International Rectifier Corp. has reported second-quarter 2013 loss per share of 44 cents, better than the Zacks Consensus Estimate of 47 cents loss per share.
The company reported revenues of $223.8 million, down 2.7% year over year due to weak demand across all business segments.
Power management devices revenue decreased 8.3% year over year to $83.3 million; Energy saving products revenue decreased 18.6% to $36.2 million; Enterprise power revenue decreased 24.2% to $28.6 million; Automotive products revenue declined 1.5% to $28.4 million while HiRel revenue dropped 2.8% to $47.1 million.
Intellectual property revenue was $0.25 million in the quarter.
Reported gross margin for the quarter was 21.9% versus 35.4% in the year-ago quarter. The lower gross margins were due to higher absorption costs and lower utilization rates in the quarter.
Operating expenses (SG&A and R&D) of $77.2 million decreased 6.8% year over year due to solid expense management. However, the reported operating loss decreased significantly from the year-ago quarter. R&D expense increased as a percentage of sales from the year-ago quarter. Moreover, lower gross margins led to the operating margin contraction.
The quarter’s GAAP net loss was $32.7 million or loss per share of 47 cents, compared with a net loss of $6.3 million or loss of 9 cents in the comparable quarter last year. Excluding special items, non-GAAP net loss was $30.3 million or loss per share of 44 cents compared with net loss of $2.7 million or loss of 4 cents a share in the year-ago quarter.
The company has a cash and cash equivalents, restricted cash and short-term investments balance of $377.4 million, up from $356.2 million in the prior quarter. Trade receivables were $134.0 million, down from $151.6 million in the prior quarter.
Cash flow from operations was $41.9 million, up from $6.5 million in the prior quarter. Capex was $26.1 million versus $22.0 million in the prior quarter.
For the third quarter of 2013, International Rectifier expects total revenue in the range of $220–$235 million, representing a sequential increase of 1.7% at the mid-point. Gross margins are expected in the range of 22% to 23%, research and development expense of $31 million, sales, general and administrative expenses are expected to remain flat at about $45 million, and restructuring and other charges of $2 to $3 million, resulting from the resizing of manufacturing facilities and other cost reduction efforts. Net other expense is expected to be about $1 million and tax amount in the range of $2 million to $3 million, mainly due to foreign tax accruals.
For the third quarter, cash capital expenditure is expected to be about $23 million.
International Rectifier designs, manufactures, and markets analog integrated circuits (ICs) and power components, focused on power management applications. Though the company reported a disappointing quarter, the loss incurred was narrower than expected.
In the quarter, the company performed poorly with both its revenue and gross margins decreasing from the year-ago quarter. However, the company increased its cash ba