On Sept. 7, National Semiconductor (NYSE:NSM) released Q1 2007 earnings for the period ended Aug. 27.
- Free cash flow is running a bit low due to plant modernization efforts, such as converting the six-inch wafer plant in Texas to a more efficient eight-inch facility. Combined with serious R&D -- which grew 10.3% from last year -- that's how a company like National invests in its future.
- Margin growth is looking good, and a net margin greater than 20% is impressive indeed, especially for a hardware manufacturer that runs its own fabrication plants.
- Wireless handset chips did decline, leading to lower revenues than originally forecast. Sales did beat the company's own lowered guidance, however.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Avg. Est. |
Q1 2007 |
Q1 2006 |
Change | |
|---|---|---|---|---|
|
Sales |
$541 |
$541 |
$494 |
9.6% |
|
Net Profit |
-- |
$120 |
$86 |
40.3% |
|
EPS |
$0.32 |
$0.35 |
$0.24 |
45.8% |
|
Diluted Shares |
-- |
344 |
364 |
(5.6%) |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q1 2007 |
Q1 2006 |
Change* | |
|---|---|---|---|
|
Gross Margin |
61.75% |
56.24% |
5.51 |
|
Operating Margin |
30.57% |
26.63% |
3.94 |
|
Net Margin |
22.18% |
17.33% |
4.85 |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$840 |
$1,016 |
(17.3%) |
|
Accounts Rec. |
$196 |
$154 |
27% |
|
Inventory |
$196 |
$157 |
24.6% |
|
Liabilities |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$82 |
$84 |
(1.6%) |
|
Long-Term Debt |
$21* |
$22 |
(4.5%) |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
Q1 2007 |
Q1 2006 |
Change | |
|---|---|---|---|
|
Cash From Ops. |
$133 |
$153 |
(12.7%) |
|
Capital Expenditures |
$41 |
$13 |
219.5% |
|
Free Cash Flow |
$92 |
$140 |
(34%) |
Find out why Fools always follow the money.
Related companies:
- Analog Devices (NYSE:ADI)
- Texas Instruments (NYSE:TXN)
- Marvell Technology (NASDAQ:MRVL)
- Linear Technology (NASDAQ:LLTC)
- Fairchild Semiconductor (NYSE:FCS)
- STMicroelectronics (NYSE:STM)
Related Foolishness:
- Foolish Fundamentals: Margins
- Foolish Fundamentals: Free Cash Flow
- Foolish Fundamentals: Cash Conversion Cycle
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At the time of publication, Fool contributor Anders Bylund had no position in any company discussed. Fool rules are here .
