Dialog Semiconductor Plc.: Dialog Semiconductor Announces its Results for the Third Quarter of 2009

Dialog Semiconductor Plc. / Quarter Results

27.10.2009 

Dissemination of an Ad hoc announcement according to §
15 WpHG, transmitted by DGAP - a company of EquityStory
AG.
The issuer is solely responsible for the content of
this announcement.


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Record results in third quarter with $59 million
revenue, achieving 31% growth over the second quarter
of 2009 
Kirchheim/Teck, Germany, 27th October 2009 - Dialog
Semiconductor plc (FWB: DLG), a leading provider of
high integrated innovative Power Management 
Semiconductor solutions, today reports results for its
third quarter ending 25th September 2009.

Q3 2009 Financial Highlights   

  - Revenue for Q3 2009 was $59.0 million, an increase
of 31% over the     prior quarter and 34% over the
corresponding quarter of 2008 
   - Net profit in Q3 2009 of $8.8 million or 14.8% of
revenue compared to     $3.3 million in prior quarter,
our eighth successive quarter of     profitability
  
  - Diluted and Basic earnings per share of 18 cents
and 19 cents     respectively

  - Total cash increased in Q3 2009 by $2.9 million to
stand at $46.4     million

  - Subsequent to quarter end, Dialog received
approximately $59.8 million     proceeds from an
international equity offering 
  - Inclusion in the German technology TecDAX index 


Q3 2009 Operational Highlights   

  - Strategic entrance to audio market with the launch
of the DA7210 -     first product from a family of new
ultra low power and high quality     audio products

  - Cooperation with NEC Electronics for a platform to
enable rapid     prototyping of smartphones and
portable media devices 
  - Continued ramp of our power management technology
into leading     smartphone manufacturers' products

  - First DA6001 engineering samples shipped of a
power management     companion device for Intel's(R)
Atom(TM) processor -  to Harman Becker     for
Infotainment and announcement of continued
collaboration 


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Information and Explaination of the Issuer to this
News: 
Commenting on the results Dialog Chief Executive, Dr
Jalal Bagherli, said: 
'Dialog continued its growth momentum in the third
quarter where we experienced strong demand for our
power management products. Dialog's strategy combined
with solid execution are yielding positive operating 
results for the company as we continue to increase our
market share.

I am very pleased that these positive results today
are being enjoyed by both long-standing and new Dialog
shareholders. During the quarter, we embarked on a very
successful international equity offering and have been 
able to attract a significant number of new Tier 1
institutional funds to our shareholder base in addition
to increasing our trading liquidity.' 
FINANCIAL OVERVIEW

Revenue in Q3 2009 was $59.0 million, an increase of
31% over the $45.0 million in the prior quarter and an
increase of 34% on the $44.0 million of revenue
delivered in the corresponding quarter of 2008.

Gross margin for the third quarter was 45.3%,
representing a decrease of 0.4 percentage points over
that achieved in the prior quarter and an increase of
4.4 percentage points over that achieved in Q3 2008.
The gross margin in the prior quarter was positively
impacted by $2.0 million or 2.4 percentage points due
to a cash settlement received from the BenQ insolvency.

In Q3 2009, net profit was $8.8 million or 18 cents
and 19 cents per diluted and basic share respectively,
our eighth consecutive quarter of profitability. This
compares to a net profit of $3.3 million or 7 cents per 
share (diluted and basic) in the prior quarter and to
a net profit of $1.9 million or 4 cents per share
(diluted and basic) delivered in Q3 2008.

At the end of Q3 2009, we had a cash, cash equivalents
and restricted cash balance of $46.4 million. This
represents an increase of $2.9 million over the cash,
cash equivalents and restricted cash balance at the
end of Q2 2009 and an increase of $9.5 million over the
cash and cash equivalents balance at the end of 2008.

At the end of Q3 2009, our inventory level was $26.2
million, an increase of $7.2 million over the prior
quarter.  This increase is in line with the increased
seasonal demand for our products as we enter Q4 2009.
During Q3 2009, we continued to tightly manage our
Operating Expenses achieving an SG&A rate of 10% and
R&D rate of 19% of revenue.

The effective tax rate for year to date was 12.2%.
Going forward, we will consider whether it is
appropriate to utilise currently unrecognised deferred
tax assets against future identifiable taxable profits
which would then offset the effective tax charge for
the full year 2009.

Following a long standing commitment to Dialog, Apax
Partners LLP - the global private equity advisory firm
that led the leveraged buyout of the Company in 1998 -
18.3 percent shareholding of Dialog was placed with 
quality institutional investors during Q3 2009.

An international equity offering was launched during
the quarter, with the subscription being approximately
3 times oversubscribed. 12 million new ordinary shares
were priced at EUR3.65, representing a premium of 4
percent to the price on the offer announcement date.
The shares were placed with a number of Tier 1
institutional investors. Subsequent to shareholder 
approval at a General Meeting, proceeds of
approximately $59.8 million were received in October.
The proceeds from the offering will be used to expand 
our design and technical support teams, particularly
in the US and Asia; acquire complementary technology
and intellectual property; and increase our working
capital resources to fund future growth.

During Q3 2009, Dialog has been included in the TecDAX
index. This index tracks the 30 most actively traded
technology companies, excluding those listed in the
German DAX index and is amongst the most important and 
leading stock indices in Germany.

OPERATIONAL OVERVIEW

WIRELESS

Globally, the transition to smartphones continues at a
rapid pace. We are benefiting from this transition
through our participation with three leading vendors.
As 3G technology continues to be aggressively promoted 
worldwide by the carriers, both in cellphones and data
modems for netbook type products, our 3G/HSPA platform
business also saw increased shipments during the
quarter. Additionally, we experienced typically strong
seasonal demand for our portable media products.

As a result of a strategic initiative to expand our
product portfolio, during the period we launched the
DA7210 - a standalone audio device. This is the first
member of a family of new ultra low power audio
products which are currently under development.
Expansion into the audio segment significantly expands
the addressable market for our mixed signal technology
and allows us to offer our customer a new class of
audio technology, combined with and built upon our
power management expertise.
First engineering samples are already under evaluation
at key lead customers.

Our Smartxtend(TM) passive matrix OLED developments
remain on track for industry adoption within the
portable device and cellphone markets. We expect to
sample our first customers in Q4 2009.This technology
delivers a strong value proposition over traditional
TFT LCD displays and active matrix OLED competing
technologies. Dialog maintains its early leadership for
e-paper/e-ink display based products, winning designs
in innovative portable applications.

AUTOMOTIVE & INDUSTRIAL

During the third quarter we experienced some recovery
in our automotive business. Given our current
visibility, we expect shipment to grow in Q4 reaching
our historical levels of sales. However, overall the
longer-term visibility in the automotive market still
remains low.

We announced that the first engineering samples were
shipped to Harman Becker of the DA6001 power management
and clocking IC as a companion device for the Intel (R)
Atom(TM) processor. This will be used in Harman
Becker's automotive infotainment systems and is the
highest integrated solution available on the market,
offering significant cost and board space savings.
Additionally, our plan to continue collaborating with
Harman Becker on a 'next generation' device supporting
Intel's forthcoming Atom processor was also announced.

OUTLOOK

As we enter our traditionally strong seasonal fourth
quarter, Dialog continues to see increasing demand for
its products used in smartphones and portable media
devices, in addition to resurgence in demand for
automotive related products. We maintain the outlook
issued on October 12th 2009 in our trading update and
believe that revenue and operating profit for the full
year 2009 should break through the $200 million and
10% margin levels respectively.

Dialog Semiconductor invites you today at 11 am CET to
listen in a live conference call to management's
discussion of Q3 2009 performance, as well as guidance
for financial 2009. To access the call please use the
following dial-in numbers: Germany: +44 (0)1452 569
393, UK: 0845 146 2004, US: 1 866 434 1089 with
conference ID for all countries 35980584 required. An
instant replay facility will be available for 30 days
after the call and can be accessed at +44 (0)845 245
5205 with access code 35980584. An audio replay of the
conference call will also be posted soon thereafter on
the company's website at:

http://www.diasemi.com/investor_relations.php

Additional information to this adhoc release including
the company's consolidated income statement,
consolidated balance sheet and consolidated statements
of cash flows for the period ending 25th September
2009 is available under the investor relations section
of the Company's web site.

For further information please contact:

Dialog Semiconductor    FD - London          FD -
Frankfurt         Neue Strasse  Matt Dixon/         
Claudine Schaetzle/ D-73230 Kirchheim/Teck  Erwan
Gouraud        Lucie Kimmich Germany                 T
+44 20 7831 3113   T +49 69 920 37 185                 
                  dialog@fd.com        dialog@fd.com T:
+49 7021 805 412                                      
                  dialog@fd.com                        
                                      
www.dialog-semiconductor.com 
Note to editors:

Dialog Semiconductor creates energy-efficient, highly
integrated, mixed-signal circuits optimised for
personal mobile, lighting & display and automotive
applications. The company provides flexible and
dynamic support, world-class innovation and the
assurance of dealing with an established business
partner.

With its unique focus and expertise in system power
management, Dialog brings decades of experience to the
rapid development of integrated circuits for power
management, audio, display processing and motor
control.
Dialog's processor companion chips are essential for
enhancing both the performance of hand-held products
and the consumers' multimedia experience.
With world-class manufacturing partners, Dialog
operates a fabless business model.

Dialog Semiconductor plc is headquartered near
Stuttgart with a global sales, R&D and marketing
organisation. In 2008, it had more than $160 million in
revenue and was the fastest growing European public 
semiconductor company, achieving a growth rate of more
than 85%. It currently has approximately 325 employees.
The company is listed on the Frankfurt (FWB: DLG) stock
exchange.

Forward Looking Statements

This press release contains 'forward-looking
statements' that reflect management's current views
with respect to future events. The words 'anticipate,'
'believe,' 'estimate, 'expect,' 'intend,' 'may,'
'plan,' 'project' and 'should' and similar expressions
identify forward-looking statements. Such statements
are subject to risks and uncertainties, including, but
not limited to: an economic downturn in the
semiconductor and telecommunications markets; changes
in currency exchange rates and interest rates, the
timing of customer orders and manufacturing lead times, 
insufficient, excess or obsolete inventory, the impact
of competing products and their pricing, political
risks in the countries in which we operate or sale and
supply constraints. If any of these or other risks and 
uncertainties occur (some of which are described under
the heading 'Risks and their management' in Dialog
Semiconductor's most recent Annual Report) or if the
assumptions underlying any of these statements prove
incorrect, then actual results may be materially
different from those expressed or implied by such
statements. We do not intend or assume any obligation
to update any forward-looking statement, which speaks
only as of the date on which it is made, however, any
subsequent statement, will supercede any previous
statement.

27.10.2009  Financial News transmitted by DGAP


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