MEMSIC, Inc. (NasdaqGM: MEMS), a leading MEMS sensing solution provider, today announced financial results for the third quarter ended September 30, 2012.

  • Net sales totaled $15.2 million compared to $18.4 million in the 2011 quarter.
  • Gross margin was 35.0% compared to 33.8% in the 2011 quarter.
  • Operating expenses totaled $5.7 million compared to $7.3 million in the 2011 quarter.
  • GAAP net loss was $0.3 million, or $0.01 per diluted share, compared to $0.4 million, or $0.02 per diluted share, in the 2011 quarter.
  • EBITDA was $952,000 compared to $915,000 in the 2011 quarter.

For the nine months ended September 30, 2012, net sales totaled $49.6 million compared to $46.7 million in the first nine months of 2011. Net income totaled $0.4 million, or $0.02 per diluted share, compared to a net loss of $2.8 million, or $0.12 per diluted share in the prior-year period. EBITDA totaled $4.2 million compared to $0.6 million in the 2011 period.

MEMSIC Chairman, President and CEO Dr. Yang Zhao commented, "We continued to grow sales in the consumer market from high-end digital camera applications and from new consumer applications such as tablet computers. We also benefited from design wins at multiple mobile customers in fast-growing smart phone applications in the China market. The increased sales in these areas helped ameliorate the impact of reduced shipments to a large mobile customer stemming from recent changes in MEMSIC's strategy and business focus.

"In the coming months, building on our superior magnetic sensor product, our large presence in the China market and the strong, local technical support we offer, we expect to continue to leverage the growth in the China mobile market. We are also moving forward with our launch of the gas flow sensor module, aimed at the residential and industrial meter markets, that we introduced in June 2012. In addition, we are developing high-performance sensor products for the industrial and automotive markets, as well as high-performance but cost-effective IMU product for industrial applications. Although expanding into new automotive and industrial applications will take time, we are optimistic that our advanced technology will lead the market and, in the long term, enhance the stability and profitability of our Company."

Outlook

  • Revenue is expected to be between $14 million and $16 million for the fourth quarter of 2012.
  • GAAP net loss is expected to be in the range of $0.02 to $0.04 per share for the fourth quarter of 2012.
  • Average diluted share count for the 2012 fourth quarter is estimated to be approximately 24.5 million.

Conference Call

Management will hold a conference call and webcast at 5:00 p.m. EST on Monday, November 5, 2012 to review and discuss the Company's results.

What:  

MEMSIC 3Q 2012 financial results conference call and webcast

 
When:

Monday, November 5, 2012

 
Time:

5:00 p.m. EST

 

 

Live Call:

(877) 291-1367, domestic

 

(914) 495-8534, international

 
Replay:

(855) 859-2056, pass code 46225789, domestic

(404) 537-3406, pass code 46225789, international

 
Webcast:

http://investor.memsic.com (live and replay)

 

About Non-GAAP Financial Information

EBITDA is a measure used by management to evaluate the Company's ongoing operations and as a general indicator of its operating cash flow (in conjunction with a cash flow statement that also includes, among other items, changes in working capital and the effect of non-cash charges). The Company defines EBITDA as net income, plus interest expense net of interest income, provision for income taxes, and depreciation and amortization. Management believes EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties in the comparative evaluation of companies. Because not all companies use identical calculations, the Company's presentation of EBITDA and EBITDA per share may not be comparable to similarly titled measures of other companies. EBITDA is not a recognized term under GAAP and does not purport to be an alternative to net income as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Additionally, EBITDA is not intended to be a measure of free cash flow for management's discretionary use as it does not reflect certain cash requirements such as interest payments, tax payments and debt service requirements.

Pursuant to the requirements of Regulation G, we have provided a reconciliation of EBITDA to GAAP net income as an exhibit to this release.

About MEMSIC, Inc.

MEMSIC, Inc., headquartered in Andover, Massachusetts, provides advanced semiconductor sensors and multi-sensor system solutions based on micro-electromechanical systems (MEMS) technology and sophisticated integration technologies in both the IC level and module level. MEMSIC's unique and proprietary approach combines leading-edge sensor technologies, such as magnetic sensors and accelerometers, with mixed signal processing circuitry to produce reliable, high quality, cost-effective solutions for the mobile phone, automotive, consumer, industrial, and general aviation markets. The company's shares are listed on the NASDAQ Stock Exchange (NASDAQ GM: MEMS).

Safe Harbor Statement

Statements included in this press release that are not historical in nature are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of the Company's management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements for reasons identified under the heading "Risk Factors" in the Company's most recent annual report on Form 10-K and other periodic reports filed with the Securities and Exchange Commission. The forward-looking statements contained in this press release are made as of the date hereof, and the Company does not undertake any obligation to update any forward-looking statements, whether as a result of future events, new information or otherwise.

 
MEMSIC, Inc.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
  September 30,   December 31,
  2012     2011  
 
ASSETS
Current assets:
Cash and cash equivalents $ 25,347,187 $ 51,914,128
Restricted cash 2,706,830 3,791,189
Short-term investments 33,640,012 6,814,728
Accounts receivable, net of allowance for doubtful accounts of $41,815 and $6,441,
respectively, as of September 30, 2012 and December 31, 2011 6,833,143 6,068,904
Inventories 9,775,070 11,459,153
Other current assets   2,751,586     2,050,787  
Total current assets 81,053,828 82,098,889
 
Property and equipment, net 29,488,751 30,998,489
Long-term investments 2,600,000 2,600,000
Goodwill 612,578 606,976
Intangible assets, net 10,133,406 11,091,532
Other assets   141,610     136,633  
Total assets $ 124,030,173   $ 127,532,519  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,332,101 $ 8,439,605
Accrued expenses 3,199,371 2,630,966
Advance research funding 2,706,830 3,791,189
Current portion of note payable to bank   1,000,000     500,000  
Total current liabilities 11,238,302 15,361,760
 
 
Note payable to bank, net of current portion 16,430,000 17,430,000
Building liability 8,064,310 8,161,288
Other liabilities   97,105     124,180  
Total other liabilities 24,591,415 25,715,468
 
Stockholders' equity:
 
Common stock, $0.00001 par value; authorized, 45,000,000 shares; 24,199,585 and 23,983,813
shares issued and outstanding at September 30, 2012 and December 31, 2011, respectively 242 240
 
Additional paid-in capital 102,556,701 101,266,272
Accumulated other comprehensive income 4,423,913 4,363,930
Accumulated deficit   (19,487,200 )   (19,908,135 )
MEMSIC, Inc. stockholders' equity 87,493,656 85,722,307
 
Non-controlling interest related to joint ventures   706,800     732,984  
Total stockholders' equity   88,200,456     86,455,291  
 
Total liabilities and stockholders' equity $ 124,030,173   $ 127,532,519  
           
MEMSIC, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 
Three months ended September 30, Nine months ended September 30,
  2012     2011     2012     2011  
 
Net sales $ 15,188,705 $ 18,357,300 $ 49,620,995 $ 46,684,854
Cost of goods sold   9,878,008     12,155,533     31,108,812     30,543,197  
Gross profit 5,310,697 6,201,767 18,512,183 16,141,657
 
Operating expenses:
Research and development 1,440,336 2,200,240 4,912,696 6,610,213
Sales and marketing 1,276,933 1,881,240 3,937,640 4,875,893
General and administrative 2,332,925 2,397,618 6,968,920 6,374,497
Depreciation 358,277 401,815 1,175,572 1,199,166
Amortization   338,879     403,835     1,148,887     1,212,001  
Total operating expenses   5,747,350     7,284,748     18,143,715     20,271,770  
 
Operating (loss) income (436,653 ) (1,082,981 ) 368,468 (4,130,113 )
 
Other income:
Interest and dividend income 4,378 153,227 237,412 335,082
Foreign exchange gain (loss) 209,628 328,639 (15,825 ) 848,114
Other, net   19,583     323,587     58,225     406,007  
Total other income 233,589 805,453 279,812 1,589,203
 
(Loss) profit before income taxes (203,064 ) (277,528 ) 648,280 (2,540,910 )
Provision for income taxes   96,462     58,343     194,400     172,653  
Net (loss) income (299,526 ) (335,871 ) 453,880 (2,713,563 )
 
Less: net income attributable to non-controlling interests   18,629     32,895     32,945     91,685  
Net (loss) income attributable to MEMSIC, Inc. $ (318,155 ) $ (368,766 ) $ 420,935   $ (2,805,248 )
 
Net (loss) income per common share attributable to MEMSIC, Inc.:
Basic $ (0.01 ) $ (0.02 ) $ 0.02   $ (0.12 )
Diluted $ (0.01 ) $ (0.02 ) $ 0.02   $ (0.12 )
 
Weighted average shares outstanding used in calculating
net (loss) income per common share:
Basic   24,024,725     23,825,134     23,985,453     23,822,587  
Diluted   24,024,725     23,825,134     24,414,565     23,822,587  
       
MEMSIC, Inc.

Reconciliation of Net (Loss) Income to Earnings Before Interest, Taxes and Depreciation and Amortization (EBITDA)

(Unaudited)

 
Three months ended September 30, Nine months ended September 30,
  2012     2011     2012     2011  
 

Net (loss) income

$ (318,155 ) $ (368,766 ) $ 420,935 $ (2,805,248 )
Interest (income) expense, net (4,378 ) (153,227 ) (237,412 ) (335,082 )
Income tax expense 96,462 58,343 194,400 172,653
Depreciation and amortization   1,177,613     1,378,401     3,791,360     3,533,403  
EBITDA $ 951,542   $ 914,751   $ 4,169,283   $ 565,726  

Company:
MEMSIC, Inc.
Patricia Niu, 978-738-0900
Chief Financial Officer
or
Investors:
LHA
Harriet Fried / Jody Burfening
212-838-3777
ir@memsic.com