OmniVision Reports Financial Results For the Third Quarter of Fiscal 2013

  OmniVision Reports Financial Results For the Third Quarter of Fiscal 2013

~ Third Quarter Revenues Grow 128.7% Year-Over-Year

PR Newswire

SANTA CLARA, Calif., Feb. 28, 2013

SANTA CLARA, Calif., Feb. 28, 2013 /PRNewswire/ -- OmniVision Technologies,
Inc. (Nasdaq: OVTI), a leading developer of advanced digital imaging
solutions, today reported financial results for the third quarter of fiscal
2013 that ended on January31, 2013.

Revenues for the third quarter of fiscal2013 were $423.5million, as compared
to $390.1million in the second quarter of fiscal2013, and $185.2million in
the third quarter of fiscal2012. GAAP net income in the third quarter of
fiscal2013 was $21.3million, or $0.40per diluted share, as compared to net
income of $10.3million, or $0.19per diluted share in the second quarter of
fiscal2013, and $111,000, or $0.00per diluted share in the third quarter of
fiscal2012. For the third quarter of fiscal2013, the Company recorded a tax
benefit of approximately $3.2million that resulted from the retroactive
extension of the U.S. Federal Research and Development tax credit when the
American Taxpayer Relief Act was signed into law on January2, 2013.

Non-GAAP net income in the third quarter of fiscal2013 was $31.5million, or
$0.56per diluted share. Non-GAAP net income in the second quarter of
fiscal2013 was $18.6million, or $0.33per diluted share. Non-GAAP net income
in the third quarter of fiscal2012 was $7.4million, or $0.13per diluted
share. Non-GAAP net income excludes stock-based compensation expenses and the
related tax effects. Please refer to the attached schedule for a
reconciliation of GAAP net income to non-GAAP net income for the three and
nine months ended January31, 2013 and 2012 and for the three months ended
October31, 2012.

GAAP gross margin for the third quarter of fiscal2013 was 16.9%, as compared
to 16.6% for the second quarter of fiscal2013 and 24.2% for the third quarter
of fiscal2012. The sequential increase in third quarter gross margin
reflected primarily a favorable change in product mix.

The Company ended the period with cash, cash equivalents and short-term
investments totaling $220.3million, an increase of $80.7million from the
previous quarter. The increase was attributable to cash provided by operating
activities in the third quarter of fiscal2013.

"I am proud to report that we have set a new record for ourselves in the third
quarter, in both dollar revenues and unit shipments. It is also the fourth
consecutive quarter that OmniVision has posted higher revenues," said Shaw
Hong, chief executive officer of OmniVision Technologies, Inc. "We are also
pleased to report an incremental improvement in gross margin, while at the
same time noting that more work remains."

Outlook

Based on current trends, the Company expects revenues for the fourth quarter
of fiscal2013 will be in the range of $300million to $330million and GAAP
net income per share will be between $0.00and $0.15per diluted share.
Excluding the estimated expense and related tax effects associated with
stock-based compensation, the Company expects its non-GAAP net income per
share will be between $0.14and $0.29per diluted share. Refer to the table
below for a reconciliation of GAAP to non-GAAP net income.

Conference Call

OmniVision Technologies, Inc. will host a conference call today at 5:00p.m.
Eastern time to discuss these results further. This conference call can be
accessed via a webcast at www.ovt.com. The call can also be accessed by
dialing 866-770-7120(domestic) or 617-213-8065(international) and entering
passcode32627913.

A replay of the call will remain available at www.ovt.com for approximately
twelve months. A replay of the call will also be available for one week
beginning approximately one hour after the conclusion of the call. To access
the replay, dial888-286-8010 (domestic) or 617-801-6888(international) and
enter passcode65296443.

About OmniVision

OmniVision Technologies, Inc. is a leading developer of advanced digital
imaging solutions. Its CameraChip™ and CameraCubeChip™ products using
CameraCubeChip™, OmniBSI™, OmniBSI+™, OmniBSI-2™, OmniPixel®, OmniPixel2™,
OmniPixel3™ and OmniPixel3-HS™ technologies are highly integrated, single-chip
CMOS image sensors for consumer and commercial applications including mobile
phones, tablets, notebooks and webcams, entertainment devices, security and
surveillance systems, digital still and video cameras, automotive and medical
imaging systems. Additional information is available at www.ovt.com.

Safe Harbor Statement

Certain statements in this press release, including statements relating to our
expectations regarding revenues and earnings per share for the three months
ending April30, 2013 are forward-looking statements. These forward-looking
statements are based on management's current expectations, and certain factors
could cause actual results to differ materially from those in the
forward-looking statements. These factors include, without limitation, our
ability to maintain and increase sales to current key customers and end-users
of our products; competition in current and emerging markets for image sensor
products, including pricing pressures that could result from competition; our
ability to increase the average selling prices or lower the costs associated
with the development and manufacture of our new, complex products and
technologies; fluctuations of wafer manufacturing costs, manufacturing yields,
manufacturing capacity and other manufacturing processes and the impact on
gross margins; the continued growth and development of current markets and the
emergence of new markets in which we sell, or may sell, our products;
fluctuations in sales mix and average selling prices; our ability to timely
complete the product development cycle for new sensors; our ability to obtain
design wins from various image sensor device manufacturers including
manufacturers of mobile phones, tablets, notebooks and webcams, entertainment
devices, security and surveillance systems, digital still and video cameras,
automotive and medical imaging systems; our dependence on third party wafer
foundries and their ability to manufacture our wafers in the required
quantities, at acceptable quality, yields and costs, and in a timely manner;
our ability to accurately forecast customer demand for our products; the
impact of general economic conditions on orders from the end-user customers of
our products; the market acceptance of products into which our products are
designed; the development, production, introduction and marketing of new
products and technology; the occurrence of litigation regarding our
intellectual property or indemnification claims from our suppliers or
customers relating to our intellectual property; our strategic investments and
relationships, and other risks detailed from time to time in our Securities
and Exchange Commission filings and reports, including, but not limited to,
our most recent Annual Report on Form10-K and recent Quarterly Reports on
Form10-Q. We expressly disclaim any obligation to update information
contained in any forward-looking statement.

Use of Non-GAAP Financial Information

To supplement the reader's overall understanding of both its reported results
presented in accordance with U.S. generally accepted accounting principles
("GAAP") and its outlook, the Company also presents non-GAAP measures of net
income and net income per share which are adjusted from results based on GAAP.
In particular, the Company excludes stock-based compensation expenses and the
related tax effects. The non-GAAP financial measures which the Company
discloses also exclude the effects of stock-based compensation on the number
of basic and diluted common shares used in calculating non-GAAP basic and
diluted net income per share. The Company provides these non-GAAP financial
measures to enhance an investor's overall understanding of its current
financial performance and to assess its prospects for the future. These
non-GAAP financial measures reflect an additional way of viewing aspects of
the Company's operations that, when viewed with its GAAP results and the
accompanying reconciliations to the corresponding GAAP financial measures,
provide a more complete understanding of factors and trends affecting the
Company's business. The economic basis for the Company's decision to use
non-GAAP financial measures is that the adjustments to net income did not
reflect the on-going relative strength of the Company's performance. The
Company's objective is to minimize any confusion in the financial markets by
providing non-GAAP net income and non-GAAP net income per share measurements
and disclosing the related components. These non-GAAP financial measures
should be considered as a supplement to, and not as a substitute for, or
superior to, the financial measures prepared in accordance with GAAP.

The Company uses non-GAAP financial measures for internal management purposes
to conduct and evaluate its business, when publicly providing its business
outlook and to facilitate period-to-period comparisons. The Company views
non-GAAP net income per share as a primary indicator of the profitability of
its underlying business. In addition, because stock-based compensation is a
non-cash expense and is offset in full by a credit to paid-in capital, it has
no effect on total stockholders' equity. As the calculation of non-GAAP
financial measures differs between companies, the non-GAAP financial measures
used by the Company may not be comparable to similarly titled measures used by
other companies. Other than stock-based compensation and the related tax
effects, these differences may cause the Company's non-GAAP measures to not be
directly comparable to other companies' non-GAAP measures. Although these
non-GAAP financial measures adjust cost, expenses and basic and diluted share
items to exclude the accounting treatment of stock-based compensation, they
should not be viewed as a non-GAAP presentation reflecting the elimination of
the underlying stock-based compensation programs. Thus, the Company's non-GAAP
presentations are not intended to present, and should not be used, as a basis
for assessing what its operating results might be if it were to eliminate its
stock-based compensation programs. The Company compensates for these
limitations by providing full disclosure of the net income and net income per
share on a basis prepared in accordance with GAAP to enable investors to
consider net income and net income per share determined under GAAP as well as
on an adjusted basis, and perform their own analysis, as appropriate. As a
result of the foregoing limitations, the Company does not use, nor does the
Company intend to use, the non-GAAP financial measures when assessing the
Company's performance against that of other companies.

Estimating stock-based compensation expenses and the related tax effects for a
future period is subject to inherent risks and uncertainties, including but
not limited to the price of the Company's stock, stock market volatility,
expected option life, risk-free interest rates, and the number of option
exercises and sales during the quarter.

OMNIVISION TECHNOLOGIES, INC.
RECONCILIATION OF GUIDANCE FOR GAAP NET INCOME PER DILUTED SHARE TO PROJECTED
NON-GAAP NET INCOME PER DILUTED SHARE
(unaudited)
                  Three Months Ending April30, 2013
                  GAAP                                  Non-GAAP

                  Range of Estimates                    Range of Estimates
                  From        To         Adjustment     From        To
Net income per    $  0.00    $  0.15    $      $  0.14    $  0.29
share                                    0.14^(1)

 ^(1) Reflects estimated adjustment for expense and related tax effects
associated with stock-based compensation.

OMNIVISION TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
(unaudited)
                                                   January31,   April30,
                                                   2013          2012
ASSETS
Current assets:
 Cash and cash equivalents                    $   194,841 $   290,492
 Short-term investments                       25,460        40,515
 Accounts receivable, net of allowances for   171,926       107,793
doubtful accounts and sales returns
 Inventories                                  373,335       291,340
 Prepaid and deferred income taxes            2,397         4,083
 Prepaid expenses and other current assets    9,362         8,542
 Total current assets                   777,321       742,765
Property, plant and equipment, net                 162,182       144,792
Long-term investments                              132,866       128,940
Goodwill                                      10,227        10,227
Intangibles, net                                   60,037        69,028
Other long-term assets                             21,901        7,205
 Total assets                     $ 1,164,534   $ 1,102,957
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
 Accounts payable                             $   152,347 $   159,860
 Accrued expenses and other current           34,660        35,416
liabilities
 Income tax payable                           1,000         987
 Deferred revenues, less cost of revenues     16,199        10,115
 Current portion of long-term debt            3,739         3,146
 Total current liabilities              207,945       209,524
Long-term liabilities:
 Long-term income taxes payable               85,761        88,159
 Non-current portion of long-term debt        35,735        39,337
 Other long-term liabilities                  4,768         5,058
 Total long-term liabilities            126,264       132,554
 Total liabilities                      334,209       342,078
Stockholders' equity:
 Common stock, $0.001 par value;
100,000shares authorized; 74,523shares issued
and 53,924 outstanding at January31, 2013 and     74            73
72,964shares issued and 52,365outstanding at
April30, 2012, respectively
 Additional paid-in capital                   611,096       575,935
 Accumulated other comprehensive income       3,274         2,970
 Treasury stock, 20,599 at January31, 2013   (278,683)     (278,683)
and April30, 2012, respectively
 Retained earnings                            494,564       460,584
 Total stockholders' equity             830,325       760,879
 Total liabilities and stockholders'    $ 1,164,534   $ 1,102,957
equity

OMNIVISION TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
(unaudited)
                              Three Months Ended    Nine Months Ended
                              January31,           January31,
                              2013       2012       2013            2012
Revenues                      $ 423,513  $ 185,193  $ 1,071,714     $ 679,183
Cost of revenues              352,027    140,337    886,329         480,273
 Gross profit            71,486     44,856     185,385         198,910
Operating expenses:
 Research, development   27,380     26,193     86,589          83,565
and related
 Selling, general and    18,221     15,842     55,080          47,716
administrative
 Amortization of         2,321      2,321      6,964           6,964
acquired patent portfolio
 Total operating   47,922     44,356     148,633         138,245
expenses
Income from operations        23,564     500        36,752          60,665
Benefit from acquisition of
production operations from    —          —          —               8,626
VisEra
Equity in earnings of         923        543        3,255           2,238
investees, net
Interest expense, net         (715)      (734)      (2,201)         (1,203)
Other income (expense), net   (5)        (220)      311             (1,359)
Income before income taxes    23,767     89         38,117          68,967
Provision for (benefit from)  2,459      (22)       4,137           5,799
income taxes
Net income                    $  21,308 $      $   33,980    $  63,168
                                         111
Net income per share:
 Basic                   $   0.40 $   0.00 $     0.64 $   1.09
 Diluted            $   0.40 $   0.00 $     0.64 $   1.05
Shares used in computing net
income per share:
 Basic                   53,830     56,070     53,391          58,111
 Diluted            53,930     56,180     53,497          59,980

OMNIVISION TECHNOLOGIES, INC.
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME
(in thousands, except per share amounts)
(unaudited)
                         Three Months Ended  Nine Months Ended   Three Months
                                                                 Ended
                         January31,         January31,         October31,
                         2013      2012      2013      2012      2012
GAAP net income          $ 21,308  $      $ 33,980  $ 63,168  $  10,345
                                   111
Add:
 Stock-based
compensation in cost of  914       831       2,951     2,007     977
revenues
 Stock-based
compensation in          3,668     3,618     12,533    9,471     4,113
research, development
and related expenses
 Stock-based
compensation in selling, 3,206     2,866     10,266    7,871     3,344
general and
administrative expenses
(Increase) decrease in
provision for income
taxes without the effect 2,362     (29)      1,840     2,125     (228)
of stock-based
compensation
Non-GAAP net income      $ 31,458  $  7,397 $ 61,570  $ 84,642  $  18,551
GAAP provision for                 $   
(benefit from) income    $  2,459 (22)     $  4,137 $  5,799 $   4,211
taxes
(Increase) decrease in
provision for income
taxes without the effect 2,362     (29)      1,840     2,125     (228)
of stock-based
compensation
Non-GAAP provision for   $     $     $  2,297 $  3,674 $   4,439
income taxes             97         7
Non-GAAP net income per
share:
  Basic        $       $       $       $       $    0.35
                         0.58      0.13      1.15      1.46
  Diluted      $       $       $       $       $    0.33
                         0.56      0.13      1.10      1.39
Shares used in computing
non-GAAP net income per
share:
  Basic        53,830    56,070    53,391    58,111    53,514
  Diluted      56,453    58,411    55,947    61,090    56,211



SOURCE OmniVision Technologies, Inc.

Website: http://www.ovt.com
Contact: Investor Relations, Arnab Chanda, OmniVision Technologies, Inc.,
+1-408-653-3144, invest@ovt.com