ZHUHAI, China, Aug. 3 /PRNewswire-Asia/ -- Actions Semiconductor Co., Ltd. (Nasdaq: ACTS), one of China's leading fabless semiconductor companies that provides comprehensive mixed-signal system-on-a-chip (SoC) and multimedia digital signal processing (DSP) solutions for portable consumer electronics, today reported its financial results for the second quarter ended June 30, 2010.
All financial results are reported on a U.S. GAAP basis.
Revenue for the second quarter of 2010 was $9.7 million, as compared to revenue of $7.9 million for the first quarter of 2010, and $10.5 million for the second quarter of 2009.
Net loss attributable to Actions Semiconductor's shareholders for the second quarter of 2010 was $0.4 million, or $0.01 per ADS compared to net loss attributable to Actions Semiconductor's shareholders of $0.9 million, or $0.01 per ADS, for the first quarter of 2010, and net loss attributable to Actions Semiconductor's shareholders of $0.8 million, or $0.01 per ADS, for the second quarter of 2009.
Actions Semiconductor reported gross margin of 39.6% for the second quarter of 2010, as compared to gross margin of 39.6% for the first quarter of 2010, and 27.7% for the second quarter of 2009. The Company ended the quarter with $71.4 million in cash and cash equivalents together with time deposits. Trading securities and marketable securities, current and non-current, were $174.1 million at the end of the quarter.
Since the share repurchase programs started in 2007, the Company has invested approximately $31.2 million in repurchasing its shares. As of June 30, 2010, approximately 13.1 million American Depositary Shares (ADSs) were repurchased.
"We were pleased to deliver better than expected results for the second quarter," stated Mr. Niccolo Chen, CEO of Actions Semiconductor. "Our gross margin continued to benefit from our ongoing cost reduction programs as well as solid revenue contributions from our high-end products. Average selling prices ("ASP") remained relatively stable, despite increased shipment volumes into lower-end applications such as the automotive and boom box sectors.
"Building on the traction we have experienced with our Series 13 and Series 25 products targeting the QVGA and D1 markets, we are continuing to expand the advanced applications and end-markets addressed by our product portfolio through our R&D efforts. We believe the high-end MP4 sectors offer attractive opportunities to drive growth and margin performance. We remain confident in our ability to strategically position the Company to take advantage of the gradual rebound in demand for consumer electronics and to improve our performance over time," concluded Mr. Chen.
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.
For the third quarter of fiscal year 2010 ending September 30, 2010, Actions Semiconductor estimates revenue in the range of $9.0 to $10.0 million, gross margin slightly lower than second quarter, and operating expenses slightly higher on a sequential basis without factoring in additional R&D expenses associated with our pending acquisition in the third quarter. The third quarter 2010 estimates include share-based compensation of approximately $0.1 million.
Conference Call Details
Actions Semiconductor's second quarter 2010 teleconference and webcast is scheduled to begin at 5:30 p.m. Eastern Time, on Tuesday, August 3, 2010. To participate in the live call, analysts and investors should dial 877-941-2069 (within U.S.) or 480-629-9713 (outside U.S.) at least ten minutes prior to the call. 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 http://www.actions-semi.com . An audio replay of the call will be available to investors through August 4, 2010, by dialing 800-406-7325 (within U.S.) or 303-590-3030 (outside U.S.) and entering the passcode 432970.
About Actions Semiconductor
Actions Semiconductor is one of China's leading fabless semiconductor companies that provides mixed-signal and multimedia 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 and the providers of those 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 Beijing, Shanghai, and Shenzhen. 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 signs of positive indicators in the industry for next year, growth in the market driven by continued proliferation of applications within the PMP market and incremental rebound of overall demand for these products, Actions Semiconductor's belief that it is positioned to capture some upside from these trends, and Actions Semiconductor's future expectations with respect to revenue, gross margin, operating expenses and share-based compensation expense. 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.
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED BALANCE SHEET
(in thousands of U.S. dollars)
At June At March At December
30, 2010 31, 2010 31, 2009
(unaudited) (unaudited) (audited)
ASSETS
Current assets:
Cash and cash equivalents 71,311 99,924 87,706
Time deposits 47 47 62
Marketable securities 135,278 133,434 139,984
Trading securities 495 500 --
Accounts receivable, net 1,986 1,940 1,891
Amount due from a related party 457 767 530
Amount due from an equity method
investee 287 404 492
Inventories 3,356 3,555 4,501
Prepaid expenses and other current
assets 2,815 1,339 1,258
Deferred tax assets 583 285 371
Income tax receivable 188 55 --
Total current assets 216,803 242,250 236,795
Investment in equity method
investees 1,751 2,025 1,577
Other investments (NIL, NIL and
$420 carried at fair value as of
June 30, 2010, March 31, 2010 and
December 31, 2009 respectively) 2,746 3,639 3,258
Marketable securities ($13,989,
$13,917 and NIL carried at fair
value as of June 30, 2010, March
31, 2010 and December 31, 2009
respectively) 38,287 13,917 23,773
Rental deposits 53 61 46
Property, plant and equipment, net 18,502 16,341 14,437
Land use right 1,537 1,538 1,546
Acquired intangible assets, net 3,154 3,552 3,625
Deposit paid for acquisition of
land use right 901 -- --
Deposit paid for acquisition of
intangible assets 1,100 -- --
Deferred tax assets 117 131 149
TOTAL ASSETS 284,951 283,454 285,206
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable 3,947 2,518 2,355
Accrued expenses and other current
liabilities 6,193 5,291 4,626
Other liabilities 2,296 2,196 2,124
Income tax payable 208 -- 129
Deferred tax liabilities 374 380 284
Total current liabilities 13,018 10,385 9,518
Other liabilities 122 326 319
Deferred tax liabilities 2,129 2,072 2,058
Total liabilities 15,269 12,783 11,895
Equity:
Ordinary shares 1 1 1
Additional paid-in capital 28,428 29,822 31,423
Accumulated other comprehensive
income 20,920 20,074 20,239
Retained earnings 220,333 220,774 221,648
Total Actions Semiconductor Co., Ltd.
shareholders' equity 269,682 270,671 273,311
TOTAL LIABILITIES AND EQUITY 284,951 283,454 285,206
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(in thousands of U.S. dollars, except per share amounts)
Three months Three months Six months Six months
ended ended ended ended
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues:
Third-parties:
System-on-a-chip
products 7,906 7,406 14,191 15,636
Semiconductor
product testing
services 36 49 58 84
7,942 7,455 14,249 15,720
Related-parties:
System-on-a-chip
products 1,720 3,077 3,303 7,051
Total revenues 9,662 10,532 17,552 22,771
Cost of revenues:
Third-parties:
System-on-a-chip
products (4,780) (5,306) (8,573) (10,681)
Semiconductor
product testing
services (18) (27) (33) (59)
(4,798) (5,333) (8,606) (10,740)
Related-parties:
System-on-a-chip
products (1,040) (2,284) (2,000) (5,007)
Total cost of
revenues (5,838) (7,617) (10,606) (15,747)
Gross profit 3,824 2,915 6,946 7,024
Other operating income 341 6 474 273
Operating expenses:
Research and
development (4,437) (4,956) (8,994) (9,666)
General and
administrative (2,352) (1,795) (4,092) (4,170)
Selling and
marketing (305) (290) (551) (580)
Total operating
expenses (7,094) (7,041) (13,637) (14,416)
Loss from operations (2,929) (4,120) (6,217) (7,119)
Other income (expense) 452 161 482 (726)
Fair value change in
financial instruments 1 1 133 42
Interest income 2,244 3,116 4,678 5,990
Interest expense -- (32) -- (59)
Loss before income
taxes, equity in net
loss of equity
method investees and
non-controlling
interest (232) (874) (924) (1,872)
Income tax credit
(expense) 64 153 34 (242)
Equity in net loss of
equity method
investees (273) (161) (425) (340)
Net loss (441) (882) (1,315) (2,454)
Less: Net loss
attributable to non-
controlling interest -- 105 -- 1,885
Net loss attributable
to Actions
Semiconductor
Co., Ltd. (441) (777) (1,315) (569)
Net loss per share-
basic and diluted:
Net loss attributable
to Actions
Semiconductor
Co., Ltd. (0.001) (0.002) (0.003) (0.005)
Basic and diluted (per
ADS) (0.006) (0.010) (0.018) (0.029)
Weighted-average
shares used in
computation:
Basic 441,181,871 461,911,062 444,005,616 464,898,891
Basic and diluted 441,181,871 461,911,062 444,005,616 464,898,891
Weighted-average ADS
used in computation :
Basic 73,530,312 76,985,177 74,000,936 77,483,149
Basic and diluted 73,530,312 76,985,177 74,000,936 77,483,149
Note: Stock
compensation recorded
in each expense
classification
above is as follows:
Research and
development 663 681 1,353 1,332
General and
administrative 225 351 500 693
Selling and
marketing 38 54 79 107
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars)
Three months Six months Six months
ended ended ended
June 30, June 30, June 30,
2010 2010 2009
(unaudited) (unaudited) (unaudited)
Operating activities:
Net loss (441) (1,315) (569)
Adjustments to reconcile net loss to
net cash provided by
Operating activities:
Depreciation of property, plant and
equipment 455 936 1,061
Land use right 8 16 16
Allowance for doubtful accounts
receivable -- (102) (60)
Amortization of acquired intangible
assets 448 984 1,580
Utilization of subsidy from local
authorities of Beijing and Zhuhai,
the People's Republic of China
(PRC) (117) (117) (226)
Write down of inventories -- -- (76)
Loss (gain) on disposal of
property, plant and equipment 53 53 (7)
Gain on disposal of other
investment -- (137) --
Equity in net loss of equity method
investees 274 426 340
Share-based compensation 926 1,932 2,132
Fair value change in trading
securities -- 3 (40)
Deferred taxes (234) (21) 613
Proceeds from disposal of trading
securities 5 5 30,649
Purchase of trading securities -- (470) (11,310)
Changes in operating assets and
liabilities:
Accounts receivable (46) 7 (647)
Amount due from a related party 310 73 561
Notes receivable -- -- 10
Inventories 213 1,159 2,488
Amount due from an equity method
investee 120 208 --
Prepaid expenses and other
current assets (1,035) (1,116) (866)
Accounts payable 1,416 1,579 1,779
Accrued expenses and other
current liabilities (77) (1,994) (2,203)
Income tax receivable (133) (188) (187)
Income tax payable 210 81 (212)
Deposit paid for acquisition of
land use right (901) (901) --
Rental deposit (paid) refunded 8 (7) (21)
Net cash provided by operating
activities 1,462 1,094 24,805
Investing activities:
Increase in an equity method
investees -- (600) --
Proceeds from the disposal of other
investments 897 1,251 --
Proceeds from redemption of
marketable securities -- 45,235 --
Purchase of marketable securities (25,879) (54,689) 17,842
Proceeds from disposal of property,
plant and equipment -- -- 27
Increase in deposit paid for
acquisition of property, plant and
equipment -- -- (1,733)
Purchase of property, plant and
equipment (1,664) (2,425) (2,108)
Purchase of intangible assets (27) (327) (2,185)
Deposit paid for acquisition of
intangible assets (1,100) (1,100) --
Decrease in restricted cash -- -- 40
Increase (decrease) in time
deposits -- 15 (42)
Net cash (used in) from investing
activities (27,773) (12,640) 11,841
Financing activities:
Repayment of short-term bank loans -- -- (2)
Advance subsidy from local
authorities of Shenzhen and
Zhuhai, the PRC -- 79 475
Issuance of ordinary shares for
share option plan 64 64 --
Repurchase of ordinary shares (2,384) (4,991) (6,328)
Net cash used in financing activities (2,320) (4,848) (5,855)
Net (decrease) increase in cash and
cash equivalents (28,631) (16,394) 30,791
Cash and cash equivalents at the
beginning of the period 99,924 87,706 45,435
Effect of exchange rate changes on
cash 18 (1) (4)
Cash and cash equivalents at the end
of the period 71,311 71,311 76,222
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