O2Micro Reports Second Quarter 2020 Financial Results
GEORGE TOWN, Grand Cayman, July 31, 2020 (GLOBE NEWSWIRE) --
Operational and Strategic Highlights:
Q2 2020 revenue was 17.3 Million, up 21.1% from the same quarter in the previous year and up 10.9% sequentially and within the range of guidance provided on May 8th, 2020.
GAAP net income per fully diluted ADS in the second quarter of 2020 was 1 cent, with non-GAAP net income of 3 cents per fully diluted ADS.
O2Micro expects the Q3 2020 revenue to be $17.6 million to $19.0 million compared to $16.0 million in the comparable quarter of the previous year.
O2Micro® International Limited (NASDAQ: OIIM), a global leader in the design, development and marketing of high-performance integrated circuits and solutions, reported its financial results today for the Second quarter ending June 30, 2020.
Financial Highlights for the Second Quarter ending June 30, 2020:
O2Micro International Limited (the “Company”) reported Q2 2020 revenue of $17.3 million. Revenue was up 10.9% sequentially, and up 21.1% from the same quarter in the previous year. The gross margin in the second quarter of 2020 was 51.2%, which was down from 51.9% in the prior quarter, and up from 50.1% in the second quarter of 2019. During the second quarter of 2020, the Company recorded total GAAP operating expenses of $9.5 million, compared to $8.7 million in the first quarter of 2020, and $9.7 million in the year-ago Q2 period. The GAAP operating margins for the second quarter of 2020, the first quarter of 2020, and second quarter of 2019 were (3.9%), (3.7%), and (18.1%), respectively.
GAAP net income was $380,000 in Q2 2020. This compares to a GAAP net loss of $1.5 million in the first quarter of 2020 and a GAAP net loss of $2.8 million in Q2 2019. GAAP net income per fully diluted ADS was $0.01 in Q2 2020. This compares to a GAAP net loss per fully diluted ADS of $0.06 in Q1 2020 and a GAAP net loss per fully diluted ADS of $0.11 in Q2 2019.
Supplementary Data:
The Company ended the second quarter of 2020 with $41.4 million in unrestricted cash and short-term investments or $1.53 per outstanding ADS. The accounts receivable balance was $11.7 million and represented 59 days sales outstanding at the end of Q2 2020. Inventory was $12.4 million or 119 days and turned over 3 times during Q2 2020. As of June 30, 2020, the Company had $53.2 million in working capital and the book value was $74.5 million, or $2.76 per outstanding ADS. As of June 30, 2020, O2Micro International Limited had a total of 289 employees worldwide, including 161 engineers.
Management Commentary:
“Our growth in the first half of 2020 has benefited from successful development of next-Gen products for Top Tier and OEM customers and a market focus on technologies supporting mobile and remote workforces, extended learning and in-home entertainment. Stay at home policies helped drive sales of higher end TV, monitors, power tools and electric bikes,” said Sterling Du, O2Micro’s Chairman and CEO. “We are optimistic that our business fundamentals are leading O2Micro back to long term profitability.”
Conference Call:
O2Micro will hold its Second quarter conference call on Friday July 31st, 2020, at 6:00AM. Pacific, 9:00AM Eastern. You may participate using the following dial-in information.
Conference ID: 9715102
Participants, Int'l Toll: +1 334-777-6978
Participants, US/CAN Toll Free: 800-367-2403
Live Webcast: https://ir.o2micro.com/events-and-presentations
The Call-in Audio Replay will be available following the call from July 31st, 2020 12:00PM Eastern Time (US & Canada) through August 12th, 2020 12:00PM Eastern Time (US & Canada) https://events.globalmeet.com/Public/WebRegistration/ZW5jPXNhQWNoekF6VkllUlY5eHpuVjRaVTR0KzYzNXJXVDRMNFIzcUF2RFcrcSt3WU5HZTN0M3lzQ1dnd1lMOXlFSlRqTXFMbHkxb3A0T0Y5b3BFOWNIOFJnPT0=
A online replay will be available on the website for one week.
About O2Micro:
Founded in April 1995, O2Micro develops and markets innovative power management components for the Computer, Consumer, Industrial, and Automotive markets. Products include Backlighting, Battery Management and Power Management. The Company maintains offices worldwide. Additional Company and product information can be found on the Company website at www.o2micro.com.
O2Micro, the O2Micro logo, and combinations thereof are registered trademarks of O2Micro. All other trademarks or registered trademarks are the property of their respective owners.
Statements made in this release that are not historical, including statements regarding O2Micro or its management's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal Securities Laws. Such statements involve risks, speculation and uncertainties that may cause actual results to differ materially from those set forth in these statements or from management's current views and expectations. Risks and uncertainties in this release may include, without limitation, any one or combination of the following: the effect of competitive and economic factors; real property value fluctuations and market demand; legal changes in any relevant rules and regulations pertaining to O2Micro's business; changes in technology and industry standards, and O2Micro's reaction to those factors; consumer and business buying decisions with respect to our customers' products incorporating O2Micro's products; continued competitive pressures in the marketplace; the ability of O2Micro to deliver to the marketplace, and stimulate customer demand therein, for new products and technological innovations on a timely basis; the effect that product introductions and transitions, changes in product pricing or mix, and/or increases in component costs could have on O2Micro's gross margins; the inventory risk associated with O2Micro's need to order, or commit to order, product components and product capacity in advance of forecast customer orders; the continued availability of acceptable terms of certain components and services essential to O2Micro's business which are currently obtained by the Company from sole or limited sources; the effect that O2Micro's dependency on manufacturing and logistics services provided by third parties may have on the quality, quantity, availability or cost of products manufactured or services rendered; risks associated with O2Micro's international operations; the potential impact of a finding that O2Micro has infringed on the intellectual property rights of others, or that any third party may have infringed on O2Micro's intellectual property that may negatively affect O2Micro's business; O2Micro's legal classifications with governmental and regulatory agencies; O2Micro's dependency on the performance of distributors, carriers, independent sales representatives, and other resellers of O2Micro's products; the effect that product and service quality problems could have on O2Micro's sales ability and operating profits; the ability of O2Micro to deliver its products in a timely fashion to its customers, and the possible negative ramifications if such is not possible; the continued service and availability of key executives and employees; war, terrorism, public health issues, natural disasters, and other circumstances that could disrupt supply, delivery, or demand of products; and unfavorable results of other legal proceedings. Actual results may differ materially due to numerous risk factors. Such risk factors are more fully enumerated in O2Micro's 20-F Annual Filings, Annual Report(s), 6-K's, the Form F-1 filed in connection with the Company's initial public offering in August 2000, information posted on our website at www.o2micro.com, and other documents filed with the SEC, NASDAQ or any other public agency from time to time. The statements herein are based on dated information on the dates mentioned herein, which is subject to change. O2Micro assumes no obligation to update or revise the information provided on today, or any other forward-looking information, whether as a result of new information, future events or any other information that may arise. This information only speaks to the respective dates mentioned in said information.
O2MICRO INTERNATIONAL LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)
(In Thousand U.S. Dollars, Except Per Share Amounts)
Three Months Ended | Six Months Ended | |||||||||||
June 30, | June 30, | |||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||
OPERATING REVENUES | $ | 17,284 | $ | 14,271 | $ | 32,865 | $ | 27,034 | ||||
COST OF REVENUES | 8,431 | 7,125 | 15,921 | 13,441 | ||||||||
GROSS PROFIT | 8,853 | 7,146 | 16,944 | 13,593 | ||||||||
OPERATING EXPENSES | ||||||||||||
Research and development (1) | 5,025 | 4,846 | 9,166 | 9,956 | ||||||||
Selling, general and administrative (1) | 4,503 | 4,879 | 9,024 | 9,835 | ||||||||
Total Operating Expenses | 9,528 | 9,725 | 18,190 | 19,791 | ||||||||
LOSS FROM OPERATIONS | (675 | ) | (2,579 | ) | (1,246 | ) | (6,198 | ) | ||||
NON-OPERATING INCOME | ||||||||||||
Interest income | 157 | 107 | 344 | 164 | ||||||||
Net gain (loss) recognized on long-term investments | 1,059 | (187 | ) | (41 | ) | (172 | ) | |||||
Foreign exchange (loss) gain – net | (92 | ) | 57 | (60 | ) | (84 | ) | |||||
Other – net | 193 | 112 | 310 | 253 | ||||||||
Total Non-operating Income | 1,317 | 89 | 553 | 161 | ||||||||
INCOME (LOSS) BEFORE INCOME TAX | 642 | (2,490 | ) | (693 | ) | (6,037 | ) | |||||
INCOME TAX EXPENSE | 262 | 290 | 467 | 589 | ||||||||
NET INCOME (LOSS) | 380 | (2,780 | ) | (1,160 | ) | (6,626 | ) | |||||
OTHER COMPREHENSIVE INCOME (LOSS) | ||||||||||||
Foreign currency translation adjustments | 164 | (302 | ) | (82 | ) | (133 | ) | |||||
Unrealized pension gain | 1 | 2 | 1 | 3 | ||||||||
Total Other Comprehensive Income (Loss) | 545 | (300 | ) | (81 | ) | (130 | ) | |||||
COMPREHENSIVE INCOME (LOSS) | $ | 545 | $ | (3,080 | ) | $ | (1,241 | ) | $ | (6,756 | ) | |
EARNINGS (LOSS) PER ADS | ||||||||||||
Basic | $ | 0.01 | $ | (0.11 | ) | $ | (0.04 | ) | $ | (0.25 | ) | |
Diluted | $ | 0.01 | $ | (0.11 | ) | $ | (0.04 | ) | $ | (0.25 | ) | |
ADS UNITS USED IN EARNINGS (LOSS) PER ADS CALCULATION: | ||||||||||||
Basic (in thousands) | 26,991 | 26,356 | 26,856 | 26,325 | ||||||||
Diluted (in thousands) | 27,726 | 26,356 | 26,856 | 26,325 | ||||||||
(1) INCLUDES STOCK-BASED COMPENSATION CHARGE AS FOLLOWS: | ||||||||||||
Research and development | $ | 67 | $ | 73 | $ | 147 | $ | 136 | ||||
Selling, general and administrative | $ | 260 | $ | 313 | $ | 577 | $ | 575 | ||||
O2MICRO INTERNATIONAL LIMITED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousand U.S. Dollars, Except Share Amounts)
June 30, | December 31, | |||||
2020 | 2019 | |||||
ASSETS | (Unaudited) | (Audited) | ||||
CURRENT ASSETS | ||||||
Cash and cash equivalents | $ | 12,676 | $ | 10,696 | ||
Restricted cash | 36 | 35 | ||||
Short-term investments | 28,684 | 35,693 | ||||
Accounts receivable – net | 11,730 | 10,335 | ||||
Inventories | 12,416 | 8,796 | ||||
Prepaid expenses and other current assets | 1,505 | 1,295 | ||||
Total Current Assets | 67,047 | 66,850 | ||||
LONG-TERM INVESTMENTS | 3,327 | 4,172 | ||||
PROPERTY AND EQUIPMENT – NET (1) | 15,150 | 15,551 | ||||
OTHER ASSETS | 5,484 | 2,426 | ||||
TOTAL ASSETS | $ | 91,008 | $ | 88,999 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||
CURRENT LIABILITIES | ||||||
Notes and accounts payable | $ | 7,834 | $ | 4,867 | ||
Income tax payable | 318 | 611 | ||||
Lease liabilities | 644 | 827 | ||||
Accrued expenses and other current liabilities | 5,090 | 4,839 | ||||
Total Current Liabilities | 13,886 | 11,144 | ||||
OTHER LONG-TERM LIABILITIES | ||||||
Accrued pension liabilities | 193 | 214 | ||||
Deferred income tax liabilities | 629 | 589 | ||||
Lease liabilities | 1,752 | 1,932 | ||||
Other liabilities | 66 | 65 | ||||
Total Other Long-Term Liabilities | 2,640 | 2,800 | ||||
Total Liabilities | 16,526 | 13,944 | ||||
COMMITMENTS AND CONTINGENCIES | ||||||
SHAREHOLDERS’ EQUITY | ||||||
Preference shares at $0.00002 par value per share | ||||||
Authorized – 250,000,000 shares | - | - | ||||
Ordinary shares at $0.00002 par value per share | ||||||
Authorized – 4,750,000,000 shares | ||||||
Issued – 1,669,036,600 shares as of June 30, 2020 and December 31, 2019 | 33 | 33 | ||||
Additional paid-in capital | 142,926 | 143,484 | ||||
Accumulated deficits | (53,987 | ) | (51,773 | ) | ||
Accumulated other comprehensive income | 4,573 | 4,654 | ||||
Treasury stock – 318,873,000 and 354,238,000 shares as of June 30, 2020 and | (19,063 | ) | (21,343 | ) | ||
Total Shareholders’ Equity | 74,482 | 75,055 | ||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 91,008 | $ | 88,999 | ||
(1) Property and equipment- net includes right-of-used assets under operating lease of $2,358 as of June 30, 2020.
CONTACT: O2Micro Daniel Meyberg Investor Relations ir@o2micro.com
