Actions Semiconductor Co., Ltd. ADS, Each Representing Six Ordinary Shares (NASDAQ:ACTS)
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Company's Share Repurchase Program Extended Through 2009
ZHUHAI, People's Republic of China, Oct. 30 /PRNewswire-FirstCall/ -- Actions Semiconductor Co., Ltd. (NASDAQ:ACTS), one of China's leading fabless semiconductor companies that provides comprehensive mixed-signal system-on-a-chip (SoC) and multimedia digital signal processing (DSP) solutions for portable consumer electronics, today reported financial results for the third quarter ended September 30, 2008.
All financial results are reported on a U.S. GAAP basis.
Revenue for the third quarter of 2008 was $27.3 million, as compared to revenue of $26.6 million for the second quarter of 2008, and $27.0 million for the third quarter of 2007.
Net income for the third quarter of 2008 was $7.4 million, or $0.09 per ADS, compared to $7.7 million, or $0.09 per ADS for the second quarter of 2008, and compared to $10.3 million, or $0.12 per ADS for the third quarter of 2007.
Actions Semiconductor reported gross margin of 50.7% and operating margin of 20.9% for the third quarter of 2008. The Company ended the quarter with $53.3 million in cash and cash equivalents together with time deposits. Marketable securities and trading securities at the end of the quarter were $204.9 million.
The Company also announced that its board of directors authorized a one-year extension of the share repurchase program for up to eight million of its American Depositary Shares (ADSs) representing 48 million ordinary shares. The extended term of the repurchase program will expire on December 31, 2009. At the end of third quarter, the Company had invested approximately $12.9 million in the program, representing over 3.2 million ADSs. The repurchased shares are used in connection with the Company's employee benefit plans and other general corporate purposes. At the end of the third quarter of 2008, the Company had approximately 83 million outstanding ADSs.
The Company may repurchase shares in the open market or through privately negotiated transactions. The timing and actual number of ADSs repurchased will depend upon market conditions and other factors, in accordance with Securities and Exchange Commission requirements.
"During the third quarter, we operated under increasingly difficult macroeconomic conditions," commented Nan-Horng Yeh, Chief Executive Officer of Actions Semiconductor. "Despite the challenging market dynamics, sales and gross margin were in line with our expectations for the quarter. We continued to aggressively market our complete product portfolio worldwide and further developed our relationships with brand name and international customers. Our diverse product portfolio has enabled us to protect our leading market position in a sector characterized by intense competition."
"We remain dedicated to aggressively managing our business through this difficult time, as we focus on our long-term growth opportunities and tightly manage expenses. Given our strong cash position, we believe we are well equipped to weather this period of economic weakness. We continue to be proud of our management team for their commitment to maintaining profitability, generating strong cash flow and sustaining attractive margin levels," concluded Mr. Yeh.
Business Outlook
The following statements are based upon management's current expectations. These statements are forward-looking, and actual results may differ materially. The company undertakes no obligation to update these statements.
For the fourth quarter ended December 31, 2008, Actions Semiconductor estimates revenue in the range of $18 to $22 million, and fully diluted earnings per ADS of $0.04 to $0.06. The fourth quarter 2008 estimates include share-based compensation expense in the range of $0.9 to $1.0 million.
Conference Call Details
Actions Semiconductor's third quarter teleconference and webcast is scheduled to begin at 5:30 p.m. Eastern Time, on Thursday, October 30, 2008. To participate in the live call, analysts and investors should dial 866-383-8119 (within U.S.) or 617-597-5344 (outside U.S.) and enter passcode 54017534 at least ten minutes prior to the call. Actions Semiconductor will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the company's website at http://www.actions-semi.com/. An audio replay of the call will be available to investors through November 6, 2008, by dialing 888-286-8010 (within U.S.) or 617-801-6888 (outside U.S.) and entering the passcode 52920202.
About Actions Semiconductor
Actions Semiconductor is one of China's leading fabless semiconductor companies that provides mixed-signal and multimedia SoC solutions for portable consumer electronics. Actions Semiconductor products include SoCs, firmware, software, solution development kits, as well as detailed specifications of other required components and the providers of those components. Actions Semiconductor also provides total product and technology solutions that allow customers to quickly introduce new portable consumer electronics to the mass market in a cost effective way. The company is headquartered in Zhuhai, China, with offices in Shanghai, Beijing and Shenzhen. For more information, please visit the Actions Semiconductor website at http://www.actions-semi.com/.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995
Statements contained in this release that are not historical facts are forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements, including financial projections and forecasts, involve risks and uncertainties that could cause Actions Semiconductor's actual results to differ materially from our current expectations. Factors that could cause Actions Semiconductor's results to differ materially from those set forth in these forward-looking statements include customers' cancellation or modification of their orders; our failure to accurately forecast demand for our products; the loss of, or a significant reduction in orders from, any of our significant customers; fluctuations in our operating results; our inability to develop and sell new products; defects in or failures of our products; the expense and uncertainty involved in our customer design-win efforts; the financial viability of the distributors of our products; consumer demand; worldwide economic and political conditions; fluctuations in our costs to manufacture our products; our reliance on third parties to manufacture, test, assemble and ship our products; our ability to retain and attract key personnel; our ability to compete with our competitors; and our ability to protect our intellectual property rights and not infringe the intellectual property rights of others. Other factors that may cause our actual results to differ from those set forth in the forward-looking statements contained in this press release and that may affect our prospects in general are described in our filings with the Securities and Exchange Commission, including our most recently filed Forms F-1, 20-F and 6-Ks. Actions Semiconductor undertakes no obligation to update or revise forward-looking statements to reflect subsequent events or changed assumptions or circumstances.
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED BALANCE SHEET
(in thousands of U.S. dollars)
At September 30, At June 30, At December 31,
2008 2008 2007
(unaudited) (unaudited)
ASSETS
Current assets:
Cash and cash equivalents 53,286 126,745 72,054
Time deposits 62 266 2,613
Restricted cash 6,860 775 1,782
Marketable securities 195,565 139,973 165,317
Trading securities 9,339 - -
Accounts receivable, net 8,885 5,674 6,046
Notes receivable 206 194 372
Inventories 7,992 7,400 12,542
Prepaid expenses and other
current assets 2,463 2,659 2,479
Deferred tax assets 996 902 739
Total current assets 285,654 284,588 263,944
Other investments 7,338 7,330 7,760
Rental deposits 87 86 79
Property, plant and equipment,
net 7,221 6,683 6,436
Land use right 1,596 1,589 1,509
Acquired intangible assets,
net 4,782 5,510 5,849
Deposit paid for acquisition
of property, plant and
equipment 35 - 27
Deposit paid to establish an
investment 10,239 - -
Deferred tax assets 220 233 -
TOTAL ASSETS 317,172 306,019 285,604
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities:
Accounts payable 7,268 8,318 12,334
Accrued expenses and other
current liabilities 12,101 6,946 9,435
Other liabilities 1,046 496 884
Loan from minority
shareholder 1,500 1,500 -
Short-term bank loan - - 1,519
Income tax payable 556 565 749
Deferred tax liabilities 176 82 -
Total current liabilities 22,647 17,907 24,921
Other liabilities 294 729 686
Deferred tax liabilities 1,391 917 -
Total liabilities 24,332 19,553 25,607
Minority interest 140 174 204
Shareholders' equity:
Ordinary shares 1 1 1
Additional paid-in capital 38,784 41,592 43,679
Accumulated other
comprehensive income 21,496 19,680 9,628
Retained earnings 232,419 225,019 206,485
Total shareholders' equity 292,700 286,292 259,793
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY 317,172 306,019 285,604
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED INCOME STATEMENT
(in thousands of U.S. dollars, except per share amounts)
Three months Three months Nine months Nine months
ended ended ended ended
September 30, September 30, September 30, September 30,
2008 2007 2008 2007
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues 27,298 27,043 79,077 84,297
Cost of revenues (13,455) (13,024) (38,546) (41,700)
Gross profit 13,843 14,019 40,531 42,597
Other operating
income 59 8 636 380
Operating expenses:
Research and
development (4,842) (3,681) (14,430) (8,938)
General and
administrative (2,932) (2,837) (7,653) (8,105)
Selling and
marketing (419) (470) (1,245) (1,222)
Total operating
expenses (8,193) (6,988) (23,328) (18,265)
Income from operations 5,709 7,039 17,839 24,712
Other income(expense) (784) 1,757 1,628 4,398
Dividend income 20 - 20 -
Fair value change in
trading securities 48 - 48 -
Interest income 3,421 1,695 8,766 5,189
Interest expense - (20) (4) (62)
Income before income
taxes, equity in net
income(loss) of
an affiliate and
minority interests 8,414 10,471 28,297 34,237
Income tax (1,048) (305) (2,424) (1,705)
Equity in net
income(loss) of an
affiliate - 67 - 103
Minority interests 34 53 61 145
Net income 7,400 10,286 25,934 32,780
Net income per share:
Basic and diluted per
share: 0.01 0.02 0.05 0.06
Basic and diluted
(per ADS) 0.09 0.12 0.31 0.38
Weighted-average
shares used in
computation:
Basic and
diluted 501,332,494 512,972,522 505,195,617 514,866,876
Weighted-average
ADS used in
computation:
Basic and
diluted 83,555,416 85,495,420 84,199,270 85,811,146
Note: Stock-based
compensation
recorded in each
expense
classification
above is as
follows:
Cost of revenues 46 - 66 -
Research and
development 573 - 821 -
General and
administrative 272 - 389 -
Selling and
marketing 52 - 75 -
ACTIONS SEMICONDUCTOR CO., LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars)
Three months Nine months Nine months
ended ended ended
September September September
30, 2008 30, 2008 30, 2007
(unaudited) (unaudited) (unaudited)
Operating activities:
Net income 7,400 25,934 32,780
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization of
property, plant and equipment 525 1,518 1,167
Amortization of acquired intangible
assets 870 2,444 1,621
Loss on disposal of property, plant
and equipment 1 63 317
Gain on disposal of intangible
assets - - (18)
Gain on disposal of other
investment - (6) -
Dividend income (20) (20) -
Fair value of the stock options 943 1,351 -
Minority interests (34) (64) (146)
Equity in net loss of an affiliate - - (103)
Fair value change in trading
securities (48) (48) -
Changes in operating assets and
liabilities:
Accounts receivable (3,206) (2,834) (913)
Notes receivable (10) 183 1,200
Inventories (521) 5,274 (4,556)
Prepaid expenses and other
current assets 217 681 3,375
Amount due from an affiliate - 52 67
Accounts payable (1,134) (5,799) (8,822)
Accrued expenses and other
current liabilities 4,936 (497) (4,544)
Income tax payable (15) (244) (1,716)
Rental deposits - (3) 8
Deferred taxes 495 1,100 20
Net cash provided by operating
activities 10,399 29,085 19,737
Investing activities:
Dividend from other investment 20 20 -
Deposit paid to establish an
investment (10,239) (10,239) -
Increase in other investment (50) (165) (3,937)
Proceeds from disposal of property,
plant and equipment 18 18 39
Proceeds from disposal of
intangible assets - - 64
Increase in marketable securities (54,166) (19,023) (74,942)
Purchase of trading securities (26,402) (26,402) -
Proceeds from disposal of trading
securities 17,111 17,111 -
Purchase of property, plant and
equipment (1,049) (1,906) (2,356)
Purchase of intangible assets (369) (977) (3,999)
Increase in restricted cash (6,077) (4,998) (2,997)
Decrease in time deposits 206 2,690 32,314
Cash used in investing activities (80,997) (43,871) (55,814)
Financing activities:
Proceeds from short-term bank loans - - 1,431
Repayment of short-term bank loans - (1,580) -
Proceeds from loan from minority
shareholder - 1,500 (10)
Advance subsidy from local
authorities of Zhuhai, the PRC 104 (334) 182
Repurchase of ordinary shares (3,751) (6,246) (3,808)
Cash used in financing activities (3,647) (6,660) (2,205)
Effect of exchange rate changes on
cash 786 2,678 1,601
Net decrease in cash and cash
equivalents (73,459) (18,768) (36,681)
Cash and cash equivalents at the
beginning of the period 126,745 72,054 137,778
Cash and cash equivalents at the end
of the period 53,286 53,286 101,097
DATASOURCE: Actions Semiconductor Co., Ltd.
CONTACT: Investors, Lisa Laukkanen of The Blueshirt Group,
+1-415-217-4967, , for Actions Semiconductor Co., Ltd.;
or Ernie Huang, Investor Relations of Actions Semiconductor, +86 756 3392353,
ext. 1095,
Web site: http://www.actions-semi.com/