RDA Microelectronics Announces Fourth Quarter and Full Year 2012 Financial Results

RDA Microelectronics Announces Fourth Quarter and Full Year 2012 Financial
Results

Fourth Quarter Revenue Grew 40.4% and Full Year Revenue Grew 35.5%
Year-Over-Year; Fourth Quarter Gross Margin Improved to 31.7%

SHANGHAI, China, Feb. 7, 2013 (GLOBE NEWSWIRE) -- RDA Microelectronics
(Nasdaq:RDA) ("RDA Microelectronics" or the "Company"), a fabless
semiconductor company that designs, develops and markets wireless SoC and
Radio Frequency (RF) semiconductors for cellular, connectivity and broadcast
applications, today announced its financial results for the fourth quarter and
full year ended December 31, 2012.

Fiscal Year 2012 Financial Highlights (in US dollars):

  *Revenue was $391.3 million, increasing 35.5% from the $288.9 million in
    the previous year.
  *Gross margin was 32.2% compared to 34.5% in 2011.
  *Cash generated from operations was $59.1 million, compared to $63.2
    million in the previous year.
  *GAAP net income was $52.9 million, or $1.12 per diluted ADS, compared to
    $51.6 million, or $1.11 per diluted ADS, in 2011.
  *Non-GAAP net income was $63.4 million, or $1.34 per diluted ADS, compared
    to $55.5 million, or $1.19 per diluted ADS in the previous year.
  *The Company paid a special dividend of $0.20 per ordinary share, or $1.20
    per ADS, returning $55.6 million of capital to shareholders.

Fourth Quarter Financial Highlights (in US dollars):

  *Revenue was $115.6 million, exceeding the Company's guidance of $100
    million to $110 million, and representing an increase of 5.8% from the
    $109.3 million in the previous quarter and 40.4% from the $82.4 million in
    the fourth quarter of 2011.
  *Gross margin was 31.7%, compared to 31.1% in the previous quarter and
    35.3% in the fourth quarter of 2011.
  *GAAP net income was $13.4 million, or $0.28 per diluted ADS, compared to
    $13.5 million, or $0.28 per diluted ADS, in the previous quarter and $16.6
    million, or $0.37 per diluted ADS, in the fourth quarter of 2011.
  *Non-GAAP net income was $16.4 million, or $0.34 per diluted ADS, compared
    to $16.7 million, or $0.35 per diluted ADS, in the previous quarter and
    $17.4 million, or $0.39 per diluted ADS, in the fourth quarter of 2011.

For a reconciliation of non-GAAP financial measures, please refer to the
tables included in this press release.

Fourth Quarter and Recent Business Highlights:

  *Surpassed 15 million baseband units shipped per month beginning in
    November 2012.
  *The single chip RDA8851 exceeded 50% of total baseband shipments in the
    quarter.
  *Launched high band WCDMA PA products for band 1 (2100 MHz) and band 2
    (1900 MHz) applications to complete the Company's 3G WCDMA PA offering for
    emerging markets.

Commenting on the results, Vincent Tai, chairman and CEO of RDA
Microelectronics, said, "Full year 2012 revenue grew 36 percent over 2011,
reflecting strong customer adoption of our baseband solutions combined with
market share gains for our GSM PAs as well as ramping of our products
targeting the 3G and smartphone markets. Our baseband shipments increased
significantly in the fourth quarter, exceeding 15 million units per month
beginning in November from a run rate of 10 million units per month achieved
in August. This rapid ramping of shipments is due to our market share gains
for sub-$10 feature phones in emerging markets outside of China. As a result,
we exceeded our guidance during the quarter. Additionally, shipments of our
high value RDA8851 baseband SoC reached crossover by exceeding more than 50%
of our total baseband shipments. I believe we can continue to gain market
share in the high volume ultra-low cost feature phone market in 2013 as we
further penetrate local tier-one manufacturers."

Mr. Tai further commented, "Our continued progress and execution within the
GSM baseband market also allows us to leverage this success in the smartphone
market with the same customer base and platforms. We have begun penetrating
this segment of the market with new products, like our WiFi combo chip, and
anticipate gaining additional traction with our EDGE baseband and multi-mode
PAs that are expected to begin sampling in early 2013. These products target
established, high volume markets where RDA has a strong local position and
differentiated solutions that offer customers exceptional performance and
integration at a low cost. We anticipate that many of our RDA8851 baseband
customers will be early adopters of these future products.

"Looking forward, we continue to focus on delivering strong profitability,
cash flow and margin improvement, while investing in product development to
drive our future growth in the smartphone, 3G, 4G and TV markets. Our
consistent execution across all product categories serves as proof of RDA's
ability to extend our successful track record into other growing markets with
our established customer relationships, strong market position and technology
innovations."

Fourth Quarter Operating Summary:

  *Revenue was $115.6 million, compared to $109.3 million in the previous
    quarter and $82.4 million in the fourth quarter of 2011. The growth in
    revenue was mainly driven by continued market share gains from baseband.
  *Gross margin was 31.7%, compared with 31.1% in the previous quarter and
    35.3% in the fourth quarter of 2011. The sequential increase in gross
    margin reflected increasing shipments of the higher margin baseband
    product RDA8851. The decrease in gross margin over the prior year period
    was primarily due to the addition of baseband revenue, which consisted
    predominately of products with lower than consolidated average corporate
    gross margin.
  *R&D expenses were $17.8 million, compared to $16.0 million in the previous
    quarter and $8.7 million in the fourth quarter of 2011. SG&A expenses were
    $5.8 million, compared to $4.0 million in the previous quarter and $3.9
    million in the prior year period.
  *The sequential increases in R&D and SG&A expenses reflect
    performance-based employee compensation expenses accrued in the quarter.
  *GAAP net income was $13.4 million, compared to $13.5 million in the
    previous quarter and $16.6 million in the fourth quarter of 2011.
  *Non-GAAP net income was $16.4 million, compared to $16.7 million in the
    previous quarter and $17.4 million in the fourth quarter of 2011.

Balance Sheet and Cash Flow Summary as of December 31, 2012:

  *Cash, cash equivalents and short-term investments were $117.5 million,
    compared to $167.0 million as of September 30, 2012. In the fourth quarter
    of 2012, the Company generated $8.7 million in cash from operations,
    compared to $10.8 million in the prior quarter. The Company also paid a
    one-time special cash dividend totaling $55.6 million on October 18, 2012.
  *Accounts receivable increased to $31.7 million, compared to $28.2 million
    as of September 30, 2012, reflecting higher sequential revenue.
  *Inventory decreased $6.5 million to $52.0 million from $58.5 million as of
    September 30, 2012. The decrease of inventory was mainly due to a strong
    sell-through during the quarter.
  *Accounts payable was $45.1 million, compared to $55.8 million as of
    September 30, 2012.

First Quarter 2013 Business Outlook:

For the first quarter of 2013, the Company expects revenue to be in the range
of $96 million to $97 million, an increase of 33.3% to 34.7% year-over-year,
and a decrease of 16.1% to 17.0% sequentially, reflecting historical seasonal
patterns including the shortened sales period due to the Chinese New Year
holiday. The Company expects gross margins to be approximately 32.0%.

Conference Call:

RDA Microelectronics will host a conference call and live webcast for analysts
and investors at 8:00 a.m. Eastern Time on February 7, 2013 (9:00 p.m. in
China).

  *For parties in the United States and Canada, please call 1-877-280-7280,
    conference code 87427013
  *For parties in Hong Kong, please call 800933597, conference code 87427013
  *Other International parties please call 1-678-825-8232, conference code
    87427013

A telephone replay of the conference call will be available approximately two
hours after the conference call and will be available for a period of 10 days.
To hear the replay, parties in the United States and Canada should call
1-855-859-2056 and enter pass code 87427013, International parties should call
1-404-537-3406 and enter the same pass code. Additionally, this conference
call will be broadcast live over the Internet and can be accessed by all
interested parties on the Investor Relations section of the Company's website
at http://www.rdamicro.com.

About RDA Microelectronics

RDA Microelectronics is a fabless semiconductor company that designs, develops
and markets wireless SoC and radio-frequency (RF) semiconductors for cellular,
connectivity and broadcast applications. The Company's product portfolio
currently includes baseband, RF front-end modules, power amplifiers,
transceivers, Bluetooth system-on-chip, Wi-Fi, Bluetooth and FM combo chips,
FM radio receivers, set-top box tuners, analog mobile television receivers,
CMMB mobile television receivers, walkie-talkie transceivers and LNB satellite
down converters. For additional information, please see the Company's website
at http://www.rdamicro.com.

Forward-Looking Statements

This announcement contains forward-looking statements. These statements are
made under the "safe harbor" provisions of the U.S. Private Securities
Litigation Reform Act of 1995. These forward-looking statements can be
identified by terminology such as "will," "expects," "anticipates," "future,"
"intends," "plans," "believes," "estimates" and similar statements. Any
statements in this press release that are not historical facts are
forward-looking statements that involve factors, risks and uncertainties that
could cause actual results to differ materially from those in the
forward-looking statements. Such factors and risks include the Company's
anticipated growth strategies; its future results of operations and financial
condition; economic conditions in China; the regulatory environment in China;
the Company's ability to attract customers and leverage its brand; trends and
competition in the semiconductor industry; migration to new technology; the
entry into baseband, new TV and display market and other factors and risks
detailed in the Company's filings with the Securities and Exchange Commission.
This press release also contains statements or projections that are based upon
information available to the public, as well as other information from sources
which the Company believes to be reliable but whose accuracy or completeness
the Company cannot guarantee. The Company undertakes no obligation to update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, unless required by applicable law.

Non-GAAP Financial Measures

To supplement the Company's unaudited consolidated financial results presented
in accordance with U.S. GAAP, the Company uses adjusted (non-GAAP) net income
and net income per diluted ADS, adjusted (non-GAAP) R&D expense and adjusted
(non-GAAP) SG&A expense, which are defined as non-GAAP financial measures by
the SEC. The presentation of these non-GAAP financial measures is not intended
to be considered in isolation or as a substitute for the financial information
prepared and presented in accordance with U.S. GAAP. For more information on
these non-GAAP financial measures, please see below and the tables captioned
"Reconciliation of GAAP and Non-GAAP Results" set forth at the end of this
press release.

The Company believes that adjusted (non-GAAP) net income and net income per
diluted ADS, adjusted (non-GAAP) R&D expense and adjusted (non-GAAP) SG&A
expense, viewed in conjunction with the GAAP financial measures, provide
meaningful supplemental information regarding the Company's performance and
that both management and investors benefit from referring to these non-GAAP
financial measures in assessing the Company's historical performance and when
planning and forecasting the Company's performance in future periods. The
Company believes that excluding share-based compensation expenses and
amortization of acquired and licensed intangibles helps both management and
investors to get a better understanding of its ongoing business. Adjusted
(non-GAAP) net income and net income per diluted ADS, adjusted (non-GAAP) R&D
expense and adjusted (non-GAAP) SG&A expense do not include share-based
compensation expenses and amortization of acquired and licensed intangibles
that impact the Company's operating expenses and net income for the period. In
addition, the Company's adjusted (non-GAAP) net income and net income per
diluted ADS, adjusted (non-GAAP) R&D expense and adjusted (non-GAAP) SG&A
expense may not be comparable to measures with the same or similar titles
utilized by other companies, since other companies may not calculate such
measures in the same manner as the Company does. The Company compensates for
this and other limitations by providing specific information regarding the
GAAP amounts excluded from these non-GAAP financial measures. Reconciliations
of GAAP and non-GAAP results are included at the end of this press release.

RDA MICROELECTRONICS, INC.                                    
Consolidated Balance Sheet                                    
Information
                               December 31,    September 30,   December 31,
                                2011            2012            2012
                               (unaudited)     (unaudited)     (unaudited)
                                (amounts in thousands of USD, except number of
                               shares and
                                per share data)
ASSETS                                                        
Current assets                                               
Cash and cash equivalents       66,178         58,848         75,091
Short-term investments-time     76,009         108,098        42,377
deposit
Accounts receivable             43,415         28,229         31,722
Inventories                    36,095         58,486         52,007
Prepaid expenses and other      7,122          10,011         11,302
current assets
Deferred tax assets             14             3              --
Total current assets            228,833        263,675        212,499
                                                             
Non-current assets                                           
Property, plant and             5,451          8,386          10,195
equipment,Net
Intangible Assets               --             50,805         54,908
Goodwill                        --             8,900          8,900
Other long-term assets          8,050          3,206          3,396
Investment                     48             48             --
Total assets                    242,382        335,020        289,898
                                                             
LIABILITIES                                                   
Current liabilities                                          
Accounts payable                32,543         55,808         45,063
Accrued expenses and other      28,253         24,739         37,869
currentliabilities
Deferred revenue                10,651         16,536         10,641
Dividend payable                --             55,946         --
Total current liabilities       71,447         153,029        93,573
                                                             
Deferred tax Liability          --             89             98
                                                             
Total liabilities               71,447         153,118        93,671
                                                             
Commitments and contingencies                                 
                                                             
SHAREHOLDERS' EQUITY                                          
Ordinary shares                 2,639          2,885          2,885
Additional paid-in capital      117,478        146,674        146,887
Recourse loans                  (509)          (1,567)        (1,544)
Accumulated other comprehensive 1,136          1,042          1,207
income
Treasury stock                  (12,835)       (14,139)       (13,579)
Retained earnings               63,026         47,007         60,371
Total shareholders' equity      170,935        181,902        196,227
                                                             
Total liabilities and           242,382        335,020        289,898
shareholders' equity

                                                            
RDA MICROELECTRONICS, INC.                                   
Consolidated Statement of Operations                          
Information
                            Quarter Ended
                            December         September        December
                             31,2011         30,2012         31,2012
                            (unaudited)      (unaudited)      (unaudited)
                            (amounts in thousands of USD, except number of
                             shares and per share data)
Revenue                      82,355          109,308         115,605
Cost of revenue              (53,258)        (75,307)        (78,949)
Gross profit                 29,097          34,001          36,656
                                                            
Operating expenses:                                          
Research and development     (8,713)         (16,029)        (17,840)
Selling, general and         (3,897)         (3,977)         (5,836)
administrative
Total operating expenses     (12,610)        (20,006)        (23,676)
Operating income             16,487          13,995          12,980
Other income:                                                
Interest income              718             1,069           808
Impairment Loss              --              --              (48)
Other income(expense), net   486             (259)           425
Income before income taxes   17,691          14,805          14,165
Income tax expense           (1,129)         (1,328)         (801)
Net income                   16,562          13,477          13,364
                                                            
                                                            
Earnings per ADS                                             
- Basic                      0.39            0.30            0.29
- Diluted                    0.37            0.28            0.28
                                                            
Weighted average ADS                                         
equivalent: [1]
- Basic                      42,781,315      45,590,013      46,327,608
- Diluted                    45,332,734      47,904,835      48,010,144
                                                            
Share-based compensation was
allocated in operating                                       
expenses as follows:
Research and development     408             446             383
Selling, general and         432             518             431
administrative
                                                            
[1] Assumes all outstanding ordinary shares are represented by ADSs. Each ADS
represents six ordinary shares.
                                                            

RDA MICROELECTRONICS, INC.                              
Consolidated Statement of Operations Information         
                                  Year Ended
                                  December 31,2011     December 31,2012
                                  (unaudited)           (unaudited)
                                  (amounts in thousands of USD, except number
                                   of shares and per share data)
Revenue                            288,862              391,279
Cost of revenue                    (189,116)            (265,474)
Gross profit                       99,746               125,805
                                                       
Operating expenses:                                     
Research and development           (32,756)             (54,598)
Selling, general and               (14,074)             (16,963)
administrative
Total operating expenses           (46,830)             (71,561)
Operating income                   52,916               54,244
Other income(expense):                                  
Interest income                    1,925                3,573
Impairment Loss                    --                   (48)
Other income (expense), net        1,460                (203)
Income before income taxes         56,301               57,566
Income tax expense                 (4,671)              (4,662)
Net income                         51,630               52,904
                                                       
                                                       
Earnings per ADS                                        
- Basic                            43,757,127           45,135,321
- Diluted                          46,467,593           47,405,084
                                                       
Weighted average ADS equivalent:                        
- Basic                            1.18                 1.17
- Diluted                          1.11                 1.12
                                                       
                                                       
Share-based compensation was
allocated in operating expenses as                      
follows:
Research and development           2,053                1,532
Selling, general and               1,828                1,679
administrative
                                                       

RDA MICROELECTRONICS, INC.
Reconciliation of GAAP and Non-GAAP Results
(amounts in thousands of USD, except number of shares and per share data)
                                                                                
                   Quarter Ended December 31, 2012
                   (unaudited)                                                                 
                              % of   Share-based  Amortization Non-GAAP Non-GAAP   % of
                                                     of           % of
                   GAAP        Net     Compensation Intangible   Net      Results     Net
                    Result     Revenue              Assets       Revenue              Revenue
Research and        17,840     15%     383         2,265       2%       15,192     13%
development
Selling, general    5,836      5%      431         --         1%       5,405      4%
and administrative
Total operating
expenses            23,676     20%     814         2,265       3%       20,597     17%

Operating income    12,980     11%     814         2,265       3%       16,059     14%
Net income         13,364     12%     814         2,265       3%       16,443     15%
                                                                                
Diluted earnings    0.28              0.02        0.05                0.34       
per ADS
                                                                                
Weighted average    48,010,144        48,010,144  48,010,144          48,010,144 
ADS-Diluted
                                                                                
                   Quarter Ended September 30, 2012
                   (unaudited)                                                                 
                              % of   Share-based  Amortization Non-GAAP Non-GAAP   % of
                                                     of           % of
                   GAAP        Net     Compensation Intangible   Net      Results     Net
                    Result     Revenue              Assets       Revenue              Revenue
Research and        16,029     15%     446         2,265       2%       13,318     13%
development
Selling, general    3,977      3%      518         --         1%       3,459      2%
and administrative
Total operating
expenses            20,006     18%     964         2,265       3%       16,777     15%

Operating income    13,995     13%     964         2,265       3%       17,223     16%
Net income         13,477     12%     964         2,265       3%       16,705     15%
                                                                                
Diluted earnings    0.28              0.02        0.05                0.35       
per ADS
                                                                                
Weighted average    47,904,835        47,904,835  47,904,835          47,904,835 
ADS-Diluted
                                                                                
                   Quarter Ended December 31, 2011
                   (unaudited)                                                                 
                              % of   Share-based  Amortization Non-GAAP Non-GAAP   % of
                                                     of           % of
                   GAAP        Net     Compensation Intangible   Net      Results     Net
                    Result     Revenue              Assets       Revenue              Revenue
Research and        8,713      10%     408         --         0%       8,305      10%
development
Selling, general    3,897      5%      432         --         1%       3,465      4%
and administrative
Total operating
expenses            12,610     15%     840         --         1%       11,770     14%

Operating income    16,487     20%     840         --         1%       17,327     21%
Net income         16,562     20%     840         --         1%       17,402     21%
                                                                                
Diluted earnings    0.37              0.02        --                 0.39       
per ADS
                                                                                
Weighted average
ADS                 45,332,734        45,332,734  45,332,734          45,332,734 
outstanding-Diluted
                                                                                
                                                                                
                   Year Ended December 31, 2012
                   (unaudited)
                              % of   Share-based  Amortization Non-GAAP Non-GAAP   % of
                                                     of           % of
                   GAAP        Net     Compensation Intangible   Net      Results     Net
                    Result     Revenue              Assets       Revenue              Revenue
Research and        54,598     14%     1,532       7,275       2%       45,791     12%
development
Selling, general    16,963     4%      1,679       --         1%       15,284     3%
and administrative
Total operating
expenses            71,561     18%     3,211       7,275       3%       61,075     15%

Operating income    54,244     14%     3,211       7,275       3%       64,730     17%
Net income         52,904     14%     3,211       7,275       3%       63,390     17%
                                                                                
Diluted earnings    47,405,084        47,405,084  47,405,084          47,405,084 
per ADS
                                                                                
Weighted average
ADS                 1.12              0.07        0.15                1.34       
outstanding-Diluted
                                                                                
                                                                                
                   Year Ended December 31, 2011
                   (unaudited)                                                                 
                              % of   Share-based  Amortization Non-GAAP Non-GAAP   % of
                                                     of           % of
                   GAAP        Net     Compensation Intangible   Net      Results     Net
                    Result     Revenue              Assets       Revenue              Revenue
Research and        32,756     11%     2,053       --         1%       30,703     10%
development
Selling, general    14,074     5%      1,828       --         0%       12,246     5%
and administrative
Total operating
expenses            46,830     16%     3,881       --         1%       42,949     15%

Operating income    52,916     18%     3,881       --         1%       56,797     19%
Net income         51,630     18%     3,881       --         1%       55,511     19%
                                                                                
Diluted earnings    46,467,593        46,467,593  46,467,593          46,467,593 
per ADS
                                                                                
Weighted average
ADS                 1.11              0.08        --                 1.19       
outstanding-Diluted

CONTACT: Lily Dong, Chief Financial Officer
         RDA Microelectronics, Inc.
         +86-21-5027-1108
         ir@rdamicro.com
        
         Or
        
         Leanne Sievers, EVP
         Shelton Group Investor Relations
         949-224-3874
         lsievers@sheltongroup.com
 
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