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SST Reports Fourth Quarter and Fiscal 2009 Financial Results
Feb 04, 2010 (05:02 PM EST)


SUNNYVALE, Calif., Feb. 4 /PRNewswire-FirstCall/ -- SST (Silicon Storage Technology, Inc.) (Nasdaq: SSTI), a leader in flash memory technology, today announced results for the fourth quarter and fiscal year 2009.

Net revenues for the fourth quarter of 2009 were $72.9 million compared with $71.3 million in the third quarter of 2009 and compared with $58.4 million in the fourth quarter of 2008.  Product revenues for the fourth quarter of 2009 were $60.3 million, compared with $61.8 million in the third quarter of 2009 and with $46.3 million in the fourth quarter of 2008. Revenues from technology licensing for the fourth quarter of 2009 were $12.5 million, compared with $9.5 million in the third quarter of 2009 and with $12.1 million in the fourth quarter of 2008.

Income from operations for the fourth quarter of 2009 was $3.0 million, which compares with income from operations of $1.5 million in the third quarter of 2009 and with a loss from operations of $10.8 million in the fourth quarter of 2008.

Net income for the fourth quarter of 2009 was $2.4 million, or $0.02 per share, based on approximately 95.9 million diluted shares. By comparison, the company recorded net income of $3.1 million, or $0.03 per share based on approximately 95.9 million shares in the third quarter of 2009.  For the fourth quarter of 2008, SST reported a net loss of $36.6 million, or $0.38 per share based on approximately 95.5 million diluted shares.

SST finished the fourth quarter of 2009 with $142.5 million in cash, cash equivalents, short-term investments, and long-term marketable debt securities, down approximately $1.3 million from $143.8 million at Sept. 30, 2009.  

Fiscal 2009 Financial Results

Net revenues for the year ended Dec. 31, 2009 were $252.3 million compared with $315.5 million for the year ended Dec. 31, 2008. Total gross margin for 2009 was 29.8 percent compared with 30.8 percent in 2008. Product gross margins for 2009 were 16.7 percent compared with 18.2 percent in 2008. Operating expenses for the year ended Dec. 31, 2009 were $84.5 million compared with $114.4 million in 2008. Net loss for the year ended Dec. 31, 2009 was $10.2 million, or a loss of $0.11 per share based on 95.8 million diluted shares outstanding.  This compares with a net loss of $39.8 million, or a loss of $0.40 per diluted share based on 100.0 million diluted shares outstanding for the year ended Dec. 31, 2008.

About Silicon Storage Technology, Inc.

Headquartered in Sunnyvale, California, SST designs, manufactures and markets a diversified range of memory and non-memory products for high volume applications in the digital consumer, networking, wireless communications and Internet computing markets.  Leveraging its proprietary, patented SuperFlash technology, SST is a leading provider of nonvolatile memory solutions with product families that include various densities of high functionality flash memory components and flash mass storage products.  The company also offers its SuperFlash technology for embedded applications through its broad network of world-class manufacturing partners and technology licensees, including TSMC, which offers it under its trademark Emb-FLASH.  SST's non-memory products include NAND controller-based products, smart card ICs and modules, flash microcontrollers and radio frequency ICs and modules.  Further information on SST can be found on the company's Web site at http://www.sst.com.

For more information about SST and the company's comprehensive list of product offerings, please call 1-888/SST-CHIP.  Information can also be requested via email to literature@sst.com or through SST's Web site at http://www.sst.com.  SST's head office is located at 1020 Kifer Road, Sunnyvale, Calif.; telephone: 408/735-9110; fax: 408/735-9036.

The SST logo and SuperFlash are registered trademarks of Silicon Storage Technology, Inc. All other trademarks or registered trademarks are the property of their respective holders.

For More Information Contact:

Leslie Green

Green Communications Consulting, LLC

(650) 312-9060


-- FINANCIAL TABLES TO FOLLOW --

    
    
    
    
                 Silicon Storage Technology, Inc. and Subsidiaries
                 Condensed Consolidated Statements of Operations
                                   (unaudited) 
                      (in thousands, except per share data)
    
                              Three Months Ended          Year Ended   
                                 December 31,            December 31,         
                                ---------------         -------------- 
                                2008     2009         2008          2009 
                                ----     ----         ----          ---- 
                                                                          
    Net revenues:                                                         
      Product revenues        $46,293  $60,343     $266,865      $212,662 
      Technology                                                          
       licensing               12,059   12,519       48,670        39,665 
                               ------   ------       ------        ------ 
        Total net                                                         
         revenues              58,352   72,862      315,535       252,327 
    Cost of revenues           41,756   49,188      218,304       177,087 
                               ------   ------      -------       ------- 
    Gross profit               16,596   23,674       97,231        75,240 
                               ------   ------       ------        ------ 
    Operating expenses:                                                   
      Research and                                                        
       development             13,860    9,913       58,955        43,160 
      Sales and                                                           
       marketing                5,491    5,071       26,605        20,344 
      General and                                                         
       administrative           5,496    5,658       26,331        20,706 
      Other                     2,514        -        2,514           329 
                                -----      ---        -----           --- 
        Total operating                                                   
         expenses              27,361   20,642      114,405        84,539 
                               ------   ------      -------        ------ 
    Income (loss) from                                                    
     operations               (10,765)   3,032      (17,174)       (9,299)
    Gain on sale of equity                                                
     investments                    -      731            -         1,811 
    Impairment of equity                                                  
     investments              (21,598)       -      (21,832)         (485)
    Other income, net             581      227        4,978         3,708 
                                  ---      ---        -----         ----- 
    Income (loss) before
     provision for (benefit 
     from) income taxes                                                   
     and pro rata share of                                              
     loss from equity                                                       
     investments              (31,782)   3,990      (34,028)       (4,265)
    Provision for (benefit                                                
     from) income taxes         1,740    1,321       (3,358)        4,692 
                                -----    -----       ------         ----- 
    Income (loss) before
     pro rata share of 
     loss from equity                                                     
     investments              (33,522)   2,669      (30,670)       (8,957)
    Pro rata share of loss                                                
     from  equity
     investments                3,105      309        9,145         1,280 
                                -----      ---        -----         ----- 
    Net income (loss)        $(36,627)  $2,360     $(39,815)     $(10,237)
                             ========   ======     ========      ======== 
                                                                          
    Net income (loss) per                                                 
     share - basic             $(0.38)   $0.02       $(0.40)       $(0.11)
                               ======    =====       ======        ====== 
    Shares used in per share                                              
     calculation - basic       95,495   95,854      100,019        95,790 
                               ======   ======      =======        ====== 
                                                                          
    Net income (loss) per                                                 
     share - diluted           $(0.38)   $0.02       $(0.40)       $(0.11)
                               ======    =====       ======        ====== 
    Shares used in per share                                              
     calculation - diluted     95,495   95,870      100,019        95,790 
                               ======   ======      =======        ====== 
    
    
    
                 Silicon Storage Technology, Inc. and Subsidiaries
                      Condensed Consolidated Balance Sheets
                                   (unaudited) 
                                  (in thousands)
    
                                                    December 31,   
                                                   2008      2009 
                                                   ----      ---- 
                                                                    
                         ASSETS                                     
    Current assets:                                                 
      Cash and cash equivalents                   $50,880   $92,299 
      Short-term investments                       48,997    30,613 
      Trade accounts receivable, net               20,117    37,660 
      Inventories                                  54,159    36,881 
      Other current assets                          4,153     5,317 
                                                    -----     ----- 
        Total current assets                      178,306   202,770 
                                                                    
    Long-term marketable debt securities           31,848    19,609 
    Long-term marketable equity investments        18,196    40,619 
    Equity investments, others                     24,619    32,156 
    Property and equipment, net                    18,913    12,051 
    Goodwill and intangible assets, net            14,794    12,882 
    Other assets                                    1,807     4,520 
                                                    -----     ----- 
        Total assets                             $288,483  $324,607 
                                                 ========  ======== 
                                                                    
                       LIABILITIES                                  
    Current liabilities:                                            
      Trade accounts payable                      $19,146   $28,238 
      Accrued expenses and other liabilities       14,200    12,215 
      Deferred revenue                              3,841    13,970 
                                                    -----    ------ 
        Total current liabilities                  37,187    54,423 
                                                                    
    Other liabilities                               8,082    10,057 
                                                    -----    ------ 
        Total liabilities                          45,269    64,480 
                                                   ------    ------ 
                                                                    
                  SHAREHOLDERS' EQUITY                              
    Common stock                                  412,312   415,267 
    Accumulated other comprehensive income         14,308    38,503 
    Accumulated deficit                          (183,406) (193,643)
                                                 --------  -------- 
      Total shareholders' equity                  243,214   260,127 
                                                  -------   ------- 
        Total liabilities and shareholders'                         
         equity                                  $288,483  $324,607 
                                                 ========  ======== 
    
    
    
                Silicon Storage Technology, Inc. and Subsidiaries
                                 Supplemental Data
    
                               Percentage of             
                               Gross Product         Change in     
                                  Revenue             Revenue       
                               -------------          -------       
                                                  4Q08 to   3Q09 to  
                               4Q08  3Q09  4Q09    4Q09      4Q09   
                               ----  ----  ----    ----      ----   
                                                                  
    Product Revenue
     By Ship-To Location                           
      North America             8%    4%    6%       2%       54% 
      Total International      92%   96%   94%      37%       (3%)
        Europe                  7%    4%    5%     (13%)      18% 
        Japan                  13%   12%   11%      12%      (12%)
        Korea                   8%    7%    7%      21%        0% 
        China and Taiwan       54%   64%   60%     (26%)      16% 
        Other Far East         10%    9%   11%      54%       21% 
                                                                  
    Product Revenue by Application                                
      Digital Consumer         26%   24%   22%       7%      (10%)
      Internet Computing       24%   24%   29%      65%       19% 
      Networking               11%   16%   15%      80%       (6%)
      Wireless                                                    
       Communications          39%   36%   34%      12%       (9%)
      Total                   100%  100%  100%      34%       (1%)
                                                                  
    Licensing Revenue as a                                        
     % of Total Revenue        21%   13%   17%       5%       33% 
    
    
    

SOURCE Silicon Storage Technology, Inc.