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Diodes Inc. Reports Operating Results (10-K)

February 28, 2011 | About:
10qk

10qk

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Diodes Inc. (DIOD) filed Annual Report for the period ended 2010-12-31.

Diodes Inc. has a market cap of $1.31 billion; its shares were traded at around $29.55 with a P/E ratio of 16.42 and P/S ratio of 2.14. Hedge Fund Gurus that owns DIOD: Richard Pzena of Pzena Investment Management LLC. Mutual Fund and Other Gurus that owns DIOD: John Buckingham of Al Frank Asset Management, Inc., Chuck Royce of Royce& Associates.
This is the annual revenues and earnings per share of DIOD over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of DIOD.


Highlight of Business Operations:

For the years ended December 31, 2010, 2009 and 2008, Company-sponsored investment in research and development activities was $26.6 million, $23.8 million and $21.9 million, respectively. As a percentage of net sales, research and development expense was 4.3%, 5.5% and 5.1% for 2010, 2009 and 2008, respectively. The increase in 2009 was mainly due to research and development activities associated with the acquisition of Zetex, offset by our cost reduction efforts during 2009, and the increase in 2010 was primarily due to increased personnel costs, engineering supplies and material purchases as a result of increased net sales.

We sold products to LSC totaling 1.1%, 2.1% and 3.5% of our net sales for the years ended December 31, 2010, 2009 and 2008, respectively, making LSC one of our largest customers. Also for the years ended December 31, 2010, 2009 and 2008, 6.9%, 6.3% and 9.6%, respectively, of our net sales were from semiconductor products purchased from LSC for subsequent sale, making LSC our largest supplier. We also rent warehouse space in Hong Kong with a lease term ending March 2011 from a member of the Lite-On Group. During 2010 the warehousing function in Hong Kong was moved to a separate facility managed by a third party and therefore, we do not plan to renew the lease. For the years ended December 31, 2010, 2009 and 2008, we paid this entity $0.2 million, $0.8 million and $0.7 million, respectively.

In addition, we sell products to, and purchase inventory from, companies owned by Keylink. We sold products to companies owned by Keylink, totaling 2.5%, 2.6% and 0.8% of net sales for the years ended December 31, 2010, 2009 and 2008, respectively. Also for the years ended December 31, 2010, 2009 and 2008, 1.9%, 1.2% and 1.3%, respectively, of our net sales were from

In 2010, 2009 and 2008, LSC, our largest stockholder and one of our largest customers, accounted for 1.1%, 2.1% and 3.5%, respectively, of our net sales. LSC is also our largest supplier, providing us with discrete semiconductor products for subsequent sale by us, which represented approximately 6.9%, 6.3% and 9.6%, respectively, of our net sales, in 2010, 2009 and 2008. In addition, in 2010, 2009 and 2008, we sold products to companies owned by Keylink, totaling 2.5%, 2.6% and 0.8%, respectively. Also for 2010, 2009 and 2008, 1.9%, 1.2% and 1.3%, respectively, of our net sales were from semiconductor products purchased from companies owned by Keylink.

Prices for our products tend to decrease over their life cycle. There is substantial and continuing pressure from customers to reduce the total cost of purchasing our products. To remain competitive and retain our customers and gain new ones, we must continue to reduce our costs through product and manufacturing improvements. We must also strive to minimize our customers’ shipping and inventory financing costs and to meet their other goals for rationalization of supply and production. We experienced a increase in average selling prices (“ASP”) for our products of 5.6% in 2008, a decrease of 2.1% in 2009 and an increase of 5.1% in 2010. At times, we may be required to sell our products at ASP’s below our manufacturing cost or purchase price in order to remain competitive. Our growth and the profit margins of our products will suffer if we cannot effectively continue to reduce our costs and keep our product prices competitive.

Read the The complete Report

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