DSP Group, Inc. Reports First Quarter 2014 Earnings
Financial Results Highlights:
-
Non-GAAP diluted EPS of
$0.03 and GAAP diluted LPS of$0.04 , exceeding guidance -
First quarter revenues of approximately
$32.9 million , above mid-point of guidance - Gross margins of 39.6%, at the high end of guidance
- Maintained positive non-GAAP operating income for the sixth consecutive quarter
-
Non-GAAP net income of
$0.8 million , representing eighth consecutive quarter of non-GAAP net income -
Repurchased 596,000 shares for a total consideration of
$5.3 million -
Net cash and cash equivalents of
$117 million
Management Comments:
Commenting on the results,
Mr. Elyakim added, "During the quarter we successfully met key milestones in our business plan, which will enable us to more meaningfully expand our reach beyond cordless telephony with new product offerings. One of our most important achievements was a major design win with a tier 1 OEM for VoIP products that will significantly expand our market footprint and revenue growth in the Office segment. We are well positioned to meet all the milestones we have set forth in our plan for this year and consequently achieve an inflection point in our business in 2015."
Products and Market Highlights:
-
Secured a major IP phone design win with a tier 1 OEM based on
DSP Group's DVF99 SoC -
Grandstream launched three new enterprise grade VoIP phones based on
DSP Group's DVF99 SoC -
Sercomm began shipments of its new home gateway to a tier 1 service provider based on our DECT CAT-iq SoC -
ProSyst,
Rockethome andDSP Group partner to offer end-to-end ULE-based home automation and security platform - Leading security service provider and a tier 1 OEM customer selected our DECT-ULE SoC to power their wireless security and safety offerings
2014 First Quarter Results
GAAP Results:
Revenues for the first quarter of 2014 were
Non-GAAP Results:
Non-GAAP net income and diluted earnings per share for the first quarter of 2014 were
Non-GAAP net income and earnings per share for the first quarter of 2013 excluded the impact of amortization of acquired intangible assets in the amount of
Earnings Conference Call Details:
Investors may access the conference call by dialing +1 877 280 1254 (domestic US) or +1 646 254 3388 (international) approximately 10 minutes prior to the starting time. The password is
A replay of the conference call will be available for a week following the call. To listen to the session, please dial +1 347 366 9565 (domestic US) or +44 203 427 0598 (international) and enter the company access code: 2226079#
Presentation on Non-GAAP Net Income Calculation
The Company believes that the non-GAAP presentation of net income and diluted EPS presented in this press release is useful to investors in comparing results for the quarter ended
Forward Looking Statements
This press release contains statements that qualify as "forward-looking statements" under the Private Securities Litigation Reform Act of 1995, including Mr. Elyakim's statement that the excess inventory depletion cycle experienced by
About
At the forefront of semiconductor innovation and operational excellence for over two decades,
For more information, visit www.dspg.com.
| DSP GROUP, INC. | ||
| CONSOLIDATED STATEMENTS OF INCOME | ||
| (In thousands, except per share amounts) | ||
| Three Months Ended | ||
| March 31, | ||
| 2014 | 2013 | |
| Unaudited | Unaudited | |
| Revenues | $ 32,886 | $ 39,650 |
| Cost of revenues | 19,872 | 23,944 |
| Gross profit | 13,014 | 15,706 |
| Operating expenses: | ||
| Research and development, net | 8,205 | 9,151 |
| Sales and marketing | 3,086 | 3,051 |
| General and administrative | 2,717 | 2,622 |
| Amortization of intangible assets | 397 | 418 |
| Total operating expenses | 14,405 | 15,242 |
| Operating income (loss) | (1,391) | 464 |
| Other income : | ||
| Financial income, net | 412 | 570 |
| Income (loss) before taxes on income | (979) | 1,034 |
| Taxes on income (income tax benefit) | 9 | (138) |
| Net income (loss) | $ (988) | $ 1,172 |
|
Net earnings (loss) per share: |
||
| Basic | $ (0.04) | $ 0.05 |
| Diluted | $ (0.04) | $ 0.05 |
| Weighted average number of shares used in per share computations of net income (loss) per share | ||
| Basic | 22,378 | 21,897 |
| Diluted | 22,378 | 22,246 |
| DSP GROUP, INC. | ||
| CONSOLIDATED STATEMENTS OF OPERATIONS (NON-GAAP) | ||
| (In thousands, except per share amounts) | ||
| Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures | ||
| (In thousands, except per share amounts) | ||
| Three Months Ended | ||
| March 31, | ||
| 2014 | 2013 | |
| Unaudited | Unaudited | |
| GAAP net income (loss) | $(988) | $1,172 |
| Equity-based compensation expense included in cost of revenues | 82 | 63 |
| Equity-based compensation expense included in research and development , net | 644 | 468 |
| Equity-based compensation expense included in sales and marketing | 162 | 135 |
| Equity-based compensation expense included in general and administrative | 555 | 377 |
| Amortization of intangible assets | 397 | 418 |
| Amortization of deferred tax liability related to intangible assets acquired in BoneTone acquisition | (97) | (97) |
| Non-GAAP net income | $ 755 | $ 2,536 |
| Weighted-average number of common stock used in computation of GAAP diluted net income (loss) per share (in thousands) | 22,378 | 22,246 |
| Weighted-average number of shares related to outstanding options, stock appreciation rights and restricted stock units (in thousands) | 1,631 | 373 |
| Weighted-average number of common stock used in computation of non-GAAP diluted net income (loss) per share (in thousands), | 24,009 | 22,619 |
| GAAP diluted net income (loss) per share | $ (0.04) | $ 0.05 |
| Equity-based compensation expense | 0.06 | 0.05 |
| Amortization of intangible assets | 0.02 | 0.02 |
| Amortization of deferred tax liability related to intangible assets acquired in BoneTone acquisition | (0.01) | (0.01) |
| Non-GAAP diluted net income per share | $ 0.03 | $ 0.11 |
| DSP GROUP, INC. | ||
| CONSOLIDATED BALANCE SHEETS | ||
| (In thousands) | ||
| March 31, | December 31, | |
| 2014 | 2013 | |
| (Unaudited) | (Audited) | |
| Assets | ||
| Current assets: | ||
|
Cash and cash equivalents Restricted deposits |
$ 14,464 67 |
$ 23,578 77 |
| Marketable securities and short term deposits | 13,458 | 13,895 |
| Trade receivables, net | 22,569 | 21,195 |
| Inventories | 12,193 | 12,334 |
| Other accounts receivable and prepaid expenses | 3,071 | 2,641 |
| Deferred income taxes | 90 | 92 |
| Total current assets | 65,912 | 73,812 |
| Property and equipment, net | 2,863 | 2,837 |
|
Long term marketable securities and deposits |
89,220 |
90,162 |
| Severance pay fund | 11,493 | 11,168 |
| Intangible assets, net | 11,589 | 11,986 |
| Investment in other companies | 2,200 | 2,200 |
| Long term prepaid expenses and lease deposits | 103 | 100 |
| 114,605 | 115,616 | |
| Total assets | $ 183,380 | $ 192,265 |
| Liabilities and Stockholders' Equity | ||
| Current liabilities: | ||
| Trade payables | $ 12,634 | $ 14,149 |
| Other current liabilities | 13,427 | 17,362 |
| Total current liabilities | 26,061 | 31,511 |
| Accrued severance pay | 11,517 | 11,179 |
| Accrued pensions | 988 | 981 |
| Deferred income taxes | 1,087 | 1,183 |
| Total long term liabilities | 13,592 | 13,343 |
| Stockholders' equity: | ||
| Common stock | 22 | 22 |
| Additional paid-in capital | 351,937 | 350,494 |
| Accumulated other comprehensive income | (943) | (821) |
| Less – Cost of treasury stock | (120,360) | (118,749) |
| Accumulated deficit | (86,929) | (83,535) |
| Total stockholders' equity | 143,727 | 147,411 |
| Total liabilities and stockholders' equity | $ 183,380 | $ 192,265 |
CONTACT:Christopher Basta , Director of Investor Relations Office: 1-408-240-6844 Cell: 1-631-796-5644 Email: chris.basta@dspg.com
