omniture

Actions Semiconductor Reports Record Results for Fourth Quarter and Full Year2006

2007-02-07 13:53 2293

Q4 Net Revenues of $49.5 Million

2006 Net Revenues of $170.4 Million

ZHUHAI, China, Feb. 7 /Xinhua-PRNewswire/ -- 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 record financial results for the fourth quarter and year ended December 31, 2006.

All financial results are reported on U.S. GAAP basis.

Revenue for the fourth quarter of 2006 was $49.5 million, a 24% increase over revenue of $39.9 million for the fourth quarter of 2005, and an 8% increase over revenue of $45.7 million for the third quarter of 2006. Revenue for the year ended December 31, 2006 was $170.4 million, a 14% increase over revenue of $149.6 million for the year ended December 31, 2005.

Net income for the fourth quarter of 2006 was $21.3 million, or $0.25 per ADS, compared to $19.9 million, or $0.24 per ADS, for the fourth quarter of 2005, and compared to $20.5 million, or $0.24 per ADS, for the third quarter of 2006. Net income for the full year of 2006 was $74.8 million, compared to $73.6 million reported for the full year 2005. Net income per ADS was $0.87 for 2006 based on 86 million ADS, compared to the $0.91 per ADS reported for the full year 2005 based on 80.5 million ADS.

Actions Semiconductor reported operating margins of 43.1% and gross margins of 51.9% for the fourth quarter of 2006. For the full year of 2006, operating margin was 44.7%, and gross margin was 55.5%. The Company ended the year with $137.8 million in cash and cash equivalents,and $45.7 million in time deposits, which have original maturity of more thanthree months but less than one year.

"We achieved another year of record results in 2006 with revenues topping $170 million, unit shipments at all-time highs, and excellent market reception of our Series 9. We started to ship samples of our latest Series 13, which positions us for another year of continued market leadership," commented Nan-Horng Yeh, Chief Executive Officer of Actions Semiconductor. "In fact, for 2006, Actions remained the clear market leader with the dominant market share position in terms of Personal Media Player SOC units shipped worldwide. In just the fourth quarter, Actions shipped in excess of 24 million units, which we believe accounted for approximately 50% of the units shipped worldwide."

"In addition to delivering record revenues in 2006, we continued our track record of exceptional profitability and technology innovation," continued Mr. Yeh. "Both annual gross and operating margins were at healthy levels: 55.5% and 44.7% respectively, again placing Actions in the upper tier of profitability for fabless semiconductor companies worldwide. On the technology front, samples distributed earlier this month of our Series 13 with full video functionality have been well-received. The Series 13 product family enhances Actions' competitive position by expanding our higher end product offerings. We continued to make excellent progress in broadening and advancing our product mix, with over 60% of our fourth quarter revenues derived from sales of our 9 Series. In addition, we have completed the production transition of our products to 0.18 micron process technology, which will help us to maintain our excellent cost profile. We are optimistic about the tremendous opportunities that lie ahead, and look forward to working with our valued partners to continue building a world-class fabless consumer semiconductor company," concluded Mr. Yeh.

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 quarter ended March 31, 2007, Actions Semiconductor estimates revenue in the range of $34 to $37 million, and, fully diluted earnings per ADS of $0.15 to $0.19.

Conference Call Details

The Actions Semiconductor Fourth Quarter teleconference and webcast is scheduled to begin at 5:30 p.m. Eastern Time, on Tuesday, February 6, 2007. To participate in the live call, analysts and investors should dial (800) 706-7745 or (617) 614-3472 and enter passcode 75524559 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 www.actions-semi.com. An audio replay of the call will be available through February 13, 2007, by dialing (888) 286-8010 and entering the passcode: 51626654. Callers outside the U.S. and Canada may access the replay by dialing (617) 801-6888 and entering the passcode: 51626654.

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 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. Forward-looking statements, including financial projections and forecasts, involve risks and uncertainties that could cause Actions Semiconductor's actual results to differ materially from our current expectations. Factors that could cause Actions Semiconductor's results to differ materially from those set forth in these forward-looking statements include 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 Registration Statement on Form F-1 related to our initial public offering and secondary offering. Actions Semiconductor undertakes no obligation to update or revise forward-looking statements to reflect subsequent events or changed assumptions or circumstances.

Actions Semiconductor Co., Ltd.

CONSOLIDATED BALANCE SHEETS

(in thousands of U.S. dollars)

At December 31, At December 31,

2006 2005

(unaudited) (audited)

ASSETS

Current assets

Cash and cash equivalents 137,778 108,896

Time deposits 45,713 23,172

Restricted Cash - 2,478

Marketable Securities 20,531 -

Accounts receivable 6,007 8,025

Notes receivable 2,154 1,722

Prepaid expenses and other current

assets 6,413 1,973

Amount due from an affiliate 133 -

Inventories 6,280 7,023

Income tax recoverable - 11

Deferred tax assets 626 528

Total current assets 225,635 153,828

Non current assets

Investment in an affiliate 1,469 500

Property, plant and equipment, net 6,749 2,360

Rental deposits 52 11

Deposit paid for acquisition of

property, plant and equipment 91 -

Acquired intangible assets, net 3,787 1,889

Total Non current assets 12,148 4,760

TOTAL ASSETS 237,783 158,588

LIABILITIES AND SHAREHOLDER'S EQUITY

Current liabilities:

Accounts payable 15,715 13,086

Accrued expenses and other current

liabilities 9,412 11,776

Other liabilities 692 71

Short-term bank loan - 2,374

Income tax payable 2,258 -

Amount due to shareholders 10 -

Total current liabilities 28,087 27,307

Other liabilities - 124

Total liabilities 28,087 27,431

Minority interest 486 582

Shareholders' equity

Ordinary shares 1 1

Additional paid-in capital 50,341 49,629

Accumulated other comprehensive

income 4,396 1,224

Retained earnings 154,472 79,721

Total shareholders' equity 209,210 130,575

TOTAL LIABILITIES AND SHAREHOLDERS'

EQUITY 237,783 158,588

Actions Semiconductor Co., Ltd.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands of U.S. dollars, except per share data)

Three months ended Year ended

December 31, December 31, December 31, December 31,

2006 2005 2006 2005

Net revenues 49,538 39,899 170,363 149,622

Cost of revenues (23,818) (17,247) (75,773) (60,586)

Gross profit 25,720 22,652 94,590 89,036

Other income 477 167 1,634 1,122

Operating expenses:

Selling and

marketing (456) 109 (1,570) (1,375)

General and

administrative (2,227) (3,033) (8,996) (8,968)

Research and

development (2,147) (1,324) (9,543) (7,825)

Total operating

expenses (4,830) (4,248) (20,109) (18,168)

Income from

operations 21,367 18,571 76,115 71,990

Interest income 1,496 568 4,876 1,148

Interest expense - (77) (160) (77)

Income before

income taxes,

equity in net loss

of an affiliate

and minority

interests 22,863 19,062 80,831 73,061

Income

taxes/benefit (1,621) 822 (6,020) 526

Equity in net loss

of an affiliate (16) - (156) -

Minority interests 38 18 96 18

Net income 21,264 19,902 74,751 73,605

Net income per

share:

Basis and diluted

per share: 0.04 0.04 0.14 0.15

Basic and diluted

(per ADS) 0.25 0.24 0.87 0.91

Weighted-average

shares used in

computation 516,000,000 492,000,000 516,000,000 483,000,000

Weighted-average

ADS used in

computation 86,000,000 82,000,000 86,000,000 80,500,000

Actions Semiconductor Co., Ltd.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(In thousands of U.S. dollars)

Year ended Year ended

December 31, December 31,

2006 2005

Operating activities:

Net income 74,751 73,605

Adjustments to reconcile net income

to net cash provided by operating

activities:

Depreciation and amortization of

property, plant and equipment 991 459

Amortization of acquired intangible

assets 990 239

Utilization of advance subsidy from

local authorities of Zhuhai,

the People's Republic of China

(the "PRC") (35) (77)

Loss (Gain) on disposal of

property, plant and equipment 65 (52)

Minority interests (96) (18)

Deferred tax (98) (521)

Equity in net loss of an affiliate 156 -

Fair value change in marketable

securities (29) -

Changes in operating assets and

liabilities:

Accounts receivable 2,086 (4,496)

Notes receivable (420) 103

Inventories 911 (2,005)

Prepaid expenses and other

current assets (4,030) (632)

Amount due from an affiliate (133) -

Income tax recoverable 11 (11)

Accounts payable 2,184 3,243

Accrued expenses and other

current liabilities (2,776) 7,328

Income tax payable 2,258 (25)

Net cash provided by operating

activities 76,786 77,140

Investing activities:

Investment in an affiliate (1,125) (500)

Capital contribution from a

minority shareholder - 600

Rental deposit paid (41) -

Proceeds from disposal of property,

plant and equipment 79 109

Increase in marketable securities (20,502) -

Purchase of property, plant and

equipment (5,793) (1,429)

Purchase of acquired intangible

assets (1,910) (1,697)

Decrease(increase) in restricted

cash 2,563 (2,478)

Increase in time deposits (21,471) (23,172)

Cash used in investing activities (48,200) (28,567)

Financing activities:

Proceeds from short-term bank loans 5,291 2,374

Repayment of short-term bank loans (7,665) -

Advance subsidy from local

authorities of Zhuhai, the PRC 447 124

Issue of shares - 44,630

Amount due to shareholders 77,377 -

Repayment of amount due to

shareholders (77,367) -

Dividend paid - (20,000)

Cash (used in) provided by financing

activities (1,917) 27,128

Effect of exchange rate changes 2,213 1,182

Net increase in cash and cash

equivalents 28,882 76,883

Cash and cash equivalents at the

beginning of the period 108,896 32,013

Cash and cash equivalents at the end

of the period 137,778 108,896

Source: Actions Semiconductor Co., Ltd.
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