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RDA Microelectronics Announces Fourth Quarter And Full Year 2012 Financial Results

Stocks in this article: RDA

Non-GAAP Financial Measures

To supplement the Company's unaudited consolidated financial results presented in accordance with U.S. GAAP, the Company uses adjusted (non-GAAP) net income and net income per diluted ADS, adjusted (non-GAAP) R&D expense and adjusted (non-GAAP) SG&A expense, which are defined as non-GAAP financial measures by the SEC. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see below and the tables captioned "Reconciliation of GAAP and Non-GAAP Results" set forth at the end of this press release.

The Company believes that adjusted (non-GAAP) net income and net income per diluted ADS, adjusted (non-GAAP) R&D expense and adjusted (non-GAAP) SG&A expense, viewed in conjunction with the GAAP financial measures, provide meaningful supplemental information regarding the Company's performance and that both management and investors benefit from referring to these non-GAAP financial measures in assessing the Company's historical performance and when planning and forecasting the Company's performance in future periods. The Company believes that excluding share-based compensation expenses and amortization of acquired and licensed intangibles helps both management and investors to get a better understanding of its ongoing business. Adjusted (non-GAAP) net income and net income per diluted ADS, adjusted (non-GAAP) R&D expense and adjusted (non-GAAP) SG&A expense do not include share-based compensation expenses and amortization of acquired and licensed intangibles that impact the Company's operating expenses and net income for the period. In addition, the Company's adjusted (non-GAAP) net income and net income per diluted ADS, adjusted (non-GAAP) R&D expense and adjusted (non-GAAP) SG&A expense may not be comparable to measures with the same or similar titles utilized by other companies, since other companies may not calculate such measures in the same manner as the Company does. The Company compensates for this and other limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures. Reconciliations of GAAP and non-GAAP results are included at the end of this press release.

RDA MICROELECTRONICS, INC.      
Consolidated Balance Sheet Information      
  December 31, 2011 September 30, 2012 December 31, 2012
  (unaudited) (unaudited) (unaudited)
  (amounts in thousands of USD, except number of shares and per share data)
ASSETS      
Current assets       
Cash and cash equivalents  66,178  58,848  75,091
Short-term investments-time deposit  76,009  108,098  42,377
Accounts receivable  43,415  28,229  31,722
Inventories   36,095  58,486  52,007
Prepaid expenses and other current assets  7,122  10,011  11,302
Deferred tax assets  14  3  --
Total current assets  228,833  263,675  212,499
       
Non-current assets       
Property, plant and equipment, Net  5,451  8,386  10,195
Intangible Assets  --  50,805  54,908
Goodwill  --  8,900  8,900
Other long-term assets  8,050  3,206  3,396
Investment   48  48  --
Total assets  242,382  335,020  289,898
       
LIABILITIES      
Current liabilities       
Accounts payable  32,543  55,808  45,063
Accrued expenses and other current liabilities  28,253  24,739  37,869
Deferred revenue  10,651  16,536  10,641
Dividend payable  --  55,946  --
Total current liabilities  71,447  153,029  93,573
       
Deferred tax Liability  --  89  98
       
Total liabilities  71,447  153,118  93,671
       
Commitments and contingencies      
       
SHAREHOLDERS' EQUITY      
Ordinary shares  2,639  2,885  2,885
Additional paid-in capital  117,478  146,674  146,887
Recourse loans  (509)  (1,567)  (1,544)
Accumulated other comprehensive income  1,136  1,042  1,207
Treasury stock  (12,835)  (14,139)  (13,579)
Retained earnings  63,026  47,007  60,371
Total shareholders' equity  170,935  181,902  196,227
       
Total liabilities and shareholders' equity  242,382  335,020  289,898
       
RDA MICROELECTRONICS, INC.      
Consolidated Statement of Operations Information    
  Quarter Ended
  December 31, 2011 September 30, 2012 December 31, 2012
  (unaudited) (unaudited) (unaudited)
  (amounts in thousands of USD, except number of shares and per share data)
Revenue  82,355  109,308  115,605
Cost of revenue  (53,258)  (75,307)  (78,949)
Gross profit  29,097  34,001  36,656
       
Operating expenses:      
Research and development  (8,713)  (16,029)  (17,840)
Selling, general and administrative  (3,897)  (3,977)  (5,836)
Total operating expenses  (12,610)  (20,006)  (23,676)
Operating income  16,487  13,995  12,980
Other income:      
Interest income  718  1,069  808
Impairment Loss  --  --  (48)
Other income(expense), net  486  (259)  425
Income before income taxes  17,691  14,805  14,165
Income tax expense  (1,129)  (1,328)  (801)
Net income  16,562  13,477  13,364
       
       
Earnings per ADS      
- Basic  0.39  0.30  0.29
- Diluted  0.37  0.28  0.28
       
Weighted average ADS equivalent: [1]      
- Basic  42,781,315  45,590,013  46,327,608
- Diluted  45,332,734  47,904,835  48,010,144
       
Share-based compensation was allocated in operating expenses as follows:      
Research and development  408  446  383
Selling, general and administrative  432  518  431
       
[1] Assumes all outstanding ordinary shares are represented by ADSs.  Each ADS represents six ordinary shares.
       
RDA MICROELECTRONICS, INC.    
Consolidated Statement of Operations Information  
  Year Ended
  December 31, 2011 December 31, 2012
  (unaudited) (unaudited)
  (amounts in thousands of USD, except number of shares and per share data)
Revenue  288,862  391,279
Cost of revenue  (189,116)  (265,474)
Gross profit  99,746  125,805
     
Operating expenses:    
Research and development  (32,756)  (54,598)
Selling, general and administrative  (14,074)  (16,963)
Total operating expenses  (46,830)  (71,561)
Operating income  52,916  54,244
Other income(expense):    
Interest income  1,925  3,573
Impairment Loss  --  (48)
Other income (expense), net  1,460  (203)
Income before income taxes  56,301  57,566
Income tax expense  (4,671)  (4,662)
Net income  51,630  52,904
     
     
Earnings per ADS    
- Basic  43,757,127  45,135,321
- Diluted  46,467,593  47,405,084
     
Weighted average ADS equivalent:    
- Basic  1.18  1.17
- Diluted  1.11  1.12
     
     
Share-based compensation was allocated in operating expenses as follows:    
Research and development  2,053  1,532
Selling, general and administrative  1,828  1,679
     
RDA MICROELECTRONICS, INC.
Reconciliation of GAAP and Non-GAAP Results
(amounts in thousands of USD, except number of shares and per share data)
               
  Quarter Ended December 31, 2012
  (unaudited)    
    % of  Share-based Amortization of Non-GAAP % of  Non-GAAP  % of 
  GAAP Result  Net Revenue Compensation Intangible Assets Net Revenue Results Net Revenue
Research and development  17,840 15%  383  2,265 2%  15,192 13%
Selling, general and administrative  5,836 5%  431  --  1%  5,405 4%
Total operating expenses    23,676 20%  814  2,265 3%  20,597 17%
Operating income  12,980 11%  814  2,265 3%  16,059 14%
Net income   13,364 12%  814  2,265 3%  16,443 15%
               
Diluted earnings per ADS  0.28    0.02  0.05    0.34  
               
Weighted average ADS-Diluted  48,010,144    48,010,144  48,010,144    48,010,144  
               
  Quarter Ended September 30, 2012
  (unaudited)    
    % of  Share-based Amortization of Non-GAAP % of  Non-GAAP  % of 
  GAAP Result  Net Revenue Compensation Intangible Assets Net Revenue Results Net Revenue
Research and development  16,029 15%  446  2,265 2%  13,318 13%
Selling, general and administrative  3,977 3%  518  --  1%  3,459 2%
Total operating expenses    20,006 18%  964  2,265 3%  16,777 15%
Operating income  13,995 13%  964  2,265 3%  17,223 16%
Net income   13,477 12%  964  2,265 3%  16,705 15%
               
Diluted earnings per ADS  0.28    0.02  0.05    0.35  
               
Weighted average ADS-Diluted  47,904,835    47,904,835  47,904,835    47,904,835  
               
  Quarter Ended December 31, 2011
  (unaudited)    
    % of  Share-based Amortization of Non-GAAP % of  Non-GAAP  % of 
  GAAP Result  Net Revenue Compensation Intangible Assets Net Revenue Results Net Revenue
Research and development  8,713 10%  408  --  0%  8,305 10%
Selling, general and administrative  3,897 5%  432  --  1%  3,465 4%
Total operating expenses    12,610 15%  840  --  1%  11,770 14%
Operating income  16,487 20%  840  --  1%  17,327 21%
Net income   16,562 20%  840  --  1%  17,402 21%
               
Diluted earnings per ADS  0.37    0.02  --     0.39  
               
Weighted average ADS outstanding-Diluted  45,332,734    45,332,734  45,332,734    45,332,734  
               
               
  Year Ended December 31, 2012
  (unaudited)
    % of  Share-based Amortization of Non-GAAP % of  Non-GAAP  % of 
  GAAP Result  Net Revenue Compensation Intangible Assets Net Revenue Results Net Revenue
Research and development  54,598 14%  1,532  7,275 2%  45,791 12%
Selling, general and administrative  16,963 4%  1,679  --  1%  15,284 3%
Total operating expenses    71,561 18%  3,211  7,275 3%  61,075 15%
Operating income  54,244 14%  3,211  7,275 3%  64,730 17%
Net income   52,904 14%  3,211  7,275 3%  63,390 17%
               
Diluted earnings per ADS  47,405,084    47,405,084  47,405,084    47,405,084  
               
Weighted average ADS outstanding-Diluted  1.12    0.07  0.15    1.34  
               
               
  Year Ended December 31, 2011
  (unaudited)    
    % of  Share-based Amortization of Non-GAAP % of  Non-GAAP  % of 
  GAAP Result  Net Revenue Compensation Intangible Assets Net Revenue Results Net Revenue
Research and development  32,756 11%  2,053  --  1%  30,703 10%
Selling, general and administrative  14,074 5%  1,828  --  0%  12,246 5%
Total operating expenses    46,830 16%  3,881  --  1%  42,949 15%
Operating income  52,916 18%  3,881  --  1%  56,797 19%
Net income   51,630 18%  3,881  --  1%  55,511 19%
               
Diluted earnings per ADS  46,467,593    46,467,593  46,467,593    46,467,593  
               
Weighted average ADS outstanding-Diluted  1.11    0.08  --     1.19  
CONTACT: Lily Dong, Chief Financial Officer
         RDA Microelectronics, Inc.
         +86-21-5027-1108
         ir@rdamicro.com
         
         Or
         
         Leanne Sievers, EVP
         Shelton Group Investor Relations
         949-224-3874
         lsievers@sheltongroup.com

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