Actions Semiconductor's CEO Discusses Q42011 Results - Earnings Call Transcript

Actions Semiconductor Co., Ltd. (ACTS)

Q42011 Earnings Call

January 19, 2012 - 5:30 p.m. ET


Zhenyu Zhou - Chief Executive Officer

Nigel Liu - Chief Financial Officer

Ellen Davis - The Blueshirt Group, Investor Relations


Richard E. Fearon, Jr. - Accretive Capital Partners



Good day, ladies and gentlemen and thank you for standing by. Welcome to the Actions Semiconductor Fourth Quarter 2011 earnings conference call. (Operator Instructions)

I would now like to turn the conference over to Ellen Davis of The Blueshirt Group. Please go ahead.

Ellen Davis

Good afternoon and thank you for joining us on today's conference call to discuss Actions Semiconductor's fourth quarter and fiscal year 2011 financial results. This call is being broadcast live over the web, and can be accessed on the Investor Relations section of Actions website at for 90 days. On today's call are Dr. Zhenyu Zhou, Chief Executive Officer; Nigel Liu, Chief Financial Officer; and Chung Hsu, Director of Investor Relations.

After the market closed in the U.S. today, Actions issued a press release discussing the results of its fourth quarter and fiscal year-end December 31st, 2011. The press release was also filed on Form 6-K with the U.S. Securities and Exchange Commission. The press release is accessible online at the company's website, as well as the SEC's website or you can call The Blueshirt Group at area code 415-217-7722 and we will e-mail you a copy.

We would like to remind you that during the course of this conference call, Actions management team may make projections or other forward-looking statements regarding future events or the future financial performance of the company. We wish to caution you that such statements are simply estimates and actual events or results may differ materially.

We refer you to the documents that Actions files from time to time with the SEC, specifically the company's most recently filed Forms F-1, 20-F and 6-Ks. These documents identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.

And now, I'd like to turn the call over to Dr. Zhenyu Zhou. Dr. Zhou?

Zhenyu Zhou

Thank you for participating in Actions' earnings conference call. We appreciate your continued interest in the company. This marks my first earning conference call as CEO of Semiconductor -- Actions Semiconductor, and I am pleased to be able to share with you an update on the business, as well as discuss our strategy for 2012.

Later on the call, Nigel Liu, CFO will discuss financial results for the fourth quarter and the fiscal year of 2011, as well as provide guidance for the first quarter. I will be available for the Q&A portion of the call along with Nigel and Chung Hsu, Actions' Director of Investor Relations.

And now, I want to update on our business. For the full year 2011, we were pleased to achieve 26% revenue growth, significantly improve our profitability and an increase in shipment by 23%. Our fourth quarter operating results were in line with the expectations and reflect the current demand environment in our end market.

In the fourth quarter of 2011, Actions revenue was $12.3 million and net loss was $0.1 million, or $0.00 per ADS. Gross margin for the fourth quarter of 2011 was 37.6%. For the fiscal year ended December 31st, 2011, revenue was $47.5 million and net income was $3.1 million or $0.04 per ADS.

I was excited to transition into the role of CEO of Actions Semiconductor. I believe Actions has a great platform from which to build. We are the market leader in portable multimedia SoCs and have a solid track record of product migration, successfully transitioning from the portable audio market into the portable video market.

Actions hold the dominant market share in non-Apple audio products and in video players with gaming and video capture functionality. In 2011, our demand for high definition portable video products gained significant traction, giving us the leading position in the overall portable video market category.

We continue rapidly getting market share in the advanced high definition portable video markets, as well as the automotive audio and boom box market. Our portable audio products have had successfully adopted by large OEMs worldwide.

Over the next year, we plan to leverage the strong product portfolio we have to maintain our market share and further extend our leadership in these established markets. Our growth initiative will be largely focused on penetrating the mobile internet enabled multimedia market.

Connectivity is bringing new life to audio and video players, such as Bluetooth-enabled MP3, boom box and WiFi-based streaming video players. The most important growth element we have identified is the entry-level mobile internet devices, MIDs or media tablets.

We believe this product category represents the strongest growth potential and [views] [ph] on the development work we have done leveraging the Android platform. In these product segments, we can leverage our core technology strengths in multimedia and gaming.

As we move forward and pursue these products as a strategy, we remain focused on driving strength and financial discipline. We will continue to invest in R&D for advanced products, and we will look to lower operational expenses.

Creating long-term shareholder value will continue to be the top priority for the company. In the fourth quarter, we spent approximately $1.2 million on the share repurchase program, compared with $0.4 million in the third quarter.

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