Revenue and Operating Income for the Quarter Increased 33% & 108% YoY, Respectively
SANTA CLARA, Calif., April 21 /PRNewswire-FirstCall/ -- DSP Group, Inc. (Nasdaq: DSPG) today announced its results for the quarter ended March 31, 2004.
Revenues for the first quarter of 2004 were $38,708,000, an increase of 33% from revenues of $29,011,000 for the first quarter of 2003. Net income for the first quarter of 2004 was $20,114,000, as compared to $4,267,000 for the first quarter of 2003. Diluted earnings per share (EPS) for the first quarter of 2004 were $0.66, as compared to $0.15 for the first quarter of 2003.
Results for the first quarter of 2004 included a capital gain of $20,827,000 resulting from the sale of two million shares of the AudioCodes Ltd. stock and a capital gain of $490,000 resulting from the sale of all of the Company's holdings in the Tomen Corporation stock, both during the first quarter of 2004. These capital gains are included under "Other Income (expense)" in the Company's statements of income. DSP Group still holds approximately 2.45 million shares of the AudioCodes stock.
Pro forma net income and diluted EPS for the first quarter of 2004, excluding the effect of the one-time capital gains described above and the related taxes of $8,517,000, would have been $7,314,000 and $0.24, respectively. The Company achieved an increase of 71% and 60% for pro forma net income and diluted EPS, respectively, as compared to the same period in 2003.
Eli Ayalon, Chairman and CEO of DSP Group, stated: "We are very pleased with our financial and business achievements in the first quarter of 2004. We continue to see strong demand for our products, resulting in strong revenues in the first quarter and good visibility into the second quarter of 2004. The outlook for the rest of the year is positive, and we are encouraged by the positive reaction to our new products for the European market."
About DSP Group
DSP Group, Inc. is a fabless semiconductor company, offering complex Integrated Circuit (IC) solutions. DSP Group is a world leader in the short-range wireless communication market, enabling home networking convergence for voice, video & data. By combining its in-house technologies of Digital Signal Processors, portfolio of wireless communication protocols, including DECT and Bluetooth, most advanced Radio Frequency CMOS and SiGe, as well as VoIP ICs, DSP Group is a world leader and a one-stop-shop for a wide range of applications. These applications include: ISM band digital 900MHz, 2.4GHz and 5.8GHz telephony; European DECT (1.9GHz) telephony; and Bluetooth systems for voice, data and video communication, which are employed in residential, SOHO, SME, enterprise and automotive applications. DSP Group's ICs provide solutions for MP3 players, VoIP phones, gateways, and Integrated Access Devices (IADs) and are widely used in Digital Voice Recorders (DVRs). 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 continuing strong demand for DSP Group's products, the positive outlook for the second quarter of 2004 and the rest of the year, and the positive reaction to DSP Group's new products for the European market. 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 unexpected delays in the introduction of new products; failure to achieve broad market acceptance of existing and new products by existing and potential OEM customers; DSP Group's inability to add new customers and develop and produce new products at competitive costs and in a timely manner; decline or fluctuations in gross margins and the effect on revenues and profitability; and general market demand for products that incorporate DSP Group's technology in the market. These factors and other factors which may affect 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, 2003, as well as other reports, 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 8:30 a.m. EDT today to discuss the financial results for the first quarter of 2004 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://phx.corporate-ir.net/phoenix.zhtml?c=101665&p=irol-necalendar .
If you cannot join the call, please listen to the replay, which will be available for approximately two weeks after the call on DSP Group's Web site or by calling the following numbers:
-- US Dial-In # 1-888-286-8010 (passcode: 68232467)
-- International Dial-In # 617-801-6888 (passcode: 68232467)
CONTACT: Yaniv Arieli, President of US Operations, Investor Relations of DSP Group Inc., +1-408-986-4423, or firstname.lastname@example.org.
DSP GROUP, INC. CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) Three Months Ended March 31, 2004 2003 Product revenues and other $38,708 $29,011 Cost of product revenues and other 19,858 16,777 Gross profit 18,850 12,234 Operating expenses: Research and development 7,554 5,120 Sales and marketing 2,803 2,316 General and administrative 1,806 1,581 Total operating expenses 12,163 9,017 Operating income 6,687 3,217 Other income: Interest and other income, net 2,125 1,924 Capital gains 21,317 -- Income before provision for income taxes 30,129 5,141 Provision for income taxes 10,015 874 Net income $20,114 $4,267 Net earnings per share: Basic $0.70 $0.16 Diluted $0.66 $0.15 Weighted average number of shares of Common Stock used in the computation of: Basic 28,767 27,324 Diluted 30,698 28,428 DSP GROUP, INC. CONSOLIDATED BALANCE SHEETS (In thousands) March 31, December 31, 2004 2003 Assets (Unaudited) (Audited) Current assets: Cash and cash equivalents $81,467 $36,812 Marketable securities and cash deposit 27,324 42,490 Trade receivables, net 15,061 15,844 Inventories 9,022 8,466 Other accounts receivable 1,106 1,462 Deferred income taxes 1,326 1,326 Total current assets 135,306 106,400 Property and equipment, net 6,959 7,108 Long term marketable securities 208,005 197,071 Investment in equity securities of traded companies 28,428 47,138 Severance pay fund 2,608 2,360 Long term pre-paid expenses and lease deposits 544 513 Goodwill 5,804 5,804 Other intangible assets 1,923 2,076 Total assets $389,577 $368,470 Liabilities and Stockholders' Equity Current liabilities: Trade payable $17,556 $11,221 Other current liabilities 39,267 34,292 Total current liabilities 56,823 45,513 Long term liabilities: Accrued severance pay 2,690 2,555 Long term liability 1,429 1,429 Deferred income taxes 9,784 14,592 Total long term liabilities 13,903 18,576 Stockholders' equity: Common Stock 29 29 Additional paid-in capital 177,350 174,700 Accumulated other comprehensive income 14,127 23,045 Retained earnings 127,345 107,799 Loss - Cost of treasury stock -- (1,192) Total stockholders' equity 318,851 304,381 Total liabilities and stockholders' equity $389,577 $368,470 (Logo: http://www.newscom.com/cgi-bin/prnh/20020715/SFM118LOGO )
SOURCE DSP Group, Inc.
CONTACT: Yaniv Arieli, President of US Operations, Investor Relations of DSP Group Inc., +1-408-986-4423, or email@example.com