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O2Micro Reports Fourth Quarter and Fiscal 2015 Financial Results

GEORGE TOWN, Grand Cayman, Jan. 27, 2016 (GLOBE NEWSWIRE) --

Operational and Strategic Highlights
:

  • O2Micro continues to lower operating expenses. Company lowers fiscal year 2015 operating expenses by $7.4 million on a year-over-year basis
  • Lower operating expense levels reflect new cash breakeven level estimate of $16.5-$17.5 million and new profitability breakeven level estimate of $18.5-$19.5 million on a quarterly basis
  • Expects revenue to be down 5 percent to up two percent sequentially in the first quarter of fiscal year 2016

O2Micro® International Limited (NASDAQ:OIIM), a global leader in the design, development and marketing of high-performance integrated circuits and solutions, reported its financial results today for the fourth quarter and fiscal year 2015, ending December 31, 2015.

Financial Highlights for the Fourth Quarter ending December 31, 2015:

O2Micro International Limited reported Q4 2015 revenue of $13.4 million. Revenue was down 2% sequentially and down 7% from the comparable year-ago quarter. The gross margin in the fourth quarter of 2015 was 50.4%. The gross margin was down from 52.0% in the prior quarter and down from 51.0% in the fourth quarter of 2014. The gross margin remains in our target range and varies primarily with revenue level and product mix. During the fourth quarter of 2015, the company recorded total GAAP operating expenses of $11.3 million, compared to $10.5 million in the third quarter of 2015 and $14.4 million in the year-ago Q4 period. The respective GAAP operating margins for the fourth quarter of 2015, the third quarter of 2015, and fourth quarter of 2014 were (34.1%), (25.0%), and (49.2%).

GAAP net loss was $12.8 million in Q4 2015. This compares to a GAAP net loss of $2.4 million in the third quarter of 2015 and a GAAP net loss of $6.0 million in Q4 2014. GAAP net loss per fully diluted ADS was $0.50 in Q4 2015. This compares to a GAAP net loss per fully diluted ADS of $0.09 in Q3 2015 and a GAAP net loss per fully diluted ADS of $0.23 in Q4 2014.

Financial Highlights for the Twelve Months ending December 31, 2015:

O2Micro International Limited produced revenue of $54.8 million in 2015. Revenue was down by 13.8% from 2014 when the company reported revenue of $63.6 million. The gross margin in 2015 was 50.5%, compared to 51.5% in 2014. GAAP operating expenses totaled $42.1 million and $49.6 million in 2015 and 2014, respectively. The GAAP operating loss was $14.4 million in 2015 compared to a GAAP operating loss of $16.8 million in 2014. The corresponding GAAP operating margins were (26.3%) and (26.5%) in 2015 and 2014, respectively. Pretax loss from continuing operations was $16.5 million in 2015, compared to a pretax loss from continuing operations of $13.9 million in 2014. GAAP net loss in 2015 was $21.1 million, compared to a GAAP net loss of $15.1 million in 2014. The corresponding GAAP net loss per fully diluted ADS was $0.81 in 2015, compared to a GAAP net loss per fully diluted ADS of $0.55 in 2014.

Supplementary Data:

The company ended the fourth quarter of 2015 with $52.4 million in unrestricted cash and short-term investments or $2.05 per outstanding ADS. The accounts receivable balance was $5.2 million and represented 41 days sales outstanding at the end of Q4 2015. Inventory was $9.7 million or 128 days and turned over 2.8 times during Q4 2015. As of December 31, 2015, the company had $57.7 million in working capital and the book value was $83.1 million, or $3.25 per outstanding ADS.

As of December 31, 2015, O2Micro International Limited counted 357 employees, including 194 engineers.

Management Commentary:

“We are very confident that our targets of penetrating the high end 4K TV market and the white-box smartphone and tablet markets, coupled with ongoing growth in our carefully chosen growth drivers including LED general lighting products and battery management products for the power tool market, will contribute to top-line growth in upcoming quarters and lead O2Micro back to profitability in the near future,” said Sterling Du, O2Micro’s Chairman and CEO. “Meanwhile, we are taking the necessary steps to focus our resources on our key customer accounts and key markets, as well as being financially focused on expense reduction management. “

Conference Call: O2Micro will hold its fourth quarter conference call today, January 27, 2016, at 6:00 a.m. PST, 9:00 a.m. EST. You may participate using the following dial-in information.

In the US and CANADA: 800-499-4035, pass code #4400544
INTERNATIONAL participants: 416-204-9269, pass code #4400544

A replay of the call will be available by phone for one week following the live call. The replay can be accessed using the following dial-in information.

In the US and CANADA: 888-203-1112, pass code #4400544
INTERNATIONAL participants: 719-457-0820, pass code #4400544

A live webcast will also be available on the company website at www.o2micro.com, and an online replay will be available for one week.

About O2Micro

Founded in April 1995, O2Micro develops and markets innovative power management components for the Computer, Consumer, Industrial, Automotive and Communications markets. Products include LED General Lighting, Backlighting, Battery Management and Power Management.

O2Micro International maintains an extensive portfolio of intellectual property with over 1,600 patents issued Worldwide, and over 33,000 patent claims granted. The company maintains offices worldwide. Additional company and product information can be found on the company website at www.o2micro.com.

O2Micro, the O2Micro logo, and combinations thereof are registered trademarks of O2Micro. All other trademarks or registered trademarks are the property of their respective owners.

Statements made in this release that are not historical, including statements regarding O2Micro or its management's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal Securities Laws. Such statements involve risks, speculation and uncertainties that may cause actual results to differ materially from those set forth in these statements or from management’s current views and expectations. Risks and uncertainties in this release may include, without limitation, any one or combination of the following: the effect of competitive and economic factors; real property value fluctuations and market demand; legal changes in any relevant rules and regulations pertaining to O2Micro’s business; changes in technology and industry standards, and O2Micro’s reaction to those factors; consumer and business buying decisions with respect to our customers’ products incorporating O2Micro’s products; continued competitive pressures in the marketplace; the ability of O2Micro to deliver to the marketplace, and stimulate customer demand therein, for new products and technological innovations on a timely basis; the effect that product introductions and transitions, changes in product pricing or mix, and/or increases in component costs could have on O2Micro’s gross margins; the inventory risk associated with O2Micro’s need to order, or commit to order, product components and product capacity in advance of forecast customer orders; the continued availability of acceptable terms of certain components and services essential to O2Micro’s business which are currently obtained by the company from sole or limited sources; the effect that O2Micro’s dependency on manufacturing and logistics services provided by third parties may have on the quality, quantity, availability or cost of products manufactured or services rendered; risks associated with O2Mcro’s international operations; the potential impact of a finding that O2Micro has infringed on the intellectual property rights of others, or that any third party may have infringed on O2Micro’s intellectual property that may negatively affect O2Micro’s business; O2Micro’s legal classifications with governmental and regulatory agencies; O2Micro’s dependency on the performance of distributors, carriers, independent sales representatives, and other resellers of O2Micro’s products; the effect that product and service quality problems could have on O2Micro’s sales ability and operating profits; the ability of O2Micro to deliver its products in a timely fashion to its customers, and the possible negative ramifications if such is not possible; the continued service and availability of key executives and employees; war, terrorism, public health issues, natural disasters, and other circumstances that could disrupt supply, delivery, or demand of products; and unfavorable results of other legal proceedings.

Actual results may differ materially due to numerous risk factors. Such risk factors are more fully enumerated in O2Micro’s 20-F Annual Filings, Annual Report(s), 6-K’s, the Form F-1 filed in connection with the company’s initial public offering in August 2000, information posted on our website at www.o2micro.com, and other documents filed with the SEC, NASDAQ or any other public agency from time to time. The statements herein are based on dated information on the dates mentioned herein, which is subject to change. O2Micro assumes no obligation to update or revise the information provided on today, or any other forward-looking information, whether as a result of new information, future events or any other information that may arise. This information only speaks to the respective dates mentioned in said information.


O2MICRO INTERNATIONAL LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(In Thousand U.S. Dollars, Except Per Share Amounts)
Three Months EndedYears Ended
December 31, December 31,
2015 2014 2015 2014
(Unaudited)(Unaudited)(audited)
NET SALES$ 13,379 $ 14,330 $ 54,841 $ 63,591
COST OF SALES 6,636 7,028 27,145 30,856
GROSS PROFIT 6,743 7,302 27,696 32,735
OPERATING EXPENSES
Research and development (1) 5,487 8,296 18,493 24,625
Selling, general and administrative (1) 5,814 6,057 23,632 24,933
Total Operating Expenses 11,301 14,353 42,125 49,558
LOSS FROM OPERATIONS (4,558) (7,051) (14,429) (16,823)
NON-OPERATING INCOME
Interest income 106 244 681 1,035
Foreign exchange gain – net 39 415 730 589
Impairment loss on long-term investments (4,953) - (4,953) -
Gain on sale of real estate - 458 767 458
Other – net 394 375 749 868
Total Non-operating Income (Loss) (4,414) 1,492 (2,026) 2,950
LOSS BEFORE INCOME TAX (8,972) (5,559) (16,455) (13,873)
INCOME TAX EXPENSE 3,825 450 4,640 1,184
NET LOSS (12,797) (6,009) (21,095) (15,057)
OTHER COMPREHENSIVE INCOME
Foreign currency translation adjustments (192) (696) (1,945) (1,416)
Unrealized loss on available-for-sale securities - (166 ) - (398)
Unrealized pension (loss) gain (4) 65 1 70
Total Other Comprehensive Loss (196) (797) (1,944) (1,744)
COMPREHENSIVE LOSS$(12,993) $ (6,806) $ (23,039) $ (16,801)
BASIC AND DILUTED LOSS PER ADS$ (0.50) $ (0.23) $ (0.81) $ (0.55)
ADS UNITS USED IN LOSS PER ADS CALCULATION:
Basic (in thousands) 25,627 26,690 26,029 27,249
Diluted (in thousands) 25,627 26,690 26,029 27,249
(1) INCLUDES STOCK-BASED COMPENSATION CHARGE AS FOLLOWS:
Research and development$ 76 $ 99 $ 322 $ 489
Selling, general and administrative$ 388 $ 399 $ 1,590 $ 1,631



O2MICRO INTERNATIONAL LIMITED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousand U.S. Dollars, Except Share Amounts)
December 31,December 31,
2015 2014
ASSETS(Unaudited)(Audited)
CURRENT ASSETS
Cash and cash equivalents$ 41,199 $ 41,069
Restricted cash 31 164
Short-term investments 11,233 21,481
Accounts receivable – net 5,197 6,789
Inventories 9,662 8,642
Prepaid expenses and other current assets 1,126 1,308
Assets held for sale 1,956 -
Total Current Assets 70,404 79,453
LONG-TERM INVESTMENTS 9,304 14,754
PROPERTY AND EQUIPMENT – NET 14,011 19,363
OTHER ASSETS 2,489 3,168
TOTAL ASSETS$ 96,208 $ 116,738
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Notes and accounts payable$ 3,333 $ 2,131
Income tax payable 2,245 650
Accrued expenses and other current liabilities 7,102 6,049
Total Current Liabilities 12,680 8,830
OTHER LONG-TERM LIABILITIES
Accrued pension liabilities 272 293
Other liabilities 139 349
Total Other Long-Term Liabilities 411 642
Total Liabilities 13,091 9,472
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY
Preference shares at $0.00002 par value per share
Authorized – 250,000,000 shares - -
Ordinary shares at $0.00002 par value per share
Authorized – 4,750,000,000 shares
Issued – 1,660,786,600 shares
Outstanding –1,278,661,400 and 1,327,260,450 shares as of December 31, 2015 and 2014, respectively
33 33
Additional paid-in capital 141,886 141,229
Accumulated deficits (38,386) (17,291)
Accumulated other comprehensive income 4,824 6,768
Treasury stock – 382,125,200 and 333,526,150 shares as of December 31, 2015 and
2014, respectively
(25,240) (23,473 )
Total Shareholders’ Equity 83,117 107,266
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$ 96,208 $ 116,738


Contact Information: Scott L. Anderson Director of Investor Relations, O2Micro Phone: 408.987.5920, x8888 Email: scott.anderson@o2micro.com

Source:O2Micro, Inc.