Operational and Strategic
Highlights:
- O2Micro reports non-GAAP net income per fully diluted ADS of
0.07 and GAAP net income per fully diluted ADS of $0.05
- Company experienced strong design activity in solutions for
backlighting, general lighting, battery, smartphone and tablet
markets; expecting products to continue to ramp in the fourth
quarter of 2016.
- Expects revenue to be up approximately 2-8 percent sequentially
in the fourth quarter of fiscal year 2016.
O2Micro® International Limited (NASDAQ:OIIM), a global leader in
the design, development and marketing of high-performance
integrated circuits and solutions, reported its financial results
today for the third quarter of 2016, ending September 30, 2016.
Financial Highlights for the Third Quarter ending
September 30, 2016:
O2Micro International Limited reported Q3 2016 revenue of $14.4
million with revenues up 9.2% from the prior quarter. The gross
margin in the third quarter of 2016 was 52.6% and is up from 50.7%
in the prior quarter. The gross margin exceeds our target range and
varies primarily with revenue level and product mix. During the
third quarter of 2016, the company recorded total GAAP operating
expenses of $8.7 million, compared to $8.8 million in prior
quarter. The respective GAAP operating margins for the third
quarter of 2016 and the second quarter of 2016 were (7.6%) and
(15.8%).
GAAP net income was $1.3 million in Q3 2016. This compares to a
GAAP net loss of $2.0 million in the second quarter of 2016. GAAP
net income per fully diluted ADS was $0.05 in Q3 2016. This
compares to a GAAP net loss per fully diluted ADS of $0.08 in Q2
2016.
Supplementary Data:
The company ended the third quarter of 2016 with $53.1 million
in unrestricted cash and short-term investments or $2.07 per
outstanding ADS. The accounts receivable balance was $6.6 million
and represented 42 days sales outstanding at the end of Q3 2016.
Inventory was $8.5 million or 116 days and turned over 3.1 times
during Q3 2016. As of September 30, 2016, the company had $61.5
million in working capital and the book value was $81.3 million, or
$3.18 per outstanding ADS.
As of September 30, 2016, O2Micro International Limited counted
365 employees, including 206 engineers.
Management Commentary:
“Third quarter 2016 financial results were within the range of
the guidance that we provided in August as we continue to grow
revenue and execute on our business objectives,” said Sterling Du,
O2Micro’s Chairman and CEO. “Our fourth quarter revenue guidance
reflects ongoing product ramps in our high potential growth drivers
for the consumer and industrial end markets which include
backlighting for the TV market, power tools, household appliances,
LED lighting and smartphones and tablets. We believe our solutions
for these product segments will continue to contribute to our
top-line growth in upcoming quarters and lead O2Micro back to long
term profitability.”
Conference Call: O2Micro will hold its third
quarter conference call today, November 2, 2016, at 6:00 a.m. PDT,
9:00 a.m. EDT. You may participate using the following dial-in
information.
| In the US and CANADA: |
800-723-6498, pass code #4887486 |
| INTERNATIONAL participants:
|
785-830-7989, pass code #4887486 |
A replay of the call will be available by phone until November
9th by visiting the following URL:
https://event.mymeetingroom.com/Public/WebRegistration/Y29uZmVyZW5jZUlkPTc5MTkwNTAmdHlwZT1yZXBsYXkmbGFuZ3VhZ2U9ZW5nbGlzaA==passcode:
2927880
A live webcast will also be available on the company website at
www.o2micro.com, and an online replay will be available for one
week.
About O2Micro
Founded in April 1995, O2Micro develops and markets innovative
power management components for the Computer, Consumer, Industrial,
Automotive and Communications markets. Products include LED General
Lighting, Backlighting, Battery Management and Power
Management.
O2Micro International maintains an extensive portfolio of
intellectual property with 33,938 patent claims granted. The
company maintains offices worldwide. Additional company and product
information can be found on the company website at
www.o2micro.com.
O2Micro, the O2Micro logo, and combinations thereof are
registered trademarks of O2Micro. All other trademarks or
registered trademarks are the property of their respective
owners.
Statements made in this release that are not historical,
including statements regarding O2Micro or its management's
intentions, hopes, beliefs, expectations, representations,
projections, plans or predictions of the future, are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 and other Federal
Securities Laws. Such statements involve risks, speculation and
uncertainties that may cause actual results to differ materially
from those set forth in these statements or from management’s
current views and expectations. Risks and uncertainties in this
release may include, without limitation, any one or combination of
the following: the effect of competitive and economic
factors; real property value fluctuations and market demand; legal
changes in any relevant rules and regulations pertaining to
O2Micro’s business; changes in technology and industry standards,
and O2Micro’s reaction to those factors; consumer and business
buying decisions with respect to our customers’ products
incorporating O2Micro’s products; continued competitive pressures
in the marketplace; the ability of O2Micro to deliver to the
marketplace, and stimulate customer demand therein, for new
products and technological innovations on a timely basis; the
effect that product introductions and transitions, changes in
product pricing or mix, and/or increases in component costs could
have on O2Micro’s gross margins; the inventory risk associated with
O2Micro’s need to order, or commit to order, product components and
product capacity in advance of forecast customer orders; the
continued availability of acceptable terms of certain components
and services essential to O2Micro’s business which are currently
obtained by the company from sole or limited sources; the effect
that O2Micro’s dependency on manufacturing and logistics services
provided by third parties may have on the quality, quantity,
availability or cost of products manufactured or services rendered;
risks associated with O2Mcro’s international operations; the
potential impact of a finding that O2Micro has infringed on the
intellectual property rights of others, or that any third party may
have infringed on O2Micro’s intellectual property that may
negatively affect O2Micro’s business; O2Micro’s legal
classifications with governmental and regulatory agencies;
O2Micro’s dependency on the performance of distributors, carriers,
independent sales representatives, and other resellers of O2Micro’s
products; the effect that product and service quality problems
could have on O2Micro’s sales ability and operating profits; the
ability of O2Micro to deliver its products in a timely fashion to
its customers, and the possible negative ramifications if such is
not possible; the continued service and availability of key
executives and employees; war, terrorism, public health issues,
natural disasters, and other circumstances that could disrupt
supply, delivery, or demand of products; and unfavorable results of
other legal proceedings.
Actual results may differ materially due to numerous risk
factors. Such risk factors are more fully enumerated in O2Micro’s
20-F Annual Filings, Annual Report(s), 6-K’s, the Form F-1 filed in
connection with the company’s initial public offering in August
2000, information posted on our website at www.o2micro.com, and
other documents filed with the SEC, NASDAQ or any other public
agency from time to time. The statements herein are based on dated
information on the dates mentioned herein, which is subject to
change. O2Micro assumes no obligation to update or revise the
information provided on today, or any other forward-looking
information, whether as a result of new information, future events
or any other information that may arise. This information only
speaks to the respective dates mentioned in said information.
| |
| O2MICRO
INTERNATIONAL LIMITED AND SUBSIDIARIES |
| |
| CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(UNAUDITED) |
| (In Thousand
U.S. Dollars, Except Per Share Amounts) |
| |
|
|
| |
Three Months
Ended |
Nine Months
Ended |
| |
September 30, |
September 30, |
| |
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
| |
|
|
| NET SALES |
$ |
14,445 |
|
$ |
13,671 |
|
$ |
40,652 |
|
$ |
41,462 |
|
| |
|
|
|
|
| COST OF SALES |
|
6,847 |
|
|
6,556 |
|
|
20,015 |
|
|
20,509 |
|
| |
|
|
|
|
| GROSS PROFIT |
|
7,598 |
|
|
7,115 |
|
|
20,637 |
|
|
20,953 |
|
| |
|
|
|
|
| OPERATING EXPENSES
(INCOME) |
|
|
|
|
| Research and development (1) |
|
3,960 |
|
|
4,709 |
|
|
11,527 |
|
|
13,006 |
|
| Selling, general and administrative
(1) |
|
4,741 |
|
|
5,827 |
|
|
14,615 |
|
|
17,818 |
|
| Litigation income |
|
- |
|
|
- |
|
|
(23 |
) |
|
- |
|
| Total Operating Expenses |
|
8,701 |
|
|
10,536 |
|
|
26,119 |
|
|
30,824 |
|
| |
|
|
|
|
| LOSS FROM
OPERATIONS |
|
(1,103 |
) |
|
(3,421 |
) |
|
(5,482 |
) |
|
(9,871 |
) |
| |
|
|
|
|
| NON-OPERATING
INCOME |
|
|
|
|
| Interest income |
|
71 |
|
|
139 |
|
|
224 |
|
|
575 |
|
| Foreign exchange gain (loss) –
net |
|
203 |
|
|
834 |
|
|
(304 |
) |
|
691 |
|
| Gain on sale of real estate |
|
1,725 |
|
|
268 |
|
|
1,725 |
|
|
767 |
|
| Gain on sale of long-term
investments |
|
523 |
|
|
8 |
|
|
936 |
|
|
8 |
|
| Other – net |
|
195 |
|
|
97 |
|
|
623 |
|
|
347 |
|
| Total Non-operating Income |
|
2,717 |
|
|
1,346 |
|
|
3,204 |
|
|
2,388 |
|
| |
|
|
|
|
| INCOME (LOSS) BEFORE
INCOME TAX |
|
1,614 |
|
|
(2,075 |
) |
|
(2,278 |
) |
|
(7,483 |
) |
| |
|
|
|
|
| INCOME TAX EXPENSE |
|
282 |
|
|
287 |
|
|
720 |
|
|
815 |
|
| |
|
|
|
|
| NET INCOME (LOSS) |
|
1,332 |
|
|
(2,362 |
) |
|
(2,998 |
) |
|
(8,298 |
) |
| |
|
|
|
|
| OTHER COMPREHENSIVE
INCOME |
|
|
|
|
| Foreign currency translation
adjustments |
|
(65 |
) |
|
(2,180 |
) |
|
508 |
|
|
(1,753 |
) |
| Unrealized gain (loss) on
available-for-sale securities |
|
(530 |
) |
|
- |
|
|
1 |
|
|
- |
|
| Unrealized pension gain |
|
1 |
|
|
2 |
|
|
1 |
|
|
5 |
|
| Total Other Comprehensive Income
(Loss) |
|
(594 |
) |
|
(2,178 |
) |
|
510 |
|
|
(1,748 |
) |
| |
|
|
|
|
| COMPREHENSIVE INCOME
(LOSS) |
$ |
738 |
|
$ |
(4,540 |
) |
$ |
(2,488 |
) |
$ |
(10,046 |
) |
| |
|
|
|
|
| EARNINGS (LOSS) PER
ADS |
|
|
|
|
| Basic |
$ |
0.05 |
|
$ |
(0.09 |
) |
$ |
(0.12 |
) |
$ |
(0.32 |
) |
| Diluted |
$ |
0.05 |
|
$ |
(0.09 |
) |
$ |
(0.12 |
) |
$ |
(0.32 |
) |
| |
|
|
|
|
| ADS UNITS USED IN
EARNINGS (LOSS) PER ADS CALCULATION: |
|
|
|
|
| Basic (in thousands) |
|
25,608 |
|
|
25,896 |
|
|
25,660 |
|
|
26,163 |
|
| Diluted (in thousands) |
|
25,880 |
|
|
25,896 |
|
|
25,660 |
|
|
26,163 |
|
| |
|
|
|
|
| (1) INCLUDES
STOCK-BASED COMPENSATION CHARGE AS FOLLOWS: |
|
|
|
|
| Research and development |
$ |
54 |
|
$ |
76 |
|
$ |
179 |
|
$ |
246 |
|
| Selling, general and
administrative |
$ |
322 |
|
$ |
374 |
|
$ |
1,055 |
|
$ |
1,202 |
|
| O2MICRO
INTERNATIONAL LIMITED AND SUBSIDIARIES |
| |
| CONSOLIDATED
BALANCE SHEETS |
| (In Thousand U.S.
Dollars, Except Share Amounts) |
| |
| |
|
|
| |
September 30, |
December 31, |
| |
|
2016 |
|
|
2015
|
|
|
ASSETS |
(Unaudited) |
(Audited) |
| |
|
|
| CURRENT ASSETS |
|
|
| Cash and cash equivalents |
$ |
27,426 |
|
$ |
41,199 |
|
| Restricted cash |
|
32 |
|
|
31 |
|
| Short-term investments |
|
25,642 |
|
|
11,233 |
|
| Accounts receivable – net |
|
6,597 |
|
|
5,197 |
|
| Inventories |
|
8,502 |
|
|
9,662 |
|
| Prepaid expenses and other current
assets |
|
1,393 |
|
|
1,126 |
|
| Assets held for sale |
|
- |
|
|
1,956 |
|
| Total Current Assets |
|
69,592 |
|
|
70,404 |
|
| |
|
|
| LONG-TERM INVESTMENTS |
|
4,253 |
|
|
9,304 |
|
| |
|
|
| PROPERTY AND EQUIPMENT –
NET |
|
13,841 |
|
|
14,011 |
|
| |
|
|
| OTHER ASSETS |
|
2,108 |
|
|
2,489 |
|
| |
|
|
| TOTAL ASSETS |
$ |
89,794 |
|
$ |
96,208 |
|
| |
|
|
| LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
| |
|
|
| CURRENT LIABILITIES |
|
|
| Notes and accounts payable |
$ |
3,771 |
|
$ |
3,333 |
|
| Income tax payable |
|
266 |
|
|
2,245 |
|
| Deferred tax liabilities |
|
921 |
|
|
2,206 |
|
| Accrued expenses and other current
liabilities |
|
3,131 |
|
|
4,896 |
|
| Total Current Liabilities |
|
8,089 |
|
|
12,680 |
|
| |
|
|
| OTHER LONG-TERM
LIABILITIES |
|
|
| Accrued pension liabilities |
|
277 |
|
|
272 |
|
| Other liabilities |
|
84 |
|
|
139 |
|
| Total Other Long-Term
Liabilities |
|
361 |
|
|
411 |
|
| |
|
|
| Total Liabilities |
|
8,450 |
|
|
13,091 |
|
| |
|
|
| COMMITMENTS AND
CONTINGENCIES |
|
|
| |
|
|
| SHAREHOLDERS’ EQUITY |
|
|
| Preference shares at $0.00002 par
value per share |
|
|
| Authorized – 250,000,000
shares |
|
- |
|
|
- |
|
| Ordinary shares at $0.00002 par
value per share |
|
|
| Authorized – 4,750,000,000
shares |
|
|
| Issued – 1,669,036,600 and
1,660,786,600 shares as of September 30, 2016 and December 31,
2015,respectively |
|
|
|
|
|
|
| Outstanding –1,279,624,350 and
1,278,661,400 shares as of September 30, 2016 and December 31,
2015, respectively |
|
33 |
|
|
33 |
|
| Additional paid-in capital |
|
142,388 |
|
|
141,886 |
|
| Accumulated deficits |
|
(41,384 |
) |
|
(38,386 |
) |
| Accumulated other comprehensive
income |
|
5,334 |
|
|
4,824 |
|
| Treasury stock – 389,412,250 and
382,125,200 shares as of September 30, 2016 and December 31, 2015,
respectively |
|
(25,027 |
) |
|
(25,240 |
) |
| Total Shareholders’ Equity |
|
81,344 |
|
|
83,117 |
|
| |
|
|
| TOTAL LIABILITIES AND
SHAREHOLDERS’ EQUITY |
$ |
89,794 |
|
$ |
96,208 |
|
Contact Information:
Investor Relations, O2Micro
Phone: 408.987.5920, x8888
Email: ir@o2micro.com
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