Earnings before goodwill (EBG) for the quarter were $27.3 million ($0.24 per diluted share), a decrease of three percent from the $28.0 million ($0.26 per diluted share), excluding a one-time gain on foundry investments, reported in the same quarter last year and down 33 percent from last quarter’s EBG of $40.4 million ($0.34 per diluted share).
During the first quarter, Lattice added $14.0 million of cash to its balance sheet after routine capital expenditures of $3.9 million. Including March stock transactions that settled in April, Lattice repurchased 336,000 shares of common stock during the quarter for $6.2 million.
Inventory, as of March 2001, increased to $70.2 million and represents 5 months of cost of goods sold. Total inventory, including inventory held at distributors, represents 7 months.
The March quarter was a sobering one for Lattice and the semiconductor industry, stated Cyrus Y. Tsui, president and chief executive officer. Due to a rapid and steep decline in customer orders, we experienced the largest sequential quarterly revenue decline in our history. Revenue declined across all geographies and the communications end market was particularly weak.
On a more positive note, we are gratified by the high level of profitability we delivered in this challenging business environment, Tsui continued. Due to rapid implementation of discretionary spending controls, March quarter operating profit, on a before goodwill basis, exceeded 30 percent of revenue. In conjunction with these cost controls, we are continuing to invest in new product development activities which we believe will pay off when the semiconductor cycle turns positive.
Looking forward, the semiconductor market and the general economy remain weak. We enter the June quarter with a depleted backlog and do not anticipate a significant rebound in business. Consequentially we anticipate another double digit sequential revenue decline. Although our short-term outlook is highly uncertain, we are prepared to manage through a challenging business environment in 2001, Tsui concluded.
