SAN JOSE, Calif., July 24 /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 second quarter ended June 30, 2008.
Second Quarter Results:
Revenues for the second quarter of 2008 were $74,152,000, an increase
of 41% from revenues of $52,436,000 for the second quarter of 2007. Net
loss for the second quarter of 2008 was $7,355,000 as compared to net
income of $2,964,000 for the second quarter of 2007. Diluted earnings per
share (EPS) for the second quarter of 2008 were a loss of $0.26 as compared
to earnings of $0.10 for the second quarter of 2007.
Non-GAAP Results:
Non-GAAP net income and diluted EPS for the second quarter of 2008 were
$1,019,000 and $0.04 per share, respectively; a decrease of 86% from the
non-GAAP net income of $7,171,000 and a decrease of 84% from non-GAAP
diluted EPS of $0.25 per share for the second quarter of 2007. Non-GAAP net
income and diluted EPS for the second quarter of 2008 excluded the impact
of amortization of acquired intangible assets of $5,716,000 associated with
the acquisition of the Cordless and VoIP Terminals business of NXP B.V.;
equity-based compensation expenses of $3,585,000; and the aggregate tax
benefits associated with such expenses of $927,000. Non-GAAP net income and
diluted EPS for the second quarter of 2007 excluded equity-based
compensation expenses of $3,708,000, a loss related to certain marketable
securities of $996,000 and aggregate tax benefits associated with such
expenses of $497,000.
Eli Ayalon, Chairman and CEO of DSP Group, stated: "Having achieved our
financial objectives for the second quarter 2008, the company continues to
focus and invest significant resources on its R&D effort to deliver a new
generation of products that we believe will ensure our future growth and
profitability."
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 and 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,
video and data communication and deployment in residential, SOHO, SME,
enterprise and automotive applications. DSP Group's 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.
Forward Looking Statements
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 R&D investments
in a new generation of products that DSP Group believes will ensure its
future growth and profitability. 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 greater or lesser than anticipated decrease in
sales of DSP Group's 5.8GHz products or growth in sales of DSP Group's DECT
6.0 products; slower than expected change in the nature of the residential
communications domain; unexpected delays in the introduction of new
products or failure of such products to achieve broad market acceptance;
DSP Group's inability develop and produce new products at competitive
costs; 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 2007 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 second quarter of 2008 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: 63682958)
-- International Dial-In # 1-617-801-6888 (passcode: 63682958)
For more information, please contact Ofer Elyakim, DSP Group Inc. at
+852-9017-5426; or e-mail: ofere@dsp.co.il.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020715/SFM118LOGO)
DSP GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
(Unaudited) (Unaudited)(Unaudited) (Unaudited)
Product revenues and
other $74,152 $52,436 $146,881 $101,723
Cost of product revenues and
other 48,183 31,233 93,959 61,233
Gross profit 25,969 21,203 52,922 40,490
Operating expenses:
Research and development 18,890 12,465 38,916 25,221
Sales and marketing 5,621 4,110 11,642 8,307
General and
administrative 4,547 3,328 8,798 6,925
Amortization of intangible
assets 5,716 - 11,498 -
Total operating expenses 34,774 19,903 70,854 40,453
Operating income/(loss) (8,805) 1,300 (17,932) 37
Other income :
Interest and other
income, net 898 2,927 2,132 6,579
Income/(loss) before
provision for income taxes (7,907) 4,227 (15,800) 6,616
Provision for income taxes/
(income tax benefit) (552) 1,263 (838) 2,288
Net income/(loss) ($7,355) $2,964 ($14,962) $4,328
Net earnings (loss) per
share:
Basic ($0.26) $0.10 ($0.51) $0.15
Diluted ($0.26) $0.10 ($0.51) $0.15
Weighted average number
of shares of Common stock
used in the computation of:
Basic 28,352 28,257 29,463 28,356
Diluted 28,352 28,469 29,463 28,580
DSP GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME (NON-GAAP)
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Product revenues and
other $74,152 $52,436 $146,881 $101,723
Cost of product revenues
and other 47,936 31,066 93,455 60,900
Gross profit 26,216 21,370 53,426 40,823
Operating expenses:
Research and development 16,998 10,536 34,933 21,205
Sales and marketing 5,192 3,663 10,706 7,420
General and
administrative 3,530 2,163 6,676 4,299
Total operating expenses 25,720 16,362 52,315 32,924
Operating income 496 5,008 1,111 7,899
Other income :
Interest and other
income, net 898 3,923 2,132 7,575
Income before provision for
income taxes 1,394 8,931 3,243 15,474
Provision for income taxes 375 1,760 784 2,970
Net income $1,019 $7,171 $2,459 $12,504
Net earnings per share:
Basic $0.04 $0.25 $0.08 $0.44
Diluted $0.04 $0.25 $0.08 $0.44
Weighted average number
of shares of Common stock
used in the computation of:
Basic 28,352 28,257 29,463 28,356
Diluted 28,373 28,469 29,565 28,580
Unaudited Reconciliation of GAAP to Pro Forma Non-GAAP Financial Measures
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
Unaudited Unaudited Unaudited Unaudited
GAAP net income (loss) ($7,355) $2,964 ($14,962) $4,328
Equity-based compensation
expense included in cost of
product revenues and other 247 167 504 333
Equity-based compensation
expense included in R&D 1,892 1,929 3,983 4,016
Equity-based compensation
expense included in SG&A 1,446 1,612 3,058 3,513
Amortization of intangible
assets related to NXP
transaction 5,716 - 11,498 -
Loss related to certain
marketable securities - 996 - 996
Tax benefit resulting from
equity-based compensation,
amortization of intangible
assets and from loss related
to certain marketable
securities (927) (497) (1,622) (682)
Pro Forma net income $1,019 $7,171 $2,459 $12,504
Pro Forma diluted earnings
per share $0.04 $0.25 $0.08 $0.44
DSP GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30, December 31,
2008 2007
(Unaudited) (Audited)
Assets
Current assets:
Cash and cash equivalents $56,645 $69,586
Restricted deposits 115 -
Marketable securities and cash deposits 16,239 63,682
Trade receivables, net 46,575 51,636
Inventories 19,514 16,361
Other accounts receivable 13,064 8,173
Deferred income taxes 2,014 4,011
Total current assets 154,166 213,449
Property and equipment, net 17,090 14,270
Long term marketable securities 48,929 34,469
Severance pay fund 8,031 6,883
Deferred income taxes 6,548 5,109
Goodwill and other intangible assets 227,354 237,969
Other assets 1,814 694
Total assets $463,932 $512,843
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $33,356 $29,064
Other current liabilities 39,088 48,125
Total current liabilities 72,444 77,189
Accrued severance pay 8,249 7,303
Accrued pensions 1,917 1,758
Deferred tax liability 871 372
Other long term liabilities 455 1,364
Total long term liabilities 11,492 10,797
Stockholders' equity:
Common stock 28 31
Additional paid-in capital 308,090 300,542
Accumulated other comprehensive income 1,327 1,025
Retained earnings 171,298 187,063
Less - Cost of treasury stock (100,747) (63,804)
Total stockholders' equity 379,996 424,857
Total liabilities and stockholders' equity $463,932 $512,843
SOURCE DSP Group, Inc.
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Related links:
http://www.dspg.com
Photo Notes:
NewsCom: http://www.newscom.com/cgi-bin/prnh/20020715/SFM118LOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
Ofer Elyakim of DSP Group Inc.,
+852-9017-5426, ofere@dsp.co.il
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