UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to _____________
Commission File Number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer |
(Address of principal executive offices) |
(Zip Code) |
(
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of November 1, 2023, the registrant had
TABLE OF CONTENTS
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Page |
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2 |
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PART I. |
3 |
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Item 1. |
3 |
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Condensed Consolidated Balance Sheets as of September 29, 2023 and March 31, 2023 (Unaudited) |
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4 |
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5 |
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6 |
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8 |
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Notes to Unaudited Condensed Consolidated Financial Statements |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
19 |
Item 3. |
29 |
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Item 4. |
29 |
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PART II. |
30 |
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Item 1. |
30 |
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Item 1A. |
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Item 2. |
30 |
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Item 5. |
30 |
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Item 6. |
31 |
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32 |
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding our future results of operations and financial position, business strategy, prospective products and the plans and objectives of management for future operations, may be forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
Statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, including, among others, statements regarding the liquidity, growth and profitability strategies and factors and trends affecting our business are forward-looking statements. Without limiting the foregoing, in some cases, you can identify forward-looking statements by terms such as “aim,” “may,” “will,” “should,” “expect,” “exploring,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “would,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” “seek,” or “continue” or the negative of these terms or other similar expressions, although not all forward-looking statements contain these words. No forward-looking statement is a guarantee of future results, performance, or achievements, and one should avoid placing undue reliance on such statements.
Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to us. Such beliefs and assumptions may or may not prove to be correct. Additionally, such forward-looking statements are subject to a number of known and unknown risks, uncertainties and assumptions, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, those identified in Part I, Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Part II, Item 1A. “Risk Factors” in this Quarterly Report and Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended March 31, 2023, filed with the Securities and Exchange Commission (“SEC”) on May 25, 2023 (the “2023 Annual Report”) as any such factors may be updated from time to time in our Quarterly Reports on Form 10-Q, and our other filings with the SEC.
You should read this Quarterly Report and the documents that we reference completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. All forward-looking statements speak only as of the date of this Quarterly Report, and except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements, whether as a result of any new information, future events, changed circumstances or otherwise.
Unless the context otherwise requires, references to “we,” “us,” “our,” the “Company” and “Allegro” refer to the operations of Allegro MicroSystems, Inc. and its consolidated subsidiaries.
2
PART I – FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
ALLEGRO MICROSYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except par value and share amounts)
(Unaudited)
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September 29, |
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March 31, |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Restricted cash |
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Trade accounts receivable, net |
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Trade and other accounts receivable due from related party |
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Inventories |
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Prepaid expenses and other current assets |
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Current portion of related party note receivable |
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Total current assets |
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Property, plant and equipment, net |
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Operating lease right-of-use assets |
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Deferred income tax assets |
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Goodwill |
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Intangible assets, net |
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Related party note receivable, less current portion |
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Equity investment in related party |
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Other assets |
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Total assets |
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$ |
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$ |
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Liabilities, Non-Controlling Interests and Stockholders’ Equity |
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Current liabilities: |
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Trade accounts payable |
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$ |
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$ |
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Amounts due to related party |
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Accrued expenses and other current liabilities |
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Current portion of operating lease liabilities |
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Total current liabilities |
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Obligations due under Senior Secured Credit Facilities |
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Operating lease liabilities, less current portion |
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Other long-term liabilities |
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Total liabilities |
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Stockholders' Equity: |
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Preferred stock, $ |
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Common stock, $ |
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Additional paid-in capital |
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Retained earnings |
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Accumulated other comprehensive loss |
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( |
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( |
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Equity attributable to Allegro MicroSystems, Inc. |
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Non-controlling interests |
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Total stockholders’ equity |
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Total liabilities, non-controlling interests and stockholders’ equity |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
3
ALLEGRO MICROSYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(Unaudited)
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Three-Month Period Ended |
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Six-Month Period Ended |
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September 29, |
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September 23, |
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September 29, |
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September 23, |
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Net sales |
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$ |
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$ |
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$ |
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$ |
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Net sales to related party |
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Total net sales |
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Cost of goods sold |
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Cost of goods sold to related party |
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Gross profit |
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Operating expenses: |
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Research and development |
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Selling, general and administrative |
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Total operating expenses |
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Operating income |
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Other income (expense): |
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Interest expense |
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( |
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( |
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Interest income |
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Other income (expense), net |
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( |
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Income before income taxes |
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Income tax provision |
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Net income |
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Net income attributable to non-controlling interests |
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Net income attributable to Allegro MicroSystems, Inc. |
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$ |
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$ |
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$ |
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$ |
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Net income per common share attributable to Allegro |
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Basic |
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$ |
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$ |
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$ |
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$ |
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Diluted |
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$ |
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$ |
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$ |
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$ |
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Weighted average shares outstanding: |
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Basic |
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Diluted |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
4
ALLEGRO MICROSYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
(Unaudited)
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Three-Month Period Ended |
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Six-Month Period Ended |
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September 29, |
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September 23, |
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September 29, |
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September 23, |
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Net income |
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$ |
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$ |
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$ |
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$ |
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Net income attributable to non-controlling interests |
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Net income attributable to Allegro MicroSystems, Inc. |
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Other comprehensive loss: |
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Foreign currency translation adjustment, net of tax |
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( |
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( |
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( |
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( |
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Comprehensive income |
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Other comprehensive gain attributable to non-controlling interests |
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Comprehensive income attributable to Allegro MicroSystems, |
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$ |
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$ |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
5
ALLEGRO MICROSYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in thousands, except share amounts)
(Unaudited)
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Preferred Stock |
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Common Stock |
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Additional |
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Retained |
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Accumulated |
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Non-Controlling |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Earnings |
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Loss |
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Interests |
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Total Equity |
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Balance at June 24, 2022 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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Net income |
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— |
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— |
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— |
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— |
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— |
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— |
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Employee stock purchase plan issuances |
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— |
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— |
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— |
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— |
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— |
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Stock-based compensation, net of forfeitures |
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— |
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— |
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— |
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— |
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— |
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— |
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Foreign currency translation adjustment |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
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( |
) |
Balance at September 23, 2022 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
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$ |
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Preferred Stock |
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Common Stock |
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Additional |
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Retained |
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Accumulated |
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Non-Controlling |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Earnings |
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Loss |
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Interests |
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Total Equity |
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Balance at June 30, 2023 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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Net income |
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— |
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— |
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— |
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— |
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— |
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— |
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Stock-based compensation, net of forfeitures |
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— |
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— |
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— |
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— |
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— |
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Payments of taxes withheld on net settlement of equity awards |
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— |
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— |
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— |
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— |
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( |
) |
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— |
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— |
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— |
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( |
) |
Foreign currency translation adjustment |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
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( |
) |
Balance at September 29, 2023 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
6
ALLEGRO MICROSYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY – continued
(in thousands, except share amounts)
(Unaudited)
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Preferred Stock |
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Common Stock |
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Additional |
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Retained |
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Accumulated |
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Non-Controlling |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Earnings |
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Loss |
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Interests |
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Total Equity |
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Balance at March 25, 2022 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
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$ |
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Net income |
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— |
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— |
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— |
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— |
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— |
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— |
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Employee stock purchase plan issuances |
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— |
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— |
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— |
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— |
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— |
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Stock-based compensation, net of forfeitures |
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— |
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— |
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— |
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— |
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— |
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Payments of taxes withheld on net settlement of equity awards |
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— |
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— |
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— |
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— |
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( |
) |
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— |
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— |
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— |
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( |
) |
Foreign currency translation adjustment |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
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( |
) |
Balance at September 23, 2022 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
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$ |
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Preferred Stock |
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Common Stock |
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Additional |
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Retained |
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Accumulated |
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Non-Controlling |
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Shares |
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Amount |
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Shares |
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Amount |
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|
Capital |
|
|
Earnings |
|
|
Loss |
|
|
Interests |
|
|
Total Equity |
|
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Balance at March 31, 2023 |
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$ |
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