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MEMSIC Announces Third-Quarter 2010 Results

Pursuant to the requirements of Regulation G, we have provided a reconciliation of EBITDA to GAAP net income as an exhibit to this release.

About MEMSIC, Inc.

MEMSIC Inc., headquartered in Andover, Massachusetts, provides advanced semiconductor sensors and multi-sensor system solutions based on micro-electromechanical systems (MEMS) technology and sophisticated integration technologies in both the IC level and module level. MEMSIC's unique and proprietary approach combines leading-edge sensor technologies, such as magnetic sensors and accelerometers, with mixed signal processing circuitry to produce reliable, high quality, cost-effective solutions for the mobile phone, automotive, consumer, industrial, and general aviation markets. The company shares are listed on the NASDAQ Stock Exchange (NASDAQ GM: MEMS).

Safe Harbor Statement

Statements included in this press release that are not historical in nature are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of the company's management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements for reasons identified under the heading "Risk Factors" in the company's most recent annual report on Form 10-K and other periodic reports filed with the Securities and Exchange Commission. The forward-looking statements contained in this press release are made as of the date hereof, and the company does not undertake any obligation to update any forward-looking statements, whether as a result of future events, new information or otherwise.

 
 
MEMSIC, Inc.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
  September 30,   December 31,
2010   2009
 
ASSETS
Current assets:
Cash and cash equivalents $ 56,756,071 $ 66,970,736
Restricted cash 2,614,515 863,439
Short-term investments 500,000 -
Accounts receivable, net of allowance for doubtful accounts of $6,441
as of September 30, 2010 and December 31, 2009, respectively 4,048,875 2,670,144
Inventories 6,896,596 4,988,611
Other assets   2,698,129     1,004,458  
Total current assets 73,514,186 76,497,388
 
Property and equipment, net 21,922,331 14,591,828
Long-term investments 5,020,000 5,353,000
Goodwill 4,869,599 -
Intangible assets, net 12,113,093 988,270
Other assets   84,191     81,455  
Total assets $ 117,523,400   $ 97,511,941  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,327,157 $ 1,115,694
Accrued expenses 3,126,004 1,662,518
Advance research funding   2,614,515     863,439  
Total current liabilities 10,067,676 3,641,651
 
 
Note payable to bank 17,930,000 -
 
Stockholders’ equity:
 

Common stock, $0.00001 par value; authorized, 45,000,000 shares; 23,805,363 and 23,793,113shares issued and outstanding at September 30, 2010 and December 31, 2009, respectively

238 238
 
Additional paid-in capital 99,233,128 98,112,408
Accumulated other comprehensive income 2,615,109 2,218,496
Accumulated deficit   (12,686,178 )     (6,460,852 )
MEMSIC, Inc. stockholders' equity 89,162,297 93,870,290
 
Noncontrolling interest related to joint venture in Japan   363,427     -  
Total equity   89,525,724     93,870,290  
 
Total liabilities and stockholders’ equity $ 117,523,400     $ 97,511,941  
         
 
MEMSIC, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 
Three Months Ended September 30,

Nine Months Ended September 30,

2010 2009 2010 2009
 
Net sales $ 10,844,719 $ 7,067,583 $ 27,212,338 $ 22,759,693
Cost of goods sold   6,751,194     4,147,180     16,584,892     12,505,427
Gross profit 4,093,525 2,920,403 10,627,446 10,254,266
 
Operating expenses:
Research and development 2,377,649 1,210,197 6,386,394 4,088,923
Sales and marketing 1,376,893 502,829 3,557,223 1,622,890
General and administrative 2,212,399 1,342,290 6,525,484 4,115,447
Amortization expense   406,561     38,067     1,146,844     110,012
Total operating expenses   6,373,502     3,093,383     17,615,945     9,937,272
 
Operating income (loss) (2,279,977 ) (172,980 ) (6,988,499 ) 316,994
 
Other income:
Interest and dividend income 99,026 205,322 319,803 665,171
Other, net   325,074     68,651     430,361     107,286
Total other income   424,100     273,973     750,164     772,457
 
Earnings (loss) before income taxes (1,855,877 ) 100,993 (6,238,335 ) 1,089,451
Provision (benefit) for income taxes   36,392     48,927     (79,102 )   289,021
Net income (loss) (1,892,269 ) 52,066 (6,159,233 ) 800,430
 
Less: net income attributable to noncontrolling interest   39,004     -     66,093     -
Net income (loss) attributable to MEMSIC, Inc. $ (1,931,273 ) $ 52,066   $ (6,225,326 ) $ 800,430
 
Net income (loss) per common share:
Basic $ (0.08 ) $ 0.00   $ (0.26 ) $ 0.03
Diluted $ (0.08 ) $ 0.00   $

(0.26

) $ 0.03
 
Weighted average shares outstanding used in calculating
net income (loss) per common share:
Basic   23,805,072     23,764,284     23,802,357     23,724,587
Diluted   23,805,072     24,102,339     23,802,357     23,981,367
 
 
MEMSIC, Inc.

Reconciliation of Net Income (Loss) to Earnings Before Interest, Taxes and Depreciation and Amortization (EBITDA (Unaudited)

         
 
Three months ended September 30, Nine months ended September 30,
2010 2009 2010 2009
 
Net income (loss) $ (1,931,273 ) $ 52,066 $ (6,225,326 ) $ 800,430
Interest (income) expense, net (99,026 ) (205,322 ) (319,802 ) (665,171 )
Income tax expense (benefit) 36,392 48,927 (79,102 ) 289,021
Depreciation and amortization   1,002,616     493,769     2,822,667     1,518,353  
EBITDA $ (991,291 ) $ 389,440   $ (3,801,563 ) $ 1,942,633  




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