Wolfson Microelectronics plc (“Wolfson” or “the Company”), a leading supplier of mixed-signal semiconductors for consumer electronic products, announces fourth quarter and audited full year results for 2007. 

Fourth quarter 2007 highlights: 

• Revenues up 36% to a record $71.6m (Q4 2006: $52.6m)
• Adjusted operating profit* up 33% to $14.3m (Q4 2006: $10.8m)
• Operating profit up 20% to $13.0m (Q4 2006: $10.8m)
• Adjusted diluted earnings per share* up 36% to 9.2 cents (Q4 2006: 6.7 cents)
• Diluted earnings per share up 24% to 8.4 cents (Q4 2006: 6.7 cents)
• Sales into handsets up 52% year on year and 11% sequentially

Full year 2007 financial highlights:

• Revenue increased by 13.5% to $231.6m (2006: $204.1m)
• Gross margin improved 70 basis points to 52.5% (2006: 51.8%)
• Like for like adjusted operating profit ** $43.0m (2006: $46.9m)
• Operating profit $36.9m (2006: $41.1m after non recurring charge)
• Adjusted diluted earnings per share * 26.2 cents (2006: 30.1 cents)
• Like for like adjusted diluted earnings per share ** 29.1 cents (2006: 30.1 cents)
• Diluted earnings per share 24.8 cents (2006: 26.7 cents after non recurring charge)
• Net cash inflow from operating activities up 37% to $52.5m (2006: $38.5m)
• Net cash balance at 30 December 2007 of $90m (2006: $99m)

Full year 2007 operational highlights:

• Launched Wolfson’s AudioPlus™ strategy, integrating incremental mixed-signal technologies with our renowned audio capabilities
• Acquired and integrated Oligon Limited and Sonaptic Limited, accelerating implementation of AudioPlus™ strategy
• Began volume sales of our WM8350 chip: the first in a family of AudioPlus™ Smart Power devices which integrate power management with our renowned audio technology 
• Portable segment revenue up 14% to $172m (2006: $151m) driven by strong growth in portable navigation devices, digital cameras and Bluetooth headsets
• Consumer audio segment revenues rose 26% to $40m (2006: $31m) reflecting excellent growth in flat panel TV and PC accessories
• Launched 16 new products in 2007 taking portfolio to 122 products
• Strengthened US and European sales management teams; Mike Ruettgers appointed as Chairman

Outlook

• First quarter revenues forecast to be in the range of $44m-$48m, up 10% to 20% on Q1 2007
• First quarter gross margins expected to remain stable in the 52-53% range
• Addressable market opportunity trebled through AudioPlusTM strategy with material benefits emerging in 2008
• Expecting solid growth in 2008 despite uncertain market conditions

Commenting on the results, Dave Shrigley, Chief Executive, said: “Despite challenging market conditions during the first half of 2007, Wolfson has again outperformed the industry with strong revenue growth in the fourth quarter and the full year. This is a great testament to the Company’s resilience and the quality of its business.

The AudioPlus™ strategy has already received positive traction with existing and potential new customers, demonstrating the benefits of an expanded addressable market opportunity. With recent design win momentum, new products coming on stream and its broad portfolio base, Wolfson expects to deliver a further year of solid growth and will continue to build long term value for shareholders. ”


*Adjusted means after adding back amortisation of acquired intangible assets, and in 2006 adding back the non recurring charge. For earnings per share purposes, this is calculated by adding back to net profit such cost net of the estimated tax impact and dividing by the number of shares in issue on a fully diluted basis
** Like for like adjusted means after adding back the costs incurred by the acquired businesses (deducting any revenues generated), adding back amortisation of acquired intangible assets, and in 2006 adding back the non recurring charge. For earnings per share purposes, this is calculated by adding back to net profit such costs net of the estimated tax impact of such costs and dividing by the number of shares in issue on a fully diluted basis. Refer to first table below for detailed calculations.


Dave Shrigley, CEO and Mark Cubitt, Finance Director, will be hosting a presentation to investors and analysts at 09.30 GMT at JP Morgan Cazenove, 20 Moorgate, London, EC2R 6DA. An audio webcast of the Wolfson Microelectronics plc Full Year Results and presentation can be heard LIVE from 09.30 GMT via http://www.wolfsonmicro.com/investor or www.streetevents.com 

Additionally, there is a dial in facility: 
UK Dial-in +44 207 0705412
US Dial-in +1 866 4327186

Enquiries:

Wolfson Microelectronics
Dave Shrigley, Chief Executive
Mark Cubitt, Finance Director 
T: 0131 272 7000

Corfin Communications
Harry Chathli, Neil Thapar
 T: 020 7977 0020