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Actions Semiconductor Reports Fourth Quarter and Full Year 2013 Results

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SOURCE Actions Semiconductor Co., Ltd.

Fourth Quarter Revenue Up 15.9% Year-Over-Year

ZHUHAI, China, Jan. 27, 2014 /PRNewswire/ -- Actions Semiconductor Co., Ltd. (Nasdaq: ACTS) ("Actions Semiconductor" or "the Company"), one of China's leading fabless semiconductor companies that provides comprehensive portable multimedia and mobile internet system-on-a-chip (SoC) solutions for portable consumer electronics, today reported its financial results for the fourth quarter and year ended December 31, 2013.

All financial results are reported on a U.S. GAAP basis.

Revenue for the fourth quarter of 2013 was $17.6 million, as compared to revenue of $16.9 million for the third quarter of 2013, and $15.2 million for the fourth quarter of 2012. 

Revenue for the year ended December 31, 2013 was $69.4 million, compared to $54.3 million for the year ended December 31, 2012.

Net loss attributable to Actions Semiconductor's shareholders for the fourth quarter of 2013 was $0.8 million or $0.012 per basic and diluted American Depositary Share ("ADS").  This compares to net loss attributable to Actions Semiconductor's shareholders of $0.2 million or $0.002 per basic and diluted ADS, for the third quarter of 2013, and a net loss attributable to Actions Semiconductor's shareholders of $1.7 million or $0.024 per basic and diluted ADS, for the fourth quarter of 2012. 

Net income attributable to Actions Semiconductor's shareholders for the year ended December 31, 2013 was $0.1 million or $0.002 per basic and diluted ADS.  This compares to a net loss attributable to Actions Semiconductor's shareholders of $2.2 million or $0.032 per basic and diluted ADS, for the year ended December 31, 2012. 

Actions Semiconductor reported gross margin of 22.2% for the fourth quarter of 2013, compared to gross margin of 33.2% for the third quarter of 2013, and 32.1% for the fourth quarter of 2012.  The Company ended the fourth quarter with $224.6 million in cash and cash equivalents, together with time deposits, trading securities and marketable securities, current and non-current.

Since the share repurchase program commenced in 2007, the Company has invested approximately $50.4 million in repurchasing its shares.  As of December 31, 2013, approximately 22.1 million American Depositary Shares (ADSs) were repurchased.

"The year of 2013 was a critical one for our Company.  We achieved top line growth of 28%, above our 25% target, and improved our bottom line.  Following the successful introduction of our OWL series product family, we have made good progress in penetrating the white-box tablet market and carving market share.  We are also excited about the new growth opportunity brought by wireless connectivity to our traditional multimedia business.  During the fourth quarter, our second generation dual-core solution, ATM7021, made further inroads in the low-end of the tablet market and our new Bluetooth enabled boombox solutions reached volume shipments," stated Dr. Zhenyu Zhou, CEO of Actions Semiconductor.

"As we enter 2014, we are targeting full year revenue growth between 20% and 25%.  We believe our  OWL series product family provides us with the opportunity to gain share in each segment of the tablet market in 2014, as tablet manufacturers continue migrating to dual-core chipsets for their low-end products and accelerate the use of quad-core solutions for their mid- to high-end models.   At the same time, we expect our newer wireless connectivity enabled multimedia products such as our Bluetooth boombox solutions to make a meaningful contribution to our revenue."

"We believe, as one of the leading design houses in China, our profitability is directly linked to our ability to maintain technology leadership and provide compelling products at each targeted market segment.  In 2014, we will streamline our research and development organization while investing in intellectual property and talent as we seek to enhance our brand image for both multimedia and tablet products," Dr. Zhou concluded.

Business Outlook

The following statements are based upon management's current expectations.  These statements are forward-looking, and actual results may differ materially.  The Company undertakes no obligation to update these statements.

Based on current market trends, the Company expects revenue in the first quarter of 2014 to be in the range of $12.0 to $13.0 million.  This reflects the return to a more traditional seasonal sales pattern compared to the same period last year, when the Company experienced a steep ramp in shipments associated with the introduction of its new tablet SoC solutions.

The first quarter of the year is traditionally the Company's seasonally slowest quarter due to the Chinese New Year holiday, which causes a slowdown in production by consumer electronics manufacturers in China for approximately three to four weeks.

Conference Call Details

Actions Semiconductor's fourth quarter of fiscal year 2013 teleconference and webcast is scheduled to begin at 8:00 a.m. Eastern Time, on Monday, January 27, 2014.  To participate in the live call, analysts and investors should dial 1-877-941-1465 (within U.S.) or 1-480-629-9723 (outside U.S.) at least ten minutes prior to the call.  Actions Semiconductor will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the Company's website at www.actions-semi.com.  An audio replay of the call will be available to investors through February 6, 2014 by dialing 1-800-406-7325 (within U.S.) or 1-303-590-3030 (outside U.S.) and entering access code 4662006.

About Actions Semiconductor

Actions Semiconductor is one of China's leading fabless semiconductor companies that provides comprehensive portable multimedia and mobile internet system-on-a-chip (SoC) solutions for portable consumer electronics.  Actions Semiconductor products include SoCs, firmware, software, solution development kits, as well as detailed specifications of other required components.  Actions Semiconductor also provides total product and technology solutions that allow customers to quickly introduce new portable consumer electronics to the mass market in a cost effective way.  The Company is headquartered in Zhuhai, China, with offices in Shanghai and Shenzhen.  For more information, please visit the Actions Semiconductor website at http://www.actions-semi.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995

Statements contained in this release that are not historical facts are forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements concerning the outlook for its dual-core and quad-core solutions in domestic and overseas markets, customer acceptance of the Actions Semiconductor's new products and corresponding increases in market share, Actions Semiconductor's belief that it is positioned to capture some upside from these trends, and Actions Semiconductor's future expectations with respect to revenue growth.  Actions Semiconductor uses words like "believe," "anticipate," "intend," "estimate," "expect," "project" and similar expressions to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements are estimates reflecting current assumptions, expectations and projections about future events and involve significant risks, both known and unknown, uncertainties and other factors that may cause Actions Semiconductor's actual performance, financial condition or results of operations to be materially different from those suggested by the forward-looking statements including, among others, customers' cancellation or modification of their orders; our failure to accurately forecast demand for our products; the loss of, or a significant reduction in orders from, any of our significant customers; fluctuations in our operating results; our inability to develop and sell new products; defects in or failures of our products; the expense and uncertainty involved in our customer design-win efforts; the financial viability of the distributors of our products; consumer demand; worldwide economic and political conditions; fluctuations in our costs to manufacture our products; our reliance on third parties to manufacture, test, assemble and ship our products; our ability to retain and attract key personnel; our ability to compete with our competitors; and our ability to protect our intellectual property rights and not infringe the intellectual property rights of others. Other factors that may cause our actual results to differ from those set forth in the forward-looking statements contained in this press release and that may affect our prospects in general are described in our filings with the Securities and Exchange Commission, including our most recently filed Forms F-1, 20-F and 6-Ks. Other unknown or unpredictable factors also could have material adverse effects on Actions Semiconductor's future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this press release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this press release. Except as required by law, Actions Semiconductor undertakes no obligation and does not intend to update or revise any forward-looking statement to reflect subsequent events or changed assumptions or circumstances.

Investor Contacts:


Elaine Ketchmere, CFA 

Ally Xie, CA, CPA

Compass Investor Relations 

Actions Semiconductor

eketchmere@compass-ir.com 

investor.relations@actions-semi.com

+1-310-528-3031 

+86-756-3392353*1018

 

ACTIONS SEMICONDUCTOR CO., LTD.

CONSOLIDATED CONDENSED BALANCE SHEET

(in thousands of U.S. dollars)








At December 31,


At September 30,


At December 31,


2013


2013


2012


(unaudited)


(unaudited)


(audited)

ASSETS






Current assets:






  Cash and cash equivalents

53,263


67,884


71,336

  Time deposits

27,508


21,453


10,000

  Marketable securities

126,607


126,282


130,721

  Trading securities

74


75


76

  Accounts receivable

5,782


7,294


5,950

  Notes receivable

-


37


-

  Amount due from a related party

1,301


-


340

  Amount due from an equity method investee

38


75


79

  Inventories, net of inventory written-down of $1,558, $1,276 and $701 as of 
 
December 31, 2013, September 30, 2013 and December 31, 2012, respectively

20,278


25,414


11,979

  Prepaid expenses and other current assets

3,972


3,018


4,288

  Income tax recoverable

67


79


189

  Deferred tax assets

416


466


504

Total current assets

239,306


252,077


235,462







  Investments in equity method investees

17,843


17,903


14,329

  Other investments 

15,648


16,321


16,305

  Marketable securities

17,139


-


11,239

  Rental deposits

61


66


49

  Property, plant and equipment, net

31,896


31,817


32,321

  Land use right

1,588


1,584


1,584

  Acquired intangible assets, net

12,218


11,101


10,819

  Deposit paid for acquisition of intangible assets

145


759


-

  Deferred tax assets

99


69


80

TOTAL ASSETS

335,943


331,697


322,188







LIABILITIES AND EQUITY






Current liabilities:






  Accounts payable

6,016


6,317


8,073

  Accrued expenses and other current liabilities

6,127


5,688


8,411

  Short-term bank loans

35,500


30,500


20,500

  Other liabilities

1,362


2,176


2,056

  Income tax payable

49


49


49

  Deferred tax liabilities

343


260


534

Total current liabilities

49,397


44,990


39,623







  Other liabilities

412


13


13

  Payable for acquisition of intangible assets

-


128


603

  Deferred tax liabilities

3,589


3,597


3,189

Total liabilities

53,398


48,728


43,428

Equity:






  Ordinary shares

1


1


1

  Additional paid-in capital

18,882


20,154


20,202

  Accumulated other comprehensive income

40,734


39,061


35,751

  Retained earnings

222,959


223,784


222,835

Total Actions Semiconductor Co., Ltd. shareholders' equity

282,576


283,000


278,789

  Non-controlling interest

(31)


(31)


(29)

Total equity

282,545


282,969


278,760

TOTAL LIABILITIES AND EQUITY

335,943


331,697


322,188

         

ACTIONS SEMICONDUCTOR CO., LTD.

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS

(in thousands of U.S. dollars, except number of shares and per share amounts)












Three months ended


Three months ended


Year ended


Year ended



December 31,


December 31,


December 31,


December 31,



2013


2012


2013


2012



(unaudited)


(unaudited)


(unaudited)


(audited)










Revenues:









  Third-parties:









   System-on-a-chip products


15,095


14,314


64,617


52,356

   Semiconductor product testing services


29


28


135


179



15,124


14,342


64,752


52,535

  Related-parties:









   System-on-a-chip products


2,451


817


4,639


1,794

  Total revenues


17,575


15,159


69,391


54,329

Cost of revenues:









  Third-parties:









   System-on-a-chip products


(11,567)


(9,697)


(44,324)


(33,814)

   Semiconductor product testing services


(13)


(15)


(58)


(100)



(11,580)


(9,712)


(44,382)


(33,914)

  Related-parties:









   System-on-a-chip products


(2,094)


(587)


(3,583)


(1,193)

  Total cost of revenues


(13,674)


(10,299)


(47,965)


(35,107)

Gross profit


3,901


4,860


21,426


19,222

Other operating income


1,517


136


2,170


896

Operating expenses:









  Research and development


(6,086)


(6,195)


(25,995)


(23,739)

  General and administrative


(2,547)


(2,660)


(8,764)


(8,573)

  Selling and marketing


(614)


(364)


(2,057)


(1,281)

Total operating expenses


(9,247)


(9,219)


(36,816)


(33,593)

Loss from operations


(3,829)


(4,223)


(13,220)


(13,475)

Other income


779


1,674


2,336


1,547

Dividend income from an other investment


0


0


493


0

Fair value change in trading securities


0


0


0


2

Other-than-temporary impairment loss on investments


(681)


(2,543)


(681)


(2,543)

Interest income


3,241


3,257


12,358


13,240

Interest expense


(146)


(63)


(498)


(250)

(Loss) income before income taxes, equity in net (loss) income of
equity method investees and non-controlling interest


(636)


(1,898)


788


(1,479)

Income tax (expense) credit


(108)


370


(403)


(772)

Equity in net (loss) income of equity method investees


(82)


(128)


(264)


41

Net (loss) income


(826)


(1,656)


121


(2,210)

Less: Net loss attributable to non-controlling interest


1


1


2


8

Net (loss) income attributable to Actions Semiconductor Co., Ltd. Shareholders


(825)


(1,655)


123


(2,202)










Net (loss) income attributable to Actions Semiconductor Co., Ltd. Shareholders









Basic (per share)


(0.002)


(0.004)


0.000


(0.005)










Diluted (per share)


(0.002)


(0.004)


0.000


(0.005)










Basic (per ADS)


(0.012)


(0.024)


0.002


(0.032)

Diluted (per ADS)


(0.012)


(0.024)


0.002


(0.032)










Weighted-average shares used in computation:









Basic


412,162,575


410,209,703


412,103,255


412,706,341

Diluted


412,162,575


410,209,703


425,415,011


412,706,341










Weighted-average ADS used in computation:









Basic


68,693,763


68,368,284


68,683,876


68,784,390

Diluted


68,693,763


68,368,284


70,902,502


68,784,390










Note: Share-based compensation recorded in each

expense classification above is as follows:









  Research and development


74


229


347


1,090

  General and administrative


25


67


79


312

  Selling and marketing


3


12


17


52

  Cost of revenues


0


0


49


10

      

ACTIONS SEMICONDUCTOR CO., LTD.

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(in thousands of U.S. dollars)










Three months ended


Year ended


Year ended



December 31,


December 31,


December 31,



2013


2013


2012



(unaudited)


  (unaudited)  


  (audited)  

Operating activities:







Net (loss) income 


(826)


121


(2,210)

Adjustments to reconcile net (loss) income provided by







  Operating activities:







  Depreciation of property, plant and equipment


508


2,072


2,290

  Amortization of land use right


9


36


36

  Amortization of acquired intangible assets


923


3,480


3,056

  Utilization of subsidy from local authorities of Zhuhai, 

  the People's Republic of China ("PRC")


(846)


(1,068)


(674)

  Write down of inventories


282


865


180

  Loss on disposal of property, plant and equipment 


-


-


5

  Share of net loss (income) of equity method investees


82


264


(41)

  Share-based compensation


102


492


1,465

  Fair value change in trading securities


-


-


(2)

  Deferred taxes


94


279


454

  Proceeds from disposal of trading securities


-


-


459

  Dividend income from an other investment


-


(493)


-

  Impairment loss recognised in respect of other investments


681


681


2,543

  Changes in operating assets and liabilities:







    Accounts receivable


1,525


195


(3,150)

    Notes receivable


37


-


-

    Amount due from a related party


(1,301)


(961)


(331)

    Inventories


5,062


(8,686)


(4,510)

    Amount due from an equity method investee


37


41


(14)

    Prepaid expenses and other current assets


(930)


5,922


(2,549)

    Accounts payable


(330)


(2,198)


3,598

    Accrued expenses and other current liabilities


348


(3,051)


(3,526)

    Income tax recoverable


13


123


(189)

    Income tax payable


1


2


(190)

    Rental deposit received (paid) 


5


(11)


4

Net cash provided by (used in) operating activities


5,476


(1,895)


(3,296)








Investing activities:







  Investment in an equity method investee


-


(3,712)


(1,500)

  Proceeds from redemption of marketable securities


13,434


112,966


178,975

  Purchase of marketable securities


(30,529)


(113,329)


(132,376)

  Proceeds from disposal of property, plant and equipment


25


41


22

  Purchase of property, plant and equipment


(340)


(862)


(249)

  Purchase of intangible assets


(1,199)


(3,884)


(1,081)

  Deposit paid for acquisition of intangible assets


(145)


(904)


-

  Increase in time deposits 


(5,960)


(17,159)


(10,000)

Net cash (used in) provided by investing activities


(24,714)


(26,843)


33,791








Financing activities:







  Proceeds from short-term bank loans


5,000


10,000


8,500

  Advance subsidy from local authorities of Zhuhai, the PRC


412


714


299

  Proceeds from exercise of share option and restricted stock unit


471


3,041


2,289

  Repurchase of ordinary shares


(1,845)


(4,853)


(4,152)

Net cash provided by financing activities


4,038


8,902


6,936








Net (decrease) increase in cash and cash equivalents


(15,200)


(19,836)


37,431








Cash and cash equivalents at the beginning of the period


67,884


71,336


33,207








Effect of exchange rate changes on cash


579


1,763


698

Cash and cash equivalents at the end of the period


53,263


53,263


71,336

 

 

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