BEIJING, Aug. 10 /PRNewswire-Asia-FirstCall/ -- Vimicro
International Corporation (Nasdaq: VIMC) ("Vimicro"), a leading
multimedia semiconductor and solution provider, today announced
financial results for the second quarter ended June 30, 2010.
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Second Quarter 2010
Net revenue in the second quarter of 2010 was $26.4 million, above the Company's guidance of
$24 million to $26 million and an
increase of 31% compared to $20.1
million in the first quarter of 2010 and 41% from the
$18.7 million in the second quarter
of 2009. The growth in revenue reflects increases in demand for the
Company's notebook camera processor and mobile multimedia products.
Gross margin improved to 34.3% compared to 33.6% in the previous
quarter driven by continued strength in notebook products and a
favorable mix of higher margin mobile products.
Dr. John Deng, Vimicro's Chairman
and Chief Executive Officer, commented, "Vimicro's revenue growth
in the quarter reflects increased volume for the Company's notebook
and mobile product lines with shipments in our notebook segment
increasing 30% from our tier-one global brand customers. In
addition, revenue from our TD-SCDMA based 3G mobile multimedia
processors increased over last quarter as we continue to ramp
shipments of higher ASP products in this segment. Also during the
quarter, our gross margin further improved driven by increased
sales of our higher margin products."
Second quarter 2010 net loss, prepared in accordance with U.S.
Generally Accepted Accounting Principles (GAAP), was $4.3 million, which included $0.9 million in share-based compensation expense
and $1.0 million IP/Software purchase
expense. After excluding loss attributable to non-controlling
interest, net loss attributed to Vimicro was $2.8 million in the second quarter, or
$0.08 loss per ADS (each representing
four ordinary shares), compared to a net loss of $4.4 million, or $0.12 loss per ADS, in the first quarter of
2010.
Dr. Deng concluded, "As we look to the second half of the year,
we expect continued strong demand for notebook embedded camera
products and mobile multimedia products. In the surveillance
market, we are well positioned to benefit from new product cycles.
We expect our surveillance business to expand as projects that are
currently in the bidding process materialize, and we begin
delivering on potential opportunities under the government's Peace
City initiatives. We look forward to further growth and achieving
profitability as the Company expands our penetration of these large
and growing markets."
Business Outlook
For the third quarter of 2010, the Company expects revenue to
range between $27 million and $31
million, representing 31.7% to 51.2% growth over the
$20.5 million reported in the third
quarter of 2009, and 2.4% to 17.6% sequential growth over the
second quarter.
Financial Results Conference Call and Webcast
Vimicro will host a conference call and Webcast August 10, 2010 at 6:30
p.m. Eastern Time to discuss the Company's recent results.
Investors and other interested parties may access the call by
dialing 866-730-5769 (or +1-857-350-1593 outside of the U.S.) with
the pass code 67825167, at least 10 minutes prior to the start of
the call.
In addition, an audio Webcast will be available in the Investor
Relations section of the Company's Web site at
http://www.vimicro.com . Following the live Webcast, an archived
version will be available on the Company's Web site. A telephone
replay of the call will also be available approximately two hours
after the call and will be available until August 17, 2010 at midnight (ET). The replay
number is 888-286-8010 with a pass code of 52640454. International
callers should dial +1-617-801-6888 and enter the same pass code at
the prompt.
About Vimicro International Corporation
Vimicro International Corporation is a leading multimedia
semiconductor and solution provider that designs, develops and
markets mixed-signal semiconductor products and system-level
solutions that enable multimedia capabilities in a variety of
products for the consumer electronics and communications markets.
Vimicro is also expanding business into the surveillance market
with system-level solutions and semiconductor products. Vimicro's
ADSs, each of which represents four ordinary shares, are currently
trading on the NASDAQ Global Market under the ticker symbol
"VIMC."
Forward-Looking Statements
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates," "confident" and similar statements. Among
other things, the quotations from management in this announcement,
as well as Vimicro's expectations and forecasts, contain
forward-looking statements. Vimicro may also make written or oral
forward-looking statements in its periodic reports to the U.S.
Securities and Exchange Commission on forms 20-F and 6-K, etc., in
its annual report to shareholders, in press releases and other
written materials and in oral statements made by its officers,
directors or employees to third parties. Statements that are not
historical facts, including statements about Vimicro's beliefs and
expectations, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties. A number of
factors could cause actual results to differ materially from those
contained in any forward-looking statement, including but not
limited to the following: the company's ability to develop and sell
new mobile multimedia products; the expected growth of the mobile
multimedia market; the company's ability to increase sales of
notebook camera multimedia processors; the company's ability to
retain existing customers and acquire new customers and respond to
competitive market conditions; the company's ability to respond in
a timely manner to the evolving multimedia market and changing
consumer preferences and industry standards and to stay abreast of
technological changes; the company's ability to secure sufficient
foundry capacity in a timely manner; the company's ability to
effectively protect its intellectual property and the risk that it
may infringe on the intellectual property of others; and
cyclicality of the semiconductor industry. Further information
regarding these and other risks is included in Vimicro's annual
report on Form 20-F filed with the Securities and Exchange
Commission. Vimicro does not undertake any obligation to update any
forward-looking statement, except as required under applicable law.
All information provided in this press release is as of the date
hereof, and Vimicro undertakes no duty to update such information,
except as required under applicable law.
Non-GAAP Measures
To supplement the consolidated financial statements presented in
accordance with GAAP, Vimicro uses non-GAAP measures of non-GAAP
(loss)/income from operations, non-GAAP net (loss)/income
attributed to Vimicro International Corporation and non-GAAP
diluted net (loss)/income per ADS, which are adjusted from the most
directly comparable financial measures calculated and presented in
accordance with GAAP to exclude amortization of share-based
compensation expenses. These non-GAAP financial measures are
provided to enhance investors' overall understanding of the
company's financial performance as they exclude share-based
expenses that are not expected to result in future cash payments.
The non-GAAP measures should be considered in addition to results
prepared in accordance with GAAP, but should not be considered a
substitute for or superior to GAAP results. A limitation of using
these non-GAAP financial measures is that these non-GAAP measures
exclude share-based compensation charges that have been and will
continue to be significant recurring expenses in our business for
the foreseeable future. We compensate for these limitations by
providing the relevant disclosure of our share-based compensation
charges in our reconciliations to the GAAP measures. For more
information on the non-GAAP financial measures, please see the
tables captioned "Reconciliation of non-GAAP results of operations
measures to the nearest comparable GAAP measures" set forth at the
end of this release.
Vimicro believes that both management and investors benefit from
referring to these non-GAAP measures in assessing the performance
of Vimicro's liquidity and when planning and forecasting future
periods. These non-GAAP financial measures also facilitate
management's internal comparisons to Vimicro's historical
liquidity. Vimicro computes its non-GAAP financial measures using
the same consistent method from quarter to quarter. The
accompanying tables have more details on the GAAP financial
measures that are most comparable to non-GAAP financial measures
and the related reconciliations between financial measures.
Currency Translation
This announcement contains translations of certain RMB amounts
into U.S. dollars. Unless otherwise noted, all translations from
RMB to U.S. dollars are based on the applicable exchange rates
quoted by the Bank of China as of
June 30, 2010, which was RMB 6.7909 to $1.00.
For further information about Vimicro, please contact:
Investor Contacts:
Jack Guo, Vice President of Investor Relations
Phone: +86-10-6894-8888 ext. 7379
Email: jackguo@vimicro.com
Shelton Group Investor Relations
Leanne K. Sievers, EVP
Phone: +1-949-224-3874
Email: lsievers@sheltongroup.com
Vimicro International Corporation
Consolidated Balance Sheets
(Amounts expressed in thousands of U.S. dollars, except number of share
data)
6/30/2010 12/31/2009
(unaudited) (audited)
Assets
Current assets:
Cash and cash equivalents 60,354 84,510
Short-term time deposits 44,177 43,935
Restricted cash 869 132
Marketable equity securities 819 543
Accounts receivable, net of
provision for doubtful accounts 11,638 9,462
Inventories 16,739 8,804
Prepayments and other current
assets 5,322 4,155
Deferred tax assets 3 3
Total current assets 139,921 151,544
Property, equipment and software, net 9,047 9,015
Land use rights 20,291 10,905
Intangible assets, net 3,348 3,819
Goodwill 2,031 2,019
Other assets 968 973
Total assets 175,606 178,275
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable 7,975 4,958
Notes payable 386 --
Taxes payable 1,226 879
Advances from customers 571 649
Accrued expenses and other current
liabilities 4,927 5,900
Deferred government grants 2,761 3,844
Total current liabilities 17,846 16,230
Non-Current liabilities:
Deferred tax liabilities 99 196
Product warranty 49 25
Total liabilities 17,994 16,451
Shareholders' equity:
Ordinary shares,$0.0001 par value,
500,000,000 shares authorized,
147,724,068 and 147,643,168
shares issued and outstanding as
of June 30, 2010 and December 31,
2009, respectively 15 15
Additional paid-in capital 154,390 151,672
Treasury stock (2,664) (2,664)
Accumulated other comprehensive
income 10,549 9,967
Accumulated deficit (42,989) (35,786)
Statutory reserve 2,782 2,782
Total shareholders equity
attributable to Vimicro
International Corporation 122,083 125,986
Noncontrolling interest 35,529 35,838
Total shareholders' equity 157,612 161,824
Total liabilities and
shareholders' equity 175,606 178,275
Vimicro International Corporation
Consolidated Statement Of Operations And Comprehensive Income
(Amounts expressed in thousands of U.S. dollars, except number of share
data)
2010 Q2 2010 Q1 2009 Q2
(unaudited) (unaudited) (unaudited)
Net revenue 26,368 20,110 18,717
Cost of revenue (17,314) (13,351) (13,393)
Gross profit 9,054 6,759 5,324
Operating expenses:
Research and development, net (8,801) (8,750) (7,371)
Selling and marketing (1,969) (1,457) (1,129)
General and administrative (3,161) (3,208) (6,019)
Total operating expenses (13,931) (13,415) (14,519)
Loss from operations (4,877) (6,656) (9,195)
Other income/(expense):
Interest income 292 309 387
Foreign exchange (loss)/gain, net 54 (35) 2
Gain on disposal of available-for-
sale securities -- -- 512
Others, net 750 861 53
Loss before income taxes (3,781) (5,521) (8,241)
Income taxes expense (518) (172) --
Net loss (4,299) (5,693) (8,241)
Less: (loss)/income attributable to
non-controlling interest (1,504) (1,285) 135
Loss attributed to Vimicro
International Corporation (2,795) (4,408) (8,376)
Other comprehensive income:
Foreign currency translation
adjustment 458 33 73
Unrealized gain on marketable
equity securities 263 13 315
Comprehensive loss (3,578) (5,647) (7,853)
Less: comprehensive (loss)/income
attributable to non-controlling
interest (1,319) (1,285) 188
Comprehensive loss attributable to
Vimicro International Corporation (2,259) (4,361) (8,041)
Loss per share
Basic (0.02) (0.03) (0.06)
Diluted (0.02) (0.03) (0.06)
Loss per ADS
Basic (0.08) (0.12) (0.24)
Diluted (0.08) (0.12) (0.24)
Weighted average number of ordinary
shares outstanding
Basic 147,690,245 147,657,701 138,706,574
Diluted 147,690,245 147,657,701 138,706,574
Weighted average number of ADS
outstanding
Basic 36,922,561 36,914,425 34,676,643
Diluted 36,922,561 36,914,425 34,676,643
Components of share-based
compensation expenses
are included in the following
expense captions:
R&D (422) (532) (1,634)
S&M (50) (56) (70)
G&A (477) (575) (3,963)
Total (949) (1,163) (5,667)
Reconciliations of non-GAAP results of operations measures to the nearest
comparable GAAP measures (*)
(Amounts expressed in thousands of U.S. dollars, except per share
data, unaudited)
Three months ended Three months ended
June 30, March 31,
2010 2010
GAAP Adjust- Non-GAAP GAAP Adjust- Non-GAAP
Results ment Results Results ment Results
Loss from operations (4,877) 949 (3,928) (6,656) 1,163 (5,493)
Loss attributed to Vimicro
International Corporation (2,795) 949 (1,846) (4,408) 1,163 (3,245)
Diluted loss per ADS (0.08) 0.03 (0.05) (0.12) 0.03 (0.09)
Three months ended
June 30, 2009
GAAP Adjust- Non-GAAP
Results ment Results
Loss from operations (9,195) 5,667 (3,528)
Loss attributed to Vimicro
International Corporation (8,376) 5,667 (2,709)
Diluted loss per ADS (0.24) 0.16 (0.08)
(*) The adjustment is to exclude non-cash for share-based compensation for
employees and non-employees.
SOURCE Vimicro International Corporation
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