SEOUL, South Korea, July 31 Pixelplus-Earnings
SEOUL, South Korea, July 31 /PRNewswire-FirstCall/ -- Pixelplus Co., Ltd.
(Nasdaq: PXPL), a fabless semiconductor company in Korea that designs,
develops, and markets CMOS image sensors for various consumer electronics
applications, today announced unaudited financial results for the second
quarter of fiscal 2008, which ended on June 30, 2008.
Revenue for the second quarter of fiscal 2008 was US$3.6 million, compared
to US$3.2 million in the first quarter of fiscal 2008, and US$5.4 million in
the second quarter of fiscal 2007. The Company's revenue in the second
quarter of 2008 is consistent with the guidance the Company provided during
its fourth quarter 2007 and first quarter 2008 earnings call held on June 16,
2008.
Net loss in the second quarter of fiscal 2008 was US$2.7 million, or a net
loss of US$0.78 per diluted ADS, compared to a net loss of US$2.3 million, or
a net loss of US$0.17 per diluted ADS, in the first quarter of fiscal 2008,
and a net loss of US$1.6 million, or a net loss of US$0.13 per diluted ADS, in
the second quarter of fiscal 2007.
Revenue for the first six months of fiscal 2008 was US$6.9 million,
compared to US$9.3 million for the same period in fiscal 2007. Net loss for
the first six months of fiscal 2008 was US$5.0 million, or a net loss of
US$1.47 per diluted share, compared to a net loss of US$2.6 million, or a net
loss of US$0.20 per diluted share, for the same period in fiscal 2007.
The Company's net loss of US$0.78 per diluted ADS in the second quarter of
fiscal 2008 and net loss of US$1.47 per diluted share in the first six months
of fiscal 2008 were calculated based on Pixelplus' one-for-four reverse stock
split of its American Depositary Receipts effective as of the open of business
on April 14, 2008. In this regard, had the Company not completed this reverse
stock split, it would have sustained a net loss of about US$0.19 per diluted
ADS in the second quarter of fiscal 2008 and a net loss of roughly US$0.36 per
diluted share in the first six months of fiscal 2008.
The Company sold approximately 7.1 million image sensors in the second
quarter of fiscal 2008, which represents an increase of about 2.8 million
units from its sale of around 4.3 million units in the first quarter of fiscal
2008. Separately, the Company provided approximately 1.1 million image
sensors arising from its supply of services to a leading Japanese module maker
in the second quarter of fiscal 2008, which is almost the same as its supply
of around 1.1 million units in the first quarter of fiscal 2008. So, in terms
of combined figures, the Company sold and supplied a total of about 8.2
million image sensors in the second quarter of fiscal 2008, which represents
an increase of roughly 2.8 million units from its sale and supply of around
5.4 million units in the first quarter of fiscal 2008.
Gross margin for the second quarter of fiscal 2008 was 4.9%, compared to
11.5% in the first quarter of fiscal 2008. The Company's lower-than-expected
gross margin was due to its greater-than-anticipated decrease in the total
number of VGA image sensors sold in the second quarter of 2008, and also was
due to its greater-than-expected decrease in the average selling price of its
image sensors sold in the second quarter of 2008. To improve gross margin in
the second half of 2008, the Company expects to enhance production yields for
its PlusPixel2(TM) products with its foundry partner in Taiwan, and also
fortify its revenues arising from the steadily increasing supply of its PO4010
CIF 'System-on-a-Chip' ("SoC"), PO6030 VGA SoC, and PC1030 NTSC/PAL image
sensors.
The Company's SG&A expenses in the second quarter of fiscal 2008 were
about US$1.7 million, compared to roughly US$1.8 million in the first quarter
of fiscal 2008, and approximately US$2.7 million in the second quarter of
fiscal 2007. Moreover, the Company's operating expenses in the second quarter
of fiscal 2008 were around US$2.8 million, compared to about US$2.9 million in
the first quarter of fiscal 2008, and approximately US$3.7 million in the
second quarter of fiscal 2007.
The Company notes that all U.S. dollar figures specified above were
converted at the rate of 1,046.8 Korean won to one U.S. dollar, which is the
noon buying rate of the U.S. Federal Reserve Bank of New York in effect on
June 30, 2008.
The Company expects its revenue in the third quarter of fiscal 2008 to
sustain a percentage increase of at least 80% over the second quarter of
fiscal 2008. The Company also expects to engage in its third quarter 2008
earnings announcement and earnings call on or before October 31, 2008.
"The Company is very excited about the second half of 2008, as we expect
to significantly improve our growth and return to profitability fueled by the
strength of our new third generation product line based on PlusPixel2(TM)
technology," said Dr. S.K. Lee, CEO and Founder of Pixelplus. "We have more
products in various stages of development and deployment than ever in our
history. Strong and steadily growing demand for our PO4010 CIF SoC, PO6030
VGA SoC, and PC1030 NTSC/PAL image sensors, as well as our PM1002, which is
our new SoC processor for various image recognition applications, is expected
to positively affect the Company's results of operations, with revenues
projected to increase considerably starting in the third quarter of 2008,
based on the assumption that current order flows continue to meet our business
forecasts and projections. We continue to develop our core strategic business
with first and second-tier mobile camera phone manufacturers in Korea and
China, with automotive, security and surveillance applications manufacturers
throughout Asia, and with a leading module marker in Japan through our
co-development of image sensors. Separately, to improve profitability, we are
committed to enhancing the quality, capacity, and production yields for all of
our products and are working vigorously with all parts of our supply chain to
maximize yields in order to increase efficiencies, streamline the production
process, and drive down costs to ensure that we operate under the most
cost-effective model possible. Moreover, we continue to design and introduce
new products, technologies, and approaches to image sensor manufacturing and
release to the market other innovative technologies currently in research and
development later this year, including the PS6200 2.0 megapixel image sensors
which feature 0.13 micron CMOS process and integrate an enhanced 1.75 micron
pixel array in a 1/5 inch optical format. In addition, we are very encouraged
that we continue to effectively manage our operating expenses, and believe
this demonstrates that we have significantly lowered our breakeven point over
the course of the last few quarters. Lastly, we continue to work closely with
our customers on a pro-active basis to provide them with higher resolution,
better image quality, and smaller form factor products. By focusing on these
important areas, we are confident that we can enhance our operating model,
ramp new and existing sources of revenue, and return to profitability in the
second half of 2008."
Pixelplus will hold an investor conference call at 5:00 PM Wednesday, July
30 (New York) / 10:00 PM Wednesday, July 30 (London) / 5:00 AM Thursday, July
31 (Hong Kong/Singapore) / 6:00 AM Thursday, July 31 (Seoul/Tokyo). To access
the Pixelplus investor call, please dial one of the following numbers:
+1 480 629 1990 (North America) / +1 480 629 1990 (Europe) / +81 3 3570 8179
(Asia). To obtain replay details for the call, available for a limited time,
please contact Taylor Rafferty at the numbers provided below.
About Pixelplus Co., Ltd.
Pixelplus is a South Korea-based developer of high-performance,
high-resolution, and cost-effective CMOS image sensors for use primarily in
mobile camera phones. In addition to mobile phones, Pixelplus provides CMOS
image sensors and SoC solutions for use in webcams and notebook embedded
cameras, toys and games, and security and surveillance system applications.
As a fabless semiconductor company, Pixelplus is focused on creating
proprietary design technologies to develop CMOS image sensors with sharp,
colorful and enhanced image quality, size efficiency, and low power
consumption.
Forward Looking Statement
This press release contains certain statements that are not historical in
nature but are "forward-looking statements" within the meaning of the "safe-
harbor" provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements generally can be identified by the use of forward-
looking terminology, such as "may," "will," "expect," "intend," "estimate,"
"anticipate," "believe," "project," or "continue" or the negative of such
words or other similar words. Pixelplus cautions readers that forward-looking
statements are based on the Company's current expectations, estimates and
assumptions about our company and our industry, and are subject to a number of
risks and uncertainties. Actual results may differ materially from those
contained in such forward-looking statements. Investors are directed to
Pixelplus' reports and documents filed from time to time with the U.S.
Securities and Exchange Commission for a description of various factors that
should be considered before investing in Pixelplus' securities. These factors
may cause Pixelplus' results to differ materially from the forward-looking
statements made in this release. The forward-looking statements speak only as
of the date of this press release and Pixelplus assumes no duty or obligation
to update them to reflect new, changing, or unanticipated events or
circumstances. The financial results for the second quarter of 2008 contained
in this document have not been audited by Pixelplus' independent registered
public accountants.
Contact:
Shane Y. Hong
Pixelplus Co., Ltd.
6th Floor, Gyeonggi R&DB Center
906-5 Iui-dong, Yeongtong-gu
Suwon-si, Gyeonggi-do, 443-766
Republic of Korea
+82-31-888-5300
OR
Taylor Rafferty:
London - Emilia Whitbread at +44 (0) 20 7614 2900
New York - Jessica McCormick at +1 212 889 4350
Tokyo - Jason Wagers at +81 (0) 3 3221 9513
E-mail pixelplus@taylor-rafferty.com
Pixelplus Co., Ltd.
Consolidated Statements of Operations
(In thousands of USD, except per ADS data)
(Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
Revenues3,6275,3506,8659,281
Products 3,4323,4706,4845,651
Services1951,880 3813,630
Cost of revenues3,4503,4446,3166,352
Products 3,4132,9306,2465,452
Services 37 514 70 927
Gross profit 1771,906 5492,929
Operating expenses 2,7563,7355,6106,311
Selling, general and
administrative 1,7252,7073,5173,936
Research and development,
net of government grants 1,0311,0282,0932,375
Income(loss) from
operations(2,579) (1,829) (5,061) (3,382)
Other income(expense)
Interest income(expense),
net(32) 56 (20) 99
Foreign exchange gain
(loss), net(89) (22) 56
Reversal of Allowance for
Doubtful Accounts- 173- 621
Others, net 47 (5) 81 36
Income(loss) before income
taxes, gain from equity
method investments,
dilution gain and
minority interest (2,653) (1,627) (4,995) (2,620)
Income tax expenses ----
Income(loss) before gain
from equity method
investments, dilution gain
and minority interest (2,653) (1,627) (4,995) (2,620)
Gain from equity method
investments, net ----
Dilution gain from equity
method investment and
consolidated subsidiary----
Minority interest ----
Before cumulative effect
of change in accounting
principle (2,653) (1,627) (4,995) (2,620)
Cumulative effect of change
in accounting principle----
Net income (loss) (2,653) (1,627) (4,995) (2,620)
Accretion of preferred
shares
----
Net loss attributable to
common shareholders (2,653) (1,627) (4,995) (2,620)
Loss per ADS - basic and
diluted(0.78) (0.13) (1.47) (0.20)
ADSs used in computing
loss per ADS - basic
and diluted3,400,112 12,944,1463,400,112 12,944,146
Pixelplus Co., Ltd.
Consolidated Balance Sheets
(In thousands of USD, except per ADS data)
(Unaudited)
June 30, 2008 Dec. 31, 2007
Assets
Cash and cash equivalents 1,108600
Restricted cash 4,776 5,732
Accounts receivable, net 4,592 3,023
Inventories, net 6,092 1,360
Other current assets 3,432 1,842
Total current assets 20,000 12,557
Other non current assets 6,943 5,788
Total assets 26,943 18,345
Liabilities, minority interest
and Shareholders' equity
Trade accounts payable6,767518
Other accounts payable1,292788
Short-term borrowings 8,864 5,207
Other current liabilities 2,973 1,264
Total current liabilities 19,896 7,777
Long-term borrowings 1,085 -
Other non current liabilities 565403
Total liabilities 21,546 8,180
Minority interest - -
Series A convertible redeemable
preferred stock- -
Shareholders' equity
Common stock 3,251 3,184
Additional paid-in capital 38,439 38,289
Accumulated other comprehensive
loss (84) (94)
Accumulated deficit (36,209) (31,214)
Total Shareholders' equity5,397 10,165
Total liabilities, minority interest
and Shareholders' equity 26,943 18,345
The Company's functional currency on a consolidated basis is the Korean
won. The U.S. dollar amounts disclosed in the financial statements are
presented solely for the convenience of the reader, and have been converted at
the rate of 1,046.8 Korean won to one U.S. dollar, which is the noon buying
rate of the U.S. Federal Reserve Bank of New York in effect on June 30, 2008.
Such conversions should not be construed as representations that the Korean
won amounts represent, have been, or could be, converted into, U.S. dollars at
that or any other rate. Please note that the numbers specified for the fiscal
year 2007 in the financial statements provided in the Company's Form 20-F,
which were converted at the rate of 935.8 Korean won to one U.S. dollar in
effect on December 31, 2007, are different from the numbers specified for the
fiscal year 2007 in the above financial statements.
SOURCE Pixelplus Co., Ltd.
