-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CjHRsmDLNZ4V/1kBsKNTKJHIT3co5mIKiKzD3AFOSgHgP+JeLqhY3HvJy1s+QJA5 8db7SH59rBzdlRMZNbESWQ== 0000891092-03-003318.txt : 20031113 0000891092-03-003318.hdr.sgml : 20031113 20031113112634 ACCESSION NUMBER: 0000891092-03-003318 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031113 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20031113 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SRS LABS INC CENTRAL INDEX KEY: 0001016470 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 330714264 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21123 FILM NUMBER: 03996389 BUSINESS ADDRESS: STREET 1: 2909 DAIMIER ST CITY: SANTA ANA STATE: CA ZIP: 92705 BUSINESS PHONE: 9494421070 MAIL ADDRESS: STREET 1: 2909 DAIMLER ST CITY: SANTA ANA STATE: CA ZIP: 92705 8-K 1 e16227_8k.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): November 13, 2003 SRS LABS, INC. (Exact Name of registrant as specified in its charter) Delaware 0-21123 33-0714264 -------- ------- ---------- (State or other jurisdiction of (Commission File Number) (IRS Employer incorporation) Identification No.) 2909 Daimler Street Santa Ana, California 92705 --------------------- ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (949) 442-1070 Not Applicable (Former name or former address, if changed since last report) Item 7. Financial Statements and Exhibits. Exhibit No. Description - ----------- ----------- 99 Press Release, dated as of November 13, 2003. Item 12. Results of Operations and Financial Condition. On November 13, 2003, SRS Labs, Inc. (the "Company") issued a press release announcing its operating results for the three and nine months ended September 30, 2003. Attached as Exhibit 99 to this report is a copy of the Company's press release, which is incorporated herein by reference. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. SRS LABS, INC, a Delaware corporation Date: November 13, 2003 By: /S/ THOMAS C. K. YUEN ------------------------------------------------- Thomas C. K. Yuen Chairman of the Board and Chief Executive Officer -2- EX-99 3 e16227ex99.txt PRESS RELEASE Exhibit 99 SRS Labs Reports 2003 Third Quarter Results Company Reports Quarterly Earnings Per Share of $0.01 and Year-to-Date Earnings Per Share of $0.01 SANTA ANA, Calif., Nov. 13 /PRNewswire-FirstCall/ -- SRS Labs, Inc. (Nasdaq: SRSL), a leading provider of audio, voice and semiconductor technology solutions, today reported financial results for its third quarter and nine months ended September 30, 2003. For the three months ended September 30, 2003, the company reported consolidated revenue of $4,886,394, a decrease of 9.7 percent over consolidated revenue of $5,411,613, for the same quarter in 2002. For the quarter ended September 30, 2003, the company reported a net income of $118,826, or $0.01 earnings per share, compared to a net income of $595,774, or $0.05 earnings per share, for the same period last year. Technology licensing revenues decreased 8 percent over the same quarter last year and semiconductor revenues decreased 2 percent over the same period in 2002. Consolidated gross margin improved to 75 percent for the quarter ended September 30, 2003, compared to 72 percent for the same period last year. For the nine months ended September 30, 2003, the company reported consolidated revenue of $13,882,614, an increase of 6.8 percent over consolidated revenue of $12,995,353, for the same period in 2002. For the nine months ended September 30, 2003, the company reported a net income of $127,478, or $0.01 earnings per share, compared to a net income of $109,597 or $0.01 earnings per share, for the same period last year. The company's cash and investments position totaled $21.9 million on September 30, 2003. Janet Biski, chief financial officer of SRS Labs said, "As we have previously noted in our financial filings, one of the risks associated with our licensing business is product and customer concentration. From time to time, certain original equipment manufacturer (OEM) and semiconductor manufacturer customers may account for a significant portion of revenue from a particular product application. In the third quarter of 2003, licensing revenues were adversely affected by the decision of one of our manufacturing customers who accounted for a significant portion of the company's licensing revenues from the sales of DVD players, to discontinue the use of our technologies in the traditional DVD player segment because of pricing pressures in the DVD market. We were able to offset a majority of the decrease in the third quarter as a result of revenues generated from new product categories and the increased penetration of SRS Labs' technologies in our home theater market. These revenues reflect upon the company's strategy to diversify its customer base." Biski continued, "Our gross margins for our ASIC business decreased four percent from last year, reflecting competitive pricing in the semiconductor market. In addition, our operating expenses grew as a result of our promotional investments to support our OEMs, and diversification into new markets. We also made investments in R&D to develop new technologies and semiconductor solutions in all of our key markets." Thomas C. K. Yuen, SRS Labs' chairman and CEO, said: "In the third quarter, we saw the positive results of our strategy to diversify our licensing and semiconductor businesses, even as revenues decreased from last year. We developed new chip solutions with our patented audio, voice and surround sound technologies for sale to manufacturers in the Asia Pacific region. Our licensing efforts are focused on continuing the diversification of our customer base and expanding our technology offerings across new semiconductor platforms, such as ST Microelectronics and PacketVideo, to service a larger portion of the consumer electronics marketplace." Some key highlights for the quarter ended September 30, 2003 include: -- Home Theater & Consumer Audio - Expanded relationship with Philips Semiconductor for the global TV market, and Samsung, Sampo, and Nakamichi for the fast-growing flat panel TV segment -- Portable and Wireless Devices - Announced an agreement with NEC for mobile phones and formed partnerships with Intel, ARM, and PacketVideo for portable and wireless devices -- ValenceTech - Design wins with Sony and Philips for ASP standard chips featuring SRS technologies Yuen continued, "I am pleased with the initial signs of success in our diversification strategy. We feel that the strong foundation we are building this year will help insulate us against product and customer concentration issues and put us in a better position to capitalize on opportunities in growing markets, such as cell phones and flat panel TVs." In conjunction with SRS Labs' (Nasdaq: SRSL) third quarter results, investors will have the opportunity to listen to the conference call live online through the investor section of the SRS website or through the following links: http://www.firstcallevents.com/service/ajwz392961981gf12.html or http://www.vcall.com/CEPage.asp?ID=85116 today, November 13, 2003 at 3pm EDT or link to the conference from the Investor section of SRS Labs' website at www.srslabs.com. About SRS Labs, Inc. Celebrating a decade in audio technology innovation, SRS Labs has become a recognized leader in the advancement of audio and voice technology. The company works with the world's top manufacturers to provide a richer entertainment experience through patented sound techniques. SRS Labs' technologies can be heard through products ranging from televisions, DVD players, cell phones, car audio systems and computers. The company also offers hardware and software tools to professionals and consumers for the production and broadcast of content featuring SRS Labs' technologies. SRS Labs' wholly owned subsidiary, ValenceTech, is located in Hong Kong and provides custom ASICs and standard ICs to leading manufacturers worldwide. Based in Santa Ana, Calif., the company also has licensing representation in Hong Kong, Japan, Europe, and Korea. For more information about SRS Labs, Inc. please visit www.srslabs.com. The information on the above-referenced websites is not incorporated by reference into this press release. Except for historical information contained in this release, statements in this release, including those of Mr. Yuen and Ms. Biski, are forward-looking statements and projections (which include statements concerning plans and objectives of management for future operations) that are based on management's belief, as well as assumptions made by, and information currently available to, management. While the Company believes that its expectations are based upon reasonable assumptions, there can be no assurances that the Company's goals and strategy will be realized. Numerous factors (including risks and uncertainties) may affect the Company's actual results and may cause results to differ materially from those expressed in forward-looking statements made by or on behalf of the Company. Some of these factors include the general market conditions concerning the overall semiconductor business, the acceptance of new SRS Labs' products and technologies, the impact of competitive products and pricing, the timely development and release of technologies by the Company, product and customer concentration risks, general business and economic conditions, especially in Asia, and other factors detailed in the Company's Form 10-K and other periodic reports filed with the SEC. SRS Labs specifically disclaims any obligation to update or revise any forward-looking statement whether as a result of new information, future developments or otherwise. Investor Contact: Tami Yanito (949) 442-1070 x 3093 tami@srslabs.com. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2003 2002 2003 2002 Revenues: Licensing $1,854,707 $2,008,554 $6,441,297 $5,240,117 Semiconductor 2,884,248 2,945,687 7,063,008 6,782,127 Other 147,439 457,372 378,309 973,109 Total revenues 4,886,394 5,411,613 13,882,614 12,995,353 Cost of sales 1,242,436 1,505,290 2,812,569 3,413,450 Gross margin 3,643,958 3,906,323 11,070,045 9,581,903 Operating expenses: Sales and marketing 1,216,568 995,759 3,840,155 3,188,978 Research and development 1,032,100 992,839 3,083,438 2,895,436 General and administrative 1,143,930 1,272,031 3,668,573 3,385,737 Total operating expenses 3,392,598 3,260,629 10,592,166 9,470,151 Income from operations 251,360 645,694 477,879 111,752 Other income, net 131,925 295,332 414,655 611,882 Minority interest -- 19,178 5,430 59,208 Income before income tax expense 383,285 960,204 897,964 782,842 Income tax expense 264,459 364,430 770,486 673,245 Net income $118,826 $595,774 $127,478 $109,597 Net income per common share: Basic $0.01 $0.05 $0.01 $0.01 Diluted $0.01 $0.05 $0.01 $0.01 Weighted average shares used in the calculation of net income per common share: Basic 13,076,315 12,623,339 12,956,971 12,659,347 Diluted 14,730,290 12,758,058 13,729,676 12,903,526 CONDENSED CONSOLIDATED BALANCE SHEETS Sept. 30, 2003 Dec. 31, 2002 (unaudited) ASSETS Current Assets Cash and cash equivalents $11,290,949 $15,720,860 Accounts receivable, net 1,155,884 1,074,421 Inventories, net 948,816 807,382 Prepaid expenses and other current assets 607,365 462,442 Deferred income taxes 36,147 36,147 Total Current Assets 14,039,161 18,101,252 Investments available for sale 10,687,813 6,630,771 Furniture, fixtures & equipment, net 1,741,506 1,935,424 Goodwill, net 1,173,102 533,031 Intangible assets, net 1,889,577 1,957,359 Deferred income taxes 172,318 149,498 Total Assets $29,703,477 $29,307,335 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts payable $1,164,736 $1,011,032 Accrued liabilities 1,204,232 2,347,702 Income taxes payable 591,806 341,172 Total Current Liabilities 2,960,774 3,699,906 Minority interest -- 325,371 Commitments and contingencies Stockholders' Equity Preferred stock - $.001 par value; 2,000,000 shares authorized; no shares issued or outstanding -- -- Common stock - $.001 par value; 56,000,000 shares authorized; 13,364,198 and 12,876,314 shares issued; and 13,138,898 and 12,651,014 shares outstanding at September 30, 2003 and December 31, 2002, respectively 13,365 12,877 Additional paid in capital 57,366,350 55,966,589 Accumulated other comprehensive loss (155,646) (88,564) Accumulated deficit (29,762,765) (29,890,243) Treasury stock at cost, 225,300 shares at September 30, 2003 and at December 31, 2002 (718,601) (718,601) Total Stockholders' Equity 26,742,703 25,282,058 Total Liabilities and Stockholders' Equity $29,703,477 $29,307,335 SOURCE SRS Labs, Inc. -0- 11/13/2003 /CONTACT: investors, Tami Yanito of SRS Labs, Inc., +1-949-442-1070, ext. 3093, tami@srslabs.com/ /Web site: http://www.srslabs.com/ (SRSL) CO: SRS Labs, Inc. ST: California IN: CPR CSE HRD STW SEM SU: ERN CCA -----END PRIVACY-ENHANCED MESSAGE-----