This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including our confidence that the underlying strength and design wins of our Smart TV products will drive our revenue growth in fiscal 2017, our confidence that we will see another year of revenue growth and profitability driven by our strong and differentiated products serving both established and new customers and the anticipated benefits and features of our recently announced products. The forward-looking statements contained in this press release involve risks and uncertainties. Actual results may vary materially from expectations discussed in such forward-looking statements due to a number of factors including, but not limited to, the risk that, upon completion of further closing procedures and audit, the financial results for the fourth quarter and fiscal year 2016 are different than the results set forth in this press release, our ability to recognize revenue from design wins, general economic conditions, the ability to recognize the anticipated savings from our restructuring efforts, the rate of growth of Smart TVs, Internet of Things Devices, Set-top-Box and Media Connectivity, the ramp in demand from our Set-Top-Box, television and telecommunication customers, our ability to deploy and achieve market acceptance for our products, unanticipated costs and risks related to the integration of Bretelon and further development of Bretelon technology and the risk that such products will not gain widespread acceptance, or will be rendered obsolete, by product offerings of competitors or by alternative technologies, and other risks detailed from time to time in our filings with the Securities and Exchange Commission. In particular, see Sigma's recent quarterly and annual reports filed with the Securities and Exchange Commission, copies of which are available at www.sec.gov. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly release or otherwise disclose the result of any revision to these forward-looking statements that may be made as a result of events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
About Sigma Designs, Inc.
Sigma Designs, Inc. (
Sigma Designs, Secure Media Processor, and the Sigma Designs logo are either registered trademarks or trademarks of Sigma Designs, Inc. and its subsidiaries in the United States and other countries. All other trademarks mentioned herein are believed to be trademarks of their respective owners.
SIGMA DESIGNS, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(GAAP)
(In thousands)
January 30, January 31,
2016 2015
------------- -------------
Assets
Current Assets:
Cash and cash equivalents $ 63,790 $ 83,502
Short-term marketable securities 4,805 6,347
Restricted cash 900 400
Accounts receivable, net 30,362 26,415
Inventory 26,709 20,445
Deferred tax assets 0 3,319
Prepaid expenses and other current assets 14,085 8,805
------------- -------------
Total current assets 140,651 149,233
Long-term marketable securities 3,527 4,249
Software, equipment and leasehold improvements,
net 14,086 21,594
Goodwill 11,068 -
Intangible assets, net 37,050 24,642
Deferred tax assets, net of current portion 911 687
Long-term investments, net of current portion 2,884 3,267
Other non-current assets 6,492 1,661
------------- -------------
Total assets $ 216,669 $ 205,333
============= =============
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable $ 26,181 $ 21,207
Accrued compensation and related benefits 7,360 6,806
Accrued liabilities 14,632 22,894
------------- -------------
Total current liabilities 48,173 50,907
Other long-term liabilities 15,691 11,136
------------- -------------
Total liabilities 63,864 62,043
Shareholders' equity 152,805 143,290
------------- -------------
Total liabilities and shareholders' equity $ 216,669 $ 205,333
============= =============
SIGMA DESIGNS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(GAAP)
(In thousands, except per share data)
Three months ended Twelve months ended
------------------------------- --------------------
January October January January January
30, 2016 31, 2015 31, 2015 30, 2016 31, 2015
--------- --------- --------- --------- ---------
Net revenue $ 51,450 $ 61,581 $ 54,846 $ 227,250 $ 188,313
Cost of revenue 26,949 30,794 28,126 114,090 92,967
--------- --------- --------- --------- ---------
Gross profit 24,501 30,787 26,720 113,160 95,346
Gross margin percent 47.6% 50.0% 48.7% 49.8% 50.6%
Operating expenses:
Research and
development 19,030 17,339 17,324 68,784 67,482
Sales and marketing 5,937 5,875 5,806 22,877 22,290
General and
administrative 4,771 5,314 5,247 20,862 19,641
Restructuring costs - - (3) 9 999
Impairment of IP,
mask sets and
design tools - 795 689 1,783 2,811
--------- --------- --------- --------- ---------
Total operating
expenses 29,738 29,323 29,063 114,315 113,223
Income (loss) from
operations (5,237) 1,464 (2,343) (1,155) (17,877)
Gain on sale of
development project - 7,551 - 7,551 -
Interest and other
income, net 132 37 661 953 1,169
--------- --------- --------- --------- ---------
Income (loss) before
income taxes (5,105) 9,052 (1,682) 7,349 (16,708)
Provision for income
taxes 1,086 2,617 1,928 7,191 4,993
--------- --------- --------- --------- ---------
Net income (loss) $ (6,191) $ 6,435 $ (3,610) $ 158 $ (21,701)
========= ========= ========= ========= =========
Net income (loss) per
share:
Basic $ (0.17) $ 0.18 $ (0.10) $ 0.00 $ (0.63)
Diluted $ (0.17) $ 0.17 $ (0.10) $ 0.00 $ (0.63)
Shares used in
computing net income
(loss) per share:
Basic 36,568 36,046 35,036 35,890 34,693
Diluted 36,568 36,785 35,036 36,669 34,693
SIGMA DESIGNS, INC.
RECONCILIATION OF GAAP NET INCOME (LOSS) TO NON-GAAP NET INCOME (LOSS)
(Unaudited)
(In thousands, except per share data)
Three months ended Twelve months ended
------------------------------- --------------------
January October January January January
30, 2016 31, 2015 31, 2015 30, 2016 31, 2015
--------- --------- --------- --------- ---------
GAAP Net Revenue $ 51,450 $ 61,581 $ 54,846 $ 227,250 $ 188,313
Items reconciling
GAAP Revenue to Non-
GAAP:
Reversal of rebate - - - (1,027) -
--------- --------- --------- --------- ---------
GAAP to Non-GAAP
adjustments - - - (1,027) -
Non-GAAP Net
Revenue $ 51,450 $ 61,581 $ 54,846 $ 226,223 $ 188,313
GAAP Cost of Revenue $ 26,949 $ 30,794 $ 28,126 $ 114,090 $ 92,967
Items reconciling
GAAP Cost of Revenue
to Non-GAAP:
Stock based
compensation
expense (69) (78) (39) (227) (189)
Amortization of
acquired
intangibles (965) (965) (1,062) (3,960) (4,281)
Restructuring costs - - (15) - (66)
--------- --------- --------- --------- ---------
GAAP to Non-GAAP
adjustments (1,034) (1,043) (1,116) (4,187) (4,536)
Non-GAAP Cost of
Revenue $ 25,915 $ 29,751 $ 27,010 $ 109,903 $ 88,431
GAAP Gross Profit $ 24,501 $ 30,787 $ 26,720 $ 113,160 $ 95,346
GAAP Gross Margin % 47.6% 50.0% 48.7% 49.8% 50.6%
Non-GAAP Gross
Profit $ 25,535 $ 31,830 $ 27,836 $ 116,320 $ 99,882
Non-GAAP Gross
Margin % 49.6% 51.7% 50.8% 51.4% 53.0%
GAAP Operating
Expenses $ 29,738 $ 29,323 $ 29,063 $ 114,315 $ 113,223
Items reconciling
GAAP Operating
Expense to Non-GAAP:
Stock based
compensation
expense (1,610) (1,814) (1,662) (6,333) (6,089)
Amortization of
acquired
intangibles (648) (318) (346) (1,627) (1,383)
Impairment of IP,
mask sets and
design tools - (795) (689) (1,783) (2,811)
Settlement expenses - - - - (107)
One time legal fee
expenses (85) (357) (258) (1,687) (614)
Restructuring costs - - 3 (9) (999)
--------- --------- --------- --------- ---------
GAAP to Non-GAAP
adjustments (2,343) (3,284) (2,952) (11,439) (12,003)
Non-GAAP Operating
Expenses $ 27,395 $ 26,039 $ 26,111 $ 102,876 $ 101,220
GAAP Other Income
(Expense) and Tax $ (954) $ 4,971 $ (1,267) $ 1,313 $ (3,824)
Items reconciling
GAAP Other Income
(Expense) and Tax to
Non-GAAP:
Impairment (gain on
sale) of privately
held instruments,
net 251 - 4 (141) 602
Gain on sale of
development
project - (7,551) - (7,551) -
Income tax
adjustments 3,463 1,494 1,016 6,159 495
--------- --------- --------- --------- ---------
GAAP to Non-GAAP
adjustments 3,714 (6,057) 1,020 (1,533) 1,097
Non-GAAP Other
Income (Expense)
and Tax $ 2,760 $ (1,086) $ (247) $ (220) $ (2,727)
Non-GAAP Net Income
(Loss) $ 900 $ 4,705 $ 1,478 $ 13,224 $ (4,065)
========= ========= ========= ========= =========
Non-GAAP Net Income
(Loss) per share:
Basic $ 0.02 $ 0.13 $ 0.04 $ 0.37 $ (0.12)
Diluted $ 0.02 $ 0.13 $ 0.04 $ 0.36 $ (0.12)
Shares used in
computing Non-GAAP
net income (loss)
per share:
Basic 36,568 36,046 35,036 35,890 34,693
Diluted 36,995 36,785 35,036 36,669 34,693
