KFAR SAVA, Israel, July 26, 2018 /PRNewswire/ --Silicom Ltd.
(NASDAQ: SILC), a leading provider of high-performance
networking and data infrastructure solutions, today reported its
financial results for the second quarter and first half ended
June 30, 2018.
Financial Results
Second Quarter: Silicom's revenues for the second
quarter of 2018 totalled $27.6
million compared with $30.3
million for the second quarter of 2017.
On a GAAP basis, net income for the quarter totalled
$2.4 million, or $0.32 per share (basic and diluted), compared
with $4.2 million, or $0.55 per diluted share ($0.57 per basic share), for the second quarter of
2017.
On a non-GAAP basis (as described and reconciled below), net
income for the quarter totalled $3.4
million, or $0.44 per diluted
share ($0.45 per basic share),
compared with $5.2 million, or
$0.69 per diluted share ($0.71 per basic share), for the second quarter of
2017.
First Six Months: Silicom's revenues for the first
half of 2018 totalled $57.1 million
compared with $55.6 million for the
first half of 2017.
On a GAAP basis, net income for the period totalled $1.0 million, or $0.13 per share (basic and diluted), compared
with $6.8 million, or $0.90 per diluted share ($0.92 per diluted share), for the first half of
2017.
On a non-GAAP basis (as described and reconciled below), net
income for the period totalled $7.7
million, or $1.00 per diluted
share ($1.02 per basic share),
compared with $9.1 million, or
$1.21 per diluted share ($1.23 per basic share), for the first half of
2017.
Guidance for the Third Quarter
Management projects that revenues for the third quarter of 2018
will total $30 to $31 million.
Comments of Management
Shaike Orbach, Silicom's
President and CEO, commented, "We are pleased to report revenues
which are in line with our plans, confirming the fundamental
strength of our business and the soundness of our strategic
plan.
"During the quarter, we were excited to close two strategic deals
that demonstrated the unique fit of our products for the
connectivity needs of SD-WAN and NFV related markets, both at the
CPE level and in the hubs. In April, a Tier-1 telco selected our
edge devices for its SD-WAN-based deployment, and at the end of the
quarter, a Tier-1 Internet and content provider chose our
Switch-on-a-NIC for its SD-WAN-ready distribution hub
infrastructure. These clients chose our products as critical
building blocks that maximize the performance of their SD-WAN and
NFV-related infrastructures, demonstrating that our concepts are
powerful at the data center, hub and CPEs levels. With products
that are important at every segment of the communications network,
every service provider represents the opportunity for an almost
unlimited series of Design Wins."
Mr. Orbach continued, "Indeed, we are leveraging these successes
by reaching out to additional service providers, and also returning
to existing CPE customers to discuss their need for Data Center as
well as SD-WAN hub solutions - and vice versa. We are pleased with
the reaction so far and believe that it will translate into
long-term growth for our Company."
Conference Call Details
Silicom's Management will host an interactive conference today,
July 26th, at 9am Eastern Time (6am
Pacific Time, 4pm Israel Time)
to review and discuss the results.
To participate, please call one of the following
teleconferencing numbers. Please begin placing your calls at least
10 minutes before the conference call commences. If you are unable
to connect using the toll-free numbers, try the international
dial-in number.
US: +1-888-407-2553
UK: 0-800-917-5108
ISRAEL: 03-918-0609
INTERNATIONAL: +972-3-918-0609
At: 9:00am Eastern Time,
6:00am Pacific Time, 4:00pm Israel Time
For those unable to listen to the live call, a replay of the
call will be available for three months from the day after the call
under the investor relations section of Silicom's website.
Non-GAAP Financial Measures
This release, including the financial tables below, presents
other financial information that may be considered "non-GAAP
financial measures" under Regulation G and related reporting
requirements promulgated by the Securities and Exchange Commission
as they apply to our company. These non-GAAP financial measures
exclude compensation expenses in respect of options and RSUs
granted to directors, officers and employees, amortization of
acquired intangible assets, changes in the fair value of contingent
consideration from a business combination, taxes on amortization of
acquired intangible assets, as well as discontinued project-related
write-offs. Non-GAAP financial measures should be evaluated in
conjunction with, and are not a substitute for, GAAP financial
measures. The tables also present the GAAP financial measures,
which are most comparable to the non-GAAP financial measures as
well as reconciliation between the non-GAAP financial measures and
the most comparable GAAP financial measures. The non-GAAP financial
information presented herein should not be considered in isolation
from or as a substitute for operating income, net income or per
share data prepared in accordance with GAAP.
About Silicom
Silicom Ltd. is an industry-leading provider of high-performance
networking and data infrastructure solutions. Designed primarily to
improve performance and efficiency in Cloud and Data Center
environments, Silicom's solutions increase throughput, decrease
latency and boost the performance of servers and networking
appliances, the infrastructure backbone that enables advanced Cloud
architectures and leading technologies like NFV, SD-WAN and Cyber
Security. Our innovative solutions for high-density networking,
high-speed fabric switching, offloading and acceleration, which
utilize a range of cutting-edge silicon technologies as well as
FPGA-based solutions, are ideal for scaling-up and scaling-out
cloud infrastructures.
Silicom products are used by major Cloud players, service
providers, telcos and OEMs as components of their infrastructure
offerings, including both add-on adapters in the Data Center and
stand-alone virtualized/universal CPE devices at the edge.
Silicom's long-term, trusted relationships with more than 150
customers throughout the world, its more than 400 active Design
Wins and more than 300 product SKUs have made Silicom a "go-to"
connectivity/performance partner of choice for technology leaders
around the globe.
For more information, please visit: www.silicom.co.il
Statements in this press release which are not historical data
are forward-looking statements which involve known and unknown
risks, uncertainties, or other factors not under the company's
control, which may cause actual results, performance, or
achievements of the company to be materially different from the
results, performance, or other expectations implied by these
forward-looking statements. These factors include, but are not
limited to, Silicom's increasing dependence for substantial revenue
growth on a limited number of customers in the evolving cloud-based
market, the speed and extent to which cloud-based and cloud-focused
solutions are adopted by the market, likelihood that it will rely
increasingly on customers which provide cloud-based and
cloud-focused solutions in this evolving market, resulting in an
increasing dependence on a smaller number of larger customers,
difficulty in commercializing and marketing of Silicom's products
and services, maintaining and protecting brand recognition,
protection of intellectual property, competition and other factors
detailed in the company's periodic filings with the Securities and
Exchange Commission. These forward-looking statements can generally
be identified as such because the context of the statement will
include words, such as "expects," "should," "believes,"
"anticipates" or words of similar import. Similarly, statements
that describe future plans, objectives or goals are also
forward-looking statements. In light of significant risks and
uncertainties inherent in forward-looking statements, the inclusion
of such statements should not be regarded as a representation by
the company that it will achieve such forward-looking statements.
The company disclaims any duty to update such statements, whether
as a result of new information, future events, or otherwise.
-- FINANCIAL TABLES FOLLOW –
Silicom Ltd.
Consolidated Balance Sheets
(US$
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
2018
|
|
2017
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
32,676
|
|
$
|
17,021
|
Marketable
securities
|
|
-
|
|
|
7,752
|
Accounts receivables:
Trade, net
|
|
27,443
|
|
|
41,367
|
Accounts receivables:
Other
|
|
5,252
|
|
|
5,823
|
Inventories
|
|
49,571
|
|
|
51,487
|
Total current
assets
|
|
114,942
|
|
|
123,450
|
|
|
|
|
|
|
Marketable
securities
|
|
19,877
|
|
|
5,945
|
Assets held for
employees' severance benefits
|
|
1,536
|
|
|
1,591
|
Deferred tax
assets
|
|
970
|
|
|
899
|
Property, plant
and equipment, net
|
|
3,666
|
|
|
4,121
|
Intangible assets,
net
|
|
894
|
|
|
1,047
|
Goodwill
|
|
25,561
|
|
|
25,561
|
|
|
|
|
|
|
Total
assets
|
$
|
167,446
|
|
$
|
162,614
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Trade accounts
payable
|
$
|
16,330
|
|
$
|
12,629
|
Other accounts
payable and accrued expenses
|
|
5,510
|
|
|
6,420
|
|
|
|
|
|
|
Total current
liabilities
|
|
21,840
|
|
|
19,049
|
|
|
|
|
|
|
Liability for
employees' severance benefits
|
|
2,663
|
|
|
2,765
|
|
|
|
|
|
|
Total
liabilities
|
|
24,503
|
|
|
21,814
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Ordinary shares and
additional paid-in capital
|
|
53,077
|
|
|
51,931
|
Treasury
shares
|
|
(38)
|
|
|
(38)
|
Retained
earnings
|
|
89,904
|
|
|
88,907
|
Total
shareholders' equity
|
|
142,943
|
|
|
140,800
|
|
|
|
|
|
|
Total liabilities
and shareholders' equity
|
$
|
167,446
|
|
$
|
162,614
|
Silicom Ltd.
Consolidated Statements of Operations
(US$ thousands,
except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-month
period
|
|
Six-month
period
|
|
ended June
30,
|
|
ended June
30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Sales
|
$
|
27,603
|
|
$
|
30,266
|
|
$
|
57,125
|
|
$
|
55,608
|
Cost of
sales
|
|
18,714
|
|
|
19,142
|
|
|
43,686
|
|
|
34,899
|
Gross
profit
|
|
8,889
|
|
|
11,124
|
|
|
13,439
|
|
|
20,709
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development expenses
|
|
3,647
|
|
|
3,328
|
|
|
7,078
|
|
|
6,842
|
Selling and marketing
expenses
|
|
1,596
|
|
|
1,593
|
|
|
3,132
|
|
|
3,235
|
General and
administrative expenses
|
|
1,068
|
|
|
1,109
|
|
|
1,975
|
|
|
2,298
|
Total operating
expenses
|
|
6,311
|
|
|
6,030
|
|
|
12,185
|
|
|
12,375
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
2,578
|
|
|
5,094
|
|
|
1,254
|
|
|
8,334
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial income,
net
|
|
200
|
|
|
13
|
|
|
484
|
|
|
43
|
Income (Loss) before
income taxes
|
|
2,778
|
|
|
5,107
|
|
|
1,738
|
|
|
8,377
|
Income
taxes
|
|
342
|
|
|
914
|
|
|
741
|
|
|
1,587
|
Net income
(loss)
|
$
|
2,436
|
|
$
|
4,193
|
|
$
|
997
|
|
$
|
6,790
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic income (loss)
per ordinary share (US$)
|
$
|
0.32
|
|
$
|
0.57
|
|
$
|
0.13
|
|
$
|
0.92
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of ordinary shares used to compute basic income per share
(in thousands)
|
|
7,550
|
|
|
7,420
|
|
|
7,550
|
|
|
7,401
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income (loss)
per ordinary share (US$)
|
$
|
0.32
|
|
$
|
0.55
|
|
$
|
0.13
|
|
$
|
0.90
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of ordinary shares used to compute diluted income per share
(in thousands)
|
|
7,629
|
|
|
7,573
|
|
|
7,671
|
|
|
7,536
|
Silicom Ltd.
Reconciliation of Non-GAAP Financial Results
(US$ thousands,
except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-month
period
|
|
Six-month
period
|
|
ended June
30,
|
|
ended June
30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
profit
|
$
|
8,889
|
|
$
|
11,124
|
|
$
|
13,439
|
|
$
|
20,709
|
(1) Share-based
compensation (*)
|
|
87
|
|
|
83
|
|
|
146
|
|
|
176
|
(2) Discontinued
project-related write-offs
|
|
-
|
|
|
-
|
|
|
4,985
|
|
|
-
|
Non-GAAP gross
profit
|
$
|
8,976
|
|
$
|
11,207
|
|
$
|
18,570
|
|
$
|
20,885
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating income
(loss)
|
$
|
2,578
|
|
$
|
5,094
|
|
$
|
1,254
|
|
$
|
8,334
|
Gross profit
adjustments
|
|
87
|
|
|
83
|
|
|
5,131
|
|
|
176
|
(1) Share-based
compensation (*)
|
|
522
|
|
|
457
|
|
|
923
|
|
|
1,125
|
(2) Discontinued
project-related write-offs
|
|
-
|
|
|
-
|
|
|
13
|
|
|
-
|
(3) Amortization of
acquired intangible assets
|
|
314
|
|
|
479
|
|
|
617
|
|
|
955
|
(4) Changes in the
fair value of contingent consideration
|
|
-
|
|
|
60
|
|
|
-
|
|
|
118
|
Non-GAAP operating
income
|
$
|
3,501
|
|
$
|
6,173
|
|
$
|
7,938
|
|
$
|
10,708
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
$
|
2,436
|
|
$
|
4,193
|
|
$
|
997
|
|
$
|
6,790
|
Operating income
adjustments
|
|
923
|
|
|
1,079
|
|
|
6,684
|
|
|
2,374
|
(5) Taxes on
amortization of acquired intangible assets
|
|
8
|
|
|
(27)
|
|
|
16
|
|
|
(53)
|
Non-GAAP net
income
|
$
|
3,367
|
|
$
|
5,245
|
|
$
|
7,697
|
|
$
|
9,111
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
$
|
2,436
|
|
$
|
4,193
|
|
$
|
997
|
|
$
|
6,790
|
Adjustments for
Non-GAAP cost of sales
|
|
87
|
|
|
83
|
|
|
5,131
|
|
|
176
|
Adjustments for
Non-GAAP Research and development expenses
|
|
420
|
|
|
512
|
|
|
770
|
|
|
1,054
|
Adjustments for
Non-GAAP Selling and marketing expenses
|
|
252
|
|
|
272
|
|
|
480
|
|
|
620
|
Adjustments for
Non-GAAP General and administrative expenses
|
|
164
|
|
|
212
|
|
|
303
|
|
|
524
|
Adjustments for
Non-GAAP Income taxes
|
|
8
|
|
|
(27)
|
|
|
16
|
|
|
(53)
|
Non-GAAP net
income
|
$
|
3,367
|
|
$
|
5,245
|
|
$
|
7,697
|
|
$
|
9,111
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP basic income
(loss) per ordinary share (US$)
|
$
|
0.32
|
|
$
|
0.57
|
|
$
|
0.13
|
|
$
|
0.92
|
(1) Share-based
compensation (*)
|
|
0.08
|
|
|
0.07
|
|
|
0.14
|
|
|
0.18
|
(2) Discontinued
project-related write-offs
|
|
-
|
|
|
-
|
|
|
0.66
|
|
|
-
|
(3-5)
Acquisition-related adjustments
|
|
0.05
|
|
|
0.07
|
|
|
0.09
|
|
|
0.13
|
Non-GAAP basic income
per ordinary share (US$)
|
$
|
0.45
|
|
$
|
0.71
|
|
$
|
1.02
|
|
$
|
1.23
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted income
(loss) per ordinary share (US$)
|
$
|
0.32
|
|
$
|
0.55
|
|
$
|
0.13
|
|
$
|
0.90
|
(1) Share-based
compensation (*)
|
|
0.08
|
|
|
0.07
|
|
|
0.14
|
|
|
0.17
|
(2) Discontinued
project-related write-offs
|
|
-
|
|
|
-
|
|
|
0.65
|
|
|
-
|
(3-5)
Acquisition-related adjustments
|
|
0.04
|
|
|
0.07
|
|
|
0.08
|
|
|
0.14
|
Non-GAAP diluted
income per ordinary share (US$)
|
$
|
0.44
|
|
$
|
0.69
|
|
$
|
1.00
|
|
$
|
1.21
|
|
|
|
|
|
|
|
|
|
|
|
|
(*) Adjustments
related to share-based compensation expenses according to ASC topic
718 (SFAS 123 (R))
|
Company Contact:
Eran
Gilad, CFO
Silicom Ltd.
Tel: +972-9-764-4555
E-mail: erang@silicom.co.il
Investor Relations Contact:
Ehud Helft/ Gavriel Frohwein
GK Investor Relations
Tel: +1-646-668-3559
E-mail: silicom@gkir.com
View original
content:http://www.prnewswire.com/news-releases/silicom-reports-q2-2018-financial-results-300687007.html
SOURCE Silicom Ltd.