Universal Electronics Inc. Reports Fourth Quarter and Year-End 2012 Financial Results
February 21, 2013
SANTA ANA, CA -- Universal Electronics Inc. (UEI), (NASDAQ: UEIC) reported financial results for the three and twelve months ended December 31, 2012.
“Our fourth quarter results reflect our solid performance and were within our expectations,” stated Paul Arling, UEI's Chairman and CEO. “In 2012, we demonstrated the many applications for our technology and gained traction in the growing regions of the world and in new product categories, such as smart devices and game consoles. For example, we recently announced that LG joined other leading smart device companies in selecting UEI technology to power their innovative new products, further establishing our embedded app technology in these exciting new growth markets. Smart devices represent a large and growing market for us as the introduction and adoption of smart TVs, tablets and smartphones continues to increase.
“The 2013 International Consumer Electronics Show in Las Vegas in January was another successful event for UEI as we further established ourselves as the leader in innovative solutions for home entertainment control. We unveiled a variety of products and technologies that provide a more intuitive and automated control interface for consumers. Our ability to anticipate the changing trends in home entertainment enables us to provide the products and technologies that address our customers' and consumers' evolving needs. We believe this strategy will continue to serve us well in the months and years ahead.”
Financial Results for the Three Months Ended December 31: 2012 Compared to 2011
- Net sales were $117.8 million, compared to $117.6 million.
- Business Category revenue was $102.8 million, compared to $103.7 million. The Business Category contributed 87.3% of total net sales, compared to 88.2%.
- Consumer Category revenue was $15.0 million, compared to $13.9 million. The Consumer Category contributed 12.7% of total net sales, compared to 11.8%.
- Adjusted pro forma gross margins were 30.5%, compared to 28.6%.
- Adjusted pro forma operating expenses were $27.1 million, compared to $26.2 million.
- Adjusted pro forma operating income was $8.9 million, compared to $7.4 million.
- Adjusted pro forma net income was $6.3 million, or $0.42 per diluted share, compared to $5.9 million, or $0.40 per diluted share.
- At December 31, 2012, cash and cash equivalents was $44.6 million.
Financial Results for the Twelve Months Ended December 31: 2012 Compared to 2011
- Net sales were $463.1 million, compared to $468.6 million.
- Adjusted pro forma gross margins were 29.1%, compared to 28.0%.
- Adjusted pro forma operating expenses were $102.9 million, compared to $100.2 million.
- Adjusted pro forma operating income was $31.6 million, compared to $31.0 million.
- Adjusted pro forma net income was $23.4 million, or $1.55 per diluted share, compared to $23.6 million, or $1.55 per diluted share.
Bryan Hackworth, UEI's CFO, stated: “For many years, we have been at the forefront of advancements in control technologies and solutions, which are now evolving to include Smart Devices. We are very pleased with our early successes embedding UEI technology inside gaming consoles, smartphones, tablets and smart TVs. Initial customer reaction and feedback has been quite positive. We are confident that we will deliver solid growth in 2013 and that our investment in these areas carries significant additional growth potential. Longer term, we believe the profile of our business is one with approximately 5% to 10% average annual revenue growth and average earnings growth of between 10% and 15%. Because it is difficult to accurately predict the commencement, timing of launch and magnitude of orders for specific new products across future quarters or within the current fiscal year, we have decided that, going forward, we will only provide detailed guidance for the upcoming quarter.”
For the first quarter of 2013, the company expects net sales to range between $106.0 million and $112.0 million, compared to $103.7 million in the first quarter of 2012. Adjusted pro forma earnings per diluted share for the first quarter of 2013 are expected to range from $0.20 to $0.26, compared to adjusted pro forma earnings per diluted share of $0.19 in the first quarter of 2012.
Conference Call Information
UEI’s management team will hold a conference call today, Thursday, February 21, 2013 at 4:30 p.m. ET / 1:30 p.m. PT, to discuss its fourth quarter and year-end 2012 earnings results, review recent activity and answer questions. To access the call in the U.S. please dial 877-655-6895 and for international calls dial 706-758-0299 approximately 10 minutes prior to the start of the conference. The conference ID is 93200814. The conference call will also be broadcast live over the Internet and available for replay for one year atwww.uei.com. In addition, a replay of the call will be available via telephone for two business days, beginning two hours after the call. To listen to the replay, in the U.S., please dial 855-859-2056 and internationally, 404-537-3406. Enter access code 93200814.
Use of Non-GAAP Financial Metrics
Non-GAAP gross margins, Non-GAAP operating expenses, and Non-GAAP net income and earnings per share are supplemental measures of the company's performance that are not required by, and are not presented in accordance with GAAP. The non-GAAP information does not substitute for any performance measure derived in accordance with GAAP. Non-GAAP gross profit is defined as gross profit excluding charges related to the write-up of inventory and depreciation related to acquisitions. Non-GAAP operating expenses are defined as operating expenses excluding acquisition costs, amortization of intangibles, other employee related restructuring costs, as well as costs associated with moving our corporate headquarters from Cypress, CA to Santa Ana, CA. Non-GAAP net income is net income from operations excluding the aforementioned items and the related tax effects as well as the write down of certain deferred tax assets resulting from tax law changes. A reconciliation of non-GAAP financial results to GAAP results is included at the end of this press release.
About Universal Electronics Inc.
Founded in 1986, Universal Electronics Inc. (UEI) is the global leader in wireless control technology for the connected home. UEI designs, develops, and delivers innovative solutions that enable consumers to control entertainment devices, digital media, and home systems. The company’s broad portfolio of patented technologies and database of infrared control software have been adopted by many Fortune 500 companies in the consumer electronics, subscription broadcast, and computing industries. UEI sells and licenses wireless control products through distributors and retailers under the One For All® brand name. For additional information, please visit our website at www.uei.com.
Safe Harbor Statement
This press release contains forward-looking statements that are made pursuant to the Safe-Harbor provisions of the Private Securities Litigation Reform Act of 1995. Words and expressions reflecting something other than historical fact are intended to identify forward-looking statements. These forward-looking statements involve a number of risks and uncertainties, including the benefits anticipated by the Company due to continued innovation of products and technologies, such as solutions to address mode confusion, that eliminate remote control setup, and that transform smart devices (such as smartphones and tablets) and gaming consoles into universal remote controls; the Company’s ability to gain market share through the consolidation of our industry and by adding new customers and retaining current customers; the Company’s app technologies being embedded in smart devices and game consoles as anticipated by management; the demand for smart devices and game consoles to grow as anticipated by management; the continued global general economic conditions; the benefits the Company expects via the growth of new markets in certain geographic areas including Latin America, Asia-Pacific region, and Eastern Europe; and other factors described in the Company's filings with the U.S. Securities and Exchange Commission. The actual results that the Company achieves may differ materially from any forward-looking statement due to such risks and uncertainties. The Company undertakes no obligations to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.
Contacts: Paul Arling (UEI) 714.918.9500
Becky Herrick (IR Agency) 415.433.3777
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