EX-99.1 2 a11-6632_1ex99d1.htm EX-99.1

Exhibit 99.1

 

 

OMNIVISION REPORTS RECORD REVENUES AND EARNINGS

FOR THIRD QUARTER OF FISCAL 2011

 

~ Third Quarter Revenues Grow 10.9% Sequentially and 69.3% Year-Over-Year ~

 

SANTA CLARA, Calif., — February 24, 2011 — OmniVision Technologies, Inc. (Nasdaq: OVTI), a leading developer of advanced digital imaging solutions, today reported financial results for the fiscal third quarter ended January 31, 2011.

 

Revenues for the third quarter of fiscal 2011 were $265.7 million, as compared to $239.5 million in the second quarter of fiscal 2011, and $156.9 million in the third quarter of fiscal 2010. GAAP net income attributable to OmniVision Technologies, Inc. in the third quarter of fiscal 2011 was $44.7 million, or $0.75 per diluted share, as compared to net income attributable to OmniVision Technologies, Inc. of $28.9 million, or $0.50 per diluted share in the second quarter of fiscal 2011, and net income attributable to OmniVision Technologies, Inc. of $5.0 million, or $0.09 per diluted share in the third quarter of fiscal 2010.

 

Non-GAAP net income attributable to OmniVision Technologies, Inc. in the third quarter of fiscal 2011 was $51.0 million, or $0.84 per diluted share. Non-GAAP net income attributable to OmniVision Technologies, Inc. in the second quarter of fiscal 2011 was $34.2 million, or $0.58 per diluted share. Non-GAAP net income attributable to OmniVision Technologies, Inc. in the third quarter of fiscal 2010 was $10.8 million, or $0.20 per diluted share. Non-GAAP net income attributable to OmniVision Technologies, Inc. excludes stock-based compensation expenses and the related tax effects. Please refer to the attached schedule for a reconciliation of GAAP net income attributable to OmniVision Technologies, Inc. to non-GAAP net income attributable to OmniVision Technologies, Inc. for the three and nine months ended January 31, 2011 and 2010 and for the three months ended October 31, 2010.

 

Gross margin for the third quarter of fiscal 2011 was 29.8%, as compared to 28.2% for the second quarter of fiscal 2011 and 24.6% for the third quarter of fiscal 2010. Benefitting from record demand for its products, the sequential increase in the Company’s third quarter gross margin reflected the favorable impact of an increase in revenues recorded on the sale of previously written-down inventory combined with a reduction in inventory valuation allowances. The Company ended the period with cash, cash equivalents and short-term investments totaling $498.9  million, an increase of $102.2 million from the previous quarter.

 


 

“For the second consecutive quarter we achieved record revenues, which exceeded the high point of our guidance. This accomplishment underscores the best-in-class performance of our image sensor technology and the resultant demand,” stated Shaw Hong, chief executive officer of OmniVision Technologies, Inc. “With our recent announcement at the GSMA Mobile World Conference, we also delivered on our continuing commitment to drive industry-leading technology when we introduced our most advanced 8-megapixel image sensor built on our second-generation BSI technology, the OmniBSI-2tm architecture.”

 

Outlook

 

Based on current trends, the Company expects fiscal fourth quarter 2011 revenues will be in the range of $240 million to $260 million and GAAP net income per share attributable to OmniVision Technologies, Inc. common stockholders will be between $0.48 and $0.61 per diluted share. Excluding the estimated expense and related tax effects associated with stock-based compensation, the Company expects its non-GAAP net income per share attributable to OmniVision Technologies, Inc. common stockholders will be between $0.57 and $0.70 per diluted share. Refer to the table below for a reconciliation of GAAP to non-GAAP net income.

 

Conference Call

 

OmniVision Technologies will host a conference call today at 5:00 p.m. Eastern time to discuss these results further. This conference call can be accessed via a webcast at www.ovt.com. The call can also be accessed by dialing 866-730-5769 (domestic) or 857-350-1593 (international) and entering passcode 30380177.

 

A replay of the call will remain available at www.ovt.com for approximately twelve months. A replay of the call will also be available for one week beginning approximately one hour after the conclusion of the call. To access the replay, dial 888-286-8010 (domestic) or 617-801-6888 (international) and enter passcode 18896387.

 

About OmniVision

 

OmniVision Technologies, Inc. is a leading developer of advanced digital imaging solutions. Its CameraChip™ and CameraCube™ products using CameraCube™, OmniBSI™, OmniBSI-2™, OmniPixel®, OmniPixel2™, OmniPixel3™ and OmniPixel3-HS™ technologies are highly integrated, single-chip CMOS image sensors for consumer and commercial applications including mobile phones, notebooks and webcams, security and surveillance systems, digital still and video cameras, entertainment devices, automotive and medical imaging systems. Additional information is available at www.ovt.com.

 


 

Safe Harbor Statement

 

Certain statements in this press release, including statements relating to the Company’s expectations regarding revenues and earnings per share for the three months ending April 30, 2011 are forward-looking statements. These forward-looking statements are based on management’s current expectations, and certain factors could cause actual results to differ materially from those in the forward-looking statements. These factors include, without limitation, the impact of general economic conditions; the Company’s ability to accurately forecast customer demand for its products; fluctuations of wafer manufacturing yields, manufacturing capacity and other manufacturing processes; the potential loss of one or more key customers or distributors; the continued growth and development of current markets and the emergence of new markets in which the Company sells, or may sell, its products; competition in current and emerging markets for image sensor products, including pricing pressures that could result from competition; fluctuations in sales mix and average selling prices; the Company’s ability to obtain design wins from various image sensor device manufacturers including manufacturers of mobile phone, laptops and PCs, digital still cameras and automobile manufacturers; the market acceptance of products into which the Company’s products are designed; the development, production, introduction and marketing of new products and technology; the acceptance of the Company’s products in such current and new markets; the Company’s strategic investments and relationships, and other risks detailed from time to time in the Company’s Securities and Exchange Commission filings and reports, including, but not limited to, the Company’s most recent Annual Report on Form 10-K and recent Quarterly Reports on Form 10-Q. The Company expressly disclaims any obligation to update information contained in any forward-looking statement.

 

Use of Non-GAAP Financial Information

 

To supplement the reader’s overall understanding both of its reported results presented in accordance with U.S. generally accepted accounting principles (“GAAP”) and its outlook, the Company also presents non-GAAP measures of net income and net income  per share which are adjusted from results based on GAAP. In particular, the Company excludes stock-based compensation expense and the related tax effects. The non-GAAP financial measures which the Company discloses also exclude the effects of stock-based compensation on the number of basic and diluted common shares used in calculating non-GAAP basic and diluted net income per share. The Company provides these non-GAAP financial measures to enhance an investor’s overall understanding of its current financial performance and to assess its prospects for the future. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company’s operations that, when viewed with its GAAP results and the accompanying reconciliations to the corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting the Company’s business. The economic basis for the Company’s decision to use non-GAAP financial measures is that the adjustments to net income did not reflect the on-going relative strength of the Company’s performance. The Company’s objective is to minimize any confusion in the financial markets by providing non-GAAP net income and non-GAAP net income per share measurements and disclosing the related components. These non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the financial measures prepared in accordance with GAAP.

 


 

The Company uses non-GAAP financial measures for internal management purposes to conduct and evaluate its business, when publicly providing its business outlook and to facilitate period-to-period comparisons. The Company views non-GAAP net income per share as a primary indicator of the profitability of its underlying business. In addition, because stock-based compensation is a non-cash expense and is offset in full by a credit to paid-in capital, it has no effect on total stockholders’ equity. As the calculation of non-GAAP financial measures differ between companies, the non-GAAP financial measures used by the Company may not be comparable to similarly titled measures used by other companies. Other than stock-based compensation, these differences may cause the Company’s non-GAAP measures to not be directly comparable to other companies’ non-GAAP measures. Although these non-GAAP financial measures adjust cost, expenses and basic and diluted share items to exclude the accounting treatment of stock-based compensation, they should not be viewed as a non-GAAP presentation reflecting the elimination of the underlying stock-based compensation programs. Thus, the Company’s non-GAAP presentations are not intended to present, and should not be used, as a basis for assessing what its operating results might be if it were to eliminate its stock-based compensation programs. The Company compensates for these limitations by providing full disclosure of the net income attributable to OmniVision Technologies, Inc. and net income per share attributable to OmniVision Technologies, Inc. common stockholders on a basis prepared in accordance with GAAP to enable investors to consider net income attributable to OmniVision Technologies, Inc. and net income per share attributable to OmniVision Technologies, Inc. common stockholders determined under GAAP as well as on an adjusted basis, and perform their own analysis, as appropriate. As a result of the foregoing limitations, the Company does not use, nor does the Company intend to use, the non-GAAP financial measures when assessing the Company’s performance against that of other companies.

 

Estimating stock-based compensation expense and the related tax effects for a future period is subject to inherent risks and uncertainties, including but not limited to the price of the Company’s stock, stock market volatility, expected option life, risk-free interest rates, and the number of option exercises and sales during the quarter.

 

OMNIVISION TECHNOLOGIES, INC.

 

RECONCILIATION OF GUIDANCE FOR GAAP NET INCOME PER DILUTED SHARE

TO PROJECTED NON-GAAP NET INCOME PER DILUTED SHARE

(unaudited)

 

 

 

Three Months Ending April 30, 2011

 

 

 

GAAP
Range of Estimates

 

 

 

Non-GAAP
Range of Estimates

 

 

 

From

 

To

 

Adjustment

 

From

 

To

 

Net income per share attributable to OmniVision Technologies, Inc. common stockholders

 

$

0.48

 

$

0.61

 

$

0.09

(1)

$

0.57

 

$

0.70

 

 

(1)          Reflects estimated adjustment for expense and related tax effects associated with stock-based compensation.

 


 

OMNIVISION TECHNOLOGIES, INC.

 

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

(unaudited)

 

 

 

January 31,

 

April 30,

 

 

 

2011

 

2010

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

375,425

 

$

234,023

 

Short-term investments

 

123,470

 

99,555

 

Accounts receivable, net of allowances for doubtful accounts and sales returns

 

119,079

 

74,261

 

Inventories

 

93,569

 

133,993

 

Refundable and deferred income taxes

 

10,209

 

1,990

 

Prepaid expenses and other current assets

 

7,313

 

9,380

 

Total current assets

 

729,065

 

553,202

 

Property, plant and equipment, net

 

115,402

 

121,547

 

Long-term investments

 

101,688

 

92,121

 

Goodwill

 

1,122

 

439

 

Intangibles, net

 

6,268

 

4,891

 

Other long-term assets

 

18,218

 

25,493

 

Total assets

 

$

971,763

 

$

797,693

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

98,333

 

$

85,487

 

Accrued expenses and other current liabilities

 

16,185

 

19,506

 

Deferred revenues, less cost of revenues

 

16,619

 

10,661

 

Current portion of long-term debt

 

4,312

 

4,286

 

Total current liabilities

 

135,449

 

119,940

 

Long-term liabilities:

 

 

 

 

 

Long-term income taxes payable

 

84,283

 

90,626

 

Non-current portion of long-term debt

 

42,584

 

45,428

 

Other long-term liabilities

 

13,464

 

4,727

 

Total long-term liabilities

 

140,331

 

140,781

 

Total liabilities

 

275,780

 

260,721

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

OmniVision Technologies, Inc. stockholders’ equity:

 

 

 

 

 

Common stock, $0.001 par value; 100,000 shares authorized; 69,345 shares issued and 56,804 outstanding at January 31, 2011 and 64,616 shares issued and 52,075 outstanding at April 30, 2010, respectively

 

69

 

65

 

Additional paid-in capital

 

512,097

 

441,077

 

Accumulated other comprehensive income

 

1,724

 

870

 

Treasury stock, 12,541 shares at January 31, 2011 and April 30, 2010, respectively

 

(178,683

)

(178,683

)

Retained earnings

 

360,776

 

270,253

 

Total OmniVision Technologies, Inc. stockholders’ equity

 

695,983

 

533,582

 

Noncontrolling interest

 

—

 

3,390

 

Total equity

 

695,983

 

536,972

 

Total liabilities and equity

 

$

971,763

 

$

797,693

 

 


 

OMNIVISION TECHNOLOGIES, INC.

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)

(unaudited)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

January 31,

 

January 31,

 

 

 

2011

 

2010

 

2011

 

2010

 

Revenues

 

$

265,677

 

$

156,935

 

$

698,208

 

$

445,839

 

Cost of revenues

 

186,464

 

118,396

 

499,593

 

339,668

 

Gross profit

 

79,213

 

38,539

 

198,615

 

106,171

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Research, development and related

 

23,109

 

20,414

 

64,235

 

57,699

 

Selling, general and administrative

 

15,444

 

15,587

 

44,514

 

45,956

 

Total operating expenses

 

38,553

 

36,001

 

108,749

 

103,655

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

40,660

 

2,538

 

89,866

 

2,516

 

Interest expense, net

 

(318

)

(145

)

(952

)

(593

)

Other income, net

 

1,768

 

2,881

 

2,840

 

3,672

 

Income before income taxes

 

42,110

 

5,274

 

91,754

 

5,595

 

 

 

 

 

 

 

 

 

 

 

Provision for (benefit from) income taxes

 

(2,608

)

467

 

1,263

 

2,616

 

Net income

 

44,718

 

4,807

 

90,491

 

2,979

 

Net loss attributable to noncontrolling interest

 

—

 

(143

)

(32

)

(199

)

Net income attributable to OmniVision Technologies, Inc.

 

$

44,718

 

$

4,950

 

$

90,523

 

$

3,178

 

 

 

 

 

 

 

 

 

 

 

Net income per share attributable to OmniVision Technologies, Inc. common stockholders:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.80

 

$

0.10

 

$

1.66

 

$

0.06

 

Diluted

 

$

0.75

 

$

0.09

 

$

1.56

 

$

0.06

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing net income per share attributable to OmniVision Technologies, Inc. common stockholders:

 

 

 

 

 

 

 

 

 

Basic

 

56,174

 

51,273

 

54,541

 

50,870

 

Diluted

 

59,936

 

52,554

 

58,205

 

52,007

 

 


 

OMNIVISION TECHNOLOGIES, INC.

 

RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME

(in thousands, except per share amounts)

(unaudited)

 

 

 

Three Months Ended

 

Nine Months Ended

 

Three Months
Ended

 

 

 

January 31,

 

January 31,

 

October 31,

 

 

 

2011

 

2010

 

2011

 

2010

 

2010

 

GAAP net income attributable to OmniVision Technologies, Inc.

 

$

44,718

 

$

4,950

 

$

90,523

 

$

3,178

 

$

28,867

 

Add:

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation in cost of revenues

 

472

 

758

 

1,527

 

2,190

 

522

 

Stock-based compensation in research, development and related expenses

 

2,350

 

2,595

 

7,406

 

7,753

 

2,492

 

Stock-based compensation in selling, general and administrative expenses

 

2,015

 

2,671

 

6,161

 

8,282

 

2,108

 

(Increase) decrease in provision for income taxes without the effect of stock-based compensation

 

1,435

 

(134

)

1,999

 

(152

)

251

 

Non-GAAP net income attributable to OmniVision Technologies, Inc.

 

$

50,990

 

$

10,840

 

$

107,616

 

$

21,251

 

$

34,240

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP provision for income taxes

 

$

(2,608

)

$

467

 

$

1,263

 

$

2,616

 

$

2,090

 

(Increase) decrease in provision for income taxes without the effect of stock-based compensation

 

1,435

 

(134

)

1,999

 

(152

)

251

 

Non-GAAP provision for (benefit from) income taxes

 

$

(4,043

)

$

601

 

$

(736

)

$

2,768

 

$

1,839

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP net income per share attributable to OmniVision Technologies, Inc. common stockholders:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.91

 

$

0.21

 

$

1.97

 

$

0.42

 

$

0.63

 

Diluted

 

$

0.84

 

$

0.20

 

$

1.83

 

$

0.40

 

$

0.58

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing non-GAAP net income per share attributable to OmniVision Technologies, Inc. common stockholders:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

56,174

 

51,273

 

54,541

 

50,870

 

54,235

 

Diluted

 

60,634

 

53,421

 

58,942

 

52,525

 

58,686

 

 

Contact Information

Investor Relations:

Brian M. Dunn

OmniVision Technologies, Inc.

Ph: 408.653.3263