BEIJING, June 9 /PRNewswire-Asia-FirstCall/ -- Vimicro International Corporation (Nasdaq: VIMC) ("Vimicro"), a leading multimedia semiconductor and solution provider, today announced financial results for the first quarter ended March 31, 2010.
First Quarter 2010
Net revenue in the first quarter of 2010 was $20.1 million, compared to $10.0 million in the first quarter of 2009 and $23.7 million in the fourth quarter of 2009. The significant increase from the prior year period reflects strong demand for the Company's notebook camera and TD-SCDMA based 3G mobile multimedia processors and general improvements in the global economic conditions. Gross margin was 33.6% compared to 29.7% of revenue in the fourth quarter.
Dr. John Deng, Vimicro's Chairman and Chief Executive Officer, commented, "First quarter 2010 outperformed typical seasonal trends as demands for notebook and mobile multimedia products are strong. Notebook product unit shipments increased 33 percent over last quarter driven by strong purchasing trends from tier-one global brands. More importantly, we began volume shipments of our TD-SCDMA based 3G mobile multimedia processors with high ASPs during the quarter."
First quarter 2010 net loss, prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP), was $5.7 million, which included $1.2 million in share-based compensation expense and $1.7 million IP/Software purchase expense. After excluding loss attributable to non-controlling interest, net loss attributed to Vimicro was $4.4 million in the first quarter, or $0.12 loss per ADS (each representing four ordinary shares), compared to a net loss of $6.7 million, or $0.19 loss per ADS, in the first quarter of 2009 and a net loss of $0.6 million, or $0.02 loss per ADS, last quarter.
Dr. Deng concluded, "Over the past year, Vimicro has made significant progress in leveraging our core technology expertise and intellectual property to expand our business from a single product line into new high growth market segments. As we look to the second half of the year, we are well positioned to benefit from new product cycles in the 3G market, and in the security and surveillance market, as well as continued growth in our notebook lines. Collectively, these growth initiatives will assist in moving the Company toward our goal of profitability."
For the second quarter of 2010, the Company expects revenue to range between $24 million and $26 million, representing 28 percent to 39 percent growth over the $18.7 million reported in the second quarter of 2009, and 19 percent to 29 percent sequential growth over the first quarter. The expected growth is primarily driven by strong orders of Vimicro's notebook cameras processors as well as increasing contribution from TD-SCDMA based 3G mobile multimedia products.
Financial Results Conference Call and Webcast
Vimicro will host a conference call and Webcast June 9, 2010 at 6:30 p.m. Eastern Time to discuss the Company's recent results. Investors and other interested parties may access the call by dialing 800-659-1966 (or +1-617-614-2711 outside of the U.S.) with the pass code 89023174, at least 10 minutes prior to the start of the call.
In addition, an audio Webcast will be available in the Investor Relations section of the Company's Web site at http://www.vimicro.com . Following the live Webcast, an archived version will be available on the Company's Web site. A telephone replay of the call will also be available approximately two hours after the call and will be available until June 16, 2010 at midnight (ET). The replay number is 888-286-8010 with a pass code of 99669983. International callers should dial +1-617-801-6888 and enter the same pass code at the prompt.
About Vimicro International Corporation
Vimicro International Corporation is a leading multimedia semiconductor and solution provider that designs, develops and markets mixed-signal semiconductor products and system-level solutions that enable multimedia capabilities in a variety of products for the consumer electronics and communications markets. Vimicro is also expanding business into the surveillance market with system-level solutions and semiconductor products. Vimicro's ADSs, each of which represents four ordinary shares, are currently trading on the NASDAQ Global Market under the ticker symbol "VIMC."
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," "confident" and similar statements. Among other things, the quotations from management in this announcement, as well as Vimicro's expectations and forecasts, contain forward-looking statements. Vimicro may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission on forms 20-F and 6-K, etc., in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Vimicro's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the company's ability to develop and sell new mobile multimedia products; the expected growth of the mobile multimedia market; the company's ability to increase sales of notebook camera multimedia processors; the company's ability to retain existing customers and acquire new customers and respond to competitive market conditions; the company's ability to respond in a timely manner to the evolving multimedia market and changing consumer preferences and industry standards and to stay abreast of technological changes; the company's ability to secure sufficient foundry capacity in a timely manner; the company's ability to effectively protect its intellectual property and the risk that it may infringe on the intellectual property of others; and cyclicality of the semiconductor industry. Further information regarding these and other risks is included in Vimicro's annual report on Form 20-F filed with the Securities and Exchange Commission. Vimicro does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date hereof, and Vimicro undertakes no duty to update such information, except as required under applicable law.
This announcement contains translations of certain RMB amounts into U.S. dollars. Unless otherwise noted, all translations from RMB to U.S. dollars are based on the applicable exchange rates quoted by the Bank of China as of March 31, 2010, which was RMB 6.8263 to $1.00.
Vimicro International Corporation Consolidated Balance Sheets (Amounts expressed in thousands of U.S. dollars, except number of share data) 3/31/2010 12/31/2009 (unaudited) (audited) Assets Current assets: Cash and cash equivalents 67,164 84,510 Short-term time deposits 43,948 43,935 Restricted cash 132 132 Marketable equity securities 556 543 Accounts receivable, net of provision for doubtful accounts 12,028 9,462 Inventories 11,396 8,804 Prepayments and other current assets 4,429 4,155 Deferred tax assets 3 3 Total current assets 139,656 151,544 Property, equipment and software, net 8,724 9,015 Land use rights 20,116 10,905 Intangible assets, net 3,576 3,819 Goodwill 2,020 2,019 Other assets 964 973 Total assets 175,056 178,275 Liabilities and Shareholders' Equity Current liabilities: Accounts payable 5,626 4,958 Taxes payable 953 879 Advances from customers 519 649 Accrued expenses and other current liabilities 4,332 5,900 Deferred government grants 3,296 3,844 Total current liabilities 14,726 16,230 Non-Current liabilities: Deferred tax liabilities 66 196 Product warranty 25 25 Total liabilities 14,817 16,451 Shareholders' equity: Ordinary shares, $0.0001 par value, 500,000,000 shares authorized, 147,673,168 and 147,643,168 shares issued and outstanding as of March 31, 2010 and December 31, 2009, respectively 15 15 Additional paid-in capital 153,439 151,672 Treasury stock (2,664) (2,664) Accumulated other comprehensive income 10,013 9,967 Accumulated deficit (40,194) (35,786) Statutory reserve 2,782 2,782 Total shareholders equity attributable to Vimicro International Corporation 123,391 125,986 Noncontrolling interest 36,848 35,838 Total shareholders' equity 160,239 161,824 Total liabilities and shareholders' equity 175,056 178,275 Vimicro International Corporation Consolidated Statement Of Operations and Comprehensive Income (Amounts expressed in thousands of U.S. dollars, except number of share data) 2010 Q1 2009 Q4 2009 Q1 (unaudited) (unaudited) (unaudited) Net revenue 20,110 23,732 10,022 Cost of revenue (13,351) (16,673) (7,140) Gross profit 6,759 7,059 2,882 Operating expenses: Research and development, net (8,750) (6,706) (5,965) Selling and marketing (1,457) (1,867) (992) General and administrative (3,208) (2,838) (2,856) Total operating expenses (13,415) (11,411) (9,813) Loss from operations (6,656) (4,352) (6,931) Other income/(expense): Interest income 309 321 352 Foreign exchange (loss)/gain, net (35) (34) 9 Gain on disposal of available-for-sale securities -- 1,949 -- Others, net 861 614 (17) Loss before income taxes (5,521) (1,502) (6,587) Income taxes expense (172) (91) -- Net loss (5,693) (1,593) (6,587) Less: (loss)/income attributable to non- controlling interest (1,285) (993) 67 Loss attributed to Vimicro International Corporation (4,408) (600) (6,654) Other comprehensive income/(loss): Foreign currency translation adjustment 33 (29) (35) Unrealized gain/(loss) on marketable equity securities 13 (1,472) 730 Comprehensive loss (5,647) (3,094) (5,892) Less: comprehensive (loss)/income attributable to non- controlling interest (1,285) (990) 60 Comprehensive loss attributable to Vimicro International Corporation (4,361) (2,104) (5,952) Loss per share Basic (0.03) (0.00) (0.05) Diluted (0.03) (0.00) (0.05) Loss per ADS Basic (0.12) (0.02) (0.19) Diluted (0.12) (0.02) (0.19) Weighted average number of ordinary shares outstanding Basic 147,657,701 147,518,482 137,772,235 Diluted 147,657,701 147,518,482 137,772,235 Weighted average number of ADS outstanding Basic 36,914,425 36,879,621 34,443,059 Diluted 36,914,425 36,879,621 34,443,059 Components of share- based compensation expenses are included in the following expense captions: R&D (532) (437) (538) S&M (56) (52) (86) G&A (575) (437) (613) Total (1,163) (926) (1,237) Reconciliations of non-GAAP results of operations measures to the nearest comparable GAAP measures (*) (Amounts expressed in thousands of U.S. dollars, except per share data, unaudited) Three months ended March 31, 2010 GAAP Non-GAAP Result Adjustment Results Loss from operations (6,656) 1,163 (5,493) (Loss)/income attributed to Vimicro International Corporation (4,408) 1,163 (3,245) Diluted (loss)/income per ADS (0.12) 0.03 (0.09) Three months ended December 31, 2009 GAAP Non-GAAP Result Adjustment Results Loss from operations (4,352) 926 (3,426) (Loss)/income attributed to Vimicro International Corporation (600) 926 326 Diluted (loss)/income per ADS (0.02) 0.03 0.01 Three months ended March 31, 2009 GAAP Non-GAAP Result Adjustment Results Loss from operations (6,931) 1,237 (5,694) (Loss)/income attributed to Vimicro International Corporation (6,654) 1,237 (5,417) Diluted (loss)/income per ADS (0.19) 0.03 (0.16) (*) The adjustment is to exclude non-cash for share-based compensation for employees and non-employees. For further information about Vimicro, please contact: Investor Contacts: Jack Guo, Vice President of Investor Relations Phone: +86-10-6894-8888 x7379 Email: firstname.lastname@example.org Shelton Group Investor Relations Leanne K. Sievers, EVP Phone: +1-949-224-3874 Email: email@example.com
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