0001104659-09-035322 8-K 2 20090527 2.02 5.02 9.01 20090528 20090528 NETLIST INC 0001282631 3674 954812784 DE 8-K 34 001-33170 09856808 475 GODDARD IRVINE CA 92618 8-K 1 a09-14388_18k.htm 8-K

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


 

Form 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported):  March 27, 2009

 

Netlist, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware

 

001-33170

 

95-4812784

(State or other jurisdiction
of incorporation)

 

(Commission
File Number)

 

(IRS Employer
Identification No.)

 

 

 

 

 

51 Discovery, Irvine, California

 

92618

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code:  (949) 435-0025

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 



 

Item 2.02       Results of Operations and Financial Condition.

 

On March 27, 2009, Netlist, Inc. (the “Company”) issued a press release announcing the Company’s results of operations for the fourth quarter and full fiscal year ended January 3, 2009. The press release is attached hereto as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein in its entirety.

 

The information included in this Item 2.02 of Current Report on Form 8-K, including the attached Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 5.02       Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers; Compensatory Arrangement of Certain Officers.

 

On May 25, 2009, James Perrott informed the Company of his decision to resign from his position of SVP of Engineering and Marketing, due to personal reasons.  His resignation is effective May 29, 2009.

 

Item 9.01       Financial Statements and Exhibits.

 

d) Exhibits

 

Exhibit

 

 

Number

 

Description

 

 

 

99.1

 

Press Release, dated March 27, 2009.

 

2



 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: May 26, 2009

NETLIST, INC.

 

 

 

 

 

/s/ Gail Itow

 

Gail Itow

 

Vice President and Secretary

 

3


EX-99.1 2 a09-14388_1ex99d1.htm EX-99.1

Exhibit 99.1

 

Netlist Reports Fourth Quarter, Year-End Results

Announces New Strategic Focus on Chip Development

 

IRVINE, Calif., March 27 /PRNewswire-FirstCall/ — Netlist, Inc. (Nasdaq: NLST) today reported financial results for the fourth quarter and year ended January 3, 2009. Revenues for the fourth quarter ended January 3, 2009, were $6.6 million compared to $22.5 million for the fourth quarter ended December 29, 2007. Negative gross profit for the fourth quarter ended January 3, 2009, was $283,000, or a negative gross margin of 4.3 percent, compared with a gross profit of $5.1 million, or a gross margin of 22.7 percent, in the year-earlier period. Revenues for the year ended January 3, 2009, were $67.0 million, compared to $100.1 million for the prior year. Gross profit for the year ended January 3, 2009, was $7.6 million, or a gross margin of 11.3 percent, compared to a gross profit of $8.8 million, or a gross margin of 8.8 percent, for the year ended December 29, 2007.

 

Net loss for the fourth quarter ended January 3, 2009, was $5.0 million, or $0.25 loss per share, compared to a net loss in the prior year period of $171,000, or $0.01 loss per share. Fully diluted weighted-average shares outstanding for the fourth quarter ended January 3, 2009, were 19,855,000, compared to 19,730,000 in the corresponding year-earlier period. These results include stock-based compensation expense in the fourth quarter ended January 3, 2009 of $296,000, compared with $247,000 in the prior year period. Net loss for the year ended January 3, 2009, was $15.2 million, or $0.77 loss per share, compared to a net loss in the prior year of $7.4 million, or $0.38 loss per share. The net loss for the year ended January 3, 2009, includes a non-cash provision for income taxes of $4.5 million which was recorded during the third quarter to establish a partial valuation allowance against deferred tax assets.

 

As of January 3, 2009, cash, cash equivalents, and investments in marketable securities were $21.4 million, total assets were $34.9 million, working capital was $22.3 million, total long-term debt was $130,000, and stockholders’ equity was $30.2 million.

 

The Company also announced that it will migrate away from the commoditized memory module market and focus on higher-margin, longer-lifecycle chip-based products.

 

“The memory module markets were lucrative until the combination of crashing DRAM prices and an abundance of low-cost competition resulted in a fully commoditized marketplace,” Chief Executive Officer Chuck Hong said. “While we have identified certain memory module programs where we can still bring value, our principle development efforts will now be directed to new chip-based technologies that better fit the changing needs of the computing and storage marketplace.”

 

Hong said the Company is currently engaged in major OEM qualification activities with new products based on its DxD chipset and should begin to drive new revenue streams next year.

 

“While revenue in the next few quarters will continue to be impacted by our choice to not participate in certain markets, the combination of higher-value module programs and the kick-off of new chip-based programs should allow for a reversal of recent revenue trends toward the end of the year and beyond,” Hong said. “The adoption of this new strategic focus has reinvigorated our entire company.”

 

Conference Call Information

 

As previously announced, Netlist is conducting a conference call today to be broadcast live over the Internet at 11:30 am Eastern Time to discuss and review the financial results for the fourth quarter and year ended January 3, 2009. The dial-in number for the call is 1-800-762-8779. The live webcast and archived replay of the call can be accessed in the Investors section of Netlist’s website at www.netlist.com.

 

About Netlist, Inc.

 

Netlist designs and manufactures high-performance memory subsystems for the server and high-performance computing and communications markets. The Company’s memory subsystems are developed for applications in which high-speed, high-capacity memory, functionality, small form factor, and heat dissipation are key requirements. These applications include tower-servers, rack-mounted servers, blade servers, high-performance computing clusters, engineering workstations, and telecommunication equipment. Netlist maintains its headquarters in Irvine, California with manufacturing facilities in Suzhou, China.

 



 

Safe Harbor Statement

 

This news release contains forward-looking statements regarding future events and the future performance of Netlist, including future opportunities and growth for the company’s business. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expected or projected. These risks and uncertainties include, but are not limited to, the rapidly-changing nature of technology; volatility in the pricing of DRAM ICs and NAND;changes in and uncertainty of customer demand, including delays in product qualifications; delays in our and our customers’ product releases and development; introductions of new products by competitors; changes in end-user demand for technology solutions; the Company’s ability to attract and retain skilled personnel; the Company’s reliance on suppliers of critical components; fluctuations in the market price of evolving industry standards; and the political and regulatory environment in the People’s Republic of China. Other risks and uncertainties are described in the Company’s annual report on Form 10-K, dated March 30, 2009, and subsequent filings with the U.S. Securities and Exchange Commission made by the Company from time to time. Netlist undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

Contact:

 

Allen & Caron Inc

 

Gail Itow

 

 

Jill Bertotti (investors)

 

Chief Financial Officer

 

 

jill@allencaron.com

 

Netlist, Inc.

 

 

Len Hall (media)

 

(949) 435-0025

 

 

len@allencaron.com

 

 

 

 

(949) 474-4300

 

 

 

TABLES FOLLOW

 



 

Netlist, Inc.

Unaudited Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

Year Ended

 

 

 

January 3,

 

December 29,

 

January 3,

 

December 29,

 

 

 

2009

 

2007

 

2009

 

2007

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

6,602

 

$

22,517

 

$

67,011

 

$

100,060

 

Cost of sales(1)

 

6,885

 

17,411

 

59,460

 

91,261

 

Gross profit

 

(283

)

5,106

 

7,551

 

8,799

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Research and development(1)

 

1,928

 

947

 

6,871

 

4,748

 

Selling, general and administrative(1)

 

2,787

 

4,311

 

12,929

 

15,900

 

Total operating expenses

 

4,715

 

5,258

 

19,800

 

20,648

 

Operating loss

 

(4,998

)

(152

)

(12,249

)

(11,849

)

Other income (expense):

 

 

 

 

 

 

 

 

 

Interest income, net

 

92

 

139

 

473

 

395

 

Other income (expense), net

 

(82

)

44

 

(137

)

16

 

Total other income, net

 

10

 

183

 

336

 

411

 

Income (loss) before provision (benefit) for income taxes

 

(4,988

)

31

 

(11,913

)

(11,438

)

Provision (benefit) for income taxes

 

(31

)

202

 

3,301

 

(4,025

)

Net loss

 

$

(4,957

)

$

(171

)

$

(15,214

)

$

(7,413

)

Net income (loss) per common share:

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.25

)

$

(0.01

)

$

(0.77

)

$

(0.38

)

Diluted

 

$

(0.25

)

$

(0.01

)

$

(0.77

)

$

(0.38

)

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

19,855

 

19,730

 

19,847

 

19,674

 

Diluted

 

19,855

 

19,730

 

19,847

 

19,674

 

 


(1) Amounts include stock-based compensation expense as follows:

 

Cost of sales

 

$

38

 

$

10

 

$

144

 

$

171

 

Research and development

 

39

 

44

 

179

 

149

 

Selling, general and administrative

 

219

 

193

 

954

 

861

 

 



 

Netlist, Inc.

Unaudited Condensed Consolidated Balance Sheets

(in thousands)

 

 

 

January 3,

 

December 29,

 

 

 

2009

 

2007

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

15,214

 

$

7,182

 

Investments in marketable securities

 

5,199

 

15,573

 

Accounts receivable, net

 

1,917

 

12,034

 

Inventories

 

1,829

 

3,333

 

Income taxes receivable

 

1,880

 

708

 

Deferred taxes

 

 

3,464

 

Prepaid expenses and other current assets

 

761

 

392

 

Total current assets

 

26,800

 

42,686

 

 

 

 

 

 

 

Property and equipment, net

 

6,939

 

8,191

 

Deferred taxes

 

 

1,065

 

Long-term investments in marketable securities

 

960

 

7,814

 

Other assets

 

234

 

600

 

Total assets

 

$

34,933

 

$

60,356

 

 



 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

1,786

 

$

6,697

 

Revolving line of credit

 

 

4,872

 

Current portion of long-term debt

 

474

 

740

 

Current portion of deferred gain on sale and leaseback transaction

 

118

 

118

 

Accrued expenses and other current liabilities

 

2,083

 

2,872

 

Total current liabilities

 

4,461

 

15,299

 

Long-term debt, net of current portion

 

130

 

638

 

Deferred gain on sale and leaseback transaction, net of current portion

 

108

 

226

 

Total liabilities

 

4,699

 

16,163

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Common stock

 

20

 

20

 

Additional paid-in capital

 

69,383

 

68,109

 

Accumulated deficit

 

(39,113

)

(23,899

)

Accumulated other comprehensive loss

 

(56

)

(37

)

Total stockholders’ equity

 

30,234

 

44,193

 

Total liabilities and stockholders’ equity

 

$

34,933

 

$

60,356

 

 

SOURCE Netlist, Inc.