices
- Analog voltage detector series in subminiature package
- Added products to our ECLinPS Plus logic family
- MOSFET/Schottky rectifier combination in one package
Demand continued to be strong and was consistent with second quarter demand. Third quarter 1999 global bookings showed a 25% growth above third quarter 1998. From a regional perspective, the Company is seeing a significant growth in Asia and good signs of recovery in the Japanese market.
"ON Semiconductor has successfully launched itself as a focused worldwide supplier of semiconductor components that surround the core of all electronic systems," said Curtis J. Crawford, ON Semiconductor's Chairman of the Board.
"The continued growth and profitability of this business reflects the smooth transition we are making in all of our operations, including manufacturing and information technology, after separating from Motorola."
All financial information presented in this press release is unaudited. For periods following the Company's August 1999 recapitalization, the historical financial results of ON Semiconductor are presented, and, for periods prior to the recapitalization, the "pro forma" financial results of ON Semiconductor are presented. These pro forma financial data are presented to show how ON Semiconductor might have looked if it had been an independent company for the periods presented and are based on the historical financial information of ON Semiconductor's predecessor, as adjusted to give effect to the recapitalization and certain other transactions. The pro forma financial data were prepared using certain assumptions and are provided for illustrative purposes but do not purport to represent the Company's actual financial position or results of operations.
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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. These risks include the dependence on new products and technologies, the potential for increased competition, a lack of market acceptance, the cyclical nature of the semiconductor industry and legal proceedings. Other factors that could cause or contribute to such differences include factors detailed in the sections "Risk Factors," and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's Form S-4 registration statement filed on or about November 5, 1999 with the Securities Exchange Commission. By making these forward looking statements, we undertake no obligation to update them for changes after the date of this press release.