EWING, N.J.--(BUSINESS WIRE)--Universal
Display Corporation (NASDAQ: OLED), enabling energy-efficient
displays and lighting with its UniversalPHOLED® technology
and materials, today announced its results for the second quarter of
2013.
“We are pleased to report strong second quarter growth, leading to
record quarterly revenues and earnings”
For the second quarter of 2013, the Company reported net income of $15.4
million, or $0.33 per diluted share, increases of 40% and 43%,
respectively, from second quarter 2012 net income of $11.0 million, or
$0.23 per diluted share. Revenues in the second quarter of 2013 were
$49.4 million, up 65% from revenues of $30.0 million in the second
quarter of 2012.
“We are pleased to report strong second quarter growth, leading to
record quarterly revenues and earnings,” said Sidney D. Rosenblatt,
Executive Vice President and Chief Financial Officer of Universal
Display. “Given the rate at which the market is adopting our energy
efficient, high-performance UniversalPHOLED materials and technology, we
believe the market has achieved a level of sustainable commercial
technology adoption that can drive strong top line growth. With our
proprietary materials and technology generating attractive margins, and
a continued focus on lean and efficient operations, we are leveraging
the success we are achieving with our products in the market into strong
earnings growth for our shareholders.”
Second Quarter Results
Growth in second quarter revenues was led by a 111% increase in material
sales, which rose to $27.1 million, up from $12.8 million in the second
quarter of 2012, reflecting strong volume growth. Royalty and license
fees were $21.2 million in the second quarter of 2013, up 37% compared
to $15.4 million in the same quarter of 2012. The Company recognizes
revenue under its licensing agreement with Samsung Display Corporation
(SDC) only in the quarters in which SDC makes payment, which are the
second and fourth quarters. In the second quarter of 2013, the Company
recognized $20.0 million under this agreement compared to $15.0 million
in the second quarter of 2012. Operating expenses for the second quarter
of 2013 were $27.6 million compared to $17.1 million in the same quarter
of 2012. Within operating expenses for the quarter, cost of materials
accounted for $6.7 million of the increase, reflecting an increase in
the quantity of material shipped and changes in product mix. The
increase in operating expenses also reflects a substantial increase in
patent and amortization of acquired technology expenses, primarily due
to higher amortization associated with the FUJIFILM Corporation OLED
patent portfolio acquired during the third quarter of 2012.
The Company reported operating income of $21.7 million for the second
quarter of 2013, an improvement of $8.8 million, or 68%, compared to
operating income of $12.9 million for the second quarter of 2012.
Operating cash flow for the second quarter of 2013 was a record $26.4
million, an increase of 136% compared to $11.2 million for the second
quarter of 2012.
The Company’s balance sheet remained strong, with cash and cash
equivalents and short-term investments of $244.7 million as of June 30,
2013.
First Six Months Results
Revenues for the first six months of 2013 were $64.3 million, a 51%
increase compared to $42.6 million in the first half of 2012. Material
sales in the first half of the year were $39.9 million, an increase of
71% compared to material sales of $23.4 million in the first half of
2012. Operating income in the first half of 2013 was $14.6 million, or
23% of revenues. For the first half of 2013, we reported net income of
$10.6 million, or $0.23 per diluted share, increases of 9% and 10%,
respectively, compared to net income of $9.7 million, or $0.21 per
diluted share, in the same period of 2012.
Mr. Rosenblatt concluded, “The OLED market continues to demonstrate
significant growth again this year, primarily due to the widely
recognized growth in smartphone adoption. Over the next few years, we
expect to see increased demand for our UniversalPHOLED materials and
technologies as we develop new products, attract new customers, and
create new materials. Beyond the foreseeable opportunities in
smartphones and televisions, we believe the energy efficiency and
superior performance of OLEDs can open vast new markets, and we continue
to invest in our organization and technology to encourage wider market
adoption. In addition to the growth opportunity represented by a rapidly
expanding industry, we are expanding our portfolio of products and
technologies to capture greater market share, and further accelerate
growth. This year we’ve introduced new commercial materials – including
green emitter and host materials – while continuing to advance our
flexible, thin-film barrier and new material deposition technologies. As
the clear industry leader, we are achieving both exciting near term
growth and earnings, while simultaneously laying the foundation to
become a more integral part of the large and growing display and
lighting markets in the future.”
GUIDANCE
Although the OLED industry is still at a stage where many variables can
have a material effect on our growth, the Company now has better
visibility into its potential future financial performance and expects
2013 revenues to reach the high end of its $110M-$125M guidance range.
In conjunction with this release, Universal Display will host a
conference call, followed by a question and answer session, on Thursday,
August 8, 2013 at 5:00 p.m. Eastern Time. Interested parties may
participate by calling 888-747-4655 at 5:00 p.m. Eastern Time and
referencing conference ID 3359758. The conference call will be
simultaneously broadcast live over the Internet through a webcast on the
Universal Display website. To access the call, please visit the events
portion of the website at www.udcoled.com.
An online archive of the webcast will be available within two hours of
the conclusion of the call.
About Universal Display Corporation
Universal Display Corporation (NASDAQ: OLED) is a leader in developing
and delivering state-of-the-art, organic light emitting diode (OLED)
technologies, materials and services to the display and lighting
industries. Founded in 1994, the company currently owns or has
exclusive, co-exclusive or sole license rights with respect to more than
3,000 issued and pending patents worldwide. Universal Display licenses
its proprietary technologies, including its breakthrough high-efficiency
UniversalPHOLED® phosphorescent OLED technology, that can
enable the development of low power and eco-friendly displays and white
lighting. The company also develops and offers high-quality,
state-of-the-art UniversalPHOLED materials that are recognized as key
ingredients in the fabrication of OLEDs with peak performance. In
addition, Universal Display delivers innovative and customized solutions
to its clients and partners through technology transfer, collaborative
technology development and on-site training.
Based in Ewing, New Jersey, with international offices in Ireland, South
Korea, Hong Kong, Japan and Taiwan, Universal Display works and partners
with a network of world-class organizations, including Princeton
University, the University of Southern California, the University of
Michigan, and PPG Industries, Inc. The company has also established
relationships with companies such as AU Optronics Corporation, DuPont
Displays, Inc., Innolux Corporation, Konica Minolta Technology Center,
Inc., LG Display Co., Ltd., Lumiotec, Inc., Moser Baer Technologies
Inc., Panasonic Idemitsu OLED Lighting Co., Pioneer Corporation, Samsung
Display Corporation, Seiko Epson Corporation, Sony Corporation, Showa
Denko K.K., and Tohoku Pioneer Corporation. To learn more about
Universal Display, please visit www.udcoled.com.
Universal Display Corporation and the Universal Display logo are
trademarks or registered trademarks of Universal Display Corporation.
All other company, brand or product names may be trademarks or
registered trademarks.
All statements in this document that are not historical, such as
those relating to Universal Display Corporation’s technologies and
potential applications of those technologies, are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. You are cautioned not to place undue reliance on any
forward-looking statements in this document, as they reflect Universal
Display Corporation’s current views with respect to future events and
are subject to risks and uncertainties that could cause actual results
to differ materially from those contemplated. These risks and
uncertainties are discussed in greater detail in Universal Display
Corporation’s periodic reports on Form 10-K and Form 10-Q filed with the
Securities and Exchange Commission, including, in particular, the
section entitled “Risk Factors” in Universal Display Corporation’s
annual report on Form 10-K for the year ended December 31, 2012.
Universal Display Corporation disclaims any obligation to update any
forward-looking statement contained in this document.
|
|
|
|
|
|
|
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED BALANCE SHEETS
|
|
(unaudited)
|
|
|
|
(in thousands, except for share and per share data)
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
December 31,
|
|
|
|
2013
|
|
2012
|
|
ASSETS
|
|
CURRENT ASSETS:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
80,702
|
|
|
$
|
85,923
|
|
|
Short-term investments
|
|
163,983
|
|
|
158,018
|
|
|
Accounts receivable
|
|
14,451
|
|
|
8,657
|
|
|
Inventory
|
|
8,673
|
|
|
11,018
|
|
|
Other current assets
|
|
6,242
|
|
|
3,929
|
|
|
Total current assets
|
|
274,051
|
|
|
267,545
|
|
|
PROPERTY AND EQUIPMENT, net
|
|
13,904
|
|
|
11,808
|
|
|
ACQUIRED TECHNOLOGY, net
|
|
99,494
|
|
|
104,624
|
|
|
INVESTMENTS
|
|
5,781
|
|
|
1,270
|
|
|
OTHER ASSETS
|
|
275
|
|
|
277
|
|
|
TOTAL ASSETS
|
|
$
|
393,505
|
|
|
$
|
385,524
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
Accounts payable
|
|
$
|
10,555
|
|
|
$
|
7,596
|
|
|
Accrued expenses
|
|
7,406
|
|
|
10,394
|
|
|
Deferred revenue
|
|
4,189
|
|
|
4,273
|
|
|
Other current liabilities
|
|
940
|
|
|
36
|
|
|
Total current liabilities
|
|
23,090
|
|
|
22,299
|
|
|
DEFERRED REVENUE
|
|
2,778
|
|
|
3,153
|
|
|
RETIREMENT PLAN BENEFIT LIABILITY
|
|
10,332
|
|
|
9,837
|
|
|
Total liabilities
|
|
36,200
|
|
|
35,289
|
|
|
SHAREHOLDERS’ EQUITY:
|
|
|
|
|
|
Preferred Stock, par value $0.01 per share, 5,000,000 shares
authorized, 200,000 shares of Series A Nonconvertible Preferred
Stock issued and outstanding (liquidation value of $7.50 per share
or $1,500)
|
|
2
|
|
|
2
|
|
|
Common Stock, par value $0.01 per share, 100,000,000 shares
authorized, 46,608,503 and 46,561,437 shares issued at June 30, 2013
and December 31, 2012, respectively
|
|
466
|
|
|
465
|
|
|
Additional paid-in capital
|
|
566,409
|
|
|
564,883
|
|
|
Accumulated deficit
|
|
(193,587
|
)
|
|
(204,211
|
)
|
|
Accumulated other comprehensive loss
|
|
(5,327
|
)
|
|
(5,702
|
)
|
|
Treasury stock, at cost (401,501 and 205,902 shares at June 30, 2013
and December 31, 2012, respectively)
|
|
(10,658
|
)
|
|
(5,202
|
)
|
|
Total shareholders’ equity
|
|
357,305
|
|
|
350,235
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
$
|
393,505
|
|
|
$
|
385,524
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF INCOME
|
|
(unaudited)
|
|
|
|
(in thousands, except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
REVENUE:
|
|
|
|
|
|
|
|
|
|
|
|
Material sales
|
|
$
|
27,137
|
|
|
$
|
12,848
|
|
|
$
|
39,889
|
|
|
$
|
23,377
|
|
|
Royalty and license fees
|
|
|
21,201
|
|
|
15,435
|
|
|
|
22,500
|
|
|
15,857
|
|
|
Technology development and support revenue
|
|
|
1,021
|
|
|
1,704
|
|
|
|
1,946
|
|
|
3,373
|
|
|
Total revenue
|
|
|
49,359
|
|
|
29,987
|
|
|
|
64,335
|
|
|
42,607
|
|
|
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
Cost of material sales
|
|
|
8,282
|
|
|
1,611
|
|
|
|
11,374
|
|
|
2,699
|
|
|
Research and development
|
|
|
7,316
|
|
|
7,236
|
|
|
|
16,254
|
|
|
13,897
|
|
|
Selling, general and administrative
|
|
|
6,336
|
|
|
5,189
|
|
|
|
11,507
|
|
|
9,486
|
|
|
Patent costs and amortization of acquired technology
|
|
|
4,522
|
|
|
2,255
|
|
|
|
9,139
|
|
|
4,123
|
|
|
Royalty and license expense
|
|
|
1,172
|
|
|
786
|
|
|
|
1,484
|
|
|
1,036
|
|
|
Total operating expenses
|
|
|
27,628
|
|
|
17,077
|
|
|
|
49,758
|
|
|
31,241
|
|
|
Operating income
|
|
|
21,731
|
|
|
12,910
|
|
|
|
14,577
|
|
|
11,366
|
|
|
INTEREST INCOME
|
|
|
178
|
|
|
357
|
|
|
|
388
|
|
|
714
|
|
|
INTEREST EXPENSE
|
|
|
(10
|
)
|
|
(18
|
)
|
|
|
(18
|
)
|
|
(38
|
)
|
|
INCOME BEFORE INCOME TAX EXPENSE
|
|
|
21,899
|
|
|
13,249
|
|
|
|
14,947
|
|
|
12,042
|
|
|
INCOME TAX EXPENSE
|
|
|
(6,517
|
)
|
|
(2,285
|
)
|
|
|
(4,323
|
)
|
|
(2,299
|
)
|
|
NET INCOME
|
|
|
15,382
|
|
|
10,964
|
|
|
|
10,624
|
|
|
9,743
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME PER COMMON SHARE:
|
|
|
|
|
|
|
|
|
|
|
|
BASIC
|
|
$
|
0.34
|
|
|
$
|
0.24
|
|
|
$
|
0.23
|
|
|
$
|
0.21
|
|
|
DILUTED
|
|
$
|
0.33
|
|
|
$
|
0.23
|
|
|
$
|
0.23
|
|
|
$
|
0.21
|
|
|
WEIGHTED AVERAGE SHARES USED IN COMPUTING NET INCOME PER COMMON
SHARE:
|
|
|
|
|
|
|
|
|
|
|
|
BASIC
|
|
|
45,859,286
|
|
|
45,953,312
|
|
|
|
45,841,446
|
|
|
45,871,166
|
|
|
DILUTED
|
|
|
46,496,120
|
|
|
46,857,309
|
|
|
|
46,523,540
|
|
|
46,896,898
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(unaudited)
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
2013
|
|
2012
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
Net income
|
|
$
|
10,624
|
|
|
$
|
9,743
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
Amortization of deferred revenue
|
|
(1,835
|
)
|
|
(1,837
|
)
|
|
Depreciation
|
|
985
|
|
|
927
|
|
|
Amortization of intangibles
|
|
5,483
|
|
|
29
|
|
|
Amortization of premium and discount on investments, net
|
|
(219
|
)
|
|
(437
|
)
|
|
Stock-based employee compensation
|
|
2,935
|
|
|
1,951
|
|
|
Stock-based compensation to Board of Directors and Scientific
Advisory Board
|
|
394
|
|
|
437
|
|
|
Retirement plan benefit expense
|
|
834
|
|
|
777
|
|
|
(Increase) decrease in assets:
|
|
|
|
|
|
Accounts receivable
|
|
(5,794
|
)
|
|
1,147
|
|
|
Inventory
|
|
2,345
|
|
|
(4,728
|
)
|
|
Other current assets
|
|
(2,313
|
)
|
|
(2,257
|
)
|
|
Other assets
|
|
2
|
|
|
10
|
|
|
(Decrease) increase in liabilities:
|
|
|
|
|
|
Accounts payable and accrued expenses
|
|
(186
|
)
|
|
1,899
|
|
|
Other current liabilities
|
|
904
|
|
|
205
|
|
|
Deferred revenue
|
|
1,376
|
|
|
1,335
|
|
|
Net cash provided by operating activities
|
|
15,535
|
|
|
9,201
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
Purchase of property and equipment
|
|
(2,435
|
)
|
|
(2,054
|
)
|
|
Additions to intangibles
|
|
(107
|
)
|
|
(18
|
)
|
|
Purchase of investments
|
|
(185,314
|
)
|
|
(177,449
|
)
|
|
Proceeds from sale of investments
|
|
175,093
|
|
|
220,552
|
|
|
Net cash (used in) provided by investing activities
|
|
(12,763
|
)
|
|
41,031
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
Proceeds from the issuance of common stock
|
|
177
|
|
|
137
|
|
|
Repurchase of common stock
|
|
(5,456
|
)
|
|
—
|
|
|
Proceeds from the exercise of common stock options
|
|
271
|
|
|
943
|
|
|
Payment of withholding taxes related to stock-based employee
compensation
|
|
(2,985
|
)
|
|
(3,508
|
)
|
|
Net cash used in financing activities
|
|
(7,993
|
)
|
|
(2,428
|
)
|
|
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
|
|
(5,221
|
)
|
|
47,804
|
|
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
|
85,923
|
|
|
111,795
|
|
|
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
|
$
|
80,702
|
|
|
$
|
159,599
|
|
|
|
|
|
|
|
|
|
|
|
Contacts
Investor Relations:
Universal Display
Darice Liu,
609-671-0980 x558
dliu@udcoled.com
or
Media
Contact:
Gregory FCA
Matt McLoughlin, 610-228-2123
matt@gregoryfca.com