LONDON — (BUSINESS WIRE) — May 3, 2016 — Dialog Semiconductor plc (FWB: DLG), a provider of highly integrated power management, AC/DC power conversion, solid state lighting and Bluetooth(R) Smart wireless technology, today reports results for the quarter ended 1 April 2016.
Q1 2016 financial highlights
- Revenue of $241.4 million, at the high-end of guidance
- Power Conversion revenue up 28% over Q1 2015 to $24.0 million
- Gross margin at 44.6%. Underlying gross margin at 45.5%, in line with guidance
- $137.3 million Atmel termination fee in other operating income
- Adjusted EBITDA (**) up 142% over Q1 2015 to $165.9 million or 69% of revenue. Underlying (*) adjusted EBITDA (**) down 49% over Q1 2015 to $41.0 million or 17% of revenue
- Operating profit up 172% over Q1 2015 to $151.2 million or 63% of revenue
- Basic and diluted EPS up 232% and 240% respectively over Q1 2015. Underlying (*) basic and diluted EPS down 64% and 61% respectively over Q1 2015
- $662 million of cash and cash equivalents
Q1 2016 operational highlights
- Continued design win momentum for Power Management with custom and standard products at leading smartphone and tablet OEMs
- Strengthened our leadership position in the mobile adapter rapid charge market
- LED Solid State Lighting portfolio expansion with new products launched
- New design wins for our Bluetooth(R) Smart SoC for watches, fitness bands and gaming
- Good momentum in China smartphone market with sub-PMIC ASSP through platform integration with MediaTek
Commenting on the results Dialog Chief Executive, Dr Jalal Bagherli, said:
"We have made encouraging progress at the start of 2016 in the context of the expected softening of the smartphone market, achieving revenue performance at the top end of our guidance range. I am particularly pleased with Power Conversion's strong progress, where we continue to build on our leadership position in the smartphone fast charging market.
Underpinning our mid-term organic growth opportunity, we have an increasing number of custom-designed (ASIC) opportunities for our core technologies with a variety of Tier 1 customers. In support of these opportunities, we are making focused investments in research and development and are expanding our technology portfolio for emerging high volume product areas. These investments will strengthen our competitive position, broaden our customer base and underpin our expectation of return to revenue growth in 2017 and beyond."
Outlook
Based on our current visibility, we anticipate revenue for Q2 2016 to improve sequentially from Q1 2016 and to be in the range of $240 to $260 million. On the basis of this revenue guidance, gross margin in Q2 2016 will be flat to marginally above Q1 2016.
In line with historic seasonality, we expect revenue performance for the full year to be strongly weighted towards the second half of the year. However, as a result of the continuing softness in smartphone market demand, we now anticipate revenue for the full year 2016 to decline high single digit percentage year-on-year. We expect growth momentum in our Connectivity and Power Conversion products to remain strong through 2016.
In line with the revenue performance, we expect underlying gross margin percentage for the full year to be slightly below the level achieved in 2015. The effect of the lower anticipated revenue in FY 2016 will be partially offset by rigorous control of operating expenses in the period.
Financial overview
|
IFRS |
First Quarter |
||||||||||||||
|
US$ million |
2016 |
2015 |
Var. |
||||||||||||
|
Revenue |
241.4 | 311.2 | -22% | ||||||||||||
|
Gross margin |
44.6% | 46.0% | -140bps | ||||||||||||
|
R&D %(1) |
23.8% | 17.3% | +650bps | ||||||||||||
|
SG&A %(1) |
15.1% | 11.0% | +410bps | ||||||||||||
|
Other operating income %(2) |
56.9% | - | nm | ||||||||||||
|
Operating profit |
151.2 | 55.6 | +172% | ||||||||||||
|
Operating margin |
62.6% | 17.9% | nm | ||||||||||||
|
Net income |
142.9 | 38.8 | +268% | ||||||||||||
|
Basic EPS $ |
1.89 | 0.57 | +232% | ||||||||||||
|
Diluted EPS $ |
1.80 | 0.53 | +240% | ||||||||||||
|
Cash flow from operating activities |
107.1 | 119.6 | -10% | ||||||||||||
|
Underlying |
First Quarter |
||||||||||||||
|
US$ million |
2016 |
2015 |
Var. |
||||||||||||
|
Revenue |
241.4 | 311.2 | -22% | ||||||||||||
|
Gross margin |
45.5% | 46.6% | -110bps | ||||||||||||
|
R&D %(1) |
22.3% | 16.0% | +630bps | ||||||||||||
|
SG&A %(1) |
10.9% | 8.0% | +290bps | ||||||||||||
|
Adjusted EBITDA |
41.0 | 80.2 | -49% | ||||||||||||
|
Adjusted EBITDA % |
17.0% | 25.8% | -880bps | ||||||||||||
|
Operating profit |
29.9 | 71.0 | -58% | ||||||||||||
|
Operating margin |
12.4% | 22.8% | nm | ||||||||||||
|
Net income |
21.6 | 55.5 | -61% | ||||||||||||
|
Basic EPS $ |
0.29 | 0.81 | -64% | ||||||||||||
|
Diluted EPS $ |
0.28 | 0.71 | -61% | ||||||||||||
(1) R&D and SG&A as a percentage of revenue.
