Continued strong demand in fiscal Q2 - Smart Modular

Wednesday, March 30, 2011

US semiconductor manufacturer Smart Modular Technologies (Nasdaq: SMOD) continued to see high demand in its Brazilian business during its fiscal 2Q11, ended February 25, company president and CEO Iain MacKenzie said during a conference call with investors.

"We continue to expand our Brazilian footprint. February 1 marked the successful split of our local operations into two operating companies - semiconductor and module. This positions us for meaningful reductions in taxes we pay in Brazil," where the company has a factory, the executive said.

"We have committed to lease an additional 45,000-square-foot space adjacent to our existing Brazil facility. We look forward to significant long-term returns from our deeper and broader penetration into this market as a result of these investments," MacKenzie added.

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Company CFO Barry Zwarenstein said Brazilian sales accounted for 48% of total quarterly revenues.

Globally, the company posted net sales of US$170mn in fiscal Q2, compared with US$216mn for the previous quarter and US$160mn for fiscal 2Q10, Smart Modular said in its earnings statement.

Meanwhile, net income for fiscal Q2 was some US$200,000, compared with a net profit of US$16.1mn in the year-ago quarter. The latest net income includes restructuring charges of US$2.8mn related to the closing of the company's Puerto Rico facility.

Smart has developed a comprehensive memory product line that includes DRAM, SRAM and Flash memory in various form factors.