Highlights:
* First quarter 2009 revenues, gross margin and EPS were all within
guidance
* Expect second quarter 2009 revenues to grow 52% to 55%
sequentially, gross margin to remain flat and GAAP EPS to be in
the range of $0.07 to $0.09
* Announced an annual cash dividend of $0.30 per ordinary share
TAINAN, Taiwan, May 18, 2009 (GLOBE NEWSWIRE) -- Himax Technologies, Inc. ("Himax" or "Company") (Nasdaq:HIMX) today reported financial results for the first quarter ended March 31, 2009.
For the first quarter of 2009, Himax reported net revenues of $125.7 million, representing a 45.7% decrease from $231.6 million for the first quarter of 2008 and a 1.1% increase from $124.3 million for the fourth quarter of 2008. Gross margin was 20.9% for the first quarter of 2009, down 440 basis points year-over-year and down 10 basis points sequentially. Operating income for the quarter was $4.8 million, compared to $31.7 million for the same period last year and operating loss of $21.3 million for the previous quarter. Excluding the bad debt expense related to SVA-NEC, operating income for the first quarter of 2009 was $5.2 million, compared to $4.0 million for the previous quarter.
Net income for the first quarter of 2009 was $4.4 million or $0.02 per diluted share, down from $34.1 million or $0.18 per diluted share for the first quarter of 2008 and up from a net loss of $13.2 million or $0.07 per diluted share for the fourth quarter of 2008. Excluding the bad debt expense related to SVA-NEC and its associated tax benefit, net income for the first quarter of 2009 was $4.7 million or $0.03 per diluted share, compared to $4.2 million or $0.02 per diluted share for the fourth quarter of 2008.
Excluding share-based compensation and acquisition-related charges, non-GAAP operating income for the first quarter of 2009 was $7.7 million, down from $34.6 million for the same period last year, and up from an operating loss of $18.8 million for the previous quarter. Excluding the bad debt expense related to SVA-NEC, non-GAAP operating income for the first quarter of 2009 was $8.1 million, as compared to $6.5 million for the fourth quarter of 2008.
Non-GAAP net income for the first quarter of 2009 was $7.0 million or $0.04 per diluted share, down from $37.0 million or $0.19 per diluted share for the first quarter of 2008, and up from a net loss of $10.9 million or $0.06 per diluted share for the fourth quarter of 2008. Excluding the bad debt expense related to SVA-NEC and its associated tax benefit, non-GAAP net income for the first quarter of 2009 was $7.4 million or $0.04 per diluted share, as compared to $6.5 million or $0.03 per diluted share for the fourth quarter of 2008.
Jordan Wu, President and Chief Executive Officer of Himax, commented, "Our customers' orders declined significantly toward the end of 2008. Starting in the later part of January, we began to see improvement in TFT-LCD panel demand primarily due to the overall inventory replenishments and the stimulus program implemented by the Chinese government for certain electronic appliances sold in rural areas. As a result, there has been an increase in rush orders for TFT-LCD panel manufacturers and for us. Although display drivers typically require the longest manufacturing lead time among the key components used in TFT-LCD panels, we are pleased that we were able to achieve on-time delivery for the majority of our customers' orders, even those where we were given extremely short notice, allowing our customers to capitalize on business opportunities. We are proud to demonstrate, once again, our value to our customers through our understanding of the display driver business and our close collaboration with both customers and suppliers."
Mr. Wu added, "We are also leveraging our worldwide leadership in the TFT-LCD display drivers to penetrate other display-related semiconductors, which include timing controllers, LCOS projector solutions, power management ICs, TV chipsets, monitor scalers and CMOS image sensors. As an example, we are now working closely with several of China's tier-one handset solution providers for our LCOS projector solutions and CMOS image sensors. These Chinese handset solution providers play a critical role in the development of the Chinese handset market and ecosystem. Another example to validate this cross-selling strategy is our timing controller and power management ICs where we have been winning new projects from various TFT-LCD panel manufacturers with which we have long been their strategic supplier in the display driver space."
Mr. Wu continued, "While the global financial crisis has had a profound impact on the TFT-LCD industry, we believe that it is a great opportunity for us to capitalize on our strategy and grow our business. Customers around the world are paying attention to suppliers' financial soundness, looking for industry's leaders who have sufficient resources to fund R&Ds, product developments, and customer services on a sustainable basis. Even amid the global economic downturn, our financial position has grown stronger over the past quarter. With no debts, our cash, cash equivalents and marketable securities available for sale were $204.6 million on March 31, 2009, a $55.5 million increase from the previous quarter. Backed by our strong balance sheet, we remain confident in the long-term growth prospects of our business and remain committed to adding value to our shareholders."
Mr. Wu continued, "On May 18th, our board approved an annual cash dividend of $0.30 per ordinary share which will be payable on June 29 to shareholders of record on June 22, 2009 and our books will be closed from June 15 to June 22, 2009."
Mr. Wu added, "We are seeing a strong, across the board rebound in the demand for our display drivers, as customers' capacity utilizations have been substantially improved. We expect rush orders to continue throughout the second quarter. For the second quarter, we expect revenues to grow 52% to 55% sequentially, gross margin to remain flat and GAAP earnings per share to be in the range of $0.07 to $0.09."
Reconciliation of gross margin (loss), operating margin (loss), net margin (loss) and diluted EPS excluding share-based compensation and acquisition-related charges, a non-GAAP financial measure, to GAAP gross margin (loss), GAAP operating margin (loss), GAAP net margin (loss) and diluted GAAP EPS, most comparable GAAP figure, is set out in the attached reconciliation schedule.
Investor Conference Call / Webcast Details
The Company's management will review detailed first quarter 2009 results on Monday, May 18, 2009 at 7:00 PM Eastern Daylight Time (7:00 AM, Tuesday, May 19, Taiwan time). The conference dial-in numbers are +1-201-689-8470 (international) and +1-877-407-9039 (U.S. domestic). A live webcast of the conference call will be available on the Company's website at www.himax.com.tw. The playback will be available beginning two hours after the conclusion of the conference call and will be accessible by dialing +1-201-612-7415 (international) and 1-877-660-6853 (U.S. domestic). The account number to access the replay is 3055 and the confirmation ID number is 320842.
About Himax Technologies, Inc.
Himax Technologies, Inc. designs, develops, and markets semiconductors that are critical components of flat panel displays. The Company's principal products are display drivers for large-sized TFT-LCD panels, which are used in desktop monitors, notebook computers and televisions, and display drivers for small- and medium-sized TFT-LCD panels, which are used in mobile handsets and consumer electronics products such as netbook computers, digital cameras, mobile gaming devices portable DVD players, digital photo frame and car navigation displays. In addition, the Company is expanding its product offering to include timing controllers, LCD TV chipset solutions, LCOS projector solutions, power management ICs and CMOS image sensors. Based in Tainan, Taiwan, the Company has regional offices in Hsinchu and Taipei, Taiwan; Ninbo, Foshan, Suzhou and Shenzhen, China; Yokohama, Japan; Anyangsi Kyungkido, and Matsusaka, South Korea; and Irvine California, USA.
Forward-Looking Statements:
Factors that could cause our actual results to differ materially include, but not limited to, those expressed or implied in these forward-looking statements for a variety of reasons, including, among other things and not limited to, our anticipated growth strategies, our future business developments, results of operations and financial condition, our ability to develop new products, the expected growth of the display driver markets, the expected growth of end-use applications that use flat panel displays, particularly TFT-LCD panels, development of alternative flat panel display technologies, our ability to collect accounts receivable and manage inventory, changes in economic and financial market conditions, and other risks described from time to time in the Company's SEC filings, including those risks identified in the section entitled "Risk Factors" in its Form 20-F for the year ended December 31, 2008 filed with SEC on dated May 15, 2009, as amended.
Himax Technologies, Inc.
Unaudited Condensed Consolidated Statements of Income
(These interim financials do not fully comply with US GAAP
because they omit all interim disclosure required by US GAAP)
(Amounts in Thousands of U.S. Dollars, Except Per Share Data)
Three Months
Three Months Ended
Ended March 31, December 31,
2009 2008 2008
--------- --------- ---------
Revenues
Revenues from third parties,
net $ 44,373 $ 77,461 $ 46,977
Revenues from related parties,
net 81,283 154,127 77,301
--------- --------- ---------
125,656 231,588 124,278
--------- --------- ---------
Costs and expenses:
Cost of revenues 99,441 172,949 98,186
Research and development 15,249 20,546 15,945
General and administrative 3,594 3,870 3,951
Bad debt expense 389 -- 25,297
Sales and marketing 2,160 2,558 2,179
--------- --------- ---------
Total costs and
expenses 120,833 199,923 145,558
--------- --------- ---------
Operating income (loss) 4,823 31,665 (21,280)
--------- --------- ---------
Non operating income (loss):
Interest income 282 777 900
Foreign exchange gains (losses),
net (1,415) 1,370 (603)
Other income (loss), net (138) 92 186
--------- --------- ---------
(1,271) 2,239 483
--------- --------- ---------
Earnings (loss) before income
taxes 3,552 33,904 (20,797)
Income tax expense
(benefit) 249 702 (6,992)
--------- --------- ---------
Net income (loss) 3,303 33,202 (13,805)
Net loss attributable to the
noncontrolling interests 1,066 935 649
--------- --------- ---------
Net income (loss) attributable
to Himax stockholders $ 4,369 $ 34,137 $ (13,156)
========= ========= =========
Basic earnings (loss) per
ordinary share and ADS $ 0.02 $ 0.18 $ (0.07)
========= ========= =========
Diluted earnings (loss) per
ordinary share and ADS $ 0.02 $ 0.18 $ (0.07)
========= ========= =========
Basic Weighted Average
Outstanding Shares 188,883 191,542 192,305
Diluted Weighted Average
Outstanding Shares 188,883 192,429 192,305
Himax Technologies, Inc.
Unaudited Supplemental Financial Information
(Amounts in Thousands of U.S. Dollars)
The amount of share-based
compensation included in
applicable statements of income
categories is summarized
as follows: Three Months
Three Months Ended
Ended March 31, December 31,
2009 2008 2008
------- ------- -------
Share-based compensation
Cost of revenues $ 13 $ 28 $ 14
Research and development 1,783 1,872 1,496
General and
administrative 272 233 207
Sales and marketing 274 241 208
Income tax benefit (101) -- (53)
------- ------- -------
Total $ 2,241 $ 2,374 $ 1,872
======= ======= =======
The amount of acquisition-related
charges included in applicable
statements of income categories
is summarized as follows:
Acquisition-related charges
Research and development $ 258 $ 240 $ 239
Sales and marketing 290 289 290
Income tax benefit (162) -- (162)
------- ------- -------
Total $ 386 $ 529 $ 367
======= ======= =======
Himax Technologies, Inc.
Unaudited Condensed Consolidated Balance Sheets
(Amounts in Thousands of U.S. Dollars, Except Per Share Data)
March 31, Dec. 31, March 31,
2009 2008 2008
----------- ----------- -----------
Assets
Current assets:
Cash and cash equivalents $ 200,678 $ 135,200 $ 125,835
Marketable securities
available-for-sale 3,919 13,870 15,216
Accounts receivable, less
allowance for doubtful
accounts, sales
returns and discounts 52,689 51,029 85,795
Accounts receivable from
related parties, less
allowance for doubtful
accounts, sales returns
and discounts 87,959 104,477 179,801
Inventories 63,908 96,921 122,437
Deferred income taxes 20,747 21,446 13,520
Prepaid expenses and
other current assets 9,973 11,707 9,420
----------- ----------- -----------
Total current
assets $ 439,873 $ 434,650 $ 552,024
----------- ----------- -----------
Property, plant and
equipment, net 53,542 55,111 46,523
Deferred income taxes 22,278 23,029 22,109
Goodwill 26,846 26,846 26,878
Intangible assets, net 10,417 10,965 12,185
Investments in
non-marketable securities 11,619 11,619 11,619
Refundable deposits
and prepaid pension costs 1,251 1,168 874
Other assets 3,186 2,160 2,049
----------- ----------- -----------
129,139 130,898 122,237
----------- ----------- -----------
Total assets $ 569,012 $ 565,548 $ 674,261
=========== =========== ===========
Liabilities and
Stockholders' Equity
Current liabilities:
Accounts payable $ 63,131 $ 53,720 $ 135,163
Income tax payable 15,355 15,455 20,875
Other accrued expenses
and other current
liabilities 15,761 22,455 19,106
----------- ----------- -----------
Total current
liabilities $ 94,247 $ 91,630 $ 175,144
Accrued pension
liabilities 200 214 233
Deferred income taxes 3,066 3,224 4,547
Income tax payable 459 474 231
----------- ----------- -----------
Total liabilities $ 97,972 $ 95,542 $ 180,155
----------- ----------- -----------
Himax stockholders' equity:
Ordinary shares,
US$0.0001 par value,
500,000,000 shares
authorized; 187,303,186,
190,119,594, and
190,905,649 shares
issued and outstanding
at March 31, 2009,
December 31, 2008,
and March 31, 2008,
respectively $ 19 $ 19 $ 19
Additional paid-in
capital 235,889 238,499 235,402
Accumulated other
comprehensive income
(loss) (71) (314) 849
Unappropriated
retained earnings 229,336 224,967 249,540
----------- ----------- -----------
Total Himax
stockholders'
equity $ 465,173 $ 463,171 $ 485,810
Noncontrolling interests 5,867 6,835 8,296
----------- ----------- -----------
Total equity $ 471,040 $ 470,006 $ 494,106
----------- ----------- -----------
Total liabilities and
stockholders' equity $ 569,012 $ 565,548 $ 674,261
=========== =========== ===========
Himax Technologies, Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
(Amounts in Thousands of U.S. Dollars)
Three
Months
Three Months Ended
Ended March 31, Dec. 31,
2009 2008 2008
-------- -------- --------
Cash flows from operating activities:
Net income (loss) attributable to
Himax stockholders $ 4,369 $ 34,137 $(13,156)
Adjustments to reconcile net income
(loss) attributable to Himax
stockholders to net cash provided by
operating activities:
Depreciation and amortization 3,196 2,939 3,210
Bad debt expense 389 -- 25,297
Share-based compensation expenses 2,342 2,374 1,925
Net loss attributable to the
noncontrolling interests (1,066) (935) (649)
Loss (gain) on disposal of property
and equipment 19 (7) 6
Gain on disposal of subsidiary shares,
net -- (6) (27)
Loss (gain) on disposal of marketable
securities, net 156 (64) (119)
Deferred income tax benefit 1,292 (2,167) (11,026)
Inventories write downs 3,976 5,099 3,359
Changes in operating assets and
liabilities:
Accounts receivable (2,049) 2,919 29,070
Accounts receivable from related
parties 16,509 15,105 41,197
Inventories 29,037 (10,923) 15,202
Prepaid expenses and other current
assets 498 5,953 3,677
Accounts payable 9,411 (12,083) (67,463)
Income tax payable (115) 1,960 3,430
Other accrued expenses and other
current liabilities (3,333) (109) (5,135)
-------- -------- --------
Net cash provided by operating
activities 64,631 44,192 28,798
-------- -------- --------
Cash flows from investing activities:
Purchase of property and equipment (3,097) (2,263) (9,364)
Proceeds from disposal of property and
equipment -- 29 3
Purchase of available-for-sale
marketable securities (6,552) (22,550) (21,487)
Disposal of available-for-sale
marketable securities 16,170 22,957 16,763
Proceeds from disposal of subsidiary
shares by Himax Technologies
Limited 106 9 56
Purchase of investments in
non-marketable securities -- (4,481) --
Purchase of subsidiary shares from the
noncontrolling interests (50) (29) (351)
Increase in refundable deposits (100) (26) (3)
Pledge of restricted marketable
securities (1,014) (1,952) (17)
-------- -------- --------
Net cash provided by (used in)
investing activities 5,463 (8,306) (14,400)
-------- -------- --------
Himax Technologies, Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
(Amounts in Thousands of U.S. Dollars)
Three
Months
Three Months Ended
Ended March 31, Dec. 31,
2009 2008 2008
-------- -------- --------
Cash flows from financing activities:
Proceeds from issuance of new shares
by subsidiaries $ 47 $ 89 $ 1,034
Payments to acquire ordinary shares
for retirement (5,072) (5,364) (3,195)
-------- -------- --------
Net cash used in financing activities (5,025) (5,275) (2,161)
-------- -------- --------
Effect of exchange rate changes on cash
and cash equivalents 409 444 (145)
-------- -------- --------
Net increase in cash and cash equivalents 65,478 31,055 12,092
Cash and cash equivalents at beginning
of period 135,200 94,780 123,108
-------- -------- --------
Cash and cash equivalents at end of
period $200,678 $125,835 $135,200
======== ======== ========
Supplemental disclosures of cash flow
information:
Cash paid during the period for income
taxes $ 26 $ 31 $ 517
======== ======== ========
Himax Technologies, Inc.
Unaudited Supplemental Data - Reconciliation Schedule
(Amounts in Thousands of U.S. Dollars)
Gross Margin, Operating Margin (Loss) and Net Margin (Loss) Excluding
Share-based Compensation and Acquisition-Related Charges:
Three
Months
Three Months Ended
Ended March 31, Dec. 31,
2009 2008 2008
-------- -------- ---------
Revenues $125,656 $231,588 $124,278
Gross profit 26,215 58,639 26,092
Add:Share-based compensation - Cost of
revenues 13 28 14
Gross profit excluding share-based
compensation 26,228 58,667 26,106
Gross margin excluding share-based
compensation 20.9% 25.3% 21.0%
Operating income (loss) 4,823 31,665 (21,280)
Add: Share-based compensation 2,342 2,374 1,925
Operating income (loss) excluding
share-based compensation 7,165 34,039 (19,355)
Add: Acquisition-related charges
-Intangible assets amortization 548 529 529
Operating income (loss) excluding
share-based compensation and
acquisition-related charges 7,713 34,568 (18,826)
Operating margin (loss) excluding
share-based compensation and
acquisition-related charges 6.1% 14.9% (15.1%)
Net income (loss) attributable to Himax
stockholders 4,369 34,137 (13,156)
Add: Share-based compensation, net of
tax 2,241 2,374 1,872
Add: Acquisition-related charges, net of
tax 386 529 367
Net income (loss) excluding share-based
compensation and acquisition-related
charges 6,996 37,040 (10,917)
Net margin (loss) excluding share-based
compensation and acquisition-related
charges 5.6% 16.0% (8.8%)
*Gross margin excluding share-based compensation equals gross profit
excluding share-based compensation divided by revenues
*Operating margin (loss) excluding share-based compensation and
acquisition-related charges equals operating income excluding
share-based compensation and acquisition-related charges divided by
revenues
*Net margin (loss) excluding share-based compensation and
acquisition-related charges equals net income excluding share-based
compensation and acquisition-related charges divided by revenues
Diluted Earnings Per Share Excluding Share-based Compensation and
Acquisition-Related Charges:
Three Months Ended
March 31, 2009
------------------
Diluted GAAP EPS $0.02
Add: Share-based compensation per diluted share $0.01
Add: Acquisition-related charges per diluted share $--
Diluted non GAAP EPS excluding share-based
compensation and acquisition-related charges $0.04
Numbers do not add up due to rounding