SANTA CLARA, Calif.,
Feb. 26, 2015 /PRNewswire/ -- OmniVision Technologies,
Inc. (Nasdaq: OVTI), a leading developer of advanced digital
imaging solutions, today reported financial results for the third
quarter of fiscal 2015 that ended on January 31, 2015.
Revenues for the third quarter of fiscal 2015 were
$292.3 million, as compared to
$394.0 million in the second
quarter of fiscal 2015, and $352.0 million in the third quarter of
fiscal 2014. GAAP net income in the third quarter of
fiscal 2015 was $14.0 million, or $0.23 per diluted share, as compared to net
income of $28.0 million, or
$0.47 per diluted share in the
second quarter of fiscal 2015, and $30.6 million, or $0.54 per diluted share in the third quarter
of fiscal 2014. For the third quarter of fiscal 2015, the
Company recorded approximately $6.5 million of tax benefits, composed of
$3.6 million from the one-year
retroactive extension of the U.S. Federal research and development
tax credit when the Tax Increase Prevention Act was signed into law
on December 19, 2014, and $2.9 million from the conclusion of a
foreign jurisdiction tax examination.
Non-GAAP net income in the third quarter of fiscal 2015 was
$23.3 million, or $0.38 per diluted share. Non-GAAP net income
in the second quarter of fiscal 2015 was $36.9 million, or $0.60 per diluted share. Non-GAAP net income
in the third quarter of fiscal 2014 was $40.4 million, or $0.69 per diluted share. Non-GAAP net income
excludes stock-based compensation expenses and the related tax
effects. Please refer to the attached schedule for a reconciliation
of GAAP net income to non-GAAP net income for the three and nine
months ended January 31, 2015 and 2014 and for the three
months ended October 31, 2014.
GAAP gross margin for the third quarter of fiscal 2015 was
22.1%, as compared to 22.0% for the second quarter of
fiscal 2015 and 19.6% for the third quarter of
fiscal 2014. The sequential increase in third quarter gross
margin reflected improvements in production costs, partially offset
by selling price erosions and a decrease in revenues recorded on
the sale of previously written-down inventory.
The Company ended the period with cash, cash equivalents and
short-term investments totaling $512.8 million, a sequential decrease of
$12.4 million that resulted
primarily from the use of cash in operating activities in the third
quarter of fiscal 2015.
"As we continue to expand in Asia and find new opportunities in emerging
economies, our results may continue to be volatile, at least in the
near-term," said Shaw Hong, chief executive officer of OmniVision
Technologies, Inc. "However, it is important for us to participate
in these markets as they are integral to our strategy. We remain
confident about our long-term growth prospects."
Outlook
Based on current trends, the Company expects revenues for the
fourth quarter of fiscal 2015 will be in the range of
$265 million to $295 million and GAAP net income per
share will be between $0.02 and
$0.18 per diluted share.
Excluding the estimated expense and related tax effects associated
with stock-based compensation, the Company expects its non-GAAP net
income per share will be between $0.15 and $0.31 per diluted share. Refer to the table
below for a reconciliation of GAAP to non-GAAP net income.
Conference Call
OmniVision Technologies, Inc. will host a conference call today
at 5:00 p.m. Eastern time to discuss these results further.
This conference call can be accessed via a webcast at www.ovt.com.
The call can also be accessed by dialing
866-578-5771 (domestic) or 617-213-8055 (international)
and entering passcode 75063105.
A replay of the call will remain available at
www.ovt.com for approximately twelve months. A replay of the
call will also be available for one week beginning approximately
one hour after the conclusion of the call. To access the replay,
dial 888-286-8010 (domestic) or
617-801-6888 (international) and enter
passcode 16223598.
About OmniVision
OmniVision Technologies, Inc. is a leading developer of advanced
digital imaging solutions. Its CameraChip™ and CameraCubeChip™
products are highly integrated, single-chip CMOS image sensors for
consumer and commercial applications, including mobile phones,
tablets and entertainment devices, notebooks and webcams, security
and surveillance systems, digital still and video cameras,
automotive and medical imaging systems. Additional information is
available at www.ovt.com.
Safe Harbor Statement
Certain statements in this press release, including statements
regarding the volatility of our operating results, our long-term
growth prospects, and statements regarding our expectations
regarding revenues and earnings per share for the three months
ending April 30, 2015 are forward-looking statements. These
forward-looking statements are based on management's current
expectations, and certain factors could cause actual results to
differ materially from those in the forward-looking statements.
These factors include, without limitation, our ability to maintain
or increase sales to current key and new customers and end-users of
our products; competition in current and emerging markets for image
sensor products, including pricing pressures that could result from
competition; our ability to increase the average selling prices or
lower the costs associated with the development and manufacture of
our new, complex products and technologies; the potential for a
slowdown in sales in the near term due to an inventory build by our
customers in the earlier part of the year; fluctuations of wafer
manufacturing costs, manufacturing yields, manufacturing capacity
and other manufacturing processes and the impact on gross margins;
the continued growth and development of current markets and the
emergence of new markets in which we sell, or may sell, our
products; fluctuations in sales mix and average selling prices; our
ability to timely complete the product development cycle for new
sensors; our ability to obtain design wins from various image
sensor device manufacturers including manufacturers of mobile
phones, tablets and entertainment devices, notebooks and webcams,
security and surveillance systems, digital still and video cameras,
automotive and medical imaging systems; our dependence on third
party wafer foundries and their ability to manufacture our wafers
in the required quantities, at acceptable quality, yields and
costs, and in a timely manner; our ability to accurately forecast
customer demand for our products; the impact of general economic
conditions on orders from the end-user customers of our products;
the market acceptance of products into which our products are
designed; the development, production, introduction and marketing
of new products and technology; the occurrence of litigation
regarding intellectual property or indemnification claims from our
suppliers or customers relating to our intellectual property; our
strategic investments and relationships, and other risks detailed
from time to time in our Securities and Exchange Commission filings
and reports, including, but not limited to, our most recent Annual
Report on Form 10-K and recent Quarterly Reports on
Form 10-Q. We expressly disclaim any obligation to update
information contained in any forward-looking statement.
Use of Non-GAAP Financial Information
To supplement the reader's overall understanding of both its
reported results presented in accordance with U.S. generally
accepted accounting principles ("GAAP") and its outlook, the
Company also presents non-GAAP measures of net income and net
income per share which are adjusted from results based on GAAP. In
particular, the Company excludes stock-based compensation expenses
and the related tax effects. The non-GAAP financial measures which
the Company discloses also exclude the effects of stock-based
compensation on the number of basic and diluted common shares used
in calculating non-GAAP basic and diluted net income per share. The
Company provides these non-GAAP financial measures to enhance an
investor's overall understanding of its current financial
performance and to assess its prospects for the future. These
non-GAAP financial measures reflect an additional way of viewing
aspects of the Company's operations that, when viewed with its GAAP
results and the accompanying reconciliations to the corresponding
GAAP financial measures, provide a more complete understanding of
factors and trends affecting the Company's business. The economic
basis for the Company's decision to use non-GAAP financial measures
is that the adjustments to net income did not reflect the on-going
relative strength of the Company's performance. The Company's
objective is to minimize any confusion in the financial markets by
providing non-GAAP net income and non-GAAP net income per share
measurements and disclosing the related components. These non-GAAP
financial measures should be considered as a supplement to, and not
as a substitute for, or superior to, the financial measures
prepared in accordance with GAAP.
The Company uses non-GAAP financial measures for internal
management purposes to conduct and evaluate its business, when
publicly providing its business outlook and to facilitate
period-to-period comparisons. The Company views non-GAAP net income
per share as a primary indicator of the profitability of its
underlying business. In addition, because stock-based compensation
is a non-cash expense and is offset in full by a credit to
additional paid-in capital, it has no effect on total stockholders'
equity. As the calculation of non-GAAP financial measures differs
between companies, the non-GAAP financial measures used by the
Company may not be comparable to similarly titled measures used by
other companies. Other than stock-based compensation and the
related tax effects, these differences may cause the Company's
non-GAAP measures to not be directly comparable to other companies'
non-GAAP measures. Although these non-GAAP financial measures
adjust cost, expenses and basic and diluted share items to exclude
the accounting treatment of stock-based compensation, they should
not be viewed as a non-GAAP presentation reflecting the elimination
of the underlying stock-based compensation programs. Thus, the
Company's non-GAAP presentations are not intended to present, and
should not be used, as a basis for assessing what its operating
results might be if it were to eliminate its stock-based
compensation programs. The Company compensates for these
limitations by providing full disclosure of the net income and net
income per share on a basis prepared in accordance with GAAP to
enable investors to consider net income and net income per share
determined under GAAP as well as on an adjusted basis, and perform
their own analysis, as appropriate. As a result of the foregoing
limitations, the Company does not use, nor does the Company intend
to use, the non-GAAP financial measures when assessing the
Company's performance against that of other companies.
Estimating stock-based compensation expenses and the related tax
effects for a future period is subject to inherent risks and
uncertainties, including but not limited to the price of the
Company's stock, stock market volatility, expected option life,
risk-free interest rates, and the number of option exercises and
sales during the quarter.
OMNIVISION
TECHNOLOGIES, INC
RECONCILIATION OF
GUIDANCE FOR GAAP NET INCOME PER DILUTED SHARE
TO PROJECTED
NON-GAAP NET INCOME PER DILUTED SHARE
(unaudited)
|
|
|
Three Months
Ending April 30, 2015
|
|
GAAP
Range of
Estimates
|
|
Non-GAAP
Range of
Estimates
|
|
From
|
To
|
Adjustment
|
From
|
To
|
Net income per
share
|
$ 0.02
|
$ 0.18
|
$
0.13(1)
|
$ 0.15
|
$ 0.31
|
|
|
|
|
|
|
(1)
Reflects estimated adjustment for expenses and related tax effects
associated with stock-based compensation.
|
OMNIVISION
TECHNOLOGIES, INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(in thousands,
except per share amounts)
(unaudited)
|
|
|
|
|
January 31,
|
April 30,
|
|
2015
|
2014
|
ASSETS
|
|
|
Current
assets:
|
|
|
Cash and cash
equivalents
|
$ 308,161
|
$ 297,952
|
Short-term
investments
|
204,626
|
152,993
|
Accounts receivable,
net
|
141,706
|
172,472
|
Inventories
|
366,379
|
270,935
|
Deferred income
taxes
|
4,553
|
4,973
|
Prepaid expenses and
other current assets
|
6,473
|
6,576
|
Recoverable insurance
proceeds
|
12,500
|
—
|
Total current assets
|
1,044,398
|
905,901
|
Property, plant and
equipment, net
|
148,516
|
153,792
|
Long-term
investments
|
145,310
|
154,409
|
Goodwill
|
10,227
|
10,227
|
Intangibles,
net
|
55,760
|
66,217
|
Other long-term
assets
|
25,194
|
32,529
|
Total assets
|
$ 1,429,405
|
$ 1,323,075
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$ 146,905
|
$ 142,012
|
Accrued expenses and
other current liabilities
|
28,583
|
31,959
|
Litigation settlement
accrual
|
12,500
|
—
|
Income taxes
payable
|
6,081
|
2,316
|
Deferred revenues,
less cost of revenues
|
19,709
|
25,783
|
Current portion of
long-term debt
|
7,071
|
3,802
|
Total current liabilities
|
220,849
|
205,872
|
Long-term
liabilities:
|
|
|
Long-term income taxes
payable
|
51,127
|
86,498
|
Non-current portion of
long-term debt
|
25,128
|
32,030
|
Other long-term
liabilities
|
21,853
|
11,818
|
Total long-term liabilities
|
98,108
|
130,346
|
Total liabilities
|
318,957
|
336,218
|
|
|
|
Stockholders'
equity:
|
|
|
Common stock, $0.001 par value; 100,000 shares authorized;
78,655 shares issued and 58,056 outstanding at
January 31, 2015 and 76,681 shares issued and
56,082 outstanding at April 30, 2014,
respectively
|
79
|
77
|
Additional paid-in capital
|
700,668
|
664,602
|
Accumulated other comprehensive income
|
2,507
|
2,378
|
Treasury stock, 20,599 at January 31, 2015 and April 30,
2014, respectively
|
(278,683)
|
(278,683)
|
Retained earnings
|
685,877
|
598,483
|
Total stockholders' equity
|
1,110,448
|
986,857
|
Total liabilities and stockholders' equity
|
$ 1,429,405
|
$ 1,323,075
|
OMNIVISION
TECHNOLOGIES, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(in thousands,
except per share amounts)
(unaudited)
|
|
|
|
|
Three Months
Ended
|
Nine Months
Ended
|
|
January 31,
|
January 31,
|
|
2015
|
2014
|
2015
|
2014
|
Revenues
|
$ 292,341
|
$ 352,023
|
$ 1,092,922
|
$ 1,122,960
|
Cost of
revenues
|
227,759
|
282,891
|
853,423
|
913,801
|
Gross
profit
|
64,582
|
69,132
|
239,499
|
209,159
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
Research, development
and related
|
33,190
|
30,936
|
102,108
|
87,761
|
Selling, general and
administrative
|
19,465
|
18,028
|
58,904
|
54,684
|
Amortization of
acquired patent portfolio
|
2,321
|
2,321
|
6,964
|
6,964
|
Total operating expenses
|
54,976
|
51,285
|
167,976
|
149,409
|
|
|
|
|
|
Income from
operations
|
9,606
|
17,847
|
71,523
|
59,750
|
Equity in earnings of
investee
|
1,279
|
837
|
3,248
|
3,264
|
Interest expense,
net
|
(404)
|
(466)
|
(1,256)
|
(1,542)
|
Other income,
net
|
324
|
24,038
|
1,588
|
25,206
|
Income before income
taxes
|
10,805
|
42,256
|
75,103
|
86,678
|
|
|
|
|
|
Provision for (benefit
from) income taxes
|
(3,218)
|
11,696
|
(12,291)
|
6,754
|
Net income
|
$ 14,023
|
$ 30,560
|
$ 87,394
|
$ 79,924
|
|
|
|
|
|
Net income per
share:
|
|
|
|
|
Basic
|
$ 0.24
|
$ 0.55
|
$
1.52
|
$
1.44
|
Diluted
|
$ 0.23
|
$ 0.54
|
$
1.48
|
$
1.42
|
|
|
|
|
|
Shares used in
computing net income per share:
|
|
|
|
|
Basic
|
57,948
|
55,913
|
57,383
|
55,369
|
Diluted
|
60,134
|
56,186
|
59,238
|
56,472
|
OMNIVISION
TECHNOLOGIES, INC.
RECONCILIATION OF
GAAP NET INCOME TO NON-GAAP NET INCOME
(in thousands,
except per share amounts)
(unaudited)
|
|
|
|
|
|
Three Months
Ended
|
Nine Months
Ended
|
Three Months
Ended
|
|
January 31,
|
January 31,
|
October 31,
|
|
2015
|
2014
|
2015
|
2014
|
2014
|
GAAP net
income
|
$ 14,023
|
$ 30,560
|
$ 87,394
|
$ 79,924
|
$ 28,044
|
Add:
|
|
|
|
|
|
Stock-based
compensation in cost of revenues
|
1,136
|
999
|
3,287
|
2,956
|
1,166
|
Stock-based
compensation in research, development and related
expenses
|
4,180
|
4,276
|
12,649
|
12,006
|
4,209
|
Stock-based
compensation in selling, general and administrative
expenses
|
3,396
|
3,668
|
9,880
|
10,950
|
3,280
|
Decrease in provision
for (benefit from) income taxes without the effect of stock-based
compensation
|
571
|
922
|
1,405
|
1,251
|
232
|
Non-GAAP net
income
|
$ 23,306
|
$ 40,425
|
$ 114,615
|
$ 107,087
|
$ 36,931
|
|
|
|
|
|
|
GAAP provision for
(benefit from) income taxes
|
$ (3,218)
|
$ 11,696
|
$ (12,291)
|
$ 6,754
|
$ 2,572
|
Decrease in provision
for (benefit from) income taxes without the effect of stock-based
compensation
|
571
|
922
|
1,405
|
1,251
|
232
|
Non-GAAP provision for
(benefit from) income taxes
|
$ (3,789)
|
$ 10,774
|
$ (13,696)
|
$ 5,503
|
$ 2,340
|
|
|
|
|
|
|
Non-GAAP net income per
share:
|
|
|
|
|
|
Basic
|
$ 0.40
|
$ 0.72
|
$ 2.00
|
$ 1.93
|
$ 0.64
|
Diluted
|
$ 0.38
|
$ 0.69
|
$ 1.87
|
$ 1.83
|
$ 0.60
|
|
|
|
|
|
|
Shares used in
computing non-GAAP net income per share:
|
|
|
|
|
|
Basic
|
57,948
|
55,913
|
57,383
|
55,369
|
57,617
|
Diluted
|
62,062
|
58,936
|
61,291
|
58,373
|
61,730
|
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SOURCE OmniVision Technologies, Inc.