Microchip Tech Cuts 3Q View Amid Slowdown, Extends Pay Cut
The company now sees fiscal-third quarter earnings, excluding items, of 23 cents to 26 cents a share, down from its October view of 35 cents to 41 cents.
Additionally, Microchip said it expects fiscal third-quarter net sales to be down 29% to 31% from $269.7 million in the fiscal second quarter. That would result in sales of $186.1 million to $191.5 million, well below the $232 million expected by Wall Street.
Microchip, which was one of the companies that recently considered pursuing rival chip maker Atmel Corp. (ATML), said it would extend its pay cuts for all nonmanufacturing employees, which began during the fiscal third quarter, and said it would continue to reduce capacity at its water-fabrication facilities in the U.S. and assembly and test facility in Thailand.
Despite the belt-tightening, Microchip said it would maintain its dividend by using a portion of the cash from its balance sheet. The company, which last increased its dividend payment to 33.9 cents a share, initiated quarterly cash dividend payments in the third quarter of fiscal 2003.
In November, Goldman Sachs warned there were signs of slowing growth for Microchip, which faces increasing competition and a shift in the microprocessor market away from the company's core competency. The company specializes in microcontrollers and analog semiconductors.
Its shares were even at $20.01 in after-hours trading.
-By John Kell, Dow Jones Newswires; 201-938-5285; john.kell@dowjones.com
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Publié le 06 janvier 2009 Copyright © 2009 Dowjones
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