Sigma Designs Inc. Reports Fourth Quarter and Year-End Results
FREMONT, Calif.--(BUSINESS WIRE)--Feb. 26, 1998--Sigma Designs Inc. (NASDAQ:SIGM - news) today announced results for its fourth fiscal quarter and the year ended January 31, 1998.
Sales for the fourth quarter of fiscal 1998 were $9,860,000, up 2% from $9,673,000 reported for the same period in fiscal 1997. The Company reported a net loss of $580,000, or diluted loss per share of $0.05 in the fourth quarter of fiscal 1998, compared to net income of $221,000, or diluted income per share of $0.02 in the fourth quarter of fiscal 1997.
For the year ended January 31, 1998, sales were $36,982,000 compared to $41,214,000 reported for fiscal 1997. The Company reported a net loss of $5,648,000, or diluted loss per share of $0.50 for fiscal 1998 compared to net income of $1,529,000, or diluted income per share of $0.14 in fiscal 1997.
Thinh Tran, Chairman and Chief Executive Officer, stated, ''During the fourth quarter, we saw continued growth in the corporate intranet and enterprise video networking markets, with simultaneous demand from customers for high-quality video applications at the desktop. The continuing migration of digital video from stand-alone desktops to networked applications enriches the workplace and the consumer experience.
''This trend resulted in Sigma's announcing four exciting customer applications during the fourth quarter: the use of REALmagic NetStream-1 to add multimedia playback in automated teller machines (ATMs) provided by Diebold Inc. [NYSE:DBD - news], the leading supplier of ATMs in the United States; the selection of our MPEG-2 decoder card by Hughes Network Systems Inc., the world's leading supplier of digital satellite networks and enterprise networking technologies, for networked video applications targeted at over 150,000 existing business VSAT users; the use of our NetStream MPEG playback cards in interactive kiosks in Wal-Mart stores across the continental United States, giving customers the ability to preview home videos, CDs, and tapes before purchase; and the use of our MPEG video playback technology in travel entertainment systems being installed in airline seats and cruise ship cabins.''
''We continue to partner with PC OEMs providing DVD upgrade kits and DVD-enabled PCs using Sigma's REALmagic Hollywood-2 and Ventura DVD technology. During the quarter, we announced that NewCom, a leading supplier of upgrade peripherals to the retail channel, had selected Sigma's DVD decoder board for use in NewCom's new DVD upgrade kit.
''We secured design wins with two of Taiwan's leading notebook OEMs-ASE Technologies and Kapok Computers. And earlier this week, we announced that Tiger Direct has selected Sigma's REALmagic Ventura DVD MPEG-2 playback card for Tiger's new PC Cinema DVD Player/Internet PC, which is priced under $1,000,'' Tran concluded.
The Company also announced that it has raised $5 million in equity capital through the sale of convertible preferred stock in a private placement to a private equity fund. Proceeds from the financing will be used to ensure ramped-up production facilities for the Company's DVD and NetStream product offerings.
''This financing was done to provide the production capacity required to launch and follow through with our product strategy roadmap in establishing Sigma Designs as a premier player in the DVD/MPEG-2 and networked video markets,'' said Kit Tsui, Sigma's Chief Financial Officer.
Sigma Designs, headquartered in Fremont, is an acknowledged leader in the fast-growing multimedia market. Sigma entered the multimedia field in 1993 with products based on the MPEG (Moving Picture Experts Group) standard for compressing and decompressing digital audio and video signals. Sigma is a driving force in advancement of the MPEG technology used in most multimedia PCs on the market today.
Sigma Designs' products, marketed under the REALmagic trade name, are sold worldwide through a direct sales force and a network of manufacturers' representatives, VARs, and distributors. For more information, visit the Company's web site at sigmadesigns.com.
This press release contains forward-looking statements regarding the networked video market, the PC-DVD market, and the features and potential growth prospects of certain MPEG and DVD products offered by the Company in this market that involve risks and uncertainties. Actual results may vary due to a number of factors including, but not limited to, the ability of the Company's REALmagic Ventura DVD MPEG-2 playback card, the Company's REALmagic Hollywood-2 DVD MPEG-2 playback card, and the Company's NetStream MPEG playback card to compete with other technologies in these emerging markets and the risk that such products will not gain widespread acceptance or be rendered obsolete by product offerings of competitors, or by alternative technologies.
Following are highlights of the fourth quarter and year-end results:
Sigma Designs Inc.
Quarter ended January 31, 1998 1997
Net sales $ 9,860,000 $ 9,673,000
Net income (loss) available to
common shareholders $ (580,000) $ 221,000
Diluted weighted average shares 11,488,000 11,615,000
Diluted earnings per share:
Net income (loss) $ (0.05) $ 0.02
Year ended January 31, 1998 1997
Net sales $ 36,982,000 $ 41,214,000
Net income (loss) available to
common shareholders $ (5,648,000) $ 1,529,000
Diluted weighted average shares 11,215,000 11,259,000
Diluted earnings per share:
Net income (loss) $ (0.50) $ 0.14
Sigma Designs Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share data. Unaudited)
Three months ended Years ended
January 31, January 31,
1998 1997 1998 1997
Net sales $ 9,860 $ 9,673 $ 36,982 $ 41,214
Cost of goods sold 7,055 6,060 28,296 26,531
Gross profit 2,805 3,613 8,686 14,683
Other costs and expenses:
Research and development 1,249 1,235 4,948 4,688
Sales and marketing 966 1,291 4,371 5,541
General and administrative 896 840 5,166 2,986
Total costs 3,111 3,366 14,485 13,215
Operating income (loss) (306) 247 (5,799) 1,468
Interest and other income
(expense), net (139) (26) 723 61
Income (loss) before
dividend on preferred stock (445) 221 (5,076) 1,529
Dividend on preferred stock (135) -- (572) --
Net income (loss) available
to common shareholders $ (580) $ 221 $ (5,648) $ 1,529
Diluted net income (loss)
per share $ (0.05) $ 0.02 $ (0.50) $ 0.14
Diluted shares used in
per share calculation 11,488 11,615 11,215 11,259
Sigma Designs Inc.
Condensed Consolidated Balance Sheets
(In thousands)
January 31,
1998 1997
(Unaudited)
Assets
Current assets:
Cash and marketable securities $ 16,648 $ 18,746
Accounts receivable 12,395 12,477
Inventories 7,314 4,880
Prepaid expenses 592 581
Total current assets 36,949 36,684
Property and equipment, net 1,241 1,098
Other assets 139 133
Total assets $ 38,329 $ 37,915
Liabilities and shareholders' equity
Current liabilities:
Bank line of credit $ 13,316 $ 10,831
Accounts payable 3,014 3,286
Accrued liabilities 1,415 2,101
Accrued facilities 244 302
Total current liabilities 17,989 16,520
Long-term debt 27 378
Shareholders' equity:
Preferred stock 2,715 --
Common stock 56,419 54,311
Accumulated deficit (38,758) (33,114)
Deferred stock compensation -- (100)
Shareholder note receivable (63) (80)
Total shareholders' equity 20,313 21,017
Total liabilities and
shareholders' equity $ 38,329 $ 37,915
Contact:
Sigma Designs, Fremont
Carol B. Kaplan, 510/770-2991 |
