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Actions Semiconductor Reports Second Quarter 2012 Results

Revenue Increases 21% Year-Over-Year

Company Announces Increase to its Share Repurchase Program

Aug 7, 2012

ZHUHAI, China, Aug. 7, 2012 /PRNewswire-Asia/ -- Actions Semiconductor Co., Ltd. (Nasdaq: ACTS), one of China's leading fabless semiconductor companies that provides comprehensive portable multimedia and mobile internet system-on-a-chip (SoC) solutions for portable consumer electronics, today reported its financial results for the second quarter ended June 30, 2012.

All financial results are reported on a U.S. GAAP basis.

Revenue for the second quarter of 2012 was $12.6 million, as compared to revenue of $10.7 million for the first quarter of 2012, and $10.5 million for the second quarter of 2011. 

Net loss attributable to Actions Semiconductor's shareholders for the second quarter of 2012 was $0.56 million or $0.01 per ADS. This compares to net loss attributable to Actions Semiconductor's shareholders of $0.65 million or $0.01 per ADS, for the first quarter of 2012, and net income attributable to Actions Semiconductor's shareholders of $0.51 million or $0.01 per ADS, for the second quarter of 2011. 

Actions Semiconductor reported gross margin of 37.0% for the second quarter of 2012, compared to gross margin of 34.9% for the first quarter of 2012, and 37.9% for the second quarter of 2011. The Company ended the second quarter with $58.9 million in cash and cash equivalents.  Trading securities and marketable securities, current and non-current, were $160.0 million at the end of the second quarter. 

Since the share repurchase program commenced in 2007, the Company has invested approximately $43.9 million in repurchasing its shares.  As of June 30, 2012, approximately 19.1 million American Depositary Shares (ADSs) were repurchased. The Company's Board of Directors today authorized an increase to 30 million ADSs from 20 million ADSs for the share repurchase program. 

"Our second quarter results were in line with expectations and demonstrated sequential and year over year revenue growth," stated Dr. Zhenyu Zhou, CEO of Actions Semiconductor.  "Our more value-oriented solutions such as automotive products continued to comprise the largest portion of our product mix during the quarter.  At the same time, we maintained a leading market share position in our mainstream portable video and portable audio products. 

"As we move through the second half of the year we remain focused on leveraging our strong product portfolio to extend our leadership position in established markets, while concentrating our efforts on penetrating the mobile Internet enabled multimedia tablet market.  We have been increasing shipment volumes of our recently launched tablet product and continue to expect to see a contribution from this new product in the second half of 2012," concluded Dr. Zhou.

Business Outlook

The following statements are based upon management's current expectations. These statements are forward-looking, and actual results may differ materially. The Company undertakes no obligation to update these statements.

For the third quarter of fiscal year 2012 ending September 30, 2012, Actions Semiconductor estimates revenue in the range of $15.5 to $16.5 million and gross margin of approximately 37%.

Conference Call Details

Actions Semiconductor's second quarter 2012 teleconference and webcast is scheduled to begin at 5:30 p.m. Eastern Time, on Tuesday, August 7, 2012. To participate in the live call, analysts and investors should dial 877-941-4774 (within U.S.) or 480-629-9760 (outside U.S.) at least ten minutes prior to the call. Actions Semiconductor will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the company's website at www.actions-semi.com.  An audio replay of the call will be available to investors through August 17, 2012 by dialing 800-406-7325 (within U.S.) or 303-590-3030 (outside U.S.) and entering access code 4553189.

About Actions Semiconductor

Actions Semiconductor is one of China's leading fabless semiconductor companies that provides comprehensive portable multimedia and mobile internet system-on-a-chip (SoC) solutions for portable consumer electronics. Actions Semiconductor products include SoCs, firmware, software, solution development kits, as well as detailed specifications of other required components. Actions Semiconductor also provides total product and technology solutions that allow customers to quickly introduce new portable consumer electronics to the mass market in a cost effective way. The company is headquartered in Zhuhai, China, with offices in Beijing, Shanghai, and Shenzhen. For more information, please visit the Actions Semiconductor website at http://www.actions-semi.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995

Statements contained in this release that are not historical facts are forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements concerning signs of positive indicators in the industry for next year, growth in the market driven by continued proliferation of applications within the PMP market and incremental rebound of overall demand for these products, Actions Semiconductor's belief that it is positioned to capture some upside from these trends, and Actions Semiconductor's future expectations with respect to revenue, gross margin, operating expenses and share-based compensation expense.  Actions Semiconductor uses words like "believe," "anticipate," "intend," "estimate," "expect," "project" and similar expressions to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements are estimates reflecting current assumptions, expectations and projections about future events and involve significant risks, both known and unknown, uncertainties and other factors that may cause Actions Semiconductor's actual performance, financial condition or results of operations to be materially different from those suggested by the forward-looking statements including, among others, customers' cancellation or modification of their orders; our failure to accurately forecast demand for our products; the loss of, or a significant reduction in orders from, any of our significant customers; fluctuations in our operating results; our inability to develop and sell new products; defects in or failures of our products; the expense and uncertainty involved in our customer design-win efforts; the financial viability of the distributors of our products; consumer demand; worldwide economic and political conditions; fluctuations in our costs to manufacture our products; our reliance on third parties to manufacture, test, assemble and ship our products; our ability to retain and attract key personnel; our ability to compete with our competitors; and our ability to protect our intellectual property rights and not infringe the intellectual property rights of others. Other factors that may cause our actual results to differ from those set forth in the forward-looking statements contained in this press release and that may affect our prospects in general are described in our filings with the Securities and Exchange Commission, including our most recently filed Forms F-1, 20-F and 6-Ks. Other unknown or unpredictable factors also could have material adverse effects on Actions Semiconductor's future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this press release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this press release. Except as required by law, Actions Semiconductor undertakes no obligation and does not intend to update or revise any forward-looking statement to reflect subsequent events or changed assumptions or circumstances.

Investor Contacts:


Lisa Laukkanen                                     

Edward Chen

The Blueshirt Group                              

Investor Relations at Actions Semiconductor

lisa@blueshirtgroup.com                      

edward@actions-semi.com

415-217-4967                                        

+86-756-3392353*1110


ACTIONS SEMICONDUCTOR CO., LTD.


CONSOLIDATED CONDENSED BALANCE SHEET


(in thousands of U.S. dollars)










At June 30,


At March 31,


At December 31,



2012


2012


2011



(unaudited)


(unaudited)


(audited)


ASSETS







Current assets:







  Cash and cash equivalents

58,876


33,795


33,207


  Marketable securities

148,843


187,223


186,890


  Trading securities

80


545


530


  Accounts receivable, net of allowance for      doubtful accounts of $621, $621 and $621      as of June 30, 2012, March 31, 2012 and      December 31, 2011, respectively

2,098


1,869


2,794


  Amount due from a related party

182


34


9


  Amount due from an equity method investee

70


114


64


  Inventories

10,606


6,981


7,477


  Prepaid expenses and other current assets

2,878


1,402


1,675


  Deferred tax assets

414


403


430


Total current assets

224,047


232,366


233,076









  Investments in equity method investees

14,215


14,208


14,246


  Other investments 

17,335


17,340


17,334


  Marketable securities

11,067


-


-


  Rental deposits

43


52


49


  Property, plant and equipment, net

32,571


33,034


32,939


  Land use right

1,578


1,595


1,593


  Acquired intangible assets, net

9,002


9,293


9,859


  Deferred tax assets

87


11


27


TOTAL ASSETS

309,945


307,899


309,123









LIABILITIES AND EQUITY







Current liabilities:







  Accounts payable

8,285


5,007


4,374


  Accrued expenses and other current liabilities

5,945


5,543


8,605


  Short-term bank loan

12,000


12,000


12,000


  Other liabilities

2,325


1,999


1,954


  Income tax payable

202


357


238


  Deferred tax liabilities

421


446


295


Total current liabilities

29,178


25,352


27,466









Other liabilities

6


461


458


Payable for acquisition of intangible assets

153


153


153


Deferred tax liabilities

2,925


2,912


2,840


Total liabilities

32,262


28,878


30,917


Equity:







 Ordinary shares

1


1


1


 Additional paid-in capital

20,902


20,806


20,600


 Accumulated other comprehensive income

32,978


33,851


32,589


 Retained earnings

223,829


224,388


225,037


Total Actions Semiconductor Co., Ltd. shareholders' equity

277,710


279,046


278,227


Non-controlling interest

(27)


(25)


(21)


Total equity

277,683


279,021


278,206


TOTAL LIABILITIES AND EQUITY

309,945


307,899


309,123


 

ACTIONS SEMICONDUCTOR CO., LTD.


CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS


(in thousands of U.S. dollars, except per share amounts)














Three months ended


Three months ended


Six months ended


Six months ended




June 30,


June 30,


June 30,


June 30,




2012


2011


2012


2011




  (unaudited)  


  (unaudited)  


  (unaudited)  


  (unaudited)  












Revenues:










  Third-parties:










  System-on-a chip products


12,195


8,679


22,698


15,703


  Semiconductor product testing services


25


99


86


179




12,220


8,778


22,784


15,882


  Related-parties:










   System-on-a-chip products


423


1,699


594


3,961


  Total revenues


12,643


10,477


23,378


19,843


Cost of revenues:










  Third-parties:










   System-on-a-chip products


(7,697)


(5,492)


(14,533)


(9,841)


   Semiconductor product testing services


(13)


(54)


(51)


(96)




(7,710)


(5,546)


(14,584)


(9,937)


  Related-parties:










   System-on-a-chip products


(254)


(960)


(368)


(2,269)


  Total cost of revenues


(7,964)


(6,506)


(14,952)


(12,206)


Gross profit


4,679


3,971


8,426


7,637


Other operating income


119


405


191


622


Operating expenses:










  Research and development


(5,557)


(5,590)


(11,339)


(10,647)


  General and administrative


(2,096)


(2,226)


(3,872)


(3,921)


  Selling and marketing


(301)


(327)


(550)


(592)


Total operating expenses


(7,954)


(8,143)


(15,761)


(15,160)


Loss from operations


(3,156)


(3,767)


(7,144)


(6,901)


Other (expenses) income


(445)


1,316


94


2,427


Dividend income from an other investment


-


432


-


432


Fair value change in financial instruments


1


1


2


2


Interest income


3,118


3,025


6,565


5,857


Interest expense


(62)


(32)


(123)


(51)


(Loss) income before income taxes, equity in net income (loss) of equity method investees and non-controlling interest


(544)


975


(606)


1,766


Income tax expense


(38)


(136)


(574)


(394)


Equity in net income (loss) of equity method investees


21


(327)


(34)


(858)


Net (loss) income


(561)


512


(1,214)


514


Less: Net loss attributable to non-controlling interest


2


-


6


3


Net (loss) income attributable to Actions Semiconductor  Co., Ltd.

(559)


512


(1,208)


517












Net (loss) income per share: Basic










Net (loss) income attributable to Actions Semiconductor  Co., Ltd. Shareholders

(0.001)


0.001


(0.003)


0.001












Net (loss) income per share: Diluted










Net (loss) income attributable to Actions Semiconductor  Co., Ltd. Shareholders

(0.001)


0.001


(0.003)


0.001












Basic (per ADS)


(0.008)


0.007


(0.018)


0.007


Diluted (per ADS)


(0.008)


0.007


(0.018)


0.007












Weighted-average shares used in computation:










Basic


414,249,548


417,488,882


414,123,803


420,101,361


Diluted


414,249,548


433,424,029


414,123,803


436,864,716












Weighted-average ADS used in computation :










Basic


69,041,591


69,581,480


69,020,634


70,016,894


Diluted


69,041,591


72,237,338


69,020,634


72,810,786












Note: Equity compensation recorded in each










expense classification above is as follows:










  Research and development


333


517


687


964


  General and administrative


95


141


193


264


  Selling and marketing


17


25


32


49


  Cost of revenues


4


11


10


16


 

ACTIONS SEMICONDUCTOR CO., LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands of U.S. dollars)


Three months ended


Six months ended


Six months ended


June 30,


June 30,


June 30,


2012


2012


2011


(unaudited)


  (unaudited)  


  (unaudited)  

Operating activities:






Net (loss) income 

(561)


(1,214)


514

Adjustments to reconcile net (loss) income to net cash provided by






  Operating activities:






  Depreciation of property, plant and equipment

591


1,183


903

  Amortization of land use right

9


18


18

  Amortization of acquired intangible assets

720


1,426


778

  Utilization of subsidy from local authorities of Zhuhai, the    People's Republic of China ("PRC")

(122)


(122)


(523)

  Write down of inventories

103


180


167

  Loss (gain) on disposal of property, plant and equipment 

15


(3)


7

  Loss on disposal of intangible assets

-


-


2

  Gain on disposal of other investment

-


-


(195)

  Share of net (income) loss of equity method investees

(21)


34


859

  Share-based  compensation

449


922


1,293

  Fair value change in trading securities

(1)


(2)


(2)

  Deferred taxes

(99)


167


365

  Proceeds from disposal of trading securities

459


459


-

  Changes in operating assets and liabilities:






    Accounts receivable

(231)


695


69

    Amount due from a related party

(148)


(173)


247

    Inventories

(3,756)


(3,295)


(3,298)

    Amount due from an equity method investee

44


(6)


17

    Prepaid expenses and other current assets

(1,488)


(1,204)


(233)

    Accounts payable

3,296


3,904


3,928

    Accrued expenses and other current liabilities

423


(2,688)


3,885

    Income tax payable

(154)


(36)


(45)

    Rental deposit received (paid)

9


9


(8)

Net cash (used in) provided by operating activities

(463)


254


8,748







Investing activities:






  Increase in an equity method investees

-


-


(9,676)

  Proceeds from the disposal of other investments

-


-


195

  Purchase of other investments

-


-


(13,727)

  Proceeds from redemption of marketable securities

100,353


120,008


230,679

  Purchase of marketable securities

(73,552)


(92,831)


(225,646)

  Proceeds from disposal of property, plant and equipment

-


22


1

  Purchase of property, plant and equipment

(300)


(772)


(11,068)

  Purchase of intangible assets

(472)


(547)


(1,154)

  Increase in restricted cash

-


-


(36)

  Decrease in time deposits 

-


-


34

Net cash from (used in)  investing activities

26,029


25,880


(30,398)







Financing activities:






  Proceeds from short-term bank loans

-


-


12,000

  Advance subsidy from local authorities of Zhuhai, the PRC

6


38


16

   Proceeds from exercise of stock option

1,040


1,799


376

   Repurchase of ordinary shares

(1,393)


(2,418)


(4,701)

Net cash (used in) from financing activities

(347)


(581)


7,691







Net increase (decrease) in cash and cash equivalents

25,219


25,553


(13,959)







Cash and cash equivalents at the beginning of the period

33,795


33,207


42,872







Effect of exchange rate changes on cash

(138)


116


1,806

Cash and cash equivalents at the end of the period

58,876


58,876


30,719

SOURCE Actions Semiconductor Co., Ltd.


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