Company
Meets Q2 2017
Revenue and GAAP EPS
Guidance, and Exceeds
Gross Margin Guidance
Himax Technologies, Inc. (Nasdaq:HIMX) (“Himax” or “Company”), a
leading supplier and fabless manufacturer of display drivers and
other semiconductor products, announced its financial results for
the second quarter ended June 30, 2017.
Himax recorded net revenues of $151.7 million
with a gross margin of 23.8% and GAAP loss per diluted ADS was 0.4
cents in the second quarter. Revenue and GAAP loss per diluted ADS
were within the Company’s guidance while gross margin exceeded the
guidance previously issued as of May 11th. “The second quarter
revenues of $151.7 million represented a decrease of 2.2%
sequentially and a decrease of 24.5% year-over-year. Despite the
decline in the first half in our business, we expect a strong
recovery in driver ICs segment and exciting opportunities in the
non-driver segments over the remainder of 2017 and beyond. We
believe our overall financial performance will be resilient,” said
Mr. Jordan Wu, President and Chief Executive Officer of Himax.
Mr. Wu said, “We have refreshed our product
roadmap and delivered better product cost to our existing and newly
added customers in the large display driver IC segment. Moreover,
sales into smartphones already rebounded in June as customers have
started to replenish inventories for new product release. Our FHD+
solutions for 18:9 displays and TDDI have drawn tremendous
interests from top tier brands, not to mention that our discrete
touch panel controller ICs and driver ICs for automotive
applications continue to grow strongly in the small-and-medium
display driver segment. Last but not the least, we have delivered
AMOLED product samples to some customers in the second quarter.”
Mr. Wu continued, “Judging by the on-going design-in activities and
schedules of mass shipment for key projects across all product
lines, we have high confidence that our display driver IC business
will resume strong growth momentum in the second half.“
“We are also optimistic about the growth
prospects for our non-driver business, most notably with our
industry leading structure light integrated solution for 3D sensing
and WLO. Our 3D sensing solution consists of several critical
in-house technologies, including advanced optics utilizing our
world leading WLO technology, laser driver IC, high precision
active alignment for the projector assembly, high performance
near-infrared CMOS image sensor and an ASIC chip for 3D depth map
generation. These building blocks enable us to react quickly and
tailor our solutions to customers’ specific needs. While we prefer
to offer a total solution, we can also provide those critical
in-house technologies individually to select customers so as to
best accommodate their specific needs. We are in close
collaboration with select leading smartphone makers and partners,
aiming to bring our total solution to mass production as early as
early 2018 to meet our top-tier customers' aggressive launch
timetables. 3D sensing total solution represents a very high entry
barrier for potential competition and much higher ASP for Himax. By
the time we start shipping our total solutions, it will contribute
greatly to our revenue and profit, and consequently a more
favorable product mix for us,” said Mr. Wu.
“In the last earnings call, we reported that
this year’s capex will be significantly higher than usual. We also
reported the urgent addition of new WLO capacity to meet the rush
demand of a certain customer. This new capacity is located in our
existing headquarters in which we retrofitted space to make room
for the new equipment. The project is going smoothly as planned. A
major ramp of the new WLO capacity has already started at the
beginning of the third quarter and will accelerate throughout the
remainder of 2017 and beyond,” Mr. Wu continued.
Advanced wafer-level optics (WLO) is one of the
key technologies enabling 3D sensing, which is the top priority of
Himax’s WLO business. Mr. Wu said, “Leveraging on our exceptional
design know-how and mass production experience in WLO technology,
we are able to produce the world’s most compact optics required of
3D sensing while achieving superior performance. In addition to 3D
sensing, we also have ongoing collaborations with customers in
developing light-guide for AR glasses and micro displays using our
WLO technology.”
Mr. Wu further said, “For the other major capex
project of this year, we reported the construction of a new
building is going well and everything is proceeding according to
schedule. The new building, located near our current headquarters,
will house additional 8” glass WLO capacity and provide the extra
office space we desperately need. The new building will be
completed and ready for personnel and equipment move-in by the end
of 2017 or early 2018. Its timely completion is particularly
critical for our 3D sensing total solution business as it will
house the new WLO capacity needed for multiple smartphone
customers.”
“Judging from our customers’ enthusiasm, we are
planning to kick-start the phase II capital expansion beyond the
phase I’s $80 million mark that we announced earlier much sooner
than expected in order to fulfill the strong 3D sensing demand for
the next 2-3 years. The phase II capacity will still be located in
the new building, which has sufficient room to house capacity much
in excess of the phase II expansion. We expect the phase II
investment to provide a handsome return and will entrench Himax as
top tier customers’ 3D sensing go-to supplier for our leading
technology and reliable capacity support in this up and coming
industry with tremendous growth potential,” said Mr. Wu.
With regards to CMOS Image Sensor, Himax said
its NIR sensor is a critical part in its structured light 3D
sensing total solution. Its NIR sensors deliver superior quantum
efficiency in the NIR range, especially over 940nm band which is
critical for outdoor applications. On the LCOS product line, in
addition to AR application, Himax said it’s making great progress
in developing high-end head-up-display for automotive
applications.
Second Quarter 2017 Revenue Breakdowns
by Product Line
The second quarter revenues of $151.7 million
represented a decrease of 2.2% sequentially, and 24.5%
year-over-year. Revenue from large panel display drivers was $52.1
million, down 12% sequentially, and down 22.8% year-over-year.
Large panel driver ICs accounted for 34.4% of the Company’s total
revenues for the second quarter, compared to 38.2% in the first
quarter of 2017 and 33.6% a year ago. The decline was due to a
temporary slowdown of the Company’s large size driver IC business
caused by earlier misses of certain customers’ new design-in
projects as Himax has reported in last quarter’s earnings call. The
Company said it has overcome the engineering hiccup and business
will be back on track starting the third quarter. Himax’s
engineering collaboration and design-in activities with large panel
customers across China, Taiwan and Korea all remain robust in spite
of the lukewarm sales in the first half of 2017. Himax expects such
activities will lead to future rebound in sales growth
momentum.
Revenue for small and medium-sized drivers was
$70.0 million, up 5.1% sequentially and down 22.7% from the same
period last year. Driver ICs for small and medium-sized
applications accounted for 46.1% of total sales for the second
quarter, as compared to 42.9% in the first quarter of 2017 and
45.0% a year ago. Sales into smartphones increased 2.5%
sequentially and down 51.5% year-over-year. The less than
satisfactory result in the second quarter was caused mainly by weak
sentiment in the China market since most brands were preparing for
new models based on 18:9 displays, and therefore turned cautious in
building inventory for legacy 16:9 displays. In addition, Himax’s
sales were affected by the shrinking addressable market for pure
TFT-LCD driver ICs, a portion of which is being replaced by TDDI
and AMOLED technologies as the Company indicated in the previous
earnings calls. As Chinese OEM customers began to replenish
inventory for the new release in the second half, Himax has seen
strong recovery in third quarter.
Sales into automotive application increased
15.6% sequentially and 50.6% year-over-year. The Company continues
to see strong momentum in this space. Sales into tablets increased
around 8.0% sequentially but declined 13.7% year-over-year for weak
overall market demand in the product segment.
Revenues from non-driver businesses were $29.6
million, up 0.9% sequentially and down 31.1% versus last year.
Non-driver products accounted for 19.5% of total revenues, as
compared to 18.9% in the first quarter of 2017 and 21.4% a year
ago. The sequential increase was primarily due to NRE contribution.
The year-over-year declines were due to discontinuation of LCOS and
WLO shipments to one of the Company’s major AR device customers who
decided to end the product’s production as Himax reported before.
To a much lesser extent, lower sales of touch panel controllers and
power management ICs also contributed to the year-over-year
decline.
GAAP gross margin for the second quarter was
23.8%, up 70 basis points from 23.1% in the first quarter and down
230 basis points from 26.1% for the same period last year. The
sequential increase was a result of a more favorable product mix
and higher NRE. The year-over-year decline was primarily caused by
unfavorable product mix and margin decline in the driver ICs
product lines.
GAAP operating expenses were $37.1 million in
the second quarter of 2017, up 8.1% from the preceding quarter and
up 21.4% from a year ago. The sequential and year-over-year
increases in the second quarter are in line with the operating
expense budget that the Company reported in the last earnings call.
The sequential increase was primarily the result of rising R&D
expenses in the areas of 3D sensing, WLO, TDDI, and high-end TV.
The year-over-year increase, on top of the same reasons above, was
also caused by the annual merit increases. In addition, NT dollar
appreciation against the US caused the Company’s salary expenses to
increase around $1 million as it pays the bulk of its employee
salaries in NT dollars.
GAAP operating margin for the second quarter of
2017 was -0.6%, down from 10.9% for the same period last year and
down from 1.0% in the previous quarter. The sequential decline was
a result of lower sales and higher expenses in the quarter and the
year-over-year decrease was a result of lower sales, lower gross
margin and higher expenses.
Second quarter non-GAAP operating loss was $0.4
million, or -0.3% of sales, down from 11.1% for the same period
last year and down from 1.3% a quarter ago. Again, the sequential
decline was a result of lower sales and higher expenses in the
quarter while year-over-year decrease was caused by lower sales,
lower gross margin and higher expenses.
GAAP net loss for the second quarter was $0.6
million, or 0.4 cents per diluted ADS, compared to GAAP net income
of $1.4 million, or 0.8 cents per diluted ADS, in the previous
quarter and GAAP net income of $19.8 million, or 11.5 cents per
diluted ADS, a year ago.
Second quarter non-GAAP net loss was $0.3
million, or 0.2 cent per diluted ADS, compared to non-GAAP net
income of $1.7 million last quarter and non-GAAP net income of
$20.2 million the same period last year.
Balance Sheet and Cash Flow
Himax had $185.9 million of cash, cash
equivalents and marketable securities as of the end of June 2017,
compared to $179.3 million at the same time last year and $199.5
million a quarter ago. On top of the above cash position,
restricted cash was $107.2 million at the end of the quarter, as
compared to $107.4 million in the preceding quarter and down from
$138.0 million a year ago. The restricted cash is mainly used to
guarantee the Company’s short-term loan for the same amount. Himax
continues to maintain a very strong balance sheet and remain a
debt-free company.
Himax’s inventories as of June 30, 2017 were
$147.7 million, little changed from $148.3 million a quarter ago
and decreased from $186.7 million at the same time last year.
Accounts receivable at the end of June 2017 were $163.2 million as
compared to $187.9 million a year ago and $167.7 million last
quarter. DSO was 96 days at the end of June 2017, as compared to 90
days a year ago and 97 days at end of the last quarter.
Net cash outflow from operating activities for
the second quarter was $1.2 million as compared to an inflow of
$13.1 million for the same period last year and an inflow of $5.5
million last quarter. The sequential decrease was mainly due to an
income tax payment of $8.0 million and year-over-year decrease was
the result of lower profitability.
The company’s second quarter’s capital
expenditures were $11.9 million versus $1.7 million a year ago and
$2.0 million last quarter. The second quarter capex consisted
mainly of capacity expansion for WLO production lines and ongoing
payment for the new buildings construction. As reported in the last
few earnings calls, the Company is increasing capex right now to
enlarge its WLO capacity within the current headquarters to meet
certain anchor customer's strong and urgent demand. Himax is also
constructing a new building to house further WLO capacity, the next
generation LCOS production line, and additional office spaces. This
is the Company’s phase I expansion which is $80 million as the
Company announced in the last earnings call.
Share Buyback Update
As of June 30, 2017, Himax had 172.0 million ADS
outstanding, unchanged from last quarter. On a fully diluted basis,
the total ADS outstanding are 172.5 million.
Fiscal Year 2016 Dividend
Declaration
During the second quarter, the Company declared
an annual cash dividend of 24 cents per ADS, totaling $41.3
million, which will be paid out on August 14. Himax’s dividend is
determined primarily by the prior year’s profitability. Himax’s
decision to pay out 81.4% of last year’s net profit demonstrates
the Company’s continued support for its shareholder base and strong
confidence in the near term return outlook for the Company’s newly
increased capex and its overall long-term growth prospect.
2017 Investor Outreach and
Conferences
Ms. Jackie Chang, CFO, Ms. Ophelia Lin, internal
IR Deputy Director, Mr. Ken Liu, internal IR, and Mr. Greg
Falesnik, Himax’s US-based IR, will maintain corporate access for
shareholders and attend future investor conferences. If you are
interested in speaking with the management, please contact Himax’s
US or Taiwan-based investor relations contact at the numbers
below.
Business Updates
Despite the decline in the first half in its
business, Himax anticipates a strong recovery in driver ICs segment
and exciting opportunities in the non-driver segments over the
remainder of 2017 and beyond. The Company believes its overall
financial performance will be resilient based on the developing
trends that Himax sees in its businesses.
Display driver IC marketHimax
has positive outlook on the growth momentum in its large display
driver IC business. While the global TV shipments may experience
0.4% year-over-year decline, China's share of the global TV panel
shipments is projected to reach 33% in 2017, compared to 29.5% in
2016. Being a market leader in the large display driver IC business
in China, the Company will capitalize on China’s rising market
share. Not only has the Company refreshed its product roadmap and
delivered better product costs to its existing and newly added
customers, the Company has also secured new design-wins,
particularly in 4K TV, to solidify its growth for the remainder of
the year.
Looking forward, 4K TV penetration is still on
the rise and Chinese panel customers are still ramping new advanced
generation fabs over the next few years, including a brand new Gen
8.5 fab and another Gen 8.6 during the second quarter of 2017. This
will help further grow the Company’s revenue and market share in
the large panel segment in 2018.
In the small and medium-sized panel segments,
the Company’s driver IC sales for automotive applications have
enjoyed over 30% annual growth over the last few years, well
surpassing the market average. Still more panels are going into
vehicles, with the number of units expected to increase from 135
million in 2016 to 200 million in 2022. Himax has successfully
engaged literally all of the major automotive panel manufacturers
worldwide for long-term partnerships and secured many of their key
projects pipelined for the next few years.
The most significant segment in Himax’s small
and medium-sized panel driver IC business is ICs used for
smartphones. The Company’s customers have started to replenish
inventories after the lackluster first half of the year and Himax
has added more design-wins for 18:9 displays. Sales into
smartphones already rebounded in June and the Company expects a
strong recovery into the third and fourth quarter.
In the last earnings call, Himax management
discussed how 18:9 displays are becoming a trend and how the
Company expects higher TDDI penetration in smartphones going
forward. Both of these trends held true and continued to accelerate
in the second quarter. In order to increase the effective viewing
area of the display without enlarging the overall size of the
phone, new aspect ratios and bezel-less designs are essential. Most
of the brands are now preparing for the change into new displays
featuring the FHD+ and HD+ resolutions, which have an aspect ratio
of around 18:9 to 21:9. Himax predicted this market shift and has
been working hard to get itself ready for this new trend. The
Company has been awarded several important projects for major
brands. Many design-in activities are ongoing and the Company is
already starting mass shipments for some of the projects, helping
boost the third quarter revenue for the segment.
In terms of Himax’s progress in TDDI, the
Company reported in the last earnings call that it made further
investments into R&D and customer engineering to catch up with
its customers’ requests for fast product ramps. The Company is
pleased to report that its FHD+ TDDI solutions have drawn
tremendous interests from tier-1 brands and most panel makers in
China, Japan and Korea, primarily because its TDDI solutions enable
super-slim bezels for its customers’ panel design. Himax expects
its new FHD+ TDDI solutions to be a significant contributor to the
Company’s revenues in the fourth quarter and beyond.
While the discrete touch panel controller IC is
being quickly replaced by TDDI, the Company expects this product’s
revenue will grow over 40% in the third quarter as some of the
earlier design-in projects featuring Himax’s on-cell solutions
started volume shipments for Chinese smartphone brands.
For AMOLED displays. The Company has joint
development projects with many of the major Chinese OLED panel
customers and has delivered product samples to some of them in the
second quarter. With Chinese smartphone brands’ AMOLED adoption
forecast to reach 18% in 2017, Chinese panel makers have committed
tremendous capital to build 7 to 10 brand new OLED fabs and are
driving at full speed to pull forward the mass production schedule.
AMOLED is set to become mainstream in the global smartphone market
in the near future with penetration potentially reaching as high as
50% by 2020. Once the Chinese panel makers start to mass produce
OLED displays, Himax believes OLED driver IC will be one of the
growth engines for its small panel driver IC business.
Non-Driver Product
CategoriesThe non-driver IC business segment has been the
Company’s most exciting growth area and a differentiator for Himax
in the past few years. Below is some of the exciting progress the
Company made in the last quarter, as well as future growth
opportunities.
3D Sensing Total Solution The
Company believes 3D sensing is among the most significant new
features for the next generation smartphone. The Company’s SLiM™
product line, based on structured light technology, is a state of
the art total solution for 3D sensing. Himax’s goal is to provide
total solutions with performance, size, power consumption and costs
all suitable for smartphones and tablets. Himax offers fully
integrated structure light modules, with the vast majority of the
key technologies inside the module also developed and supplied by
the Company. These critical in-house technologies include advanced
optics utilizing the Company’s world leading WLO technology, laser
driver IC, high precision active alignment for the projector
assembly, high performance near-infrared CMOS image sensor and,
last but not least, an ASIC chip for 3D depth map generation. The
fact that all of these critical building blocks are developed
in-house puts the Company in a unique position. Himax is able to
react quickly and tailor its solutions to customers’ specific
needs. It also represents a very high barrier of entry for any
potential competition and a much higher ASP for the Company. While
the Company prefers to offer a total solution, it can also provide
the aforementioned individual technologies separately to select
customers so as to best accommodate their specific needs.
Thanks to the Company’s absolute technology
leadership, its progress made with the fully integrated structure
light 3D sensing total solution module is very exciting. Himax is
seeing strong demand for 3D sensing solutions from numerous tier 1
customers. The Company is in close collaboration with select
leading smartphone makers and partners right now, aiming to bring
its total solution to mass production as early as early 2018 to
meet the customers' aggressive launch timetables. Moreover, given
that the Company is offering highly integrated solutions with ASPs
much higher than those of individual components, by the time the
Company starts shipping its total solutions, they will be a major
contributor to both Himax’s revenues and profit, and consequently
create a more favorable product mix for the Company.
Furthermore, 3D sensing will be a game changing
technology for a wide range of applications. The smartphone space
is the Company’s current focus, however, Himax believes over time
it will be a necessary feature for applications such as AR/VR,
industrial, IoT, AI, automotive, robotics, military, surveillance
and drones.
WLOIn the last earnings call,
the Company reported that this year’s capex will be significantly
higher than usual. Himax also reported the urgent addition of new
WLO capacity to meet the rush demand of a certain customer.
This new capacity is located in Himax’s existing headquarters in
which it retrofitted space to make room for the new equipment. The
Company is pleased to report that the project is going smoothly as
planned. A major ramp of the new WLO capacity has already started
at the beginning of the third quarter of 2017 and will accelerate
throughout the remainder of 2017 and beyond.
On to other WLO business updates. Advanced
wafer-level optics (WLO) is one of the key technologies enabling 3D
sensing, AR devices, and many other applications. At the present
time, 3D sensing is the top priority of the Company’s WLO business.
Leveraging on the Company’s exceptional design know-how and mass
production experience in WLO technology, the Company is able to
produce the world’s most compact optics required of 3D sensing
while achieving superior performance. In addition to 3D sensing,
Himax also has ongoing collaborations with customers in developing
light-guide for AR glasses and micro displays using its WLO
technology.
New BuildingMoving on to the
other major capex project of this year, the construction of a new
building. The progress has been good to date and everything is
proceeding according to schedule. The new building, located near
the Company’s current headquarters, will house additional 8” glass
WLO capacity and provide the extra office space Himax desperately
needs. The new building will be completed and ready for personnel
and equipment move-in by the end of 2017 or early 2018. Its timely
completion is particularly critical for the Company’s 3D sensing
total solution business as it will house the new WLO capacity
needed for multiple smartphone customers.
Phase II capexJudging from the
Company’s customers’ enthusiasm, Himax is planning to kick-start
the phase II capital expansion beyond the phase I’s $80 million
mark that it announced earlier much sooner than expected in order
to fulfill the strong customer 3D sensing demand for the next 2-3
years. The phase II capacity will still be located in the new
building. The new building has sufficient room to house capacity
much in excess of the phase II expansion. The Company expects the
phase II investment to provide a handsome return and will entrench
Himax as top tier customers’ 3D sensing go-to supplier for its
leading technology and reliable capacity support in this up and
coming industry with tremendous growth potential. Among all the
components of the Company’s 3D sensing total solution, the only two
items requiring capital expenditure for the Company are advanced
optics, utilizing the Company’s in-house WLO production line, and
active alignment for which Himax has developed a state-of-the-art
solution. The two items are not outsourced because they require
highly differentiating manufacturing know-how and are critical
factors of Himax’s competitiveness. Himax will report a phase II
capex plan in due course.
CMOS Image SensorHimax
continues to make great progress with its two machine vision sensor
product lines, namely, near infrared (“NIR”) sensor and
Always-on-Sensor (“AoS™”). The Company’s NIR sensor is a critical
part in the structured light 3D sensing total solution. The
Company’s NIR sensors’ overall performance is far ahead of those of
its peers in 3D sensing applications. Himax currently offers low
noise HD, or 1 megapixel, and 5.5 megapixel NIR sensors and is
planning to add more to further enrich its product portfolio.
Himax’s NIR sensors deliver superior quantum efficiency in the NIR
range, especially over 940nm band which is critical for outdoor
applications.
The Company’s AoS solutions provide super low
power computer vision, which enables new applications across a wide
variety of industries. The ultra-low power, always-on vision sensor
is a powerful solution capable of detecting, tracking and
recognizing its environment in an extremely efficient manner using
just a few milliwatts of power. The Company is pleased to report
that it already has one major global brand leveraging its AoS in
their new high end TV models, which have already hit the
market.
For the traditional human vision segments, Himax
sees strong demand in notebooks and increased shipments for
multimedia applications such as car recorders, surveillance,
drones, home appliances, and consumer electronics, among
others.
ASICOne of the critical
elements of Himax’s 3D sensing total solution is an ASIC for 3D
depth map generation. The Company is able to develop the ASIC
thanks to its unique in-house capability in developing video ASICs
for customers. Equipped with the ASIC, Himax’s 3D sensing total
solution can substantially reduce the power consumed while
processing 3D sensing, enhance personal data security, accelerate
the 3D depth map generation, and free up a smartphone’s processor
for other applications. Himax views this unique capability as a
significant competitive advantage. It has been and will continue to
be one of the Company’s key drivers in the success of its 3D
sensing total solution.
LCOSTurning to the LCOS update.
Even though the market is still in development stage, the Company
continues to see heavyweight companies allocating major R&D
resources and budgets in their push for AR goggle devices. Himax’s
list of customers continues to expand and it now covers many of the
world’s biggest tech names. In addition to AR applications, the
Company is pleased to report that it is making great progress in
developing high-end heads-up-displays for automotive applications.
This represents a significant long term growth opportunity for
Himax.
The Company’s technology leadership in this
space has little competition, which is evidenced by its
partnerships with tier 1 companies who have launched their AR
products with Himax inside, as well as the Company’s partnerships
with the world’s leading AR glasses producers.
Third Quarter 2017
Guidance
The Company is providing the following financial
guidance for the third quarter of 2017:
Net Revenue: |
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To increase 23.0% to
30.0% sequentially |
Gross Margin: |
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To be up 1%
sequentially |
GAAP EPS: |
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1.3 to 2.5 cents per
diluted ADS, as compared to -0.4 cents reported in 2Q 2017 |
Non GAAP EPS(1): |
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3.0 to 4.2 cents per
diluted ADS, as compared to -0.2 cents reported in 2Q 2017 |
(1)
Non-GAAP EPS excludes share-based compensation and
acquisition-related charges |
For the third quarter, of the three product
categories, the Company expects large panel driver IC to increase
around 10% quarter-over-quarter; those for small and medium-sized
panels to be up by around 20% sequentially; Non-driver IC
business is expected to increase around 90% sequentially.
As the Company has done in the past, its third
quarter GAAP earnings per diluted ADS guidance has taken into
account its expected 2017 grant of restricted share units, or RSUs,
to Himax’s team at the end of September. The 2017 RSUs, subject to
its Board approval, is now assumed to be around $3.0 million,
almost all of which, or 1.5 cents per diluted ADS, will be vested
and expensed immediately on September 30th, the grant date. In
comparison, the 2016 RSUs totaled $12.0 million, out of which $9.2
million, or 4.3 cents per diluted ADS, was vested immediately. The
grant of RSUs would lead to higher third quarter GAAP operating
expenses compared to the other quarters of the year.
HIMAX TECHNOLOGIES SECOND QUARTER 2017
EARNINGS CONFERENCE CALL
DATE: |
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Thursday, August 3,
2017 |
TIME: |
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U.S.
8:00 a.m. EDT |
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Taiwan
8:00 p.m. |
DIAL
IN: |
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U.S.
+1 (866) 444-9147 |
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INTERNATIONAL +1 (678) 509-7569 |
CONFERENCE
ID |
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48224812 |
WEBCAST: |
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http://edge.media-server.com/m/p/v9strux6 |
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A replay of the call will be available beginning
two hours after the call through 11:59 p.m. U.S. EDT on August 10,
2017 (11:59 a.m. Taiwan time, August 11, 2017) on www.himax.com.tw
and by telephone at +1 (855) 859-2056 (U.S. Domestic) or +1 (404)
537-3406 (International). The conference ID number is 48224812.
This call is being webcast by Nasdaq and can be accessed by
clicking on this link or Himax’s website, where the webcast can be
accessed through August 2, 2018.
About Himax Technologies, Inc. Himax
Technologies, Inc. (NASDAQ: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, virtual reality
(VR) devices and many other consumer electronics devices.
Additionally, Himax designs and provides controllers for touch
sensor displays, in-cell Touch and Display Driver Integration
(TDDI) single-chip solutions, LED driver ICs, power management ICs,
scaler products for monitors and projectors, tailor-made video
processing IC solutions, silicon IPs and LCOS micro-displays for
augmented reality (AR) devices and head-up displays (HUD) for
automotive. The Company also offers digital camera solutions,
including CMOS image sensors and wafer level optics for AR devices,
3D depth scanning and machine vision, which are used in a wide
variety of applications such as mobile phone, tablet, laptop, TV,
PC camera, automobile, security, medical devices and Internet of
Things. Founded in 2001 and headquartered in Tainan, Taiwan, Himax
currently employs over 2,100 people from three Taiwan-based offices
in Tainan, Hsinchu and Taipei and country offices in China, Korea,
Japan and the US. Himax has 3,000 patents granted and 404 patents
pending approval worldwide as of June 30th, 2017. 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, 2016 filed with the SEC, as may be amended.
Company Contacts:
Jackie Chang, CFOHimax
Technologies, Inc.Tel: +886-2-2370-3999 Ext.22300 OrUS Tel:
+1-949-585-9838 Ext.252Fax: +886-2-2314-0877Email:
jackie_chang@himax.com.twwww.himax.com.tw
Ophelia Lin, Investor RelationsHimax
Technologies, Inc.Tel: +886-2-2370-3999 Ext.22202Fax:
+886-2-2314-0877 Email:
ophelia_lin@himax.com.tw www.himax.com.tw
Ken Liu, Investor RelationsHimax Technologies,
Inc.Tel: +886-2-2370-3999 Ext.22513Fax: +886-2-2314-0877 Email:
ken_liu@himax.com.twwww.himax.com.tw
Investor Relations - US RepresentativeGreg
Falesnik, Managing DirectorMZ North AmericaTel:
+1-212-301-7130Email: greg.falesnik@mzgroup.us www.mzgroup.us
|
-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 Share and Per Share
Data) |
|
|
|
Three Months
Ended June 30, |
|
|
Three Months
Ended March 31, |
|
|
|
2017 |
|
|
|
|
2016 |
|
|
|
|
2017 |
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
151,730 |
|
|
|
$ |
201,074 |
|
|
|
$ |
155,210 |
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
Cost of revenues |
|
|
115,556 |
|
|
|
|
148,596 |
|
|
|
|
119,309 |
|
Research and development |
|
|
27,921 |
|
|
|
|
21,803 |
|
|
|
|
25,331 |
|
General and administrative |
|
|
4,552 |
|
|
|
|
4,814 |
|
|
|
|
4,633 |
|
Sales and marketing |
|
|
4,641 |
|
|
|
|
3,962 |
|
|
|
|
4,364 |
|
Total costs and expenses |
|
|
152,670 |
|
|
|
|
179,175 |
|
|
|
|
153,637 |
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
|
(940 |
) |
|
|
|
21,899 |
|
|
|
|
1,573 |
|
|
|
|
|
|
|
|
|
|
Non operating income
(loss): |
|
|
|
|
|
|
|
|
Interest income |
|
|
619 |
|
|
|
|
329 |
|
|
|
|
543 |
|
Dividend income |
|
|
- |
|
|
|
|
700 |
|
|
|
|
- |
|
Gains (losses) on sale of securities, net |
|
|
37 |
|
|
|
|
(49 |
) |
|
|
|
70 |
|
Equity in losses of equity method investees |
|
|
(697 |
) |
|
|
|
(198 |
) |
|
|
|
(134 |
) |
Foreign currency exchange gains (losses), net |
|
|
(27 |
) |
|
|
|
182 |
|
|
|
|
(1,033 |
) |
Interest expense |
|
|
(113 |
) |
|
|
|
(190 |
) |
|
|
|
(137 |
) |
Other income (losses), net |
|
|
(41 |
) |
|
|
|
1 |
|
|
|
|
48 |
|
|
|
|
(222 |
) |
|
|
|
775 |
|
|
|
|
(643 |
) |
Earnings (loss) before
income taxes |
|
|
(1,162 |
) |
|
|
|
22,674 |
|
|
|
|
930 |
|
Income tax expense (benefit) |
|
|
(179 |
) |
|
|
|
3,401 |
|
|
|
|
121 |
|
Net income (loss) |
|
|
(983 |
) |
|
|
|
19,273 |
|
|
|
|
809 |
|
Net loss
attributable to noncontrolling interests |
|
|
354 |
|
|
|
|
514 |
|
|
|
|
554 |
|
Net
income (loss) attributable to
Himax Technologies, Inc. stockholders |
|
$ |
(629 |
) |
|
|
$ |
19,787 |
|
|
|
$ |
1,363 |
|
|
|
|
|
|
|
|
|
|
Basic
earnings (loss) per ADS
attributable to Himax Technologies, Inc. stockholders |
|
$ |
(0.004 |
) |
|
|
$ |
0.115 |
|
|
|
$ |
0.008 |
|
Diluted
earnings (loss) per ADS
attributable to Himax Technologies, Inc. stockholders |
|
$ |
(0.004 |
) |
|
|
$ |
0.115 |
|
|
|
$ |
0.008 |
|
|
|
|
|
|
|
|
|
|
Basic Weighted Average Outstanding ADS |
|
|
172,399 |
|
|
|
|
172,303 |
|
|
|
|
172,399 |
|
Diluted Weighted Average Outstanding ADS |
|
|
172,462 |
|
|
|
|
172,385 |
|
|
|
|
172,424 |
|
|
Himax Technologies, Inc. |
Unaudited Condensed Consolidated Statements of
Income |
(Amounts in Thousands of U.S. Dollars,
Except Share and Per Share
Data) |
|
|
|
Six Months Ended
June
30, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
Revenues |
|
|
$ |
306,940 |
|
|
|
$ |
381,393 |
|
|
|
|
|
|
|
|
Costs and
expenses: |
|
|
|
|
|
|
Cost of
revenues |
|
|
|
234,865 |
|
|
|
|
281,740 |
|
Research
and development |
|
|
|
53,252 |
|
|
|
|
45,205 |
|
General
and administrative |
|
|
|
9,185 |
|
|
|
|
9,395 |
|
Sales and
marketing |
|
|
|
9,005 |
|
|
|
|
7,975 |
|
Total costs and expenses |
|
|
|
306,307 |
|
|
|
|
344,315 |
|
|
|
|
|
|
|
|
Operating
income |
|
|
|
633 |
|
|
|
|
37,078 |
|
|
|
|
|
|
|
|
Non
operating income
(loss): |
|
|
|
|
|
|
Interest
income |
|
|
|
1,162 |
|
|
|
|
558 |
|
Dividend
income |
|
|
|
- |
|
|
|
|
700 |
|
Gains
(losses) on sale of securities, net |
|
|
|
107 |
|
|
|
|
(90 |
) |
Equity in
losses of equity method investees |
|
|
|
(831 |
) |
|
|
|
(359 |
) |
Foreign
currency exchange losses, net |
|
|
|
(1,060 |
) |
|
|
|
(33 |
) |
Interest
expense |
|
|
|
(250 |
) |
|
|
|
(369 |
) |
Other
income (losses), net |
|
|
|
7 |
|
|
|
|
(9 |
) |
|
|
|
|
(865 |
) |
|
|
|
398 |
|
Earnings (loss) before
income taxes |
|
|
|
(232 |
) |
|
|
|
37,476 |
|
Income
tax expense (benefit) |
|
|
|
(58 |
) |
|
|
|
5,621 |
|
Net
income (loss) |
|
|
|
(174 |
) |
|
|
|
31,855 |
|
Net loss
attributable to noncontrolling interests |
|
|
|
908 |
|
|
|
|
1,020 |
|
Net
income attributable to Himax
Technologies, Inc.
stockholders |
|
|
$ |
734 |
|
|
|
$ |
32,875 |
|
|
|
|
|
|
|
|
Basic earnings
per ADS attributable to Himax Technologies,
Inc. stockholders |
|
|
$ |
0.004 |
|
|
|
$ |
0.191 |
|
Diluted
earnings per ADS attributable to Himax
Technologies, Inc.
stockholders |
|
|
$ |
0.004 |
|
|
|
$ |
0.191 |
|
|
|
|
|
|
|
|
Basic Weighted Average Outstanding ADS |
|
|
|
172,399 |
|
|
|
|
172,303 |
|
Diluted Weighted Average Outstanding
ADS |
|
|
|
172,444 |
|
|
|
|
172,370 |
|
|
|
|
|
|
|
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 Ended June
30, |
|
|
ThreeMonthsEndedMarch
31, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
Share-based
compensation |
|
|
|
|
|
|
|
|
Cost of
revenues |
|
$ |
25 |
|
|
|
$ |
27 |
|
|
|
$ |
25 |
|
Research
and development |
|
|
137 |
|
|
|
|
160 |
|
|
|
|
137 |
|
General
and administrative |
|
|
69 |
|
|
|
|
70 |
|
|
|
|
69 |
|
Sales and
marketing |
|
|
24 |
|
|
|
|
20 |
|
|
|
|
23 |
|
Income
tax benefit |
|
|
(43 |
) |
|
|
|
(47 |
) |
|
|
|
(42 |
) |
Total |
|
$ |
212 |
|
|
|
$ |
230 |
|
|
|
$ |
212 |
|
|
|
|
|
|
|
|
|
|
The amount
of acquisition-related charges
included in applicable statements of
income categories is summarized as
follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
charges |
|
|
|
|
|
|
|
|
Research
and development |
|
$ |
246 |
|
|
|
$ |
246 |
|
|
|
$ |
246 |
|
Income
tax benefit |
|
|
(98 |
) |
|
|
|
(98 |
) |
|
|
|
(99 |
) |
Total |
|
$ |
148 |
|
|
|
$ |
148 |
|
|
|
$ |
147 |
|
|
|
|
|
|
|
|
|
|
|
|
|
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: |
|
Six Months Ended
June 30, |
|
|
2017 |
|
|
2016 |
Share-based
compensation |
|
|
|
|
|
Cost of
revenues |
|
$ |
50 |
|
|
|
$ |
53 |
|
Research
and development |
|
|
274 |
|
|
|
|
321 |
|
General
and administrative |
|
|
138 |
|
|
|
|
140 |
|
Sales and
marketing |
|
|
47 |
|
|
|
|
40 |
|
Income
tax benefit |
|
|
(85 |
) |
|
|
|
(95 |
) |
Total |
|
$ |
424 |
|
|
|
$ |
459 |
|
|
|
|
|
|
|
The amount
of acquisition-related charges
included in applicable statements of
income categories is summarized as
follows: |
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
charges |
|
|
|
|
|
Research
and development |
|
$ |
492 |
|
|
|
$ |
492 |
|
Income
tax benefit |
|
|
(197 |
) |
|
|
|
(197 |
) |
Total |
|
$ |
295 |
|
|
|
$ |
295 |
|
|
|
|
|
|
|
|
Himax Technologies, Inc. |
GAAP Unaudited Condensed
Consolidated Balance Sheets |
(Amounts in Thousands of U.S. Dollars,
Except Share and Per Share
Data) |
|
|
|
June
30,
2017 |
|
March
31,
2017 |
|
June 30,
2016 |
Assets |
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
177,206 |
|
|
$ |
190,345 |
|
|
$ |
164,423 |
|
Investments in marketable securities available-for-sale |
|
|
8,663 |
|
|
|
9,111 |
|
|
|
14,917 |
|
Accounts
receivable, less allowance for doubtful accounts, sales returns and
discounts |
|
|
163,243 |
|
|
|
167,681 |
|
|
|
187,925 |
|
Inventories |
|
|
147,680 |
|
|
|
148,260 |
|
|
|
186,655 |
|
Deferred
income taxes |
|
|
- |
|
|
|
- |
|
|
|
3,361 |
|
Restricted cash, cash equivalents and marketable securities |
|
|
107,201 |
|
|
|
107,414 |
|
|
|
138,000 |
|
Other
receivables from related party |
|
|
4,150 |
|
|
|
5,650 |
|
|
|
1,000 |
|
Prepaid
expenses and other current assets |
|
|
12,329 |
|
|
|
14,794 |
|
|
|
19,356 |
|
Total current assets |
|
|
620,472 |
|
|
|
643,255 |
|
|
|
715,637 |
|
Investment in non-marketable
equity securities |
|
|
12,242 |
|
|
|
12,242 |
|
|
|
10,780 |
|
Equity method
investments |
|
|
4,055 |
|
|
|
2,235 |
|
|
|
3,277 |
|
Property, plant and
equipment, net |
|
|
57,813 |
|
|
|
47,738 |
|
|
|
51,056 |
|
Deferred income
taxes |
|
|
6,671 |
|
|
|
6,597 |
|
|
|
1,074 |
|
Goodwill |
|
|
28,138 |
|
|
|
28,138 |
|
|
|
28,138 |
|
Other
intangible assets, net |
|
|
2,675 |
|
|
|
2,922 |
|
|
|
3,665 |
|
Restricted
marketable securities |
|
|
460 |
|
|
|
132 |
|
|
|
124 |
|
Other
assets |
|
|
1,478 |
|
|
|
1,778 |
|
|
|
1,517 |
|
|
|
|
113,532 |
|
|
|
101,782 |
|
|
|
99,631 |
|
Total assets |
|
$ |
734,004 |
|
|
$ |
745,037 |
|
|
$ |
815,268 |
|
Liabilities, redeemable
noncontrolling interest and
Equity |
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
Short-term debt |
|
$ |
107,000 |
|
|
$ |
107,000 |
|
|
$ |
138,000 |
|
Accounts
payable |
|
|
113,670 |
|
|
|
115,941 |
|
|
|
151,842 |
|
Accounts
payable to related party |
|
|
- |
|
|
|
1,098 |
|
|
|
- |
|
Income
taxes payable |
|
|
7,778 |
|
|
|
15,632 |
|
|
|
11,695 |
|
Deferred
income taxes |
|
|
- |
|
|
|
- |
|
|
|
140 |
|
Other
accrued expenses and other current liabilities |
|
|
71,062 |
|
|
|
28,524 |
|
|
|
54,729 |
|
Total current liabilities |
|
|
299,510 |
|
|
|
268,195 |
|
|
|
356,406 |
|
Other
liabilities |
|
|
3,191 |
|
|
|
3,680 |
|
|
|
3,783 |
|
Total liabilities |
|
|
302,701 |
|
|
|
271,875 |
|
|
|
360,189 |
|
|
|
|
|
|
|
|
Redeemable
noncontrolling interest |
|
|
3,656 |
|
|
|
3,656 |
|
|
|
3,656 |
|
Equity |
|
|
|
|
|
|
Himax
Technologies, Inc.
stockholders’ equity: |
|
|
|
|
|
|
Ordinary
shares, US$0.3 par value, 1,000,000,000 shares authorized;
356,699,482 shares issued; and 344,007,418 shares, 344,007,418
shares and 343,815,424 shares outstanding at June 30, 2017, March
31, 2017 and June 30, 2016, respectively |
|
|
107,010 |
|
|
|
107,010 |
|
|
|
107,010 |
|
Additional paid-in capital |
|
|
106,837 |
|
|
|
106,591 |
|
|
|
105,881 |
|
Treasury
shares, at cost, 12,692,064 shares, 12,692,064 shares and
12,884,058 shares at June 30, 2017, March 31, 2017 and June 30,
2016, respectively |
|
|
(9,020 |
) |
|
|
(9,020 |
) |
|
|
(9,157 |
) |
Accumulated other comprehensive loss |
|
|
(2,041 |
) |
|
|
(2,207 |
) |
|
|
(1,897 |
) |
Unappropriated retained earnings |
|
|
225,312 |
|
|
|
267,228 |
|
|
|
247,902 |
|
Himax Technologies, Inc. stockholders’
equity |
|
|
428,098 |
|
|
|
469,602 |
|
|
|
449,739 |
|
Noncontrolling
interests |
|
|
(451 |
) |
|
|
(96 |
) |
|
|
1,684 |
|
Total equity |
|
|
427,647 |
|
|
|
469,506 |
|
|
|
451,423 |
|
Total liabilities,
redeemable noncontrolling
interest and equity |
|
$ |
734,004 |
|
|
$ |
745,037 |
|
|
$ |
815,268 |
|
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts
in Thousands of
U.S.
Dollars) |
|
|
Three Months Ended June
30, |
|
|
ThreeMonths
EndedMarch
31, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities: |
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(983 |
) |
|
|
$ |
19,273 |
|
|
|
$ |
809 |
|
Adjustments to
reconcile net income (loss) to net cash provided by (used in)
operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
3,471 |
|
|
|
|
3,465 |
|
|
|
|
3,439 |
|
Share-based compensation expenses |
|
|
255 |
|
|
|
|
277 |
|
|
|
|
254 |
|
Gain on
disposals of property and equipment |
|
|
--- |
|
|
|
|
--- |
|
|
|
|
(28 |
) |
Loss
(gain) on disposals of marketable securities, net |
|
|
(37 |
) |
|
|
|
49 |
|
|
|
|
(70 |
) |
Equity in
losses of equity method investees |
|
|
697 |
|
|
|
|
198 |
|
|
|
|
134 |
|
Deferred
income tax benefit |
|
|
(50 |
) |
|
|
|
(86 |
) |
|
|
|
(490 |
) |
Inventories write downs |
|
|
2,487 |
|
|
|
|
3,186 |
|
|
|
|
3,047 |
|
Changes in: |
|
|
|
|
|
|
|
|
Accounts
receivable |
|
|
4,482 |
|
|
|
|
(14,975 |
) |
|
|
|
23,349 |
|
Inventories |
|
|
(1,907 |
) |
|
|
|
(7,027 |
) |
|
|
|
(1,559 |
) |
Prepaid
expenses and other current assets |
|
|
1,898 |
|
|
|
|
296 |
|
|
|
|
(1,380 |
) |
Accounts
payable |
|
|
(2,271 |
) |
|
|
|
13,180 |
|
|
|
|
(26,328 |
) |
Accounts
payable to related party |
|
|
(1,098 |
) |
|
|
|
--- |
|
|
|
|
522 |
|
Income
taxes payable |
|
|
(7,854 |
) |
|
|
|
(3,082 |
) |
|
|
|
1,482 |
|
Other
accrued expenses and other current liabilities |
|
|
182 |
|
|
|
|
(1,669 |
) |
|
|
|
1,836 |
|
Other
liabilities |
|
|
(507 |
) |
|
|
|
7 |
|
|
|
|
443 |
|
Net cash provided by
(used in) operating
activities |
|
|
(1,235 |
) |
|
|
|
13,092 |
|
|
|
|
5,460 |
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
|
|
|
Purchases
of property, plant and equipment |
|
|
(11,919 |
) |
|
|
|
(1,680 |
) |
|
|
|
(2,009 |
) |
Proceeds
from disposals of property and equipment |
|
|
--- |
|
|
|
|
--- |
|
|
|
|
28 |
|
Purchases
of available-for-sale marketable securities |
|
|
(15,979 |
) |
|
|
|
(10,552 |
) |
|
|
|
(5,101 |
) |
Proceeds
from disposals of available-for-sale marketable securities |
|
|
16,497 |
|
|
|
|
12,831 |
|
|
|
|
6,520 |
|
Proceeds
from capital reduction of investment |
|
|
--- |
|
|
|
|
431 |
|
|
|
|
--- |
|
Purchase
of equity method investment |
|
|
(2,230 |
) |
|
|
|
--- |
|
|
|
|
--- |
|
Proceeds
from (repayments of) refundable deposits, net |
|
|
284 |
|
|
|
|
394 |
|
|
|
|
(310 |
) |
Releases
(pledges) of restricted marketable securities |
|
|
(115 |
) |
|
|
|
451 |
|
|
|
|
(222 |
) |
Cash paid
for loan made to related party |
|
|
--- |
|
|
|
|
(1,000 |
) |
|
|
|
--- |
|
Cash
received for loan made to related party |
|
|
1,500 |
|
|
|
|
--- |
|
|
|
|
1,500 |
|
Net cash provided by (used in)
investing activities |
|
|
(11,962 |
) |
|
|
|
875 |
|
|
|
|
406 |
|
|
|
|
|
|
|
|
|
|
|
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts
in Thousands of
U.S.
Dollars) |
|
|
Three Months Ended June
30, |
|
|
ThreeMonths EndedMarch
31, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
Cash flows from
financing activities: |
|
|
|
|
|
|
|
|
Proceeds
from disposals of subsidiary shares to noncontrolling interests by
Himax Imaging, Inc. |
|
$ |
--- |
|
|
|
$ |
1 |
|
|
|
$ |
4 |
|
Purchases
of subsidiary shares from noncontrolling interests |
|
|
(1 |
) |
|
|
|
--- |
|
|
|
|
--- |
|
Releases
of restricted cash, cash equivalents and marketable securities (for
borrowing of short-term debt) |
|
|
--- |
|
|
|
|
42,000 |
|
|
|
|
31,000 |
|
Proceeds
from short-term debt |
|
|
27,000 |
|
|
|
|
49,000 |
|
|
|
|
27,161 |
|
Repayments of short-term debt |
|
|
(27,000 |
) |
|
|
|
(91,000 |
) |
|
|
|
(58,161 |
) |
Net cash provided by
(used in)
financing activities |
|
|
(1 |
) |
|
|
|
1 |
|
|
|
|
4 |
|
Effect
of foreign currency exchange rate
changes on cash and cash equivalents |
|
|
59 |
|
|
|
|
(66 |
) |
|
|
|
23 |
|
Net
increase (decrease) in cash and cash
equivalents |
|
|
(13,139 |
) |
|
|
|
13,902 |
|
|
|
|
5,893 |
|
Cash and cash
equivalents at beginning of period |
|
|
190,345 |
|
|
|
|
150,521 |
|
|
|
|
184,452 |
|
Cash and cash
equivalents at end of period |
|
$ |
177,206 |
|
|
|
$ |
164,423 |
|
|
|
$ |
190,345 |
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of cash flow information: |
|
|
|
|
|
|
|
|
Cash paid
during the period for: |
|
|
|
|
|
|
|
|
Interest |
|
$ |
113 |
|
|
|
$ |
182 |
|
|
|
$ |
137 |
|
Income
taxes |
|
$ |
7,986 |
|
|
|
$ |
6,591 |
|
|
|
$ |
53 |
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of investing activities affecting both
cash and non-cash items: |
|
|
|
|
|
|
|
|
Purchases
of property, plant and equipment |
|
$ |
13,292 |
|
|
|
$ |
1,638 |
|
|
|
$ |
2,733 |
|
Decrease
(increase) in payable for purchases of equipment and asset
retirement obligations |
|
|
(1,373 |
) |
|
|
|
42 |
|
|
|
|
(724 |
) |
Cash
paid |
|
$ |
11,919 |
|
|
|
$ |
1,680 |
|
|
|
$ |
2,009 |
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of non-cash investing and
financing activities: |
|
|
|
|
|
|
|
|
Dividend payable |
|
$ |
41,281 |
|
|
|
$ |
22,348 |
|
|
|
$ |
--- |
|
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts
in Thousands of
U.S.
Dollars) |
|
|
|
|
Six Months Ended
June
30, |
|
|
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities: |
|
|
|
|
|
|
|
Net income (loss) |
|
|
|
$ |
(174 |
) |
|
|
$ |
31,855 |
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
|
|
6,910 |
|
|
|
|
6,915 |
|
Share-based compensation expenses |
|
|
|
|
509 |
|
|
|
|
554 |
|
Gain on
disposals of property and equipment |
|
|
|
|
(28 |
) |
|
|
|
--- |
|
Loss
(gain) on disposals of marketable securities, net |
|
|
|
|
(107 |
) |
|
|
|
90 |
|
Equity in
losses of equity method investees |
|
|
|
|
831 |
|
|
|
|
359 |
|
Deferred
income tax benefit |
|
|
|
|
(540 |
) |
|
|
|
(265 |
) |
Inventories write downs |
|
|
|
|
5,534 |
|
|
|
|
5,896 |
|
Changes in: |
|
|
|
|
|
|
|
Accounts
receivable |
|
|
|
|
27,831 |
|
|
|
|
(10,776 |
) |
Inventories |
|
|
|
|
(3,466 |
) |
|
|
|
(21,177 |
) |
Prepaid
expenses and other current assets |
|
|
|
|
518 |
|
|
|
|
(332 |
) |
Accounts
payable |
|
|
|
|
(28,599 |
) |
|
|
|
27,420 |
|
Accounts
payable to related party |
|
|
|
|
(576 |
) |
|
|
|
--- |
|
Income
taxes payable |
|
|
|
|
(6,372 |
) |
|
|
|
(431 |
) |
Other
accrued expenses and other current liabilities |
|
|
|
|
2,018 |
|
|
|
|
(5,508 |
) |
Other
liabilities |
|
|
|
|
(64 |
) |
|
|
|
(3 |
) |
Net cash provided by
operating activities |
|
|
|
|
4,225 |
|
|
|
|
34,597 |
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
|
|
Purchases
of property, plant and equipment |
|
|
|
|
(13,928 |
) |
|
|
|
(3,882 |
) |
Proceeds
from disposals of property and equipment |
|
|
|
|
28 |
|
|
|
|
--- |
|
Purchases
of available-for-sale marketable securities |
|
|
|
|
(21,080 |
) |
|
|
|
(17,148 |
) |
Proceeds
from disposals of available-for-sale marketable securities |
|
|
|
|
23,017 |
|
|
|
|
20,799 |
|
Proceeds from capital reduction of investment |
|
|
|
--- |
|
|
|
|
431 |
|
Purchase
of equity method investment |
|
|
|
|
(2,230 |
) |
|
|
|
--- |
|
Proceeds from (repayments of) refundable deposits, net |
|
|
|
(26 |
) |
|
|
|
400 |
|
Releases (pledges) of restricted marketable securities |
|
|
|
(337 |
) |
|
|
|
439 |
|
Cash paid for loan made to related party |
|
|
|
--- |
|
|
|
|
(1,000 |
) |
Cash
received for loan made to related party |
|
|
|
|
3,000 |
|
|
|
|
--- |
|
Net cash provided by
(used in) investing
activities |
|
|
|
|
(11,556 |
) |
|
|
|
39 |
|
|
|
|
|
|
|
|
|
|
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts
in Thousands of
U.S.
Dollars) |
|
|
|
|
Six Months Ended
June
30, |
|
|
|
|
2017 |
|
|
2016 |
Cash flows from
financing activities: |
|
|
|
|
|
|
|
Proceeds
from disposals of subsidiary shares to noncontrolling interests by
Himax Imaging, Inc. |
|
|
|
$ |
4 |
|
|
|
$ |
1 |
|
Purchases
of subsidiary shares from noncontrolling interests |
|
|
|
|
(1 |
) |
|
|
|
(1 |
) |
Releases
of restricted cash, cash equivalents and marketable securities (for
borrowing of short-term debt) |
|
|
|
|
31,000 |
|
|
|
|
42,000 |
|
Proceeds
from short-term debt |
|
|
|
|
54,161 |
|
|
|
|
110,000 |
|
Repayments of short-term debt |
|
|
|
|
(85,161 |
) |
|
|
|
(152,000 |
) |
Net cash provided by
financing activities |
|
|
|
|
3 |
|
|
|
|
--- |
|
Effect
of foreign currency exchange rate
changes on cash and cash equivalents |
|
|
|
|
82 |
|
|
|
|
(42 |
) |
Net
increase (decrease) in
cash and cash equivalents |
|
|
|
|
(7,246 |
) |
|
|
|
34,594 |
|
Cash and cash
equivalents at beginning of period |
|
|
|
|
184,452 |
|
|
|
|
129,829 |
|
Cash and cash
equivalents at end of period |
|
|
|
$ |
177,206 |
|
|
|
$ |
164,423 |
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of cash flow information: |
|
|
|
|
|
|
|
Cash paid
during the period for: |
|
|
|
|
|
|
|
Interest
expense |
|
|
|
$ |
250 |
|
|
|
$ |
369 |
|
Income
taxes |
|
|
|
$ |
8,039 |
|
|
|
$ |
6,662 |
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of investing activities affecting both
cash and non-cash items: |
|
|
|
|
|
|
|
Purchases
of property, plant and equipment |
|
|
|
$ |
16,025 |
|
|
|
$ |
3,026 |
|
Decrease
(increase) in payable for purchases of equipment and asset
retirement obligations |
|
|
|
|
(2,097 |
) |
|
|
|
856 |
|
Cash
paid |
|
|
|
$ |
13,928 |
|
|
|
$ |
3,882 |
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of non-cash investing and
financing activities: |
|
|
|
|
|
|
|
Dividend
payable |
|
|
|
$ |
41,281 |
|
|
|
$ |
22,348 |
|
|
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 Ended June
30, |
|
|
ThreeMonthsEndedMarch
31, |
|
|
2017 |
|
|
|
|
2016 |
|
|
|
|
2017 |
|
Revenues |
$ |
151,730 |
|
|
|
$ |
201,074 |
|
|
|
$ |
155,210 |
|
Gross profit |
|
36,174 |
|
|
|
|
52,478 |
|
|
|
|
35,901 |
|
Add: Share-based
compensation – cost of revenues |
|
25 |
|
|
|
|
27 |
|
|
|
|
25 |
|
Gross profit excluding
share-based compensation |
|
36,199 |
|
|
|
|
52,505 |
|
|
|
|
35,926 |
|
Gross margin excluding
share-based compensation |
|
23.9 |
% |
|
|
|
26.1 |
% |
|
|
|
23.1 |
% |
Operating income
(loss) |
|
(940 |
) |
|
|
|
21,899 |
|
|
|
|
1,573 |
|
Add: Share-based
compensation |
|
255 |
|
|
|
|
277 |
|
|
|
|
254 |
|
Operating income (loss)
excluding share-based compensation |
|
(685 |
) |
|
|
|
22,176 |
|
|
|
|
1,827 |
|
Add:
Acquisition-related charges –intangible assets amortization |
|
246 |
|
|
|
|
246 |
|
|
|
|
246 |
|
Operating income (loss)
excluding share-based compensation and acquisition-related
charges |
|
(439 |
) |
|
|
|
22,422 |
|
|
|
|
2,073 |
|
Operating margin
excluding share-based compensation and acquisition-related
charges |
|
(0.3 |
%) |
|
|
|
11.1 |
% |
|
|
|
1.3 |
% |
Net income (loss)
attributable to Himax Technologies, Inc. stockholders |
|
(629 |
) |
|
|
|
19,787 |
|
|
|
|
1,363 |
|
Add: Share-based
compensation, net of tax |
|
212 |
|
|
|
|
230 |
|
|
|
|
212 |
|
Add:
Acquisition-related charges, net of tax |
|
148 |
|
|
|
|
148 |
|
|
|
|
147 |
|
Net income (loss)
attributable to Himax Technologies, Inc. stockholders excluding
share-based compensation and acquisition-related charges |
|
(269 |
) |
|
|
|
20,165 |
|
|
|
|
1,722 |
|
Net margin attributable
to Himax Technologies, Inc. stockholders excluding share-based
compensation and acquisition-related charges |
|
(0.2 |
%) |
|
|
|
10.0 |
% |
|
|
|
1.1 |
% |
|
|
|
|
|
|
|
|
*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 Technologies, Inc. stockholders
excluding share-based compensation and acquisition-related charges
equals net income attributable to Himax Technologies, Inc.
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: |
|
|
|
|
|
|
Six Months Ended
June 30, |
|
|
|
|
2017 |
|
|
|
2016 |
|
Revenues |
|
|
$ |
306,940 |
|
|
$ |
381,393 |
|
Gross profit |
|
|
|
72,075 |
|
|
|
99,653 |
|
Add: Share-based
compensation – Cost of revenues |
|
|
|
50 |
|
|
|
53 |
|
Gross profit excluding
share-based compensation |
|
|
|
72,125 |
|
|
|
99,706 |
|
Gross margin excluding
share-based compensation |
|
|
|
23.5 |
% |
|
|
26.1 |
% |
Operating income |
|
|
|
633 |
|
|
|
37,078 |
|
Add: Share-based
compensation |
|
|
|
509 |
|
|
|
554 |
|
Operating income
excluding share-based compensation |
|
|
|
1,142 |
|
|
|
37,632 |
|
Add:
Acquisition-related charges –Intangible assets amortization |
|
|
|
492 |
|
|
|
492 |
|
Operating income
excluding share-based compensation and acquisition-related
charges |
|
|
|
1,634 |
|
|
|
38,124 |
|
Operating margin
excluding share-based compensation and acquisition-related
charges |
|
|
|
0.5 |
% |
|
|
10.0 |
% |
Net income attributable
to Himax Technologies, Inc. stockholders |
|
|
|
734 |
|
|
|
32,875 |
|
Add: Share-based
compensation, net of tax |
|
|
|
424 |
|
|
|
459 |
|
Add:
Acquisition-related charges, net of tax |
|
|
|
295 |
|
|
|
295 |
|
Net income attributable
to Himax Technologies, Inc. stockholders excluding share-based
compensation and acquisition-related charges |
|
|
|
1,453 |
|
|
|
33,629 |
|
Net margin attributable
to Himax Technologies, Inc. stockholders excluding share-based
compensation and acquisition-related charges |
|
|
|
0.5 |
% |
|
|
8.8 |
% |
|
|
|
|
|
|
*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 Technologies, Inc. stockholders
excluding share-based compensation and acquisition-related charges
equals net income attributable to Himax Technologies, Inc.
stockholders excluding share-based compensation and
acquisition-related charges divided by revenues |
|
Diluted Earnings (loss) Per ADS Attributable to Himax
Technologies, Inc. stockholders Excluding Share-based Compensation
and Acquisition-Related Charges: (Amounts in U.S.
Dollars) |
|
|
|
|
|
Three Months Ended June
30, |
|
|
Six Months Ended
June 30, |
|
|
|
|
|
|
2017 |
|
|
|
2017 |
|
|
|
Diluted GAAP earnings
(loss) per ADS attributable to Himax Technologies, Inc.
stockholders |
|
($0.004) |
|
|
$0.004 |
|
|
|
Add: Share-based
compensation per ADS |
|
$0.001 |
|
|
$0.002 |
|
|
|
Add:
Acquisition-related charges per ADS |
|
$0.001 |
|
|
$0.002 |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted non-GAAP
earnings (loss) per ADS attributable to Himax Technologies, Inc.
stockholders excluding share-based compensation and
acquisition-related charges |
|
($0.002) |
|
|
$0.008 |
|
|
|
|
|
|
|
|
|
Numbers do not add up due to rounding |
|
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