RDA Microelectronics Announces First Quarter 2011 Financial Results

 Posted on July 6, 2024  |  9 minutes  |  1862 words  |  Tobi Tarwater

SHANGHAI, May 9, 2011 (GLOBE NEWSWIRE) -- RDA Microelectronics (Nasdaq:RDA), a fabless semiconductor company that designs, develops and markets Radio Frequency (RF) and mixed-signal chips for cellular, broadcast and connectivity applications, today announced its financial results for the first quarter ended March 31, 2011.

  • Revenue for the first quarter of 2011 was US$55.2 million, exceeding the Company's guidance of US$52-$54 million, compared to US$57.5 million in the immediately preceding quarter and US$35.8 million in the first quarter of 2010, representing a 54.1% year-over-year increase.
  • Gross margin for the first quarter of 2011 was 33.3%, exceeding the Company's guidance range of 32%-33%, compared to 32.4% in the immediately preceding quarter and 24.9% in the first quarter of 2010.
  • Net income for the first quarter of 2011 was US$7.6 million, compared to US$2.5 million in the immediately preceding quarter and US$2.7 million in the first quarter of 2010.
  • Net income per diluted American Depository Share (ADS) for the first quarter of 2011 was US$0.16, compared to US$0.05 in the immediately preceding quarter and US$0.05 in the first quarter of 2010.

"We are pleased with our first quarter financial results, having achieved 54.1% revenue growth year-over-year and continued gross margin improvement," said Vincent Tai, chairman and CEO. "We exceeded our guidance for both revenue and gross margin with strong shipments of our Bluetooth and IPD Front End Module products. We believe that we are continuing to gain market share with our innovative IPD Front End Modules, Bluetooth, FM and Low Noise Block products. Looking ahead, we see two main drivers of near-term revenue growth and margin expansion. First, we expect the IPD Front End Module to continue to gain share; and secondly, we expect to significantly ramp production of our 55-nanometer Bluetooth system-on-chip products during the second quarter of 2011. Both of these factors give us confidence that RDA is in an excellent competitive position."

First Quarter 2011 Business Highlights

  • Shipped over one million units of RDA's new 55-nanometer Bluetooth system-on-chip products
  • Continued strong growth of the IPD Front End Module, Low Noise Block (LNB) satellite down converters and TD-SCDMA transceiver products.
  • Shipped DVB-S tuner products to tier-one customer in Korea
  • Shipped TD-SCDMA transceiver products to North America handset vendor

First Quarter 2011 Operating Summary:

  • Revenue in the first quarter of 2011 was US$55.2 million, compared with US$57.5 million in the immediately preceding quarter and US$35.8 million in the first quarter of 2010. The sequential revenue decrease was primarily due to the shortened sales period resulting from the Chinese New Year holiday and temporary supply constraints on IPD Front End Module. The year-over-year revenue growth was primarily driven by share gains of Bluetooth system-on-chip and IPD Front End Module products; ramping production of LNB satellite down converters and TD-SCDMA products; and the overall growth of the export market addressed by our customers.
  • Gross margin in the first quarter of 2011 was 33.3%, compared with 32.4% in the immediately preceding quarter and 24.9% in the first quarter of 2010. Gross margin expansion was primarily driven by cost reductions from process technology migration and the increased shipment of products that carry higher gross margins.
  • R&D expenses in the first quarter of 2011 were US$7.3 million, compared to US$11.2 million in the immediately preceding quarter and US$4.3 million in the first quarter of 2010. The quarter-over-quarter decrease was primarily due to US$4.1 million in share-based compensation recognized immediately upon the completion of RDA's IPO in November 2010. Adjusted (non-GAAP) R&D expenses, which exclude share-based compensation in the first quarter of 2011 was flat compared to the immediately preceding quarter. The year-over-year increase in R&D expenses was primarily due to the hiring of additional research and development engineers and the acquisition of intellectual property.
  • SG&A expenses in the first quarter of 2011 were US$2.8 million, compared to US$5.0 million in the immediately preceding quarter and US$1.5 million in the first quarter of 2010. The quarter-over-quarter decrease was attributable to US$2.8 million in share-based compensation recognized immediately upon the completion of RDA's IPO in November 2010. The increase in adjusted (non-GAAP) SG&A expenses, which exclude share-based compensation in the first quarter of 2011 compared to immediately preceding quarter and first quarter 2010 was primarily due to the expansion of the Company's sales network and field engineering support team, as well as public company expenses.

Please refer to the tables captioned "Reconciliation of GAAP and Non-GAAP Results" at the end of this press release.

Selected Balance Sheet and Cash Flow Items:

  • As of March 31, 2011, cash, cash equivalents, short-term investments and investments in fixed income mutual funds were US$109.8 million, compared to US$106.1 million as of December 31, 2010. In the first quarter of 2011, the Company generated US$4.1 million cash from operations, compared to US$3.4 million in the immediately preceding quarter.
  • As of March 31, 2011, accounts receivable was US$20.5 million, compared to US$22.7 million as of December 31, 2010. The decrease from December 31, 2010 was primarily related to lower revenue resulting from the shortened sales period due to the Chinese New Year holiday.
  • As of March 31, 2011, inventory was US$45.3 million, compared to US$35.5 million as of December 31, 2010. The increase from December 31, 2010 was primarily due to pre-built inventory in anticipation of higher product demand in the second quarter of 2011. Of the US$9.8 million increase in inventory, US$7.8 million was related to inventory on hand and the remaining US$2.0 million was related to inventory at distributors.
  • As of March 31, 2011, accounts payable was US$21.1 million, compared to US$20.5 million as of December 31, 2010.

Second Quarter 2011 Business Outlook:

For the second quarter of 2011, the Company expects revenues to be in the range of US$65 - $67 million, reflecting historical seasonal growth patterns during the second quarter of each year and the strong momentum of the Company's IPD Front End Module, Bluetooth system-on-chip, Low Noise Block, and DVB-S tuner products. The Company expects gross margins to be in the range of 33.4 % - 34.0%, as it benefits from the migration to 55-nanometer for its Bluetooth system-on-chip products and the further growth of higher gross margin products. This outlook reflects the Company's current and preliminary view and may be subject to change. Please see "Forward-Looking Statements" at the end of this press release.

Conference Call:

RDA Microelectronics will host a conference call and live webcast for analysts and investors at 8:00 p.m. EDT on May 9, 2011 which is at 8 a.m on May 10, 2011 in China.

  • For parties in the United States and Canada, please call 1-877-941-4775 to access the conference call, conference code 4436500.
  • For parties in Hong Kong, please call 852-3009-5027 to access the conference call, conference code 4436500.
  • Other International parties can access the call at 1-480-629-9761, conference code 4436500.

RDA Microelectronics will offer a live webcast of the conference call, which will also include forward-looking information. The webcast will be accessible from the "Investors" section of the Company's website at . The webcast will be archived there for a period of 30 days. An audio replay of the conference call will also be available two hours after the call and will be available for ten days. To hear the replay, parties in the United States and Canada should call 1-800-406-7325 and enter pass code 4436500. International parties should call 1-303-590-3030 and enter pass code 4436500. The press release with the financial results will be accessible from the Company's website before the conference call begins.

Pursuant to the terms of the lockup agreements signed by each of the Company's directors, executive officers, and pre-IPO shareholders in connection with the Company's IPO in November 2010, the lockup period will be extended through May 27, 2011 due to the timing of the release of the Company's financial results.

About RDA Microelectronics

RDA Microelectronics is a fabless semiconductor company that designs, develops and markets radio-frequency and mixed-signal semiconductors. Our product portfolio currently includes power amplifiers, transceivers and front-end modules, FM radio receivers, set-top box tuners, analog mobile television receivers, walkie-talkie transceivers, LNB satellite down converters, and Bluetooth system-on-chips. For additional information, please see our website at .

Forward-Looking Statements

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Any statements in this press release that are not historical facts are forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include our anticipated growth strategies; our future results of operations and financial condition; economic conditions in China; the regulatory environment in China; our ability to attract customers and leverage our brand; trends and competition in the semiconductor industry; and other factors and risks detailed in our filings with the Securities and Exchange Commission. This press release also contains statements or projections that are based upon information available to the public, as well as other information from sources which we believe to be reliable but whose accuracy or completeness we cannot guarantee.  We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.

Non-GAAP Financial Measures

To supplement our unaudited consolidated financial results presented in accordance with U.S. GAAP, we use 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.

We believe 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 GAAP financial measures, provide meaningful supplemental information regarding our performance and that both management and investors benefit from referring to these non-GAAP financial measures in assessing our historical performance and when planning and forecasting our performance in future periods. We believe that excluding share-based compensation expenses helps both management and investors to get a better understanding of our 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 all items that impact our operating expenses and net income for the period. In addition, our 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 we do.  We compensate 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.

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