Investor Overview

Press Release

View printer-friendly version << Back
DSP Group Inc. Reports First Quarter 2003 Earnings
Revenues for the first quarter increased 37% YoY Net income for the first quarter increased 59% YoY

SANTA CLARA, Calif., Apr 21, 2003 /PRNewswire-FirstCall via COMTEX/ -- DSP Group, Inc. (Nasdaq: DSPG) today announced the results for the quarter ended March 31, 2003.

The company announced first quarter 2003 revenues of $29,011,000, an increase of 37% from revenues of $21,126,000 for the first quarter of 2002. Net income for the first quarter of 2003 was $4,267,000, an increase of 59% from $2,690,000 for the first quarter of 2002. Diluted earnings per share (EPS) for the first quarter of 2003 increased by 50% to $0.15, compared with $0.10, for the first quarter of 2002. Net income and diluted EPS for the first quarter of 2002 included the results of operations of the DSP cores licensing business, that was spun off, which amounted to $515,000 and $0.02 per share, respectively.

Eli Ayalon, Chairman and Chief Executive Officer of the company, stated: "We are very pleased with our first quarter 2003 results as we continued to grow our top line while maintaining a high profitability level. We also have good visibility into the second quarter of 2003."

Boaz Edan, Chief Operating Officer of the company, said: "The revenue growth was driven by new models of 2.4GHz chipsets shipped by our OEM customers and the initial shipments of a new chip with advanced technology that translates Caller ID Text into voice and enables a 'Talking Caller ID' functionality."

About DSP Group

DSP Group, Inc. is a fabless semiconductor company that is a leader in the short-range wireless market. By combining its DSP cores technology with advanced RF, communication technology and speech-processing algorithms, DSP Group is a worldwide leader in developing and providing short-range communication applications that include digital 900MHz, 2.4GHz, DECT (1.9GHz), 5.8GHz and Bluetooth for voice and data communication in residential, SOHO, SME, enterprise and automotive applications. DSP Group's products include advanced RF CMOS and communications technology. DSP Group also develops and markets embedded, integrated silicon/software solution for Voice-over-Digital- Subscriber Line (VoDSL) and Voice-over-Internet-Protocol (VoIP) applications, as well as other Voice-over-Packet applications for Integrated Access Device (IAD) and IP phone. More information about DSP Group is available at www.dspg.com.

This press release may contain statements that qualify as "forward-looking statements" under the Private Securities Litigation Reform Act of 1995, including statements made by Mr. Ayalon relating to good visibility into the second quarter of 2003. These forward-looking statements are based on current expectations and DSP Group assumes no obligation to update this information. In addition, the events described in these forward-looking statements may not actually arise. DSP Group's actual results could differ materially from those described in this press release as a result of various factors, including, the acceptance by customers of DSP Group's products, DSP Group's ability to differentiate its products from those of its competitors in the same market and the general market demand for products that incorporate DSP Group's technology in the market. These factors and other factors which may effect future operating results or DSP Group's stock price are discussed under "RISK FACTORS" in the Form 10-K for the year ended December 31, 2002, as well as other report, including Form 10-Qs, DSP Group has filed with the Securities and Exchange Commission and which are available on DSP Group's Web site (www.dspg.com) under Investor Relations.

     Earnings conference call

     DSP Group has scheduled a conference call for 8:00 a.m. EDT today to
     discuss first quarter results and invites you to listen to a live
     broadcast over the Internet. The broadcast can be accessed by all
     interested parties through the Investor Relations section (investor
     message board) of DSP Group's Web site at www.dspg.com or link to:
     http://www.dspg.com/ir/investor_messageb.html

For more information, please contact Yaniv Arieli, President of US Operations, Investor Relations, DSP Group at (408) 986-4423.


                               DSP GROUP, INC.
                      CONSOLIDATED STATEMENTS OF INCOME
                   (In thousands, except per share amounts)

                                                        Three Months Ended
                                                             March 31,
                                                         2003         2002
                                                      (Unaudited)  (Unaudited)

    Revenues                                           $29,011       $21,126
    Cost of revenues                                    16,777        12,612

    Gross profit                                        12,234         8,514
    Operating expenses:
      Research and development                           5,120         4,904
      Sales and marketing                                2,316         1,936
      General and administrative                         1,581           930
      Aborted spin off expenses and other                   --           865

      Total operating expenses                           9,017         8,635

    Operating income (loss)                              3,217          (121)
    Other income :
      Interest and other income, net                     1,924         2,609

    Income before taxes on income                        5,141         2,488

    Taxes on income                                        874           313

    Net income from continuing operations                4,267         2,175
    Net income from discontinued operations (*)             --           515

    Net income                                          $4,267        $2,690

    Net earnings per share for continuing operations:
      Basic                                              $0.16         $0.08
      Diluted                                            $0.15         $0.08

    Net earnings per share for discontinued operations:
      Basic                                              $0.00         $0.02
      Diluted                                            $0.00         $0.02
    Net earnings per share (combined):
      Basic                                              $0.16         $0.10
      Diluted                                            $0.15         $0.10
    Weighted average number of shares of common stock
     used in the computation of:
      Basic                                             27,324        26,951
      Diluted                                           28,428        28,059

(*) Related to the DSP cores licensing business (Ceva) which was discontinued in November 2002 following the combination with Parthus Technologies plc to form ParthusCeva, Inc.


                               DSP GROUP, INC.
                         CONSOLIDATED BALANCE SHEETS
                                (In thousands)


                                                      March 31,   December 31,
                                                          2003        2002
                                                      (Unaudited)  (Audited)
    Assets
    Current assets:
      Cash and cash equivalents                         $37,137     $39,919
      Marketable securities                              55,536      45,371
      Trade receivables, net                             11,359       4,873
      Inventories                                         6,290       6,916
      Other accounts receivable                           1,474       1,352
      Deferred income taxes                               1,685       1,685
      Assets of discontinued operation, net               2,665       4,737
    Total current assets                                116,146     104,853

    Property and equipment, net                           4,677       4,690
    Long term marketable securities                     147,026     150,692
    Investment in equity security of traded companies    12,231      12,031
    Other assets, net                                       381         386
    Severance pay fund                                    1,790       1,616
      Goodwill                                            5,804       5,804

    Total Assets                                       $288,055    $280,072

    Liabilities and Stockholders' Equity
    Current liabilities:
      Trade payable                                      $8,742      $6,745
      Other current liabilities                          22,203      21,552

    Total current liabilities                            30,945      28,297
    Long term liabilities:
    Accrued severance pay                                 1,832       1,686
    Deferred income taxes                                 2,470       2,371
    Total long term liabilities                           4,302       4,057

    Stockholders' equity:
      Common stock                                           27          27
      Additional paid-in capital                        157,267     156,443
      Less cost of treasury stock                           (85)         --
      Accumulated other comprehensive income                672         476
      Retained earnings                                  94,927      90,772
    Total stockholders' equity                          252,808     247,718

    Total liabilities and stockholders' equity         $288,055    $280,072

SOURCE DSP Group, Inc.

Yaniv Arieli, President of US Operations, Investor Relations, of DSP Group, +1-408-986-4423

Photo: http://www.newscom.com/cgi-bin/prnh/20020715/SFM118LOGO

AP Archive: http://photoarchive.ap.org

PRN Photo Desk, +1-888-776-6555 or +1-212-782-2840

http://www.dspg.com