TAIPEI, Taiwan, July 31, 2017 /PRNewswire/ -- GigaMedia Limited
(NASDAQ: GIGM) today announced its second-quarter 2017 unaudited financial results.
Comments from Management
In the second quarter, the Company went through the transition to a new CEO and the Management has been reviewing the business
strategies.
"In the past years, we could see some big fluctuation in traffic for social games. In order not to make our business seems
like it's on the roller coaster, we now focus on seeking licensed games which have the potentials to be long-term hits instead of
the ones live shortly like a flash in the pan.
GigaMedia will launch a new game this year and we are looking forward to improving performance and delivering positive
operating income from mobile games which have long lifespan." said GigaMedia Limited Chief Executive Officer James Huang.
Second Quarter Overview
- Comparing with the same quarter of 2016, operating revenue increased 51% and the gross profit increased 65.5% this
quarter.
- $1.75 million was received for transferring the license right of ArcheAge to XL
Games Inc. and recorded in the non-operating income.
- Cash flow from operation was with a net inflow of $1 million.
- Total current assets increased $0.5 million and the total assets remain $70 million quarter-on-quarter.
- Short-term debt remained the same amount at approximately $2.6 million comparing with the
first quarter of 2017 and showed a decrease of almost $3 million comparing with the same quarter
of 2016.
- The net asset value was $5.4 per share.
Unaudited Consolidated Financial Results
GigaMedia Limited is a diversified provider of online games. GigaMedia's online games business FunTown develops and operates a
suite of games in Taiwan and Hong Kong, with focus on
browser/mobile games and social casino games.
Unaudited consolidated results of GigaMedia are summarized in the table below.
|
GIGAMEDIA2Q17 UNAUDITED CONSOLIDATED FINANCIAL RESULTS
|
|
(unaudited, all figures in US$ thousands, except per share
amounts)
|
|
2Q17
|
|
1Q17
|
|
Change
(%)
|
|
2Q17
|
|
2Q16
|
|
Change
(%)
|
|
Revenues
|
|
3,117
|
|
4,147
|
|
-24.84%
|
|
3,117
|
|
2,062
|
|
51.16%
|
|
Gross Profit
|
|
1,751
|
|
2,282
|
|
-23.27%
|
|
1,751
|
|
1,058
|
|
65.50%
|
|
Loss from Operations
|
|
734
|
|
429
|
|
NM
|
|
734
|
|
1,283
|
|
NM
|
|
Net Income (Loss) Attributable to GigaMedia
|
|
904
|
|
(760)
|
|
NM
|
|
904
|
|
(2,146)
|
|
NM
|
|
Net Income (Loss) Per Share Attributable to GigaMedia, Diluted
|
|
0.08
|
|
(0.07)
|
|
NM
|
|
0.08
|
|
(0.19)
|
|
NM
|
|
EBITDA (A)
|
|
812
|
|
(821)
|
|
NM
|
|
812
|
|
(2,144)
|
|
NM
|
|
Cash and Marketable Securities-Current
|
|
66,452
|
|
65,354
|
|
1.68%
|
|
66,452
|
|
70,585
|
|
-5.86%
|
|
NM= Not Meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A) EBITDA (earnings before interest, taxes, depreciation, and
amortization) is provided as a supplement to results provided in accordance with U.S. generally accepted accounting
principles ("GAAP"). (See, "Use of Non-GAAP Measures," for more details.)
|
Second-Quarter Financial Results
- Consolidated revenues for the second quarter of 2017 decreased 24.8% quarter-on-quarter from
$4.1 million to $3.1 million and increased 51.2% year-over-year
from $2 million to $3.1 million.
- Consolidated gross profit decreased 23.3% quarter-on-quarter from $2.3
million to $1.8 million and increased 65.5% year-over-year from $1.1 million to $1.8 million.
- Consolidated operating expenses were $2.5 million in the second
quarter of 2017. A decrease of $0.2 million from the first quarter of 2017 which reflected the
decease of selling and marketing expense.
- Consolidated loss from operation of the second quarter of 2017 was $0.7
million, slightly increased from the first quarter of 2017. The increased loss reflected lower proportions of game
business revenues. However, a decrease of $0.5 million was seen in year-over-year comparison, the
loss was down to $0.7 million from $1.3 million.
- Consolidated non-operating income during the second quarter of 2017 was $1.6
million compared to a loss of $0.3 million in the first quarter of 2017 and $0.9 million in the second quarter of 2016. Results in the second quarter of 2017 primarily included gains
from the transaction of ArcheAge.
- Consolidated net income of the second quarter of 2017 was $0.9
million compared to a loss of $0.8 million in the first quarter of 2017 and a loss of
$2.1 million in the second quarter of 2016. The period variations primarily reflected the factors
affecting income from operations and consolidated non-operating income.
- Cash and marketable securities-current in the second quarter of 2017 accounted for $66.5 million which increased 1.68% from the first quarter of 2017.
Financial Position
GigaMedia maintained its solid financial position with cash and cash equivalents, marketable securities-current and restricted
cash accounted for $67 million as of June 30, 2017, or $6 per share.
Business Outlook
The following forward-looking statements reflect GigaMedia's expectations as of July
31 , 201 7 . Given potential changes in economic conditions and consumer spending, the evolving
nature of online games, and various other risk factors, including those discussed in the C ompany's 20
16 Annual Report on Form 20-F fi led with the U.S. Securities and Exchange Commission
as referenced below, actual results may differ materially.
Online Games Business
GigaMedia is repositioning its online games business to align itself with steady growth in licensed games. The Company is
focusing on licensing in long-lifecycle games which allow us to build up communities, network our customers and accumulate games
awareness; hence we will be able to maintain the stability in revenues. Management also targets to launch a new licensed game
this year.
As for social games, the Company continues upgrading game server system and integrating the game development environment to
enhance efficiencies and strengthen operations. One new slot game is targeted to launch in the third quarter.
Investment
The Company continues seeking suitable strategic investment and acquisition targets with sustainable business models worldwide
to increase corporate growth and maximize shareholder value.
Use of Non-GAAP Measures
To supplement GigaMedia's consolidated financial statements presented in accordance with US GAAP, the Company uses the
following measure defined as non-GAAP by the SEC: EBITDA. Management believes that EBITDA (earnings before interest, taxes,
depreciation, and amortization) is a useful supplemental measure of performance because it excludes certain non-cash items such
as depreciation and amortization and that EBITDA is a measure of performance used by some investors, equity analysts and others
to make informed investment decisions. EBITDA is not a recognized earnings measure under GAAP and does not have a standardized
meaning. Non-GAAP measures such as EBITDA should be considered in addition to results prepared in accordance with GAAP, but
should not be considered a substitute for, or superior to, other financial measures prepared in accordance with GAAP. A
limitation of using EBITDA is that it does not include all items that impact the company's net income for the period.
Reconciliations to the GAAP equivalents of the non-GAAP financial measures are provided on the attached unaudited financial
statements.
About the Numbers in This Release
Quarterly results
All quarterly results referred to in the text, tables and attachments to this release are unaudited. The financial statements
from which the financial results reported in this press release are derived have been prepared in accordance with U.S. GAAP,
unless otherwise noted as "non-GAAP," and are presented in U.S. dollars.
Q&A
For Q&A regarding the second quarter 2017 performance upon the release, investors may send the questions via email to
IR@gigamedia.com.tw, and the responses will be replied
individually.
About GigaMedia
Headquartered in Taipei, Taiwan, GigaMedia Limited (Singapore registration number: 199905474H) is a diversified provider of online games. GigaMedia's online
games business develops and operates a suite of games in Taiwan and Hong Kong, with focus on browser/mobile games and social casino games. More information on GigaMedia can be
obtained from www.gigamedia.com.
The statements included above and elsewhere in this press release that are not historical in nature are "forward-looking
statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include statements regarding expected financial performance (as described without limitation in the
"Business Outlook" section and in quotations from management in this press release) and GigaMedia's strategic and operational
plans. These statements are based on management's current expectations and are subject to risks and uncertainties and changes in
circumstances. There are important factors that could cause actual results to differ materially from those anticipated in the
forward looking statements, including but not limited to, our ability to license, develop or acquire additional online games that
are appealing to users, our ability to retain existing online game players and attract new players, and our ability to launch
online games in a timely manner and pursuant to our anticipated schedule. Further information on risks or other factors that
could cause results to differ is detailed in GigaMedia's Annual Report on Form 20-F filed in April
2017 and its other filings with the United States Securities and Exchange Commission.
|
GIGAMEDIA LIMITED
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
Three months ended
|
|
|
6/30/2017
|
|
03/31/2017
|
|
6/30/2016
|
|
|
unaudited
|
|
unaudited
|
|
unaudited
|
|
|
USD
|
|
USD
|
|
USD
|
|
Operating revenues
|
|
|
|
|
|
|
|
Asian online game and service revenues
|
|
3,117,035
|
|
4,147,068
|
|
2,061,392
|
|
Other revenues
|
|
-
|
|
-
|
|
283
|
|
|
3,117,035
|
|
4,147,068
|
|
2,061,675
|
|
Operating costs
|
|
|
|
|
|
|
|
Cost of Asian online game and service revenues
|
|
1,366,009
|
|
1,864,588
|
|
1,003,828
|
|
Cost of other revenues
|
|
-
|
|
-
|
|
296
|
|
|
1,366,009
|
|
1,864,588
|
|
1,004,124
|
|
Gross profit
|
|
1,751,026
|
|
2,282,480
|
|
1,057,551
|
|
Operating expenses
|
|
|
|
|
|
|
|
Product development and engineering expenses
|
|
288,371
|
|
276,697
|
|
167,563
|
|
Selling and marketing expenses
|
|
1,174,915
|
|
1,470,628
|
|
1,426,594
|
|
General and administrative expenses
|
|
1,021,624
|
|
964,524
|
|
746,910
|
|
Other
|
|
-
|
|
-
|
|
-
|
|
|
2,484,910
|
|
2,711,849
|
|
2,341,067
|
|
Loss from operations
|
|
(733,884)
|
|
(429,369)
|
|
(1,283,516)
|
|
Non-operating income (expense)
|
|
|
|
|
|
|
|
Interest income
|
|
108,580
|
|
77,174
|
|
80,925
|
|
Interest expense
|
|
(11,717)
|
|
(11,730)
|
|
(25,981)
|
|
Foreign exchange (loss) gain - net
|
|
(74,523)
|
|
(377,450)
|
|
(94,062)
|
|
(Loss) Gain on disposal of property, plant and equipment
|
|
965
|
|
-
|
|
8,090
|
|
Equity in net loss on equity method investments
|
|
(311)
|
|
(23,265)
|
|
(858,492)
|
|
Gain on disposal of investments
|
|
-
|
|
-
|
|
8,567
|
|
Impairment loss on marketable securities and investments
|
|
(52,242)
|
|
-
|
|
-
|
|
Other - net
|
|
1,667,257
|
|
5,501
|
|
15,237
|
|
|
1,638,009
|
|
(329,770)
|
|
(865,716)
|
|
(Loss) Income from continuing operations before income taxes
|
|
904,125
|
|
(759,139)
|
|
(2,149,232)
|
|
Income tax benefit (expense)
|
|
-
|
|
(456)
|
|
2,961
|
|
(Loss) Income from continuing operations
|
|
904,125
|
|
(759,595)
|
|
(2,146,271)
|
|
Net (loss) income
|
|
904,125
|
|
(759,595)
|
|
(2,149,271)
|
|
Less: Net loss attributable to noncontrolling interest
|
|
|
|
-
|
|
-
|
|
Net (loss) income attributable to shareholders of GigaMedia
|
|
904,125
|
|
(759,595)
|
|
(2,149,271)
|
|
(Loss) Earnings per share attributable to GigaMedia
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
(Loss) Income from continuing operations
|
|
0.08
|
|
(0.07)
|
|
(0.19)
|
|
Loss from discontinued operations
|
|
0.00
|
|
0.00
|
|
0.00
|
|
|
0.08
|
|
(0.07)
|
|
(0.19)
|
|
Diluted:
|
|
|
|
|
|
|
|
(Loss) Income from continuing operations
|
|
0.08
|
|
(0.07)
|
|
(0.19)
|
|
Loss from discontinued operations
|
|
0.00
|
|
0.00
|
|
0.00
|
|
|
0.08
|
|
(0.07)
|
|
(0.19)
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
|
11,052,235
|
|
11,052,235
|
|
11,052,332
|
|
Diluted
|
|
11,052,235
|
|
11,052,235
|
|
11,052,235
|
|
GIGAMEDIA LIMITED
|
|
CONSOLIDATED BALANCE SHEETS
|
|
|
6/30/2017
|
|
3/31/2017
|
|
6/30/2016
|
|
|
unaudited
|
|
audited
|
|
unaudited
|
|
|
USD
|
|
USD
|
|
USD
|
|
Assets
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
66,449,544
|
|
65,351,207
|
|
70,581,209
|
|
Marketable securities - current
|
|
2,617
|
|
2,617
|
|
3,830
|
|
Accounts receivable - net
|
|
724,508
|
|
1,247,420
|
|
820,603
|
|
Prepaid expenses
|
|
510,432
|
|
493,229
|
|
488,851
|
|
Restricted cash
|
|
503,640
|
|
500,000
|
|
1,004,110
|
|
Other receivables
|
|
913,366
|
|
949,225
|
|
30,059
|
|
Other current assets
|
|
146,242
|
|
176,686
|
|
192,924
|
|
Total current assets
|
|
69,250,349
|
|
68,720,384
|
|
73,121,586
|
|
|
|
|
|
|
|
|
Marketable securities - noncurrent
|
|
|
|
|
|
|
|
Investments
|
|
-
|
|
52,790
|
|
3,720,766
|
|
Property, plant & equipment - net
|
|
29,445
|
|
22,434
|
|
400,831
|
|
Intangible assets - net
|
|
4,848
|
|
4,824
|
|
111,064
|
|
Prepaid licensing and royalty fees
|
|
389,886
|
|
904,404
|
|
912,055
|
|
Other assets
|
|
384,468
|
|
367,749
|
|
414,857
|
|
Total assets
|
|
70,058,996
|
|
70,072,585
|
|
78,681,159
|
|
|
|
|
|
|
|
|
Liabilities and equity
|
|
|
|
|
|
|
|
Short-term borrowings
|
|
2,629,849
|
|
2,637,652
|
|
5,577,072
|
|
Accounts payable
|
|
291,215
|
|
434,631
|
|
272,203
|
|
Accrued compensation
|
|
375,393
|
|
225,287
|
|
392,706
|
|
Accrued expenses
|
|
2,628,643
|
|
3,332,207
|
|
2,560,114
|
|
Unearned revenue
|
|
2,111,474
|
|
2,150,001
|
|
1,661,640
|
|
Other current liabilities
|
|
169,352
|
|
404,262
|
|
1,614,011
|
|
Total current liabilities
|
|
8,205,926
|
|
9,184,040
|
|
12,077,746
|
|
Other liabilities
|
|
1,671,511
|
|
1,671,511
|
|
1,712,015
|
|
Total liabilities
|
|
9,877,437
|
|
10,855,551
|
|
13,789,761
|
|
GigaMedia's shareholders' equity
|
|
60,181,559
|
|
59,217,034
|
|
64,891,398
|
|
Noncontrolling interest
|
|
-
|
|
-
|
|
-
|
|
Total equity
|
|
60,181,559
|
|
59,217,034
|
|
64,891,398
|
|
Total liabilities and equity
|
|
70,058,996
|
|
70,072,585
|
|
78,681,159
|
|
GIGAMEDIA LIMITED
|
|
RECONCILIATIONS OF NON-GAAP RESULTS OF OPERATIONS
|
|
|
Three months ended
|
|
|
6/30/2017
|
|
3/31/2017
|
|
6/30/2016
|
|
|
unaudited
|
|
unaudited
|
|
unaudited
|
|
|
USD
|
|
USD
|
|
USD
|
|
Reconciliation of Net Income (Loss) to EBITDA
|
|
|
|
|
|
|
|
Net income (loss) attributable to GigaMedia
|
|
904,125
|
|
(759,595)
|
|
(2,146,271)
|
|
Depreciation
|
|
1,657
|
|
953
|
|
29,306
|
|
Amortization
|
|
3,005
|
|
2,798
|
|
30,947
|
|
Interest income
|
|
(108,580)
|
|
(77,174)
|
|
(80,925)
|
|
Interest expense
|
|
11,717
|
|
11,730
|
|
25,981
|
|
Income tax (benefit) expense
|
|
-
|
|
456
|
|
(2,961)
|
|
EBITDA
|
|
811,924
|
|
(820,832)
|
|
(2,143,923)
|
For further information contact:
Annie Sun
Investor Relations Department
Country/City Code 8862 Tel: 2656-8096
IR@gigamedia.com.tw
View original content:http://www.prnewswire.com/news-releases/gigamedia-announces-second-quarter-2017-financial-results-300496493.html
SOURCE GigaMedia