Operational and Strategic Highlights:
- O2Micro reports non-GAAP net loss per fully diluted ADS of
$0.06 and GAAP net loss per fully diluted ADS of $0.08.
- Company experienced strong design activity in solutions for
backlighting, general lighting, battery, smartphone and tablet
markets; expecting products to continue to ramp in the second half
of 2016.
- Revenue from battery management products now anticipated to
reach 20-25% of projected 2016 revenue in the second half of this
year, expected to become second largest product line in 2016.
- Expects revenue to be up approximately 4-12 percent
sequentially in the third 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 second quarter of 2016, ending June 30, 2016.
Financial Highlights for the Second Quarter ending June
30, 2016:
O2Micro International Limited reported Q2 2016 revenue of $13.2
million. Revenue was up 1.8% sequentially and down 10.0% from the
comparable year-ago quarter. The gross margin in the second quarter
of 2016 was 50.7%. The gross margin was up from 48.8% in the prior
quarter and up from 49.6% in the second quarter of 2015. The gross
margin remains in our target range and varies primarily with
revenue level and product mix. During the second quarter of 2016,
the company recorded total GAAP operating expenses of $8.8 million,
compared to $8.6 million in the first quarter of 2016 and $10.2
million in the year-ago Q2 period. The respective GAAP operating
margins for the second quarter of 2016, the first quarter of 2016,
and second quarter of 2015 were (15.8%), (17.6%), and (19.6%).
GAAP net loss was $2.0 million in Q2 2016. This compares to a
GAAP net loss of $2.4 million in the first quarter of 2016 and a
GAAP net loss of $2.7 million in Q2 2015. GAAP net loss per fully
diluted ADS was $0.08 in Q2 2016. This compares to a GAAP net loss
per fully diluted ADS of $0.09 in Q1 2016 and a GAAP net loss per
fully diluted ADS of $0.10 in Q2 2015.
Financial Highlights for the Six Months ending June 30,
2016:
O2Micro International Limited reported revenue of $26.2 million
for the six months ending June 30, 2016. This was down 5.7% from
$27.8 million in the comparable six months of 2015. The gross
margins were 49.8% and 49.8% during the corresponding periods of
2016 and 2015, respectively. GAAP operating expenses were $17.4
million and $20.3 million in the first half of 2016 and 2015,
respectively. The respective GAAP operating margins for the
comparable periods were (16.7%) and (23.2%). Pretax loss from
operations was $3.9 million in the first half of 2016. This
compares to a pretax loss from operations of $5.4 million in the
first half of 2015. GAAP net loss was $4.3 million in 1H 2016. This
compares to a GAAP net loss of $5.9 million in 1H 2015. The GAAP
net loss per fully diluted ADS was $0.17 in the first six months of
2016. This compares to a GAAP net loss per fully diluted ADS of
$0.23 in the corresponding first half of 2015.
Supplementary Data:
The company ended the second quarter of 2016 with $47.5 million
in unrestricted cash and short-term investments or $1.85 per
outstanding ADS. The accounts receivable balance was $6.9 million
and represented 42 days sales outstanding at the end of Q2 2016.
Inventory was $9.2 million or 128 days and turned over 2.8 times
during Q2 2016. As of June 30, 2016, the company had $59.7 million
in working capital and the book value was $80.3 million, or $3.13
per outstanding ADS.
As of June 30, 2016, O2Micro International Limited counted 360
employees, including 209 engineers.
Management Commentary:
“Second quarter 2016 financial results were within the range of
the guidance that we provided in May as we continue to grow revenue
and execute on our business objectives,” said Sterling Du,
O2Micro’s Chairman and CEO. “Our third quarter revenue guidance
reflects ongoing product ramps in our high potential growth drivers
for the consumer and industrial end markets including backlighting
for the TV market, power tools, household appliances, LED lighting
and smartphones and tablets. We believe our solutions for
these product segments will contribute to top-line growth in
upcoming quarters and lead O2Micro back to profitability in the
near future.”
Conference Call: O2Micro will hold its
second quarter conference call today, August 3, 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 August
10th by visiting the following URL and providing the following
conference code:
https://jsp.premiereglobal.com/webrsvp Conference code:
3244390.
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 33,705 patent claims granted, and over
30,000 more pending. 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 O2Micro’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 |
Six Months Ended |
|
June
30, |
June
30, |
|
2016 |
2015 |
2016 |
2015 |
|
|
|
NET SALES |
$ |
13,222 |
|
$ |
14,690 |
|
$ |
26,207 |
|
$ |
27,791 |
|
|
|
|
|
|
COST OF SALES |
|
6,521 |
|
|
7,407 |
|
|
13,168 |
|
|
13,953 |
|
|
|
|
|
|
GROSS PROFIT |
|
6,701 |
|
|
7,283 |
|
|
13,039 |
|
|
13,838 |
|
|
|
|
|
|
OPERATING EXPENSES |
|
|
|
|
Research and development
(1) |
|
3,775 |
|
|
3,837 |
|
|
7,567 |
|
|
8,297 |
|
Selling, general and
administrative (1) |
|
5,020 |
|
|
6,320 |
|
|
9,874 |
|
|
11,991 |
|
Litigation income |
|
- |
|
|
- |
|
|
(23 |
) |
|
- |
|
|
|
|
|
|
Total Operating
Expenses |
|
8,795 |
|
|
10,157 |
|
|
17,418 |
|
|
20,288 |
|
|
|
|
|
|
LOSS FROM
OPERATIONS |
|
(2,094 |
) |
|
(2,874 |
) |
|
(4,379 |
) |
|
(6,450 |
) |
|
|
|
|
|
NON-OPERATING
INCOME |
|
|
|
|
Interest income |
|
76 |
|
|
199 |
|
|
153 |
|
|
436 |
|
Foreign exchange loss –
net |
|
(303 |
) |
|
(152 |
) |
|
(507 |
) |
|
(143 |
) |
Gain on sale of real
estate |
|
- |
|
|
201 |
|
|
- |
|
|
499 |
|
Gain on sale of
long-term investments |
|
413 |
|
|
- |
|
|
425 |
|
|
- |
|
Other – net |
|
179 |
|
|
176 |
|
|
416 |
|
|
250 |
|
Total Non-operating
Income |
|
365 |
|
|
424 |
|
|
487 |
|
|
1,042 |
|
|
|
|
|
|
LOSS BEFORE INCOME
TAX |
|
(1,729 |
) |
|
(2,450 |
) |
|
(3,892 |
) |
|
(5,408 |
) |
|
|
|
|
|
INCOME TAX EXPENSE |
|
237 |
|
|
287 |
|
|
438 |
|
|
528 |
|
|
|
|
|
|
NET LOSS |
|
(1,966 |
) |
|
(2,737 |
) |
|
(4,330 |
) |
|
(5,936 |
) |
|
|
|
|
|
OTHER COMPREHENSIVE
INCOME |
|
|
|
|
Foreign currency
translation adjustments |
|
139 |
|
|
474 |
|
|
573 |
|
|
427 |
|
Unrealized gain on
available-for-sale securities |
|
531 |
|
|
- |
|
|
531 |
|
|
- |
|
Unrealized pension
gain |
|
- |
|
|
1 |
|
|
- |
|
|
3 |
|
Total Other
Comprehensive Gain |
|
670 |
|
|
475 |
|
|
1,104 |
|
|
430 |
|
|
|
|
|
|
COMPREHENSIVE LOSS |
$ |
(1,296 |
) |
$ |
(2,262 |
) |
$ |
(3,226 |
) |
$ |
(5,506 |
) |
|
|
|
|
|
BASIC AND DILUTED LOSS
PER ADS |
$ |
(0.08 |
) |
$ |
(0.10 |
) |
$ |
(0.17 |
) |
$ |
(0.23 |
) |
|
|
|
|
|
ADS UNITS USED IN LOSS
PER ADS CALCULATION: |
|
|
|
|
Basic (in
thousands) |
|
25,673 |
|
|
26,113 |
|
|
25,686 |
|
|
26,297 |
|
Diluted (in
thousands) |
|
25,673 |
|
|
26,113 |
|
|
25,686 |
|
|
26,297 |
|
|
|
|
|
|
(1) INCLUDES
STOCK-BASED COMPENSATION CHARGE AS FOLLOWS: |
|
|
|
|
Research and
development |
$ |
60 |
|
$ |
76 |
|
$ |
125 |
|
$ |
170 |
|
Selling, general and
administrative |
$ |
360 |
|
$ |
371 |
|
$ |
733 |
|
$ |
828 |
|
|
O2MICRO
INTERNATIONAL LIMITED AND SUBSIDIARIES |
|
CONSOLIDATED
BALANCE SHEETS |
(In Thousand U.S.
Dollars, Except Share Amounts) |
|
|
June 30, |
December 31, |
|
2016 |
2015 |
ASSETS |
(Unaudited) |
(Audited) |
|
|
|
CURRENT ASSETS |
|
|
Cash and cash
equivalents |
$ |
37,475 |
|
$ |
41,199 |
|
Restricted cash |
|
32 |
|
|
31 |
|
Short-term
investments |
|
10,028 |
|
|
11,233 |
|
Accounts receivable –
net |
|
6,880 |
|
|
5,197 |
|
Inventories |
|
9,216 |
|
|
9,662 |
|
Prepaid expenses and other
current assets |
|
1,464 |
|
|
1,126 |
|
Assets held for sale |
|
1,956 |
|
|
1,956 |
|
Total Current Assets |
|
67,051 |
|
|
70,404 |
|
|
|
|
LONG-TERM INVESTMENTS |
|
4,861 |
|
|
9,304 |
|
|
|
|
PROPERTY AND EQUIPMENT –
NET |
|
13,904 |
|
|
14,011 |
|
|
|
|
OTHER ASSETS |
|
2,231 |
|
|
2,489 |
|
|
|
|
TOTAL ASSETS |
$ |
88,047 |
|
$ |
96,208 |
|
|
|
|
LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
|
|
CURRENT LIABILITIES |
|
|
Notes and accounts
payable |
$ |
2,746 |
|
$ |
3,333 |
|
Income tax payable |
|
334 |
|
|
2,245 |
|
Deferred tax
liabilities |
|
1,030 |
|
|
2,206 |
|
Accrued expenses and other
current liabilities |
|
3,244 |
|
|
4,896 |
|
Total Current
Liabilities |
|
7,354 |
|
|
12,680 |
|
|
|
|
OTHER LONG-TERM
LIABILITIES |
|
|
Accrued pension
liabilities |
|
272 |
|
|
272 |
|
Other liabilities |
|
122 |
|
|
139 |
|
Total Other Long-Term
Liabilities |
|
394 |
|
|
411 |
|
|
|
|
Total Liabilities |
|
7,748 |
|
|
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 June 30, 2016
and December 31, 2015,respectivelyOutstanding –1,281,661,250
and 1,278,661,400 shares as of June 30, 2016 and December 31,
2015, respectively |
|
33 |
|
|
33 |
|
Additional paid-in
capital |
|
142,038 |
|
|
141,886 |
|
Accumulated deficits |
|
(42,716 |
) |
|
(38,386 |
) |
Accumulated other
comprehensive income |
|
5,928 |
|
|
4,824 |
|
Treasury stock –
387,375,350 and 382,125,200 shares as of June 30, 2016 and December
31, 2015, respectively |
|
(24,984 |
) |
|
(25,240 |
) |
Total Shareholders’
Equity |
|
80,299 |
|
|
83,117 |
|
|
|
|
TOTAL LIABILITIES AND
SHAREHOLDERS’ EQUITY |
$ |
88,047 |
|
$ |
96,208 |
|
|
Contact Information:
Scott L. Anderson
Director of Investor Relations, O2Micro
Phone: 408.987.5920, x8888
Email: scott.anderson@o2micro.com
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