- Total Sales for the quarter increased 2.2% sequentially
and 16.4% year-over-year to $227.2 million, the highest quarterly
revenue since Q4 2008. Full year 2014 revenues increased 9.1%
year-over-year to $840.5 million.
- Compared to the Q4 2013, large-sized panel driver sales
increased 39.9%, the fourth quarter in a row that it enjoyed
sequential growth. Small and medium-sized panel driver sales
increased 1.7%, achieving record high quarterly revenue. Non-driver
sales increased 32.1%.
- Gross margin for the quarter increased 20 bps to 24.7%
from Q3 2014, exceeding Q4 2014 guidance.
- Q4 2014 GAAP net income was $15.6 million, or 9.1 cents
per diluted ADS. GAAP net income declined 1.3 % from Q4 2013 and it
increased 40.2% from Q3 2014.
- Excluding exchange rate impact on our income tax, GAAP
net income grew 20.8% from Q4 2013 and it grew 80.3% over Q3
2014.
- Non-GAAP adjusted pre-tax income for the fourth quarter
grew 13.6% from the Q4 2013, reaching $25.6 million.
- FY 2014 GAAP net income increased by 8.3% to $66.6
million, or 38.7 cents per diluted ADS. Excluding exchange rate
impact on income tax, 2014 GAAP net income and GAAP EPS grew 13.2%
and 13.1% year over year, respectively.
- Company maintains positive full year 2015 outlook and
expects revenues and earnings growth to continue.
Himax
Technologies, Inc.
(Nasdaq:HIMX) ("Himax" or
"Company"), a leading supplier and fabless manufacturer of
display drivers and other semiconductor products, today announced
financial results for the fourth quarter and full year ended
December 31, 2014.
SUMMARY
FINANCIALS |
|
Fourth Quarter 2014
Results Compared to Fourth Quarter 2013 Results (USD in millions)
(unaudited) |
|
|
|
|
|
Q4 2014 |
Q4 2013 |
CHANGE |
Net Revenues |
$227.2 million |
$195.2 million |
+16.4% |
Gross Profit |
$56.0 million |
$49.0 million |
+14.3% |
Gross Margin |
24.7% |
25.1% |
-0.4% |
GAAP Net Income Attributable to
Shareholders |
$15.6 million |
$15.8 million |
-1.3% |
Non-GAAP Net Income Attributable to
Shareholders |
$16.1 million (1) |
$16.6 million (2) |
-2.8% |
GAAP EPS (Per Diluted ADS, USD) |
$0.091 |
$0.092 |
-1.3%(3) |
Non-GAAP EPS (Per Diluted ADS, USD) |
$0.094 (1) |
$0.097 (2) |
-2.8% |
|
|
|
|
(1) Non-GAAP Net income
attributable to common shareholders and EPS excludes $0.4 million
of share-based compensation expenses, net of tax and $0.1 million
non-cash acquisition related charges, net of tax. |
(2) Non-GAAP Net income
attributable to common shareholders and EPS excludes $0.3 million
of share-based compensation expenses, net of tax and $0.5 million
non-cash acquisition related charges, net of tax. |
(3) Excluding exchange rate
impact on income tax charge, GAAP EPS grew 20.8% from the same
period last year |
|
|
|
|
|
|
|
|
Fourth Quarter 2014
Results Compared to Third Quarter 2014 Results (USD in millions)
(unaudited) |
|
|
|
|
|
Q4 2014 |
Q3 2014 |
CHANGE |
Net Revenues |
$227.2 million |
$222.3 million |
+2.2% |
Gross Profit |
$56.0 million |
$54.4 million |
+3.1% |
Gross Margin |
24.7% |
24.5% |
+0.2% |
GAAP Net Income Attributable to
Shareholders |
$15.6 million |
$11.1 million |
+40.2% |
Non-GAAP Net Income Attributable to
Shareholders |
$16.1 million (1) |
$19.1 million (2) |
-15.7% |
GAAP EPS (Per Diluted ADS, USD) |
$0.091 |
$0.065 |
+39.9% (3) |
Non-GAAP EPS (Per Diluted ADS, USD) |
$0.094 (1) |
$0.111 (2) |
-15.9% |
|
|
|
|
(1) Non-GAAP Net income
attributable to common shareholders and EPS excludes $0.4 million
of share-based compensation expenses, net of tax and $0.1 million
non-cash acquisition related charges, net of tax. |
(2) Non-GAAP Net income
attributable to common shareholders and EPS excludes $7.9 million
of share-based compensation expenses, net of tax and $0.1 million
non-cash acquisition related charges, net of tax. |
(3) Excluding exchange rate
impact on income tax charge, GAAP EPS grew 80.0% from the previous
quarter. |
"I am pleased to report that our 2014 fourth quarter revenues,
gross margin, GAAP and non-GAAP earnings per diluted ADS all came
in at the high end, or exceeded our guidance," stated Mr. Jordan
Wu, President and Chief Executive Officer of Himax. "Solid fourth
quarter revenues of $227.2 million represented a 16.4% increase
from the same quarter last year and a 2.2% sequential increase from
the previous quarter. Our fourth quarter revenues were the highest
since the fourth quarter of 2008. Fourth quarter revenues came in
at the high end of our guidance, driven by better-than-expected
driver IC sales for televisions, smartphones and tablet
applications, primarily in the Chinese and Korean markets. Himax
continues to execute on our strategy of becoming a more diversified
company with regard to product offerings as well as customers. We
are very pleased to be experiencing growth in both our driver and
non-driver business segments. We are particularly excited about the
prospects for our LCOS microdisplay and WLO products, which are
integral parts of the eco-system for the rapidly emerging head
mounted display products and next-generation cameras for mobile
devices. Equally exciting is our market leading single-chip
solutions for pure in-cell touch display, which we believe will
soon become mainstream in portable and wearable devices. In
summary, Himax is at a significant inflection point, with many of
our non-driver products ready to enter the consumer market after
many years of product development and R&D."
Fourth Quarter 2014
Financial Results Breakdown by Product Line (USD in
millions) (unaudited) |
|
|
|
|
|
|
|
Q4 2014 |
% |
Q4 2013 |
% |
% Change |
Display drivers for large-sized panels |
$65.5 |
28.8% |
$46.8 |
24.0% |
+39.9% |
Display drivers for small/medium-sized
panels |
$114.8 |
50.5% |
$113.0 |
57.9% |
+1.7% |
Non-driver products |
$46.9 |
20.7% |
$35.4 |
18.1% |
+32.1% |
|
|
|
|
|
|
|
Q4 2014 |
% |
Q3 2014 |
% |
% Change |
Display drivers for large-sized panels |
$65.5 |
28.8% |
$61.2 |
27.5% |
+7.0% |
Display drivers for small/medium-sized
panels |
$114.8 |
50.5% |
$113.3 |
51.0% |
+1.4% |
Non-driver products |
$46.9 |
20.7% |
$47.8 |
21.5% |
-2.0% |
Revenues from large panel display drivers were $65.5 million, up
39.9% from a year ago and up 7.0% sequentially. Large panel driver
IC accounted for 28.8% of the Company's total revenues for the
fourth quarter, compared to 24.0% a year ago and 27.5% in the last
quarter. This is the fourth quarter in a row when large panel
driver IC sales enjoyed sequential growth. The growth was driven by
strong shipments to both existing and new customers with 4K TV
demand particularly robust in the second half of last year. The
Company is confident that the positive momentum will continue into
2015, and it will anticipate gaining share in this segment.
Sales for small and medium-sized drivers came in at $114.8
million, marking a quarterly record-high. These revenues were up
1.7% from the same period last year and up 1.4% sequentially.
Driver ICs for small and medium-sized applications accounted for
50.5% of total revenues for the fourth quarter as compared to 57.9%
a year ago and 51.0% in the previous quarter. Korean and Chinese
smartphone customer's demand was robust, especially in the higher
end segments. It is worth highlighting that the Company experienced
a nice surprise in branded tablet market. Despite a slight decline
from the last quarter, tablet revenues were better than initially
guided. Himax believes that branded tablets, with larger screens
and attractive functions such as convertibility, innovative covers
and keyboard design, are enjoying a competitive advantage against
the white box products.
Revenues from our non-driver businesses were $46.9 million, up
32.1% from the same period last year and down 2.0% sequentially.
Non-driver products accounted for 20.7% of total revenues, as
compared to 18.1% a year ago and 21.5% in the previous quarter.
Touch panel controllers, timing controllers, CMOS image sensors,
and LCOS microdisplay ICs were the main contributors to the growth
of the non-driver product segment in the quarter. Among non-driver
products, touch controllers showed the strongest growth, nearly
tripling from the same period of 2013, and growing more than 40%
sequentially. CMOS Image sensor sales nearly doubled year over
year.
GAAP gross margin for the fourth quarter of 2014 was 24.7%, down
from 25.1% a year earlier and up from 24.5% in the previous
quarter. The Company guided gross margin to be slightly down within
1% in the last earnings call. Gross margin beat guidance mainly due
to a more favorable product mix including high end smartphone and
tablet driver ICs, and higher NRE incomes.
GAAP operating expenses were $33.4 million in fourth quarter of
2014, up 12.8% from a year ago and down 20.1% from the previous
quarter. The sequential decrease was primarily the result of the
difference in RSU charges. In accordance with the Company's
protocol, it grants annual RSUs to its staff at the end of
September each year, which, given all other items are equal, leads
to higher third quarter GAAP operating expenses compared to the
other quarters of the year. The fourth quarter RSU expense was only
$0.5 million while it was $9.3 million in the third quarter.
Excluding RSU expenses, operating expenses increased 12.3% year
over year and 3.2% from last quarter. The sequential increase was
mainly attributable to certain new product tape-outs, while the
year over year increase was due mainly to salary raises and more
headcounts. The increase was partially offset by lower salary
expenses in USD terms. The Company paid the vast majority of our
salaries in NTD which represented a lower amount in USD in its
accounting as the NTD depreciated against the USD.
GAAP operating income for the fourth quarter of 2014 was $22.6
million or 10.0% of sales, up 16.6% year over year and up 80.3%
sequentially. The sequential increase was mainly a result of the
higher RSU expense booked in the previous quarter. However,
non-GAAP operating income still experienced 2.6% sequential
growth.
Reported GAAP net income for the fourth quarter was $15.6
million, or 9.1 cents per diluted ADS, compared to $15.8 million,
or 9.2 cents per diluted ADS, for the same period last year, and
$11.1 million, or 6.5 cents per diluted ADS, in the previous
quarter. As the Company reported in its last earnings release, it
has taken into account for a $1.5 million negative impact for its
income tax in its guidance due to depreciation of NT dollar. The
Company has taken an additional $3.3 million, or 1.9 cents per
diluted ADS, of income tax charge to reflect the NT dollar
depreciation against the US dollar in the fourth quarter of 2014.
While the Company's reporting currency is the US dollar, the vast
majority of taxes are incurred in its NT dollar book, which is the
required reporting currency for Taiwan tax authorities. The NT
dollar depreciation resulted in foreign exchange gains for the
Company's US dollar assets and therefore higher tax payable in
Taiwan. As a result, the Company's tax payable will be lower if the
NT dollar appreciates against the US dollar. If the NTD/USD rate
had stayed at 30.55 as it was when Himax provided the guidance, the
Company's EPS would have been higher by 1.9 cents, far
outperforming original guidance.
GAAP net income declined 1.3% year over year and increased 40.2%
from the previous quarter. Excluding the above-mentioned exchange
rate impact on income tax, GAAP net income grew 20.8% year over
year and 80.3% sequentially. The sequential net income growth was
mainly a result of the difference in RSU charges. The year over
year growth was primarily due to higher revenues.
Excluding the share-based compensation, acquisition-related
charges and income tax provisions, the Company's non-GAAP adjusted
pre-tax income for the fourth quarter increased 6.9% sequentially,
and it grew 13.6% from the same period last year, reaching $25.6
million. The sequential increase was a result of a slight margin
improvement on higher revenue, while the year over year profit
increase was due to the 16.4% higher revenue offset by $4.1 million
of higher operating expenses. Amid a slow market environment during
the quarter, the Company managed to achieve significant top and
bottom-line improvement year over year, thanks to better sales from
large panel DDICs, DDICs for tablets, CMOS image sensors and touch
controller ICs.
Full Year 2014 Results
(USD in millions) (unaudited) |
|
|
|
|
|
FY 2014 |
FY 2013 |
CHANGE |
Net Revenues |
$840.5 million |
$770.7 million |
+9.1% |
Gross Profit |
$205.9 million |
$191.9 million |
+7.3% |
Gross Margin |
24.5% |
24.9% |
-0.4% |
GAAP Net Income Attributable to
Shareholders |
$ 66.6 million |
$ 61.5 million |
+8.3% |
Non-GAAP Net Income Attributable to
Shareholders |
$ 76.0 million (1) |
$ 71.0 million (2) |
+7.0% |
GAAP EPS (Per Diluted ADS) |
$0.387 |
$0.358 |
+8.2% (3) |
Non-GAAP EPS (Per Diluted ADS) |
$0.442 (1) |
$0.414 (2) |
+6.9% |
|
|
|
|
1) Non-GAAP Net income
attributable to common shareholders and EPS excludes $8.8 million
of share-based compensation expenses, net of tax and $0.6 million
non-cash acquisition related charges, net of tax. |
2) Non-GAAP Net income
attributable to common shareholders and EPS excludes $7.5 million
of share-based compensation expenses, net of tax and $2.0 million
non-cash acquisition related charges, net of tax. |
(3) Excluding exchange rate
impact on income tax charge, GAAP EPS grew 13.1% year over
year. |
|
Full Year 2014 Financial
Results |
|
Breakdown by Product Line
(USD in millions) (unaudited) |
|
FY 2014 |
% |
FY 2013 |
% |
% Change |
Display drivers for large-sized panels |
$226.1 |
26.9% |
$228.9 |
29.7% |
-1.2% |
Display drivers for small/medium-sized
panels |
$446.0 |
53.1% |
$415.6 |
53.9% |
+7.3% |
Non-driver products |
$168.4 |
20.0% |
$126.2 |
16.4% |
+33.5% |
Despite a few challenges, the Company still managed to grow in
2014. Small and medium-sized driver IC remained Himax's largest
source of sales. The Company's market leading position in this
business segment enabled it to take advantage of the growing global
demand for smartphones and tablets as well as the industry trend
toward higher resolution displays. For large panel display driver
business, Himax continued to expand its sales to Chinese customers
and secured a leading market share in that country. The Company
also gained market share from non-China customers. Meanwhile,
non-driver products continued to outgrow driver ICs and achieve
record high revenues. Himax saw exciting progress on many of its
non-driver products. Many of the non-driver products have already
penetrated into marquee and globally recognized end customers.
Revenues totaled $840.5 million in 2014, representing a 9.1%
increase over 2013. Notably, Himax's customer diversification
continued to expand as it added multiple TIER-1 customers across
all of its product lines.
Small and medium-sized driver sales grew 7.3% and represented
53.1% of the Company's total revenues, another record high. Of the
7.3% growth, tablet and automotives DDICs showed particular
strength, while smartphone DDICs delivered modest growth. Tablet
driver IC sales grew nearly 10% in 2014; however, sales in the
second half of the year declined 20% from the first half, signaling
weak overall market demand. Meanwhile, automotive driver IC sales
registered the strongest growth in this segment, at approximately
50%, and the momentum is expected to carry over into 2015. Himax is
among the leading suppliers of small and medium-sized DDIC for
panel makers across Taiwan, Korea, China and Japan, covering the
vast majority of leading smartphone and tablet end customer names
in both China and the international markets. The Company's leading
technology, on the back of the industry's migration toward higher
panel resolution over the past few years, has enabled Himax to
achieve respectable growth in these segments.
Revenues from large panel display drivers declined 1.2% year
over year, representing 26.9% of the Company's total revenues, as
compared to 29.7% in 2013. However, the business bottomed out in
the first quarter of 2014, and Himax enjoyed three consecutive
quarters of growth thereafter. The Company was able to achieve a
more diversified customer base by adding new customers in Taiwan,
China and Korea. Being the technology leader, it also benefitted
from the surging 4K TV demand, a higher dollar content business
with significant barriers of entry. The Company is pleased that
large panel DDIC has once again become a growing segment for the
Company despite the continued soft demand in monitors and notebook
markets.
Non-driver products grew 33.5% and represented 20.0% of Himax's
total sales, as compared to 16.4% a year ago. Touch controller,
CMOS image sensor, timing controller, LCOS microdisplay ICs and
ASIC service all delivered strong growth. Himax also experienced
growing market interest and deepening customer engagement in our
LCOS and WLO businesses. As noted previously, the Company continues
to work with several industry heavyweights in the LCOS and WLO
business. These two technologies are being applied in some of their
future products, ranging from head mounted displays to next
generation mobile devices, and the Internet of Things. Himax is
excited that LCOS and WLO should experience this inflection point
in 2015.
Gross margin in 2014 was 24.5%, a 40 basis-point decline, from
24.9% in 2013. The slight margin decline was mainly a result of
higher shipment of older generation CMOS image sensors in first
half of last year. Foundry capacity constraint in second half of
the year also had some negative impact on gross margin. However,
the above mentioned factors were largely offset by growing demand
from 4K TV, and NRE incomes from ASIC, LCOS and WLO products.
GAAP operating expenses were $133.2 million for the year, up
$15.6 million or 13.3% compared to last year. The Company has
repeatedly indicated since late 2013 that it intended to increase
R&D expenses to capture new business opportunities, following
several years of stable R&D spending. Himax believes that such
investments will come to fruition starting in 2015.
Due to higher operating expenses, GAAP operating income of $72.7
million represented a 2.2% decrease versus 2013.
GAAP net income for the year was $66.6 million, or 38.7 cents
per diluted ADS, up from $61.5 million, or 35.8 cents per diluted
ADS, for the same period last year. The exchange rate impact on
income tax was $5.6 million for 2014 and $2.3 million for 2013.
Excluding the exchange rate impact on income tax, 2014 GAAP net
income grew 13.2% year over year.
Non-GAAP net income for 2014 was $76.0 million, or 44.2 cents
per diluted ADS, up from $71.0 million, or 41.4 cents per diluted
ADS, for 2013. The increase in non-GAAP net income was mainly the
result of an $8.6 million net gain from the disposal of an
investment in the second quarter. Non-GAAP net income and Non-GAAP
earnings per diluted ADS grew 7.0% and 6.9% year over year,
respectively.
Balance Sheet and Cash Flow
The Company had $187.8 million in cash, cash equivalents and
marketable securities at the end of December 2014, compared to
$128.1 million at the same time last year and $147.7 million a
quarter ago. This is a historical high in its cash position since
the second quarter of 2009. On top of the above cash position,
restricted cash was $130.2 million at the end of the quarter. The
restricted cash is mainly used to guarantee the company's short
term loan for the same amount. Himax continues to maintain a strong
balance sheet with no debt.
Inventories as of December 31, 2014 were $166.1 million, down
from $177.4 million a year ago and up from $157.1 million a quarter
ago. The higher inventory was due to the expected customer
restocking of driver ICs for all panel sizes, CMOS image sensor and
a few other non-driver products after Chinese New Year and into the
second quarter of 2015. This is also a move to counter foundry
capacity constraint. Nevertheless, the year-over-year decline in
inventory reflects better inventory management in 2014 despite a
healthy sales growth in 2014. Average days in inventory were
successfully reduced by 23 days. Accounts receivable at the end of
December 2014 were $219.4 million as compared to $200.7 million a
year ago and $218.8 million last quarter. DSO stayed flat at 95
days at the end of December, 2014, little changed from 95 days a
year ago and 97 days at end of the last quarter.
Net cash inflow from operating activities for the fourth quarter
was $38.7 million as compared to an outflow of $1.8 million for the
fourth quarter of 2013 and an inflow of $22.8 million for the third
quarter of 2014. Cumulative cash inflow from operations in 2014 was
$93.7 million as compared to $51.1 million in 2013, the second
highest year since the company's inception in 2006. The growth in
cash inflow was a result of improved profitability and inventory
reduction.
Capital expenditures were $2.4 million in the fourth quarter of
2014 versus $3.9 million a year ago and $2.1 million last quarter.
The capital expenditure in the fourth quarter consisted mainly of
purchases of certain equipments for the Company's driver IC
products and facility updates for LCOS and WLO product lines. Total
capital expenditures for the year were $10.9 million versus $18.4
million a year ago. The Company purchased less CP testers in 2014,
resulting in the differential in capital expenditure year over
year.
In July 2014, Himax paid an annual dividend of 27 cents per ADS,
equal to 75.0% of 2013 GAAP earnings per diluted ADS. Himax remains
committed to paying annual dividends, the amount of which is
referenced primarily on prior year's profitability. The high payout
ratio in 2014 is an illustration of the Company's confidence in its
future profitability.
Share Buyback Update
As of December 31, 2014, Himax had 171.2 million ADS
outstanding, unchanged from last quarter. On a fully diluted basis,
the total ADS outstanding are 172.2 million.
Upcoming Investor Outreach and Conferences
Ms. Jackie Chang, CFO, and Scott Powell, US-based IR, will host
investor meetings and attend investor conferences in the U.S. in
the coming month. If you are interested in meeting with the
Company's senior executives in a one-on-one session or group
session, please contact Himax's US or Taiwan-based investor
relations contact at the numbers below.
Business Updates
Following a successful transformation in 2013, Himax delivered
strong operational and financial results in 2014. This
accomplishment illustrates the successful execution of the
Company's long term strategy to diversify its customer base and
product portfolio.
Looking into 2015, despite the current softness in China's
smartphone and tablet markets, which is worsened by fewer working
days due to the timing of Chinese New Year, the Company is excited
about its full year outlook and believes that it will experience
strong growth across all business segments. The Company anticipates
2015 to be another year of continuous revenue and earnings
growth.
Following a few years of revenue decline, large panel driver IC
sales should be a major growth engine for the Company in 2015.
Himax expects its large panel drivers in the first quarter of 2015
to register strong growth compared to the same period last year, at
approximately 25%. The Company should continue to benefit from the
display capacity expansion in China, where it is the market leader
in driver IC sales. Furthermore, Himax expects to grow market share
in the non-China large panel market in 2015. On the technology
front, Himax remains a market leader in providing state-of-the-art,
high-end large panel driver IC solutions. 4K TV penetration should
continue to be the driving force for growth in this segment with
its sales volume expected to more than double this year.
In the Company's previous earnings calls, it mentioned that
large panel makers are increasingly demanding a total solution from
IC vendors. Himax is experiencing accelerating demand from panel
manufacturers seeking IC vendors who can provide driver IC, TCON,
Gamma OP, and PMIC as a total solution. Meanwhile, TCON is getting
more and more technologically advanced, with high end models
integrating sophisticated functions such as MEMC. This positions
the Company very well in the 4K TV market and beyond. As the
industry migrates to 8K TVs, which is already starting to take
place in product development, the Company's business and technology
strength and integrated product solutions will be a significant
differentiator against its competitors.
Thanks to its leading technology and comprehensive customer
base, the Company is confident that it is at the beginning of a
long term growth trend for its large panel driver products, a trend
which should last for the next several years.
For driver ICs used in small and medium-sized panels, business
covers smartphones, tablets and automotive applications markets.
The Company expects continued resolution upgrades this year in both
the smartphone and table markets. FHD is quickly replacing HD720 to
become the new mainstream for high end smartphones. Himax also
expects to begin mass producing driver IC for the very high end QHD
resolution panel at the beginning of Q2 this year. A more favorable
product mix should help the Company mitigate margin pressure in the
competitive smartphone market. Notwithstanding its positive
outlook, first quarter sales for smartphone drivers are likely to
decline substantially, which the Company already indicated in its
last earnings call. The weakness is particularly significant in
China where smartphone vendors, lacking new government stimulus
programs, are turning cautious as they are forced to try new sales
channels such as e-commerce and direct sales points to replace the
previous approach of selling through telecom operators. Worse yet,
exports are also weak because Chinese smartphone manufacturers are
worried that a strong RMB would further compress their already thin
profit margin. Following two quarters of market weakness, the
Company has started to build inventory in preparation for a market
rebound toward the end of Q1 or Q2. In addition to its leading
position in TFT-LCD smartphone driver IC product offerings, Himax
started small shipments of AMOLED driver IC to certain Chinese
customers in Q4 2014. AMOLED is likely to be a future growth engine
for its small panel driver IC business and Himax is collaborating
with multiple customers both in Korea and China on AMOLED product
development. It is worth mentioning that quite a few new AMOLED
fabs are being built in China and the Company has the most
comprehensive customer coverage there, although this will not bring
in meaningful revenue contribution until later this year.
The company also expects a significant sequential sales decline
for tablets in the first quarter, for reasons similar to those for
the smartphone market mentioned above. Moreover, in the Chinese
tablet market, there are more smaller and less resourceful players,
many of them being forced out of the market due to the Chinese
government's credit tightening policy, causing further market
weakness. The declining demand might also be a result of changing
consumer behavior, as some consumers are moving to smartphones with
screen sizes similar to those of smaller sized tablets. Tablet
demand, after a lengthy slump, may improve after Chinese New Year;
yet sales visibility is still low as we speak. Going forward,
mainstream demand will be 10" and above with higher resolutions,
instead of the once popular sizes of 7" to 9"s. Himax is seeing
many tier-1 OEMs pursuing this segment aggressively which may
materialize in 2015 and trigger new market demands.
Among driver ICs used in small and medium-sized panels, the most
noteworthy category in 2015 is the automotive application. Himax
has successfully engaged key panel manufacturers and module houses
for long term partnerships. The Company anticipates Q1 sales to be
slightly stronger than the previous quarter and expects robust
sequential growth throughout the year. Himax believes that with
numerous tier 1 automobile brands being its indirect end customers,
the Company is well positioned to take advantage of the growing
market in 2015 and beyond.
The non-driver business segment provides the Company's most
exciting long-term growth prospect. Overall, its non-driver
business category enjoyed approximately 33.5% growth during 2014.
Amid a weak overall market sentiment and the usual seasonality,
Himax expects a double digit sequential decline in its non-driver
products for the first quarter. However, looking ahead, many of its
non-driver products, including our CMOS image sensor, timing
controller, touch panel controller, power management IC, ASIC
service, wafer level optics and LCOS microdisplay, are poised to
grow significantly in 2015.
The Company's touch panel controller product line continued to
experience significant growth in Q4 2014, increasing more than 40%
sequentially. Himax exited 2014 with its touch controller sales
more than doubling from the previous year. The Company expects this
strong growth momentum to continue in 2015. On top of its rapidly
growing market share in the discrete touch panel market segment,
Himax is extremely excited about technological advances in the
latest pure in-cell technology where it is one of the pioneers in
offering one-chip solutions integrating driver IC and touch panel
controllers, or TDDI. Driven by top-tier TFT-LCD makers, the
industry is moving towards pure in-cell panels, which is set to
start mass production in the second half of this year. Himax is in
partnership with essentially all of the leading panel manufacturers
in pure in-cell touch for joint technological development and
expect the market to see major launches of this new technology very
soon.
Revenues from CMOS image sensors also experienced significant
growth in 2014 and should continue to be a fast growing product
area for Himax in 2015. Sales of the Company's 2 and 5 megapixel
products were particularly strong, mainly due to robust demand from
several international customers as well as from Chinese white-box
customers. Looking into 2015, Himax expects its sales of
8-megapixel sensors, now the mainstream design for smartphones, to
accelerate while high end 13 megapixel sensors to start mass
production later in the year. This puts Himax firmly on the map as
one of a small handful of companies capable of offering a
comprehensive product portfolio for smartphone cameras.
In addition to the afore-mentioned consumer applications, Himax
is also making significant progress in CMOS image sensors for
non-consumer applications, which typically enjoy higher margins and
have relatively little direct competition. Himax already started
initial shipments to a Korean automotive end customer and is
actively engaging more module houses to penetrate into Chinese
before-market-installation automotive applications. As the Company
grows sensor sales for automotive and other non-consumer
applications and continues to turn the bulk of its CMOS image
sensor sales from 2 and 5 megapixels to higher end, higher margin 8
and 13 megapixels, Himax expects its CMOS image sensor business to
accelerate in 2015.
Regarding Himax's LCOS business, the Company was very pleased to
see major new head-mounted display devices and/or programs unveiled
by a growing list of industry heavyweights recently. Some of these
devices are truly revolutionary in nature with potentially
breakthrough applications which are not possible without a
head-mounted display. This is clear evidence that the head mounted
display is establishing itself as a new product segment for future
computing. Major technology companies are moving quickly to develop
HMD technologies and that this new product category should
transform the way people interact with the environment. Being the
market leader in the microdisplay technology, Himax is in a unique
position to benefit significantly from this industry trend where
its products are integral components. As the Company mentioned
repeatedly in previous earnings calls, it continues to work with
multiple top tier customers who are committing significant
resources to develop cutting edge HMD products. The Company is
working with some of them on multiple designs simultaneously, many
of which involve custom-built designs that are funded by these
customers' development fees.
The Company unveiled its Front-Litâ„¢ LCOS technology in the
middle of last year. It still represents one of the most
significant technological breakthroughs in the HMD industry. Himax
is seeing more and more customers adopting its proprietary
technology. By consolidating two key components of optical engines
and integrating them into the micro display module itself,
Front-Litâ„¢ LCOS enables an ultra-compact, high brightness and
extremely power-efficient optical engine which is also easier to
manufacture compared to traditional optical engines. There is
essentially no competition to this product.
Furthermore, the Company continues to partner with numerous
industry leading companies using its cutting edge and
industry-dominant wafer level optics, or WLO, for the development
of three technologies of the future, namely array cameras, special
purpose sensors and microdisplay wave guides for head-mounted
displays. This product development often requires the collaboration
of Himax's internal CMOS image sensor, LCOS microdisplay and/or
video processing algorithm teams. Himax sits in a leading and
unique position with respect to these exciting new technologies and
it is the only company in the industry able to offer a true
one-stop total solution. As these Tier 1 customers begin to mass
produce products embedding these new and unique features, Himax,
being in the heart of that supply chain, should benefit
significantly. To meet the anticipated demand growth for its LCOS
and WLO products, the Company is expanding its production capacity
starting in Q1 2015. It will report its progress in due course.
Collectively, the Company's LCOS sales and WLO NRE incomes
should more than double in the first quarter of 2015. This
illustrates the Company's strong customer engagements with
tailor-made designs and represents products in the pipeline which
will translate into meaningful sales and profit contribution in the
near future.
Although the Company is seeing weakness in market demand,
especially in China, which will lead to sequential revenue decline
in the first quarter, it remains confident and excited about all
these aforementioned new developments and the increasing business
opportunities across every business segment for 2015. The Company
believes it is strongly and uniquely positioned for another
successful year. Himax is excited with respect to its business
outlook in 2015 and beyond, both in terms of revenue, profitability
growth, and the adoption of many of its non-driver products.
First Quarter 2015
Guidance
The Company is providing the following financial guidance for
the first quarter of 2015:
Net Revenues: |
To be down 15-22% as compared to the
fourth quarter of 2014 |
Gross Margin: |
To be up 1.0-1.5% from the fourth
quarter of 2014 |
GAAP EPS: |
7.0 to 8.5 cents per diluted ADS |
Non GAAP EPS (1): |
7.3 to 8.8 cents per diluted ADS |
|
|
(1) Non-GAAP EPS excludes
share-based compensation and acquisition-related charges |
In providing the above earnings guidance, we have assumed a
20.5% income tax rate, calculated based on exchange rate of NTD
31.65 against the USD, which is also the exchange rate as of the
end of 2014.
Conference Call
Himax Technologies, Inc. will hold a conference call with
investors and analysts on Thursday, February 12, 2015 at 8:00 a.m.
US Eastern Standard Time and 9:00 p.m. Taiwan Time to discuss the
Company's fourth quarter and full year 2014 financial results.
DATE: |
Thursday, February 12, 2015 |
TIME: |
U.S. 8:00 a.m. EST |
|
Taiwan 9:00 p.m. |
DIAL IN: |
U.S. 1-877-407-4018 |
|
INTERNATIONAL
1-201-689-8471 |
CONFERENCE ID: |
13599287 |
|
|
WEBCAST: |
http://public.viavid.com/index.php?id=112627 |
A replay of the call will be available beginning two hours after
the call through midnight February 19, 2015 (1 p.m. February 20,
Taiwan time) on www.himax.com.tw and by telephone at
+1-877-870-5176 (US Domestic) or +1-858-384-5517 (International).
The conference ID number is 13599287. This call is being webcast by
ViaVid Broadcasting and can be accessed by clicking on this
http://public.viavid.com/index.php?id=112627 or at ViaVid's website
at http://www.viavid.net, where the webcast can be accessed through
February 19, 2016.
About Himax Technologies, Inc.
Himax Technologies, Inc. (HIMX) is a fabless semiconductor
solution provider dedicated to display imaging processing
technologies. Himax is a worldwide market leader in display driver
ICs and timing controllers used in TVs, laptops, monitors, mobile
phones, tablets, digital cameras, car navigation, and many other
consumer electronics devices. Additionally, Himax designs and
provides controllers for touch sensor displays, LCOS micro-displays
used in palm-size projectors and head-mounted displays, LED driver
ICs, power management ICs, scaler products for monitors and
projectors, tailor-made video processing IC solutions and silicon
IPs. The company also offers digital camera solutions, including
CMOS image sensors and wafer level optics, which are used in a wide
variety of applications such as mobile phone, tablet, laptop, TV,
PC camera, automobile, security and medical devices. Founded in
2001 and headquartered in Tainan, Taiwan, Himax currently employs
over 1,700 people from three Taiwan-based offices in Tainan,
Hsinchu and Taipei and country offices in China, Korea, Japan and
the US. Himax has 2,507 patents granted and 808 patents pending
approval worldwide as of December 31, 2014. Himax has retained its
position as the leading display imaging processing semiconductor
solution provider to consumer electronics brands worldwide.
http://www.himax.com.tw
Forward Looking Statements
Factors that could cause actual events or results to differ
materially include, but not limited to, general business and
economic conditions and the state of the semiconductor industry;
market acceptance and competitiveness of the driver and non-driver
products developed by the Company; demand for end-use applications
products; reliance on a small group of principal customers; the
uncertainty of continued success in technological innovations; our
ability to develop and protect our intellectual property; pricing
pressures including declines in average selling prices; changes in
customer order patterns; changes in estimated full-year effective
tax rate; shortages in supply of key components; changes in
environmental laws and regulations; exchange rate fluctuations;
regulatory approvals for further investments in our subsidiaries;
our ability to collect accounts receivable and manage inventory and
other risks described from time to time in the Company's SEC
filings, including those risks identified in the section entitled
"Risk Factors" in its Form 20-F for the year ended December 31,
2013 filed with the SEC, as may be amended.
– FINANCIAL TABLES –
Himax Technologies,
Inc. |
Unaudited Condensed
Consolidated Statements of Income |
(These interim
financials do not fully comply with US GAAP because they omit all
interim disclosure required by US GAAP) |
(Amounts in Thousands
of U.S. Dollars, Except Per Share Data) |
|
|
|
|
|
|
|
|
|
Three
Months |
Three Months |
|
Ended December
31, |
Ended September 30, |
|
2014 |
2013 |
2014 |
|
|
|
|
Net revenues |
$227,179 |
$195,232 |
$222,317 |
|
|
|
|
Costs and expenses: |
|
|
|
Cost of revenues |
171,140 |
146,205 |
167,948 |
Research and development |
22,788 |
19,078 |
28,377 |
General and administrative |
4,901 |
4,938 |
6,515 |
Sales and marketing |
5,714 |
5,605 |
6,921 |
Total costs and
expenses |
204,543 |
175,826 |
209,761 |
|
|
|
|
Operating income |
22,636 |
19,406 |
12,556 |
|
|
|
|
Non operating income: |
|
|
|
Interest income |
225 |
153 |
167 |
Equity in income (losses) of equity method
investees |
(24) |
(32) |
14 |
Foreign exchange gains, net |
759 |
258 |
83 |
Interest expense |
(149) |
(129) |
(139) |
Other income, net |
938 |
347 |
33 |
|
1,749 |
597 |
158 |
Earnings before income
taxes |
24,385 |
20,003 |
12,714 |
Income tax expense |
9,247 |
5,627 |
2,568 |
Net income |
15,138 |
14,376 |
10,146 |
Net loss attributable to
noncontrolling interests |
487 |
1,448 |
1,001 |
Net income attributable to Himax
stockholders |
$15,625 |
$15,824 |
$11,147 |
|
|
|
|
Basic earnings per ADS attributable
to Himax stockholders |
$0.091 |
$0.093 |
$0.065 |
Diluted earnings per ADS attributable
to Himax stockholders |
$0.091 |
$0.092 |
$0.065 |
|
|
|
|
Basic Weighted Average
Outstanding ADS |
171,608 |
170,920 |
170,927 |
Diluted Weighted Average
Outstanding ADS |
172,161 |
172,148 |
171,797 |
|
Himax Technologies,
Inc. |
Unaudited Condensed
Consolidated Statements of Income |
(Amounts in Thousands
of U.S. Dollars, Except Per Share Data) |
|
|
|
|
|
|
|
Twelve
Months |
|
Ended December
31, |
|
2014 |
2013 |
Revenues: |
|
|
Revenues from third parties,
net |
$840,542 |
$684,184 |
Revenues from related parties,
net |
-- |
86,555 |
|
840,542 |
770,739 |
|
|
|
Costs and expenses: |
|
|
Cost of revenues |
634,660 |
578,886 |
Research and development |
91,839 |
80,368 |
General and administrative |
20,192 |
18,147 |
Sales and marketing |
21,126 |
18,995 |
Total costs and
expenses |
767,817 |
696,396 |
|
|
|
Operating income |
72,725 |
74,343 |
|
|
|
Non operating income: |
|
|
Interest income |
728 |
527 |
Gains (losses) on sale of securities,
net |
10,471 |
(8) |
Equity in losses of equity method
investees |
(80) |
(122) |
Foreign exchange gains, net |
1,077 |
643 |
Interest expense |
(518) |
(401) |
Other income, net |
1,091 |
418 |
|
12,769 |
1,057 |
Earnings before income
taxes |
85,494 |
75,400 |
Income tax expense |
21,591 |
19,476 |
Net income |
63,903 |
55,924 |
Net loss attributable to
noncontrolling interests |
2,695 |
5,552 |
Net income attributable to Himax
stockholders |
$66,598 |
$61,476 |
|
|
|
Basic earnings per ADS attributable
to Himax stockholders |
$0.389 |
$0.361 |
Diluted earnings per ADS attributable
to Himax stockholders |
$0.387 |
$0.358 |
|
|
|
Basic Weighted Average
Outstanding ADS |
171,095 |
170,211 |
Diluted Weighted Average
Outstanding ADS |
171,999 |
171,809 |
|
Himax Technologies,
Inc. |
Unaudited Supplemental
Financial Information |
(Amounts in Thousands
of U.S. Dollars) |
|
|
|
|
The amount of share-based
compensation included in applicable statements of income categories
is summarized as follows: |
|
|
|
|
Three
Months |
Three Months |
|
Ended December
31, |
Ended September 30, |
|
2014 |
2013 |
2014 |
Share-based compensation |
|
|
|
Cost of revenues |
$6 |
$15 |
$85 |
Research and development |
312 |
234 |
6,842 |
General and administrative |
132 |
50 |
1,456 |
Sales and marketing |
84 |
57 |
1,649 |
Income tax benefit |
(127) |
(84) |
(2,142) |
Total |
$407 |
$272 |
$7,890 |
|
|
|
|
The amount of acquisition-related
charges included in applicable statements of income categories is
summarized as follows: |
|
|
|
|
|
|
|
Acquisition-related charges |
|
|
|
Research and development |
$194 |
$436 |
$194 |
Sales and marketing |
-- |
289 |
-- |
Income tax benefit |
(83) |
(208) |
(83) |
Total |
$111 |
$517 |
$111 |
|
Himax Technologies,
Inc. |
Unaudited Supplemental
Financial Information |
(Amounts in Thousands
of U.S. Dollars) |
|
|
|
The amount of share-based
compensation included in applicable statements of income categories
is summarized as follows: |
Twelve
Months |
|
Ended
December 31, |
|
2014 |
2013 |
Share-based compensation |
|
|
Cost of revenues |
$121 |
$235 |
Research and development |
7,610 |
6,705 |
General and administrative |
1,688 |
1,308 |
Sales and marketing |
1,847 |
1,425 |
Income tax benefit |
(2,437) |
(2,170) |
Total |
$8,829 |
$7,503 |
|
|
|
The amount of acquisition-related
charges included in applicable statements of income categories is
summarized as follows: |
|
|
|
|
|
Acquisition-related charges |
|
|
Research and development |
$850 |
$1,746 |
Sales and marketing |
96 |
1,157 |
Income tax benefit |
(374) |
(835) |
Total |
$572 |
$2,068 |
|
Himax Technologies,
Inc. |
GAAP Unaudited
Condensed Consolidated Balance Sheets |
(Amounts in Thousands
of U.S. Dollars, Except Per Share Data) |
|
December
31, |
September
30, |
December
31, |
|
2014 |
2014 |
2013 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$185,466 |
$144,577 |
$127,320 |
Restricted cash and cash
equivalents |
130,179 |
140,526 |
108,399 |
Investments in marketable
securities available-for-sale |
2,377 |
3,094 |
788 |
Accounts receivable, less
allowance for doubtful accounts, sales returns and discounts |
219,368 |
218,765 |
200,725 |
Inventories |
166,105 |
157,139 |
177,399 |
Deferred income taxes |
7,740 |
7,385 |
9,974 |
Prepaid expenses and other
current assets |
18,341 |
14,568 |
15,052 |
Total current
assets |
729,576 |
686,054 |
639,657 |
Investment securities |
11,211 |
12,688 |
21,877 |
Equity method
investments |
102 |
130 |
190 |
Property, plant and equipment,
net |
57,271 |
58,390 |
60,588 |
Deferred income taxes |
477 |
3,574 |
2,135 |
Goodwill |
28,138 |
28,138 |
28,138 |
Other intangible assets,
net |
4,281 |
4,477 |
5,234 |
Other assets |
1,938 |
1,763 |
1,508 |
|
103,418 |
109,160 |
119,670 |
Total
assets |
$832,994 |
$795,214 |
$759,327 |
Liabilities, Redeemable
noncontrolling interest and |
|
|
|
Equity |
|
|
|
Current liabilities: |
|
|
|
Short-term debts |
$130,000 |
$137,500 |
$105,500 |
Accounts payable |
179,328 |
155,953 |
151,290 |
Income taxes payable |
19,050 |
16,196 |
16,932 |
Other accrued expenses and
other current liabilities |
27,027 |
26,515 |
30,111 |
Total current
liabilities |
355,405 |
336,164 |
303,833 |
Other liabilities |
5,636 |
2,898 |
3,279 |
Total
liabilities |
361,041 |
339,062 |
307,112 |
|
|
|
|
Redeemable noncontrolling
interest |
3,656 |
3,656 |
3,656 |
Equity |
|
|
|
Himax stockholders'
equity: |
|
|
|
Ordinary shares, US$0.3 par
value, 1,000,000,000 shares authorized; 356,699,482 shares issued
and 342,425,144 shares, 342,425,144 shares, 341,049,418 shares
outstanding at December 31, 2014, September 30, 2014, and December
31, 2013, respectively |
107,010 |
107,010 |
107,010 |
Additional paid-in capital |
107,808 |
107,278 |
106,636 |
Treasury shares, at cost,
14,274,338 shares, 14,274,338 shares and 15,650,064 shares at
December 31, 2014, September 30, 2014, and December 31, 2013,
respectively |
(10,144) |
(10,144) |
(11,120) |
Accumulated other comprehensive
loss |
(316) |
(460) |
(412) |
Unappropriated retained
earnings |
268,266 |
252,641 |
247,710 |
Himax stockholders'
equity |
472,624 |
456,325 |
449,824 |
Noncontrolling
interests |
(4,327) |
(3,829) |
(1,265) |
Total
equity |
468,297 |
452,496 |
448,559 |
Total liabilities,
redeemable noncontrolling |
$832,994 |
$795,214 |
$759,327 |
interest and
equity |
|
|
|
|
Himax Technologies,
Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in Thousands
of U.S. Dollars) |
|
Three
Months |
Three Months |
|
Ended December
31, |
Ended September 30, |
|
2014 |
2013 |
2014 |
|
|
|
|
Cash flows from operating
activities: |
|
|
|
Net income |
$15,138 |
$14,376 |
$10,146 |
Adjustments to reconcile net income to net
cash provided by (used in) operating activities: |
|
|
|
Depreciation and
amortization |
3,903 |
3,843 |
3,550 |
Bad debt expense |
554 |
--- |
--- |
Share-based compensation
expenses |
534 |
356 |
695 |
Gain on disposal of property
and equipment |
(2) |
--- |
--- |
Gain on disposal of equity
method investment |
--- |
(54) |
--- |
Loss on disposal of marketable
securities, net |
26 |
13 |
10 |
Valuation gain on financial
liabilities |
(1,255) |
(160) |
--- |
Impairment loss on
investment |
309 |
--- |
--- |
Equity in losses (income) of
equity method investees |
24 |
32 |
(14) |
Deferred income tax expense
(benefit) |
2,710 |
3,722 |
(300) |
Inventories write downs |
2,892 |
3,179 |
1,888 |
Changes in operating assets and
liabilities: |
|
|
|
Accounts receivable |
(1,149) |
1,503 |
(19,779) |
Inventories |
(11,858) |
(20,964) |
7,305 |
Prepaid expenses and other
current assets |
573 |
(587) |
(2,295) |
Accounts payable |
23,375 |
(11,232) |
20,083 |
Income taxes payable |
3,092 |
832 |
1,344 |
Other accrued expenses and
other current liabilities |
(184) |
3,028 |
219 |
Other liabilities |
(2) |
333 |
(3) |
Net cash provided by
(used in) operating activities |
38,680 |
(1,780) |
22,849 |
|
|
|
|
Cash flows from investing
activities: |
|
|
|
Purchase of property and
equipment |
(2,383) |
(3,925) |
(2,058) |
Proceeds from disposal of
property and equipment |
--- |
--- |
1 |
Purchase of available-for-sale
marketable securities |
(6,252) |
(6,354) |
(5,023) |
Disposal of available-for-sale
marketable securities |
6,851 |
6,344 |
5,009 |
Purchase of investment
securities |
--- |
(4,000) |
--- |
Proceeds from capital reduction
of investments |
1,168 |
--- |
--- |
Cash decrease resulting from
change in consolidated entity |
--- |
(4) |
--- |
Release (pledge) of restricted
cash equivalents and marketable securities |
2,887 |
24 |
(195) |
Increase in other assets |
(31) |
(270) |
(86) |
Net cash provided by
(used in) investing activities |
2,240 |
(8,185) |
(2,352) |
|
Himax Technologies,
Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in Thousands
of U.S. Dollars) |
|
|
|
|
|
Three
Months |
Three Months |
|
Ended December
31, |
Ended September 30, |
|
2014 |
2013 |
2014 |
Cash flows from financing
activities: |
|
|
|
Excess tax benefits from
share-based compensation |
--- |
--- |
1,232 |
Distribution of cash
dividends |
--- |
--- |
(46,042) |
Proceeds from issuance of new
shares by subsidiaries |
--- |
5,071 |
--- |
Proceeds from disposal of
subsidiary shares to noncontrolling interests by Himax Imaging,
Inc. |
18 |
--- |
2 |
Purchase of subsidiary shares
from noncontrolling |
(46) |
(896) |
(902) |
interests |
|
|
|
Release (pledge) of restricted
cash equivalents (for borrowing of short-term debt) |
7,500 |
9,500 |
(32,000) |
Proceeds from borrowing of
short-term debts |
136,000 |
19,000 |
195,000 |
Repayment of short-term
debts |
(143,500) |
(28,500) |
(163,000) |
Net cash provided by
(used in) financing activities |
(28) |
4,175 |
(45,710) |
Effect of foreign currency exchange
rate changes on cash and cash equivalents |
(3) |
20 |
(9) |
Net increase (decrease) in cash and
cash equivalents |
40,889 |
(5,770) |
(25,222) |
Cash and cash equivalents at
beginning of period |
144,577 |
133,090 |
169,799 |
Cash and cash equivalents at end of
period |
$185,466 |
$127,320 |
$144,577 |
|
|
|
|
Supplemental disclosures of cash flow
information: |
|
|
|
Cash paid during the period
for: |
|
|
|
Interest expense |
$223 |
$129 |
$139 |
Income taxes |
$84 |
$58 |
$2,328 |
Himax Technologies,
Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in Thousands
of U.S. Dollars) |
|
|
|
|
Twelve
Months |
|
Ended December
31, |
|
2014 |
2013 |
|
|
|
Cash flows from operating
activities: |
|
|
Net income |
$63,903 |
$55,924 |
Adjustments to reconcile net income to net
cash provided by operating activities: |
|
|
Depreciation and
amortization |
14,592 |
14,309 |
Bad debt expense |
554 |
173 |
Share-based compensation
expenses |
1,929 |
1,840 |
Loss (gain) on disposal of
property and equipment |
(2) |
88 |
Gain on disposal of equity
method investment |
--- |
(54) |
Gain on disposal of investment
securities, net |
(10,502) |
--- |
Loss on disposal of marketable
securities, net |
31 |
8 |
Valuation gain on financial
liabilities |
(1,255) |
(160) |
Impairment loss on
investment |
309 |
--- |
Issuance of new shares by
subsidiary for royalties |
--- |
49 |
Equity in losses of equity
method investees |
80 |
122 |
Deferred income tax
expense |
3,816 |
7,409 |
Inventories write downs |
8,198 |
10,759 |
Changes in operating assets and
liabilities: |
|
|
Accounts receivable |
(19,211) |
(65,106) |
Accounts receivable from
related parties |
--- |
73,267 |
Inventories |
3,096 |
(71,488) |
Prepaid expenses and other
current assets |
1,053 |
(1,857) |
Accounts payable |
28,038 |
15,744 |
Income taxes payable |
2,357 |
7,055 |
Other accrued expenses and
other current liabilities |
(3,262) |
2,812 |
Other liabilities |
(5) |
229 |
Net cash provided by
operating activities |
93,719 |
51,123 |
|
|
|
Cash flows from investing
activities: |
|
|
Purchase of property and
equipment |
(10,931) |
(18,412) |
Proceeds from disposal of
property and equipment |
1 |
--- |
Purchase of available-for-sale
marketable securities |
(23,766) |
(22,410) |
Disposal of available-for-sale
marketable securities |
22,021 |
21,792 |
Purchase of investment
securities |
--- |
(9,189) |
Disposal of investment
securities |
19,691 |
--- |
Proceeds from capital reduction
of investments |
1,168 |
--- |
Cash decrease resulting from
change in consolidated entity |
--- |
(4) |
Release (pledge) of restricted
cash equivalents and marketable securities |
2,697 |
(1,761) |
Increase in other assets |
(237) |
(541) |
Net cash provided by
(used in) investing activities |
10,644 |
(30,525) |
|
Himax Technologies,
Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in Thousands
of U.S. Dollars) |
|
|
|
|
Twelve
Months |
|
Ended December
31, |
|
2014 |
2013 |
Cash flows from financing
activities: |
|
|
Excess tax benefits from
share-based compensation |
1,232 |
1,271 |
Distribution of cash
dividends |
(46,042) |
(42,394) |
Proceeds from issuance of new
shares by subsidiaries |
--- |
9,852 |
Proceeds from disposal of
subsidiary shares to noncontrolling interests by Himax Technologies
Limited |
83 |
--- |
Proceeds from disposal of
subsidiary shares to noncontrolling interests by Himax Imaging,
Inc. |
38 |
64 |
Purchase of subsidiary shares
from noncontrolling |
(1,515) |
(896) |
interests |
|
|
Pledge of restricted cash
equivalents (for borrowing of short-term debt) |
(24,500) |
(32,500) |
Proceeds from borrowing of
short-term debts |
417,500 |
352,320 |
Repayment of short-term
debts |
(393,000) |
(319,820) |
Net cash used in
financing activities |
(46,204) |
(32,103) |
Effect of foreign currency exchange
rate changes on cash and cash equivalents |
(13) |
88 |
Net increase (decrease) in cash and
cash equivalents |
58,146 |
(11,417) |
Cash and cash equivalents at
beginning of period |
127,320 |
138,737 |
Cash and cash equivalents at end of
period |
$185,466 |
$127,320 |
|
|
|
Supplemental disclosures of cash flow
information: |
|
|
Cash paid during the period
for: |
|
|
Interest expense |
$592 |
$401 |
Income taxes |
$13,311 |
$3,272 |
|
Himax Technologies,
Inc. |
Non-GAAP Unaudited
Supplemental Data – Reconciliation Schedule |
(Amounts in Thousands
of U.S. Dollars) |
|
|
|
|
Gross Margin, Operating
Margin and Net Margin Excluding Share-based Compensation and
Acquisition-Related Charges: |
|
|
|
|
|
Three
Months |
Three Months |
|
Ended December
31, |
Ended September 30, |
|
2014 |
2013 |
2014 |
Revenues |
$227,179 |
$195,232 |
$222,317 |
|
|
|
|
Gross profit |
56,039 |
49,027 |
54,369 |
Add: Share-based compensation – Cost of
revenues |
6 |
15 |
85 |
Gross profit excluding share-based
compensation |
56,045 |
49,042 |
54,454 |
Gross margin excluding share-based
compensation |
24.7% |
25.1% |
24.5% |
|
|
|
|
Operating income |
22,636 |
19,406 |
12,556 |
Add: Share-based compensation |
534 |
356 |
10,032 |
Operating income excluding share-based
compensation |
23,170 |
19,762 |
22,588 |
Add: Acquisition-related charges –Intangible
assets amortization |
194 |
725 |
194 |
Operating income excluding share-based
compensation and acquisition-related charges |
23,364 |
20,487 |
22,782 |
Operating margin excluding share-based
compensation and acquisition-related charges |
10.3% |
10.5% |
10.2% |
Net income attributable to Himax
stockholders |
15,625 |
15,824 |
11,147 |
Add: Share-based compensation, net of
tax |
407 |
272 |
7,890 |
Add: Acquisition-related charges, net of
tax |
111 |
517 |
111 |
Net income attributable to Himax stockholders
excluding share-based compensation and acquisition-related
charges |
16,143 |
16,613 |
19,148 |
Net margin attributable to Himax stockholders
excluding share-based compensation and acquisition-related
charges |
7.1% |
8.5% |
8.6% |
|
|
|
|
*Gross margin excluding
share-based compensation equals gross profit excluding share-based
compensation divided by revenues |
*Operating margin excluding
share-based compensation and acquisition-related charges equals
operating income excluding share-based compensation and
acquisition-related charges divided by revenues |
*Net margin attributable to Himax
stockholders excluding share-based compensation and
acquisition-related charges equals net income attributable to Himax
stockholders excluding share-based compensation and
acquisition-related charges divided by revenues |
|
Himax Technologies,
Inc. |
Non-GAAP Unaudited
Supplemental Data – Reconciliation Schedule |
(Amounts in Thousands
of U.S. Dollars) |
|
|
|
Gross Margin, Operating
Margin and Net Margin Excluding Share-based Compensation and
Acquisition-Related Charges: |
|
|
|
|
Twelve
Months |
|
Ended December
31, |
|
2014 |
2013 |
Revenues |
$840,542 |
$770,739 |
|
|
|
Gross profit |
205,882 |
191,853 |
Add: Share-based compensation – Cost of
revenues |
121 |
235 |
Gross profit excluding share-based
compensation |
206,003 |
192,088 |
Gross margin excluding share-based
compensation |
24.5% |
24.9% |
|
|
|
Operating income |
72,725 |
74,343 |
Add: Share-based compensation |
11,266 |
9,673 |
Operating income excluding share-based
compensation |
83,991 |
84,016 |
Add: Acquisition-related charges –Intangible
assets amortization |
946 |
2,903 |
Operating income excluding share-based
compensation and acquisition-related charges |
84,937 |
86,919 |
Operating margin excluding share-based
compensation and acquisition-related charges |
10.1% |
11.3% |
Net income attributable to Himax
stockholders |
66,598 |
61,476 |
Add: Share-based compensation, net of
tax |
8,829 |
7,503 |
Add: Acquisition-related charges, net of
tax |
572 |
2,068 |
Net income attributable to Himax stockholders
excluding share-based compensation and acquisition-related
charges |
75,999 |
71,047 |
Net margin attributable to Himax stockholders
excluding share-based compensation and acquisition-related
charges |
9.0% |
9.2% |
|
|
|
*Gross margin excluding
share-based compensation equals gross profit excluding share-based
compensation divided by revenues |
*Operating margin excluding
share-based compensation and acquisition-related charges equals
operating income excluding share-based compensation and
acquisition-related charges divided by revenues |
*Net margin attributable to Himax
stockholders excluding share-based compensation and
acquisition-related charges equals net income attributable to Himax
stockholders excluding share-based compensation and
acquisition-related charges divided by revenues |
|
Diluted Earnings Per ADS
Attributable to Himax stockholders Excluding Share-based
Compensation and Acquisition-Related Charges: |
|
|
|
|
Three Months |
Twelve Months |
|
Ended December 31, |
Ended December 31, |
|
2014 |
2014 |
Diluted GAAP earning per ADS attributable to
Himax stockholders |
$0.091 |
$0.387 |
Add: Share-based compensation per ADS |
$0.002 |
$0.051 |
Add: Acquisition-related charges per ADS |
$0.001 |
$0.003 |
|
|
|
Diluted non-GAAP earning per ADS attributable
to Himax stockholders excluding share-based compensation and
acquisition-related charges |
$0.094 |
$0.442 |
|
|
|
Numbers do not add up due to rounding |
|
|
CONTACT: Company Contacts:
Jackie Chang, CFO
Himax Technologies, Inc.
Tel: 886-2-2370-3999 Ext.22300
Or
US Tel: +1-949-585-9838 Ext.252
Fax: 886-2-2314-0877
Email: jackie_chang@himax.com.tw
www.himax.com.tw
Nadiya Chen, Investor Relations
Himax Technologies, Inc.
Tel: 886-2-2370-3999 Ext.22513
Fax: 886-2-2314-0877
Email: nadiya_chen@himax.com.tw
www.himax.com.tw
Investor Relations- US Representative
Scott Powell, Managing Director
PCG Advisory Group, LLC
Tel: +1-646-780-8850
Email: spowell@pcgadvisory.com
www.pcgadvisory.com
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