CEVA, Inc. Announces Second Quarter 2013 Financial Results -- Key OEMs in mobile markets license CEVA-MM3101 imaging & vision platform -- Strategic customer extends use of DSP for 3G & LTE basebands -- Expansion of existing stock repurchase program with additional two million shares PR Newswire MOUNTAIN VIEW, Calif., July 31, 2013 MOUNTAIN VIEW, Calif., July 31, 2013 /PRNewswire/ -- CEVA, Inc. (NASDAQ: CEVA), the leading licensor of silicon intellectual property (SIP) platform solutions and DSP cores for the mobile, digital home and networking markets, today announced its financial results for the second quarter ended June 30, 2013. (Logo:http://photos.prnewswire.com/prnh/20120808/SF53702LOGO) Total revenue for the second quarter of 2013 was $12.8 million, a decrease of 6% compared to $13.6 million for the second quarter of 2012. Licensing and related revenue for the second quarter of 2013 was $6.1 million, an increase of 2% compared to $6.0 million reported for the second quarter of 2012. Royalty revenue for the second quarter of 2013 was $6.7 million, a decrease of 12% compared to $7.6 million reported for the second quarter of 2012. Gideon Wertheizer, Chief Executive Officer, stated: "Our strong performance in licensing activities for the second quarter was a direct result of our strategy to expand beyond the cellular baseband market. During the quarter, we successfully completed two comprehensive agreements for our CEVA-MM3101 multimedia platforms with key OEMs in the mobile space who are expected to utilize our technology to develop their own proprietary multimedia processing chips. These agreements illustrate our ability to successfully capitalize on emerging technology trends in photography, vision and audio, and build the foundations for our future royalty growth. In addition, we extended our relationship with a key customer in the cellular baseband market, reinforcing our position in the 3G and LTE markets." U.S. GAAP net income for the second quarter of 2013 was $2.2 million, a decrease of 37% from $3.5 million reported for the same period in 2012. U.S. GAAP diluted earnings per share for the second quarter of 2013 were $0.10, a decrease of 33% compared to $0.15 for the second quarter of 2012. Non-GAAP net income and diluted earnings per share for the second quarter of 2013 was $3.4 million and $0.15, respectively, representing a decrease of 24% and 21%, respectively, over the $4.4 million and $0.19 reported for the second quarter of 2012. Non-GAAP net income and diluted earnings per share for the second quarter of 2013 and 2012 excluded equity-based compensation expense, net of taxes, of $1.2 million and $1.0 million, respectively. During the second quarter of 2013, the Company concluded six new license agreements. Four of the agreements were for CEVA DSP cores, platforms and software, one for SATA/SAS technology and one for Bluetooth technology. Target applications for customer deployment are 3G and LTE cellular handsets, imaging, and embedded vision and audio for mobile devices. Geographically, one of the license agreements was in the U.S. and the other five were in Asia, including Japan. Yaniv Arieli, Chief Financial Officer, stated, "During the second quarter, our royalty revenue from 3G shipments surpassed the 2G royalty revenue for the first time. This is an important milestone that reflects our strong foothold in the growing adoption of low-cost smartphones in China. During the quarter, we bought back approximately 176,000 shares of our common stock for an aggregate consideration of approximately $2.8 million. Furthermore, the Board of Directors has authorized the expansion of our share repurchase program with an additional two million shares of common stock available for repurchase. In total, there are 2,179,000 shares available for repurchase under our 10b-18 plan program, illustrating our confidence in the long-term growth opportunities for CEVA, the Company's robust fundamentals and considerable earnings leverage. Our financial position remains strong with our cash balance, marketable securities and bank deposits totaling $154 million at the end of the quarter." CEVA Conference Call On July 31, 2013, CEVA management will conduct a conference call at 8:30 a.m. Eastern Time, to discuss the operating performance for the second quarter ended June 30, 2013. The conference call will be available via the following dial in numbers: oU.S. Participants: Dial 1-800-860-2442 (Access Code: CEVA) oInternational Participants: Dial +1-412-858-4600 (Access Code: CEVA) The conference call will also be available live via the Internet at the following link: http://www.videonewswire.com/event.asp?id=94830. Please go to the web site at least fifteen minutes prior to the call to register, download and install any necessary audio software. For those who cannot access the live broadcast, a replay will be available by dialing +1-877-344-7529 or +1-412-317-0088 (access code: 10030920) from one hour after the end of the call until 9:00 a.m. (Eastern Time) on August 7, 2013. The replay will also be available at CEVA's web site www.ceva-dsp.com. About CEVA, Inc. CEVA is the world's leading licensor of silicon intellectual property (SIP) DSP cores and platform solutions for the mobile, portable and consumer electronics markets. CEVA's IP portfolio includes comprehensive technologies for cellular baseband (2G / 3G / 4G), multimedia (vision, imaging and HD audio), voice processing, Bluetooth, Serial Attached SCSI (SAS) and Serial ATA (SATA). In 2012, CEVA's IP was shipped in over 1.1 billion devices, powering smartphones from many of the world's leading OEMs, including HTC, Huawei, LG, Nokia, Motorola, Samsung, Sony, TCL and ZTE. Today, more than 40% of handsets shipped worldwide are powered by a CEVA DSP core. For more information, visit www.ceva-dsp.com. Follow CEVA on twitter at www.twitter.com/cevadsp. Forward Looking Statement This press release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that if they materialize or prove incorrect, could cause the results of CEVA to differ materially from those expressed or implied by such forward-looking statements and assumptions. Forward-looking statements include Mr. Wertheizer's statements about the agreements entered into during the second quarter of 2013 illustrating CEVA's ability to successfully capitalize on emerging technology trends in photography, vision and audio, and build the foundations for its' future royalty growth, Forward-looking statements also include Mr. Arieli's statements about CEVA's stock buyback program reflecting CEVA's confidence in its long-term growth opportunities, robust fundamentals and considerable earnings leverage. The risks, uncertainties and assumptions include: the ability of the CEVA DSP cores and other technologies to continue to be strong growth drivers for us; our success in penetrating new markets and maintaining our market position in existing markets; the ability of products incorporating our technologies to achieve market acceptance, the effect of intense industry competition and consolidation, global chip market trends, the possibility that markets for our technologies may not develop as expected or that products incorporating our technologies do not achieve market acceptance; our ability to timely and successfully develop and introduce new technologies; and general market conditions and other risks relating to our business, including, but not limited to, those that are described from time to time in our SEC filings. CEVA assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. CEVA, INC. AND ITS SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME – U.S. GAAP U.S. dollars in thousands, except per share data Three months ended Six months ended June 30, June 30, 2013 2012 2013 2012 Unaudited Revenues: Licensing and related revenues $ 6,129 $ 5,997 $ 11,163 $ 12,003 Royalties 6,684 7,595 13,766 16,701 Total revenues 12,813 13,592 24,929 28,704 Cost of revenues 1,093 1,011 2,668 1,881 Gross profit 11,720 12,581 22,261 26,823 Operating expenses: Research and development, net 5,621 5,425 10,660 10,911 Sales and marketing 2,540 2,104 4,895 4,393 General and administrative 1,744 1,849 3,582 3,718 Total operating expenses 9,905 9,378 19,137 19,022 Operating income 1,815 3,203 3,124 7,801 Financial income, net 707 974 1,436 1,922 Income before taxes on income 2,522 4,177 4,560 9,723 Taxes on income 347 698 680 1,387 Net income 2,175 3,479 3,880 8,336 Basic net income per share $0.10 $0.15 $0.18 $0.36 Diluted net income per share $0.10 $0.15 $0.17 $0.35 Weighted-average number of Common Stock used in computation of net incomeper share (in thousands): Basic 22,087 22,873 22,142 23,188 Diluted 22,546 23,449 22,608 23,842 Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures (U.S. Dollars in thousands, except per share amounts) Three months ended Six months ended June 30 June 30 2013 2012 2013 2012 Unaudited GAAP net income $2,175 $3,479 $3,880 $8,336 Equity-based compensation expense 81 53 150 104 included in cost of revenue Equity-based compensation expense included in research and development 409 394 855 859 expenses Equity-based compensation expense 332 200 628 439 included in sales and marketing expenses Equity-based compensation expense included in general and administrative 524 430 1031 920 expenses Deferred tax related to equity-based (135) (118) (252) (242) compensation expenses Taxes on income (1) -- -- -- (102) Non-GAAP net income $3,386 $4,438 $6,292 $10,314 (1)Results for the six months ended June 30, 2012 include the utilization of expenses on a previously booked capital gain GAAP weighted-average number of Common Stock used in computation of diluted net 22,546 income per share (in thousands) 23,449 22,608 23,842 Weighted-average number of shares related 1 5 1 6 to outstanding options (in thousands) Weighted-average number of Common Stock used in computation of diluted net income 22,547 23,454 22,609 23,848 per share excluding equity-based compensation expense (in thousands) GAAP diluted net income per share $0.10 $0.15 $0.17 $0.35 Equity-based compensation expense, net of $0.05 $0.04 $0.11 $0.08 taxes Non-GAAP diluted net income per share $0.15 $0.19 $0.28 $0.43 CEVA, INC. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (U.S. Dollars in thousands) June 30, December 31, 2013 2012 (*) Unaudited ASSETS Current assets: Cash and cash equivalents $ 7,539 $ 18,422 Marketable securities and short term bank 118,627 116,572 deposits Trade receivables, net 9,186 6,232 Deferred tax assets 2,565 2,065 Prepaid expenses and other current assets 3,071 2,361 Total current assets 140,988 145,652 Long-term assets: Long term bank deposits 28,226 23,050 Severance pay fund 6,615 6,130 Deferred tax assets 1,305 1,178 Property and equipment, net 1,707 1,392 Goodwill 36,498 36,498 Investment in other companies 2,733 2,433 Total assets $ 218,072 $ 216,333 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Trade payables $ 1,198 $ 1,176 Deferred revenues 539 865 Accrued expenses and other payables 2,595 3,462 Accrued payroll and related benefits 6,411 6,978 Income taxes payable, net 2,127 1,626 Total current liabilities 12,870 14,107 Accrued severance pay 6,722 6,158 Total liabilities 19,592 20,265 Stockholders' equity: Common stock: 22 22 Additional paid in-capital 201,159 198,495 Accumulated other comprehensive income (367) 360 (loss) Treasury stock (27,737) (25,694) Retained earnings 25,403 22,885 Total stockholders' equity 198,480 196,068 Total liabilities and $ 218,072 $ 216,333 stockholders' equity (*) Derived from audited financial statements SOURCE CEVA, Inc. Website: http://www.ceva-dsp.com Contact: Yaniv Arieli, CEVA, Inc., CFO, +1.650.417.7941, firstname.lastname@example.org, or Richard Kingston, CEVA, Inc., Director of Marketing & Investor Relations, +1.650.417.7976, email@example.com
CEVA, Inc. Announces Second Quarter 2013 Financial Results
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