TAIPEI, Taiwan, July 31, 2017 /PRNewswire/ -- GigaMedia Limited
(NASDAQ: GIGM) today announced its second-quarter 2017 unaudited
financial results.
Comments from Management
In the second quarter, the Company went through the transition
to a new CEO and the Management has been reviewing the business
strategies.
"In the past years, we could see some big fluctuation in traffic
for social games. In order not to make our business seems like it's
on the roller coaster, we now focus on seeking licensed games which
have the potentials to be long-term hits instead of the ones live
shortly like a flash in the pan.
GigaMedia will launch a new game this year and we are looking
forward to improving performance and delivering positive operating
income from mobile games which have long lifespan." said GigaMedia
Limited Chief Executive Officer James
Huang.
Second Quarter Overview
- Comparing with the same quarter of 2016, operating revenue
increased 51% and the gross profit increased 65.5% this
quarter.
- $1.75 million was received for
transferring the license right of ArcheAge to XL Games
Inc. and recorded in the non-operating income.
- Cash flow from operation was with a net inflow of $1 million.
- Total current assets increased $0.5
million and the total assets remain $70 million quarter-on-quarter.
- Short-term debt remained the same amount at approximately
$2.6 million comparing with the first
quarter of 2017 and showed a decrease of almost $3 million comparing with the same quarter of
2016.
- The net asset value was $5.4 per
share.
Unaudited Consolidated Financial Results
GigaMedia Limited is a diversified provider of online games.
GigaMedia's online games business FunTown develops and operates a
suite of games in Taiwan and
Hong Kong, with focus on
browser/mobile games and social casino games.
Unaudited consolidated results of GigaMedia are summarized in
the table below.
GIGAMEDIA2Q17
UNAUDITED CONSOLIDATED FINANCIAL RESULTS
|
(unaudited, all
figures in US$ thousands, except per share amounts)
|
|
2Q17
|
|
1Q17
|
|
Change
(%)
|
|
2Q17
|
|
2Q16
|
|
Change
(%)
|
Revenues
|
|
3,117
|
|
4,147
|
|
-24.84%
|
|
3,117
|
|
2,062
|
|
51.16%
|
Gross
Profit
|
|
1,751
|
|
2,282
|
|
-23.27%
|
|
1,751
|
|
1,058
|
|
65.50%
|
Loss from
Operations
|
|
734
|
|
429
|
|
NM
|
|
734
|
|
1,283
|
|
NM
|
Net Income (Loss)
Attributable to GigaMedia
|
|
904
|
|
(760)
|
|
NM
|
|
904
|
|
(2,146)
|
|
NM
|
Net Income (Loss) Per Share Attributable to GigaMedia, Diluted
|
|
0.08
|
|
(0.07)
|
|
NM
|
|
0.08
|
|
(0.19)
|
|
NM
|
EBITDA
(A)
|
|
812
|
|
(821)
|
|
NM
|
|
812
|
|
(2,144)
|
|
NM
|
Cash and
Marketable Securities-Current
|
|
66,452
|
|
65,354
|
|
1.68%
|
|
66,452
|
|
70,585
|
|
-5.86%
|
NM= Not
Meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A) EBITDA
(earnings before interest, taxes, depreciation, and amortization)
is provided as a supplement to results provided in accordance with
U.S. generally accepted accounting principles ("GAAP"). (See, "Use
of Non-GAAP Measures," for more details.)
|
Second-Quarter Financial Results
- Consolidated revenues for the second quarter of 2017 decreased
24.8% quarter-on-quarter from $4.1
million to $3.1 million and
increased 51.2% year-over-year from $2
million to $3.1 million.
- Consolidated gross profit decreased 23.3% quarter-on-quarter
from $2.3 million to $1.8 million and increased 65.5% year-over-year
from $1.1 million to $1.8 million.
- Consolidated operating expenses were $2.5 million in the second quarter of 2017. A
decrease of $0.2 million from the
first quarter of 2017 which reflected the decease of selling and
marketing expense.
- Consolidated loss from operation of the second quarter of 2017
was $0.7 million, slightly increased
from the first quarter of 2017. The increased loss reflected lower
proportions of game business revenues. However, a decrease of
$0.5 million was seen in
year-over-year comparison, the loss was down to $0.7 million from $1.3
million.
- Consolidated non-operating income during the second quarter of
2017 was $1.6 million compared to a
loss of $0.3 million in the first
quarter of 2017 and $0.9 million in
the second quarter of 2016. Results in the second quarter of 2017
primarily included gains from the transaction of
ArcheAge.
- Consolidated net income of the second quarter of 2017 was
$0.9 million compared to a loss of
$0.8 million in the first quarter of
2017 and a loss of $2.1 million in
the second quarter of 2016. The period variations primarily
reflected the factors affecting income from operations and
consolidated non-operating income.
- Cash and marketable securities-current in the second quarter of
2017 accounted for $66.5 million
which increased 1.68% from the first quarter of 2017.
Financial Position
GigaMedia maintained its solid financial position with cash and
cash equivalents, marketable securities-current and restricted cash
accounted for $67 million as of
June 30, 2017, or $6 per share.
Business Outlook
The following forward-looking statements reflect GigaMedia's
expectations as of July
31, 2017. Given potential changes in
economic conditions and consumer spending, the evolving nature of
online games, and various other risk factors, including those
discussed in the Company's 2016 Annual
Report on Form 20-F filed with the U.S.
Securities and Exchange Commission as referenced
below, actual results may differ materially.
Online Games Business
GigaMedia is repositioning its online games business to align
itself with steady growth in licensed games. The Company is
focusing on licensing in long-lifecycle games which allow us to
build up communities, network our customers and accumulate games
awareness; hence we will be able to maintain the stability in
revenues. Management also targets to launch a new licensed game
this year.
As for social games, the Company continues upgrading game server
system and integrating the game development environment to enhance
efficiencies and strengthen operations. One new slot game is
targeted to launch in the third quarter.
Investment
The Company continues seeking suitable strategic investment and
acquisition targets with sustainable business models worldwide to
increase corporate growth and maximize shareholder value.
Use of Non-GAAP Measures
To supplement GigaMedia's consolidated financial statements
presented in accordance with US GAAP, the Company uses the
following measure defined as non-GAAP by the SEC: EBITDA.
Management believes that EBITDA (earnings before interest, taxes,
depreciation, and amortization) is a useful supplemental measure of
performance because it excludes certain non-cash items such as
depreciation and amortization and that EBITDA is a measure of
performance used by some investors, equity analysts and others to
make informed investment decisions. EBITDA is not a recognized
earnings measure under GAAP and does not have a standardized
meaning. Non-GAAP measures such as EBITDA should be considered in
addition to results prepared in accordance with GAAP, but should
not be considered a substitute for, or superior to, other financial
measures prepared in accordance with GAAP. A limitation of using
EBITDA is that it does not include all items that impact the
company's net income for the period. Reconciliations to the GAAP
equivalents of the non-GAAP financial measures are provided on the
attached unaudited financial statements.
About the Numbers in This Release
Quarterly results
All quarterly results referred to in the text, tables and
attachments to this release are unaudited. The financial statements
from which the financial results reported in this press release are
derived have been prepared in accordance with U.S. GAAP, unless
otherwise noted as "non-GAAP," and are presented in U.S.
dollars.
Q&A
For Q&A regarding the second quarter 2017 performance upon
the release, investors may send the questions via email to
IR@gigamedia.com.tw, and the responses will be replied
individually.
About GigaMedia
Headquartered in Taipei,
Taiwan, GigaMedia Limited (Singapore registration number: 199905474H) is
a diversified provider of online games. GigaMedia's online games
business develops and operates a suite of games in Taiwan and Hong
Kong, with focus on browser/mobile games and social casino
games. More information on GigaMedia can be obtained from
www.gigamedia.com.
The statements included above and elsewhere in this press
release that are not historical in nature are "forward-looking
statements" within the meaning of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include statements regarding expected
financial performance (as described without limitation in the
"Business Outlook" section and in quotations from management in
this press release) and GigaMedia's strategic and operational
plans. These statements are based on management's current
expectations and are subject to risks and uncertainties and changes
in circumstances. There are important factors that could cause
actual results to differ materially from those anticipated in the
forward looking statements, including but not limited to, our
ability to license, develop or acquire additional online games that
are appealing to users, our ability to retain existing online game
players and attract new players, and our ability to launch online
games in a timely manner and pursuant to our anticipated schedule.
Further information on risks or other factors that could cause
results to differ is detailed in GigaMedia's Annual Report on Form
20-F filed in April 2017 and its
other filings with the United States Securities and Exchange
Commission.
GIGAMEDIA
LIMITED
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
|
Three months
ended
|
|
|
6/30/2017
|
|
03/31/2017
|
|
6/30/2016
|
|
|
unaudited
|
|
unaudited
|
|
unaudited
|
|
|
USD
|
|
USD
|
|
USD
|
Operating
revenues
|
|
|
|
|
|
|
Asian online game and
service revenues
|
|
3,117,035
|
|
4,147,068
|
|
2,061,392
|
Other
revenues
|
|
-
|
|
-
|
|
283
|
|
|
3,117,035
|
|
4,147,068
|
|
2,061,675
|
Operating
costs
|
|
|
|
|
|
|
Cost of Asian online
game and service revenues
|
|
1,366,009
|
|
1,864,588
|
|
1,003,828
|
Cost of other
revenues
|
|
-
|
|
-
|
|
296
|
|
|
1,366,009
|
|
1,864,588
|
|
1,004,124
|
Gross
profit
|
|
1,751,026
|
|
2,282,480
|
|
1,057,551
|
Operating
expenses
|
|
|
|
|
|
|
Product development
and engineering expenses
|
|
288,371
|
|
276,697
|
|
167,563
|
Selling and marketing
expenses
|
|
1,174,915
|
|
1,470,628
|
|
1,426,594
|
General and
administrative expenses
|
|
1,021,624
|
|
964,524
|
|
746,910
|
Other
|
|
-
|
|
-
|
|
-
|
|
|
2,484,910
|
|
2,711,849
|
|
2,341,067
|
Loss from
operations
|
|
(733,884)
|
|
(429,369)
|
|
(1,283,516)
|
Non-operating
income (expense)
|
|
|
|
|
|
|
Interest
income
|
|
108,580
|
|
77,174
|
|
80,925
|
Interest
expense
|
|
(11,717)
|
|
(11,730)
|
|
(25,981)
|
Foreign exchange
(loss) gain - net
|
|
(74,523)
|
|
(377,450)
|
|
(94,062)
|
(Loss) Gain on
disposal of property, plant and equipment
|
|
965
|
|
-
|
|
8,090
|
Equity in net loss on
equity method investments
|
|
(311)
|
|
(23,265)
|
|
(858,492)
|
Gain on disposal of
investments
|
|
-
|
|
-
|
|
8,567
|
Impairment loss on
marketable securities and investments
|
|
(52,242)
|
|
-
|
|
-
|
Other -
net
|
|
1,667,257
|
|
5,501
|
|
15,237
|
|
|
1,638,009
|
|
(329,770)
|
|
(865,716)
|
(Loss) Income from continuing operations before income taxes
|
|
904,125
|
|
(759,139)
|
|
(2,149,232)
|
Income tax benefit
(expense)
|
|
-
|
|
(456)
|
|
2,961
|
(Loss) Income from
continuing operations
|
|
904,125
|
|
(759,595)
|
|
(2,146,271)
|
Net (loss)
income
|
|
904,125
|
|
(759,595)
|
|
(2,149,271)
|
Less: Net loss
attributable to noncontrolling interest
|
|
|
|
-
|
|
-
|
Net (loss) income
attributable to shareholders of GigaMedia
|
|
904,125
|
|
(759,595)
|
|
(2,149,271)
|
(Loss) Earnings per
share attributable to GigaMedia
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
(Loss) Income from
continuing operations
|
|
0.08
|
|
(0.07)
|
|
(0.19)
|
Loss from
discontinued operations
|
|
0.00
|
|
0.00
|
|
0.00
|
|
|
0.08
|
|
(0.07)
|
|
(0.19)
|
Diluted:
|
|
|
|
|
|
|
(Loss) Income from
continuing operations
|
|
0.08
|
|
(0.07)
|
|
(0.19)
|
Loss from
discontinued operations
|
|
0.00
|
|
0.00
|
|
0.00
|
|
|
0.08
|
|
(0.07)
|
|
(0.19)
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
Basic
|
|
11,052,235
|
|
11,052,235
|
|
11,052,332
|
Diluted
|
|
11,052,235
|
|
11,052,235
|
|
11,052,235
|
GIGAMEDIA
LIMITED
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
6/30/2017
|
|
3/31/2017
|
|
6/30/2016
|
|
|
unaudited
|
|
audited
|
|
unaudited
|
|
|
USD
|
|
USD
|
|
USD
|
Assets
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
66,449,544
|
|
65,351,207
|
|
70,581,209
|
Marketable securities
- current
|
|
2,617
|
|
2,617
|
|
3,830
|
Accounts receivable -
net
|
|
724,508
|
|
1,247,420
|
|
820,603
|
Prepaid
expenses
|
|
510,432
|
|
493,229
|
|
488,851
|
Restricted
cash
|
|
503,640
|
|
500,000
|
|
1,004,110
|
Other
receivables
|
|
913,366
|
|
949,225
|
|
30,059
|
Other current
assets
|
|
146,242
|
|
176,686
|
|
192,924
|
Total current
assets
|
|
69,250,349
|
|
68,720,384
|
|
73,121,586
|
|
|
|
|
|
|
|
Marketable securities
- noncurrent
|
|
|
|
|
|
|
Investments
|
|
-
|
|
52,790
|
|
3,720,766
|
Property, plant &
equipment - net
|
|
29,445
|
|
22,434
|
|
400,831
|
Intangible assets -
net
|
|
4,848
|
|
4,824
|
|
111,064
|
Prepaid licensing and
royalty fees
|
|
389,886
|
|
904,404
|
|
912,055
|
Other
assets
|
|
384,468
|
|
367,749
|
|
414,857
|
Total
assets
|
|
70,058,996
|
|
70,072,585
|
|
78,681,159
|
|
|
|
|
|
|
|
Liabilities and
equity
|
|
|
|
|
|
|
Short-term
borrowings
|
|
2,629,849
|
|
2,637,652
|
|
5,577,072
|
Accounts
payable
|
|
291,215
|
|
434,631
|
|
272,203
|
Accrued
compensation
|
|
375,393
|
|
225,287
|
|
392,706
|
Accrued
expenses
|
|
2,628,643
|
|
3,332,207
|
|
2,560,114
|
Unearned
revenue
|
|
2,111,474
|
|
2,150,001
|
|
1,661,640
|
Other current
liabilities
|
|
169,352
|
|
404,262
|
|
1,614,011
|
Total current
liabilities
|
|
8,205,926
|
|
9,184,040
|
|
12,077,746
|
Other
liabilities
|
|
1,671,511
|
|
1,671,511
|
|
1,712,015
|
Total
liabilities
|
|
9,877,437
|
|
10,855,551
|
|
13,789,761
|
GigaMedia's
shareholders' equity
|
|
60,181,559
|
|
59,217,034
|
|
64,891,398
|
Noncontrolling
interest
|
|
-
|
|
-
|
|
-
|
Total
equity
|
|
60,181,559
|
|
59,217,034
|
|
64,891,398
|
Total liabilities and
equity
|
|
70,058,996
|
|
70,072,585
|
|
78,681,159
|
GIGAMEDIA
LIMITED
|
RECONCILIATIONS OF
NON-GAAP RESULTS OF OPERATIONS
|
|
|
Three months
ended
|
|
|
6/30/2017
|
|
3/31/2017
|
|
6/30/2016
|
|
|
unaudited
|
|
unaudited
|
|
unaudited
|
|
|
USD
|
|
USD
|
|
USD
|
Reconciliation of
Net Income (Loss) to EBITDA
|
|
|
|
|
|
|
Net income (loss)
attributable to GigaMedia
|
|
904,125
|
|
(759,595)
|
|
(2,146,271)
|
Depreciation
|
|
1,657
|
|
953
|
|
29,306
|
Amortization
|
|
3,005
|
|
2,798
|
|
30,947
|
Interest
income
|
|
(108,580)
|
|
(77,174)
|
|
(80,925)
|
Interest
expense
|
|
11,717
|
|
11,730
|
|
25,981
|
Income tax (benefit)
expense
|
|
-
|
|
456
|
|
(2,961)
|
EBITDA
|
|
811,924
|
|
(820,832)
|
|
(2,143,923)
|
For further information contact:
Annie Sun
Investor Relations Department
Country/City Code 8862 Tel: 2656-8096
IR@gigamedia.com.tw
View original
content:http://www.prnewswire.com/news-releases/gigamedia-announces-second-quarter-2017-financial-results-300496493.html
SOURCE GigaMedia