Faroudja Inc. Announces Fourth Quarter and Full Year Results; Positive Trends Continue - Quarterly ProfitReported
January 27, 2000 04:20 PM
SUNNYVALE, Calif.--(BUSINESS WIRE)--Jan. 27, 2000--Faroudja, Inc. FDJA today reported results of operations for the fourth quarter and year ended December 31, 1999.
Revenues for the fourth quarter of 1999 were $3,877,000, a 52% increase over the fourth quarter 1998 revenues of $2,554,000, and slightly higher than third quarter revenues. For the fourth quarter, the Company reported net income of $77,000, or $.01 per share, on 12.7 million diluted shares, compared to a net loss of $902,000, or $.07 per share, on 12.2 million diluted shares in the fourth quarter of 1998.
For the year ended December 31,1999, Faroudja recorded revenues of $13,476,000 and a net loss of $2,099,000, or $.17 per share, on 12.3 million diluted shares. In 1998, the Company reported revenues of $12,270,000, a net loss of $3,469,000, or $.29 per share, on 12.1 million diluted shares.
As of December 31, 1999 the Company's balance sheet showed cash balances of $19,916,000 with net assets of $29,083,000. The balance sheet reflects the $7.3 million value at year-end of the Company's investment in Sage, Inc. stock, offset by $2.4 million of deferred revenue.
"Improved financial results for the last three sequential quarters in terms of revenue growth, and net income, clearly reflect healthy improvement in all of our business areas," said Glenn W. Marschel, Jr., President and CEO. "Our broadcast business strengthened throughout the year and revenue growth in our home theater and chip and licensing businesses were especially strong compared to last year.
"Digital video processor products introduced into our home theater line in the second quarter, the DVP2200 and DVP3000, continue to perform very well. At the Consumer Electronics Show (CES) earlier this month, the company showcased its new DVP5000 Digital Video Processor/Scaler - the first processor to automatically upconvert high definition 1080i content to 1080p. This flagship product is the latest example of the Company's leadership in image enhancement technology.
"Sales of our Digital Format Translator(TM)(DFT) upconverter products in the fourth quarter decreased slightly from third quarter levels. This was not surprising due to the fact that the last near-term FCC deadline passed early in the quarter. We are pleased that two prominent station groups, Raycom Media and Sinclair Broadcasting, joined the prestigious roster of DFT users during the quarter. The recently announced reseller agreements with three of the leading system integrators of broadcast equipment, Thomcast Communications Inc.'s Comark Division, Harris Corporation's Broadcast Communications Division and Communications Engineering Inc., are also expected to support continued growth in this area.
"We continue to execute on our strategy for developing and marketing highly integrated, high performance integrated circuit (IC) solutions for the emerging digital video display and computer/television convergence markets. Our fourth quarter results reflect the third quarterly shipment of FLI 9000 video processing chip sets for use by Mitsubishi Electric Corporation (Japan). Development of our next generation chip set has progressed with the second chip of our new three-chip set now at the sampling stage. Preliminary discussions with potential customers are very encouraging.
"Our project with Sage, Inc. is proceeding well. The $2.4 million in deferred revenue relating to Sage stock received as partial consideration for the Company's license of technology under our license and joint development agreement will be recognized in the first quarter of 2000.
"We continue to explore avenues for rapidly expanding our chip and licensing business through other strategic relationships that complement our internal development efforts."
A conference call to discuss these results will be held at 5 pm Eastern time/ 2 pm Pacific time. The call-in number is 888.209.3771.
Faroudja, Inc. FDJA is a world leader in high performance video processing technologies for markets requiring superior image quality solutions. The company provides innovative products for the HDTV broadcast, home theater, digital television and PC/TV convergence markets. Faroudja's technologies are protected by more than 60 patents. Faroudja has received numerous awards, including an Emmy award for Engineering Development and a Lifetime Achievement Emmy presented in June 1998 to its founder, Yves Faroudja.
Except for historical information contained herein, this press release contains forward-looking statements that are subject to risks and uncertainties, including fluctuations in operating results, the timely development and acceptance of new products, product availability from suppliers, the impact of competitive products and pricing, changing TV standards and other risks set forth under the caption "Factors Affecting Future Operating Results" in Faroudja's Annual Report on Form 10-K for the year ended December 31, 1998, in its quarterly reports on Form 10-Q for the quarters ended March 31, 1999, June 30, 1999, September 30, 1999 and other filings with the SEC.
FAROUDJA, INC.
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
(Amount in thousands, except per share data)
Three Months Ended
December 31,
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1999 1998
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Revenues:
Product sales $ 3,877 $ 2,554
License and royalty revenues -- --
-------- --------
Total revenues 3,877 2,554
Cost of product sales 1,712 1,339
-------- --------
Gross profit 2,165 1,215
Operating expenses:
Research and development 1,018 995
Sales and marketing 670 698
General and administrative 637 679
-------- --------
Total operating expenses 2,325 2,372
-------- --------
Operating loss (160) (1,157)
Other income (expense), net 237 255
-------- --------
Income (loss) before provision for
income taxes 77 (902)
Benefit for income taxes 0 0
-------- --------
Net income (loss) $ 77 ($ 902)
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Net income (loss) per share:
Basic $ 0.01 ($ 0.07)
Diluted $ 0.01 ($ 0.07)
Number of shares used in per
share computation:
Basic 12,311 12,204
Diluted 12,735 12,204
Year Ended
December 31,
--------------------
1999 1998
-------- --------
Revenues:
Product sales $ 13,476 $ 11,520
License and royalty revenues -- 750
-------- --------
Total revenues 13,476 12,270
Cost of product sales 6,310 5,499
-------- --------
Gross profit 7,166 6,771
Operating expenses:
Research and development 4,175 4,822
Sales and marketing 3,359 3,551
General and administrative 2,648 3,458
-------- --------
Total operating expenses 10,182 11,831
-------- --------
Operating loss (3,016) (5,060)
Other income (expense), net 917 1,134
-------- --------
Income (loss) before provision for
income taxes (2,099) (3,926)
Benefit for income taxes 0 457
-------- --------
Net income (loss) ($ 2,099) ($ 3,469)
======== ========
Net income (loss) per share:
Basic ($ 0.17) ($ 0.29)
Diluted ($ 0.17) ($ 0.29)
Number of shares used in per
share computation:
Basic 12,272 12,146
Diluted 12,272 12,146
FAROUDJA, INC.
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
December 31, December 31,
1999 1998
------------ ------------
(unaudited) (note)
ASSETS
Current assets:
Cash and cash equivalents $19,916 $20,419
Accounts receivable 3,418 1,764
Inventories 2,222 3,348
Other current assets 454 1,179
------------ ------------
Total current assets 26,010 26,710
Property and equipment, net 1,104 1,778
Investment 7,266 -
Other assets 187 233
------------ ------------
$34,567 $28,721
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LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $957 $1,125
Deferred revenue 2,425 -
Other current liabilities 2,102 1,098
------------ ------------
Total current liabilities 5,484 2,223
Stockholders' equity:
Common stock 12 12
Additional paid-in capital 30,322 30,027
Accumulated other comprehensive
income 4,341 -
Accumulated deficit (5,592) (3,541)
------------ ------------
Total stockholders' equity 29,083 26,498
------------ ------------
$34,567 $28,721
============ ============
Note - The balance sheet at December 31, 1998 has been derived from
the audited financial statements at that date.
CONTACT: Faroudja, Inc., Sunnyvale Ken Boschwitz, Vice President - Business Development 408/735-1492
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