SANTA CLARA,
Calif., Dec. 3, 2015 /PRNewswire/
-- OmniVision Technologies, Inc. (Nasdaq: OVTI), a leading
developer of advanced digital imaging solutions, today reported
financial results for the second quarter of fiscal 2016 that ended
on October 31, 2015.
Revenues for the second quarter of fiscal 2016 were
$343.1 million, as compared to
$329.9 million in the first
quarter of fiscal 2016, and $394.0 million in the second quarter of
fiscal 2015. GAAP net income in the second quarter of
fiscal 2016 was $13.9 million, or $0.23 per diluted share, as compared to net
income of $18.2 million, or
$0.31 per diluted share in the
first quarter of fiscal 2016, and $28.0 million, or $0.47 per diluted share in the second
quarter of fiscal 2015.
Non-GAAP net income in the second quarter of fiscal 2016
was $22.7 million, or
$0.37 per diluted share.
Non-GAAP net income in the first quarter of fiscal 2016 was
$28.6 million, or $0.46 per diluted share. Non-GAAP net income
in the second quarter of fiscal 2015 was $36.9 million, or $0.60 per diluted share. Non-GAAP net income
excludes stock-based compensation expenses and the related tax
effects. Please refer to the attached schedule for a reconciliation
of GAAP net income to non-GAAP net income for the three and six
months ended October 31, 2015 and 2014 and for the three
months ended July 31, 2015.
GAAP gross margin for the second quarter of fiscal 2016 was
21.9%, as compared to 22.6% for the first quarter of
fiscal 2016 and 22.0% for the second quarter of
fiscal 2015. The sequential decrease in second quarter gross
margin was attributable to broad-based price erosions, particularly
in the mobile phone market.
The Company ended the period with cash, cash equivalents and
short-term investments totaling $613.5 million, an increase of $19.7 million from the previous quarter.
"We are very pleased with our second quarter results. We have
exceeded our own expectations, despite demand uncertainties in our
various target markets," said Shaw Hong, chief executive officer of
OmniVision Technologies, Inc. "Regardless of these short-term
uncertainties, we will continue to invest in the future of our
business, and ultimately, return to our long-term growth
trajectory."
Outlook
Based on current trends, the Company expects revenues for the
third quarter of fiscal 2016 will be in the range of
$310 million to $340 million and GAAP net income per
share will be between $0.11 and
$0.26 per diluted share.
Excluding the estimated expense and related tax effects associated
with stock-based compensation, the Company expects its non-GAAP net
income per share will be between $0.24 and $0.39 per diluted share. Refer to the table
below for a reconciliation of GAAP to non-GAAP net income. These
expectations do not include any one-time effects from the sale of
the Company's investments in VisEra Holding Company and XinTec,
Inc., and the paying off of the Company's mortgage loan, in
November 2015.
Conference Call
OmniVision Technologies, Inc. will host a conference call today
at 5:00 p.m. Eastern time to discuss these results further.
This conference call can be accessed via a webcast at www.ovt.com.
The call can also be accessed by dialing
877-474-9506 (domestic) or 857-244-7559 (international)
and entering passcode 69280356.
A replay of the call will remain available at www.ovt.com for
approximately twelve months. A replay of the call will also be
available for one week beginning approximately one hour after the
conclusion of the call. To access the replay, dial
888-286-8010 (domestic) or 617-801-6888 (international)
and enter passcode 78968091.
About OmniVision
OmniVision Technologies, Inc. is a leading developer of advanced
digital imaging solutions. Its CameraChip™ and CameraCubeChip™
products are highly integrated, single-chip CMOS image sensors for
consumer and commercial applications, including mobile phones,
tablets and entertainment devices, notebooks and webcams,
commercial security and surveillance systems, digital still and
video cameras, automotive and medical imaging systems. Additional
information is available at www.ovt.com.
Safe Harbor
Statement
Certain statements in this press release, including
statements regarding continued investment in the future of our
business and our long-term growth trajectory, and statements
regarding our expectations regarding revenues and earnings per
share for the three months ending January 31, 2016 are
forward-looking statements. These forward-looking statements are
based on management's current expectations, and certain factors
could cause actual results to differ materially from those in the
forward-looking statements. These factors include, without
limitation, our ability to maintain or increase sales to current
key and new customers and end-users of our products; competition in
current and emerging markets for image sensor products, including
pricing pressures that could result from competition and
unfavorable exchange rate movements; the potential for a slowdown
in sales in the near term due to general economic conditions and
market volatility, which can reduce visibility and thus orders from
the end-user customers of our products; our ability to increase the
average selling prices or lower the costs associated with the
development and manufacture of our new, complex products and
technologies; fluctuations of wafer manufacturing costs,
manufacturing yields, manufacturing capacity and other
manufacturing processes and the impact on gross margins;
uncertainties for our customers, foundries, vendors, employees, or
others with whom we do business that may be created by our recently
announced merger agreement which uncertainties could adversely
affect our business; the continued growth and development of
current markets and the emergence of new markets in which we sell,
or may sell, our products; fluctuations in sales mix and average
selling prices; our ability to timely complete the product
development cycle for new sensors; our ability to obtain design
wins from various image sensor device manufacturers including
manufacturers of mobile phones, tablets and entertainment devices,
notebooks and webcams, commercial security and surveillance
systems, digital still and video cameras, automotive and medical
imaging systems; our dependence on third party wafer foundries and
their ability to manufacture our wafers in the required quantities,
at acceptable quality, yields and costs, and in a timely manner;
our ability to accurately forecast customer demand for our
products; the market acceptance of products into which our products
are designed; the development, production, introduction and
marketing of new products and technology; the occurrence of
litigation regarding intellectual property or indemnification
claims from our suppliers or customers relating to our intellectual
property; our strategic investments and relationships, and other
risks detailed from time to time in our Securities and Exchange
Commission filings and reports, including, but not limited to, our
most recent Annual Report on Form 10-K and recent Quarterly
Reports on Form 10-Q. We expressly disclaim any obligation to
update information contained in any forward-looking
statement.
Use of Non-GAAP Financial Information
To supplement the reader's overall understanding of both its
reported results presented in accordance with U.S. generally
accepted accounting principles ("GAAP") and its outlook, the
Company also presents non-GAAP measures of net income and net
income per share which are adjusted from results based on GAAP. In
particular, the Company excludes stock-based compensation expenses
and the related tax effects. The non-GAAP financial measures which
the Company discloses also exclude the effects of stock-based
compensation on the number of basic and diluted common shares used
in calculating non-GAAP basic and diluted net income per share. The
Company provides these non-GAAP financial measures to enhance an
investor's overall understanding of its current financial
performance and to assess its prospects for the future. These
non-GAAP financial measures reflect an additional way of viewing
aspects of the Company's operations that, when viewed with its GAAP
results and the accompanying reconciliations to the corresponding
GAAP financial measures, provide a more complete understanding of
factors and trends affecting the Company's business. The economic
basis for the Company's decision to use non-GAAP financial measures
is that the adjustments to net income did not reflect the on-going
relative strength of the Company's performance. The Company's
objective is to minimize any confusion in the financial markets by
providing non-GAAP net income and non-GAAP net income per share
measurements and disclosing the related components. These non-GAAP
financial measures should be considered as a supplement to, and not
as a substitute for, or superior to, the financial measures
prepared in accordance with GAAP.
The Company uses non-GAAP financial measures for internal
management purposes to conduct and evaluate its business, when
publicly providing its business outlook and to facilitate
period-to-period comparisons. The Company views non-GAAP net income
per share as a primary indicator of the profitability of its
underlying business. In addition, because stock-based compensation
is a non-cash expense and is offset in full by a credit to
additional paid-in capital, it has no effect on total stockholders'
equity. As the calculation of non-GAAP financial measures differs
between companies, the non-GAAP financial measures used by the
Company may not be comparable to similarly titled measures used by
other companies. Other than stock-based compensation and the
related tax effects, these differences may cause the Company's
non-GAAP measures to not be directly comparable to other companies'
non-GAAP measures. Although these non-GAAP financial measures
adjust cost, expenses and basic and diluted share items to exclude
the accounting treatment of stock-based compensation, they should
not be viewed as a non-GAAP presentation reflecting the elimination
of the underlying stock-based compensation programs. Thus, the
Company's non-GAAP presentations are not intended to present, and
should not be used, as a basis for assessing what its operating
results might be if it were to eliminate its stock-based
compensation programs. The Company compensates for these
limitations by providing full disclosure of the net income and net
income per share on a basis prepared in accordance with GAAP to
enable investors to consider net income and net income per share
determined under GAAP as well as on an adjusted basis, and perform
their own analysis, as appropriate. As a result of the foregoing
limitations, the Company does not use, nor does the Company intend
to use, the non-GAAP financial measures when assessing the
Company's performance against that of other companies.
Estimating stock-based compensation expenses and the related tax
effects for a future period is subject to inherent risks and
uncertainties, including but not limited to the price of the
Company's stock, stock market volatility, expected option life,
risk-free interest rates, and the number of option exercises and
sales during the quarter.
OMNIVISION
TECHNOLOGIES, INC.
RECONCILIATION OF
GUIDANCE FOR GAAP NET INCOME PER DILUTED SHARE TO
PROJECTED NON-GAAP NET INCOME PER DILUTED
SHARE (unaudited)
|
|
|
|
Three Months
Ending January 31, 2016
|
|
GAAP
Range of
Estimates
|
|
Non-GAAP
Range of
Estimates
|
|
From
|
To
|
Adjustment
|
From
|
To
|
Net income per
share
|
$
0.11
|
$
0.26
|
$ 0.13(1)
|
$
0.24
|
$
0.39
|
|
|
|
|
|
|
(1) Reflects estimated
adjustment for expenses and related tax effects associated with
stock-based compensation.
|
OMNIVISION
TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS (in thousands,
except per share amounts) (unaudited)
|
|
|
|
|
October 31,
|
April 30,
|
|
2015
|
2015
|
ASSETS
|
|
|
Current
assets:
|
|
|
Cash and cash
equivalents
|
$ 409,656
|
$ 318,892
|
Short-term
investments
|
203,827
|
205,271
|
Accounts
receivable, net
|
159,698
|
151,086
|
Inventories
|
331,032
|
343,966
|
Prepaid and
deferred income taxes
|
4,020
|
7,149
|
Prepaid
expenses and other current assets
|
8,360
|
5,628
|
Recoverable
insurance proceeds
|
—
|
12,500
|
Total current assets
|
1,116,593
|
1,044,492
|
Property, plant and
equipment, net
|
142,014
|
145,214
|
Long-term
investments
|
155,846
|
192,021
|
Goodwill
|
10,227
|
10,227
|
Intangibles,
net
|
45,647
|
52,287
|
Other long-term
assets
|
28,416
|
24,155
|
Total assets
|
$
1,498,743
|
$
1,468,396
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$ 122,447
|
$ 118,796
|
Accrued
expenses and other current liabilities
|
37,878
|
37,112
|
Litigation
settlement accrual
|
—
|
12,500
|
Income taxes
payable
|
2,085
|
3,444
|
Deferred
revenues, less cost of revenues
|
39,572
|
22,621
|
Current portion
of long-term debt
|
9,216
|
7,096
|
Total current liabilities
|
211,198
|
201,569
|
Long-term
liabilities:
|
|
|
Long-term
income taxes payable
|
54,717
|
55,150
|
Non-current
portion of long-term debt
|
22,268
|
24,999
|
Other long-term
liabilities
|
16,940
|
23,898
|
Total long-term liabilities
|
93,925
|
104,047
|
Total liabilities
|
305,123
|
305,616
|
|
|
|
Stockholders'
equity:
|
|
|
Common stock, $0.001 par value; 100,000 shares authorized;
80,236 shares issued and 59,637 outstanding at
October 31, 2015 and 78,734 shares issued and
58,135 outstanding at April 30, 2015,
respectively
|
80
|
79
|
Additional paid-in capital
|
727,510
|
709,442
|
Accumulated other comprehensive income
|
20,652
|
40,069
|
Treasury stock, 20,599 shares at October 31, 2015 and
April 30, 2015, respectively
|
(278,683)
|
(278,683)
|
Retained earnings
|
724,061
|
691,873
|
Total stockholders' equity
|
1,193,620
|
1,162,780
|
Total liabilities and stockholders' equity
|
$
1,498,743
|
$
1,468,396
|
OMNIVISION TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF
INCOME (in thousands,
except per share amounts) (unaudited)
|
|
|
|
|
Three Months
Ended
|
Six Months
Ended
|
|
October 31,
|
October 31,
|
|
2015
|
2014
|
2015
|
2014
|
Revenues
|
$ 343,136
|
$ 394,045
|
$ 673,027
|
$ 800,581
|
Cost of
revenues
|
268,076
|
307,548
|
523,430
|
625,664
|
Gross
profit
|
75,060
|
86,497
|
149,597
|
174,917
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
Research,
development and related
|
35,498
|
34,186
|
71,612
|
68,918
|
Selling,
general and administrative
|
21,693
|
20,229
|
42,840
|
39,439
|
Amortization of
acquired patent portfolio
|
2,322
|
2,322
|
4,643
|
4,643
|
Total operating expenses
|
59,513
|
56,737
|
119,095
|
113,000
|
|
|
|
|
|
Income from
operations
|
15,547
|
29,760
|
30,502
|
61,917
|
Equity in earnings of
investee
|
516
|
1,034
|
889
|
1,969
|
Interest expense,
net
|
(183)
|
(397)
|
(416)
|
(852)
|
Other income,
net
|
804
|
219
|
1,913
|
1,264
|
Income before income
taxes
|
16,684
|
30,616
|
32,888
|
64,298
|
|
|
|
|
|
Provision for (benefit
from) income taxes
|
2,738
|
2,572
|
700
|
(9,073)
|
Net income
|
$
13,946
|
$
28,044
|
$
32,188
|
$
73,371
|
|
|
|
|
|
Net income per
share:
|
|
|
|
|
Basic
|
$
0.23
|
$
0.49
|
$
0.54
|
$
1.28
|
Diluted
|
$
0.23
|
$
0.47
|
$
0.54
|
$
1.25
|
|
|
|
|
|
Shares used in
computing net income per share:
|
|
|
|
|
Basic
|
59,594
|
57,617
|
59,089
|
57,100
|
Diluted
|
60,125
|
59,423
|
59,932
|
58,790
|
OMNIVISION TECHNOLOGIES,
INC.
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET
INCOME
(in thousands, except per share amounts) (unaudited)
|
|
|
|
|
|
Three Months
Ended
|
Six Months
Ended
|
Three Months
Ended
|
|
October 31,
|
October 31,
|
July 31,
|
|
2015
|
2014
|
2015
|
2014
|
2015
|
GAAP net
income
|
$ 13,946
|
$ 28,044
|
$ 32,188
|
$ 73,371
|
$ 18,242
|
Add:
|
|
|
|
|
|
Stock-based
compensation in cost of revenues
|
1,129
|
1,166
|
2,472
|
2,151
|
1,343
|
Stock-based
compensation in research, development and related
expenses
|
3,773
|
4,209
|
8,563
|
8,469
|
4,790
|
Stock-based
compensation in selling, general and administrative
expenses
|
2,970
|
3,280
|
6,709
|
6,484
|
3,739
|
Decrease in provision
for (benefit from) income taxes without the effect of stock-based
compensation
|
926
|
232
|
1,387
|
834
|
461
|
Non-GAAP net
income
|
$
22,744
|
$
36,931
|
$
51,319
|
$
91,309
|
$
28,575
|
|
|
|
|
|
|
GAAP provision for
(benefit from) income taxes
|
$ 2,738
|
$ 2,572
|
$ 700
|
$ (9,073)
|
$ (2,038)
|
Decrease in provision
for (benefit from) income taxes without the effect of stock-based
compensation
|
926
|
232
|
1,387
|
834
|
461
|
Non-GAAP provision for
(benefit from) income taxes
|
$
1,812
|
$
2,340
|
$
(687)
|
$
(9,907)
|
$
(2,499)
|
|
|
|
|
|
|
Non-GAAP net income per
share:
|
|
|
|
|
|
Basic
|
$
0.38
|
$
0.64
|
$
0.87
|
$
1.60
|
$
0.49
|
Diluted
|
$
0.37
|
$
0.60
|
$
0.83
|
$
1.50
|
$
0.46
|
|
|
|
|
|
|
Shares used in
computing non-GAAP net income per share:
|
|
|
|
|
|
Basic
|
59,594
|
57,617
|
59,089
|
57,100
|
58,584
|
Diluted
|
62,209
|
61,730
|
62,166
|
60,905
|
62,124
|
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SOURCE OmniVision Technologies, Inc.