Second Quarter Net Sales up 36% over Prior Year
GEORGE TOWN, Grand Cayman, Aug. 1 /PRNewswire-FirstCall/ -- O2Micro(R) International Limited (NASDAQ:OIIM)(SEHK:0457), a leading supplier of innovative power management, and security components and systems, reported its financial results today for the second quarter ended June 30, 2007.
Net sales for the second quarter of 2007 were $38.2 million, an increase of 9% from the preceding quarter, and up more than 36% from the second quarter of the prior year.
Second quarter R&D expenditures were $8.2 million or 22% of net sales. Currently, the Company employs over 600 engineers working on R&D worldwide. In the second quarter, O2Micro's intellectual property (IP) portfolio expanded by 8%, with 29 new patents issued.
Net income for the second quarter of 2007 was $5.7 million or 15 cents per fully diluted American Depositary Share (ADS). Second quarter net income was reduced by pre-tax litigation expense of $2.8 million.
"The Company continues to enhance its leadership position in analog and mixed signal power management products. We continue to grow our competitive positions of the markets we serve," commented Sterling Du, Chairman and CEO of O2Micro.
Mr. Du continues, "Our revenue growth can be attributed to the successful protection of our IP portfolio as well as the expansion of our analog and mixed signal IC sales in Consumer, Computer, Industrial, and Automotive markets, and the growing international acceptance of our Security Systems for the Communications market." Conference Call: O2Micro will hold its second quarter conference call today at 2:00 p.m. PDT, 5:00 p.m. EDT, and 5:00 a.m. (August 2, 2007) Hong Kong time. You may participate using the following dial-in information.
In the US and CANADA: 866-316-1370, pass code #8094090
In HONG KONG: 800-965-503, pass code #8094090
Other INTERNATIONAL participants: 913-312-6680, pass code #8094090 A replay of the call will be available by phone until August 8th using the following dial-in information.
In the US and CANADA: 888-203-1112, pass code #8094090
In HONG KONG: 800-901-108, pass code #8094090
Other INTERNATIONAL participants: 719-457-0820, pass code #8094090 A live simulcast will also be available on the company website at http://www.o2micro.com/, and an online replay will be available on the website for one week.
About O2Micro Founded in April 1995, O2Micro develops and markets innovative power management, and security components and systems for the Computer, Consumer, Industrial, and Communications markets. Products include Intelligent Lighting, Battery Management, Power Management, SmartCardBus(R) and Security products, such as VPN/Firewall system solutions.
O2Micro International maintains an extensive portfolio of intellectual property with 7,681 patent claims granted, and over 9,000 more pending. The company maintains offices worldwide. Additional company and product information can be found on the company website at http://www.o2micro.com/.
O2Micro, the O2Micro logo, SmartCardBus and combinations thereof are registered trademarks of O2Micro. All other trademarks are the property of their respective owners.
Certain statements in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. They include statements regarding O2Micro's future growth, long term profitability, increases in shareholder value, expansion of O2Micro's product and patent portfolios, legal expenditures, litigation activity and other statements regarding O2Micro's or management's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future. Such statements involve risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. Factors that could cause actual results to differ materially include risks and uncertainties such as reduced demand for products of electronic equipment manufacturers which include O2Micro's products due to adverse economic conditions in general or specifically affecting O2Micro's markets, technical difficulties and delays in the development process, and errors in the products. You are also referred to the Form F-1 in connection with the company's initial public offering in August 2000, Form F-3 in connection with the company's public offering in November 2001, and the annual reports on Form 20-F, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. The company assumes no obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.
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,
2007 2006 2007 2006 NET SALES $38,191 $28,029 $73,228 $57,138 COST OF SALES 16,518 12,535 32,440 25,342 GROSS PROFIT 21,673 15,494 40,788 31,796 OPERATING EXPENSES (INCOME)
Research and development (1) 8,219 8,106 16,173 15,222
Selling, general
and administrative (1) 8,670 6,811 16,798 13,395
Patent related litigation 2,755 3,091 6,010 5,352
Litigation income (3,364) (3,364) - -
Stock Exchange of Hong Kong
listing expenses - 396 - 396
Total Operating Expenses 16,280 18,404 35,617 34,365 INCOME (LOSS) FROM OPERATIONS 5,393 (2,910) 5,171 (2,569) NON-OPERATING INCOME
(EXPENSES)
Interest income 814 970 1,628 1,869
Impairment loss on long-term
investments - (756) - (756)
Foreign exchange gain (loss) 108 89 (148) 120
Other - net 5 (66) 7 (23)
Total Non-operating Income 927 237 1,487 1,210 INCOME (LOSS) BEFORE INCOME TAX 6,320 (2,673) 6,658 (1,359) INCOME TAX EXPENSE (BENEFIT) 578 (161) 817 122 NET INCOME (LOSS) 5,742 (2,512) 5,841 (1,481) OTHER COMPREHENSIVE INCOME
Foreign currency translation
adjustments 335 105 324 335
Unrealized gain on
available-for-sale securities 3,090 1,050 3,797 965 Total Other Comprehensive
Income 3,425 1,155 4,121 1,300 COMPREHENSIVE INCOME (LOSS) $9,167 ($1,357) $9,962 ($181) EARNINGS (LOSS) PER SHARE:
Basic $0.0030 ($0.0013) $0.0031 ($0.0008)
Diluted $0.0030 NA $0.0030 NA EARNINGS (LOSS) PER ADS
Basic $0.15 ($0.06) $0.15 ($0.04)
Diluted $0.15 NA $0.15 NA SHARES USED IN EARNINGS
PER SHARE CALCULATION:
Basic (in thousands) 1,904,024 1,962,097 1,905,620 1,962,866
Diluted (in thousands) 1,920,974 1,975,648 1,917,668 1,984,955 ADS UNITS USED IN EARNINGS
PER ADS CALCULATION:
Basic (in thousands) 38,080 39,242 38,112 39,257
Diluted (in thousands) 38,419 39,513 38,353 39,699 (1) INCLUDES STOCK-BASED
COMPENSATION CHARGE AS
FOLLOWS:
Research and development $278 $320 $530 $648
Selling, general and
administrative $354 $380 $704 $741 O2Micro International Limited and Subsidiaries
Consolidated Balance Sheets
(In Thousand U.S. Dollars, Except Share Amounts) June 30, December 31,
2007 2006
ASSETS (Unaudited) CURRENT ASSETS
Cash and cash equivalents $49,411 $45,438
Restricted cash 7,626 8,342
Short-term investments 16,945 19,697
Accounts receivable - net 25,113 18,987
Inventories 17,199 14,076
Prepaid expenses and other current assets 7,348 7,379
Total Current Assets 123,642 113,919 LONG-TERM INVESTMENTS 27,850 24,059 PROPERTY AND EQUIPMENT - NET 42,166 41,427 OTHER ASSETS
Restricted assets - net 13,998 14,540
Other Assets 3,269 3,075 TOTAL ASSETS $210,925 $197,020 LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Notes and accounts payable $13,349 $9,851
Income tax payable 622 991
Accrued expenses and other current liabilities 14,238 12,212
Total Current Liabilities 28,209 23,054 OTHER LONG-TERM LIABILITIES
Accrued pension liabilities 435 455
Long-term Interpretation 48 tax liabilities 117 - Total Liabilities 28,761 23,509 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 - 1,896,983,950 and 1,906,969,950
shares as of June 30, 2007 and December 31,
2006, respectively 38 38
Additional paid-in capital 140,829 140,224
Retained earnings 37,804 33,877
Accumulated other comprehensive income (loss) 3,493 (628) Total Shareholders' Equity 182,164 173,511 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $210,925 $197,020
DATASOURCE: O2Micro CONTACT: Mitchell Benus, Director of Investor Relations, of O2Micro, +1-408-332-1749, Web site: http://www.o2micro.com/
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