OmniVision Reports Financial Results For The Fourth Quarter Of Fiscal 2014 - KPTV - FOX 12

OmniVision Reports Financial Results For The Fourth Quarter Of Fiscal 2014

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SOURCE OmniVision Technologies Inc.

SANTA CLARA, Calif., May 29, 2014 /PRNewswire/ -- OmniVision Technologies, Inc. (Nasdaq: OVTI), a leading developer of advanced digital imaging solutions, today reported financial results for the fourth quarter of fiscal 2014 that ended on April 30, 2014.

OmniVision logo.

Revenues for the fourth quarter of fiscal 2014 were $331.0 million, as compared to $352.0 million in the third quarter of fiscal 2014, and $336.2 million in the fourth quarter of fiscal 2013. GAAP net income in the fourth quarter of fiscal 2014 was $15.1 million, or $0.26 per diluted share, as compared to net income of $30.6 million, or $0.54 per diluted share in the third quarter of fiscal 2014, and $8.9 million, or $0.17 per diluted share in the fourth quarter of fiscal 2013.

Non-GAAP net income in the fourth quarter of fiscal 2014 was $23.9 million, or $0.40 per diluted share. Non-GAAP net income in the third quarter of fiscal 2014 was $40.4 million, or $0.69 per diluted share. Non-GAAP net income in the fourth quarter of fiscal 2013 was $17.5 million, or $0.31 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 months and fiscal year ended April 30, 2014 and 2013 and for the three months ended January 31, 2014.

Revenues for the fiscal year ended April 30, 2014 were $1.5 billion, as compared to $1.4 billion million in fiscal 2013. GAAP net income for fiscal 2014 was $95.0 million, or $1.70 per diluted share, as compared to GAAP net income for fiscal 2013 of $42.9 million, or $0.80 per diluted share.

Non-GAAP net income for fiscal 2014 was $131.0 million, or $2.24 per diluted share. Non-GAAP net income for fiscal 2013 was $79.0 million, or $1.41 per diluted share.

GAAP gross margin for the fourth quarter of fiscal 2014 was 20.1%, as compared to 19.6% for the third quarter of fiscal 2014 and 17.5% for the fourth quarter of fiscal 2013. The sequential increase in fourth quarter gross margin was primarily attributable to the introduction of newer and lower cost products into our shipment mix.

The Company ended the period with cash, cash equivalents and short-term investments totaling $450.9 million, an increase of $57.9 million from the previous quarter. The increase was primarily attributable to cash provided by operating activities in the fourth quarter of fiscal 2014.

"We are pleased to conclude our fiscal 2014 on a high note. Our financial metrics have continued to improve, with better gross margin, higher cash balance, and lower inventories. We have made meaningful progress on multiple fronts, including the diversification of our revenues into multiple geographies, especially in Asia, and the strong growth in our emerging automotive and security markets," said Shaw Hong, chief executive officer of OmniVision Technologies, Inc. "We are also working on new technologies and applications in our core and emerging markets that have the potential to substantially enhance our market position over the longer term."

Outlook

Based on current trends, the Company expects revenues for the first quarter of fiscal 2015 will be in the range of $360 million to $400 million and GAAP net income per share will be between $0.29 and $0.49 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 $0.43 and $0.63 per diluted share. Refer to the table below for a reconciliation of GAAP to non-GAAP net income.

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 866-700-6067 (domestic) or 617-213-8834 (international) and entering passcode 97143030.

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 ten days beginning approximately three hours after the conclusion of the call. To access the replay, dial 888-286-8010 (domestic) or 617-801-6888 (international) and enter passcode 23441558.

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, 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 our expectations regarding revenues and earnings per share for the three months ending July 31, 2014 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 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; 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; 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, 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 impact of general economic conditions on orders from the end-user customers of 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 July 31, 2014


GAAP
Range of Estimates




Non-GAAP
Range of Estimates


From


To


Adjustment


From


To

Net income per share

$    0.29


$    0.49


$    0.14  (1)


$    0.43


$    0.63











(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)


April 30,


April 30,


2014


2013

ASSETS




Current assets:




      Cash and cash equivalents

$       297,952


$       190,171

      Short-term investments

152,993


22,164

      Accounts receivable, net

172,472


166,517

      Inventories

270,935


430,315

      Deferred income taxes

4,973


4,028

      Prepaid expenses and other current assets

6,576


11,982

            Total current assets

905,901


825,177

Property, plant and equipment, net

153,792


158,394

Long-term investments

154,409


139,746

Goodwill      

10,227


10,227

Intangibles, net

66,217


56,804

Other long-term assets

32,529


36,666

                  Total assets

$    1,323,075


$    1,227,014





LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




      Accounts payable

$       142,012


$       188,261

      Accrued expenses and other current liabilities

31,959


40,274

      Income tax payable  

2,316


2,904

      Deferred revenues, less cost of revenues 

25,783


15,493

      Current portion of long-term debt

3,802


3,769

            Total current liabilities

205,872


250,701

Long-term liabilities:




      Long-term income taxes payable

86,498


90,777

      Non-current portion of long-term debt

32,030


35,709

      Other long-term liabilities

11,818


4,618

            Total long-term liabilities

130,346


131,104

            Total liabilities

336,218


381,805





Stockholders' equity:




      Common stock, $0.001 par value; 100,000 shares authorized; 76,681 shares issued and 56,082 outstanding at April 30, 2014 and 74,574 shares issued and 53,975 outstanding at April 30, 2013, respectively

77


75

      Additional paid-in capital

664,602


616,379

      Accumulated other comprehensive income

2,378


3,952

      Treasury stock, 20,599 at April 30, 2014 and April 30, 2013, respectively

(278,683)


(278,683)

      Retained earnings

598,483


503,486

            Total stockholders' equity

986,857


845,209

                  Total liabilities and stockholders' equity

$    1,323,075


$    1,227,014

 


OMNIVISION TECHNOLOGIES, INC.


CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)

(unaudited)



Three Months Ended


Year Ended


April 30,


April 30,


2014


2013


2014


2013

Revenues

$   330,969


$   336,215


$  1,453,929


$  1,407,929

Cost of revenues

264,406


277,486


1,178,207


1,163,815

      Gross profit

66,563


58,729


275,722


244,114









Operating expenses:








      Research, development and related

31,487


26,605


119,248


113,194

      Selling, general and administrative

18,608


17,878


73,292


72,958

      Amortization of acquired patent portfolio

2,322


2,322


9,286


9,286

            Total operating expenses

52,417


46,805


201,826


195,438









Income from operations

14,146


11,924


73,896


48,676

Benefit from acquisition of production operations from VisEra      

3,057


-


3,057


-

Equity in earnings of investee     

745


577


4,009


3,832

Interest expense, net

(487)


(499)


(2,029)


(2,700)

Other income (expense), net      

790


45


25,996


356

Income before income taxes

18,251


12,047


104,929


50,164









Provision for income taxes

3,178


3,125


9,932


7,262

Net income

$     15,073


$       8,922


$       94,997


$       42,902









Net income per share:








      Basic

$      0.27


$      0.17


$           1.71


$          0.80

      Diluted      

$      0.26


$      0.17


$           1.70


$          0.80









Shares used in computing net income per share:








      Basic

56,042


53,943


55,537


53,529

      Diluted      

56,882


54,061


56,043


53,671

 

OMNIVISION TECHNOLOGIES, INC.


RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME

(in thousands, except per share amounts)

(unaudited)








Three Months Ended


Year Ended


Three Months Ended


April 30,


April 30,


January 31,


2014


2013


2014


2013


2014

GAAP net income

$   15,073


$     8,922


$     94,997


$   42,902


$     30,560

Add:










      Stock-based compensation in cost of revenues

1,006


871


3,962


3,822


999

      Stock-based compensation in research, development and related expenses

4,480


3,660


16,486


16,193


4,276

      Stock-based compensation in selling, general and administrative expenses

3,645


3,230


14,595


13,496


3,668

Decrease (increase) in provision for income taxes without the effect of stock-based compensation

(299)


777


952


2,617


922

Non-GAAP net income

$   23,905


$   17,460


$   130,992


$   79,030


$     40,425











GAAP provision for income taxes     

$     3,178


$     3,125


$       9,932


$     7,262


$     11,696

Decrease (increase) in provision for income taxes without the effect of stock-based compensation

(299)


777


952


2,617


922

Non-GAAP provision for income taxes

$     3,477


$     2,348


$       8,980


$     4,645


$     10,774











Non-GAAP net income per share:










            Basic

$      0.43


$      0.32


$        2.36


$      1.48


$         0.72

            Diluted

$      0.40


$      0.31


$        2.24


$      1.41


$         0.69











Shares used in computing non-GAAP net income per share:










            Basic

56,042


53,943


55,537


53,529


55,913

            Diluted

59,088


56,525


58,546


56,092


58,936

 

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