2016 Q2 Financial Results

MediaTek Inc. Reports Second Quarter 2016 Consolidated Results

Consolidated Revenue

MediaTek Inc. today announced financial results of second-quarter ended June 30, 2016. Second quarter revenue was NT$72,527 million, up 29.7% sequentially, and up 54.2% year-over-year. The quarter-over-quarter growth was mainly due to increasing smartphone sales. The year-over-year growth was mainly due to higher mix of high-end consumer electronics and revenue recognition from acquired companies.

 

Consolidated Gross Profit and Gross Margin

The second-quarter gross profit was NT$25,553 million, up 19.9% sequentially and 18.3% year-over-year. Gross margin for the quarter was 35.2%, down 2.9 percentage points sequentially and 10.7 percentage points year-over-year. The quarter-over-quarter and the year-over-year decrease were mainly due to product mix and smartphone market competition.

 

Consolidated Operating Expenses

Operating expenses for the quarter was NT$18,484 million (25.5% of revenue), compared with NT$16,904 million (30.2% of revenue) in the previous quarter, and NT$14,730 million (31.3% of revenue) in the same period last year. The quarter-over-quarter increase was mainly due to higher expenses associated with higher sales. The year-over-year increase was mainly due to higher talent and technology investments as well as operating expenses recognition from acquired companies.

Operating expenses for the quarter included:

 

Consolidated Operating Income and Operating Margin

Operating income for the quarter was NT$7,069 million, up 60.5% sequentially, and up 3% year-over-year. Operating margin for the quarter was 9.7%, increased from 7.9% in the previous quarter, and decreased from 14.6% in the year-ago quarter.

 

Consolidated Non-operating Income (loss) and Income Tax

Non-operating income for the quarter was NT$682 million, or 0.9% of revenue. It was mainly from interest income and investment income recognized under the equity method. Income tax expense for the quarter was NT$1,162 million.

 

Consolidated Net Income, Net Profit Margin and EPS

Net income for the quarter was NT$6,590 million, up 47.3% sequentially, and up 3.3% year-over-year. Net profit margin for the quarter was 9.1%, increased from 8% in the previous quarter, and decreased from 13.6% in the year-ago quarter. EPS was NT$4.16, compared with NT$2.79 in the prior quarter and NT$4.06 in the year-ago quarter.

 

Consolidated Cash and Financial Assets-Current

Cash and financial assets-current at the end of the quarter was NT$172,084 million. This represents 45.7% of the company’s total assets. Cash and financial assets-current was NT$172,722 million and NT$203,124 million at the end of previous quarter and the year-ago quarter, respectively. Financial assets-current portfolio includes mutual funds, bonds and derivatives.

 

Consolidated Accounts Receivable

Accounts receivable (net) at the end of the quarter was NT$21,014 million. The accounts receivable turnover was 23 days based on quarterly average net receivables divided by annualized net revenue. The turnover was lower than 26 days in the last quarter and 25 days in the year-ago quarter.

 

Consolidated Inventory

Net inventory was NT$34,014 million at the end of the quarter. The inventory turnover was 59 days based on quarterly average inventory divided by annualized cost of goods sold. The turnover was lower than 67 days in the last quarter and 111 days in the year-ago quarter.

 

Consolidated Cash Flow from Operations                    

Net cash provided by operating activities during the quarter was NT$12,210 million, compared with NT$7,958 million in the prior quarter and net cash used in operating activities NT$1,446 million in the year-ago quarter.

 

Earnings Webcast

MediaTek will hold a public webcast today (August 3). A live webcast of the conference call will be available through the Investor Relations section of the MediaTek website. Investors who want to raise questions may use the toll number attached below.

 

Schedule and Webcast Links:

In Mandarin  2:00 – 3:00 p.m. (Taiwan Time)     

http://wms.gridow.com/ir/mediatek/tw/mediatek_2016Q2_tw.html

In English    4:00 – 5:00 p.m. (Taiwan Time)

http://wms.gridow.com/ir/mediatek/en/mediatek_2016Q2_en.html

Dial-in Number: +886-2-21928016   

Password: 587397#

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Since 1997, MediaTek has been a pioneering fabless semiconductor company and a market leader in cutting-edge systems-on-chip (SoC) for mobile devices, wireless networking, HDTV, DVD and Blu-ray. Our tightly-integrated, innovative chip designs help manufacturers optimize supply chains, reduce the development time of new products, and extend a competitive edge in both developing and mature markets around the world. Through MediaTek Labs, the company is also building a developer hub that will support device creation, application development, and services for the Internet of Things era. By building technologies that help connect individuals to the world around them, MediaTek is enabling people to expand their horizons and more easily achieve their goals. We believe anyone can achieve something amazing. And we believe they can do it every single day. We call this idea Everyday Genius and it drives everything we do. Visithttp://www.mediatek.com for more information.

  

MediaTek Inc.

Consolidated Income Statement

(In NT$ millions, except earnings per share)

    

2Q16

1Q16

2Q15

Q-Q

Y-Y

Net Sales

72,527

55,905

47,044

29.7%

54.2%

Operating costs

(46,974)

(34,598)

(25,448)

  

Gross Profit

25,553

21,307

21,596

19.9%

18.3%

  Selling expenses

(3,211)

(1,996)

(1,655)

  

  Administration expenses

(1,632)

(1,491)

(2,178)

  

  R&D expenses

(13,641)

(13,417)

(10,897)

  

Operating Expenses

(18,484)

(16,904)

(14,730)

  

Operating Income

7,069

4,403

6,866

60.5%

3.0%

Net Non-operating Income

682

875

541

  

Net Income Before Income Tax

7,751

5,278

7,407

  

  Income tax expense

(1,162)

(805)

(1,030)

  

Net Income

6,590

4,473

6,377

47.3%

3.3%

EPS Attributable to the Parent(NT$)

4.16

2.79

4.06

  

  Note: Numbers do not add up due to rounding.

 

Supplemental Information: Percentage of Revenue

 

2Q16

1Q16

2Q15

Gross profit

35.2%

38.1%

45.9%

  Selling expenses

(4.4 %) 

(3.6 %) 

(3.5 %) 

  Administration expenses

(2.3 %) 

(2.7 %) 

(4.6 %) 

  R&D expenses

(18.8 %) 

(24.0 %) 

(23.2 %) 

Operating profit

9.7%

7.9%

14.6%

  Non-operating income

0.9%

1.6%

1.1%

  Income tax expense

(1.6 %) 

(1.4 %) 

(2.2 %) 

Net profit

9.1%

8.0%

13.6%

 Note: Numbers do not add up due to rounding.

 

 

MediaTek Inc.

Consolidated Balance Sheet

 (In NT$ millions) 

 

2Q16

1Q16

2Q15

Cash & Financial assets-current

172,084

172,722

203,124

Accounts receivable

21,014

15,598

12,250

Inventories

34,014

27,027

33,654

Other current assets

11,342

7,250

7,113

Funds and investments

22,953

20,433

19,769

Intangible assets

73,806

74,587

63,907

Other non-current assets

41,146

39,388

31,539

Total assets

376,360

357,005

371,355

Short-term loans

60,849

48,026

57,491

Accounts payable

30,106

23,023

18,806

Other current liabilities

58,099

32,994

67,397

Total non-current liabilities

3,723

3,126

2,224

Total equity

223,583

249,837

225,438

 Note: Numbers do not add up due to rounding.

 

 

MediaTek Inc.

Consolidated Cash Flow Summary

(In NT$ millions) 

 

2Q16

1Q16

2Q15

Net cash provided by (used in) operating activities

12,210

7,958

(1,446)

Net cash provided by (used in) investing activities

(6,229)

(3,351)

(5,181)

Net cash provided by (used in) financing activities

(2,649)

107

6,633

Effect of changes in exchange rate on cash and cash equivalents

635

(2,031)

(325)

Net increase (decrease) in cash and cash equivalents

3,967

2,683

(319)

Cash and cash equivalents at the end of the period*

159,929

155,963

195,824

 Note: Numbers do not add up due to rounding.

*Cash and cash equivalents included non-current assets held for sale of NT$716 million.