Corporate | 27 November 2014 07:30

Infineon Technologies AG: INFINEON POSTS SOLID FOURTH-QUARTER EARNINGS AND PROPOSES A DIVIDEND OF EUR0.18 PER SHARE

Infineon Technologies AG / Key word(s): Quarter Results/Final Results

27.11.2014 / 07:30

– Q4 FY 2014: REVENUE EUR1,175 MILLION; SEGMENT RESULT OF EUR188 MILLION; SEGMENT RESULT MARGIN OF 16.0 PERCENT

– FY 2014: REVENUE UP BY 12 PERCENT TO EUR4,320 MILLION, SEGMENT RESULT OF EUR620 MILLION, SEGMENT RESULT MARGIN OF 14.4 PERCENT

– OUTLOOK FOR Q1 FY 2015: DUE TO NORMAL SEASONALITY, REVENUE EXPECTED TO DECREASE BY BETWEEN 5 AND 9 PERCENT WITH SEGMENT RESULT MARGIN BETWEEN 10 AND 13 PERCENT

– OUTLOOK FOR FY 2015: REVENUE INCREASE OF 8 PERCENT, PLUS OR MINUS 2 PERCENTAGE POINTS, COMPARED TO PREVIOUS FISCAL YEAR, WITH SEGMENT RESULT MARGIN AT ABOUT 14 PERCENT

– MANAGEMENT BOARD AND SUPERVISORY BOARD PROPOSE DIVIDEND OF EUR0.18 PER SHARE FOR 2014 FISCAL YEAR

Neubiberg, Germany, November 27, 2014 – Infineon Technologies AG today reports its results for the fourth quarter and the 2014 fiscal year, both ended September 30, 2014.

in Euro million	Q3 FY14	Q3 FY14	+/- in %

Revenue	1,175	1,110	6
Segment Result	188	170	11
Segment Result Margin [in %]	16.0	15.3
Income (loss) from continuing operations	148	143	3
Income (loss) from discontinued operations, net of income taxes	33	–
Net income	181	143	27

in Euro
Basic earnings (loss) per share from continuing operations ¹	0.13	0.13	–
Basic earnings (loss) per share from discontinued operations ¹	0.03	–	+++
Basic earnings per share ¹	0.16	0.13	23

Diluted earnings (loss) per share from continuing operations ¹	0.13	0.13	–
Diluted earnings (loss) per share from discontinued operations ¹	0.03	–	+++
Diluted earnings per share ¹	0.16	0.13	23

¹ The calculation for earnings per share is based on unrounded figures.

“We have made good use of the opportunities open to us in a dynamically growing market. We were well prepared to handle steeply rising demand from our customers and therefore always able to deliver reliably. Revenue, earnings and margin all saw solid increases, in line with our expectations. Infineon’s Management Board and Supervisory Board want shareholders to participate in this success and are therefore proposing a dividend of EUR0.18 per share,” stated Dr. Reinhard Ploss, CEO of Infineon Technologies AG. “Despite a challenging market environment, we plan to continue growing in the current 2015 fiscal year – in addition to growth resulting from the planned acquisition of International Rectifier.”

GROUP EARNINGS IN THE FOURTH QUARTER OF THE 2014 FISCAL YEAR
Revenue generated by the Infineon Group grew by 6 percent in the fourth quarter of the 2014 fiscal year to EUR1,175 million, compared with EUR1,110 million in the preceding quarter. Revenue growth was particularly strong in the Industrial Power Control (IPC), Power Management & Multimarket (PMM) and Chip Card & Security (CCS) segments. From the strong revenue base achieved in the preceding quarters, revenue for the Automotive (ATV) segment grew by a further 2 percent.

Segment Result also increased on the back of this revenue growth, rising by 11 percent from EUR170 million in the preceding quarter to EUR188 million in the fourth quarter of the 2014 fiscal year, with the Segment Result Margin improving from 15.3 percent to 16.0 percent.

Income from continuing operations increased slightly from EUR143 million to EUR148 million in the fourth quarter of the 2014 fiscal year. In addition to the improved Segment Result, two other factors influenced this development. On the one hand, operating income decreased from EUR165 million in the third quarter to EUR118 million in the fourth quarter, mainly resulting from a fine of EUR83 million imposed by the European Commission in conjunction with antitrust proceedings against several manufacturers of semiconductors used in chip card applications (expense recorded in other operating expenses). A tax benefit of EUR29 million resulting from the revaluation of deferred tax assets on tax loss carry-forwards worked in the opposite direction.

The result from discontinued operations improved from nil in the third quarter to EUR33 million in the fourth quarter, primarily due to the partial reversal of provisions to reflect the partial settlement reached with the insolvency administrator of Qimonda AG in September.

Fourth-quarter net income improved to EUR181 million, following on from the EUR143 million recorded in the previous quarter. Earnings per share (basic and diluted) increased from EUR0.13 in the third quarter to EUR0.16 in the fourth quarter.

Investments – which Infineon defines as the sum of purchases of property, plant and equipment, purchases of intangible assets, and capitalized development costs – amounted to EUR242 million in the fourth quarter and were thus significantly higher than the previous quarter’s figure of EUR144 million. Depreciation and amortization increased slightly from EUR131 million in the third quarter to EUR137 million in the fourth.

Free cash flow from continuing operations increased significantly quarter-on-quarter from EUR78 million to EUR158 million. The considerably higher level of net cash provided by operating activities was only partly reduced by increased investments.

Due to the strong free cash flow, the gross cash position amounted to EUR2,418 million at September 30, 2014, compared with EUR2,263 million at the end of June 2014. The net cash position also improved over the same period from EUR2,073 million to EUR2,232 million.

DIVIDEND FOR THE 2014 FISCAL YEAR: EUR0.18 PER SHARE
The Management Board and the Supervisory Board of Infineon Technologies AG have decided to put forward a proposal at the Annual General Meeting (to be held in Munich on February 12, 2015) that the dividend for the 2014 fiscal year be raised by EUR0.06 to EUR0.18. This proposed level of dividend is at the upper end of the range of EUR0.16 to EUR0.18 per share communicated in May 2014.

Infineon’s strategy is to pursue a dividend policy that enables shareholders to participate appropriately in growing earnings or, in times of flat or declining earnings and/or with negative free cash flows, to keep the dividend at a constant level.

OUTLOOK FOR FIRST QUARTER OF 2015 FISCAL YEAR
Due to the seasonal decline of demand towards the end of the calendar year, Infineon expects revenue to decrease by between 5 and 9 percent in the first quarter of the 2015 fiscal year. The first-quarter Segment Result Margin is forecast to come in at between 10 and 13 percent. Revenue is expected to be lower in all four segments, with ATV recording the smallest decrease in percentage terms.

OUTLOOK FOR THE 2015 FISCAL YEAR
For the 2015 fiscal year, based on an assumed exchange rate of US$1.30 to the euro, Infineon forecasts a year-on-year growth in revenue of 8 percent, plus or minus 2 percentage points. At the mid-point of the planned range for revenue growth, the Segment Result Margin is expected to be about 14 percent.

The ATV, PMM and CCS segments are forecast revenue to grow either in line with or slightly faster than the average for the Group as a whole. Revenue growth in the IPC segment is expected to be significantly below the Group average. Planned investments for the 2015 fiscal year are around EUR700 million, containing an amount of about 13 percent of sales for investments for equipment within our operating facilities and for intangibles as one part. In addition between EUR60 and EUR70 million will be spent for readying our second shell in Kulim, Malaysia, for volume production and payments of approximately EUR20 million are required for the purchase of Qimonda patents in conjunction with the settlement recently reached with the insolvency administrator of Qimonda AG. Depreciation and amortization should amount to approximately EUR600 million.

PLANNED ACQUISITION OF INTERNATIONAL RECTIFIER
On August 20, 2014 Infineon announced its intention to acquire all of the shares of the US semiconductor manufacturer International Rectifier for US$40 per share. At the Extraordinary Meeting of the shareholders of that entity on November 4, 2014, the sale was approved with a 99.5 percent shareholder vote. The acquisition now only requires the approval of the relevant regulatory authorities. Subject to the necessary approvals, closing is expected towards the end of the 2014 calendar year or at the beginning of the 2015 calendar year.

Infineon segments’ performance in the fourth quarter of the 2014 fiscal year can be found in the quarterly information at http://www.infineon.com .

All figures in this quarterly information are preliminary and unaudited.

ANALYST TELEPHONE CONFERENCE AND PRESS CONFERENCE
Infineon will host a telephone conference call for analysts and investors (in English only) on November 27, 2014 at 9:30 am (CET), 3:30 am (EST). During the call, the Infineon Management Board will present the Company’s results from the fourth quarter and 2014 fiscal year. In addition, the Management Board will host a live press conference at 11:00 am (CET), 5:00 am (EST). It can be followed over the Internet in both English and German. Both conferences will also be available live and for download on Infineon’s website at www.infineon.com/investor .

The Q4 Investor Presentation is available (in English only) at: http://www.infineon.com/cms/en/corporate/investor/reporting/index.html

The 2014 annual report will be published starting today at about 10.00 am (CET) on Infineon’s website as well the website of Deutsche Börse. www.infineon.com/annualreport

INFINEON FINANCIAL CALENDAR (*preliminary)

– Dec 2-3, 2014 Credit Suisse TMT Conference, Scottsdale/Arizona

– Jan 29, 2015* Earnings Release for the First Quarter of the 2015 Fiscal Year

– Feb 12, 2015 Annual General Meeting 2015, Munich

– May 5, 2015* Earnings Release for the Second Quarter of the 2015 Fiscal Year

– Jul 30, 2015* Earnings Release for the Third Quarter of the 2015 Fiscal Year

– Nov 26, 2015* Earnings Release for the Fourth Quarter and Full 2015 Fiscal Year

ABOUT INFINEON
Infineon Technologies AG, Neubiberg, Germany, offers semiconductor and system solutions addressing three central challenges to modern society: energy efficiency , mobility , and security . In the 2014 fiscal year (ending September 30), the Company reported sales of Euro 4.3 billion with around 29.800 employees worldwide. Infineon is listed on the Frankfurt Stock Exchange (ticker symbol: IFX) and in the USA on the over-the-counter market OTCQX International Premier (ticker symbol: IFNNY).

Further information is available at www.infineon.com .

This news release is available online at www.infineon.com/press .

D I S C L A I M E R
This press release contains forward-looking statements about the business, financial condition and earnings performance of the Infineon Group.

These statements are based on assumptions and projections resting upon currently available information and present estimates. They are subject to a multitude of uncertainties and risks. Actual business development may therefore differ materially from what has been expected.

Beyond disclosure requirements stipulated by law, Infineon does not undertake any obligation to update forward-looking statements.

27.11.2014 Dissemination of a Corporate News, transmitted by DGAP – a service of EQS Group AG.
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Language:	English
Company:	Infineon Technologies AG
	Am Campeon 1-12
	85579 Neubiberg
	Germany
Phone:	+49 (0)89 234-26655
Fax:	+49 (0)89 234-955 2987
E-mail:	investor.relations@infineon.com
Internet:	www.infineon.com
ISIN:	DE0006231004
WKN:	623100
Indices:	DAX
Listed:	Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover, München, Stuttgart; Terminbörse EUREX


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