Quarterly Revenues Increased 29% YoY
SANTA CLARA, Calif., Apr 26 /PRNewswire-FirstCall/ -- DSP Group, Inc.
(Nasdaq: DSPG), a worldwide leader in developing and providing chip-set
solutions for residential wireless connectivity, announced today its
results for the first quarter ended March 31, 2006.
First Quarter Results:
Revenues for the first quarter of 2006 were $51,952,000, an increase of
29% from revenues of $40,163,000 for the first quarter of 2005. Net income
for the first quarter was $5,638,000, an increase of 13% from net income of
$5,007,000 for the first quarter of 2005. Diluted earnings per share (EPS)
for the first quarter of 2006 were $0.18, an increase of 6% from $0.17 for
the first quarter of 2005.
Pro Forma Results:
Pro forma net income and diluted EPS for the first quarter of 2006,
excluding the impact of equity-based compensation expense as required upon
adoption of Statement of Financial Accounting Standards No. 123R, "Share
Based Payment" ("SFAS 123(R)"), were $8,044,000 and $0.26, respectively,
representing an increase of 61% and 53% from the first quarter of 2005,
respectively.
Eli Ayalon, Chairman and CEO of DSP Group, stated: "The first quarter
of 2006 was another strong quarter for DSP Group, our revenues increased by
29% as compared to 2005, and the overall financial results of the Company
reflect the continued strength of our business. Moreover, strong demand for
our products during the first quarter of 2006, coupled with encouraging
forecasts from our marketing channels, give us good visibility into the
second quarter of 2006 and increase our confidence in the growth
projections of the company for 2006.
The Company believes that the pro forma presentation of net income and
diluted EPS presented in this press release is useful to investors in
comparing results for the quarter ended March 31, 2006 to the same period
during 2005, because results for the first quarter of 2005 did not include
equity-based compensation expenses relating to SFAS 123(R). Further, the
Company believes it is useful to investors to understand how the expenses
associated with the application of SFAS 123(R) are reflected on its
statements of income.
About DSP Group
DSP Group, Inc. is a fabless semiconductor company, offering advanced
chip-set solutions for a variety of applications. DSP Group is a worldwide
leader in the short-range wireless communication market, enabling home
networking convergence for voice, video & data. By combining its in-house
technologies of Digital Signal Processors (DSPs), portfolio of wireless
communication protocols, including DECT, Bluetooth and Wi-Fi, most advanced
Radio Frequency CMOS and SiGe, as well as VoIP ICs, DSP Group is a
worldwide leader and a one-stop-shop for a wide range of applications.
These applications include ISM band digital 900MHz, 2.4GHz and 5.8GHz
telephony, European DECT (1.9GHz) telephony, Bluetooth systems for voice,
data and video communication and deployment in residential, SOHO, SME,
enterprise and automotive applications. DSP Group ICs provide solutions for
MP3 players, VoIP Phones, Gateways, and Integrated Access Devices and are
widely used in Digital Voice Recorders. More information about DSP Group is
available at http://www.dspg.com.
This press release may contain statements that qualify as
"forward-looking statements" under the Private Securities Litigation Reform
Act of 1995, including statements made by Mr. Ayalon about DSP Group's good
visibility into the second quarter of 2006 and increased confidence in the
growth projections of the company for 2006." These forward-looking
statements are based on current expectations and DSP Group assumes no
obligation to update this information. In addition, the events described in
these forward-looking statements may not actually arise. DSP Group's actual
results could differ materially from those described in this press release
as a result of various factors, including slower than expected change in
the nature of the home communications domain, unexpected delays in the
introduction of new products, especially DECT products; failure to achieve
broad market acceptance of existing and new products by existing and
potential OEM customers; DSP Group's inability to add new customers and
develop and produce new products at competitive costs and in a timely
manner; decline or fluctuations in gross margins and the effect on revenues
and profitability; and general market demand for products that incorporate
DSP Group's technology in the market. These factors and other factors which
may affect future operating results or DSP Group's stock price are
discussed under "RISK FACTORS" in the Form 10-K for fiscal 2005 as well as
other reports DSP Group has filed with the Securities and Exchange
Commission and which are available on DSP Group's Web site (http://www.dspg.com)
under Investor Relations.
Earnings conference call
DSP Group has scheduled a conference call for 8:30 a.m. EDT today to
discuss the financial results for the first quarter of 2006 and invites you
to listen to a live broadcast over the Internet. The broadcast can be
accessed by all interested parties through the Investor Relations section
(investor message board) of DSP Group's Web site at http://www.dspg.com or link
to: http://ir.dspg.com./phoenix.zhtml?c=101665&p=irol-calendar
If you cannot join the call, please listen to the replay, which will be
available for approximately two weeks after the call on DSP Group's Web
site or by calling the following numbers:
-- US Dial-In # 1-888-286-8010 (passcode: 83495553)
-- International Dial-In # 1-617-801-6888 (passcode: 83495553)
For more information, please contact Ofer Elyakim, Director of Investor
Relations, DSP Group Inc. at 408-986-4421; or e-mail: ofere@dsp.co.il.
DSP GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
Three Months Ended
March 31,
2006 2005
Unaudited Unaudited
Product revenues and other $ 51,952 $ 40,163
Cost of product revenues and other 30,355 22,244
Gross profit 21,597 17,919
Operating expenses:
Research and development 10,901 9,399
Sales and marketing 3,806 2,886
General and administrative 2,800 1,865
Total operating expenses 17,507 14,150
Operating income 4,090 3,769
Other income:
Interest and other income, net 3,109 2,272
Income before provision for income taxes 7,199 6,041
Provision for income taxes 1,561 1,034
Net income $ 5,638 $ 5,007
Net earnings per share:
Basic $ 0.19 $ 0.18
Diluted $ 0.18 $ 0.17
Weighted average number of shares of
Common Stock used in the computation of:
Basic 29,477 28,113
Diluted 30,784 29,606
DSP GROUP, INC.
CONSOLIDATED PRO FORMA STATEMENTS OF INCOME
(In thousands, except per share amounts)
Three Months Ended
March 31,
2006 2005
Unaudited Unaudited
Product revenues and other $ 51,952 $ 40,163
Cost of product revenues and other 30,277 22,244
Gross profit 21,675 17,919
Operating expenses:
Research and development 9,679 9,399
Sales and marketing 3,538 2,886
General and administrative 1,875 1,865
Total operating expenses 15,092 14,150
Operating income 6,583 3,769
Other income:
Interest and other income, net 3,109 2,272
Income before provision for income taxes 9,692 6,041
Provision for income taxes 1,648 1,034
Net income $ 8,044 $ 5,007
Net earnings per share:
Basic $ 0.27 $ 0.18
Diluted $ 0.26 $ 0.17
Weighted average number of shares of
Common Stock used in the computation of:
Basic 29,477 28,113
Diluted 30,784 29,606
The above pro forma consolidated statements of income have been
adjusted to exclude the following to US GAAP reported net income:
Three Months Ended
March 31,
2006 2005
Unaudited Unaudited
Reported net income per US GAAP $ 5,638 $ 5,007
Adjustments:
Equity based compensation expense
included in cost of product revenues and
other 78 --
Equity based compensation expense
included in research and development 1,222 --
Equity based compensation expense
included in sales and marketing 268 --
Equity based compensation expense
included in general and administrative 925 --
Tax benefit resulting from equity based
compensation (87) --
Pro forma net income $ 8,044 $ 5,007
DSP GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, December 31,
2006 2005
(Unaudited) (Audited)
Assets
Current assets:
Cash and cash equivalents $ 67,443 $ 50,460
Marketable securities and cash deposits 131,129 108,928
Trade receivables, net 22,197 16,991
Inventories 15,869 12,686
Other accounts receivable 3,294 1,617
Deferred income taxes 1,313 1,227
Total current assets 241,245 191,909
Property and equipment, net 11,263 11,704
Long term marketable securities 176,281 185,828
Severance pay fund 4,670 4,419
Deferred income taxes 1,638 1,638
Other assets 4,220 4,507
Total assets $439,317 $400,005
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 19,639 $ 12,753
Other current liabilities 28,654 33,411
Total current liabilities 48,293 46,164
Accrued severance pay 4,863 4,707
Stockholders' equity:
Common Stock 30 29
Additional paid-in capital 205,122 188,539
Accumulated other comprehensive income (loss) (9) 45
Retained earnings 181,018 179,968
Less - Cost of treasury stock -- (19,447)
Total stockholders' equity 386,161 349,134
Total liabilities and stockholders' equity $439,317 $400,005
CONTACT:
Ofer Elyakim
Director of Investor Relations
DSP Group Inc.
+1-408-986-4421
ofere@dsp.co.il
(Photo: http://www.newscom.com/cgi-bin/prnh/20020715/SFM118LOGO )
SOURCE DSP Group, Inc.
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http://ir.dspg.com./phoenix.zhtml?c=101665&p=irol-calendar/
http://www.dspg.com/
Photo Notes:http://www.newscom.com/cgi-bin/prnh/20020715/SFM118LOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
Ofer Elyakim, Director of Investor Relations,
of DSP Group Inc., +1-408-986-4421; ofere@dsp.co.il
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