Company Beats Q4 2015 Revenue, Gross
Margin and EPS Guidance
Himax Technologies, Inc. (Nasdaq:HIMX) (“Himax” or “Company”), a
leading supplier and fabless manufacturer of display drivers and
other semiconductor products, announced its financial results for
the fourth quarter and full year ended December 31, 2015.
SUMMARY FINANCIALS
Fourth Quarter 2015 Results
Compared to Fourth
Quarter 2014 Results (USD in
millions) (unaudited) |
|
Q4 2015 |
Q4 2014 |
CHANGE |
Net Revenues |
$178.0 million |
$227.2 million |
|
-21.7 |
% |
Gross Profit |
$40.7 million |
$56.0 million |
|
-27.3 |
% |
Gross Margin |
|
22.9 |
% |
|
24.7 |
% |
|
-1.8 |
% |
GAAP Net Income
Attributable to Shareholders |
$6.1 million |
$15.6 million |
|
-60.8 |
% |
Non-GAAP Net Income
Attributable to Shareholders |
$6.5 million (1) |
$16.1 million (2) |
|
-59.7 |
% |
GAAP EPS (Per Diluted ADS,
USD) |
$ |
0.036 |
|
$ |
0.091 |
|
|
-60.8 |
% |
Non-GAAP EPS (Per Diluted
ADS, USD) |
$0.038 (1) |
$0.094 (2) |
|
-59.8 |
% |
(1) Non-GAAP Net income attributable to common
shareholders and EPS excludes $0.2 million share-based compensation
expenses, net of tax and $0.2 million non-cash acquisition related
charge, net of tax.(2) Non-GAAP Net income attributable to common
shareholders and EPS excludes $0.4 million of share-based
compensation expenses, net of tax and $0.1 million non-cash
acquisition related charges, net of tax.
Fourth Quarter 2015 Results Compared to
Third Quarter 2015 Results (USD in
millions) (unaudited) |
|
Q4 2015 |
Q3 2015 |
CHANGE |
Net
Revenue |
$178.0 million |
$165.6 million |
|
+7.5 |
% |
Gross
Profit |
$40.7 million |
$36.1 million |
|
+12.9 |
% |
Gross
Margin |
|
22.9 |
% |
|
21.8 |
% |
|
+1.1 |
% |
GAAP Net
Income (Loss) Attributable to Shareholders |
$6.1
million |
$(2.3) million |
|
+362.9 |
% |
Non-GAAP Net
Income Attributable to Shareholders |
$6.5 million (1) |
$1.7 million (2) |
|
+286.4 |
% |
GAAP EPS (Per
Diluted ADS, USD) |
$ |
0.036 |
|
$ |
(0.014 |
) |
|
+362.3 |
% |
Non-GAAP EPS
(Per Diluted ADS, USD) |
$0.038 (1) |
$0.010 (2) |
|
+285.6 |
% |
(1) Non-GAAP Net income attributable to common
shareholders and EPS excludes $0.2 million share-based compensation
expenses, net of tax and $0.2 million non-cash acquisition related
charge, net of tax.(2) Non-GAAP Net income attributable to common
shareholders and EPS excludes $3.9 million of share-based
compensation expenses, net of tax and $0.1 million non-cash
acquisition related charge, net of tax.
"Our 2015 fourth quarter results beat our
guidance as preannounced on January 7. Our 2015 fourth quarter
revenue was $178.0 million, representing 7.5% sequential increase.
It is in line with our preannouncement and outperformed the
original guidance of flat to 5% up quarter-over-quarter. Gross
margin for the quarter was 22.9%, also beating the original
guidance of ‘flat to slightly up’ sequentially. Fourth quarter GAAP
earnings per diluted ADS came in at 3.6 cents, reaching the high
end of our preannounced GAAP EPS range of 3.3 to 3.8 cents and beat
our initially guided 1.0 to 3.0 cents. The strong result came from
all three product categories,” began Mr. Jordan Wu, President and
Chief Executive Officer of Himax. “Notably, we saw increased market
share of our large panel driver ICs, new addition of a major
smartphone customer for small and medium-sized driver ICs and
shipments of AR/VR related products. 2015 was a difficult year with
different challenges every quarter. Despite hints of a continued
market softness and tougher competition in mobile devices and TV,
we were able to exit the year of 2015 with decent sequential
growth. We believe such strength will continue into 2016. During
2015, our increased large panel driver IC market share in China has
helped us solidify the foundation of our core business, and has
brought in a strong flow sales and new opportunities as our Chinese
customers continue to expand their panel capacities while Chinese
TV makers are sourcing more panels locally. Equally important,
following quite a few quarters of sales decline in small and
medium-sized driver ICs, we finally saw smartphone order
rebounds coming from the industry’s restocking and new model
launches in the last quarter, especially from our leading brand
customers. Two of the key achievements of our smartphone driver IC
business are the completion of our qualification by a primary
Korean customer for our OLED driver IC design and the successful
launch of our TDDI (Touch and Display Driver Integration) products
in 2015. Both products were actively sought after by mobile device
makers, module houses, and panel makers. Lastly, some of the
world’s largest and most impactful technology companies have
continued to work closely with us on their AR/VR devices using our
LCOS, WLO and/or driver IC solutions. Some of them have announced
the launch of their products in 2016. We are seeing strong momentum
across all our major product lines and feel excited about the
growth prospect of 2016, despite the uncertain economic
environment.”
Fourth Quarter 2015 Revenue Breakdown by Product Line
(USD in millions) (unaudited)
|
Q4
2015 |
% |
Q4
2014 |
% |
%
Change |
Display drivers for large-sized panels |
$ |
62.1 |
|
|
34.9 |
% |
$ |
65.5 |
|
|
28.8 |
% |
|
-5.2 |
% |
Display drivers for small/medium-sized
panels |
$ |
81.9 |
|
|
46.0 |
% |
$ |
114.8 |
|
|
50.5 |
% |
|
-28.7 |
% |
Non-driver products |
$ |
34.0 |
|
|
19.1 |
% |
$ |
46.9 |
|
|
20.7 |
% |
|
-27.4 |
% |
Total |
$ |
178.0 |
|
|
100.0 |
% |
$ |
227.2 |
|
|
100.0 |
% |
|
-21.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4
2015 |
% |
Q3
2015 |
% |
%
Change |
Display drivers for large-sized panels |
$ |
62.1 |
|
|
34.9 |
% |
$ |
50.5 |
|
|
30.5 |
% |
|
+22.9 |
% |
Display drivers for small/medium-sized
panels |
$ |
81.9 |
|
|
46.0 |
% |
$ |
84.3 |
|
|
50.9 |
% |
|
-2.9 |
% |
Non-driver products |
$ |
34.0 |
|
|
19.1 |
% |
$ |
30.8 |
|
|
18.6 |
% |
|
+10.5 |
% |
Total |
$ |
178.0 |
|
|
100.0 |
% |
$ |
165.6 |
|
|
100.0 |
% |
|
+7.5 |
% |
|
|
|
|
|
|
Himax’s fourth quarter revenue of $178.0 million
represented a 7.5% sequential increase from the previous quarter
and a 21.7% decrease from the same period last year. Overall, sales
came in better than guided across all three product lines during
the quarter. Notably, the Company saw increased market share of its
large panel driver ICs, new addition of a major smartphone customer
for small and medium-sized driver ICs, and shipments of AR/VR
related products.
Revenue from large panel display drivers was
$62.1 million, up 22.9% sequentially, and down 5.2% from a year
ago. Large panel driver ICs accounted for 34.9% of Himax’s total
revenues for the fourth quarter, compared to 30.5% in the last
quarter and 28.8% a year ago. NB demand remained weak, yet the
Company’s driver IC business for TVs and monitors grew more than
20% sequentially while, according to the market research firm IHS,
worldwide TV and monitor panel shipments decreased 2% during the
same period. This bright spot, as Himax has repeatedly emphasized,
came from its long-standing leading market share in China’s
fast-expanding panel manufacturing base. If looking only at China,
the Company’s driver IC revenue grew close to 40% sequentially for
each of NB, monitor and TV applications in the fourth quarter of
2015. Overall large panel driver IC for Chinese panel customers
grew 16.9% year-over-year. Himax’s leading market share, coupled
with rapid capacity ramping of Chinese panel customers and more
in-sourcing from their local set maker customers, have led to this
favorable result. It is especially worth highlighting that Himax’s
engineering collaboration and design-in activities with Chinese
panel customers remain robust despite the soft market
sentiment.
Revenue for small and medium-sized drivers came
in at $81.9 million, down 2.9% sequentially and down 28.7% from the
same period last year. Driver ICs for small and medium-sized
applications accounted for 46.0% of total sales for the fourth
quarter, as compared to 50.9% in the previous quarter and 50.5% a
year ago. The main reason behind the weak performance was the loss
of business from the Company’s primary Korean end customer as they
replaced the use of LCD displays, for which Himax was a major IC
vendor, by AMOLED for their smartphone products, thereby creating a
gap in the Company’s small and medium-sized business. While with a
much reduced volume, Himax remained a major IC partner to this
Korean customer for their LCD displays and is working on AMOLED
projects with them. Business from Chinese smartphone makers grew
significantly over the last quarter due to their new model launches
and inventory replenishing, as well as the addition of a Chinese
new top-tier customer for one of their high-volume models. Compared
to the same quarter last year, revenues for Chinese smartphones
stayed around flat. For automotive applications, Himax continued to
see solid momentum, growing high teens from the third quarter and
around 3% year-over-year. The Company’s revenues for tablet segment
grew around 9% sequentially, a result of strong shipments to
certain international brand customers. The tablet sector registered
a year-over-year decline of around 17%, a reflection of the overall
weakness of the tablet market.
Revenues from non-driver businesses were $34.0
million, up 10.5% sequentially and down 27.4% from the same period
last year. Non-driver products accounted for 19.1% of total
revenues, as compared to 18.6% in the previous quarter and 20.7% a
year ago. CMOS image sensor business was the main factor behind the
year-over-year decline. Himax’s CMOS Image sensor business suffered
because the Company didn’t ramp its 8MP and 13MP sensors as planned
due to the lack of Phase Detection Auto Focus (PDAF), a new but
nowadays-required feature for high end smartphone. Himax remained
one of the market share leaders in notebook sector. The sequential
growth of its non-driver segment was mainly contributed by AR/VR
related businesses. Himax’s LCOS and WLO revenues started to show
growth as it started to make shipments to certain leading customers
in September. Development fees from AR/VR project engagements with
both current and new customers also worked in its favor. Among the
non-driver products, power management ICs also delivered impressive
growth sequentially.
GAAP gross margin for the fourth quarter was
22.9%, a 110 basis points increase from 21.8% in the previous
quarter and down 180 basis points from 24.7% in the same period
last year. The gross margin beat the Company’s initial guidance
mainly due to a more favorable product mix, including more high-end
smartphone and tablet driver IC shipments and higher development
fee incomes from LCOS and WLO businesses. Such increased
development activities will eventually lead to mass production of
these products, which will enhance the Company’s gross margin even
further in the long run. Gross margin expansion was also a
testament to Himax’s costs-down measures. Gross margin improvement
remains one of the Company’s business focuses.
Fourth quarter GAAP operating expenses were
$32.1 million, down 16.6% from the previous quarter and down 3.8%
from a year ago. The sequential decrease was primarily the result
of the difference in RSU charges. In accordance with the Company’s
protocol, Himax grants annual RSUs to its staff at the end of
September each year, which, given all other items equal, leads to
higher third quarter GAAP operating expenses compared to the other
quarters of the year. The fourth quarter RSU expense was only $0.3
million while it was $4.5 million in the third quarter. Excluding
the RSU expense, operating expenses decreased 6.5% from last
quarter and down 3.3% year-over-year. The sequential decrease was
the result of streamlining core business R&D activities and
other expense control measures.
GAAP operating income for the fourth quarter of
2015 was $8.6 million or 4.8% of sales, up 449.9% sequentially and
down 62.0% year-over-year. The sequential profit increase was from
higher revenue, enhanced gross margin, and lower operating expenses
including less RSU expenses. The year-over-year decline was, on the
contrary, a result of lower revenue and gross margin, but offset by
lowered operating expenses.
Reported GAAP net income for the fourth quarter
was $6.1 million, or 3.6 cents per diluted ADS, compared to GAAP
net loss of $2.3 million, or 1.4 cents per diluted ADS, in the
previous quarter and GAAP net income of $15.6 million, or 9.1 cents
per diluted ADS, for the same period last year. GAAP EPS exceeded
the Company’s 1.0 to 3.0 cents guided range.
In the Company’s last earnings call, it
estimated $3.1 million of additional income tax charges caused by
the NTD depreciation based on the exchange rate of 32.66 on
November 12th, the date of the EPS guidance. As it turned out, from
November 12th to the year end, the NTD further depreciated to 32.83
against the USD, resulting in an additional $0.5 million, or 0.3
cents per diluted ADS, of income tax charges. If the NTD/USD rate
had stayed at 32.66, Himax’s EPS would have been 3.9 cents,
outperforming its original guidance even more. The exchange rate
has very little effect on the Company’s margins and operating
results as Himax maintains vast majority of its cash, conducts its
entire buy and sell activities, and keep its books all in US
dollars. The only major impact it has is on the effective income
tax. This is because the Company pays literally all its taxes in
Taiwan where tax authorities determine Himax’s tax based on NT
dollar dominated ROC GAAP accounting. In general, as NT dollar
depreciates against US dollar, the Company is worse off in its US
GAAP effective tax rate and vice versa. Himax chooses to maintain
natural hedge in its operational activities as it believes this
minimizes the overall exchange rate impact over time.
The sequential profit increase was a result of
higher revenue and gross margin, together with lower operating
expenses. The year-over-year profit decline was due to decline in
revenue and gross margin but lower operating expenses helped offset
some of the bottom line decline.
Fourth quarter non-GAAP net income, which
excludes share-based compensation and acquisition-related charges,
was $6.5 million, or 3.8 cents per diluted ADS, compared to $1.7
million last quarter and $16.1 million the same period last
year.
Full Year 2015 Financial Results
FY 2015 Results Compared
to FY 2014 Results (USD
in millions) (unaudited) |
|
FY 2015 |
FY 2014 |
CHANGE |
Net Revenues |
$691.8 million |
$840.5 million |
|
-17.7 |
% |
Gross Profit |
$163.1 million |
$205.9 million |
|
-20.8 |
% |
Gross Margin |
|
23.6 |
% |
|
24.5 |
% |
|
-0.9 |
% |
GAAP Net Income
Attributable to Shareholders |
$25.2 million |
$66.6 million |
|
-62.2 |
% |
Non-GAAP Net Income
Attributable to Shareholders |
$30.6 million (1) |
$76.0 million (2) |
|
-59.7 |
% |
GAAP EPS (Per Diluted ADS,
USD) |
$ |
0.146 |
|
$ |
0.387 |
|
|
-62.2 |
% |
Non-GAAP EPS (Per Diluted
ADS, USD) |
$0.178 (1) |
$0.442 (2) |
|
-59.7 |
% |
(1) Non-GAAP Net income attributable to common
shareholders and EPS excludes $4.9 million share-based compensation
expenses, net of tax and $0.5 million non-cash acquisition related
charge, net of tax.(2) Non-GAAP Net income attributable to common
shareholders and EPS excludes $8.8 million of share-based
compensation expenses, net of tax and $0.6 million non-cash
acquisition related charges, net of tax.
FY
2015 Revenue Breakdown by Product Line (USD in millions)
(unaudited) |
|
|
|
|
|
|
|
FY 2015 |
% |
FY 2014 |
% |
% Change |
Display drivers for
large-sized panels |
$ |
224.4 |
|
|
32.4 |
% |
$ |
226.1 |
|
|
26.9 |
% |
|
-0.7 |
% |
Display drivers for
small/medium-sized panels |
$ |
336.0 |
|
|
48.6 |
% |
$ |
446.0 |
|
|
53.1 |
% |
|
-24.7 |
% |
Non-driver products |
$ |
131.4 |
|
|
19.0 |
% |
$ |
168.4 |
|
|
20.0 |
% |
|
-22.0 |
% |
Total |
$ |
691.8 |
|
|
100.0 |
% |
$ |
840.5 |
|
|
100.0 |
% |
|
-17.7 |
% |
Revenues totaled $691.8 million in 2015,
representing a 17.7% decrease over 2014. Revenues from large panel
display drivers declined 0.7% year-over-year, representing 32.4% of
total revenues, as compared to 26.9% in 2014. Notably, TV
application grew over 20% year-over-year, the highest growth since
2011. Such strength was originated from the Company’s focus in
China starting 2012 as it bets on China’s long term prospect and
sought to diversify customer base. Himax believes that panel
capacity expansion in China is a tailwind ride uniquely for the
Company, and its large panel driver IC sales and market share will
further improve as it moves into 2016 as a result.
Small and medium-sized driver sales declined
24.7% year-over-year, representing 48.6% of total revenues, as
compared to 53.1% in 2014. Himax’s key Korean end-customer’s
decision to substantially increase the portion of AMOLED panels in
their smartphone portfolio was the main reason that caused the
Company’s smartphone drivers to decline. The Company’s driver sales
for small and medium size panels were also hit by the weak
smartphone sales in China where smartphone vendors, lacking new
government stimulus, turned conservative while trying new sales
channels such as e-commerce and direct sales points to replace the
previous approach of selling through telecom operators. Worse yet,
exports were also weakened by the relatively strong RMB over the
full year. However, the Chinese smartphone market started to
rebound in the fourth quarter. Smartphone aside, Himax’s driver IC
sales into the tablet market also declined significantly
year-over-year while those for automotive applications grew double
digit. The Company would like to reiterate that despite the fast
changes in the smartphone makers’ competition landscape, it remains
the leading supplier of small and medium-sized driver IC for panel
makers and module houses across Taiwan, Korea, China and Japan. Now
that Himax’s smartphone end customers have recaptured the market
with refreshed marketing strategies, new model launches and better
grasp of internet sales channels, and with its latest addition of a
major brand customer, the Company is well-positioned to grow again
in 2016.
Non-driver products declined 22.0%
year-over-year, representing 19.0% of total sales, as compared to
20.0% a year ago. As explained earlier, CMOS image sensors’ decline
was the main reason behind the poor performance. LCOS, WLO and
timing controllers actually grew strongly last year. Himax launched
eDP 1.4 timing controller, targeting high end monitors, NBs and
tablets, and have received positive feedbacks and strong customer
adoption as the Company was the first to launch such timing
controller capable of supporting resolutions of up to 4K for
medium-sized panels.
The Company indicated before that its LCOS and
WLO business hit inflection in September 2015 with pilot production
shipment made to a major customer. The increasing shipments of its
LCOS and WLO products to some industry heavyweights in the fourth
quarter 2015 and the additional design engagements with current and
new customers are evidence that Himax is uniquely positioned as the
provider of choice for microdisplay and related optics to enable AR
applications. Separately, Himax has officially broken into the VR
space with major design-wins taking place toward the end of 2015.
The Company’s expertise in customized display solutions in OLED
driver IC, timing controller, and power management ICs have led to
ASIC developments that will go into the next generation panels of
several VR devices. With multiple AR/VR players announcing their
product launches in 2016, Himax stands to benefit from these new
businesses.
Himax’s touch panel controller sales remained
flat year-over-year in 2015. The introduction and mass shipment of
on-cell and pure in-cell products have led to fast customer
additions in its touch business in 2015. The Company continues to
believe that TDDI will start to take off starting 2H16.
Gross margin in 2015 was 23.6%, a 90 basis-point
decline from 24.5% in 2014. The margin decline was mainly the
result of pricing pressures passed on to driver IC vendors from
cost sensitive panel makers. Pressure on gross margin was partially
offset by higher development incomes from LCOS and WLO products and
higher sales of driver ICs for high end smartphones in the fourth
quarter.
GAAP operating expenses were $132.5 million,
down $0.7 million or 0.5% compared to last year. As repeatedly
indicated, the Company only intended to increase its expenses in
LCOS and WLO sectors, where it is seeing a lot of growth
opportunities. GAAP operating income of $30.7 million
represented a 57.8% decrease versus 2014.
GAAP net income for the year was $25.2 million,
or 14.6 cents per diluted ADS, down from $66.6 million, or 38.7
cents per diluted ADS, for the same period last year. The exchange
rate impact on income tax was $3.6 million for 2015 as NTD
depreciated to 32.83 against USD at end of 2015 from 31.65 at the
beginning of the year.
Non-GAAP net income for 2015 was $30.6 million,
or 17.8 cents per diluted ADS, down from $76.0 million, or 44.2
cents per diluted ADS, for 2014. The decrease in non-GAAP net
income was mainly the result of lower revenue in this year.
Balance Sheet and Cash Flow
Himax had $148.3 million of cash, cash
equivalents, and marketable securities at the end of December 2015,
compared to $187.8 million at the same time last year and $126.0
million a quarter ago. On top of the above cash position,
restricted cash was $180.4 million at the end of the quarter. The
restricted cash is mainly used to guarantee the company’s short
term loan for the same amount. Himax continues to maintain a very
strong balance sheet, and remains a debt-free company.
Inventories as of December 31, 2015 were $171.4
million, up from $166.1 million a year ago and down from $177.7
million a quarter ago. Himax was able to further lower inventory
levels sequentially because of demand rebound. The higher inventory
year-over-year was the result of the Company’s measures to counter
the relatively low customer demand visibility in a volatile market.
Accounts receivable at the end of December 2015 were $177.2 million
as compared to $219.4 million a year ago and $168.0 million last
quarter. DSO was 93 days at the end of December, 2015, little
changed from 95 days a year ago and 89 days at end of the last
quarter.
Net cash inflow from operating activities for
the fourth quarter was $25.9 million as compared to an inflow of
$38.7 million for the fourth quarter of 2014 and an inflow of $14.1
million for the third quarter of 2015. Cumulative cash inflow from
operations in 2015 was $22.5 million as compared to $93.7 million
in 2014. The decrease in cash flow is mainly due to lower net
profit and higher working capital.
Capital expenditures were $3.6 million in the
fourth quarter of 2015 versus $2.4 million a year ago and $2.6
million last quarter. The capital expenditure in the fourth quarter
consisted mainly of the manufacturing toolings of CMOS image sensor
products and facility updates and capacity expansion for LCOS and
WLO product lines. Total capital expenditures for the year were
$10.0 million versus $10.9 million a year ago.
In July 2015, Himax paid an annual dividend of
30 cents per ADS, equal to 77.5% of 2014 GAAP earnings per diluted
ADS. The Company remains committed to paying annual dividends, the
amount of which is based primarily on its prior year’s
profitability. The high payout ratio in 2015 is an illustration of
the Company’s confidence in its future profitability.
Share Buyback Update
As of December 31, 2015, Himax had 171.9 million
ADS outstanding, unchanged from last quarter. On a fully diluted
basis, the total ADS outstanding are 172.3 million.
2016 Investor Outreach and
Conferences
Ms. Jackie Chang, CFO, Ms. Nadiya Chen and Ms.
Penny Lin, internal IR Managers, and Mr. John Mattio, Himax’s
US-Based IR, will maintain corporate access for shareholders and
attend future investor conferences in the U.S. If you are
interested in speaking with the management, please contact Himax’s
US or Taiwan-based investor relations contact at the numbers
below.
Business Updates
The Company is mindful that 2016 will likely be
a year of macro uncertainty, marked by currency fluctuations and
the risk of China’s slowdown. However, looking ahead into the new
year, we believe our businesses will be resilient to macro
headwinds for reasons set out below. Himax’s large panel driver ICs
for TV application will grow from higher 4K TV penetration and the
added capacities from China. In terms of small and medium sized
driver ICs, those for automotive applications, where Himax has a
leading market share, will continue to show strong growth as more
panels are going into vehicles. For smartphone applications, the
Company believes that the adoption of 4G network should rise in
China which will stimulate demand in 2016. Himax also believes in
technology integration such as TDDI in smartphones. Revenue
contribution from TDDI will likely take place in the second half of
2016. Non-driver products wise, 2016 will be the year for Himax to
see a bigger revenue percentage generated by LCOS and WLO product
lines as shipments to its major customers start to take off. Himax
will also tap into new territories such as IoT and machine vision
with its latest CIS and WLO product offerings as stated in the
Company’s recent press releases. Overall, 2016 will be a year of
growth for both top and bottom line.
Following a strong fourth quarter, large panel
driver ICs should continue to grow around 10% sequentially and
high-teens year over year, with China and 4K TV still the major
growth engines. Himax expects its 4K TV to double in the first
quarter sequentially and close to triple over the same period last
year.
The Company is experiencing accelerating demand
from panel manufacturers seeking IC vendors who can provide driver
IC, timing controller, Gamma OP, and PMIC as a total solution.
Meanwhile, timing controller is getting more technologically
advanced, with high end models integrating sophisticated functions
such as MEMC. This positions Himax very well in the high end 4K TV
market. As the industry migrates to 8K TVs, which is already
starting to take place in product development, Himax’s business and
technology strength and integrated product solutions will be a
significant differentiator against the competition.
The other segments in Himax’ driver business is
ICs used in small and medium-sized panels for applications
including smartphones, tablets and automotives. First quarter sales
for smartphones are likely to remain flat, despite few working days
around Chinese New Year, as Himax’s end customers, including a
newly added first-tier player, are launching new models and
replenishing inventories ahead of the holidays. Furthermore, Himax
is seeing accelerating FHD shipments and design-wins in its
pipeline, a testament to the trend that FHD is quickly becoming the
new mainstream display resolution for smartphones, replacing HD720.
Himax is also pleased to report that its shipment of AMOLED driver
IC to key Korean customer will start later this quarter,
reaffirming its technology leadership. As it is collaborating with
multiple customers both in Korea and China on AMOLED product
development, Himax believes AMOLED driver ICs will be one of the
critical future growth engines of its small panel driver IC
business, especially with quite a few new AMOLED fabs being built
in China where Himax has the most comprehensive customer
coverage.
Among driver ICs used in small and medium-sized
panels, the best-performing category has been automotives in recent
years. The Company anticipates Q1 shipment to be slightly higher
than the previous quarter, growing double digit year-over-year.
Himax expects the growth to stay robust throughout the year. With
numerous top automobile brands having been its indirect end
customers, it is well positioned to take advantage of the growing
market in 2016 and beyond.
For driver ICs used in tablets, demands remain
weak and will decline double digit in the first quarter, resulting
in a declining small and medium-sized driver IC segment in the
first quarter of around mid single digit sequentially.
For the past few years, Himax’s non-driver
business segment has been its most exciting growth segment and a
differentiator for the Company. New product development continues
to evolve and gain traction, and Himax remains positive on the
long-term growth prospect of its non-driver businesses.
The Company expects mid single digit sequential
growth in non-driver products for the first quarter. Looking ahead,
many of Himax’s non-driver products, including its CMOS image
sensor, timing controller, touch panel controller, power management
IC, ASIC service, wafer level optics and LCOS microdisplay, are set
to grow significantly in 2016 and the years ahead.
For touch panel controller product line, the
Company exited 2015 with sales flat year-over-year as the industry
shifted to on-cell and pure in-cell TDDI. Himax expects on-cell to
become the mainstream touch technology in 2016. It has also
launched force touch products, a new feature to the touch panel,
and already secured design-wins from leading smartphone makers for
their 2016 models. Himax’s on-cell sales will significantly
accelerate starting late first quarter with shipments to Chinese
and Japanese smartphone makers. Furthermore, Himax is one of the
pioneers in offering TDDI solutions for the state-of-art in-cell
panels, which have started small volume production in 2015. The
Company is in partnerships with essentially all of the panel
manufacturers in pure in-cell touch for joint technological
development and believes there is a strong market for Himax going
forward. The Company expects to see its contribution starting
2H16.
Moving on to Himax’s most exciting AR/VR related
businesses, the CES Show last month showcased the fast-growing,
multi-billion dollar AR/VR sector under development. Participants
included leading multinationals in the gaming, search, mobile,
social media, military and consumer industries. Having invested in
the technologies for over 15 years, Himax is uniquely positioned as
the provider of choice for microdisplay and related optics to
enable AR.
As some of Himax’s major customers have already
announced product launches, revenues from LCOS and WLO are expected
to double sequentially in the first quarter off a small base,
marking the beginning of mass production for some of its leading AR
device customers. While most customers don’t expect big volume for
their early generation products, the Company has been working with
many of them for future generation devices. Himax is also seeing
constant additions of new customers using its LCOS and/or WLO for a
variety of new applications. We currently have more than 30
customers using the Company’s LCOS and/or WLO for their AR devices
and optical engine designs, with the vast majority of them in the
U.S.. When adopted, the Company’s LCOS and WLO typically represent
two of the parts with the highest value in an AR product’s
bill-of-materials. As for VR applications, as mentioned in the
press release in January, Himax has had new driver IC design-wins
with two top-notch VR players in the next generation OLED panels
for their VR devices.
In addition, in a recent press release, Himax
introduced WLO laser diode collimator with integrated Diffractive
Optical Element (“DOE”). The Company believes this is the most
effective solution for 3D sensing and detection. Himax’s technology
can reduce the size of the incumbent laser projector module by a
factor of 9, actually making it smaller than conventional camera
modules. This breakthrough allows the solution to be easily
integrated into next-generation smartphones, tablets, automobiles,
AR/VR devices, IoT devices, and consumer electronics accessories to
enable new applications in the consumer, medical, and industrial
marketplaces.
To be paired with the laser projector module
mentioned above, Himax is also developing a Near Infrared (NIR)
sensor to provide customers with a total solution. Additionally, in
January, Himax announced an ultra-low-power QVGA CMOS image sensor,
which, the Company believes is by far the lowest power CIS in the
industry with similar resolution, while offering outstanding sensor
performance and high level of feature integration. This sensor can
be in a constant state of operation, enabling “always on”,
contextually aware, computer vision capabilities such as feature
extraction, proximity sensing, gesture recognition, object tracking
and pattern identification. Likewise, it can be applied in new
applications across smartphones, tablets, AR/VR devices, IoT and
artificial intelligence. This series of smart sensors will open a
new business territory for Himax’s CIS products.
In terms of the Company’s 8MP and 13MP CMOS
image sensors with PDAF feature, the Company is catching up fast.
Himax believes it will be one of the few players capable of
providing PDAF-equipped CMOS image sensors in the very near
future.
First Quarter 2016
Guidance
The Company is providing the following financial
guidance for the first quarter of 2016:
Net Revenue: |
|
|
To be down 1%
to up 4% as compared to the fourth quarter of 2015 |
Gross Margin: |
|
|
To be around
25% as opposed to 22.9% reported in the fourth quarter of 2015 |
GAAP
EPS: |
|
|
5.5 to 7.5
cents per diluted ADS, as compared to 3.6 cents reported in the
fourth quarter of 2015 |
In providing the above earnings guidance, we have assumed a 20%
income tax rate, calculated based on exchange rate of NTD 33.45
against the USD, which is also the exchange rate as of beginning of
February 2016.
HIMAX TECHNOLOGIES FOURTH QUARTER
2015 EARNINGS CONFERENCE
CALL
DATE: |
|
|
Thursday, February 4th, 2016 |
TIME: |
|
|
U.S. 8:00 a.m.
EST |
|
|
|
Taiwan 9:00 p.m. |
DIAL IN: |
|
|
U.S. +1 (866) 444-9147 |
|
|
|
INTERNATIONAL +1 (678) 509-7569 |
CONFERENCE ID |
|
|
25019205 |
WEBCAST: |
|
|
http://edge.media-server.com/m/p/xd9h5jr4 |
A replay of the call will be available beginning two hours after
the call through 11:59 p.m. US EST on February 11, 2016 (12:59 p.m.
Taiwan time, February 12, 2016) on www.himax.com.tw and by
telephone at +1 (855) 859-2056 (US Domestic) or +1 (404) 537-3406
(International). The conference ID number is 25019205. This call is
being webcast by Nasdaq and can be accessed by clicking on this
link or Himax’s website, where the webcast can be accessed through
February 4, 2017.
About Himax Technologies,
Inc.
Himax Technologies, Inc. (HIMX) is a fabless
semiconductor solution provider dedicated to display imaging
processing technologies. Himax is a worldwide market leader in
display driver ICs and timing controllers used in TVs, laptops,
monitors, mobile phones, tablets, digital cameras, car navigation,
and many other consumer electronics devices. Additionally, Himax
designs and provides controllers for touch sensor displays, LCOS
micro-displays used in palm-size projectors and head-mounted
displays, LED driver ICs, power management ICs, scaler products for
monitors and projectors, tailor-made video processing IC solutions
and silicon IPs. The company also offers digital camera solutions,
including CMOS image sensors and wafer level optics, which are used
in a wide variety of applications such as mobile phone, tablet,
laptop, TV, PC camera, automobile, security and medical devices.
Founded in 2001 and headquartered in Tainan, Taiwan, Himax
currently employs around 1,900 people from three Taiwan-based
offices in Tainan, Hsinchu and Taipei and country offices in China,
Korea, Japan and the US. Himax has 2,764 patents granted and 566
patents pending approval worldwide as of December 31, 2015. Himax
has retained its position as the leading display imaging processing
semiconductor solution provider to consumer electronics brands
worldwide. http://www.himax.com.tw
Forward Looking Statements
Factors that could cause actual events or
results to differ materially include, but not limited to, General
business and economic conditions and the state of the semiconductor
industry; market acceptance and competitiveness of the driver and
non-driver products developed by the Company; demand for end-use
applications products; reliance on a small group of principal
customers; the uncertainty of continued success in technological
innovations; our ability to develop and protect our intellectual
property; pricing pressures including declines in average selling
prices; changes in customer order patterns; changes in estimated
full-year effective tax rate; shortages in supply of key
components; changes in environmental laws and regulations; exchange
rate fluctuations; regulatory approvals for further investments in
our subsidiaries; our ability to collect accounts receivable and
manage inventory and other risks described from time to time in the
Company's SEC filings, including those risks identified in the
section entitled "Risk Factors" in its Form 20-F for the year ended
December 31, 2014 filed with the SEC, as may be amended.
– FINANCIAL TABLES –
Himax Technologies, Inc. |
Unaudited Condensed Consolidated Statements of
Income |
(These interim financials do not fully comply with US
GAAP because they omit all interim disclosure required by US
GAAP) |
(Amounts in Thousands of U.S. Dollars, Except
Share and Per Share Data) |
|
|
Three Months Ended December
31, |
|
Three Months Ended September
30, |
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
|
|
|
|
Revenues |
$ |
177,977 |
|
|
$ |
227,179 |
|
|
$ |
165,582 |
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
Cost of revenues |
|
137,243 |
|
|
|
171,140 |
|
|
|
129,510 |
|
Research and development |
|
22,575 |
|
|
|
22,788 |
|
|
|
27,907 |
|
General and administrative |
|
4,544 |
|
|
|
4,901 |
|
|
|
5,158 |
|
Sales and marketing |
|
5,004 |
|
|
|
5,714 |
|
|
|
5,468 |
|
Total costs and
expenses |
|
169,366 |
|
|
|
204,543 |
|
|
|
168,043 |
|
|
|
|
|
|
|
Operating income (loss) |
|
8,611 |
|
|
|
22,636 |
|
|
|
(2,461 |
) |
|
|
|
|
|
|
Non operating income: |
|
|
|
|
|
Interest income |
|
188 |
|
|
|
225 |
|
|
|
116 |
|
Gains
(losses) on sale of securities, net |
|
159 |
|
|
|
(26 |
) |
|
|
32 |
|
Equity in income (losses) of equity method investees |
|
262 |
|
|
|
(24 |
) |
|
|
(119 |
) |
Valuation gain on financial instruments |
|
- |
|
|
|
1,255 |
|
|
|
- |
|
Impairment loss on investments |
|
- |
|
|
|
(309 |
) |
|
|
- |
|
Foreign currency exchange gains (losses), net |
|
(28 |
) |
|
|
759 |
|
|
|
680 |
|
Interest expense |
|
(141 |
) |
|
|
(149 |
) |
|
|
(152 |
) |
Other
income (losses), net |
|
(77 |
) |
|
|
18 |
|
|
|
125 |
|
|
|
363 |
|
|
|
1,749 |
|
|
|
682 |
|
Earnings (loss) before
income taxes |
|
8,974 |
|
|
|
24,385 |
|
|
|
(1,779 |
) |
Income tax expense |
|
3,759 |
|
|
|
9,247 |
|
|
|
1,151 |
|
Net income (loss) |
|
5,215 |
|
|
|
15,138 |
|
|
|
(2,930 |
) |
Net loss
attributable to noncontrolling interests |
|
915 |
|
|
|
487 |
|
|
|
598 |
|
Net income (loss)
attributable to Himax stockholders |
$ |
6,130 |
|
|
$ |
15,625 |
|
|
$ |
(2,332 |
) |
|
|
|
|
|
|
Basic earnings
(loss) per ADS attributable to Himax
stockholders |
$ |
0.036 |
|
|
$ |
0.091 |
|
|
$ |
(0.014 |
) |
Diluted
earnings (loss) per ADS
attributable to Himax stockholders |
$ |
0.036 |
|
|
$ |
0.091 |
|
|
$ |
(0.014 |
) |
|
|
|
|
|
|
Basic Weighted Average Outstanding ADS |
|
172,303 |
|
|
|
171,608 |
|
|
|
171,615 |
|
Diluted Weighted Average Outstanding
ADS |
|
172,303 |
|
|
|
172,161 |
|
|
|
171,936 |
|
Himax Technologies, Inc. |
Unaudited Condensed Consolidated Statements of
Income |
(Amounts in Thousands of U.S. Dollars, Except
Share and Per Share Data) |
|
|
|
Twelve Months Ended
December
31, |
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
|
|
|
Revenues |
|
|
$ |
691,789 |
|
|
$ |
840,542 |
|
|
|
|
|
|
|
Costs and
expenses: |
|
|
|
|
|
Cost of revenues |
|
|
|
528,651 |
|
|
|
634,660 |
|
Research and development |
|
|
|
94,422 |
|
|
|
91,839 |
|
General and administrative |
|
|
|
18,470 |
|
|
|
20,192 |
|
Sales and marketing |
|
|
|
19,574 |
|
|
|
21,126 |
|
Total costs and
expenses |
|
|
|
661,117 |
|
|
|
767,817 |
|
|
|
|
|
|
|
Operating
income |
|
|
|
30,672 |
|
|
|
72,725 |
|
|
|
|
|
|
|
Non
operating income: |
|
|
|
|
|
Interest income |
|
|
|
710 |
|
|
|
728 |
|
Gains on sale of
securities, net |
|
|
|
1,993 |
|
|
|
10,471 |
|
Valuation gain on
financial instruments |
|
|
|
- |
|
|
|
1,255 |
|
Impairment loss on
investments |
|
|
|
- |
|
|
|
(309 |
) |
Equity in losses of equity
method investees |
|
|
|
(77 |
) |
|
|
(80 |
) |
Foreign currency exchange
gains (losses), net |
|
|
|
(43 |
) |
|
|
1,077 |
|
Interest expense |
|
|
|
(514 |
) |
|
|
(518 |
) |
Other income, net |
|
|
|
126 |
|
|
|
145 |
|
|
|
|
|
2,195 |
|
|
|
12,769 |
|
Earnings
before income taxes |
|
|
|
32,867 |
|
|
|
85,494 |
|
Income tax expense |
|
|
|
11,405 |
|
|
|
21,591 |
|
Net
income |
|
|
|
21,462 |
|
|
|
63,903 |
|
Net loss
attributable to noncontrolling interests |
|
|
|
3,733 |
|
|
|
2,695 |
|
Net
income attributable to Himax
stockholders |
|
|
$ |
25,195 |
|
|
$ |
66,598 |
|
|
|
|
|
|
|
Basic earnings per
ADS attributable to Himax stockholders |
|
|
$ |
0.147 |
|
|
$ |
0.389 |
|
Diluted earnings
per ADS attributable to Himax stockholders |
|
|
$ |
0.146 |
|
|
$ |
0.387 |
|
|
|
|
|
|
|
Basic Weighted Average Outstanding ADS |
|
|
|
171,785 |
|
|
|
171,095 |
|
Diluted Weighted Average Outstanding
ADS |
|
|
|
172,066 |
|
|
|
171,999 |
|
Himax Technologies,
Inc.Unaudited Supplemental Financial
Information(Amounts in Thousands of U.S.
Dollars) |
|
|
|
|
|
The amount of
share-based compensation included in applicable
statements of income categories is
summarized as follows: |
|
Three MonthsEnded December
31, |
|
Three MonthsEnded September 30, |
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
Share-based
compensation |
|
|
|
|
|
|
Cost of revenues |
|
$ |
27 |
|
|
$ |
6 |
|
|
$ |
70 |
|
Research and development |
|
|
160 |
|
|
|
312 |
|
|
|
3,505 |
|
General and administrative |
|
|
70 |
|
|
|
132 |
|
|
|
530 |
|
Sales and marketing |
|
|
20 |
|
|
|
84 |
|
|
|
823 |
|
Income tax benefit |
|
|
(47 |
) |
|
|
(127 |
) |
|
|
(1,040 |
) |
Total |
|
$ |
230 |
|
|
$ |
407 |
|
|
$ |
3,888 |
|
|
|
|
|
|
|
|
The amount
of acquisition-related charges
included in applicable statements of
income categories is summarized as
follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
charges |
|
|
|
|
|
|
Research and development |
|
$ |
237 |
|
|
$ |
194 |
|
|
$ |
220 |
|
Income tax benefit |
|
|
(98 |
) |
|
|
|
|
(83 |
) |
|
|
(94 |
) |
Total |
|
$ |
139 |
|
|
$ |
111 |
|
|
$ |
126 |
|
Himax Technologies,
Inc.Unaudited Supplemental Financial
Information(Amounts in Thousands of U.S.
Dollars) |
|
|
|
The amount of
share-based compensation included in applicable
statements of income categories is
summarized as follows: |
|
Twelve Months Ended
December
31, |
|
|
|
2015 |
|
|
|
2014 |
|
Share-based
compensation |
|
|
|
|
Cost of revenues |
|
$ |
110 |
|
|
$ |
121 |
|
Research and development |
|
|
4,289 |
|
|
|
7,610 |
|
General and administrative |
|
|
865 |
|
|
|
1,688 |
|
Sales and marketing |
|
|
1,010 |
|
|
|
1,847 |
|
Income tax benefit |
|
|
(1,342 |
) |
|
|
(2,437 |
) |
Total |
|
$ |
4,932 |
|
|
$ |
8,829 |
|
|
|
|
|
|
The amount
of acquisition-related charges
included in applicable statements of
income categories is summarized as
follows: |
|
|
|
|
|
|
|
|
|
Acquisition-related
charges |
|
|
|
|
Research and development |
|
$ |
845 |
|
|
$ |
850 |
|
Sales and marketing |
|
|
- |
|
|
|
|
|
96 |
|
Income tax benefit |
|
|
(358 |
) |
|
|
|
|
(374 |
) |
Total |
|
$ |
487 |
|
|
$ |
572 |
|
Himax Technologies, Inc. |
GAAP Unaudited Condensed
Consolidated Balance Sheets |
(Amounts in Thousands of U.S. Dollars,
Except Share and Per Share
Data) |
|
|
December
31, 2015 |
|
September
30, 2015 |
|
December
31, 2014 |
Assets |
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
129,829 |
|
|
$ |
106,387 |
|
|
$ |
185,466 |
|
Restricted cash and marketable
securities |
|
|
180,442 |
|
|
|
180,442 |
|
|
|
130,179 |
|
Investments in marketable
securities available-for-sale |
|
|
18,511 |
|
|
|
19,625 |
|
|
|
2,377 |
|
Accounts receivable, less allowance
for doubtful accounts, sales returns and discounts |
|
|
177,198 |
|
|
|
167,975 |
|
|
|
219,368 |
|
Inventories |
|
|
171,374 |
|
|
|
177,694 |
|
|
|
166,105 |
|
Deferred income taxes |
|
|
3,306 |
|
|
|
4,216 |
|
|
|
7,740 |
|
Prepaid expenses and other current
assets |
|
|
17,175 |
|
|
|
23,520 |
|
|
|
18,341 |
|
Total current
assets |
|
|
697,835 |
|
|
|
679,859 |
|
|
|
729,576 |
|
Investment in non-marketable
equity securities |
|
|
11,211 |
|
|
|
11,211 |
|
|
|
11,211 |
|
Equity method
investments |
|
|
3,648 |
|
|
|
3,392 |
|
|
|
102 |
|
Property, plant and
equipment, net |
|
|
54,461 |
|
|
|
55,700 |
|
|
|
57,271 |
|
Deferred income
taxes |
|
|
871 |
|
|
|
1,492 |
|
|
|
477 |
|
Goodwill |
|
|
28,138 |
|
|
|
28,138 |
|
|
|
28,138 |
|
Other
intangible assets, net |
|
|
4,161 |
|
|
|
3,668 |
|
|
|
4,281 |
|
Other
assets |
|
|
2,012 |
|
|
|
2,142 |
|
|
|
1,938 |
|
|
|
|
104,502 |
|
|
|
105,743 |
|
|
|
103,418 |
|
Total assets |
|
$ |
802,337 |
|
|
$ |
785,602 |
|
|
$ |
832,994 |
|
Liabilities, Redeemable
noncontrolling interest and
Equity |
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
Short-term debt |
|
$ |
180,000 |
|
|
$ |
180,000 |
|
|
$ |
130,000 |
|
Accounts payable |
|
|
124,423 |
|
|
|
111,996 |
|
|
|
179,328 |
|
Income taxes payable |
|
|
12,139 |
|
|
|
13,517 |
|
|
|
19,050 |
|
Deferred income taxes |
|
|
138 |
|
|
|
34 |
|
|
|
35 |
|
Other accrued expenses and other
current liabilities |
|
|
36,030 |
|
|
|
35,781 |
|
|
|
26,992 |
|
Total current
liabilities |
|
|
352,730 |
|
|
|
341,328 |
|
|
|
355,405 |
|
Other
liabilities |
|
|
4,610 |
|
|
|
4,407 |
|
|
|
5,636 |
|
Total
liabilities |
|
|
357,340 |
|
|
|
345,735 |
|
|
|
361,041 |
|
Redeemable
noncontrolling interest |
|
|
3,656 |
|
|
|
3,656 |
|
|
|
3,656 |
|
Equity |
|
|
|
|
|
|
Himax
stockholders’ equity: |
|
|
|
|
|
|
Ordinary shares, US$0.3
par value, 1,000,000,000 shares authorized; 356,699,482 shares
issued and 343,815,424 shares, 343,815,424 shares and 342,425,144
shares outstanding at December 31, 2015, September 30, 2015 and
December 31, 2014, respectively |
|
107,010 |
|
|
|
107,010 |
|
|
|
107,010 |
|
Additional paid-in capital |
|
|
105,355 |
|
|
|
|
|
107,238 |
|
|
|
107,808 |
|
Treasury shares, at cost,
12,884,058 shares, 12,884,058 shares and 14,274,338 shares at
December 31, 2015, September 30, 2015 and December 31, 2014,
respectively |
|
|
(9,157 |
) |
|
|
|
|
(9,157 |
) |
|
|
(10,144 |
) |
Accumulated other comprehensive
loss |
|
|
(1,879 |
) |
|
|
|
|
(723 |
) |
|
|
(316 |
) |
Unappropriated retained
earnings |
|
|
237,375 |
|
|
|
233,082 |
|
|
|
268,266 |
|
Himax
stockholders’ equity |
|
|
438,704 |
|
|
|
437,450 |
|
|
|
472,624 |
|
Noncontrolling
interests |
|
|
2,637 |
|
|
|
(1,239 |
) |
|
|
(4,327 |
) |
Total
equity |
|
|
441,341 |
|
|
|
436,211 |
|
|
|
468,297 |
|
Total
liabilities, redeemable
noncontrolling interest and
equity |
|
$ |
802,337 |
|
|
$ |
785,602 |
|
|
$ |
832,994 |
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in
Thousands of
U.S.
Dollars) |
|
|
Three Months Ended
December
31, |
|
Three Months Ended
September
30, |
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
|
|
|
|
|
Cash flows from
operating activities: |
|
|
|
|
|
|
Net income (loss) |
|
$ |
5,215 |
|
|
$ |
15,138 |
|
|
$ |
(2,930 |
) |
Adjustments to
reconcile net income to net cash provided by operating
activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
3,407 |
|
|
|
3,903 |
|
|
|
3,425 |
|
Bad debt expense |
|
|
310 |
|
|
|
554 |
|
|
|
--- |
|
Share-based compensation
expenses |
|
|
277 |
|
|
|
534 |
|
|
|
472 |
|
Gain on disposals of property and
equipment |
|
--- |
|
|
(2 |
) |
|
|
(2 |
) |
Losses (gains) on disposals of
marketable securities, net |
|
|
(159 |
) |
|
|
26 |
|
|
|
(32 |
) |
Impairment loss on investment |
|
--- |
|
|
309 |
|
|
|
--- |
|
Equity in losses (gains) of equity
method investees |
|
|
(262 |
) |
|
|
24 |
|
|
|
119 |
|
Valuation gain on financial
liabilities |
|
--- |
|
|
(1,255 |
) |
|
|
--- |
|
Deferred income tax expense
(benefit) |
|
|
1,665 |
|
|
|
2,710 |
|
|
|
(85 |
) |
Inventories write downs |
|
|
2,445 |
|
|
|
2,892 |
|
|
|
2,078 |
|
Changes in operating
assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
|
(9,583 |
) |
|
|
(1,149 |
) |
|
|
14,181 |
|
Inventories |
|
|
3,875 |
|
|
|
(11,858 |
) |
|
|
9,800 |
|
Prepaid expenses and other current
assets |
|
|
8,977 |
|
|
|
573 |
|
|
|
(5,533 |
) |
Accounts payable |
|
|
12,427 |
|
|
|
23,375 |
|
|
|
(13,775 |
) |
Income taxes payable |
|
|
(749 |
) |
|
|
3,092 |
|
|
|
(425 |
) |
Other accrued expenses and other
current liabilities |
|
|
(1,594 |
) |
|
|
(184 |
) |
|
|
6,850 |
|
Other liabilities |
|
|
(385 |
) |
|
|
(2 |
) |
|
|
--- |
|
Net cash
provided by operating
activities |
|
|
25,866 |
|
|
|
38,680 |
|
|
|
14,143 |
|
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
|
Purchases of property, plant and
equipment |
|
|
(3,567 |
) |
|
|
(2,383 |
) |
|
|
(2,554 |
) |
Proceeds from disposal of property
and equipment |
|
--- |
|
--- |
|
|
2 |
|
Purchases of available-for-sale
marketable securities |
|
|
(16,498 |
) |
|
|
(6,252 |
) |
|
|
(33,328 |
) |
Proceeds from disposals of
available-for-sale marketable securities |
|
|
17,520 |
|
|
|
6,851 |
|
|
|
16,757 |
|
Proceeds from capital reduction of
investments |
|
--- |
|
|
1,168 |
|
|
|
--- |
|
Proceeds from (repayments of)
refundable deposits, net |
|
|
13 |
|
|
|
|
|
(31 |
) |
|
|
(204 |
) |
Releases (pledges) of restricted
marketable securities |
|
--- |
|
|
2,887 |
|
|
|
(131 |
) |
Cash increase resulting from change
in consolidated entity |
|
|
341 |
|
|
--- |
|
|
--- |
|
Net cash
provided by (used in)
investing activities |
|
|
(2,191 |
) |
|
|
|
|
2,240 |
|
|
|
(19,458 |
) |
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in
Thousands of
U.S.
Dollars) |
|
|
Three Months Ended December
31, |
|
Three Months Ended September
30, |
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
Cash flows from
financing activities: |
|
|
|
|
|
|
Payments of cash dividends |
|
--- |
|
--- |
|
|
(51,364 |
) |
Excess tax benefits from
share-based compensation |
|
--- |
|
--- |
|
|
771 |
|
Proceeds from disposals of
subsidiary shares to noncontrolling interests by Himax Imaging,
Inc. |
|
|
4 |
|
|
|
18 |
|
|
|
8 |
|
Purchases of subsidiary shares from
noncontrolling interests |
|
|
(145 |
) |
|
|
(46 |
) |
|
|
(305 |
) |
Releases (pledges) of restricted
cash, cash equivalents and marketable securities (for borrowing of
short-term debt) |
|
--- |
|
|
7,500 |
|
|
|
(50,000 |
) |
Proceeds from issuance of new
shares by subsidiaries |
|
--- |
|
--- |
|
|
1,466 |
|
Proceeds from short-term debt |
|
|
92,303 |
|
|
|
136,000 |
|
|
|
130,000 |
|
Repayments of short-term debt |
|
|
(92,303 |
) |
|
|
(143,500 |
) |
|
|
|
|
(80,000 |
) |
Net cash
used in financing activities |
|
|
(141 |
) |
|
|
(28 |
) |
|
|
(49,424 |
) |
Effect
of foreign currency exchange rate
changes on cash and cash equivalents |
|
|
(92 |
) |
|
|
(3 |
) |
|
|
(130 |
) |
Net
increase
(decrease) in
cash and cash equivalents |
|
|
23,442 |
|
|
|
40,889 |
|
|
|
(54,869 |
) |
Cash and cash
equivalents at beginning of period |
|
|
106,387 |
|
|
|
144,577 |
|
|
|
161,256 |
|
Cash and cash
equivalents at end of period |
|
$ |
129,829 |
|
|
$ |
185,466 |
|
|
$ |
106,387 |
|
|
|
|
|
|
|
|
Supplemental
disclosures of cash flow information: |
|
|
|
|
|
|
Cash paid during the period
for: |
|
|
|
|
|
|
Interest expense |
|
$ |
79 |
|
|
$ |
223 |
|
|
$ |
215 |
|
Income taxes |
|
$ |
350 |
|
|
$ |
84 |
|
|
$ |
2,479 |
|
|
|
|
|
|
|
|
Supplemental
disclosures of investing activities affecting both
cash and non-cash items: |
|
|
|
|
|
|
Purchases of property, plant and
equipment |
|
$ |
1,948 |
|
|
$ |
2,645 |
|
|
$ |
4,708 |
|
Decrease (increase) in payable for
purchases of equipment and asset retirement obligations |
|
|
1,619 |
|
|
|
(262 |
) |
|
|
|
|
(2,154 |
) |
Cash paid |
|
$ |
3,567 |
|
|
$ |
2,383 |
|
|
$ |
2,554 |
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in
Thousands of
U.S.
Dollars) |
|
|
|
|
Twelve Months Ended
December
31, |
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
|
|
|
|
Cash flows from
operating activities: |
|
|
|
|
|
|
Net income |
|
|
|
$ |
21,462 |
|
|
$ |
63,903 |
|
Adjustments to
reconcile net income to net cash provided by operating
activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
|
|
14,164 |
|
|
|
14,592 |
|
Bad debt expense |
|
|
|
|
310 |
|
|
|
554 |
|
Share-based compensation
expenses |
|
|
|
|
1,818 |
|
|
|
1,929 |
|
Gain on disposals of property and
equipment |
|
|
|
|
(2 |
) |
|
|
(2 |
) |
Gain on disposal of investment
securities, net |
|
|
|
|
(1,770 |
) |
|
|
(10,502 |
) |
Losses (gains) on disposal of
marketable securities, net |
|
|
|
|
(223 |
) |
|
|
31 |
|
Impairment loss on investment |
|
|
|
--- |
|
|
309 |
|
Equity in losses of equity method
investees |
|
|
|
|
77 |
|
|
|
80 |
|
Valuation gain on financial
liabilities |
|
|
|
--- |
|
|
(1,255 |
) |
Deferred income tax expense |
|
|
|
|
4,148 |
|
|
|
3,816 |
|
Inventories write downs |
|
|
|
|
9,785 |
|
|
|
8,198 |
|
Changes in operating
assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
|
|
|
41,656 |
|
|
|
(19,211 |
) |
Inventories |
|
|
|
|
(15,054 |
) |
|
|
3,096 |
|
Prepaid expenses and other current
assets |
|
|
|
|
2,067 |
|
|
|
1,053 |
|
Accounts payable |
|
|
|
|
(54,905 |
) |
|
|
28,038 |
|
Income taxes payable |
|
|
|
|
(6,475 |
) |
|
|
2,357 |
|
Other accrued expenses and other
current liabilities |
|
|
|
|
5,987 |
|
|
|
(3,262 |
) |
Other liabilities |
|
|
|
|
(516 |
) |
|
|
(5 |
) |
Net cash
provided by operating
activities |
|
|
|
|
22,529 |
|
|
|
93,719 |
|
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
|
Purchases of property, plant and
equipment |
|
|
|
|
(9,982 |
) |
|
|
(10,931 |
) |
Proceeds from disposal of property
and equipment |
|
|
|
|
8 |
|
|
|
1 |
|
Purchases of available-for-sale
marketable securities |
|
|
|
|
(63,051 |
) |
|
|
(23,766 |
) |
Proceeds from disposals of
available-for-sale marketable securities |
|
|
|
|
46,720 |
|
|
|
22,021 |
|
Purchases of equity method
investment |
|
|
|
|
(3,708 |
) |
|
--- |
Proceeds from disposals
of equity method investment |
|
|
|
179 |
|
|
--- |
Proceeds from disposals
of investment securities |
|
|
|
1,682 |
|
|
|
19,691 |
|
Proceeds from capital
reduction of investments |
|
|
--- |
|
|
1,168 |
|
Repayments of
refundable deposits, net |
|
|
|
(304 |
) |
|
|
|
|
(237 |
) |
Releases (pledges) of
restricted marketable securities |
|
|
|
(227 |
) |
|
|
2,697 |
|
Cash increase resulting from change
in consolidated entity |
|
|
|
|
341 |
|
|
--- |
Net cash
provided by (used in)
investing activities |
|
|
|
|
(28,342 |
) |
|
|
|
|
10,644 |
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in
Thousands of
U.S.
Dollars) |
|
|
|
|
Twelve Months Ended
December
31, |
|
|
|
|
|
2015 |
|
|
|
2014 |
|
Cash flows from
financing activities: |
|
|
|
|
|
|
Payments of cash dividends |
|
|
|
|
(51,364 |
) |
|
|
(46,042 |
) |
Excess tax benefits from
share-based compensation |
|
|
|
|
771 |
|
|
|
1,232 |
|
Proceeds from disposals of
subsidiary shares to noncontrolling interests by Himax Technologies
Limited |
|
|
|
--- |
|
|
83 |
|
Proceeds from disposals of
subsidiary shares to noncontrolling interests by Himax Imaging,
Inc. |
|
|
|
|
22 |
|
|
|
38 |
|
Purchases of subsidiary shares from
noncontrolling interests |
|
|
|
|
(503 |
) |
|
|
(1,515 |
) |
Pledges of restricted cash, cash
equivalents and marketable securities (for borrowing of short-term
debt) |
|
|
|
|
(50,000 |
) |
|
|
(24,500 |
) |
Proceeds from issuance of new
shares by subsidiaries |
|
|
|
|
1,466 |
|
|
--- |
Proceeds from short-term debt |
|
|
|
|
412,303 |
|
|
|
417,500 |
|
Repayments of short-term debt |
|
|
|
|
(362,303 |
) |
|
|
(393,000 |
) |
Net cash
used in financing activities |
|
|
|
|
(49,608 |
) |
|
|
(46,204 |
) |
Effect
of foreign currency exchange rate
changes on cash and cash equivalents |
|
|
|
|
(216 |
) |
|
|
(13 |
) |
Net
increase (decrease) in
cash and cash equivalents |
|
|
|
|
(55,637 |
) |
|
|
58,146 |
|
Cash and cash
equivalents at beginning of period |
|
|
|
|
185,466 |
|
|
|
127,320 |
|
Cash and cash
equivalents at end of period |
|
|
|
$ |
129,829 |
|
|
$ |
185,466 |
|
|
|
|
|
|
|
|
Supplemental
disclosures of cash flow information: |
|
|
|
|
|
|
Cash paid during the period
for: |
|
|
|
|
|
|
Interest expense |
|
|
|
$ |
516 |
|
|
$ |
592 |
|
Income taxes |
|
|
|
$ |
12,505 |
|
|
$ |
13,311 |
|
|
|
|
|
|
|
|
Supplemental
disclosures of investing activities affecting both
cash and non-cash items: |
|
|
|
|
|
|
Purchases of property, plant and
equipment |
|
|
|
$ |
10,567 |
|
|
$ |
10,385 |
|
Decrease (increase) in payable for
purchases of equipment and asset retirement obligations |
|
|
|
|
(585 |
) |
|
|
546 |
|
Cash paid |
|
|
|
$ |
9,982 |
|
|
$ |
10,931 |
|
Himax Technologies, Inc. |
Non-GAAP Unaudited Supplemental Data –
Reconciliation Schedule |
(Amounts in Thousands of U.S.
Dollars) |
|
Gross Margin, Operating Margin and Net Margin Excluding
Share-based Compensation and Acquisition-Related
Charges: |
|
Three Months Ended December
31, |
|
Three Months Ended September
30, |
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
Revenues |
$ |
177,977 |
|
|
$ |
227,179 |
|
|
$ |
165,582 |
|
|
|
|
|
|
|
Gross profit |
|
40,734 |
|
|
|
56,039 |
|
|
|
36,072 |
|
Add: Share-based
compensation – Cost of revenues |
|
27 |
|
|
|
6 |
|
|
|
70 |
|
Gross profit excluding
share-based compensation |
|
40,761 |
|
|
|
56,045 |
|
|
|
36,142 |
|
Gross margin excluding
share-based compensation |
|
22.9 |
% |
|
|
24.7 |
% |
|
|
21.8 |
% |
|
|
|
|
|
|
Operating income
(loss) |
|
8,611 |
|
|
|
22,636 |
|
|
|
(2,461 |
) |
Add: Share-based
compensation |
|
277 |
|
|
|
534 |
|
|
|
4,928 |
|
Operating income
excluding share-based compensation |
|
8,888 |
|
|
|
23,170 |
|
|
|
2,467 |
|
Add:
Acquisition-related charges –Intangible assets amortization |
|
237 |
|
|
|
194 |
|
|
|
220 |
|
Operating income
excluding share-based compensation and acquisition-related
charges |
|
9,125 |
|
|
|
23,364 |
|
|
|
2,687 |
|
Operating margin
excluding share-based compensation and acquisition-related
charges |
|
5.1 |
% |
|
|
10.3 |
% |
|
|
1.6 |
% |
Net income (loss)
attributable to Himax stockholders |
|
6,130 |
|
|
|
15,625 |
|
|
|
(2,332 |
) |
Add: Share-based
compensation, net of tax |
|
230 |
|
|
|
407 |
|
|
|
3,888 |
|
Add:
Acquisition-related charges, net of tax |
|
139 |
|
|
|
111 |
|
|
|
126 |
|
Net income attributable
to Himax stockholders excluding share-based compensation and
acquisition-related charges |
|
6,499 |
|
|
|
16,143 |
|
|
|
1,682 |
|
Net margin attributable
to Himax stockholders excluding share-based compensation and
acquisition-related charges |
|
3.7 |
% |
|
|
7.1 |
% |
|
|
1.0 |
% |
|
|
|
|
|
|
*Gross
margin excluding share-based compensation equals gross profit
excluding share-based compensation divided by revenues |
*Operating
margin excluding share-based compensation and acquisition-related
charges equals operating income excluding share-based compensation
and acquisition-related charges divided by revenues |
*Net
margin attributable to Himax stockholders excluding share-based
compensation and acquisition-related charges equals net income
attributable to Himax stockholders excluding share-based
compensation and acquisition-related charges divided by
revenues |
Himax Technologies, Inc. |
Non-GAAP Unaudited Supplemental Data –
Reconciliation Schedule |
(Amounts in Thousands of U.S.
Dollars) |
|
Gross Margin, Operating Margin and Net Margin Excluding
Share-based Compensation and Acquisition-Related
Charges: |
|
|
|
Twelve Months Ended
December
31, |
|
|
|
|
2015 |
|
|
|
2014 |
|
Revenues |
|
|
$ |
691,789 |
|
|
$ |
840,542 |
|
|
|
|
|
|
|
Gross profit |
|
|
|
163,138 |
|
|
|
205,882 |
|
Add: Share-based
compensation – Cost of revenues |
|
|
|
110 |
|
|
|
121 |
|
Gross profit excluding
share-based compensation |
|
|
|
163,248 |
|
|
|
206,003 |
|
Gross margin excluding
share-based compensation |
|
|
|
23.6 |
% |
|
|
24.5 |
% |
|
|
|
|
|
|
Operating income |
|
|
|
30,672 |
|
|
|
72,725 |
|
Add: Share-based
compensation |
|
|
|
6,274 |
|
|
|
11,266 |
|
Operating income
excluding share-based compensation |
|
|
|
36,946 |
|
|
|
83,991 |
|
Add:
Acquisition-related charges –Intangible assets amortization |
|
|
|
845 |
|
|
|
946 |
|
Operating income
excluding share-based compensation and acquisition-related
charges |
|
|
|
37,791 |
|
|
|
84,937 |
|
Operating margin
excluding share-based compensation and acquisition-related
charges |
|
|
|
5.5 |
% |
|
|
10.1 |
% |
Net income attributable
to Himax stockholders |
|
|
|
25,195 |
|
|
|
66,598 |
|
Add: Share-based
compensation, net of tax |
|
|
|
4,932 |
|
|
|
8,829 |
|
Add:
Acquisition-related charges, net of tax |
|
|
|
487 |
|
|
|
572 |
|
Net income attributable
to Himax stockholders excluding share-based compensation and
acquisition-related charges |
|
|
|
30,614 |
|
|
|
75,999 |
|
Net margin attributable
to Himax stockholders excluding share-based compensation and
acquisition-related charges |
|
|
|
4.4 |
% |
|
|
9.0 |
% |
|
|
|
|
|
|
*Gross
margin excluding share-based compensation equals gross profit
excluding share-based compensation divided by revenues |
*Operating
margin excluding share-based compensation and acquisition-related
charges equals operating income excluding share-based compensation
and acquisition-related charges divided by revenues |
*Net
margin attributable to Himax stockholders excluding share-based
compensation and acquisition-related charges equals net income
attributable to Himax stockholders excluding share-based
compensation and acquisition-related charges divided by
revenues |
Diluted Earnings Per ADS Attributable to Himax stockholders
Excluding Share-based Compensation and Acquisition-Related Charges:
(Amounts in U.S. Dollars) |
|
|
Three Months Ended December
31, |
|
Twelve Months Ended
December
31, |
|
|
2015 |
|
|
|
2015 |
|
Diluted GAAP earnings per ADS
attributable to Himax stockholders |
$ |
0.036 |
|
|
$ |
0.146 |
|
Add: Share-based compensation per
ADS |
$ |
0.001 |
|
|
$ |
0.029 |
|
Add: Acquisition-related charges
per ADS |
$ |
0.001 |
|
|
$ |
0.003 |
|
|
|
|
|
Diluted non-GAAP earnings per ADS
attributable to Himax stockholders excluding share-based
compensation and acquisition-related charges |
$ |
0.038 |
|
|
$ |
0.178 |
|
|
|
|
|
Numbers do
not add up due to rounding |
|
Company Contacts:
Jackie Chang, CFO
Himax Technologies, Inc.
Tel: +886-2-2370-3999 Ext.22300
Or
US Tel: +1-949-585-9838 Ext.252
Fax: +886-2-2314-0877
Email: jackie_chang@himax.com.tw
www.himax.com.tw
Nadiya Chen, Investor Relations
Himax Technologies, Inc.
Tel: +886-2-2370-3999 Ext. 22513
Fax: +886-2-2314-0877
Email: nadiya_chen@himax.com.tw
www.himax.com.tw
Penny Lin, Investor Relations
Himax Technologies, Inc.
Tel: +886-2-2370-3999 Ext.22320
Fax: +886-2-2314-0877
Email: penny_lin@himax.com.tw
www.himax.com.tw
Investor Relations - US Representative
John Mattio, Founder
Lamnia International, LLC.
Tel: +1 (203) 885 -1099
Direct: +1 (203) 885 -1058
Email: jmattio@lamniaintl.com
www.lamniaintl.com
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