Himax Technologies, Inc. (Nasdaq: HIMX) (“Himax” or “Company”), a
leading supplier and fabless manufacturer of display drivers and
other semiconductor products, announced its financial results for
the fourth quarter ended December 31, 2019.
“We pre-announced preliminary key financial
results for the fourth quarter on January 7, 2020 as the revenues,
gross margin and EPS of the quarter all exceeded our guidance
issued on November 7, 2019. Revenues and gross margin were in line
with the pre-announced results while EPS were at the high end of
the range. When we hosted our third quarter earnings call this past
November, we were facing trends in the marketplace that created
headwinds for us. Specifically, at that time our performance and
forecast reflected challenges we faced in our smartphone TDDI
business. This was exacerbated by an oversupply of panel capacity
in the LCD industry that negatively impacted our display driver IC
sales and margin. As a result, our overall sales and outlook
were weak. Since that time, we have started to see major turnaround
in literally all aspects of our businesses,” said Mr. Jordan Wu,
President and Chief Executive Officer of Himax.
“Looking at the overall company, historically,
the first quarter has seasonally been the lowest quarter of the
fiscal year, often down by over 10% on a sequential basis. At
this time, we expect to deliver a sequential sales increase in the
first quarter. The strength we are seeing in Q1 is expected to
extend into Q2 and throughout 2020, despite the coronavirus impact.
Notwithstanding the uncertainty arisen from the coronavirus, we are
confident that we will see decent growth across the board for all
our major product categories in 2020. Our large display driver IC
business is benefiting from numerous factors - customers revamping
inventory levels, the fulfillment of rush orders, recovery of large
panel prices, a tightening of foundry capacity and the market share
gains of China, our key customer base, who are gaining as a result
of fab restructuring that is occurring in Korea.”
“Our smartphone TDDI business is also expected
to deliver strong growth in 2020 despite the impact of the
coronavirus. Our smartphone TDDI product roadmap, new end customer
design-wins and a foundry capacity advantage all position us well
to gain significant market share as we move through 2020. In
addition, we expect our other TDDI applications to deliver strong
growth in 2020 as well. Specifically, the tablet business is
expected to be a major growth area for Himax starting Q1,
throughout 2020 and beyond. This is being driven by in-cell TDDI
for tablets that is becoming the mainstream technology being
rapidly adopted by all major end customers. Given the fact that
Himax is the primary partner for non-iOS tablet TDDI
solutions, we are well positioned to benefit from this trend.”
“On the non-driver side, starting from WLO,
based on our anchor customer’s shipment forecast, we expect very
strong Q1 with shipment volume to double from the same period last
year, although the volume is expected to decrease slightly on a
sequential basis to reflect seasonality. Additionally, we continue
to make great progress across our broader non-driver portfolio
including 3D sensing, the ultra-low power smart sensing solutions,
the CMOS image sensor and our LCOS technology. The adoption of new
technologies is expected to drive growth in the second half of 2020
and become significant source of long-term growth opportunities for
Himax,” added Mr. Jordan Wu.
“We continue to execute on our strategic plans
that have positioned Himax to be uniquely able to take advantage of
many opportunities that we see are arising in the marketplace,”
concluded Mr. Jordan Wu.
Fourth Quarter 2019 Financial
Results
The Company recorded net revenues of $174.9
million, an increase of 6.5% sequentially and a decrease of 8.4%
compared to the same period last year. Revenues were better than
its guidance of flat quarter-over-quarter. Both display driver and
non-driver businesses contributed to
the better-than-guided sales. Gross margin was 20.6%,
exceeding the prior guidance of a slight increase compared to third
quarter’s 19.5%. A more favorable product mix among small display
products, improved WLO factory utilization and higher-than-expected
engineering fees from new project engagements enhanced the gross
margin for the fourth quarter. IFRS profit per diluted ADS was 0.6
cents, exceeding its guidance of a loss per diluted ADS of around
3.0 to 4.5 cents. Stronger sales and improved gross margin both
contributed to the better-than-expected earnings. In addition, the
Company booked a revaluation gain of $3.8 million from an
investment it made in an AI startup during November 2017. The
revaluation gain was not included in the November guidance.
Non-IFRS profit per diluted ADS was 0.9 cents, exceeding its
guidance of a loss per diluted ADS of around 2.7 to 4.2 cents.
Revenue from large display drivers was $57.9
million, up 15.6% sequentially, and down 22.0% year-over-year. The
sequential growth was driven by Chinese panel customers’ ramping of
new LCD fabs and their building of inventories in anticipation of
growing demand and price hike in 2020. The revenue was, however,
lower than the level of the last quarter of 2018 when the
production outputs of panel makers reached the peak. Since then,
they have cut back their production every quarter to address the
overall weak TV demand and industry-wide oversupply. Large panel
driver ICs accounted for 33.1% of its total revenues for the
quarter, compared to 30.5% in the third quarter and 38.9% a year
ago.
Revenue for small and medium-sized display
drivers was $81.1 million, up 5.1% sequentially and up 1.6%
year-over-year. The segment accounted for 46.4% of total sales for
the quarter, compared to 46.9% in the third quarter and 41.8% a
year ago. The sales growth, both sequentially and year-over-year,
was primarily driven by higher automotive and tablet sales, offset
by a decrease in TDDI sales for smartphone, although the decrease
was less than the Company previously expected.
Sales into smartphones were down 22.5%
sequentially and down 14.3% year-over-year. Both the sequential and
year-over-year declines were caused mainly by lower TDDI shipments.
However, on a full-year basis, Himax’s 2019 TDDI shipments
were close to double compared to the prior year as the Company’s
fulfillment was capped during 2018 due to capacity constraint.
Starting Q419, Himax’s business started to see a major
turnaround thanks to the Company’s penetration into more tier-1
smartphone OEMs, the industry’s rapid roll-out of TDDI in mid to
low-end smartphones and the Company’s aggressive move to develop
new foundry for TDDI. The fourth quarter sales of traditional DDICs
declined by 20.2% sequentially but increased 14.3% from last year.
Display drivers for tablet and other consumer products were up
26.5% sequentially, better than the Company’s prior guidance of a
20% increase. This was due to customers’ inventory replenishment
and strong demands from certain brand customers. The fourth quarter
sales of tablet and consumer products were also up by 25.8%
year-over-year.
Driver IC revenue for the automotive application
was up 23.2% sequentially, better than the Company’s guidance of
more than 15% increase. It was up 1.9% from the same period last
year.
Revenues from non-driver businesses were $35.9
million, down 3.0% sequentially and 2.6% year-over-year. Non-driver
products accounted for 20.5% of total revenues, as compared to
22.6% in the third quarter of 2019 and 19.3% a year ago.
Gross margin for the fourth quarter was 20.6%,
up 110 basis points sequentially but down 370 basis points from the
same period last year. Gross margin outperformed the Company’s
prior expectation of a slight increase compared to the 19.5% of the
third quarter. A more favorable product mix among small and
medium-sized display driver products, improved WLO factory
utilization and higher engineering fees from project engagements
were the factors behind the sequential increase. Increased
shipments of the WLO product to an anchor customer led to higher
capacity utilization of its WLO fabs and therefore better gross
margin compared to the same period last year. The year-over-year
decline was largely due to smartphone TDDI ASP erosion arisen from
increased competition as well as more TDDI shipments for lower-end
market. Moreover, its large panel driver IC businesses faced
headwinds during 2019 when the cost of its COF packaging
material went up for capacity shortage and the display industry
suffered from a severe capacity oversupply.
IFRS operating expenses were $37.4 million in
the fourth quarter, down 5.6% from the preceding quarter and down
8.8% from a year ago. The sequential decrease was caused by
decreased salary and R&D expenses. The year-over-year decrease
was also a result of decreased salary and R&D expenses, offset
by the increase of depreciation expense. Non-IFRS operating
expenses for the fourth quarter were $36.8 million, down 6.2% from
the previous quarter and down 9.5% from the same quarter in
2018.
IFRS operating margin for the fourth quarter was
-0.8%, up from -4.7% in the prior quarter and down from 2.8% in the
same period last year. The sequential improvement was primarily a
result of higher sales, better gross margin and lower operating
expenses. The year-over-year decline was a result of lower sales
and gross margin, offset by lower operating expenses.
Fourth quarter non-IFRS operating loss was $0.7
million, or -0.4% of sales, versus non-IFRS operating loss of $7.3
million, or -4.4% of sales last quarter, and down from 3.0% for the
same period last year. The sequential improvement and
year-over-year declines were for the same reasons stated above.
IFRS profit for the fourth quarter was $1.0
million, or 0.6 cents per diluted ADS, compared to loss of $7.2
million, or 4.2 cents per diluted ADS, in the previous quarter and
IFRS profit of $8.5 million, or 4.9 cents per diluted ADS, a year
ago. IFRS earnings per diluted ADS exceeded prior guidance of a per
diluted ADS loss of around 3.0 to 4.5 cents. The
better-than-expected earnings were due to stronger sales, improved
gross margin, lower operating expenses and a revaluation gain of
$3.8 million, or 2.2 cents per diluted ADS, from a previous
investment in an AI startup made during November of 2017. This was
the second revaluation gain the Company booked for the same
investment with the first such gain of $2.9 million, or 1.7 cents
per diluted ADS, booked in the same period last year. The
year-over-year decline was a result of lower sales and gross
margin, offset by lower operating expenses. Excluding the
revaluation gain, IFRS loss for the quarter was $2.7 million, or
1.6 cents per diluted ADS, compared to loss of $7.2 million, or 4.2
cents per diluted ADS, in the previous quarter and profit of $5.6
million, or 3.2 cents per diluted ADS from the same period last
year.
Fourth quarter non-IFRS profit was $1.5 million,
or 0.9 cents per diluted ADS, compared to non-IFRS loss of $6.9
million, or 4.0 cents per diluted ADS last quarter and non-IFRS
profit of $8.7 million, or 5.0 cents per diluted ADS for the same
period last year. Non-IFRS earnings per diluted ADS exceeded prior
guidance of a loss per diluted ADS of around 2.7 to 4.2 cents. The
better-than-expected earnings were due to the reasons mentioned
above. Excluding the revaluation gain, non-IFRS loss for the
quarter was $2.2 million, or 1.3 cents per diluted ADS, compared to
non-IFRS loss of $6.9 million, or 4.0 cents per diluted ADS last
quarter and profit of $5.8 million, or 3.3 cents per diluted ADS
for the same period last year.
Full Year 2019 Financial
Results
The 2019 full year revenues totaled $671.8
million in 2019, a 7.2% decline over 2018.
Revenue from large panel display drivers totaled
$237.3 million, a decrease of 8.9% year-over-year, representing
35.3% of its total revenues, as compared to 36.0% in 2018.
Small and medium-sized driver sales totaled
$307.4 million, a decrease of 5.6% year-over-year, representing
45.8% of its total revenues, as compared to 45.0% in 2018.
Non-driver products sales totaled $127.1
million, a decrease of 7.5% year-over-year, representing 18.9% of
its total sales, as compared to 19.0% a year ago.
Gross margin in 2019 was 20.5%, down from 23.3%
in 2018. The year-over-year decline can largely be attributed to
smartphone TDDI ASP erosion due to increased competition and
significantly more shipments of TDDI for lower-end market.
Moreover, Himax’s large panel driver IC business was impacted by
industry-wide TV panel oversupply and high material cost. On the
positive side, more WLO shipments in 2019 led to improved capacity
utilization of its WLO fabs and therefore better gross margin.
IFRS operating expenses were $156.2 million,
down $9.3 million, or 5.6%, compared to last year. The decrease was
primarily the result of lower salary, R&D expenses and
share-based compensation, despite higher depreciation expenses out
of the Company’s new building. Himax did not issue RSUs in 2019
like it did in previous years but granted stock options to
employees instead. The fourth quarter stock option related
compensation expense was $0.33 million.
IFRS operating loss was $18.3 million, a decline
of $21.7 million from 2018, due to lower sales and lower gross
margin, offset by lower operating expenses. For the same reason
non-IFRS operating loss was $16.4 million, a decrease of $25.4
million from 2018.
IFRS loss for the year was $13.6 million, or 7.9
cents per diluted ADS, versus a profit of $8.6 million or 5.0 cents
per diluted ADS. Non-IFRS loss for 2019 was $12.1 million, or 7.0
cents per diluted ADS, down $25.0 million year-over-year.
Balance Sheet and Cash Flow
Himax had $112.1 million of cash, cash
equivalents and other financial assets as of the end of December
2019, compared to $117.7 million at the same time last year and
$128.0 million a quarter ago. Himax made an operating cash inflow
of $23.4 million during the fourth quarter. The cash position was
however reduced from the last quarter because it repaid $33.4
million of unsecured borrowings and made a capex of $2.7 million
during the quarter. On top of the cash position, restricted cash
was $164.0 million at the end of the quarter, the same as the
preceding quarter and a year ago. The restricted cash is mainly
used to guarantee the secured short-term borrowing for the same
amount. The Company had $57.3 million of unsecured short-term loan
at the end of Q4, substantially lower than the $90.6 million a
quarter ago.
Himax’s year-end inventories as of December 31,
2019 were $143.8 million, down from $167.6 million last quarter and
$162.6 million a year ago. Account receivables at the end of
December 2019 were $164.9 million, up from $157.3 million last
quarter but down from $189.3 million a year ago. DSO was 90 days at
the year end, as compared to 95 days a year ago and 86 days at the
end of the last quarter. As highlighted in the last earnings calls,
in response to capacity shortage of foundry and certain packaging
material, the Company had to keep the inventory level higher than
usual in 2018. Given the unfavorable market conditions and easing
of foundry capacity in 2019, the Company has started to control its
inventory level since the first quarter of 2019. Himax believes
inventory has reached a healthy level and given the prevailing
uncertain market conditions, the Company will monitor its inventory
situation carefully.
Net cash inflow from operating activities for
the fourth quarter was $23.4 million as compared to an inflow of
$2.3 million for the same period last year and an inflow of $24.0
million last quarter. Cash inflow from operations in 2019 was $7.7
million as compared to $4.0 million in 2018.
Fourth quarter capital expenditures amounted to
$2.7 million, versus $5.2 million a year ago and $31.2 million last
quarter. The vast majority of the third quarter capex was for the
purchase of land, the construction of a new building and WLO
capacity expansion. The investment project has been concluded with
the final payment of $1.5 million made in the fourth quarter. The
investment in design tools and R&D related equipment for the
Company’s traditional IC design business was $1.2 million in Q4
versus $2.0 million in Q3. Total capital expenditure for the year
was $45.9 million, of which $7.3 million was design tools and
R&D related equipment. In comparison, the capex for 2018 was
$49.7 million, of which $7.6 million was for design tools and
R&D related equipment.
Share Buyback Update
As of December 31, 2019, Himax had 172.2 million
ADS outstanding, no change from last quarter. On a fully diluted
basis, the total number of ADS outstanding is 172.6 million.
2020 Investor Outreach and
Conferences
Ms. Jackie Chang, CFO, Mr. Sky Wang, internal
IR, and Ms. Maili Bergman, Himax’s US-based external IR, will
maintain corporate access for shareholders and attend future
investor conferences. If you are interested in speaking with the
management, please contact Himax’s US or Taiwan-based investor
relations contact at the numbers below.
Q1 2020 Outlook
When Himax hosted its third quarter earnings
call this past November, the Company was facing trends in the
marketplace that created headwinds for the Company. Specifically,
at that time the Company’s performance and forecast reflected
challenges Himax faced in its smartphone TDDI business. This was
exacerbated by an oversupply of capacity in the LCD industry that
negatively impacted its display driver IC sales and margin. As a
result, the Company’s overall sales and outlook were weak. Since
that time, the Company has started to see major turnaround in
literally all aspects of its businesses and is seeing strength
across all major product lines for the first quarter. The strength
the Company is seeing in Q1 is expected to accelerate into Q2 and
throughout the rest of 2020.
Display
Driver IC
BusinessLDDICFor the first
quarter, the Company expects the large display driver IC segment
revenue to increase by around 10% sequentially. Sensing strong
signs of panel price recovery, panel makers began to replenish
their inventory and increase production starting the end of Q4
2019. The Company’s leading Chinese panel customers are
particularly active in gaining further market share, taking
advantage of Korean panel makers’ ongoing fab restructuring. As the
leading IC supplier, Himax is well positioned to benefit from
increased demand coming out of the major Chinese large display
players. These market trends, that began to emerge during Q4 2019,
are expected to drive strong results in Q1 that will accelerate
throughout 2020.
On the supply side, the Company reported during
the last quarter’s earnings call that Himax and some of its major
panel customers were already seeing foundry capacity shortage of
8-inch silicon wafers for display driver ICs. In anticipation of
this, the Company has strategically prepared to ready its 12-inch
foundry, as well as associated backend packaging and testing, ahead
of its peers to cover the potential 8-inch capacity shortfall. The
Company’s design project coverage is strong across all leading
Chinese panel makers. Himax is very positive on the business
outlook for its large display driver for 2020.
Looking at technology development, the upcoming
2020 Tokyo Olympics will be broadcast in 8K resolution. All
top-tier TV brands have been trying to boost sales for 8K models
ahead of the event. At CES last month, many of these brands
showcased 8K TV’s that contained Himax’s technology. Although the
penetration of 8K TV’s is still low, the Company expects this to be
a strategic opportunity for Himax as 8K TV sales will boost demand
for not just its driver IC but also timing controller contents.
SMDDICBegin with the Company’s
smartphone business segment. The Company’s TDDI product roadmap as
well as new design-wins with end customers and a foundry capacity
advantage have positioned Himax to gain market share starting
the first quarter and throughout 2020.
The smartphone market continues to embrace new
technologies and are moving toward higher frame rate displays to
enable smoother screen viewing and gaming experience. This will
drive the adoption of next generation high frame rate TDDI
solutions, for which Himax is a leading technology provider. Also,
the demand for 5G in China is expected to drive worldwide
smartphone growth in 2020 which will in turn stimulate the growth
for TDDI. All these trends will benefit Himax. However, as
indicated in the First Quarter 2020 Guidance section, the
small display business, among which smartphone TDDI is the major
item, will be most impacted by the coronavirus outbreak in the
short term. Again, the Company is working with its customers
extremely closely, adjusting its operations to support their short
term needs in combating the coronavirus outbreak. Regardless
of the coronavirus, we are confident that our smartphone TDDI
business will grow strongly from last year.
The price erosion of TDDI the Company has seen
over the past year is expected to abate in 2020. This is not only
because the new high frame rate products enjoy a higher ASP but
also due to the industry-wide tightening of foundry capacity for
TDDI. As a reminder, during 2018 the Himax TDDI business was
negatively impacted by a severe foundry capacity shortage that
resulted in its inability to meet customers’ delivery requirements.
Although the capacity constraint was resolved toward the end of
2018, the delay limited the Company’s ability to participate in
major design-in opportunities that would have driven the business
in 2019. The actions Himax took in 2018-2019 to develop and enable
an additional qualified foundry partner ahead of its peers,
combined with the Company’s superior technology and customer
collaboration, now uniquely position Himax to benefit from a
tightening of overall TDDI foundry capacity in 2020. The Company is
well-prepared to meet TDDI production demands and continue to move
forward with plans to enable additional capacity this year to
capitalize on the strong opportunities for smartphone TDDI, as well
as other TDDI applications such as tablet, in 2020.
As expected, the Company’s traditional discrete
driver IC sales into smartphones posted a sequential decline for
the fourth quarter. This was primarily due to the traditional
discrete driver ICs’ addressable smartphone market is quickly being
replaced by TDDI and AMOLED.
As Himax discussed previously, a major
development the Company is seeing in the marketplace is increased
utilization of the OLED display for smartphone. This is due to
expanded AMOLED capacity as well as increased demand for
under-display fingerprint technology that is only available in the
AMOLED display for the time being. The Company is encouraged by the
progress it has made, collaborating closely with leading panel
makers across China for AMOLED product development. The Company
believes AMOLED driver ICs will soon become one of the major growth
engines for its small panel driver IC business.
In the automotive display segment, the number of
displays per vehicle continues to rise as the overall automobile
display market is set to increase from 2020 onward, despite that
the global car sales are forecast to decline again this year. More
importantly for Himax, the market is quickly shifting towards a
number of new technologies including higher resolution, in-cell
touch, slim border, giant pillar-to-pillar screen, local dimming
for higher contrast, and plastic AMOLED for free form design, all
of which are contributing to an increase in market size and demand
for automotive display driver ICs. Himax commands more than 30% of
the global automotive display driver IC market and is the primary
partner for most of the world’s automotive panel makers to enable
the new technologies above. It’s worth mentioning that Himax is
also the dominant automotive TDDI technology provider, working as
the sole supplier on numerous TDDI design-in projects across
different leading panel makers. While the Company expects only
small volume shipments in 2020, it anticipates meaningful volume of
automotive TDDI as it moves into 2021.
Himax expects the tablet business to be a major
growth area for the Company during 2020 with a significant volume
of tablet TDDI shipment starting from Q1. The strong momentum will
accelerate into Q2 and throughout 2020. The business growth will be
driven primarily by leading non-iOS brands’ rapid adoption of the
newly developed in-cell TDDI solutions. In-cell TDDI is quickly
becoming mainstream for tablets due to its lower cost and a
simplified supply chain as well as faster and easier integration
for display manufacturers. At the same time, consumer demand is
expected to accelerate for these cheaper, slimmer, lighter and more
stylish tablets. Himax is the primary partner for all non-iOS
tablet in-cell TDDI products right now and is already making
shipments of its new in-cell TDDI products for tablet to a number
of leading end customers, some of which include active stylus.
Additionally, the Company continues shipping its traditional
display driver IC with CoF packaging for larger-sized tablets with
slim bezel design to a leading Chinese brand customer and expect
the momentum for these high-end designs to accelerate throughout
2020.
For the first quarter, revenue for the small and
medium-sized driver IC business is expected to increase by around
10% to 20% sequentially.
Non-Driver Product
CategoriesWLOThe fourth quarter shipments
were very strong, up by over 20% compared to the same period last
year, despite a modest decline from the previous quarter. The
momentum led to higher capacity utilization and, together with an
improved production yield, helped enhance corporate gross margin
for the quarter. According to its anchor customer’s shipment
forecast, Himax expects a very strong Q1 with double the shipment
volume compared to the same period last year, although Q1 shipment
volume is expected to decrease slightly on a sequential basis.
Himax continues to make progress with its ongoing R&D projects
for next generation products centered around the Company’s
exceptional design know-how and mass production expertise in WLO
technology.
3D SensingIn the smartphone
segment, Himax has advanced its WLO optics solution to cover both
structured light and time-of-flight (ToF) 3D sensing. The Company
is seeing increasing ToF adoption by smartphone makers for
world-facing cameras to enable advanced photography,
distance/dimension measurement and 3D depth information generation
for AR. In the past few months, Himax has been actively working
with an industry leading ToF 3D camera vendor to develop a new and
advanced ToF solution, targeting Android smartphones. Leveraging
on its WLO technology, the Company has made great progress
providing the partner with spot projector for their reference
design which will be ready for leading Android smartphone makers’
evaluation as soon as Q1 2020.
The Company’s non-smartphone 3D-sensing
engagements have focused on smart door lock and industrial
automation segments where it provides structured light-based 3D
sensing total solution. Himax has been collaborating closely mainly
with two types of partners: those with industry-leading expertise
in facial recognition algorithm and those offering application
processors with strong AI capability. The Company has started
design-in projects with several smart door lock end customers.
Separately, as the Company previously mentioned, it is working with
partners who wish to take advantage of the Company’s 3D
sensing know-how to automate traditional manufacturing to improve
efficiency and reducing cost. One market opportunity the Company is
pursuing is shoe factory automation. Himax is pleased to report
that prototypes of 3D sensing enabled automatic robotic cementing
system are available now for production optimization testing.
Ultra-low power smart
sensingWiseEye is the Company’s AI-based ultra-low power
smart sensing solution. The demand for battery-powered smart device
with AI intelligent sensing is rapidly growing. The Company’s total
solution is built on Emza’s unique AI-based algorithm, on top of
Himax’s proprietary computer vision processor and CMOS image
sensor, all equipped with ultra-low power design. Currently laptop
is the market of focus. Himax WiseEye 2.0 NB solution provides a
‘laptop-ready’ 3-in-1 RGB/IR/AI solution, respecting privacy while
enhancing security for notebook users. At the CES 2020, a number of
notebook OEMs and ODMs demonstrated Himax’s WiseEye NB solution in
their next generation premium notebooks with positive feedback. In
addition to notebook, the Company has also made progress in the
displays and IoT markets. Innolux, one of the world's leading
manufacturers of TFT-LCD displays, has integrated the Himax-Emza
WiseEye solution into displays to enable consumer privacy
protection in real time. Also, Chicony, one of the largest ODMs in
the world, and Emza jointly announced a reference design of the
world’s first battery-powered human sensing solution for IoT in
December 2019. Both Innolux and Chicony showcased their products at
CES.
Previously the Company has mentioned that, in
addition to total solution, Himax is also able to offer ultra-low
power smart sensing on the basis of individual parts so as to
address the market’s different needs and maximize the potential
opportunities for Himax. It will elaborate on this in the CMOS
image sensor discussion below.
CMOS Image SensorCMOS image
sensor is another critical part of the WiseEye 2.0 NB solution. To
support the lean camera design and high-quality image needed for
thin bezel laptops, Himax has made a 2-in-1 sensor that offers the
duo capabilities of high quality HD image capturing and
ultra-low-power, low resolution visual sensing in one single
sensor, the industry’s first with the innovative design. With this
sensor, laptop makers can simplify their next generation product
design and save costs by eliminating the need for an additional
camera to provide context awareness for a better user experience.
Himax’s sensor has also incorporated an RGB-IR design to enable
Windows Hello facial recognition. This new 2-in-1 CMOS sensor is
currently available for its partners/customers.
In addition, Himax recently announced the
commercial availability of an industry-first ultra-low power and
low latency, backside-illuminated CMOS image sensor solution with
autonomous modes of operations for always-on, intelligent visual
sensing applications such as human presence detection and tracking,
gaze detection, behavioral analysis, and pose estimation for
growing markets such as smart home, smart building, healthcare,
smartphone and AR/VR devices.
Himax is collaborating with leading partners
within the ecosystem to reduce time to market for intelligent edge
vision solutions. Notably, the Company is working closely with
Google and has become the reference design for its world-leading
TensorFlow Lite AI framework targeting low power edge devices.
For the traditional human vision segments, Himax
sees strong demand in notebooks, where the Company is one of the
market leaders, and has experienced increased shipments for
multimedia applications such as car recorders, surveillance,
drones, home appliances, and consumer electronics, among others.
Additionally, Himax has seen increased shipments and new
design-wins in the automotive segment covering before-market
solutions such as surround view and rear-view camera.
LCOSHimax continues to focus on
AR goggle devices and head-up-displays (HUD) for automotive. Many
of its industry-leading customers have demonstrated their
state-of-the-art products, including holographic HUD, AR glasses
and LiDAR system, with Himax LCOS technology inside at the 2020 CES
with extremely positive market feedbacks. Himax’s technology
leadership and proven manufacturing expertise have made the Company
a preferred partner for customers in these emerging markets and
their ongoing engineering projects in AR goggles and HUD for
automotive applications.
For non-driver IC business, the Company expects
revenue to decrease by single digit sequentially in the first
quarter. Aside from the WLO sales which are expected to be
down slightly, the CMOS image sensor sales for multimedia markets
have been affected by the coronavirus incident as the operations of
many of the customers here are still not back in order.
First Quarter 2020 Guidance |
The Company is providing the following financial
guidance for the first quarter of 2020: |
Net
Revenue: |
To
increase between 1.0% to 10.0% sequentially, an
increase of 8.2% to 17.8% year-over-year |
Gross Margin: |
To increase by 1.0% to 2.0% sequentially, depending
on final product mix |
IFRS Profit |
To be around -0.5 cents to 1.8 cents per diluted
ADS |
Non-IFRS Profit(1): |
To be around -0.2 cents to 2.1 cents per diluted ADS |
(1) Non-IFRS Profit excludes share-based
compensation and acquisition-related charges |
Historically, due to the Lunar New Year
holidays, the first quarter has seasonally been the slowest period
of the year in terms of sales, often down by more than 10%
sequentially. At this time, however, based on the Company’s current
pipeline, Himax is experiencing strong sales in the first quarter,
brushing aside the seasonal factor.
However, the coronavirus outbreak currently
taking place in China and all over the world does represent a major
uncertainty to Himax’s operations, especially for the short term.
The Company is working extremely closely with both its customers
and suppliers in joint efforts to mitigate the risks. Himax has
started to see some downward adjustments of Q1 forecast over the
past week, mainly from certain China-based customers for smartphone
display drivers and CMOS image sensors who are still scrambling to
restore their operations into order. Himax’s Q1 guidance has taken
into account those downward adjustments. In comparison, Himax is
seeing relatively little impact of forecast from large display
customers who are demanding that Himax’s supply be uninterrupted by
the incident. With vast majority of operations located outside of
China, the Company’s suppliers are largely unaffected by the
coronavirus outbreak. The focus there is primarily the logistics
management including the customs operations in various ports in
China. It is worth pointing out that, Himax has very little
short-term exposure, on both customer and supplier sides and in
terms of its own operations, to Wuhan and the Hubei Province, the
epicenter of the outbreak.
The situation is still evolving. On top of the
downward adjustments of forecast the Company has seen, Himax has
deliberately widened and reduced the low end of this quarter’s
guidance to reflect the potential risk associated with the
coronavirus outbreak.
HIMAX TECHNOLOGIES FOURTH
QUARTER AND FULL YEAR 2019 EARNINGS CONFERENCE
CALL |
DATE: |
Thursday, February 13th, 2020 |
TIME: |
U.S. |
8:00 a.m.
EST |
|
Taiwan |
9:00 p.m. |
DIAL IN: |
U.S. |
+1 (866) 444-9147 |
|
INTERNATIONAL |
+1 (678) 509-7569 |
CONFERENCE ID: |
8736988 |
WEBCAST: |
https://edge.media-server.com/mmc/p/xrp4e4z5 |
A replay of the call will be available beginning
two hours after the call through 11:30 a.m. US EST on February
21st, 2020 (12:30 a.m. Taiwan time, February 22nd, 2020) on
www.himax.com.tw and by telephone at +1 (855) 859-2056 (US
Domestic) or +1 (404) 537-3406 (International). The conference ID
number is 8736988. This call is being webcast by Nasdaq and can be
accessed by clicking on this link or Himax’s website, where the
webcast can be accessed through February 13th, 2021.
About Himax Technologies, Inc.
Himax Technologies, Inc. (NASDAQ: HIMX) is a
fabless semiconductor solution provider dedicated to display
imaging processing technologies. Himax is a worldwide market leader
in display driver ICs and timing controllers used in TVs, laptops,
monitors, mobile phones, tablets, digital cameras, car navigation,
virtual reality (VR) devices and many other consumer electronics
devices. Additionally, Himax designs and provides controllers for
touch sensor displays, in-cell Touch and Display Driver Integration
(TDDI) single-chip solutions, LED driver ICs, power management ICs,
scaler products for monitors and projectors, tailor-made video
processing IC solutions, silicon IPs and LCOS micro-displays for
augmented reality (AR) devices and heads-up displays (HUD) for
automotive. The Company also offers digital camera solutions,
including CMOS image sensors and wafer level optics for AR devices,
3D sensing and machine vision, which are used in a wide variety of
applications such as mobile phone, tablet, laptop, TV, PC camera,
automobile, security, medical devices, home appliance and Internet
of Things. Founded in 2001 and headquartered in Tainan, Taiwan,
Himax currently employs around 2,000 people from three Taiwan-based
offices in Tainan, Hsinchu and Taipei and country offices in China,
Korea, Japan, Israel, and the US. Himax has 2,922 patents granted
and 575 patents pending approval worldwide as of December 31st,
2019. Himax has retained its position as the leading display
imaging processing semiconductor solution provider to consumer
electronics brands worldwide.
http://www.himax.com.tw
Forward Looking Statements
Factors that could cause actual events or
results to differ materially include, but not limited to, general
business and economic conditions and the state of the semiconductor
industry; market acceptance and competitiveness of the driver and
non-driver products developed by the Company; demand for end-use
applications products; reliance on a small group of principal
customers; the uncertainty of continued success in technological
innovations; our ability to develop and protect our intellectual
property; pricing pressures including declines in average selling
prices; changes in customer order patterns; changes in estimated
full-year effective tax rate; shortages in supply of key
components; changes in environmental laws and regulations; exchange
rate fluctuations; regulatory approvals for further investments in
our subsidiaries; our ability to collect accounts receivable and
manage inventory and other risks described from time to time in the
Company's SEC filings, including those risks identified in the
section entitled "Risk Factors" in its Form 20-F for the year ended
December 31, 2018 filed with the SEC, as may be amended.
Company Contacts:
Jackie Chang, CFOHimax
Technologies, Inc.Tel: +886-2-2370-3999 Ext.22300 OrUS Tel:
+1-949-585-9838 Ext.252Fax: +886-2-2314-0877Email:
jackie_chang@himax.com.twwww.himax.com.tw
Sky Wang, Investor RelationsHimax Technologies,
Inc.US Tel: +1-949-585-9838 Ext.223Fax: +1-312-445-3643Email:
sky_wang@himax.com.twwww.himax.com.tw
Investor Relations - US RepresentativeMaili
Bergman, Managing DirectorMZ North AmericaTel: 949-298-4320Email:
HIMX@mzgroup.uswww.mzgroup.us
-Financial Tables-
Himax Technologies, Inc. |
Unaudited Condensed Consolidated Statements of
Profit or
Loss |
(These interim financials do not fully comply with
IFRS because they omit all interim
disclosure required by
IFRS) |
(Amounts in Thousands of U.S. Dollars, Except
Share and Per Share Data) |
|
|
Three Months
Ended December 31, |
|
Three Months Ended
September 30, |
|
2019 |
|
2018 |
|
2019 |
|
|
|
|
|
|
Revenues |
$ |
174,929 |
|
|
$ |
191,006 |
|
|
$ |
164,254 |
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
Cost of revenues |
|
138,838 |
|
|
|
144,624 |
|
|
|
132,239 |
|
Research and development |
|
27,044 |
|
|
|
30,424 |
|
|
|
29,156 |
|
General and administrative |
|
5,942 |
|
|
|
5,650 |
|
|
|
6,053 |
|
Sales and marketing |
|
4,449 |
|
|
|
4,969 |
|
|
|
4,447 |
|
Total costs and expenses |
|
176,273 |
|
|
|
185,667 |
|
|
|
171,895 |
|
|
|
|
|
|
|
Operating income (loss) |
|
(1,344 |
) |
|
|
5,339 |
|
|
|
(7,641 |
) |
|
|
|
|
|
|
Non operating income
(loss): |
|
|
|
|
|
Interest income |
|
521 |
|
|
|
605 |
|
|
|
416 |
|
Changes in fair value of financial assets at fair value through
profit or loss |
|
3,740 |
|
|
|
2,104 |
|
|
|
(1 |
) |
Foreign currency exchange gains (losses), net |
|
(947 |
) |
|
|
(68 |
) |
|
|
91 |
|
Finance costs |
|
(670 |
) |
|
|
(337 |
) |
|
|
(634 |
) |
Share of profits (losses) of associates |
|
(381 |
) |
|
|
1,397 |
|
|
|
(135 |
) |
Other income |
|
62 |
|
|
|
176 |
|
|
|
19 |
|
|
|
2,325 |
|
|
|
3,877 |
|
|
|
(244 |
) |
Profit (loss) before income
taxes |
|
981 |
|
|
|
9,216 |
|
|
|
(7,885 |
) |
Income tax expense |
|
416 |
|
|
|
1,390 |
|
|
|
- |
|
Profit (loss) for the period |
|
565 |
|
|
|
7,826 |
|
|
|
(7,885 |
) |
Loss
attributable to noncontrolling interests |
|
471 |
|
|
|
637 |
|
|
|
705 |
|
Profit (loss)
attributable to Himax Technologies, Inc. stockholders |
$ |
1,036 |
|
|
$ |
8,463 |
|
|
$ |
(7,180 |
) |
|
|
|
|
|
|
Basic earnings (loss) per ADS attributable to Himax
Technologies, Inc. stockholders |
$ |
0.006 |
|
|
$ |
0.049 |
|
|
$ |
(0.042 |
) |
Diluted earnings
(loss) per ADS attributable to Himax Technologies, Inc.
stockholders* |
$ |
0.006 |
|
|
$ |
0.049 |
|
|
$ |
(0.042 |
) |
|
|
|
|
|
|
Basic Weighted Average Outstanding ADS |
|
172,579 |
|
|
|
172,540 |
|
|
|
172,541 |
|
Diluted Weighted Average Outstanding ADS |
|
172,579 |
|
|
|
172,556 |
|
|
|
172,541 |
|
|
* The diluted loss per ADS was not calculated because the potential
ordinary shares are antidilutive. |
|
|
Himax Technologies, Inc. |
Unaudited Condensed Consolidated Statements of Profit or
Loss |
(Amounts in Thousands of U.S. Dollars, Except Share and Per
Share Data) |
|
|
Twelve Months Ended December
31, |
|
2019 |
|
2018 |
|
|
|
|
Revenues |
$ |
671,835 |
|
|
$ |
723,605 |
|
|
|
|
|
Costs and expenses: |
|
|
|
Cost of revenues |
|
533,916 |
|
|
|
554,690 |
|
Research and development |
|
114,859 |
|
|
|
123,037 |
|
General and administrative |
|
23,672 |
|
|
|
21,823 |
|
Sales and marketing |
|
17,695 |
|
|
|
20,670 |
|
Total costs and expenses |
|
690,142 |
|
|
|
720,220 |
|
|
|
|
|
Operating income (loss) |
|
(18,307 |
) |
|
|
3,385 |
|
|
|
|
|
Non operating income
(loss): |
|
|
|
Interest income |
|
2,013 |
|
|
|
2,429 |
|
Changes in fair value of financial assets at fair value through
profit or loss |
|
3,746 |
|
|
|
2,036 |
|
Foreign currency exchange losses, net |
|
(546 |
) |
|
|
(369 |
) |
Finance costs |
|
(2,325 |
) |
|
|
(1,232 |
) |
Share of losses of associates |
|
(477 |
) |
|
|
(1,095 |
) |
Other income |
|
128 |
|
|
|
1,866 |
|
|
|
2,539 |
|
|
|
3,635 |
|
Profit (loss) before income
taxes |
|
(15,768 |
) |
|
|
7,020 |
|
Income tax expense |
|
416 |
|
|
|
994 |
|
Profit (loss) for the period |
|
(16,184 |
) |
|
|
6,026 |
|
Loss
attributable to noncontrolling interests |
|
2,570 |
|
|
|
2,543 |
|
Profit (loss)
attributable to Himax Technologies, Inc. stockholders |
$ |
(13,614 |
) |
|
$ |
8,569 |
|
|
|
|
|
Basic earnings (loss) per ADS attributable to Himax
Technologies, Inc. stockholders |
$ |
(0.079 |
) |
|
$ |
0.050 |
|
Diluted earnings
(loss) per ADS attributable to Himax Technologies, Inc.
stockholders* |
$ |
(0.079 |
) |
|
$ |
0.050 |
|
|
|
|
|
Basic Weighted Average Outstanding ADS |
|
172,550 |
|
|
|
172,510 |
|
Diluted Weighted Average Outstanding ADS |
|
172,550 |
|
|
|
172,534 |
|
|
* The diluted loss per ADS was not calculated because the potential
ordinary shares are antidilutive. |
|
|
Himax Technologies, Inc. |
Unaudited Supplemental Financial Information
|
(Amounts in Thousands of U.S. Dollars) |
|
The amount of
share-based compensation included in applicable
statements of profit or loss categories is
summarized as follows: |
Three Months Ended December
31, |
|
Three MonthsEnded
September 30, |
|
2019 |
|
2018 |
|
2019 |
Share-based compensation |
|
|
|
|
|
Cost of revenues |
$ |
9 |
|
|
$ |
- |
|
|
$ |
- |
|
Research and development |
|
253 |
|
|
|
13 |
|
|
|
60 |
|
General and administrative |
|
24 |
|
|
|
2 |
|
|
|
22 |
|
Sales and marketing |
|
40 |
|
|
|
4 |
|
|
|
10 |
|
Income tax benefit |
|
(59 |
) |
|
|
(4 |
) |
|
|
(21 |
) |
Total |
$ |
267 |
|
|
$ |
15 |
|
|
$ |
71 |
|
|
|
|
|
|
|
The amount of
acquisition-related charges included in
applicable statements of profit or loss
categories is summarized as follows: |
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
charges |
|
|
|
|
|
Research and development |
$ |
275 |
|
|
$ |
310 |
|
|
$ |
276 |
|
Income tax benefit |
|
(65 |
) |
|
|
(78 |
) |
|
|
(64 |
) |
Total |
$ |
210 |
|
|
$ |
232 |
|
|
$ |
212 |
|
|
|
|
|
|
|
|
Himax Technologies, Inc. |
Unaudited Supplemental Financial Information |
(Amounts in Thousands of U.S. Dollars) |
|
The amount of
share-based compensation included in applicable
statements of profit or loss categories is
summarized as follows: |
Twelve Months Ended December
31, |
|
2019 |
|
2018 |
Share-based compensation |
|
|
|
Cost of revenues |
$ |
9 |
|
|
$ |
90 |
|
Research and development |
|
339 |
|
|
|
3,165 |
|
General and administrative |
|
50 |
|
|
|
387 |
|
Sales and marketing |
|
59 |
|
|
|
544 |
|
Income tax benefit |
|
(89 |
) |
|
|
(894 |
) |
Total |
$ |
368 |
|
|
$ |
3,292 |
|
|
|
|
|
The amount of
acquisition-related charges included in
applicable statements of profit or loss
categories is summarized as follows: |
|
|
|
|
|
|
|
Acquisition-related
charges |
|
|
|
Research and development |
$ |
1,492 |
|
|
$ |
1,433 |
|
Income tax benefit |
|
(374 |
) |
|
|
(387 |
) |
Total |
$ |
1,118 |
|
|
$ |
1,046 |
|
|
|
|
|
|
Himax Technologies, Inc. |
IFRS Unaudited Condensed
Consolidated
Statements
of Financial
Position |
(Amounts in Thousands of U.S. Dollars) |
|
|
December 31,
2019 |
|
September
30,
2019 |
|
December
31,2018 |
Assets |
|
|
|
|
|
Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
101,055 |
|
|
$ |
116,579 |
|
|
$ |
106,437 |
|
Financial assets at amortized cost |
|
11,049 |
|
|
|
11,278 |
|
|
|
11,229 |
|
Financial assets at fair value through profit or loss |
|
- |
|
|
|
97 |
|
|
|
- |
|
Accounts receivable, net |
|
164,943 |
|
|
|
157,320 |
|
|
|
189,279 |
|
Inventories |
|
143,774 |
|
|
|
167,581 |
|
|
|
162,561 |
|
Income taxes receivable |
|
88 |
|
|
|
55 |
|
|
|
72 |
|
Restricted deposit |
|
164,000 |
|
|
|
164,000 |
|
|
|
164,326 |
|
Other receivable from related parties |
|
1,200 |
|
|
|
1,200 |
|
|
|
2,780 |
|
Other current assets |
|
18,559 |
|
|
|
19,732 |
|
|
|
17,731 |
|
Total current assets |
|
604,668 |
|
|
|
637,842 |
|
|
|
654,415 |
|
Financial assets at
fair value through profit or loss |
|
13,500 |
|
|
|
9,761 |
|
|
|
9,768 |
|
Financial assets at
fair value through other comprehensive
income |
|
709 |
|
|
|
703 |
|
|
|
791 |
|
Equity method
investments |
|
3,746 |
|
|
|
4,036 |
|
|
|
4,064 |
|
Property, plant and
equipment, net |
|
138,938 |
|
|
|
141,835 |
|
|
|
111,067 |
|
Deferred tax
assets |
|
14,433 |
|
|
|
13,389 |
|
|
|
13,904 |
|
Goodwill |
|
28,138 |
|
|
|
28,138 |
|
|
|
28,138 |
|
Other
intangible assets, net |
|
8,750 |
|
|
|
9,161 |
|
|
|
10,778 |
|
Restricted
deposit |
|
133 |
|
|
|
128 |
|
|
|
130 |
|
Other non-current
assets |
|
5,466 |
|
|
|
2,149 |
|
|
|
3,623 |
|
|
|
213,813 |
|
|
|
209,300 |
|
|
|
182,263 |
|
Total assets |
$ |
818,481 |
|
|
$ |
847,142 |
|
|
$ |
836,678 |
|
Liabilities
and Equity |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Unsecured borrowings |
$ |
57,339 |
|
|
$ |
90,606 |
|
|
$ |
20,000 |
|
Secured borrowings |
|
164,000 |
|
|
|
164,000 |
|
|
|
164,000 |
|
Financial liability at amortized cost |
|
- |
|
|
|
- |
|
|
|
5,071 |
|
Accounts payable |
|
114,320 |
|
|
|
114,825 |
|
|
|
150,500 |
|
Income taxes payable |
|
2,903 |
|
|
|
1,618 |
|
|
|
6,007 |
|
Other payable to related party |
|
2,220 |
|
|
|
2,620 |
|
|
|
3,797 |
|
Other current liabilities |
|
40,108 |
|
|
|
37,458 |
|
|
|
41,780 |
|
Total current liabilities |
|
380,890 |
|
|
|
411,127 |
|
|
|
391,155 |
|
Net defined benefit
liabilities |
|
50 |
|
|
|
149 |
|
|
|
151 |
|
Deferred tax
liabilities |
|
1,394 |
|
|
|
1,440 |
|
|
|
1,759 |
|
Other non-current
liabilities |
|
4,903 |
|
|
|
4,471 |
|
|
|
1,326 |
|
|
|
6,347 |
|
|
|
6,060 |
|
|
|
3,236 |
|
Total liabilities |
|
387,237 |
|
|
|
417,187 |
|
|
|
394,391 |
|
Equity |
|
|
|
|
|
Ordinary shares |
|
107,010 |
|
|
|
107,010 |
|
|
|
107,010 |
|
Additional paid-in capital |
|
105,150 |
|
|
|
104,829 |
|
|
|
104,749 |
|
Treasury shares |
|
(8,764 |
) |
|
|
(8,764 |
) |
|
|
(8,819 |
) |
Accumulated other comprehensive income |
|
(952 |
) |
|
|
(1,334 |
) |
|
|
(549 |
) |
Retained earnings |
|
230,543 |
|
|
|
229,507 |
|
|
|
244,157 |
|
Equity attributable to owners of Himax
Technologies, Inc. |
|
432,987 |
|
|
|
431,248 |
|
|
|
446,548 |
|
Noncontrolling
interests |
|
(1,743 |
) |
|
|
(1,293 |
) |
|
|
(4,261 |
) |
Total equity |
|
431,244 |
|
|
|
429,955 |
|
|
|
442,287 |
|
Total liabilities and equity |
$ |
818,481 |
|
|
$ |
847,142 |
|
|
$ |
836,678 |
|
|
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in
Thousands of
U.S.
Dollars) |
|
|
Three Months Ended December
31, |
|
Three MonthsEnded September
30, |
|
2019 |
|
2018 |
|
2019 |
|
|
|
|
|
|
Cash flows from
operating activities: |
|
|
|
|
|
Profit (loss) for the period |
$ |
565 |
|
|
$ |
7,826 |
|
|
$ |
(7,885 |
) |
Adjustments for: |
|
|
|
|
|
Depreciation and amortization |
|
5,866 |
|
|
|
4,869 |
|
|
|
6,004 |
|
Expected credit loss recognized on accounts receivable |
|
67 |
|
|
|
100 |
|
|
|
- |
|
Share-based compensation expenses |
|
326 |
|
|
|
19 |
|
|
|
92 |
|
Gain on disposal of property, plant and equipment, net |
|
(84 |
) |
|
|
- |
|
|
|
- |
|
Changes in fair value of financial assets at fair value through
profit or loss |
|
(3,740 |
) |
|
|
(2,104 |
) |
|
|
1 |
|
Interest income |
|
(521 |
) |
|
|
(605 |
) |
|
|
(416 |
) |
Finance costs |
|
670 |
|
|
|
337 |
|
|
|
634 |
|
Income tax expense |
|
416 |
|
|
|
1,390 |
|
|
|
- |
|
Share of losses (profits) of associates |
|
381 |
|
|
|
(1,397 |
) |
|
|
135 |
|
Inventories write downs |
|
7,515 |
|
|
|
6,003 |
|
|
|
8,174 |
|
Unrealized foreign currency exchange losses |
|
53 |
|
|
|
9 |
|
|
|
182 |
|
|
|
11,514 |
|
|
|
16,447 |
|
|
|
6,921 |
|
Changes in: |
|
|
|
|
|
Accounts receivable |
|
(7,704 |
) |
|
|
(1,766 |
) |
|
|
18,905 |
|
Inventories |
|
16,292 |
|
|
|
(22,752 |
) |
|
|
12,780 |
|
Other receivable from related party |
|
- |
|
|
|
60 |
|
|
|
- |
|
Other current assets |
|
2,631 |
|
|
|
(583 |
) |
|
|
2,649 |
|
Accounts payable |
|
(505 |
) |
|
|
8,947 |
|
|
|
(19,399 |
) |
Other payable to related party |
|
(400 |
) |
|
|
1,547 |
|
|
|
260 |
|
Net defined benefit liabilities |
|
(44 |
) |
|
|
(99 |
) |
|
|
- |
|
Other current liabilities |
|
1,643 |
|
|
|
1,770 |
|
|
|
2,180 |
|
Other non-current liabilities |
|
50 |
|
|
|
(491 |
) |
|
|
200 |
|
Cash generated from operating activities |
|
23,477 |
|
|
|
3,080 |
|
|
|
24,496 |
|
Interest received |
|
745 |
|
|
|
916 |
|
|
|
213 |
|
Interest paid |
|
(697 |
) |
|
|
(216 |
) |
|
|
(639 |
) |
Income tax paid |
|
(84 |
) |
|
|
(1,445 |
) |
|
|
(86 |
) |
Net cash provided by operating activities |
|
23,441 |
|
|
|
2,335 |
|
|
|
23,984 |
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
Acquisitions of property, plant and equipment |
|
(2,729 |
) |
|
|
(5,218 |
) |
|
|
(31,222 |
) |
Proceeds from disposal of property, plant and equipment |
|
84 |
|
|
|
- |
|
|
|
- |
|
Acquisitions of intangible assets |
|
(38 |
) |
|
|
(582 |
) |
|
|
(18 |
) |
Acquisitions of financial assets at amortized cost |
|
(737 |
) |
|
|
(737 |
) |
|
|
(959 |
) |
Proceeds from disposal of financial assets at amortized cost |
|
1,137 |
|
|
|
1,556 |
|
|
|
1,896 |
|
Acquisitions of financial assets at fair value through profit or
loss |
|
(3,516 |
) |
|
|
(7,644 |
) |
|
|
(4,339 |
) |
Proceeds from disposal of financial assets at fair value through
profit or loss |
|
3,641 |
|
|
|
7,626 |
|
|
|
21,287 |
|
Proceeds from capital reduction of investment |
|
- |
|
|
|
55 |
|
|
|
17 |
|
Acquisitions of equity method investments |
|
- |
|
|
|
(2,093 |
) |
|
|
(129 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in
Thousands of
U.S.
Dollars) |
|
|
Three Months Ended December
31, |
|
Three Months Ended September
30, |
|
2019 |
|
2018 |
|
2019 |
|
|
|
|
|
|
Decrease (increase) in refundable deposits |
|
(2,909 |
) |
|
|
78 |
|
|
|
21 |
|
Releases (pledges) of restricted deposit |
|
(5 |
) |
|
|
3 |
|
|
|
323 |
|
Net cash used in investing activities |
|
(5,072 |
) |
|
|
(6,956 |
) |
|
|
(13,123 |
) |
|
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
|
Proceeds from unsecured borrowings |
|
67,218 |
|
|
|
20,000 |
|
|
|
60,000 |
|
Repayments of unsecured borrowings |
|
(100,621 |
) |
|
|
- |
|
|
|
(46,385 |
) |
Proceeds from secured borrowings |
|
27,000 |
|
|
|
27,000 |
|
|
|
67,000 |
|
Repayments of secured borrowings |
|
(27,000 |
) |
|
|
(27,000 |
) |
|
|
(67,000 |
) |
Payment of lease liabilities |
|
(601 |
) |
|
|
- |
|
|
|
(392 |
) |
Net cash provided by (used in) financing
activities |
|
(34,004 |
) |
|
|
20,000 |
|
|
|
13,223 |
|
Effect of
foreign currency exchange rate
changes on cash and cash equivalents |
|
111 |
|
|
|
112 |
|
|
|
(362 |
) |
Net
increase
(decrease) in
cash and cash equivalents |
|
(15,524 |
) |
|
|
15,491 |
|
|
|
23,722 |
|
Cash and cash
equivalents at beginning of period |
|
116,579 |
|
|
|
90,946 |
|
|
|
92,857 |
|
Cash and cash
equivalents at end of period |
$ |
101,055 |
|
|
$ |
106,437 |
|
|
$ |
116,579 |
|
|
|
|
|
|
|
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in
Thousands of
U.S.
Dollars) |
|
|
Twelve MonthsEnded December
31, |
|
2019 |
|
2018 |
|
|
|
|
Cash flows from
operating activities: |
|
|
|
Profit (loss) for the period |
$ |
(16,184 |
) |
|
$ |
6,026 |
|
Adjustments for: |
|
|
|
Depreciation and amortization |
|
24,399 |
|
|
|
20,327 |
|
Expected credit loss recognized on accounts receivable |
|
67 |
|
|
|
290 |
|
Share-based compensation expenses |
|
457 |
|
|
|
408 |
|
Gain on disposal of property, plant and equipment, net |
|
(90 |
) |
|
|
- |
|
Gain on re-measurement of the pre-existing relationships in a
business combination |
|
- |
|
|
|
(1,662 |
) |
Changes in fair value of financial assets at fair value through
profit or loss |
|
(3,746 |
) |
|
|
(2,036 |
) |
Interest income |
|
(2,013 |
) |
|
|
(2,429 |
) |
Finance costs |
|
2,325 |
|
|
|
1,232 |
|
Income tax expense |
|
416 |
|
|
|
994 |
|
Share of losses of associates |
|
477 |
|
|
|
1,095 |
|
Inventories write downs |
|
25,447 |
|
|
|
17,724 |
|
Unrealized foreign currency exchange losses |
|
121 |
|
|
|
294 |
|
|
|
31,676 |
|
|
|
42,263 |
|
Changes in: |
|
|
|
Accounts receivable |
|
23,992 |
|
|
|
(794 |
) |
Inventories |
|
(6,660 |
) |
|
|
(45,085 |
) |
Other current assets |
|
35 |
|
|
|
(1,511 |
) |
Accounts payable |
|
(36,180 |
) |
|
|
10,567 |
|
Other payable to related party |
|
(1,577 |
) |
|
|
1,597 |
|
Net defined benefit liabilities |
|
6 |
|
|
|
(128 |
) |
Other current liabilities |
|
866 |
|
|
|
753 |
|
Other non-current liabilities |
|
250 |
|
|
|
(458 |
) |
Cash generated from operating activities |
|
12,408 |
|
|
|
7,204 |
|
Interest received |
|
2,060 |
|
|
|
2,361 |
|
Interest paid |
|
(2,372 |
) |
|
|
(877 |
) |
Income tax paid |
|
(4,440 |
) |
|
|
(4,679 |
) |
Net cash provided by operating activities |
|
7,656 |
|
|
|
4,009 |
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Acquisitions of property, plant and equipment |
|
(45,922 |
) |
|
|
(49,672 |
) |
Proceeds from disposal of property, plant and equipment |
|
98 |
|
|
|
1 |
|
Acquisitions of intangible assets |
|
(152 |
) |
|
|
(925 |
) |
Acquisitions of financial assets at amortized cost |
|
(4,023 |
) |
|
|
(4,766 |
) |
Proceeds from disposal of financial assets at amortized cost |
|
4,171 |
|
|
|
3,514 |
|
Acquisitions of financial assets at fair value through profit or
loss |
|
(50,487 |
) |
|
|
(26,277 |
) |
Proceeds from disposal of financial assets at fair value through
profit or loss |
|
50,648 |
|
|
|
48,764 |
|
Acquisition of business |
|
(700 |
) |
|
|
(700 |
) |
Acquisition of a subsidiary, net of cash acquired |
|
(400 |
) |
|
|
(3,301 |
) |
Proceeds from capital reduction of investment |
|
47 |
|
|
|
55 |
|
|
|
|
|
|
|
|
|
|
Himax Technologies, Inc. |
Unaudited Condensed
Consolidated Statements of Cash Flows |
(Amounts in
Thousands of
U.S.
Dollars) |
|
|
Twelve MonthsEnded December
31, |
|
2019 |
|
2018 |
|
|
|
|
Acquisitions of equity method investments |
|
(129 |
) |
|
|
(2,093 |
) |
Decrease (increase) in refundable deposits |
|
(2,821 |
) |
|
|
87 |
|
Releases of restricted deposit |
|
323 |
|
|
|
14 |
|
Cash paid for loan made to related parties |
|
(1,200 |
) |
|
|
(780 |
) |
Cash received from loan made to related party |
|
2,780 |
|
|
|
- |
|
Income tax paid for disposal of financial assets at fair value
through profit or loss |
|
- |
|
|
|
(2,187 |
) |
Net cash used in investing activities |
|
(47,767 |
) |
|
|
(38,266 |
) |
|
|
|
|
Cash flows from
financing activities: |
|
|
|
Payments of cash dividends |
|
- |
|
|
|
(17,210 |
) |
Proceeds from issuance of new shares by subsidiary |
|
- |
|
|
|
11 |
|
Pledge of restricted deposit |
|
- |
|
|
|
(17,000 |
) |
Proceeds from unsecured borrowings |
|
244,224 |
|
|
|
40,000 |
|
Repayments of unsecured borrowings |
|
(207,006 |
) |
|
|
(20,000 |
) |
Proceeds from secured borrowings |
|
158,000 |
|
|
|
91,000 |
|
Repayments of secured borrowings |
|
(158,000 |
) |
|
|
(74,000 |
) |
Payment of lease liabilities |
|
(1,957 |
) |
|
|
- |
|
Net cash provided by financing activities |
|
35,261 |
|
|
|
2,801 |
|
Effect of
foreign currency exchange rate
changes on cash and cash equivalents |
|
(532 |
) |
|
|
(130 |
) |
Net
decrease in cash and cash
equivalents |
|
(5,382 |
) |
|
|
(31,586 |
) |
Cash and cash
equivalents at beginning of period |
|
106,437 |
|
|
|
138,023 |
|
Cash and cash
equivalents at end of period |
$ |
101,055 |
|
|
$ |
106,437 |
|
|
|
Himax Technologies, Inc. |
Non-IFRS Unaudited
Supplemental Data – Reconciliation Schedule |
(Amounts in Thousands of U.S. Dollars) |
|
Gross
Margin, Operating Margin and Net Margin Excluding
Share-Based Compensation and
Acquisition-Related Charges: |
|
Three Months Ended December
31, |
|
Three Months Ended September
30, |
|
2019 |
|
2018 |
|
2019 |
Revenues |
$ |
174,929 |
|
|
$ |
191,006 |
|
|
$ |
164,254 |
|
Gross profit |
|
36,091 |
|
|
|
46,382 |
|
|
|
32,015 |
|
Add: Share-based compensation
– cost of revenues |
|
9 |
|
|
|
- |
|
|
|
- |
|
Gross profit excluding
share-based compensation |
|
36,100 |
|
|
|
46,382 |
|
|
|
32,015 |
|
Gross margin excluding
share-based compensation |
|
20.6 |
% |
|
|
24.3 |
% |
|
|
19.5 |
% |
Operating income (loss) |
|
(1,344 |
) |
|
|
5,339 |
|
|
|
(7,641 |
) |
Add: Share-based
compensation |
|
326 |
|
|
|
19 |
|
|
|
92 |
|
Operating income (loss)
excluding share-based compensation |
|
(1,018 |
) |
|
|
5,358 |
|
|
|
(7,549 |
) |
Add: Acquisition-related
charges – intangible assets amortization |
|
275 |
|
|
|
310 |
|
|
|
276 |
|
Operating income (loss)
excluding share-based compensation and acquisition-related
charges |
|
(743 |
) |
|
|
5,668 |
|
|
|
(7,273 |
) |
Operating margin excluding
share-based compensation and acquisition-related charges |
|
(0.4 |
%) |
|
|
3.0 |
% |
|
|
(4.4 |
%) |
Profit (loss) attributable to
Himax Technologies, Inc. stockholders |
|
1,036 |
|
|
|
8,463 |
|
|
|
(7,180 |
) |
Add: Share-based compensation,
net of tax |
|
267 |
|
|
|
15 |
|
|
|
71 |
|
Add: Acquisition-related
charges, net of tax |
|
210 |
|
|
|
232 |
|
|
|
212 |
|
Profit (loss) attributable to
Himax Technologies, Inc. stockholders excluding share-based
compensation and acquisition-related charges |
|
1,513 |
|
|
|
8,710 |
|
|
|
(6,897 |
) |
Net margin attributable to
Himax Technologies, Inc. stockholders excluding share-based
compensation and acquisition-related charges |
|
0.9 |
% |
|
|
4.6 |
% |
|
|
(4.2 |
%) |
|
|
|
|
|
|
*Gross margin
excluding share-based compensation equals gross profit excluding
share-based compensation divided by revenues |
*Operating margin
excluding share-based compensation and acquisition-related charges
equals operating income (loss) excluding share-based compensation
and acquisition-related charges divided by revenues |
*Net margin
attributable to Himax Technologies, Inc. stockholders excluding
share-based compensation and acquisition-related charges equals
profit (loss) attributable to Himax Technologies, Inc. stockholders
excluding share-based compensation and acquisition-related charges
divided by revenues |
|
|
Himax Technologies, Inc. |
Non-IFRS Unaudited
Supplemental Data – Reconciliation Schedule |
(Amounts in Thousands of U.S. Dollars) |
|
Gross
Margin, Operating Margin and Net Margin Excluding
Share-Based Compensation and
Acquisition-Related Charges: |
|
Twelve Months Ended December
31, |
|
2019 |
|
2018 |
Revenues |
$ |
671,835 |
|
|
$ |
723,605 |
|
Gross profit |
|
137,919 |
|
|
|
168,915 |
|
Add: Share-based compensation
– cost of revenues |
|
9 |
|
|
|
90 |
|
Gross profit excluding
share-based compensation |
|
137,928 |
|
|
|
169,005 |
|
Gross margin excluding
share-based compensation |
|
20.5 |
% |
|
|
23.4 |
% |
Operating income (loss) |
|
(18,307 |
) |
|
|
3,385 |
|
Add: Share-based
compensation |
|
457 |
|
|
|
4,186 |
|
Operating income (loss)
excluding share-based compensation |
|
(17,850 |
) |
|
|
7,571 |
|
Add: Acquisition-related
charges – intangible assets amortization |
|
1,492 |
|
|
|
1,433 |
|
Operating income (loss)
excluding share-based compensation and acquisition-related
charges |
|
(16,358 |
) |
|
|
9,004 |
|
Operating margin excluding
share-based compensation and acquisition-related charges |
|
(2.4 |
%) |
|
|
1.2 |
% |
Profit (loss) attributable to
Himax Technologies, Inc. stockholders |
|
(13,614 |
) |
|
|
8,569 |
|
Add: Share-based compensation,
net of tax |
|
368 |
|
|
|
3,292 |
|
Add: Acquisition-related
charges, net of tax |
|
1,118 |
|
|
|
1,046 |
|
Profit (loss) attributable to
Himax Technologies, Inc. stockholders excluding share-based
compensation and acquisition-related charges |
|
(12,128 |
) |
|
|
12,907 |
|
Net margin attributable to
Himax Technologies, Inc. stockholders excluding share-based
compensation and acquisition-related charges |
|
(1.8 |
%) |
|
|
1.8 |
% |
|
|
|
|
*Gross margin
excluding share-based compensation equals gross profit excluding
share-based compensation divided by revenues |
*Operating margin
excluding share-based compensation and acquisition-related charges
equals operating income (loss) excluding share-based compensation
and acquisition-related charges divided by revenues |
*Net margin
attributable to Himax Technologies, Inc. stockholders excluding
share-based compensation and acquisition-related charges equals
profit (loss) attributable to Himax Technologies, Inc. stockholders
excluding share-based compensation and acquisition-related charges
divided by revenues |
|
|
Diluted
Earnings (Loss) Per ADS Attributable to Himax
Technologies, Inc. Stockholders Excluding Share-based Compensation
and Acquisition-Related Charges: (Amounts in U.S.
Dollars) |
|
|
Three
MonthsEnded December
31, |
|
Twelve MonthsEnded
December 31, |
|
2019 |
|
2019 |
Diluted IFRS earnings (loss) per
ADS attributable to Himax Technologies, Inc. stockholders |
$0.006 |
|
($0.079) |
Add: Share-based compensation per ADS |
$0.002 |
|
$0.002 |
Add: Acquisition-related charges per ADS |
$0.001 |
|
$0.006 |
|
|
|
|
Diluted non-IFRS earnings (loss)
per ADS attributable to Himax Technologies, Inc. stockholders
excluding share-based compensation and acquisition-related
charges |
$0.009 |
|
($0.070) |
|
|
|
|
Numbers do not add up due to rounding
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