Attached files
| file | filename |
|---|---|
| 8-K - 8-K - UNIVERSAL DISPLAY CORP \PA\ | oled-8k_20171102.htm |
Exhibit 99.1
Press Release
Universal Display Contact:
Darice Liu
investor@oled.com
media@oled.com
609-671-0980 x570
UNIVERSAL DISPLAY CORPORATION ANNOUNCES THIRD QUARTER 2017 FINANCIAL RESULTS
EWING, N.J. – November 2, 2017 – Universal Display Corporation (Nasdaq: OLED), enabling energy-efficient displays and lighting with its UniversalPHOLED® technology and materials, today reported financial results for the third quarter ended September 30, 2017.
“We are pleased to report another outstanding quarter of solid results,” said Sidney D. Rosenblatt, Executive Vice President and Chief Financial Officer of Universal Display. “During the quarter, momentum in the OLED industry continued to grow, from the launch of new flagship OLED smartphones, to increasing demand for OLED TVs, to announced launch plans for the world’s first foldable OLED display product. It is exciting to see the consumer market’s broadening embrace of OLEDs in a myriad of products, including wearables, smartphones, IT, automotive, TVs, as well as the emergence of OLED lighting.”
Rosenblatt continued, “We believe that OLEDs are fast becoming a requirement for the best consumer display products around the world. As a leading enabler in the ecosystem, we believe that our proprietary phosphorescent materials and technologies are key to unlocking the performance, value, and power efficiency of OLEDs.”
Financial Highlights for the Third Quarter of 2017
|
|
• |
Total revenue increased 104% to $61.7 million in the third quarter, compared with $30.2 million in the third quarter of 2016, driven by higher material sales as well as royalty and license fees. |
|
|
• |
Revenue from material sales increased 100% to $47.0 million in the third quarter, compared with $23.5 million in the third quarter of 2016, due to an increase in phosphorescent emitter sales. |
|
|
• |
Revenue from royalty and license fees increased 131% to $12.0 million in the third quarter, compared with $5.2 million in the third quarter of 2016. |
|
|
• |
Operating income increased by $18.8 million to $15.8 million in the third quarter, compared with an operating loss of $3.0 million in the third quarter of 2016. |
|
|
• |
Net income increased by $15.0 million to $13.5 million or $0.28 per diluted share in the third quarter, compared with a net loss of $1.5 million or $0.03 per diluted share in the third quarter of 2016. |
Financial Highlights for the First Nine Months of 2017
|
|
• |
Total revenue increased 77% to $219.8 million in the first nine months, compared with $124.3 million in the first nine months of 2016, driven by higher material sales as well as royalty and license fees. |
|
|
• |
Revenue from material sales increased 100% to $140.5 million in the first nine months, compared with $70.1 million in the first nine months of 2016, due to an increase in phosphorescent emitter sales. |
|
|
• |
Revenue from royalty and license fees increased 38% to $72.7 million in the first nine months, compared with $52.6 million in the first nine months of 2016. |
|
|
• |
Operating income increased by $54.7 million to $88.4 million in the first nine months, compared with $33.7 million in the first nine months of 2016. |
|
|
• |
Net income increased by $48.8 million to $71.1 million or $1.49 per diluted share in the first nine months, compared with $22.3 million or $0.47 per diluted share in the first nine months of 2016. |
2017 Guidance
Although the OLED industry is still at an early state where many variables can have a material impact on its growth, and the Company thus caveats its financial guidance accordingly, the Company believes that its revenues will be in the range of $310 million to $320 million for fiscal 2017.
Dividend
The Company also announced a fourth quarter cash dividend of $0.03 per share on the Company’s common stock. The dividend is payable on December 29, 2017, to all shareholders of record as of the close of business on December 15, 2017.
Conference Call Information
In conjunction with this release, Universal Display will host a conference call on Thursday, November 2, 2017 at 5:00 p.m. Eastern Time. The live webcast of the conference call can be accessed under the events page of the Company's Investor Relations website at ir.oled.com. Those wishing to participate in the live call should dial 1-877-524-8416 (toll-free) or 1-412-902-1028. Please dial in 5-10 minutes prior to the scheduled conference call time. 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 4,500 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 solid-state 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.
Headquartered in Ewing, New Jersey, with international offices in China, Hong Kong, Ireland, Japan, South Korea, and Taiwan, and wholly-owned subsidiary Adesis, Inc. based in New Castle, Delaware, 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, BOE Technology, DuPont Displays, Inc., EverDisplay Optronics (Shanghai) Limited, Innolux Corporation, Japan Display Inc., Kaneka Corporation, Konica Minolta Technology Center, Inc., LG Display Co., Ltd., Lumiotec, Inc., OLEDWorks LLC, OSRAM, Pioneer Corporation, Samsung Display Co., Ltd., Sumitomo Chemical Company, Ltd., Tianma Micro-electronics and Tohoku Pioneer Corporation. To learn more about Universal Display Corporation, please visit http://www.oled.com.
Universal Display Corporation and the Universal Display Corporation 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, the Company’s expected results and future declaration of dividends, as well as the growth of the OLED market and the Company’s opportunities in that market, are forward-looking financial 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, 2016. Universal Display Corporation disclaims any obligation to update any forward-looking statement contained in this document.
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UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
(Unaudited)
|
|
|
September 30, 2017 |
|
|
December 31, 2016 |
|
||
|
ASSETS |
|
|
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
69,153 |
|
|
$ |
139,365 |
|
|
Short-term investments |
|
|
296,282 |
|
|
|
188,644 |
|
|
Accounts receivable |
|
|
43,256 |
|
|
|
24,994 |
|
|
Inventory |
|
|
32,733 |
|
|
|
17,314 |
|
|
Deferred income taxes |
|
|
— |
|
|
|
8,661 |
|
|
Other current assets |
|
|
9,227 |
|
|
|
6,392 |
|
|
Total current assets |
|
|
450,651 |
|
|
|
385,370 |
|
|
PROPERTY AND EQUIPMENT, net of accumulated depreciation of $35,087 and $32,167 |
|
|
49,358 |
|
|
|
27,203 |
|
|
ACQUIRED TECHNOLOGY, net of accumulated amortization of $86,162 and $70,714 |
|
|
136,679 |
|
|
|
152,127 |
|
|
OTHER INTANGIBLE ASSETS, net of accumulated amortization of $1,652 and $615 |
|
|
15,188 |
|
|
|
16,225 |
|
|
GOODWILL |
|
|
15,535 |
|
|
|
15,535 |
|
|
INVESTMENTS |
|
|
14,794 |
|
|
|
14,960 |
|
|
DEFERRED INCOME TAXES |
|
|
44,618 |
|
|
|
15,832 |
|
|
OTHER ASSETS |
|
|
347 |
|
|
|
307 |
|
|
TOTAL ASSETS |
|
$ |
727,170 |
|
|
$ |
627,559 |
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
13,780 |
|
|
$ |
8,112 |
|
|
Accrued expenses |
|
|
20,694 |
|
|
|
19,845 |
|
|
Deferred revenue |
|
|
10,603 |
|
|
|
10,282 |
|
|
Other current liabilities |
|
|
1,199 |
|
|
|
1,967 |
|
|
Total current liabilities |
|
|
46,276 |
|
|
|
40,206 |
|
|
DEFERRED REVENUE |
|
|
25,658 |
|
|
|
31,322 |
|
|
RETIREMENT PLAN BENEFIT LIABILITY |
|
|
32,226 |
|
|
|
27,563 |
|
|
Total liabilities |
|
|
104,160 |
|
|
|
99,091 |
|
|
|
|
|
|
|
|
|
|
|
|
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, 48,466,087 and 48,270,990 shares issued, and 47,108,224 and 46,913,127 shares outstanding, at September 30, 2017 and December 31, 2016, respectively |
|
|
485 |
|
|
|
483 |
|
|
Additional paid-in capital |
|
|
606,415 |
|
|
|
604,364 |
|
|
Retained earnings (accumulated deficit) |
|
|
67,725 |
|
|
|
(25,557 |
) |
|
Accumulated other comprehensive loss |
|
|
(11,459 |
) |
|
|
(10,666 |
) |
|
Treasury stock, at cost (1,357,863 shares at September 30, 2017 and December 31, 2016) |
|
|
(40,158 |
) |
|
|
(40,158 |
) |
|
Total shareholders’ equity |
|
|
623,010 |
|
|
|
528,468 |
|
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
$ |
727,170 |
|
|
$ |
627,559 |
|
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per share data)
(Unaudited)
|
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
||||
|
REVENUE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Material sales |
|
$ |
47,041 |
|
|
$ |
23,465 |
|
|
$ |
140,506 |
|
|
$ |
70,084 |
|
|
Royalty and license fees |
|
|
12,013 |
|
|
|
5,209 |
|
|
|
72,705 |
|
|
|
52,569 |
|
|
Contract research services |
|
|
2,629 |
|
|
|
1,540 |
|
|
|
6,551 |
|
|
|
1,656 |
|
|
Total revenue |
|
|
61,683 |
|
|
|
30,214 |
|
|
|
219,762 |
|
|
|
124,309 |
|
|
COST OF SALES |
|
|
13,465 |
|
|
|
6,458 |
|
|
|
37,762 |
|
|
|
17,194 |
|
|
Gross margin |
|
|
48,218 |
|
|
|
23,756 |
|
|
|
182,000 |
|
|
|
107,115 |
|
|
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
11,596 |
|
|
|
10,118 |
|
|
|
34,099 |
|
|
|
31,562 |
|
|
Selling, general and administrative |
|
|
11,695 |
|
|
|
8,465 |
|
|
|
31,611 |
|
|
|
22,728 |
|
|
Amortization of acquired technology and other intangible assets |
|
|
5,498 |
|
|
|
5,461 |
|
|
|
16,485 |
|
|
|
11,039 |
|
|
Patent costs |
|
|
1,875 |
|
|
|
1,900 |
|
|
|
5,096 |
|
|
|
4,476 |
|
|
Royalty and license expense |
|
|
1,764 |
|
|
|
815 |
|
|
|
6,342 |
|
|
|
3,656 |
|
|
Total operating expenses |
|
|
32,428 |
|
|
|
26,759 |
|
|
|
93,633 |
|
|
|
73,461 |
|
|
OPERATING INCOME (LOSS) |
|
|
15,790 |
|
|
|
(3,003 |
) |
|
|
88,367 |
|
|
|
33,654 |
|
|
Interest income, net |
|
|
861 |
|
|
|
568 |
|
|
|
2,328 |
|
|
|
1,544 |
|
|
Other income (expense), net |
|
|
6 |
|
|
|
(68 |
) |
|
|
(7 |
) |
|
|
(1,982 |
) |
|
Interest and other income, net |
|
|
867 |
|
|
|
500 |
|
|
|
2,321 |
|
|
|
(438 |
) |
|
INCOME (LOSS) BEFORE INCOME TAXES |
|
|
16,657 |
|
|
|
(2,503 |
) |
|
|
90,688 |
|
|
|
33,216 |
|
|
INCOME TAX BENEFIT (EXPENSE) |
|
|
(3,137 |
) |
|
|
1,003 |
|
|
|
(19,616 |
) |
|
|
(10,965 |
) |
|
NET INCOME (LOSS) |
|
$ |
13,520 |
|
|
$ |
(1,500 |
) |
|
$ |
71,072 |
|
|
$ |
22,251 |
|
|
NET INCOME (LOSS) PER COMMON SHARE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC |
|
$ |
0.28 |
|
|
$ |
(0.03 |
) |
|
$ |
1.50 |
|
|
$ |
0.47 |
|
|
DILUTED |
|
$ |
0.28 |
|
|
$ |
(0.03 |
) |
|
$ |
1.49 |
|
|
$ |
0.47 |
|
|
WEIGHTED AVERAGE SHARES USED IN COMPUTING NET INCOME (LOSS) PER COMMON SHARE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC |
|
|
46,801,051 |
|
|
|
46,947,621 |
|
|
|
46,716,726 |
|
|
|
46,889,913 |
|
|
DILUTED |
|
|
46,871,720 |
|
|
|
46,947,621 |
|
|
|
46,793,429 |
|
|
|
47,015,262 |
|
|
CASH DIVIDENDS DECLARED PER COMMON SHARE |
|
$ |
0.03 |
|
|
$ |
— |
|
|
$ |
0.09 |
|
|
$ |
— |
|
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
|
|
|
Nine Months Ended September 30, |
|
|||||
|
|
|
2017 |
|
|
2016 |
|
||
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
71,072 |
|
|
$ |
22,251 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
|
Amortization of deferred revenue |
|
|
(7,206 |
) |
|
|
(5,281 |
) |
|
Depreciation |
|
|
3,638 |
|
|
|
3,002 |
|
|
Amortization of intangibles |
|
|
16,485 |
|
|
|
11,039 |
|
|
Amortization of premium and discount on investments, net |
|
|
(2,055 |
) |
|
|
(1,316 |
) |
|
Stock-based compensation to employees |
|
|
8,467 |
|
|
|
8,231 |
|
|
Stock-based compensation to Board of Directors and Scientific Advisory Board |
|
|
1,890 |
|
|
|
1,273 |
|
|
Change in earnout liability recorded for Adesis acquisition |
|
|
509 |
|
|
|
— |
|
|
Deferred income tax expense |
|
|
6,804 |
|
|
|
4,726 |
|
|
Retirement plan expense |
|
|
3,214 |
|
|
|
3,004 |
|
|
Decrease (increase) in assets: |
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(18,262 |
) |
|
|
3,723 |
|
|
Inventory |
|
|
(15,419 |
) |
|
|
(3,249 |
) |
|
Other current assets |
|
|
(2,835 |
) |
|
|
(4,977 |
) |
|
Other assets |
|
|
(40 |
) |
|
|
(249 |
) |
|
Increase (decrease) in liabilities: |
|
|
|
|
|
|
|
|
|
Accounts payable and accrued expenses |
|
|
3,904 |
|
|
|
(5,134 |
) |
|
Other current liabilities |
|
|
(768 |
) |
|
|
(5 |
) |
|
Deferred revenue |
|
|
1,863 |
|
|
|
3,296 |
|
|
Net cash provided by operating activities |
|
|
71,261 |
|
|
|
40,334 |
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
Purchases of property and equipment |
|
|
(23,221 |
) |
|
|
(4,361 |
) |
|
Purchases of intangibles |
|
|
— |
|
|
|
(95,989 |
) |
|
Purchase of business, net of cash acquired |
|
|
— |
|
|
|
(33,163 |
) |
|
Purchases of investments |
|
|
(456,264 |
) |
|
|
(380,260 |
) |
|
Proceeds from sale of investments |
|
|
351,024 |
|
|
|
434,683 |
|
|
Net cash used in investing activities |
|
|
(128,461 |
) |
|
|
(79,090 |
) |
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock |
|
|
529 |
|
|
|
317 |
|
|
Proceeds from the exercise of common stock options |
|
|
29 |
|
|
|
182 |
|
|
Payment of withholding taxes related to stock-based compensation to employees |
|
|
(9,330 |
) |
|
|
(4,840 |
) |
|
Cash dividends paid |
|
|
(4,240 |
) |
|
|
— |
|
|
Net cash used in financing activities |
|
|
(13,012 |
) |
|
|
(4,341 |
) |
|
DECREASE IN CASH AND CASH EQUIVALENTS |
|
|
(70,212 |
) |
|
|
(43,097 |
) |
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD |
|
|
139,365 |
|
|
|
97,513 |
|
|
CASH AND CASH EQUIVALENTS, END OF PERIOD |
|
$ |
69,153 |
|
|
$ |
54,416 |
|
|
The following non-cash activities occurred: |
|
|
|
|
|
|
|
|
|
Unrealized (gain) loss on available-for-sale securities |
|
$ |
(117) |
|
|
$ |
256 |
|
|
Common stock issued to Board of Directors and Scientific Advisory Board that was earned and accrued for in a previous period |
|
|
300 |
|
|
|
300 |
|
|
Common stock issued to employees that was earned and accrued for in a previous period |
|
|
174 |
|
|
|
1,105 |
|
|
Net change in accounts payable and accrued expenses related to purchases of property and equipment |
|
|
2,572 |
|
|
|
133 |
|
|
Earnout liability recorded for Adesis acquisition |
|
|
— |
|
|
|
1,510 |
|