ZHUHAI, China, Nov. 4, 2014 /PRNewswire/ -- Actions
Semiconductor Co., Ltd. (Nasdaq: ACTS) ("Actions Semiconductor" or
"the Company"), 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 third quarter ended September 30, 2014.
All financial results are reported on a U.S. GAAP basis.
Revenue for the third quarter of 2014 was $13.1 million, as compared to revenue of
$12.0 million for the second quarter
of 2014, and $16.9 million for the
third quarter of 2013.
Net loss attributable to Actions Semiconductor's shareholders
for the third quarter of 2014 was $9.2
million or $0.137 per basic
and diluted American Depositary Share ("ADS"). This compares to net
loss attributable to Actions Semiconductor's shareholders of
$3.5 million or $0.050 per basic and diluted ADS, for the second
quarter of 2014, and net loss attributable to Actions
Semiconductor¡¯s shareholders of $0.2
million or $0.002 per basic
and diluted ADS, for the third quarter of 2013.
Actions Semiconductor reported gross margin of 14.6% for the
third quarter of 2014, compared to gross margin of 18.4% for the
second quarter of 2014, and 33.2% for the third quarter of 2013.
Gross margin was impacted by fierce competition in the tablet
market and a net inventory write-down that reduced margin by nearly
7%. The Company ended the third quarter with $161.3 million in cash and cash equivalents,
together with time deposits, trading securities and marketable
securities, current and non-current.
Since the share repurchase program commenced in 2007, the
Company has invested approximately $78.9
million in repurchasing its ADSs and ordinary shares,
including $25.0 million representing
the equivalent of 10.0 million ADSs repurchased through a Dutch
auction tender offer in September
2014. As of September 30,
2014, the equivalent of approximately 33.7 million ADSs were
repurchased.
"In the third quarter of 2014, revenue came in toward the low
end of our expectations, primarily due to a supply shortage of
8-inch wafers for multimedia products from our foundry. Competition
in the worldwide tablet market remained intense, keeping selling
prices and margins low. Lower gross margin, combined with mask
expenses related to our new application processor enabled by 28nm
process technology and expenses related to our Dutch auction tender
offer contributed to the loss for the quarter," stated Dr.
Zhenyu Zhou, CEO of Actions
Semiconductor.
"Shipments of dual-core solutions accounted for the majority of
tablet shipments during the quarter, and we saw a twofold increase
in shipments of quad-core solutions, indicative of the accelerated
migration from dual-core to quad-core solutions in the overseas
tablet market. We expect another sequential increase in shipments
in the fourth quarter, although challenging conditions in the
tablet market will persist for the next few quarters.
"As we approach the end of 2014, we believe we are through the
most challenging period in our tablet business and are preparing to
harvest our investments in 28nm process technology and 64-bit
architecture in the year ahead. We recently launched our first 28nm
OWL series chipset, the ATM7059, which will target the branded and
whitebox tablet market and Over-the-top ("OTT") set-top box market,
with a 64-bit solution to be launched before year end. We also see
strong potential in the Bluetooth boombox market, especially our
Bluetooth 4.0 solutions, which we expect to be a major revenue
driver in 2015 following the launch of our RF and audio processing
integrated single chip SoC for Bluetooth boomboxes and headphones,"
Dr. Zhou concluded.
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.
Based on current market trends, the Company expects revenue in
the fourth quarter of 2014 to be in the range of $14.0 to $16.0 million. The Company expects a
sequential improvement in shipments in the fourth quarter of 2014,
although challenging conditions in the tablet market will continue
to impact revenue and margins in the near term.
Conference Call Details
Actions Semiconductor's third quarter of fiscal year 2014
teleconference and webcast is scheduled to begin at 8:00 a.m. Eastern Time, on Tuesday, November 4, 2014. To participate in the
live call, analysts and investors should dial 1-888-427-9419
(within U.S.) or 1-719-325-2463 (outside U.S.) at least ten minutes
prior to the call. The conference ID number is 2795511. 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 November 14, 2014 by dialing 1-888-203-1112
(within U.S.) or 1-719-457-0820 (outside U.S.) and entering access
code 2795511.
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,
Shenzhen, Hong Kong and Taipei. 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 the
outlook for its new products enabled by 28nm process technology and
64-bit CPU for tablets and high-end OTT set-top boxes and new RF
and audio processing integrated single chip SoC for Bluetooth
boomboxes, customer acceptance of the Actions Semiconductor¡¯s new
products and corresponding increases in market share, Actions
Semiconductor's belief that it is through the most challenging
period in its tablet business and is positioned to capture some
upside from its new products and Actions Semiconductor's future
expectations with respect to revenue. 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:
Elaine Ketchmere,
CFA
|
Ally Xie, CA,
CPA
|
Compass Investor
Relations
|
Semiconductor
|
eketchmere@compass-ir.com
|
investor.relations@actions-semi.com
|
+1-310-528-3031
|
+86-756-3392353*1018
|
ACTIONS
SEMICONDUCTOR CO., LTD.
|
CONSOLIDATED
CONDENSED BALANCE SHEETS
|
(in thousands of
U.S. dollars)
|
|
|
|
|
|
|
|
At September 30,
|
|
At June
30,
|
|
At December 31,
|
|
2014
|
|
2014
|
|
2013
|
|
(unaudited)
|
|
(unaudited)
|
|
(audited)
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
78,520
|
|
60,888
|
|
53,263
|
Time
deposit
|
161
|
|
327
|
|
327
|
Restricted
deposits
|
38,985
|
|
32,463
|
|
27,181
|
Marketable
securities
|
43,520
|
|
79,664
|
|
126,607
|
Trading
securities
|
74
|
|
74
|
|
74
|
Accounts
receivable, net of allowance for doubtful accounts of $379, $185
and $nil
as of September 30,2014, June
30, 2014 and December 31, 2013 respectively
|
4,520
|
|
5,196
|
|
5,782
|
Amount due
from a related party
|
1,032
|
|
737
|
|
1,301
|
Amount due
from an equity method investee
|
46
|
|
43
|
|
38
|
Inventories,
net of inventory written-down of $3,747, $2,845 and $1,558 as
of
September 30, 2014, June 30, 2014 and
December 31, 2013 respectively
|
22,806
|
|
27,216
|
|
20,278
|
Prepaid
expenses and other current assets
|
3,563
|
|
3,831
|
|
3,972
|
Income tax
recoverable
|
154
|
|
85
|
|
67
|
Dividend
receivable
|
-
|
|
425
|
|
-
|
Deferred tax
assets
|
848
|
|
809
|
|
416
|
Total current
assets
|
194,229
|
|
211,758
|
|
239,306
|
|
|
|
|
|
|
Investments in
equity method investees
|
27,061
|
|
26,992
|
|
17,843
|
Other
investments
|
15,639
|
|
15,625
|
|
15,648
|
Marketable
securities
|
-
|
|
16,067
|
|
17,139
|
Rental
deposits
|
55
|
|
61
|
|
61
|
Property,
plant and equipment, net
|
31,183
|
|
30,886
|
|
31,896
|
Land use
right
|
1,545
|
|
1,530
|
|
1,588
|
Acquired
intangible assets, net
|
17,684
|
|
19,115
|
|
12,218
|
Deposit paid
for acquisition of intangible assets
|
430
|
|
489
|
|
145
|
Deferred tax
assets
|
85
|
|
89
|
|
99
|
TOTAL
ASSETS
|
287,911
|
|
322,612
|
|
335,943
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts
payable
|
5,170
|
|
7,267
|
|
6,016
|
Accrued
expenses and other current liabilities
|
9,680
|
|
9,521
|
|
6,127
|
Short-term
bank loans
|
33,500
|
|
34,500
|
|
35,500
|
Other
liabilities
|
1,728
|
|
1,698
|
|
1,362
|
Income tax
payable
|
49
|
|
49
|
|
49
|
Deferred tax
liabilities
|
108
|
|
339
|
|
343
|
Total current
liabilities
|
50,235
|
|
53,374
|
|
49,397
|
|
|
|
|
|
|
Other
liabilities
|
229
|
|
-
|
|
412
|
Deferred tax
liabilities
|
958
|
|
988
|
|
3,589
|
Total liabilities
|
51,422
|
|
54,362
|
|
53,398
|
Equity:
|
|
|
|
|
|
Ordinary
shares
|
1
|
|
1
|
|
1
|
Additional
paid-in capital
|
63,017
|
|
63,012
|
|
63,001
|
Treasury
Stock
|
(70,170)
|
|
(45,055)
|
|
(44,119)
|
Accumulated
other comprehensive income
|
38,919
|
|
36,327
|
|
40,734
|
Retained
earnings
|
204,754
|
|
213,997
|
|
222,959
|
Total Actions
Semiconductor Co., Ltd. shareholders' equity
|
236,521
|
|
268,282
|
|
282,576
|
Non-controlling
interest
|
(32)
|
|
(32)
|
|
(31)
|
Total
equity
|
236,489
|
|
268,250
|
|
282,545
|
TOTAL LIABILITIES
AND EQUITY
|
287,911
|
|
322,612
|
|
335,943
|
ACTIONS
SEMICONDUCTOR CO., LTD.
|
CONSOLIDATED
CONDENSED STATEMENT OF OPERATIONS
|
(in thousands of
U.S. dollars, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
Three months ended
|
|
Nine months ended
|
|
Nine months ended
|
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
System-on-a-chip products
|
|
13,084
|
|
16,830
|
|
36,317
|
|
51,710
|
Semiconductor product testing services
|
|
27
|
|
54
|
|
81
|
|
106
|
Total
revenues
|
|
13,111
|
|
16,884
|
|
36,398
|
|
51,816
|
Cost of
revenues:
|
|
|
|
|
|
|
|
|
System-on-a-chip products
|
|
(11,188)
|
|
(11,248)
|
|
(29,633)
|
|
(34,246)
|
Semiconductor product testing services
|
|
(11)
|
|
(27)
|
|
(38)
|
|
(45)
|
Total cost of
revenues
|
|
(11,199)
|
|
(11,275)
|
|
(29,671)
|
|
(34,291)
|
Gross
profit
|
|
1,912
|
|
5,609
|
|
6,727
|
|
17,525
|
Other operating
income
|
|
30
|
|
501
|
|
659
|
|
653
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development
|
|
(10,667)
|
|
(6,547)
|
|
(24,057)
|
|
(19,909)
|
General and
administrative
|
|
(3,130)
|
|
(2,133)
|
|
(7,954)
|
|
(6,217)
|
Selling and
marketing
|
|
(556)
|
|
(447)
|
|
(1,574)
|
|
(1,443)
|
Total operating
expenses
|
|
(14,353)
|
|
(9,127)
|
|
(33,585)
|
|
(27,569)
|
Loss from
operations
|
|
(12,411)
|
|
(3,017)
|
|
(26,199)
|
|
(9,391)
|
Other income
(expenses)
|
|
846
|
|
187
|
|
(1,651)
|
|
1,557
|
Dividend income from
an other investment
|
|
-
|
|
-
|
|
423
|
|
493
|
Interest
income
|
|
2,029
|
|
2,926
|
|
7,912
|
|
9,117
|
Interest
expense
|
|
(87)
|
|
(128)
|
|
(383)
|
|
(352)
|
(Loss) income before
income taxes, equity in net income (loss) of
equity method investees and non-controlling interest
|
|
(9,623)
|
|
(32)
|
|
(19,898)
|
|
1,424
|
Income tax credit
(expense)
|
|
353
|
|
(197)
|
|
1,459
|
|
(295)
|
Equity in net income
(loss) of equity method investees
|
|
27
|
|
77
|
|
234
|
|
(182)
|
Net (loss)
income
|
|
(9,243)
|
|
(152)
|
|
(18,205)
|
|
947
|
Add: Net loss
attributable to non-controlling interest
|
|
-
|
|
-
|
|
-
|
|
1
|
Net (loss) income
attributable to Actions Semiconductor Co., Ltd.
|
|
(9,243)
|
|
(152)
|
|
(18,205)
|
|
948
|
|
|
|
|
|
|
|
|
|
Net (loss) income
attributable to Actions Semiconductor Co., Ltd.
|
|
|
|
|
|
|
|
|
Basic (per
share)
|
|
(0.023)
|
|
(0.000)
|
|
(0.044)
|
|
0.002
|
Diluted (per
share)
|
(0.023)
|
|
(0.000)
|
|
(0.044)
|
|
0.002
|
|
|
|
|
|
|
|
|
|
Basic (per
ADS)
|
|
(0.137)
|
|
(0.002)
|
|
(0.267)
|
|
0.014
|
Diluted (per
ADS)
|
|
(0.137)
|
|
(0.002)
|
|
(0.267)
|
|
0.013
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares used in computation:
|
|
|
|
|
|
|
|
|
Basic
|
|
403,462,431
|
|
413,849,403
|
|
409,491,710
|
|
412,083,249
|
Diluted
|
|
403,462,431
|
|
413,849,403
|
|
409,491,710
|
|
425,687,178
|
|
|
|
|
|
|
|
|
|
Weighted-average ADS
used in computation :
|
|
|
|
|
|
|
|
|
Basic
|
|
67,243,739
|
|
68,974,901
|
|
68,248,618
|
|
68,680,542
|
Diluted
|
|
67,243,739
|
|
68,974,901
|
|
68,248,618
|
|
70,947,863
|
|
|
|
|
|
|
|
|
|
Note: Share-based
compensation recorded in each
|
|
|
|
|
|
|
|
|
expense
classification above is as follows:
|
|
|
|
|
|
|
|
|
Research and
development
|
|
3
|
|
68
|
|
10
|
|
273
|
General and
administrative
|
|
1
|
|
22
|
|
5
|
|
54
|
Selling and
marketing
|
|
-
|
|
3
|
|
-
|
|
14
|
Cost of
revenues
|
|
-
|
|
-
|
|
-
|
|
49
|
ACTIONS
SEMICONDUCTOR CO., LTD.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(in thousands of
U.S. dollars)
|
|
|
Three months ended
|
|
Nine months ended
|
|
Nine months ended
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
2014
|
|
2014
|
|
2013
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
Operating
activities:
|
|
|
|
|
|
Net (loss)
income
|
(9,243)
|
|
(18,205)
|
|
947
|
Adjustments to
reconcile net (loss) income to net cash provided by
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
Depreciation
of property, plant and equipment
|
457
|
|
1,462
|
|
1,564
|
Allowance for
doubtful accounts receivable
|
194
|
|
379
|
|
-
|
Amortization of land use right
|
9
|
|
27
|
|
27
|
Amortization
and impairment of acquired intangible assets
|
1,777
|
|
4,138
|
|
2,557
|
Utilization of
subsidy from local authorities of Zhuhai,
the People's Republic of China ("PRC")
|
-
|
|
-
|
|
(222)
|
Write down of
inventories
|
902
|
|
2,189
|
|
583
|
Gain on
disposal of property, plant and equipment
|
-
|
|
(3)
|
|
-
|
Loss on
disposal of intangible assets
|
-
|
|
415
|
|
-
|
Share of net
(gain) loss of equity method investees
|
(27)
|
|
(234)
|
|
182
|
Share-based compensation
|
5
|
|
16
|
|
390
|
Deferred
taxes
|
(288)
|
|
(3,277)
|
|
185
|
Dividend
income from another investment
|
-
|
|
(423)
|
|
(493)
|
Changes in
operating assets and liabilities:
|
|
|
|
|
|
Accounts receivable
|
510
|
|
862
|
|
(1,330)
|
Amount due from a related party
|
(295)
|
|
269
|
|
340
|
Inventories
|
3,852
|
|
(4,858)
|
|
(13,748)
|
Amount due from an equity method investee
|
(3)
|
|
(8)
|
|
4
|
Prepaid expenses and other current assets
|
325
|
|
369
|
|
6,852
|
Accounts payable
|
(2,158)
|
|
(815)
|
|
(1,868)
|
Accrued expenses and other current liabilities
|
30
|
|
(1,350)
|
|
(3,399)
|
Income tax recoverable
|
(68)
|
|
(88)
|
|
110
|
Income tax payable
|
-
|
|
-
|
|
1
|
Rental deposit received (paid)
|
7
|
|
5
|
|
(16)
|
Note Receivables
|
-
|
|
-
|
|
(37)
|
Dividend
received
|
425
|
|
425
|
|
-
|
Net cash used in
operating activities
|
(3,589)
|
|
(18,705)
|
|
(7,371)
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
Investment in
an equity method investee
|
-
|
|
(9,016)
|
|
(3,712)
|
Proceeds from
redemption of marketable securities
|
57,955
|
|
153,277
|
|
99,532
|
Purchase of
marketable securities
|
(4,990)
|
|
(53,384)
|
|
(82,800)
|
Proceeds from
disposal of property, plant and equipment
|
1
|
|
20
|
|
16
|
Purchase of
property, plant and equipment
|
(307)
|
|
(1,090)
|
|
(522)
|
Purchase of
intangible assets
|
(159)
|
|
(5,438)
|
|
(2,685)
|
Increase in
restricted deposits
|
(6,165)
|
|
(11,885)
|
|
(11,199)
|
Decrease in
time deposits
|
162
|
|
162
|
|
-
|
Deposit paid
for acquisition of intangible assets
|
-
|
|
(349)
|
|
(759)
|
Proceeds from
disposal of intangible assets
|
-
|
|
24
|
|
-
|
Net cash provided by
(used in) investing activities
|
46,497
|
|
72,321
|
|
(2,129)
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
Advance
subsidy from local authorities of Zhuhai, the PRC
|
232
|
|
232
|
|
302
|
Proceeds from
exercise of share option and restricted stock unit
|
757
|
|
2,410
|
|
2,570
|
Repurchase of
ordinary shares
|
(25,872)
|
|
(28,461)
|
|
(3,008)
|
Raise of
short-term bank loans
|
-
|
|
10,000
|
|
5,000
|
Repayment of
short-term bank loans
|
(1,000)
|
|
(12,000)
|
|
-
|
Net cash (used in)
provided by financing activities
|
(25,883)
|
|
(27,819)
|
|
4,864
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
17,025
|
|
25,797
|
|
(4,636)
|
|
|
|
|
|
|
Cash and cash
equivalents at the beginning of the period
|
60,888
|
|
53,263
|
|
71,336
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
607
|
|
(540)
|
|
1,184
|
Cash and cash
equivalents at the end of the period
|
78,520
|
|
78,520
|
|
67,884
|
SOURCE Actions Semiconductor Co., Ltd.