1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SEPTEMBER 30, 1995
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or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to ________.
COMMISSION FILE NUMBER: 1-5740
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DIODES INCORPORATED
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(Exact name of registrant as specified in its charter)
DELAWARE 95-2039518
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or Identification No.)
3050 EAST HILLCREST DRIVE
WESTLAKE VILLAGE, CALIFORNIA 91362
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (805) 446-4800
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
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The number of shares of the registrant's Common Stock outstanding as of
September 30, 1995, was 5,675,419 including 717,115 shares of treasury stock.
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DIODES INCORPORATED
INDEX
Page
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PART I - FINANCIAL INFORMATION
Item 1 - Consolidated Condensed Financial Statements
Consolidated Balance Sheets at September 30, 1995 and
December 31, 1994 3-4
Consolidated Statements of Income for the three months and nine
months ended September 30, 1995 and September 30, 1994 5
Consolidated Statements of Cash Flows for the nine months ended
September 30, 1995 and September 30, 1994 6
Notes to Consolidated Condensed Financial Statements 7
Item 2 - Management's Discussion and Analysis of Financial Condition and
Results of Operations for the three months and nine months ended
September 30, 1995 and September 30, 1994 8-15
PART II - OTHER INFORMATION
Items 1 through 6 16
Signature 17
Index to Exhibits 18
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PART I - FINANCIAL INFORMATION
ITEM 1 - CONSOLIDATED CONDENSED FINANCIAL INFORMATION
DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEET
ASSETS
(UNAUDITED)
SEPTEMBER 30, DECEMBER 31,
1995 1994
------------ ------------
CURRENT ASSETS
Cash $ 472,358 $ 1,733,078
Accounts receivable
Customers 9,868,559 6,020,277
Other 191,173 244,416
------------ ------------
10,059,732 6,264,693
Less allowance for doubtful receivables 203,840 169,898
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9,855,892 6,094,795
Inventories
Finished Goods 11,640,095 6,435,332
Work-in-process 260,545 158,900
Raw materials 370,278 420,694
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12,270,918 7,014,926
Deferred income taxes 815,052 815,052
Prepaid expenses and other 317,161 220,128
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TOTAL CURRENT ASSETS 23,731,381 15,877,979
PROPERTY, PLANT, AND EQUIPMENT - at cost, net 1,573,530 1,595,941
OTHER ASSETS 625,668 71,169
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TOTAL ASSETS $ 25,930,579 $ 17,545,089
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DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEET
LIABILITIES AND STOCKHOLDERS' EQUITY
(UNAUDITED)
SEPTEMBER 30, DECEMBER 31,
1995 1994
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CURRENT LIABILITIES
Notes payable $ 3,550,654 $ 0
Trade accounts payable 3,886,877 3,543,496
Accrued liabilities 2,774,677 1,710,687
Income taxes payable 942,612 1,173,209
Current portion of long term debt 39,061 40,208
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TOTAL CURRENT LIABILITIES 11,193,881 6,467,600
LONG TERM OBLIGATION, less current maturities 256,146 293,526
DEFERRED COMPENSATION PAYABLE -- 13,710
STOCKHOLDERS' EQUITY
Preferred stock - par value $1.00 per share;
1,000,000 shares authorized; 169,629
shares issued at December 31, 1994 and
September 30, 1995. -- 169,629
Common stock - par value $0.66 2/3 per share;
9,000,000 shares authorized; 5,343,124 and 5,675,419
shares issued at December 31, 1994 and September 30,
1995, respectively. 3,783,976 3,562,499
Additional paid-in capital 5,084,464 4,791,826
Retained earnings 7,394,345 4,028,532
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16,262,785 12,552,486
Less:
Treasury stock - 717,115 Common shares, at cost 1,782,233 1,782,233
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TOTAL STOCKHOLDERS' EQUITY 14,480,552 10,770,253
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 25,930,579 $ 17,545,089
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DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
--------------------------------- -------------------------------
1995 1994 1995 1994
----------- ----------- ----------- -----------
NET SALES $15,355,870 $ 9,887,311 $44,133,924 $28,112,596
Cost of goods sold 10,923,904 7,078,635 31,620,554 20,253,901
Gross profit 4,431,966 2,808,676 12,513,370 7,858,695
Selling, general and
administrative expenses 2,483,398 1,841,839 7,362,988 5,361,078
---------- ----------- ----------- -----------
Income from operations 1,948,568 966,837 5,150,382 2,497,617
Other income (expense)
Interest income 2,744 21,106 21,736 37,410
Interest expense (76,242) (7,765) (119,543) (55,170)
Commissions and other 191,277 99,011 387,030 332,483
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117,779 112,352 289,223 314,723
INCOME BEFORE INCOME TAXES 2,066,347 1,079,189 5,439,605 2,812,340
Provision for income taxes 805,272 440,630 2,073,788 1,108,310
---------- ----------- ----------- -----------
NET INCOME $1,261,075 $ 638,559 $ 3,365,817 $ 1,704,030
========== =========== =========== ===========
EARNINGS PER SHARE
PRIMARY $ 0.24 $ 0.12 $ 0.65 $ 0.33
FULLY-DILUTED $ 0.24 $ 0.12 $ 0.64 $ 0.33
========== =========== =========== ===========
Weighted average shares outstanding
Primary 5,276,127 5,123,733 5,206,042 5,134,635
Fully-diluted 5,276,127 5,123,733 5,255,624 5,134,635
========== =========== =========== ===========
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DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
NINE MONTHS ENDED
SEPTEMBER 30,
-------------------------------------
1995 1994
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CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 3,366,000 $ 1,704,000
Adjustments to reconcile net income to net cash
provided (used) by operating activities:
Depreciation and amortization 238,000 240,000
Increase in allowance for doubtful accounts 34,000 6,000
Equity in Joint Venture earnings -- (71,000)
(Gain) on sale of property, plant and equipment, net (73,000) (4,000)
(Increase) decrease in operating assets:
Accounts receivable (3,795,000) (2,035,000)
Inventories (5,256,000) 672,000
Prepaid expenses and other (652,000) 21,000
(Decrease) increase in operating liabilities:
Trade accounts payable 344,000 1,090,000
Accrued liabilities 833,000 1,220,000
Deferred compensation payable (14,000) (33,000)
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Net cash provided (used) by operations (4,975,000) 2,810,000
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment (289,000) (442,000)
Proceeds from sale of equipment 147,000 14,000
Investment in subsidiary -- 400,000
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Net cash (used) by investing activities (142,000) (28,000)
CASH FLOWS FROM FINANCING ACTIVITIES
Advances (payments) on line of credit, net 3,551,000 (2,000,000)
Proceeds from issuance of stock 344,000 162,000
Repayments of long-term obligations (39,000) (103,000)
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Net cash provided (used) by financing activities 3,856,000 (1,942,000)
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INCREASE (DECREASE) IN CASH $ (1,261,000) $ 840,000
CASH AT BEGINNING OF PERIOD $ 1,733,000 $ 802,000
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CASH AT END OF PERIOD $ 472,000 $ 1,642,000
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DIODES INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - Basis of Presentation
The accompanying unaudited consolidated, condensed financial
statements have been prepared in accordance with the instruction to Form 10-Q
and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for
a fair presentation of the financial position and results of operations have
been included. Operating results for interim periods are not necessarily
indicative of the results that may be expected for the full year. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company's annual report in Form 10-K for the calendar
year ended December 31, 1994.
NOTE B - Income Taxes
Effective January 1, 1993, the Company adopted Financial
Accounting Standards Board's Statement of Financial Accounting Standards No.
109, "Accounting for Income Taxes." This pronouncement requires that taxes be
provided based upon the tax rate at which the items of income and expense are
expected to be settled in the Company's tax return.
SFAS No. 109 requires the recognition of deferred tax assets
and liabilities for both the expected future tax impact of differences between
the financial statement and tax basis of assets and liabilities, and for the
expected future tax benefit to be derived from tax loss carryforwards. SFAS
No. 109 additionally requires the establishment of a valuation allowance to
reflect the likelihood of realization of deferred tax assets.
Accordingly, the Company has recorded a net deferred tax asset
resulting from net deductible temporary differences in the amount of $815,052.
This deferred tax asset results primarily from inventory reserves and expense
accruals which are not currently deductible for federal income tax purposes.
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PART I - FINANCIAL INFORMATION
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FINANCIAL CONDITION
Net sales for the three months and nine months ended September
30, 1995 were, respectively, $15.4 million, a 55.3% increase, and $44.1
million, a 57.0% increase over the comparable periods in 1994. These increases
can be attributed in large part to continued strong industry demand for
discrete semiconductors as well as the Company's concerted marketing program -
in particular, its pursuit of both medium-sized OEMs and larger strategic
accounts that especially value the Company's broad product line, its technical
expertise, and its ability to meet diverse customer requirements. Also
important in the growth of net sales was the introduction of a new product
offering of small signal transistors in late 1994, and the Company's ongoing
program to build customer loyalty through superior customer service. Essential
to the Company's recent growth has been the ability to procure ever increasing
numbers of high-quality components at competitive prices; in addition to
working closely with its existing suppliers, the Company has continued its
program of aggressively seeking new sourcing opportunities.
Gross margins for the three months and nine months ended
September 30, 1995 were, respectively, 28.9% and 28.4%, versus 28.4% and 28.0%
in the comparable periods in 1994. This improvement in margins is reflective
of the continued rise in demand for the Company's products. In addition,
selling, general and administrative expenses ("SG&A") decreased as a percentage
of net sales from 18.6% to 16.2% for the comparable three month period and from
19.1% to 16.7% for the comparable nine month period. When compared to the
respective three month and nine month periods ended September 30, 1994,
respectively; (i) income from operations in 1995 increased 101.5% and 106.2%;
(ii) other income increased 4.8% and decreased 8.1%; (iii) pre-tax income
increased 91.5% and 93.4%; and (iv) net income increased 97.5% and 97.5%. The
Company maintained adequate working capital to support its continued growth in
net sales.
In July 1995, the Company's major shareholder, Lite On Power
Semiconductor Corporation ("LPSC"), converted its 169,629 shares of Class A
Convertible Preferred Stock to common stock on a one share to one share basis.
Reliance on Foreign Sources. For the past several years,
nearly all of the Company's net sales (like those of most other companies in
the industry) have been derived from products purchased from overseas suppliers
or from U.S. companies whose products are manufactured overseas. The Company
anticipates that this dependence on foreign sources of its products will
continue for the foreseeable future.
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Foreign sourcing exposes the Company to certain risks common
to companies doing business overseas: these risks include the difficulty and
expense of maintaining foreign sourcing channels, cultural and institutional
barriers to trade, fluctuations in currency exchange rates, political
instability, transportation delays, expropriation, tariffs, import and export
controls (including export licenses and changes in the allocation of quotas),
and other U.S. and foreign regulations that may apply to the export and import
of the Company's products, and which could have a material adverse effect on
the Company. The Company attempts to reduce the risk of doing business in
foreign countries by, among other things, contracting in U.S. dollars, and,
when possible, maintaining multiple sourcing of product groups from several
countries.
Volatility of Demand, Availability of Parts and Relationship
with Suppliers. The main consumers of discrete semiconductor parts are the
computer, subassembly, telecommunication, and consumer electronic industries,
which are characterized by volatile customer demand. In recent years,
competition within these industries, rapid technological advances, frequent
introduction of new products and product enhancements (including smaller and
more portable electronic products), and high consumer demand have been
principally responsible for a significant increase in the demand of discrete
semiconductor parts. As a result, there has been and continues to be
significant competition for the world wide availability of discrete
semiconductor parts.
The Company attempts to meet the volatility of demand for
discrete semiconductor parts by (i) aggressively identifying new sources of
products, (ii) forming joint ventures and alliances with manufacturers and
distributors, and (iii) having a geographically diverse mix of manufacturers
and suppliers, located in Taiwan, China, Germany, Japan, France, the
Philippines, India, Thailand and the United States. Within the last two years,
the Company has observed that the demand for semiconductor parts has been
stronger than the supply and, therefore, has had to decline some orders because
of the limited availability of these products.
The Company purchases products from over 20 suppliers. Among
the Company's major suppliers are ITT, LPSC, and Shen Jiang Corporation. For
the first nine months of 1995, products purchased from these suppliers
accounted for approximately 41.7%, 15.3%, and 5.3%, respectively, of the
Company's net sales.
The Company has several supply agreements, some short-term,
others long-term, but believes that its success depends, in large part, on
developing long-term relationships with current suppliers, as well as on
developing new relationships with suppliers for its existing and future product
lines. Further, although the Company believes that there exist alternative
sources for the products of any of its suppliers, the loss of any one of its
principal suppliers or the loss of several suppliers in a short period of time
could have a materially adverse effect on the Company.
In September 1995, the Company became aware that ITT
Corporation had reached a preliminary agreement with Telefunken Microelectronic
GmbH ("Temic", a subsidiary of Daimler-Benz Corporation) regarding the sale of
ITT's semiconductor operation ("ITT Semiconductors"). It was further
understood that the transaction is subject to the execution of a definitive
agreement,
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government approvals, and approval of the respective boards of directors.
Spokesmen for ITT and Temic indicated that the transaction will involve no
significant changes to either organization, and that all customer commitments
will continue to be honored. In any event, the Company will continue its
efforts to aggressively search for new sourcing opportunities to reduce
reliance on a limited number of suppliers and to support growing customer
demand.
The following discussion explains in greater detail the
consolidated operating results and financial condition of the Company. This
discussion should be read in conjunction with the consolidated financial
statements and notes thereto appearing elsewhere in this quarterly report.
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
1995 1994
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Net Sales $ 15,355,870 $ 9,887,311
The Company's 1995 comparative increase in net sales of
approximately $5.5 million, or 55.3%, was primarily a result of a continued
strong industry demand for discrete semiconductors as well as the Company's
concerted marketing program to pursue both medium-sized OEMs and larger
strategic accounts that especially value the Company's broad product line, its
technical expertise, and its ability to meet diverse customer requirements.
1995 1994
---- ----
Gross Profit $ 4,431,966 $ 2,808,676
Gross Margin Percentage 28.9% 28.4%
The Company's gross profit for the three months ended
September 30, 1995, increased approximately $1.6 million or 57.8%, primarily
due to the 55.3% increase in net sales. The gross margin percentage increased
1.8%, resulting from increased product demand and improvements in service to
the Company's customers.
1995 1994
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SG&A $ 2,483,398 $ 1,841,839
The Company's SG&A for the three months ended September 30,
1995, increased approximately 34.8%, while net sales increased 55.3% compared
to the same period last year. This $642,000 increase was primarily attributable
to increased commissions paid to outside sales representatives and
distributors, and an increase in overall wages and benefits. The total SG&A as
a percentage of net sales actually decreased from 18.6% in 1994 to 16.2% in
1995, a 14.8% decrease.
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1995 1994
---- ----
Income from Operations $ 1,948,568 $ 966,837
The Company's fiscal 1995 comparative increase in operating
profit of approximately $982,000, or 101.5%, is primarily the net result of the
Company's significant increase in net sales and gross profit, as well as
continued efforts to control SG&A, which resulted in a decrease in SG&A as a
percentage of net sales.
1995 1994
---- ----
Interest Income $ 2,744 $ 21,106
Interest Expense $ 76,242 $ 7,765
The Company's interest income for the three months ended
September 30, 1995, decreased 87.0% compared to the same period last year as
the Company maintained adequate working cash.
The Company's interest expense for the three months ended
September 30, 1995 increased approximately $68,000, primarily as a result of an
increase in the Company's usage of its revolving line of credit to
approximately $3.6 million, primarily for increased inventory to support
increased sales.
1995 1994
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Commissions and Other Income $ 191,277 $ 99,011
The Company's other income for the three months ended
September 30, 1995, increased approximately $92,000, or 93.2% compared to
commissions and other income for the same period in 1994. This increase in
commissions and other income is primarily attributed to increased sales
commissions received.
1995 1994
---- ----
Pre-tax Income $ 2,066,347 $ 1,079,189
The Company's pre-tax income for the three months ended
September 30, 1995, increased approximately $987,000 or 91.5%, primarily due to
the 55.3% increase in net sales, combined with a 14.8% decrease in SG&A as a
percentage of net sales.
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1995 1994
---- ----
Provision for income taxes $ 805,272 $ 440,630
The Company's provision for income taxes for the three months
ended September 30, 1995, amounts to 39.0% of income before taxes, as compared
to 40.8% for the three months ended September 30, 1994. The provision includes
an estimate of income tax in the United States, Taiwan, and California.
1995 1994
---- ----
Net Income $ 1,261,075 $ 638,559
Primary Earnings Per Share $ 0.24 $ 0.12
The Company's net income for the three months ended September
30, 1995, increased 97.5% or approximately $623,000 compared to the same period
in 1994. Both primary and fully-diluted earnings per share increased 100% for
the three months ended September 30, 1995, compared to the three months ended
September 30, 1994. Increases in both net income and primary and fully-diluted
earnings per share are primarily attributable to a 55.3% increase in net sales,
and a 1.8% increase in gross margin, combined with an 14.8% decrease in SG&A as
a percentage of net sales.
RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994.
1995 1994
---- ----
Net Sales $ 44,133,924 $ 28,112,596
The Company's 1995 comparative increase in net sales of
approximately $5.5 million, or 55.3%, was primarily a result of a continued
strong industry demand for discrete semiconductors as well as the Company's
concerted marketing program to pursue both medium-sized OEMs and larger
strategic accounts that especially value the Company's broad product line, its
technical expertise, and its ability to meet diverse customer requirements.
1995 1994
---- ----
Gross Profit $ 12,513,370 $ 7,858,695
Gross Margin Percentage 28.4% 28.0%
The Company's gross profit for the nine months ended September
30, 1995, increased approximately $4.7 million or 59.2%, primarily due to the
57.0% increase in net sales. The gross margin percentage increased 1.4%,
resulting from increased product demand and improvements in service to its
customers.
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1995 1994
---- ----
SG&A $ 7,362,988 $ 5,361,078
The Company's SG&A for the nine months ended September 30,
1995, increased approximately 37.3%, while net sales increased 57.0% compared
to the same period last year. This $2.0 million increase was primarily
attributable to increased commissions paid to outside sales representatives and
distributors, and an increase in overall wages and benefits. The total SG&A as
a percentage of net sales actually decreased from 19.1% in 1994 to 16.7% in
1995, a 14.4% decrease.
1995 1994
---- ----
Income from Operations $ 5,150,382 $ 2,497,617
The Company's fiscal 1995 comparative increase in operating
profit of approximately $2.7 million, or 106.2%, is primarily the net result of
the Company's significant increase in net sales and gross profit, as well as
continued efforts to control SG&A, which resulted in a decrease in SG&A as a
percentage of net sales.
1995 1994
---- ----
Interest Income $ 21,736 $ 37,410
Interest Expense $ 119,543 $ 55,170
The Company's interest income for the nine months ended
September 30, 1995, decreased 41.9% compared to the same period last year as
the Company maintained adequate working cash.
The Company's interest expense for the nine months ended
September 30, 1995 increased approximately $64,000 or 116.7%, primarily as a
result of an increase in the Company's usage of its revolving line of credit to
approximately $3.6 million, primarily for increased inventory to support
increased sales.
1995 1994
---- ----
Commissions and Other Income $ 387,030 $ 332,483
The Company's commissions and other income for the nine months
ended September 30, 1995, increased approximately $54,500, or 16.4% compared to
other income for the same period in 1994. This increase in other income is
primarily attributed to increased commissions received.
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1995 1994
---- ----
Pre-tax Income $ 5,439,605 $ 2,812,340
The Company's pre-tax income for the nine months ended
September 30, 1995, increased approximately $2.6 million or 93.4%, primarily
due to the 57.0% increase in net sales, combined with a 14.4% decrease in SG&A
as a percentage of net sales.
1995 1994
---- ----
Provision for income taxes $ 2,073,788 $ 1,108,310
The Company's provision for income taxes for the nine months
ended September 30, 1995, amounts to 38.1% of income before taxes, as compared
to 39.4% for the nine months ended September 30, 1994. The provision includes
an estimate of income tax in the United States, Taiwan, and California.
1995 1994
---- ----
Net Income $ 3,365,817 $ 1,704,030
Primary Earnings Per Share $ 0.65 $ 0.33
The Company's net income for the nine months ended September
30, 1995, increased 97.5% or approximately $1.7 million compared to the same
period in 1994. Primary earnings per share increased 97.0% for the nine months
ended September 30, 1995, compared to the nine months ended September 30, 1994,
and fully-diluted earnings per share increased 93.9% for the nine months ended
September 30, 1995, compared to the nine months ended September 30, 1994.
Increases in both net income and primary and fully-diluted earnings per share
are primarily attributable to a 57.0% increase in net sales, and a 1.4%
increase in gross margin, combined with a 14.4% decrease in SG&A as a
percentage of net sales.
LIQUIDITY AND CAPITAL RESOURCES
The ratio of the Company's current assets to current
liabilities on September 30, 1995, was 2.12 to 1 compared to a ratio of 2.46 to
1 as of December 31, 1994. The Company anticipates it will continue to utilize
its line of credit to support continued growth. In August 1995, the Company
temporarily increased its line of credit to $6.0 million while negotiating a
new credit agreement and term commitment loan. See "Item 6. Exhibits and
Reports on Form 8-K." On November 1, 1995 the Company entered into a new line
of credit agreement for $10.0 million expiring November 1, 1996. The Company
also established a term commitment loan for $4.0 million, expiring November 1,
2001. This increased credit facility will be used to provide financing for
additional sourcing through various financing arrangements. See "Item 6.
Exhibits and Reports on Form 8-K." As of September 30, 1995 the Company has
utilized approximately $3.6 million of its line of credit and the Company has
yet to utilize the term loan.
The Company believes that the availability of this credit line,
together with internally generated funds, will be sufficient to meet the
Company's currently foreseeable operating cash
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requirements. The Company believes that its working capital will be sufficient
for anticipated growth; however, the Company continues to evaluate its cash
position and may seek to increase its line of credit to support inventory and
future sales growth. The Company's total working capital increased to $12.5
million as of September 30, 1995, from $9.4 million as of December 31, 1994,
primarily as a result of the 57.0% increase in net sales and related positive
cash flow in 1995. Notes payable increased to $3.6 million to fund a 80.9%
increase in inventories, supporting the 57.0% increase in net sales. Accounts
receivable also increased 61.7%, primarily as a result of the net sales
increase.
To ensure that the Company can secure reliable and cost
effective sourcing to support and better position itself for growth, the
Company is continuously evaluating additional sources of products. The Company
believes its financial position will provide sufficient funds should an
appropriate investment opportunity arise. This will also help the Company
improve customer satisfaction and increase product market penetration. The
Company's debt to equity ratio increased to 0.79 at September 30, 1995, from
0.63 at December 31, 1994. The Company anticipates this ratio may increase as
the Company continues to use its line of credit to support forecasted sales
growth.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
There are no matters to be reported under this heading.
ITEM 2. CHANGES IN SECURITIES
There are no matters to be reported under this heading.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
There are no matters to be reported under this heading.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There are no matters to be reported under this heading.
ITEM 5. OTHER INFORMATION
There are no matters to be reported under this heading.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 10.11 - $6.0 Million Revolving Line of Credit Note
Exhibit 10.12 - Credit Agreement between Wells Fargo Bank
and the Company dated November 1, 1995
Exhibit 11 - Computation of Earnings Per Share for the
for the three months and nine months ended
September 30, 1995 and September 30, 1994
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
None
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
DIODES INCORPORATED (Registrant)
/s/ Joseph Liu November 7, 1995
JOSEPH LIU
Vice President, Secretary
and Chief Financial Officer
(Principal Financial and Accounting Officer)
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INDEX TO EXHIBITS
Exhibit 10.11 - $6.0 Million Revolving Line of Credit Note Page 19
Exhibit 10.12 - Credit Agreement between Wells Fargo Bank
and the Company dated November 1, 1995 Page 25
Exhibit 11 - Computation of Earnings Per Share for the
for the three months and nine months ended
September 30, 1995 and September 30, 1994 Page 59
Exhibit 27 - Financial Data Schedule Page 60
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