OmniVision Reports Record Financial Results for Fiscal Third Quarter 20068 March 2006
OmniVision Technologies, Inc. (Nasdaq: OVTI), a leading supplier of CMOS image sensors, today reported financial results for the third quarter of fiscal 2006 which ended January 31, 2006.
Revenue for the third quarter was a record $137.3 million, up from $126.8 million in the second quarter of fiscal 2006, and $101.8 million in the third quarter of fiscal 2005. Net income in the third quarter was $29.6 million, or $0.53 per diluted share, compared to net income of $22.6 million, or $0.41 per diluted share, in the second quarter, and net income of $21.1 million, or $0.33 per diluted share, in the prior-year period.
Revenue for the first nine months of fiscal 2006 was $360.1 million, compared to $285.1 million for the same period in fiscal 2005. Net income for the first nine months of fiscal 2006 was $66.6 million, or $1.18 per diluted share, compared to net income of $58.7 million, or $0.94 per diluted share, for the same period in fiscal 2005.
Growth was particularly strong in the mobile handset market, which accounted for slightly more than 75% of OmniVision's revenues in the quarter. The entire range of the Company's image sensors designed specifically for camera phone applications benefited from the overall strength of this market.
OmniVision's advanced products business continued to reach new milestones. Beginning in the third quarter, the Company increased its shipments to multiple leading toy and video game console vendors. OmniVision also began shipping to top-tier automotive parts suppliers, reaching a new market that the Company anticipates will continue to grow through 2006 and beyond.
Gross margin for the third quarter was 40.3% compared to 36.1% last quarter. The improvement in gross margin was the result of favorable product mix and improved production yields. The Company booked additional provisions for excess and obsolete inventory of approximately $5.2 million during the quarter. Revenue from the sale of previously reserved inventory was $2.2 million.
The Company ended the period with cash and short-term investments totaling $317.0 million.
"We are pleased to report that OmniVision delivered another quarter of revenue and earnings growth," said Shaw Hong, OmniVision's president and chief executive officer. "Favorable market conditions, especially in mobile handsets, helped the Company leverage its operating model to achieve strong earnings growth.
"Looking ahead, we believe that our recent significant design wins will provide additional opportunities for OmniVision in the second half of 2006. Beginning in the July quarter, our new 2 megapixel sensor will begin shipping in volume to large handset accounts will begin to ramp and we anticipate significant demand for our ultra thin VGA and our 1.3 megapixel sensors," concluded Mr. Hong.
Outlook
Based on current trends, the Company expects fiscal fourth quarter 2006 revenue will be in the range of $120-$130 million and diluted earnings will be in the range of $0.35-$0.40 per share.
Conference Call
OmniVision Technologies will host a conference call today to further discuss these results at 2:00 p.m. Pacific Time. This conference call may be accessed by dialing 800-591-6923 or 617-614-4907 and indicating passcode 24280918. The call can be accessed via a webcast at http://www.ovt.com.
A replay of the call will be available approximately one hour after the call and last for seven days. To access this replay, dial 617-801-6888 and enter passcode 99441035. A Web replay will be available for approximately 90 days at http://www.ovt.com.
About OmniVision
OmniVision Technologies designs and markets high-performance semiconductor image sensors. Its OmniPixel(TM) and CameraChip(TM) products are highly integrated single-chip CMOS image sensors for mass-market consumer and commercial applications such as mobile phones, digital still cameras, security and surveillance systems, interactive video games, PCs and automotive imaging systems. Additional information is available at http://www.ovt.com.
NOTE: OmniVision, CameraChip, and OmniPixel are trademarks of OmniVision Technologies, Inc.
Safe Harbor Statement
Certain statements in this press release, including statements relating to the Company's expectations regarding revenue and diluted earnings per share for the quarter ending April 30, 2006, the future growth of the automotive image sensor market, our optimism regarding future opportunities, and the anticipated distribution and demand for our products are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations, and important factors could cause actual results to differ materially from those in the forward-looking statements. These important factors include, without limitation, competition in current and emerging markets for image sensor products, including pricing pressures; the Company's ability to obtain design wins from various image sensor device manufacturers including manufacturers of mobile phone, digital still cameras and automobile manufacturers; wafer manufacturing yields and other manufacturing processes; the Company's ability to accurately forecast customer demand for its products; the development, production, introduction and marketing of new products and technology; the potential loss of one or more key customers or distributors; the continued growth and development of current markets and the emergence of new markets in which the Company sells, or may sell, its products; the acceptance of the Company's products in such current and new markets; the Company's strategic investments and relationships, and other risks detailed from time to time in the Company's Securities and Exchange Commission filings and reports, including, but not limited to, the Company's most recent annual report filed on Form 10-K, and its most recent quarterly report filed on Form 10-Q. The Company expressly disclaims any obligation to update information contained in any forward-looking statement.
OMNIVISION TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
(unaudited)
January 31, April 30,
2006 2005
ASSETS
Current assets:
Cash and cash equivalents $220,501 $204,057
Short-term investments 96,451 90,658
Accounts receivable, net 76,462 59,740
Inventories 62,542 58,429
Refundable and deferred income taxes 5,373 5,402
Prepaid expenses and other
current assets 7,509 2,542
Total current assets 468,838 420,828
Property, plant and equipment, net 35,437 19,342
Long-term investments 17,738 6,814
Goodwill 4,892 4,892
Intangibles, net 28,161 26,414
Other non-current assets 3,027 1,543
Total assets $558,093 $479,833
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 53,724 26,081
Accrued expenses and other current
liabilities 18,444 14,196
Accrued income taxes payable 46,373 32,313
Deferred income 14,810 5,483
Total current liabilities 133,351 78,073
Long-term liabilities:
Deferred tax liabilities 7,932 9,347
Total long-term liabilities 7,932 9,347
Total liabilities 141,283 87,420
Minority interest 28,096 2,315
Stockholders' equity:
Common stock, $0.001 par value; 100,000
shares authorized; 58,679 issued and
52,809 outstanding at January 31, 2006
and 57,634 shares issued and outstanding
at April 30, 2005, respectively 59 58
Additional paid-in capital 273,750 263,102
Accumulated other comprehensive
income (loss) 895 (25)
Treasury stock, 5,870 shares at January 31,
2006 and zero shares at April 30, 2005 (79,568) --
Retained earnings 193,578 126,963
Total stockholders' equity 388,714 390,098
Total liabilities and stockholders'
equity $558,093 $479,833
OMNIVISION TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
January 31, January 31,
2006 2005 2006 2005
Revenue $137,283 $101,833 $360,097 $285,076
Cost of goods sold 81,922 60,370 226,984 165,651
Gross profit 55,361 41,463 133,113 119,425
Operating expenses:
Research and
development 10,481 6,316 28,893 18,169
Selling, general
and administrative 9,238 7,100 25,075 21,820
Total operating
expenses 19,719 13,416 53,968 39,989
Income from operations 35,642 28,047 79,145 79,436
Interest income
(expense), net 2,292 1,190 6,345 2,749
Other income
(loss), net 1,197 44 1,256 (617)
Income before income
taxes and minority
interest 39,131 29,281 86,746 81,568
Provision for income
taxes 7,826 8,198 17,349 22,839
Minority interest 1,669 -- 2,782 --
Net income $29,636 $21,083 $66,615 $58,729
Net income per share:
Basic $0.56 $0.37 $1.22 $1.04
Diluted $0.53 $0.33 $1.18 $0.94
Shares used in computing
net income per share:
Basic 52,576 56,710 54,515 56,501
Diluted 55,547 63,457 56,643 62,556
Source: prnewswire
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