O2Micro Reports Fourth Quarter Financial Results

Feb 3, 2010
O2Micro Reports Fourth Quarter Financial Results

O2Micro Reports Fourth Quarter Financial Results

 

GEORGE TOWN, Grand Cayman, Feb 3, 2010 (GlobeNewswire via COMTEX) -- O2Micro® International Limited (Nasdaq:OIIM) reported its financial results today for the fourth quarter and fiscal year 2009, ending December 31, 2009.

Financial Results for the Fourth Quarter ending 12/31/2009:

O2Micro International reported Q4 2009 GAAP revenue of $33.1 million. Q4 revenue increased by 46% compared with the year-ago quarter. During the fourth quarter of 2009, the company also reported a gross profit of $20.1 million with a corresponding gross margin of 60.6%. The recent quarter compares favorably with the year-ago period when the company reported a gross profit of $12.6 million with a gross margin of 55.6%.

Fourth quarter GAAP operating expenses were $19.0 million in 2009, compared to $19.5 million in the fourth quarter of 2008. During the fourth quarter of 2008, the company incurred a write-off of $2.8 million for goodwill impairment and there was no comparable expense in Q4 2009. The GAAP operating margin was 3.4% in Q4 2009, compared to (30.3%) in Q4 2008.

Net non-operating income was $170,000 in Q4 2009, compared to ($277,000) in Q4 2008. Income taxes were $320,000 and $715,000 in the fourth quarters of 2009 and 2008, respectively. GAAP net income (loss) was $962,000 in the fourth quarter of 2009, compared to ($7.9) million in the fourth quarter of 2008. GAAP net income (loss) per full-diluted ADS was 0.03 and ($0.21) during the fourth quarters of 2009 and 2008, respectively.

Financial Results for the Fiscal Year ending 12/31/2009:

For the fiscal year ending December 31, 2009, O2Micro International reported revenue of $127.5 million. This was down 8.2% from 2008 revenue of $138.8 million. Gross profit was $75.5 million in 2009, compared to $80.7 million in 2008. The gross margin was 59.2% in 2009, up from 58.1% in 2008.

GAAP operating expenses were $78.1 million in 2009 and represented 61.2% of revenue. This compares to $80.2 million and 57.7% of revenue in 2008. During 2008, GAAP operating expenses included a one time gain of $2 million of litigation income, in addition to one-time expenses of $2.8 million for goodwill impairment and $2.9 million for the write-off of prepaid foundry services. GAAP income (loss) from operations was ($2.6) million in 2009, compared to $564,000 in 2008. The corresponding GAAP operating margins were (2.0%) and 0% for 2009 and 2008, respectively.

Net non-operating income (loss) was $1.4 million in 2009, compared to ($12.1) million in 2008. During 2008, the company incurred a one-time impairment loss of $14.1 million on long-term investments that was included in the net non-operating loss. Income tax expense was $1.6 million in 2009 and $2.2 million in 2008. These results yielded GAAP net losses of $2.8 million and $13.8 million during 2009 and 2008, respectively. The GAAP net losses per ADS were $0.08 and $0.37 for 2009 and 2008, respectively.

Supplementary Data:

The company ended the fourth quarter of 2009 with $113.3 million in unrestricted cash and short-term investments or $3.13 per ADS. The accounts receivable balance was $14.6 million and represented 40 days sales outstanding at the end of the Q4 2009. Inventory was $9.5 million and turned over 5.1 times during Q4 2009. As of 12/31/09, the company had $124.0 million in working capital and the book value was $179.4 million, or $4.96 per ADS.

As of December 31st 2009, O2Micro International also counted 850 employees, including 536 engineers.

Management Commentary:

Sterling Du, Chairman and CEO, commented, "Our fourth quarter showed sustained improvement and we were pleased to achieve 46% year-to-year growth. We have met all the challenges of this economy and we are looking forward to a year of growth and increasing profitability in 2010."

Conference Call: O2Micro will hold its fourth quarter conference call on February 3, 2010 at 5:00 a.m. PST, 8:00 a.m. EST. You may participate using the following dial-in information.

  In the U.S. and CANADA:           800-946-0706, passcode #4392341
  INTERNATIONAL participants:       719-457-2653, passcode #4392341

A replay of the call will be available by phone until February 10, 2010 using the following dial-in information.

  In the U.S. and CANADA:           888-203-1112, passcode #4392341
  INTERNATIONAL participants:       719-457-0820, passcode #4392341

A live simulcast will also be available on the company website at www.o2micro.com, and an online replay will be available on the website for one week.

About O2Micro

Founded in April 1995, O2Micro develops and markets innovative power management and security components for the Computer, Consumer, Industrial, and Communications markets. Products include Intelligent Lighting, Battery Management, Power Management, and SmartCardBus® products.

O2Micro International maintains an extensive portfolio of intellectual property with 13,404 patent claims granted, and over 15,000 more pending. 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, SmartCardBus, and combinations thereof are registered trademarks of O2Micro. All other trademarks are the property of their respective owners.

The O2Micro International Limited logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6567

                   O2MICRO INTERNATIONAL LIMITED AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
                (In Thousand U.S. Dollars, Except Per Share Amounts)


                                      Three Months Ended         Years Ended
                                         December 31,            December 31,
                                    ----------------------  ----------------------

                                       2009         2008       2009         2008
                                    -----------  ---------  -----------  ---------
                                         (Unaudited)        (Unaudited)  (Audited)
  NET SALES                             $33,119    $22,692     $127,498   $138,825


  COST OF SALES                          13,037     10,070       52,020     58,110
                                    -----------  ---------  -----------  ---------


  GROSS PROFIT                           20,082     12,622       75,478     80,715
                                    -----------  ---------  -----------  ---------

  OPERATING EXPENSES (INCOME)
  Research and development (1)            8,554      8,398       33,017     37,424
  Selling, general and
   administrative (1)                    10,416      8,312       45,049     39,003
  Goodwill impairment                        --      2,782           --      2,782
  Write-off of prepayment to
   foundry services                          --         --           --      2,942

  Litigation income                          --         --           --    (2,000)
                                    -----------  ---------  -----------  ---------

  Total Operating Expenses               18,970     19,492       78,066     80,151
                                    -----------  ---------  -----------  ---------


  INCOME (LOSS) FROM OPERATIONS           1,112    (6,870)      (2,588)        564
                                    -----------  ---------  -----------  ---------

  NON-OPERATING INCOME (LOSS)
  Interest income                           162        618        1,319      2,328
  Foreign exchange gain (loss) --
   net                                     (11)        110           28      (412)
  Impairment loss on long-term
   investments                               --    (1,073)           --   (14,146)

  Other -- net                               19         68           26         97
                                    -----------  ---------  -----------  ---------
  Total Non-operating Income
   (Loss)                                   170      (277)        1,373   (12,133)
                                    -----------  ---------  -----------  ---------

  INCOME (LOSS) BEFORE INCOME TAX         1,282    (7,147)      (1,215)   (11,569)


  INCOME TAX EXPENSE                        320        715        1,602      2,240
                                    -----------  ---------  -----------  ---------

  NET INCOME (LOSS)                         962    (7,862)      (2,817)   (13,809)

  OTHER COMPREHENSIVE INCOME
   (LOSS)
  Foreign currency translation
   adjustments                               30      (331)          287      1,466
  Unrealized gain (loss) on
   available-for-sale securities          1,073        939        2,006    (3,776)

  Unrealized pension gain (loss)              4      (123)            9      (123)
                                    -----------  ---------  -----------  ---------
  Total Other Comprehensive Income
   (Loss)                                 1,107        485        2,302    (2,433)
                                    -----------  ---------  -----------  ---------


  COMPREHENSIVE INCOME (LOSS)            $2,069   $(7,377)       $(515)  $(16,242)
                                    ===========  =========  ===========  =========

  EARNINGS (LOSS) PER SHARE:

  Basic                                 $0.0005  $(0.0043)    $(0.0015)  $(0.0074)
                                    ===========  =========  ===========  =========

  Diluted                               $0.0005         NA           NA         NA
                                    ===========  =========  ===========  =========

  EARNINGS (LOSS) PER ADS

  Basic                                   $0.03    $(0.21)      $(0.08)    $(0.37)
                                    ===========  =========  ===========  =========

  Diluted                                 $0.03         NA           NA         NA
                                    ===========  =========  ===========  =========

  SHARES USED IN EARNINGS (LOSS)
   PER SHARE CALCULATION:

  Basic (in thousands)                1,829,049  1,832,744    1,840,995  1,862,831
                                    ===========  =========  ===========  =========

  Diluted (in thousands)              1,861,404  1,834,501    1,865,876  1,869,218
                                    ===========  =========  ===========  =========

  ADS UNITS USED IN EARNINGS
   (LOSS) PER ADS CALCULATION:

  Basic (in thousands)                   36,581     36,655       36,820     37,257
                                    ===========  =========  ===========  =========

  Diluted (in thousands)                 37,228     36,690       37,318     37,384
                                    ===========  =========  ===========  =========

  (1) INCLUDES STOCK-BASED
   COMPENSATION CHARGE AS FOLLOWS:
  Research and development                 $267       $237       $1,180     $1,067
  Selling, general and
   administrative                          $543       $344       $2,215     $1,621


       O2MICRO INTERNATIONAL LIMITED AND SUBSIDIARIES
                CONSOLIDATED BALANCE SHEETS
     (In Thousand U.S. Dollars, Except Share Amounts)


                                    December     December
                                    31, 2009     31, 2008
                                   -----------  ---------
                                   (Unaudited)  (Audited)
  ASSETS

  CURRENT ASSETS
  Cash and cash equivalents            $38,831    $31,844
  Restricted cash                          236      1,153
  Short-term investments                74,502     72,344
  Accounts receivable -- net            14,556     10,578
  Inventories                            9,457     16,388
  Prepaid expenses and other
   current assets                        3,342      2,314
                                   -----------  ---------
  Total Current Assets                 140,924    134,621

  LONG-TERM INVESTMENTS                 15,190     13,199

  PROPERTY AND EQUIPMENT -- NET         30,570     34,353

  OTHER ASSETS
  Restricted assets -- net               1,443      1,411
  Intangible assets                      4,266      4,929

  Other Assets                           4,921      4,760
                                   -----------  ---------


  TOTAL ASSETS                        $197,314   $193,273
                                   ===========  =========

  LIABILITIES AND SHAREHOLDERS'
   EQUITY

  CURRENT LIABILITIES
  Notes and accounts payable            $8,760     $4,120
  Income tax payable                       411        226
  Accrued expenses and other
   current liabilities                   7,731      8,269
                                   -----------  ---------
  Total Current Liabilities             16,902     12,615

  OTHER LONG-TERM LIABILITIES
  Accrued pension liabilities              498        553
  FIN 48 tax liabilities                   341        302

  Other liabilities                        129         23
                                   -----------  ---------
  Total Other Long-Term
   Liabilities                             968        878


  Total Liabilities                     17,870     13,493
                                   -----------  ---------

  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 -- 1,809,461,200 and
      1,832,788,400 shares as of
      December 31, 2009 and 2008,
      respectively                          36         37
  Additional paid-in capital           142,679    141,784
  Retained earnings                     33,214     36,746
  Accumulated other comprehensive
   income                                3,515      1,213
                                   -----------  ---------

  Total Shareholders' Equity           179,444    179,780
                                   -----------  ---------

  TOTAL LIABILITIES AND
   SHAREHOLDERS' EQUITY               $197,314   $193,273
                                   ===========  =========

This news release was distributed by GlobeNewswire, www.globenewswire.com

SOURCE: O2Micro International Limited

CONTACT:  O2Micro International Limited
Gary E. Abbott, Director of Investor Relations
408.987.5920, x8888
gary.abbott@o2micro.com