SMART Global Holdings(US:SGH)2022-06-30 20:02Financial Performance - For the three months ended May 27, 2022, net sales increased to $462.54 million, up from $437.73 million in the same period last year, representing a growth of 5.9%[18] - Gross profit for the three months ended May 27, 2022, was $114.46 million, compared to $84.49 million for the same period in 2021, reflecting a significant increase of 35.4%[18] - Operating income for the three months ended May 27, 2022, rose to $35.31 million, compared to $2.89 million in the prior year, indicating a substantial improvement[18] - Net income attributable to SGH for the three months ended May 27, 2022, was $24.11 million, a turnaround from a net loss of $7.21 million in the same quarter of 2021[18] - The company reported a basic earnings per share of $0.48 for the three months ended May 27, 2022, compared to a loss per share of $0.15 in the prior year[18] - Comprehensive income attributable to SGH for the three months ended May 27, 2022, was $42.92 million, compared to a loss of $4.64 million in the same quarter of 2021[21] - Net income for the nine months ended May 27, 2022, was $48,165 thousand, a significant increase from $1,217 thousand in the same period of 2021[29] Assets and Liabilities - Total current assets increased to $1.17 billion as of May 27, 2022, from $950.82 million as of August 27, 2021, marking a growth of 23.0%[15] - Total liabilities rose to $1.15 billion as of May 27, 2022, compared to $1.03 billion as of August 27, 2021, reflecting an increase of 12.5%[15] - Total assets as of May 27, 2022, increased to $1.55 billion, up from $1.34 billion as of August 27, 2021, representing a growth of 15.6%[15] - The company reported total equity of $399,069,000 as of May 27, 2022, an increase from $392,602,000 as of the previous period[24] Cash Flow and Investments - Cash flows from operating activities provided $84,025 thousand, compared to $105,328 thousand in the prior year, indicating a decrease of approximately 20.2%[29] - The company reported a net cash increase of $164,340 thousand, up from $38,181 thousand in the previous year, reflecting a growth of 329.5%[29] - Cash and cash equivalents increased to $387.33 million as of May 27, 2022, from $222.99 million as of August 27, 2021, marking an increase of 73.5%[15] - The company reported capital expenditures of $29,298,000 for the nine months ended May 27, 2022, down from $40,017,000 in the same period of 2021, reflecting a reduction of about 26.5%[29] Research and Development - The company invested $20.30 million in research and development for the three months ended May 27, 2022, up from $16.72 million in the same period last year, an increase of 21.0%[18] - Research and development expenses rose by $3.6 million, or 21.4%, in Q3 2022, and by $24.2 million, or 74.4%, for the first nine months of 2022 compared to the same period in the prior year[149] Shareholder Activities - The company issued 1,243 shares under equity plans, resulting in an increase of $4,389,000 in additional paid-in capital[24] - SMART Global Holdings repurchased ordinary shares amounting to $(13,905,000) during the period ending May 27, 2022[24] - The company reported a treasury stock value of $(67,345,000) as of May 27, 2022, reflecting ongoing share repurchase activities[24] Acquisitions and Future Plans - The acquisition of Stratus Technologies is expected to close by the end of calendar year 2022, with a cash purchase price of $225 million and potential contingent consideration of up to $50 million based on performance[34][36] - The acquisition of the LED Business from Cree, Inc. was completed for a total consideration of $72.4 million in cash and a promissory note of $125 million, with potential earn-out payments based on performance[130][131] Segment Performance - Memory Solutions segment reported net sales of $265.85 million for the three months ended May 27, 2022, an increase of 10.5% from $240.12 million in the same period of 2021[124] - Intelligent Platform Solutions segment achieved net sales of $95.35 million for the three months ended May 27, 2022, slightly down from $95.86 million in the prior year[124] - LED Solutions segment generated net sales of $101.35 million for the three months ended May 27, 2022, consistent with $101.76 million in the same period of 2021[124] Economic and Market Conditions - The global semiconductor shortage has adversely affected the company's operating results, highlighting the risks associated with reliance on third-party suppliers[137] - The company anticipates that macro-economic factors, including the COVID-19 pandemic, may impact demand across its business segments, particularly in Brazil[134] Accounting and Compliance - The company adopted several accounting standards in 2022, including ASU 2021-08, which had no significant impact on financial statements[37] - A share dividend was declared on January 3, 2022, with one ordinary share for every one outstanding ordinary share, impacting the financial statements accordingly[36]