omniture

GigaMedia Announces Third-Quarter 2019 Financial Results

2019-10-31 21:00 6346

TAIPEI, Oct. 31, 2019 /PRNewswire/ -- GigaMedia Limited (NASDAQ: GIGM) today announced its third-quarter 2019 unaudited financial results.

Comments from Management

In the third quarter of 2019, total revenues increased by 9.0% to approximately $1.91 million, from $1.75 million last quarter. While the increase of revenues was mainly due to seasonalities exhibited in certain games for summer peak and anniversary promotions, the overall gross margin widened to 55.0%, compared to 44.0% in last quarter and 41.8% in the same quarter last year, as a result of an improved cost structure.

And we were also making progress in developing in-house offerings, among which a new casual game platform will be released to the closed and then open beta testing tracks in the next quarter.

"During past quarters in 2019, besides pursuing an internally-driven growth by developing our own offerings, we continued improving the cost structure of our licensed game operations, as well as calibrating our marketing and promotional strategies for better effectiveness," said GigaMedia CEO James Huang, "and the efforts now gradually began to bear fruits."

Third Quarter Overview

  • Revenues increased approximately by 9.0% quarter-on-quarter to $1.91 million from $1.75 million in the second quarter of this year, and by 14.8% year-over-year from $1.66 million in the same period last year.
  • Gross profit increased to $1.05 million from $0.77 million in the second quarter of 2019.
  • Net loss reduced considerably to $0.24 million from $0.61 million in last quarter, and from $1.08 million in the same period last year.
  • The net asset value was around $5.13 per share.

Unaudited Consolidated Financial Results

GigaMedia Limited is a diversified provider of digital entertainment services. GigaMedia's digital entertainment service business FunTown develops and operates a suite of digital entertainments in Taiwan and Hong Kong, with focus on browser/mobile games and casual games.

Unaudited consolidated results of GigaMedia are summarized in the table below.

For the third Quarter

GIGAMEDIA3Q19 UNAUDITED CONSOLIDATED FINANCIAL RESULTS


(unaudited, all figures in US$ thousands, except per share amounts)


3Q19


2Q19



Change

(%)



3Q19


3Q18


Change

(%)


Revenues



1,908



1,750



9.0

%



1,908



1,662


14.8

%

Gross Profit



1,049



769



36.4

%



1,049



694


51.2

%

Loss from Operations



(544)



(1,122)



NM




(544)



(1,484)


NM


Net Loss Attributable to GigaMedia



(242)



(614)



NM




(242)



(1,083)


NM


Loss Per Share Attributable to GigaMedia, Diluted



(0.02)



(0.06)



NM




(0.02)



(0.10)


NM


EBITDA (A)



(585)



(1,000)



NM




(585)



(1,393)


NM


CashRestricted Cash and Cash Equivalents



58,164



58,015



0.3

%



58,164



60,439


-3.8

%

NM= Not Meaningful


(A)  EBITDA (earnings before interest, taxes, depreciation, and amortization) is provided as a supplement to results provided in accordance with U.S. generally accepted accounting principles ("GAAP"). (See, "Use of Non-GAAP Measures," for more details.) 

Third-Quarter Financial Results

  • Consolidated revenues for the third quarter of 2019 increased by 9.0% to $1.91 million from $1.75 million in the prior quarter and by 14.8% year-over-year from $1.66 million in the third quarter 2018. The increase was mainly due to the summer peak of Tales Runner, and the 4th anniversary promotions for Yume100, while Senran Kagura: New Link, a new game launched last quarter, recorded a flat performance in this quarter.
  • Consolidated gross profit increased by 36.4% quarter-on-quarter to $1.05 million from $0.77 million and 51.2% year-over-year from $0.69 million the third quarter last year.
  • Consolidated operating expenses were $1.59 million in the third quarter of 2019, representing a decrease of $0.30 million from the second quarter of 2019. The decrease was due to higher expenses in last quarter, mainly for the launch of Senran Kagura in addition to certain administrative activities.
  • Consolidated loss from operation of the third quarter of 2019 was $0.54 million, a decrease of loss by approximately $0.58 million from a loss of $1.12 million in last quarter.
  • Consolidated net loss of the third quarter of 2019 was $0.24 million, reduced from $0.61 million in last quarter.
  • Cash, restricted cash and cash equivalents as of the end of the third quarter of 2019 amounted to $58.16 million, increased by 0.3% from $58.02 million at the end of the second quarter of 2019.

Financial Position

GigaMedia maintained its solid financial position, with cash, restricted cash and cash equivalents accounted for $58.16 million, or $5.26 per share, as of September 30, 2019.

Business Outlook

The following forward-looking statements reflect GigaMedia's expectations as of October 31, 2019. Given potential changes in economic conditions and consumer spending, the evolving nature of online games, and various other risk factors, including those discussed in the Company's 2018 Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission as referenced below, actual results may differ materially.

"Following our strategic plan outlined in the beginning of 2019, we have steadily built up healthier operations for both our licensed and self-developed games, and have accumulated momentums for future growth," said GigaMedia CEO James Huang. "In the coming quarter, we will continue to boost productivities by improving existing products and services, introducing own offerings, along with adopting strategies of promoting customer relationships."

As for the customer platform, "while it is still at a nascent stage and we are working on creating capacity for providing more diverse products and services, it presents a great potential on saving marketing and channel costs," continued CEO James Huang. "And we consider it essential in broadening and cultivating a loyal and profitable customer base, where we can take various initiatives to promote customer values."

Meanwhile, our business strategies always include expanding through mergers and acquisitions. "We will also continue reviewing prospects that can provide synergies to our business for accelerating our growth and enhancing shareholders' value," stated CEO James Huang.

Use of Non-GAAP Measures

To supplement GigaMedia's consolidated financial statements presented in accordance with US GAAP, the Company uses the following measure defined as non-GAAP by the SEC: EBITDA. Management believes that EBITDA (earnings before interest, taxes, depreciation, and amortization) is a useful supplemental measure of performance because it excludes certain non-cash items such as depreciation and amortization and that EBITDA is a measure of performance used by some investors, equity analysts and others to make informed investment decisions. EBITDA is not a recognized earnings measure under GAAP and does not have a standardized meaning. Non-GAAP measures such as EBITDA should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, other financial measures prepared in accordance with GAAP. A limitation of using EBITDA is that it does not include all items that impact the company's net income for the period. Reconciliations to the GAAP equivalents of the non-GAAP financial measures are provided on the attached unaudited financial statements.

About the Numbers in This Release

Quarterly results

All quarterly results referred to in the text, tables and attachments to this release are unaudited. The financial statements from which the financial results reported in this press release are derived have been prepared in accordance with U.S. GAAP, unless otherwise noted as "non-GAAP," and are presented in U.S. dollars.

Q&A

For Q&A regarding the third quarter 2019 performance upon the release, investors may send the questions via email to IR@gigamedia.com.tw, and the responses will be replied individually.

About GigaMedia

Headquartered in Taipei, Taiwan, GigaMedia Limited (Singapore registration number: 199905474H) is a diversified provider of digital entertainment services in Taiwan and Hong Kong. GigaMedia's digital entertainment service business is an innovative leader in Asia with growing capabilities of development, distribution and operation of digital entertainments, as well as platform services for games with a focus on mobile games and casual games. More information on GigaMedia can be obtained from www.gigamedia.com.tw.

The statements included above and elsewhere in this press release that are not historical in nature are "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding expected financial performance (as described without limitation in the "Business Outlook" section and in quotations from management in this press release) and GigaMedia's strategic and operational plans. These statements are based on management's current expectations and are subject to risks and uncertainties and changes in circumstances. There are important factors that could cause actual results to differ materially from those anticipated in the forward looking statements, including but not limited to, our ability to license, develop or acquire additional online games that are appealing to users, our ability to retain existing online game players and attract new players, and our ability to launch online games in a timely manner and pursuant to our anticipated schedule. Further information on risks or other factors that could cause results to differ is detailed in GigaMedia's Annual Report on Form 20-F filed in April 2019 and its other filings with the United States Securities and Exchange Commission.

#  #  #

(Tables to follow)

GIGAMEDIA LIMITED

CONSOLIDATED STATEMENTS OF OPERATIONS



Three months ended

Nine months ended




9/30/2019


6/30/2019


9/30/2018


9/30/2019


9/30/2018



unaudited


unaudited


unaudited


unaudited


unaudited



USD


USD


USD


USD


USD

Operating revenues
















Digital entertainment service revenues



1,908,261



1,749,583



1,662,324



5,141,077



5,481,704

Other revenues














1,908,261



1,749,583



1,662,324



5,141,077



5,481,704

Operating costs
















Cost of digital entertainment service revenues



859,511



980,448



968,442



2,584,861



2,845,551

Cost of other revenues














859,511



980,448



968,442



2,584,861



2,845,551

Gross profit



1,048,750



769,135



693,882



2,556,216



2,636,153

Operating expenses
















Product development and engineering expenses



326,419



325,144



286,015



972,057



875,820

Selling and marketing expenses



461,653



580,539



963,444



1,568,194



2,720,380

General and administrative expenses



800,015



974,648



923,288



2,610,650



2,823,151

Other



4,723



11,165



5,514



21,103



18,564




1,592,810



1,891,496



2,178,261



5,172,004



6,437,915

Loss from operations



(544,060)



(1,122,361)



(1,484,379)



(2,615,788)



(3,801,762)

Non-operating income (expense)
















Interest income



364,539



414,450



351,262



1,160,788



968,808

Foreign exchange (loss) gain - net



(62,487)



90,922



49,285



17,033



137,203

Gain on disposal of property, plant and equipment











31

Other - net



119



3,416



728



50,448



5,196




302,171



508,788



401,275



1,228,269



1,111,238

Loss before income taxes



(241,889)



(613,573)



(1,083,104)



(1,387,519)



(2,690,524)

Income tax benefit (expense)











Net loss attributable to GigaMedia



(241,889)



(613,573)



(1,083,104)



(1,387,519)



(2,690,524)

















Loss per share attributable to GigaMedia
















Basic:



(0.02)



(0.06)



(0.10)



(0.13)



(0.24)

Diluted:



(0.02)



(0.06)



(0.10)



(0.13)



(0.24)

Weighted average shares outstanding:
















Basic



11,052,235



11,052,235



11,052,235



11,052,235



11,052,235

Diluted



11,052,235



11,052,235



11,052,235



11,052,235



11,052,235

 

GIGAMEDIA LIMITED

CONSOLIDATED BALANCE SHEETS



9/30/2019


6/30/2019


9/30/2018



unaudited


unaudited


unaudited



USD


USD


USD

Assets










Current assets










Cash and cash equivalents



57,635,576



57,489,563



59,923,784

Accounts receivable - net



591,302



591,905



835,013

Prepaid expenses



142,819



275,551



237,635

Restricted cash



528,387



525,354



514,770

Other receivables



457,168



458,383



316,540

Other current assets



165,294



131,150



129,114

Total current assets



59,520,546



59,471,906



61,956,856











Property, plant & equipment - net



101,998



92,580



147,600

Intangible assets - net



78,828



23,545



41,109

Prepaid licensing and royalty fees



468,722



574,274



1,097,911

Other assets



918,556



1,035,529



278,356

Total assets



61,088,650



61,197,834



63,521,832











Liabilities and equity










Accounts payable



140,676



119,597



279,485

Accrued compensation



371,212



253,262



606,547

Accrued expenses



1,470,179



1,340,539



2,066,188

Unearned revenue



1,504,176



1,617,881



1,971,039

Other current liabilities



241,788



197,776



196,516

Total current liabilities



3,728,031



3,529,055



5,119,775

Other liabilities



662,530



781,187



Total liabilities



4,390,561



4,310,242



5,119,775

Total equity



56,698,089



56,887,592



58,402,057

Total liabilities and equity



61,088,650



61,197,834



63,521,832

 

GIGAMEDIA LIMITED

RECONCILIATIONS OF NON-GAAP RESULTS OF OPERATIONS









Three months ended

Nine months ended




9/30/2019


6/30/2019


9/30/2018


9/30/2019


9/30/2018



unaudited


unaudited


unaudited


unaudited


unaudited



USD


USD


USD


USD


USD

Reconciliation of Net Loss to EBITDA















Net loss attributable to GigaMedia



(241,889)



(613,573)



(1,083,104)


(1,387,519)



(2,690,524)

Depreciation



9,919



14,769



25,318


50,076



74,334

Amortization



11,126



12,830



16,516


36,854



31,876

Interest income



(364,539)



(414,450)



(351,262)


(1,160,788)



(968,808)

Interest expense










Income tax (benefit) expense










EBITDA



(585,383)



(1,000,424)



(1,392,532)


(2,461,377)



(3,553,122)

 

 

 

Cision View original content:http://www.prnewswire.com/news-releases/gigamedia-announces-third-quarter-2019-financial-results-300949069.html

Source: GigaMedia Limited
Related Stocks:
NASDAQ:GIGM
Related Links:
collection