01—Abstract
Summary
Summary of the 10-K/A filed February 2, 2015. Cited figures are marked; the original filing is the authoritative source.
This filing is Part III of Skyworks Solutions, Inc.'s annual report for fiscal year 2014 (ended October 3, 2014), which incorporates information on directors, executive officers, executive compensation, security ownership, related transactions and auditor fees rather than financial statements.
As of January 15, 2015, David J. Aldrich served as Chairman and Chief Executive Officer, Liam K. Griffin as President, and Donald W.
Palette as Executive Vice President and Chief Financial Officer. The Board had 8 directors, and the filing states that a majority, including the Audit Committee members, are independent under NASDAQ rules. For fiscal 2014 the Named Executive Officers earned their maximum short-term incentive payouts, as the company's revenue and non-GAAP operating margin both exceeded the maximum performance levels.
Aldrich's total reported compensation was $6,912,623a. Stockholders approved the named executive officers' compensation at approximately 96% of votes cast at the 2014 Annual Meeting. The filing also discloses that the company issued 190,819,868 shares of common stock outstanding as of January 15, 2015.
The filing describes new Change in Control / Severance Agreements effective January 22, 2015, which provide for two times salary and incentive payments on a qualifying termination after a change in control. It also notes that the Chief Executive Officer's excise tax gross-up right was waived in December 2014. KPMG LLP's total fees were $1,652,550b for fiscal 2014, of which $1,561,650 was for audit fees.
02—Key points
Key Highlights
- Leadership as of January 15, 2015: David J. Aldrich is Chairman and CEO, Liam K. Griffin is President, and Donald W. Palette is EVP and CFO.
- Fiscal 2014 short-term incentive awards paid at the maximum level for all Named Executive Officers, because revenue and non-GAAP operating margin exceeded the maximum performance levels.
- Aldrich's fiscal 2014 total compensation was $6,912,623 per the Summary Compensation Table.
- Stockholders approved named executive officer compensation with approximately 96% of votes cast at the 2014 Annual Meeting.
- New Change in Control / Severance Agreements effective January 22, 2015 provide two times salary plus incentive on qualifying terminations, and Aldrich waived his excise tax gross-up right.
- KPMG LLP total fees were $1,652,550 for fiscal 2014, with audit fees of $1,561,650 (95% of total).
- Largest disclosed holders as of January 15, 2015 were BlackRock, Inc. (7.93%), Wellington Management Company, LLP (6.46%) and The Vanguard Group, Inc. (5.29%).
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2015, Skyworks Solutions kept $0.24.
- Revenue$3.26B100.0%
- Cost of revenue−$1.70B52.3%
- Gross profit$1.55B47.7%
- Operating costs−$531.4M16.3%
- Operating income$1.02B31.4%
- Interest, other & tax−$224.8M6.9%
- Net income$798.3M24.5%
Where FY2015 revenue went
$3.26B- Cost of revenue: $1.70B, 52% of revenue
- Net income: $798.3M, 24% of revenue
- R&D: $303.2M, 9.3% of revenue
- SG&A: $191.3M, 5.9% of revenue
- Other operating costs: $36.9M, 1.1% of revenue
- Interest, other & tax: $224.8M, 6.9% of revenue
Kept 24% as net incomeOther operating costs $36.9M · 1.1%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-K/AFY2015filed February 2, 2015Financial Statements
FY2015 against FY2014
| Line item | FY2015FY2014 | Change |
|---|---|---|
| Revenue | $3.26B$2.29B | +42.2% |
| Cost of Revenue | $1.70B$1.27B | +34.3% |
| Gross Profit | $1.55B$1.02B | +52.0% |
| R&D Expenses | $303.20M$252.20M | +20.2% |
| SG&A Expenses | $191.30M$179.10M | +6.8% |
| Operating Expenses | $531.40M$457.50M | +16.2% |
| Operating Income | $1.02B$565.20M | +81.0% |
| Net Income | $798.30M$457.70M | +74.4% |
| EPS (Basic) | $4.21$2.44 | +72.5% |
| EPS (Diluted) | $4.10$2.38 | +72.3% |
| Shares Outstanding (Basic) | 189.50M187.20M | +1.2% |
| Shares Outstanding (Diluted) | 194.90M192.60M | +1.2% |
05—Questions
Frequently Asked Questions
Who are the company's directors and executive officers?
The Board includes David J. Aldrich (Chairman and CEO), David J. McLachlan (Lead Independent Director), Kevin L. Beebe, Timothy R. Furey, Balakrishnan S. Iyer, Christine King, David P. McGlade and Robert A. Schriesheim. Executive officers are Liam K. Griffin (President), Donald W. Palette (EVP and CFO), Bruce J. Freyman (EVP, Worldwide Operations), Mark V.B. Tremallo (VP, General Counsel and Secretary) and Victoria Vezina (VP, Human Resources).
How was executive pay tied to performance in fiscal 2014?
Short-term incentives were based equally on revenue and non-GAAP operating margin targets. Because both exceeded the maximum levels, each Named Executive Officer received his or her maximum payment, equal to 200% of the target payment. Long-term awards were 40% stock options and 60% performance share awards, with the performance shares tied to non-GAAP operating margin and TSR percentile ranking.
What happens to executives if there is a change in control?
Under the New CIC Agreements effective January 22, 2015, a qualifying termination within three months before to twelve months after a change in control triggers a lump-sum payment of two times the sum of base salary and annual short-term cash incentive, 18 months of stock option exercisability and Company-paid COBRA coverage. Equity awards granted after January 22, 2015 accelerate on a qualifying termination rather than on the change in control alone, unless the successor does not assume them.
Are the directors considered independent?
The Board determined that Kevin L. Beebe, Timothy R. Furey, Balakrishnan S. Iyer, Christine King, David J. McLachlan, David P. McGlade and Robert A. Schriesheim are independent under applicable NASDAQ rules. The Audit Committee consists of Schriesheim (Chairman), Beebe, Iyer and McLachlan, and Schriesheim, Iyer and McLachlan are designated audit committee financial experts.
What was the company's stock ownership and dividend position?
As of January 15, 2015, there were 190,819,868 shares of common stock outstanding. The filing notes that the company declared its first quarterly dividend in April 2014. Directors and executive officers as a group beneficially owned 1,375,167 shares, which is less than 1% of the class.
06—Continue