Actions Semiconductor Reports Fourth Quarter and Fiscal Year 2012 Results
Fourth Quarter Revenue Up 23% Year-Over-Year
ZHUHAI, China, January 24, 2013 -- Actions Semiconductor Co., Ltd. (Nasdaq: ACTS), one of China's leading fabless semiconductor companies that provides comprehensive portable multimedia and mobile internet system-on-a-chip (SoC) solutions for portable consumer electronics, today reported its financial results for the fourth quarter and fiscal year ended December 31, 2012.
All financial results are reported on a U.S. GAAP basis.
Revenue for the fourth quarter of 2012 was $15.2 million, as compared to revenue of $15.8 million for the third quarter of 2012, and $12.3 million for the fourth quarter of 2011.
Revenue for the year ended December 31, 2012 was $54.3 million, compared to $47.5 million for the year ended December 31, 2011.
Net loss attributable to Actions Semiconductor's shareholders for the fourth quarter of 2012 was $1.7 million or $0.02 per American Depositary Shares ("ADS"). Included in net loss for the fourth quarter was $2.5 million relating to an other-than-temporary impairment loss on investments. This compares to net income attributable to Actions Semiconductor's shareholders of $0.66 million or $0.01 per ADS, for the third quarter of 2012, and net loss attributable to Actions Semiconductor's shareholders of $0.1 million or $0.002 per ADS, for the fourth quarter of 2011.
Net loss attributable to Actions Semiconductor’s shareholders for the year ended December 31, 2012 was $2.2 million or $0.03 per ADS. This compares to net income attributable to Actions Semiconductor’s shareholders of $3.0 million or $0.04 per ADS, for the year ended December 31, 2011.
Actions Semiconductor reported gross margin of 32.1% for the fourth quarter of 2012, compared to gross margin of 37.6% for the third quarter of 2012, and 37.6% for the fourth quarter of 2011. The Company ended the fourth quarter with $81.3 million in cash and cash equivalents, together with time deposits. Trading securities and marketable securities, current and non-current, were $142.0 million at the end of the fourth quarter.
Since the share repurchase program commenced in 2007, the Company has invested approximately $45.6 million in repurchasing its shares. As of December 31, 2012, approximately 20.2 million American Depositary Shares (ADSs) were repurchased.
“We are pleased that our 2012 growth initiatives centered on penetrating the tablet market resulted in a 23% increase in revenue for the fourth quarter and a 14% increase in revenue for the full year,” stated Dr. Zhenyu Zhou, CEO of Actions Semiconductor. “By leveraging our core technology strengths in multimedia, we were able to launch two new tablet product families in 2012 and recently announced that new tablets from two brand name customers feature Actions’ OWL series ATM7029 chipset.”
“Heading into 2013, we are enthusiastic about the growth opportunities in the global whitebox tablet market. Improved performance and user experience is driving demand in this market segment. We believe the features for our second tablet product series, OWL, provide unprecedented levels of performance and power efficiency, and position the company for increasing traction in this growing market. While we anticipate normal seasonality in our business in the first quarter, based on the demand we are experiencing and the current market dynamics, we expect the OWL product series to drive revenue growth of at least 25% for the full year 2013,” concluded Dr. Zhou.
Business Outlook
The following statements are based upon management's current expectations. These statements are forward-looking, and actual results may differ materially. The Company undertakes no obligation to update these statements.
For the first quarter of fiscal year 2013 ending March 31, 2013, Actions Semiconductor estimates revenue in the range of $12.0 to $13.0 million and gross margin of approximately 35%.
Conference Call Details
Actions Semiconductor's fourth quarter and fiscal year 2012 teleconference and webcast is scheduled to begin at 5:30 p.m. Eastern Time, on Thursday, January 24, 2013. To participate in the live call, analysts and investors should dial 877-941-4774 (within U.S.) or 480-629-9760 (outside U.S.) at least ten minutes prior to the call. Actions Semiconductor will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the company's website at www.actions-semi.com. An audio replay of the call will be available to investors through February 3, 2013 by dialing 800-406-7325 (within U.S.) or 303-590-3030 (outside U.S.) and entering access code 4590866.
About Actions Semiconductor
Actions Semiconductor is one of China's leading fabless semiconductor companies that provides comprehensive portable multimedia and mobile internet system-on-a-chip (SoC) solutions for portable consumer electronics. Actions Semiconductor products include SoCs, firmware, software, solution development kits, as well as detailed specifications of other required components. Actions Semiconductor also provides total product and technology solutions that allow customers to quickly introduce new portable consumer electronics to the mass market in a cost effective way. The company is headquartered in Zhuhai, China, with offices in Shanghai and Shenzhen. For more information, please visit the Actions Semiconductor website at http://www.actions-semi.com.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995
Statements contained in this release that are not historical facts are forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements concerning signs of positive indicators in the industry for next year, growth in the market driven by continued proliferation of applications within the PMP market and incremental rebound of overall demand for these products, Actions Semiconductor's belief that it is positioned to capture some upside from these trends, and Actions Semiconductor's future expectations with respect to revenue, gross margin, operating expenses and share-based compensation expense. Actions Semiconductor uses words like "believe," "anticipate," "intend," "estimate," "expect," "project" and similar expressions to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements are estimates reflecting current assumptions, expectations and projections about future events and involve significant risks, both known and unknown, uncertainties and other factors that may cause Actions Semiconductor's actual performance, financial condition or results of operations to be materially different from those suggested by the forward-looking statements including, among others, customers' cancellation or modification of their orders; our failure to accurately forecast demand for our products; the loss of, or a significant reduction in orders from, any of our significant customers; fluctuations in our operating results; our inability to develop and sell new products; defects in or failures of our products; the expense and uncertainty involved in our customer design-win efforts; the financial viability of the distributors of our products; consumer demand; worldwide economic and political conditions; fluctuations in our costs to manufacture our products; our reliance on third parties to manufacture, test, assemble and ship our products; our ability to retain and attract key personnel; our ability to compete with our competitors; and our ability to protect our intellectual property rights and not infringe the intellectual property rights of others. Other factors that may cause our actual results to differ from those set forth in the forward-looking statements contained in this press release and that may affect our prospects in general are described in our filings with the Securities and Exchange Commission, including our most recently filed Forms F-1, 20-F and 6-Ks. Other unknown or unpredictable factors also could have material adverse effects on Actions Semiconductor's future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this press release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this press release. Except as required by law, Actions Semiconductor undertakes no obligation and does not intend to update or revise any forward-looking statement to reflect subsequent events or changed assumptions or circumstances.
| Investor Contacts: | |
| Lisa Laukkanen | Edward Chen |
| The Blueshirt Group | Investor Relations at Actions Semiconductor |
| lisa@blueshirtgroup.com | edward@actions-semi.com |
| 415-217-4967 | +86-756-3392353*1110 |
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED CONDENSED BALANCE SHEET
(in thousands of U.S. dollars)
| At December 31, | At September 30, | At December 31, | ||||||||||
| 2012 | 2012 | 2011 | ||||||||||
| (unaudited) | (unaudited) | (audited) | ||||||||||
| ASSETS | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | 71,336 | 40,044 | 33,207 | |||||||||
| Time deposits | 10,000 | - | - | |||||||||
| Marketable securities | 130,721 | 162,244 | 186,890 | |||||||||
| Trading securities | 76 | 75 | 530 | |||||||||
| Accounts receivable, net of allowance for doubtful accounts of nil, $621 and $621 as of December 31, 2012, September 30, 2012 and December 31, 2011 respectively | 5,950 | 2,845 | 2,794 | |||||||||
| Notes receivable | - | 21 | - | |||||||||
| Amount due from a related party | 340 | 158 | 9 | |||||||||
| Amount due from an equity method investee | 79 | 113 | 64 | |||||||||
| Inventories | 11,979 | 11,722 | 7,477 | |||||||||
| Prepaid expenses and other current assets | 4,288 | 4,159 | 1,675 | |||||||||
| Income tax recoverable | 189 | - | - | |||||||||
| Deferred tax assets | 504 | 375 | 430 | |||||||||
| Total current assets | 235,462 | 221,756 | 233,076 | |||||||||
| Investments in equity method investees | 14,329 | 14,409 | 14,246 | |||||||||
| Other investments | 16,305 | 18,833 | 17,334 | |||||||||
| Marketable securities | 11,239 | 11,039 | - | |||||||||
| Rental deposits | 49 | 43 | 49 | |||||||||
| Property, plant and equipment, net | 32,321 | 32,133 | 32,939 | |||||||||
| Land use right | 1,584 | 1,565 | 1,593 | |||||||||
| Acquired intangible assets, net | 10,819 | 8,457 | 9,859 | |||||||||
| Deposit paid for acquisition of intangible assets | - | 1,088 | - | |||||||||
| Deferred tax assets | 80 | 83 | 27 | |||||||||
| TOTAL ASSETS | 322,188 | 309,406 | 309,123 | |||||||||
| LIABILITIES AND EQUITY | ||||||||||||
| Current liabilities: | ||||||||||||
| Accounts payable | 8,073 | 7,953 | 4,374 | |||||||||
| Accrued expenses and other current liabilities | 9,014 | 6,134 | 8,605 | |||||||||
| Short-term bank loans | 20,500 | 12,000 | 12,000 | |||||||||
| Other liabilities | 2,056 | 1,893 | 1,954 | |||||||||
| Income tax payable | 49 | 118 | 238 | |||||||||
| Deferred tax liabilities | 534 | 705 | 295 | |||||||||
| Total current liabilities | 40,226 | 28,803 | 27,466 | |||||||||
| Other liabilities | 13 | 6 | 458 | |||||||||
| Payable for acquisition of intangible assets | - | - | 153 | |||||||||
| Deferred tax liabilities | 3,189 | 3,090 | 2,840 | |||||||||
| Total liabilities | 43,428 | 31,899 | 30,917 | |||||||||
| Equity: | ||||||||||||
| Ordinary shares | 1 | 1 | 1 | |||||||||
| Additional paid-in capital | 20,202 | 20,521 | 20,600 | |||||||||
| Accumulated other comprehensive income | 35,751 | 32,523 | 32,589 | |||||||||
| Retained earnings | 222,835 | 224,490 | 225,037 | |||||||||
| Total Actions Semiconductor Co., Ltd. shareholders' equity | 278,789 | 277,535 | 278,227 | |||||||||
| Non-controlling interest | (29 | ) | (28 | ) | (21 | ) | ||||||
| Total equity | 278,760 | 277,507 | 278,206 | |||||||||
| TOTAL LIABILITIES AND EQUITY | 322,188 | 309,406 | 309,123 | |||||||||
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(in thousands of U.S. dollars, except number of shares and per share amounts)
| Three months ended | Three months ended | Year ended | Year ended | |||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (audited) | |||||||||||||
| Revenues: | ||||||||||||||||
| Third-parties: | ||||||||||||||||
| System-on-a-chip products | 14,314 | 12,036 | 52,356 | 41,385 | ||||||||||||
| Semiconductor product testing services | 28 | 58 | 179 | 317 | ||||||||||||
| 14,342 | 12,094 | 52,535 | 41,702 | |||||||||||||
| Related-parties: | ||||||||||||||||
| System-on-a-chip products | 817 | 199 | 1,794 | 5,783 | ||||||||||||
| Total revenues | 15,159 | 12,293 | 54,329 | 47,485 | ||||||||||||
| Cost of revenues: | ||||||||||||||||
| Third-parties: | ||||||||||||||||
| System-on-a-chip products | (9,697 | ) | (7,513 | ) | (33,814 | ) | (25,454 | ) | ||||||||
| Semiconductor product testing services | (15 | ) | (34 | ) | (100 | ) | (176 | ) | ||||||||
| (9,712 | ) | (7,547 | ) | (33,914 | ) | (25,630 | ) | |||||||||
| Related-parties: | ||||||||||||||||
| System-on-a-chip products | (587 | ) | (127 | ) | (1,193 | ) | (3,367 | ) | ||||||||
| Total cost of revenues | (10,299 | ) | (7,674 | ) | (35,107 | ) | (28,997 | ) | ||||||||
| Gross profit | 4,860 | 4,619 | 19,222 | 18,488 | ||||||||||||
| Other operating income | 136 | 227 | 896 | 1,523 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | (6,195 | ) | (5,984 | ) | (23,739 | ) | (22,086 | ) | ||||||||
| General and administrative | (2,660 | ) | (2,468 | ) | (8,573 | ) | (8,786 | ) | ||||||||
| Selling and marketing | (364 | ) | (307 | ) | (1,281 | ) | (1,195 | ) | ||||||||
| Impairment on goodwill and intangible assets | - | - | (888 | ) | ||||||||||||
| Total operating expenses | (9,219 | ) | (8,759 | ) | (33,593 | ) | (32,955 | ) | ||||||||
| Loss from operations | (4,223 | ) | (3,913 | ) | (13,475 | ) | (12,944 | ) | ||||||||
| Other income | 1,674 | 270 | 1,547 | 4,066 | ||||||||||||
| Dividend income from an other investment | - | 457 | - | 889 | ||||||||||||
| Investment income from an other investment | - | - | - | 268 | ||||||||||||
| Fair value change in financial instruments | - | 1 | 2 | 4 | ||||||||||||
| Gain on disposal of an other investment | - | - | - | 195 | ||||||||||||
| Other-than-temporary impairment loss on investments | (2,543 | ) | - | (2,543 | ) | - | ||||||||||
| Interest income | 3,257 | 3,494 | 13,240 | 12,668 | ||||||||||||
| Interest expense | (63 | ) | (52 | ) | (250 | ) | (144 | ) | ||||||||
| (Loss) income before income taxes, share of net (loss) income of equity method investees and noncontrolling interest | (1,898 | ) | 257 | (1,479 | ) | 5,002 | ||||||||||
| Income tax credit (expense) | 370 | (33 | ) | (772 | ) | (879 | ) | |||||||||
| Equity in net (loss) income of equity method investees | (128 | ) | (337 | ) | 41 | (1,113 | ) | |||||||||
| Net (loss) income | (1,656 | ) | (113 | ) | (2,210 | ) | 3,010 | |||||||||
| Less: Net loss (income) attributable to noncontrolling interest | 1 | 1 | 8 | (5 | ) | |||||||||||
| Net (loss) income attributable to Actions Semiconductor Co.,Ltd. | (1,655 | ) | (112 | ) | (2,202 | ) | 3,005 | |||||||||
| Net (loss) income attributable to Actions Semiconductor Co.,Ltd. | ||||||||||||||||
| Basic (per share) | (0.004 | ) | (0.000 | ) | (0.005 | ) | 0.007 | |||||||||
| Diluted (per share) | (0.004 | ) | (0.000 | ) | (0.005 | ) | 0.007 | |||||||||
| Basic (per ADS) | (0.024 | ) | (0.002 | ) | (0.032 | ) | 0.043 | |||||||||
| Diluted (per ADS) | (0.024 | ) | (0.002 | ) | (0.032 | ) | 0.042 | |||||||||
| Weighted-average shares used in computation: | ||||||||||||||||
| Basic | 410,209,703 | 414,831,816 | 412,706,341 | 418,499,545 | ||||||||||||
| Diluted | 410,209,703 | 414,831,816 | 412,706,341 | 433,983,105 | ||||||||||||
| Weighted-average ADS used in computation: | ||||||||||||||||
| Basic | 68,368,284 | 69,138,636 | 68,784,390 | 69,749,924 | ||||||||||||
| Diluted | 68,368,284 | 69,138,636 | 68,784,390 | 72,330,518 | ||||||||||||
| Note: Share-based compensation recorded in each expense classification above is as follows: | ||||||||||||||||
| Research and development | 229 | 475 | 1,090 | 1,449 | ||||||||||||
| General and administrative | 67 | 139 | 312 | 393 | ||||||||||||
| Selling and marketing | 12 | 19 | 52 | 68 | ||||||||||||
| Cost of revenues | - | 1 | 10 | 18 | ||||||||||||
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars)
| Three months ended | Year ended | Year ended | ||||||||||
| December 31, | December 31, | December 31, | ||||||||||
| 2012 | 2012 | 2011 | ||||||||||
| (unaudited) | (unaudited) | (audited) | ||||||||||
| Operating activities: | ||||||||||||
| Net (loss) income | (1,656 | ) | (2,210 | ) | 3,010 | |||||||
| Adjustments to reconcile net (loss) income to net cash provided by Operating activities: | ||||||||||||
| Depreciation of property, plant and equipment | 548 | 2,290 | 2,109 | |||||||||
| Amortization of land use right | 9 | 36 | 36 | |||||||||
| Amortization of acquired intangible assets | 871 | 3,056 | 1,803 | |||||||||
| Utilization of subsidy from local authorities of Zhuhai, the People's Republic of China ("PRC") | (32 | ) | (674 | ) | (995 | ) | ||||||
| Write down of inventories | - | 180 | 232 | |||||||||
| Loss on disposal of property, plant and equipment | 5 | 5 | 28 | |||||||||
| Loss on disposal of intangible assets | - | - | 4 | |||||||||
| Impairment loss recognised in respect of goodwill | - | - | 468 | |||||||||
| Impairment loss recognised in respect of intangible assets | - | - | 420 | |||||||||
| Impairment loss recognised in respect of other investments | 2,543 | 2,543 | - | |||||||||
| Investment income from an other investment | - | - | (268 | ) | ||||||||
| Gain on disposal of other investment | - | - | (195 | ) | ||||||||
| Share of net loss (income) of equity method investees | 128 | (40 | ) | 1,113 | ||||||||
| Share-based compensation | 308 | 1,465 | 1,928 | |||||||||
| Fair value change in financial instruments | - | (2 | ) | (4 | ) | |||||||
| Deferred taxes | (205 | ) | 454 | 428 | ||||||||
| Proceeds from disposal of financial instruments | - | 459 | - | |||||||||
| Changes in operating assets and liabilities: | ||||||||||||
| Accounts receivable | (3,098 | ) | (3,150 | ) | (947 | ) | ||||||
| Notes receivable | 21 | - | - | |||||||||
| Amount due from a related party | (182 | ) | (331 | ) | 550 | |||||||
| Inventories | (77 | ) | (4,510 | ) | (2,632 | ) | ||||||
| Amount due from an equity method investee | 35 | (14 | ) | 47 | ||||||||
| Prepaid expenses and other current assets | (56 | ) | (2,549 | ) | 1,736 | |||||||
| Accounts payable | 11 | 3,598 | 1,310 | |||||||||
| Accrued expenses and other current liabilities | 3,871 | 1,232 | (3,002 | ) | ||||||||
| Income tax recoverable | (189 | ) | (189 | ) | - | |||||||
| Income tax payable | (70 | ) | (190 | ) | 94 | |||||||
| Rental deposit (paid) received | (5 | ) | 4 | (8 | ) | |||||||
| Net cash provided by operating activities | 2,780 | 1,463 | 7,265 | |||||||||
| Investing activities: | ||||||||||||
| Increase in an equity method investees | - | (1,500 | ) | (9,676 | ) | |||||||
| Investment income from an other investment | - | - | 268 | |||||||||
| Purchase of other investments | - | - | (13,727 | ) | ||||||||
| Proceeds from redemption of marketable securities | 32,995 | 178,975 | 278,568 | |||||||||
| Purchase of marketable securities | - | (132,376 | ) | (272,240 | ) | |||||||
| Proceeds from disposal of property, plant and equipment | - | 22 | 34 | |||||||||
| Proceeds from the disposal of other investments | - | - | 195 | |||||||||
| Purchase of property, plant and equipment | (168 | ) | (1,147 | ) | (7,472 | ) | ||||||
| Purchase of intangible assets | (3,086 | ) | (3,867 | ) | (2,642 | ) | ||||||
| Deposit paid for acquisition of property, plant and equipment | - | (1,088 | ) | - | ||||||||
| (Increase) decrease in time deposits | (10,000 | ) | (10,000 | ) | 34 | |||||||
| Net cash from (used in) investing activities | 19,741 | 29,019 | (26,658 | ) | ||||||||
| Financing activities: | ||||||||||||
| Proceeds from short-term bank loans | 8,500 | 8,500 | 12,000 | |||||||||
| Advance subsidy from local authorities of Zhuhai, the PRC | 167 | 299 | 711 | |||||||||
| Proceeds from exercise of stock option | 210 | 2,290 | 671 | |||||||||
| Repurchase of ordinary shares | (836 | ) | (4,151 | ) | (6,251 | ) | ||||||
| Net cash from financing activities | 8,041 | 6,938 | 7,131 | |||||||||
| Net increase (decrease) in cash and cash equivalents | 30,562 | 37,420 | (12,262 | ) | ||||||||
| Cash and cash equivalents at the beginning of the period | 40,044 | 33,207 | 42,872 | |||||||||
| Effect of exchange rate changes on cash | 730 | 709 | 2,597 | |||||||||
| Cash and cash equivalents at the end of the period | 71,336 | 71,336 | 33,207 | |||||||||