KFAR SAVA, Israel, April 30, 2020 /PRNewswire/ -- Silicom
Ltd. (NASDAQ: SILC), a leading provider of high-performance
networking and data infrastructure solutions, today reported its
financial results for the first quarter ended March 31, 2020.
Financial Results
Revenues for the first quarter of 2020 totaled $22.1 million compared with $30.2 million for the first quarter of 2019. This
is at the higher end of the updated guidance provided on
April 6, 2020, and
is approximately 15% below earlier estimates provided in late
January, prior to the global disruption caused by the COVID-19
pandemic.
On a GAAP basis, net income for the quarter totaled $1.5 million, or $0.20 per share (basic and diluted), compared
with $3.6 million, or $0.48 per share (basic and diluted) for the first
quarter of 2019.
On a non-GAAP basis (as described and reconciled below),
non-GAAP net income for the period totaled $2.3 million, or $0.31 per share (basic and diluted), compared
with $4.0 million, or $0.52 per diluted share ($0.53 per basic share), for the first quarter of
2019. This is the Company's 61st profitable quarter.
Silicom's cash position as of the end of the quarter, which
includes cash, cash equivalents, deposits and marketable securities
and zero debt, totaled $79.9 million
dollars (or $11.05 per
outstanding share).
Share Repurchase Plan
In addition, the Company today announced that its Board of
Directors has authorized a new one-year share repurchase plan
allowing the Company to invest up to $15
million to repurchase its ordinary shares. This plan will
begin as soon as the previously-announced $15 million one-year share repurchase plan is
completed. The timing and actual number of shares repurchased will
depend upon a variety of factors, including price and general
business and market conditions. The share repurchase plan
authorizes management to repurchase ordinary shares using a variety
of methods, including open market purchases, all in compliance with
the rules of the US Securities and Exchange Commission and other
applicable legal requirements. Repurchases will be funded from
available working capital. The share repurchase plan does not
obligate Silicom to buy back any specific number of shares and may
be suspended or terminated at any time at management's
discretion.
Management notes that its cash balance provides sufficient
working capital and financial flexibility to weather the current
environment while completing the Company's current share buy-back
program and carrying out this new share buy-back program.
Comments of Management
Shaike Orbach, Silicom's
President and CEO, commented, "We are pleased to
report our 61st consecutive profitable quarter despite
the severe disruption associated with the global COVID-19
environment. As we noted earlier this month, 2020 was off to an
excellent start before the pandemic took hold, slowing our supply
chain and interrupting manufacturing and deliveries. Given the
significant challenges inherent in the situation, we are pleased
with our first quarter financial results.
"While short-term visibility is still very low, the fundamentals
of our business remain intact, and we remain optimistic about our
mid- and long-term prospects. The broadband boom that has been
driven by the need to 'shelter at home' is actually creating a new
urgency for telco and Cloud-player investments in new SD-WAN, NFV,
Security and 5G networks, highlighting the importance of our
enabling solutions. As a result, interest in our solutions remains
high and we continue to make progress on high-potential new design
wins.
"For example, we were recently chosen to supply $15 million worth of Intelligent Bypass solutions
for a massive governmental infrastructure project, and the
project's integrator expects additional similar projects over
time."
Mr. Orbach concluded, "While it is too early to predict exactly
when we will reach the 'new normal,' we are optimistic that it will
be a reality in which networks and connectivity rise to even
greater importance. With strong existing design wins and continued
interest from some of the market's key players, we believe that we
will benefit from several years of solid double-digit Compound
Annual Growth Rate once the impact of the pandemic is behind us.
Until the dust clears, our ongoing activities and cash position are
strong enough to carry us past temporary challenges."
Conference Call Details
Silicom's Management will host an interactive conference today,
April 30th, 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: 1 888 668 9141
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, as well as taxes on
amortization of acquired intangible assets. 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 170
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, SD-WAN, NFV and Edge markets, the speed and extent to
which solutions are adopted by these markets, likelihood that
Silicom will rely increasingly on customers which provide solutions
in these evolving markets, 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, disruptions to our manufacturing and development along
with general disruptions to the entire world economy relating to
the spread of the novel coronavirus (COVID-19) 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)
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
2020
|
|
2019
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
12,120
|
|
$
|
16,469
|
Short-term bank
deposits
|
|
7,000
|
|
|
13,542
|
Marketable
securities
|
|
24,882
|
|
|
14,045
|
Accounts receivables:
Trade, net
|
|
15,705
|
|
|
24,936
|
Accounts receivables:
Other
|
|
9,283
|
|
|
4,964
|
Inventories
|
|
39,399
|
|
|
36,491
|
Total current
assets
|
|
108,389
|
|
|
110,447
|
|
|
|
|
|
|
Marketable
securities
|
|
35,937
|
|
|
46,542
|
Assets held for
employees' severance benefits
|
|
1,574
|
|
|
1,640
|
Deferred tax
assets
|
|
1,756
|
|
|
1,798
|
Property, plant
and equipment, net
|
|
3,582
|
|
|
3,574
|
Intangible assets,
net
|
|
2,385
|
|
|
1,718
|
Right of
Use
|
|
3,438
|
|
|
3,783
|
Goodwill
|
|
25,561
|
|
|
25,561
|
Total
assets
|
$
|
182,622
|
|
$
|
195,063
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Trade accounts
payable
|
$
|
9,909
|
|
$
|
16,419
|
Other accounts
payable and accrued expenses
|
|
6,021
|
|
|
8,823
|
Lease
Liabilities
|
|
1,018
|
|
|
1,090
|
|
|
|
|
|
|
Total current
liabilities
|
|
16,948
|
|
|
26,332
|
|
|
|
|
|
|
Lease
Liabilities
|
|
2,296
|
|
|
2,693
|
Liability for
employees' severance benefits
|
|
2,878
|
|
|
2,910
|
Deferred tax
liabilities
|
|
230
|
|
|
205
|
|
|
|
|
|
|
Total
liabilities
|
|
22,352
|
|
|
32,140
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Ordinary shares and
additional paid-in capital
|
|
57,874
|
|
|
57,152
|
Treasury
shares
|
|
(12,872)
|
|
|
(8,009)
|
Retained
earnings
|
|
115,268
|
|
|
113,780
|
Total
shareholders' equity
|
|
160,270
|
|
|
162,923
|
|
|
|
|
|
|
Total liabilities
and shareholders' equity
|
$
|
182,622
|
|
$
|
195,063
|
Silicom Ltd.
Consolidated Statements of Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(US$ thousands,
except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-month
period
|
|
|
|
ended March
31,
|
|
|
|
|
|
2020
|
|
2019
|
Sales
|
|
|
|
|
|
|
$
|
22,070
|
|
$
|
30,227
|
Cost of
sales
|
|
|
|
|
|
|
|
14,951
|
|
|
20,047
|
Gross
profit
|
|
|
|
|
|
|
|
7,119
|
|
|
10,180
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development expenses
|
|
|
|
|
|
|
|
3,800
|
|
|
3,820
|
Selling and marketing
expenses
|
|
|
|
|
|
|
|
1,539
|
|
|
1,629
|
General and
administrative expenses
|
|
|
|
|
|
|
|
913
|
|
|
1,023
|
Total operating
expenses
|
|
|
|
|
|
|
|
6,252
|
|
|
6,472
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
|
|
|
|
|
|
867
|
|
|
3,708
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial income,
net
|
|
|
|
|
|
|
|
1,031
|
|
|
295
|
Income (Loss) before
income taxes
|
|
|
|
|
|
|
|
1,898
|
|
|
4,003
|
Income
taxes
|
|
|
|
|
|
|
|
410
|
|
|
363
|
Net income
(loss)
|
|
|
|
|
|
|
$
|
1,488
|
|
$
|
3,640
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic income (loss)
per ordinary share (US$)
|
|
|
|
|
|
|
$
|
0.20
|
|
$
|
0.48
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of ordinary shares used to
compute basic income per share (in thousands)
|
|
|
|
|
|
|
|
7,309
|
|
|
7,586
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income (loss)
per ordinary share (US$)
|
|
|
|
|
|
|
$
|
0.20
|
|
$
|
0.48
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of ordinary shares used to
compute diluted income per share (in thousands)
|
|
|
|
|
|
|
|
7,336
|
|
|
7,654
|
Silicom Ltd.
Reconciliation of Non-GAAP Financial Results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(US$ thousands,
except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-month
period
|
|
|
|
|
|
|
|
|
ended March
31,
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
profit
|
|
|
|
|
|
|
$
|
7,119
|
|
$
|
10,180
|
|
(1) Share-based
compensation (*)
|
|
|
|
|
|
|
|
171
|
|
|
116
|
|
Non-GAAP gross
profit
|
|
|
|
|
|
|
$
|
7,290
|
|
$
|
10,296
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating income
(loss)
|
|
|
|
|
|
|
$
|
867
|
|
$
|
3,708
|
|
Gross profit
adjustments
|
|
|
|
|
|
|
|
171
|
|
|
116
|
|
(1) Share-based
compensation (*)
|
|
|
|
|
|
|
|
551
|
|
|
538
|
|
Non-GAAP operating
income
|
|
|
|
|
|
|
$
|
1,589
|
|
$
|
4,362
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
|
|
|
|
|
|
$
|
1,488
|
|
$
|
3,640
|
|
Operating income
adjustments
|
|
|
|
|
|
|
|
722
|
|
|
654
|
|
(2) Taxes on
amortization of acquired intangible assets
|
|
|
|
|
|
|
|
67
|
|
|
(278)
|
|
Non-GAAP net
income
|
|
|
|
|
|
|
$
|
2,277
|
|
$
|
4,016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
|
|
|
|
|
|
$
|
1,488
|
|
$
|
3,640
|
|
Adjustments for
Non-GAAP cost of sales
|
|
|
|
|
|
|
|
171
|
|
|
116
|
|
Adjustments for
Non-GAAP Research and development expenses
|
|
|
|
|
|
|
|
247
|
|
|
246
|
|
Adjustments for
Non-GAAP Selling and marketing expenses
|
|
|
|
|
|
|
|
144
|
|
|
139
|
|
Adjustments for
Non-GAAP General and administrative expenses
|
|
|
|
|
|
|
|
160
|
|
|
153
|
|
Adjustments for
Non-GAAP Income taxes
|
|
|
|
|
|
|
|
67
|
|
|
(278)
|
|
Non-GAAP net
income
|
|
|
|
|
|
|
$
|
2,277
|
|
$
|
4,016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP basic income
(loss) per ordinary share (US$)
|
|
|
|
|
|
|
$
|
0.20
|
|
$
|
0.48
|
|
(1) Share-based
compensation (*)
|
|
|
|
|
|
|
|
0.10
|
|
|
0.09
|
|
(2)
Acquisition-related adjustments
|
|
|
|
|
|
|
|
0.01
|
|
|
(0.04)
|
|
Non-GAAP basic income
per ordinary share (US$)
|
|
|
|
|
|
|
$
|
0.31
|
|
$
|
0.53
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted income
(loss) per ordinary share (US$)
|
|
|
|
|
|
|
$
|
0.20
|
|
$
|
0.48
|
|
(1) Share-based
compensation (*)
|
|
|
|
|
|
|
|
0.10
|
|
|
0.08
|
|
(2)
Acquisition-related adjustments
|
|
|
|
|
|
|
|
0.01
|
|
|
(0.04)
|
|
Non-GAAP diluted
income per ordinary share (US$)
|
|
|
|
|
|
|
$
|
0.31
|
|
$
|
0.52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*) 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
GK Investor Relations
Tel: +1-646-201-9246
E-mail: silicom@gkir.com
View original content to download
multimedia:http://www.prnewswire.com/news-releases/silicom-reports-q1-2020-financial-results-301050042.html
SOURCE Silicom Ltd.