EXHIBIT 99.1
Alpha and Omega Semiconductor Reports Financial Results for the Second Quarter of Fiscal 2012 Ended December 31, 2011
SUNNYVALE, Calif., Jan. 25, 2012 (GLOBE NEWSWIRE) -- Alpha and Omega Semiconductor Limited ("AOS") (Nasdaq:AOSL), a designer, developer and global supplier of a broad range of power semiconductors, today reported financial results that are prepared in accordance with U.S. Generally Accepted Accounting Principles ("U.S. GAAP") for the second quarter of fiscal 2012 ended December 31, 2011.
The results for the second quarter of fiscal 2012 ended December 31, 2011 are as follows:
- Revenue was $80.7 million, a sequential decrease of 3.3% from $83.4 million for the prior quarter, and a decrease of 3.9% from $84.0 million for the same quarter in the prior fiscal year.
- Gross margin was 22.6%, compared to 24.7% for the prior quarter and 27.6% for the same quarter in the prior fiscal year.
- Operating expenses were $15.9 million, compared to $17.7 million for the prior quarter and $15.6 million for the same quarter in the prior fiscal year.
- Non-GAAP operating expenses were $14.6 million, compared to $16.1 million for the prior quarter and $14.6 million for the same quarter in the prior fiscal year. Non-GAAP operating expenses excluded share-based compensation expense of $1.3 million, $1.1 million and $1.1 million for this quarter, the prior quarter and the same quarter in the prior fiscal year, respectively. In addition, non-GAAP operating expenses excluded U.S. GAAP conversion costs of $0.4 million for the prior quarter.
- Operating income was $2.3 million, compared to $2.9 million for the prior quarter and $7.5 million for the same quarter in the prior fiscal year.
- Non-GAAP operating income was $3.8 million, compared to $4.6 million for the prior quarter and $8.8 million for the same quarter in the prior fiscal year. Non-GAAP operating income excluded share-based compensation expense of $1.5 million, $1.2 million and $1.2 million for this quarter, the prior quarter and the same quarter in the prior fiscal year, respectively. In addition, non-GAAP operating income excluded U.S. GAAP conversion costs of $0.4 million for the prior quarter.
- Net income was $1.5 million, or $0.06 per diluted share, compared to $2.1 million, or $0.08 per diluted share, for the prior quarter and $8.7 million, or $0.36 per diluted share, for the same quarter in the prior fiscal year.
- Non-GAAP net income, excluding share-based compensation expense and U.S. GAAP conversion costs, was $2.9 million, or $0.12 per diluted share, compared to $3.8 million, or $0.15 per diluted share, for the prior quarter and $9.9 million, or $0.41 per diluted share, for the same quarter in the prior fiscal year.
Reconciliation of non-GAAP financial measures to the U.S. GAAP amounts are set forth in the attached schedules.
"We were able to maintain and in some cases slightly increased our market share during the quarter, although our margin was pressured by average selling price erosion due to continued softness in the macro economy. We were able to achieve higher than projected earnings through reduction of our operating expenses," said Dr. Mike Chang, Chief Executive Officer and Chairman of AOS. "We further reduced our internal inventory level during the quarter; in addition, our channel inventory also decreased as sell-through from our distributors exceeded ship-in revenue. In recent weeks, we have observed solid improvement in our booking pattern."
Dr. Chang continued, "I am glad to report the achievement of several milestones in the execution of our strategic roadmap. During the quarter, we secured an Approved Vendor List (AVL) position at a large globally branded smartphone manufacturer. While only very modest revenue is expected in the near term, this opens the door for us to access the large and growing smartphone market. For the high-voltage product line, we expect to commence small volume production shipment of our leading edge high-voltage IGBT products to a major global industrial company under a supply contract. For the mid-voltage product line, we have gained additional design wins in the telecommunication market. We remain sharply focused on executing our strategic roadmap to achieve broader diversification. We believe that our gross margin will improve progressively as our product mix shifts in concert with our diversification efforts."
"As we look forward, we are on target to close the previously announced acquisition of the IDT fabrication facility this month, and we expect a smooth production ramp after the closing. In summary, we believe that we are well positioned for future growth and margin expansion."
Fiscal Q3, 2012 Business Outlook
The following statements are based upon management's current expectations. These statements are forward-looking, and actual results may differ materially. AOS undertakes no obligation to update these statements.
Recent booking activities have stabilized with book to bill ratio solidly above one; therefore, we expect our March quarter revenue to be flat to up 4%. The projected product mix is expected to improve margin slightly, offset by the negative impact from the initial ramp up of the newly acquired IDT fab of 300 to 350 basis points, as compared to the 500 basis points impact we discussed during previous earnings calls. This improved outlook is because we expect a smoother transition at that facility than originally anticipated, and we have successfully installed a majority of our fabrication processes there.
- Revenue is expected to be between $80 million and $84 million.
- Gross margin is expected to be in the range of 20% to 21%, including the negative impact arising from the initial ramp at the acquired fab facility.
- Operating expenses are expected to be flat with the prior quarter.
- Operating income is expected to be in the range of breakeven to 1.5%.
- Non-GAAP operating income is expected to be in the range of 1.8% to 3.3%, excluding estimated $1.5 million share-based compensation expense.
- Net income/loss is expected to be in the range of -1.0% to 0.5%, including an expected tax provision of approximately $800K.
- Non-GAAP net income is expected to be in the range of 0.8% to 2.3%, excluding estimated $1.5 million share-based compensation expense.
Conference Call and Webcast
AOS plans to conduct an investor teleconference and live webcast to discuss the financial results for the second quarter of fiscal 2012 today, January 25, 2012 at 2:00 p.m. PDT / 5:00 p.m. EDT. To participate in the live call, analysts and investors should dial 877-312-8797 (or 253-237-1194 if outside the U.S.). To access the live webcast and the subsequent replay of the conference call, which will be available for seven days after the live call, go to the "Events & Presentations" section of the company's investor relations website, http://investor.aosmd.com.
Forward Looking Statements
This press release contains forward-looking statements that are based on current expectations, estimates, forecasts and projections of future performance based on management's judgment, beliefs, current trends, and anticipated product performance. These forward looking statements include, without limitation, projected amount of revenues, gross margin, product mix and operating income, expectation with respect to the macroeconomic conditions, booking patterns, product design wins and our long-term strategy and revenue growth, expansion into new markets, including the smartphone market, expectation with respect to the IDT acquisition and other information under the section entitled "Business Outlook". Forward looking statements involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These factors include, but are not limited to, our ability to introduce or develop new and enhanced products that achieve market acceptance; the actual product performance in volume production; the quality and reliability of our product, our ability to achieve design wins, the general business and economic conditions, our ability to identify and consummate strategic transactions; the state of semiconductor industry and seasonality of our markets, and other risks as described in our SEC filings. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Although we believe that the expectations reflected in the forward looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements. You should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today's date, unless otherwise stated, and AOS undertakes no duty to update such information, except as required under applicable law.
Use of Non-GAAP Financial Measures
To supplement our unaudited consolidated financial statements presented on a basis consistent with the U.S. GAAP, we disclose certain non-GAAP financial measures, including non-GAAP operating expenses, operating income, projected operating income, net income and earnings per share. These supplemental measures exclude share-based compensation expenses that are non-cash charges and costs incurred for our U.S. GAAP conversion. We believe that non-GAAP financial measures can provide useful information to both management and investors by excluding certain non-cash and non-recurring expenses that are not indicative of our core operating results. In addition, our management uses non-GAAP measures to compare our performance relative to forecasts and to benchmark our performance externally against competitors. Our use of non-GAAP financial measures has certain limitations in that the non-GAAP financial measures we use may not be directly comparable to those reported by other companies. For example, the term used in this press release, non-GAAP net income, does not have a standardized meaning. Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of our performance in relation to other companies. We seek to compensate for this limitation by providing a detailed reconciliation of the non-GAAP financial measures to the most directly comparable U.S. GAAP measures in the tables attached to this press release. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures.
About Alpha and Omega Semiconductor
Alpha and Omega Semiconductor Limited, or AOS, is a designer, developer and global supplier of a broad range of power semiconductors, including a wide portfolio of Power MOSFET and Power IC products. AOS seeks to differentiate itself by integrating its expertise in device physics, process technology, design and advanced packaging to optimize product performance and cost, and its product portfolio is designed to meet the ever increasing power efficiency requirements in high volume applications, including portable computers, smart phones, flat panel TVs, battery packs, portable media players, UPS, motor control and power supplies. For more information, please visit http://www.aosmd.com. For investor relations, please contact So-Yeon Jeong at investors@aosmd.com.
The following consolidated financial statements are prepared in accordance with U.S. GAAP.
| |
| Alpha and Omega Semiconductor Limited |
| Condensed Consolidated Balance Sheets |
| U.S. GAAP |
| (in thousands, except for par value per share) | | |
| (unaudited) | | |
| | | |
| | December 31, 2011 | June 30, 2011 |
| ASSETS | | |
| Current assets: | | |
| Cash and cash equivalents | $ 97,260 | $ 86,708 |
| Restricted cash | 79 | 54 |
| Accounts receivable, net | 34,805 | 42,503 |
| Inventories | 46,135 | 65,251 |
| Deferred tax assets | 1,824 | 1,773 |
| Other current assets | 2,197 | 5,056 |
| Total current assets | 182,300 | 201,345 |
| Property and equipment, net | 131,080 | 127,839 |
| Intangible assets, net | 1,314 | 1,599 |
| Deferred tax assets | 8,866 | 9,048 |
| Other long-term assets | 8,169 | 7,607 |
| Total assets | $ 331,729 | $ 347,438 |
| | | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | | |
| Current liabilities: | | |
| Bank borrowings | $ 10,700 | $ -- |
| Accounts payable | 35,299 | 64,678 |
| Accrued liabilities | 13,496 | 15,123 |
| Income taxes payable | 1,543 | 2,377 |
| Deferred margin | 340 | 495 |
| Capital leases - current portion | 14 | 306 |
| Total current liabilities | 61,392 | 82,979 |
| Income taxes payable - long term | 3,154 | 3,081 |
| Deferred income tax liabilities | 24 | 25 |
| Capital leases - long term portion | 130 | 130 |
| Deferred rent | 1,109 | 973 |
| Total liabilities | 65,809 | 87,188 |
| | | |
| Shareholders' equity: | | |
| Preferred shares, par value $0.002 per share: | | |
| | | |
| Authorized: 10,000 shares; Issued and outstanding: none at December 31, 2011 and June 30, 2011 | -- | -- |
| Common shares, par value $0.002 per share: | | |
| Authorized: 50,000 shares; Issued and outstanding: 24,828 shares and 24,587 shares at December 31, 2011 and 24,612 shares and 24,562 shares at June 30, 2011 | 49 | 49 |
| Treasury shares at cost; 241 shares at December 31, 2011 and 50 shares at June 30, 2011 | (2,267) | (693) |
| Additional paid-in capital | 156,610 | 153,004 |
| Accumulated other comprehensive income | 959 | 934 |
| Retained earnings | 110,569 | 106,956 |
| Total shareholders' equity | 265,920 | 260,250 |
| Total liabilities and shareholders' equity | $ 331,729 | $ 347,438 |
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| | | | | | |
| Alpha and Omega Semiconductor Limited | | | | | |
| Condensed Consolidated Statements of Income | | | | |
| U.S. GAAP | | | | | |
| (in thousands, except per share amounts) | | | | | |
| (unaudited) | | | | | |
| | | | | | |
| | Three Months Ended | Six Months Ended |
| | December 31, 2011 | September 30, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 |
| | | | | | |
| Revenue | $ 80,713 | $ 83,448 | $ 83,982 | $ 164,161 | $ 173,399 |
| Cost of goods sold | 62,440 | 62,871 | 60,786 | 125,311 | 126,058 |
| Gross profit | 18,273 | 20,577 | 23,196 | 38,850 | 47,341 |
| Gross margin | 22.6 % | 24.7 % | 27.6 % | 23.7 % | 27.3 % |
| | | | | | |
| Operating expenses: | | | | | |
| Research and development | 8,108 | 8,394 | 6,609 | 16,502 | 12,868 |
| Selling, general and administrative | 7,833 | 9,283 | 9,040 | 17,116 | 18,238 |
| Total operating expenses | 15,941 | 17,677 | 15,649 | 33,618 | 31,106 |
| Operating income | 2,332 | 2,900 | 7,547 | 5,232 | 16,235 |
| | | | | | |
| Interest income | 25 | 39 | 53 | 64 | 81 |
| Interest expense | (44) | (27) | (63) | (71) | (109) |
| Income on equity investment in APM | -- | -- | 882 | -- | 1,768 |
| Gain on equity interest in APM | -- | -- | 836 | -- | 836 |
| Income before income taxes | 2,313 | 2,912 | 9,255 | 5,225 | 18,811 |
| | | | | | |
| Income tax expense | 839 | 773 | 564 | 1,612 | 1,320 |
| Net income | $ 1,474 | $ 2,139 | $ 8,691 | $ 3,613 | $ 17,491 |
| | | | | | |
| | | | | | |
| Net income per share | | | | | |
| Basic per share | $ 0.06 | $ 0.09 | $ 0.38 | $ 0.15 | $ 0.78 |
| Diluted per share | $ 0.06 | $ 0.08 | $ 0.36 | $ 0.14 | $ 0.73 |
| | | | | | |
| Weighted-average number of shares used in computing net income per share | | | | | |
| | | | | | |
| Basic shares | 24,538 | 24,472 | 22,977 | 24,529 | 22,546 |
| Diluted shares | 25,423 | 25,495 | 24,437 | 25,517 | 24,049 |
| |
| |
| Alpha and Omega Semiconductor Limited |
| Reconciliation of Operating Expenses to non-GAAP Operating Expenses | | | | | |
| (in thousands) | | | | | |
| (unaudited) | | | | | |
| | Three Months Ended | Six Months Ended |
| | December 31, 2011 | September 30, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 |
| | | | | | |
| U.S. GAAP operating expenses | $ 15,941 | $ 17,677 | $ 15,649 | $ 33,618 | $ 31,106 |
| | | | | | |
| Share-based compensation included in | | | | | |
| Operating expenses: | | | | | |
| Research and development | 372 | 259 | 331 | 631 | 718 |
| Selling, general and administrative | 948 | 882 | 734 | 1,830 | 1,758 |
| | 1,320 | 1,141 | 1,065 | 2,461 | 2,476 |
| | | | | | |
| U.S. GAAP conversion costs included in | | | | | |
| Selling, general and administrative | -- | 435 | -- | 435 | -- |
| | | | | | |
| Non-GAAP operating expenses | $ 14,621 | $ 16,101 | $ 14,584 | $ 30,722 | $ 28,630 |
| |
| |
| Alpha and Omega Semiconductor Limited |
| Reconciliation of Operating Income to non-GAAP Operating Income | | | | | |
| (in thousands) | | | | | |
| (unaudited) | | | | | |
| | Three Months Ended | Six Months Ended |
| | December 31, 2011 | September 30, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 |
| | | | | | |
| U.S. GAAP operating income | $ 2,332 | $ 2,900 | $ 7,547 | $ 5,232 | $ 16,235 |
| | | | | | |
| Share-based compensation: | | | | | |
| Cost of goods sold | 133 | 81 | 159 | 214 | 296 |
| Research and development | 372 | 259 | 331 | 631 | 718 |
| Selling, general and administrative | 948 | 882 | 734 | 1,830 | 1,758 |
| Total share-based compensation | 1,453 | 1,222 | 1,224 | 2,675 | 2,772 |
| | | | | | |
| U.S. GAAP conversion costs included in | | | | | |
| Selling, general and administrative | -- | 435 | -- | 435 | -- |
| | | | | | |
| Non-GAAP operating income | $ 3,785 | $ 4,557 | $ 8,771 | $ 8,342 | $ 19,007 |
| | | | | | |
| | | | | | |
| Alpha and Omega Semiconductor Limited | | | | | |
| Reconciliation of Net Income to non-GAAP Net Income | | | | |
| (in thousands, except per share amounts) | | | | | |
| (unaudited) | | | | | |
| | Three Months Ended | Six Months Ended |
| | December 31, 2011 | September 30, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 |
| | | | | | |
| U.S. GAAP net income | $ 1,474 | $ 2,139 | $ 8,691 | $ 3,613 | $ 17,491 |
| | | | | | |
| Share-based compensation: | | | | | |
| Cost of goods sold | 133 | 81 | 159 | 214 | 296 |
| Research and development | 372 | 259 | 331 | 631 | 718 |
| Selling, general and administrative | 948 | 882 | 734 | 1,830 | 1,758 |
| Total share-based compensation | 1,453 | 1,222 | 1,224 | 2,675 | 2,772 |
| | | | | | |
| U.S. GAAP conversion costs included in | | | | | |
| Selling, general and administrative | -- | 435 | -- | 435 | -- |
| | | | | | |
| Non-GAAP net income | $ 2,927 | $ 3,796 | $ 9,915 | $ 6,723 | $ 20,263 |
| | | | | | |
| Non-GAAP diluted EPS | $ 0.12 | $ 0.15 | $ 0.41 | $ 0.26 | $ 0.84 |
| | | | | | |
| Weighted-average number of shares used in computing non-GAAP earnings per share | | | | | |
| Diluted shares | 25,423 | 25,495 | 24,437 | 25,517 | 24,049 |
CONTACT: Investor Relations
So-Yeon Jeong
investors@aosmd.com