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OmniVision Technologies, Inc. Reports Operating Results (10-Q)

September 07, 2012 | About:
10qk

10qk

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OmniVision Technologies, Inc. (OVTI) filed Quarterly Report for the period ended 2012-07-31.

Omnivision Technologies, Inc. has a market cap of $857.8 million; its shares were traded at around $16.83 with a P/E ratio of 45.1 and P/S ratio of 1.

Highlight of Business Operations:

decrease in gross margin. In addition, the CameraCubeChip production operations was reflected in our cost of revenues for the three months ended July 31, 2012. Lastly, we experienced a decrease in the sales of previously written-down products in the three months ended July 31, 2012, which totaled $1.4 million, as compared to $5.1 million during the same period in the prior fiscal year. We also recorded an increase in the write-down of inventories which totaled approximately $4.9 million during the three months ended July 31, 2012, as compared to $3.6 million in the similar prior year period. We recorded approximately $1.1 million in stock-based compensation expense to cost of revenues during the three months ended July 31, 2012, as compared to $464,000 in the similar prior year period. We currently expect that our shipment mix in the second quarter of fiscal 2013 will continue to shift towards OmniBSI-2 devices, and as a consequence, gross margin for the second quarter of fiscal 2013 will also remain at lower levels than we have experienced historically in similar periods.

Our working capital increased to $536.3 million as of July 31, 2012, as compared to $533.2 million as of April 30, 2012. Our working capital increased as a result of: a $111.9 million increase in inventories to support the anticipated increase in revenues in the three months ending October 31, 2012; a $34.9 million increase in accounts receivable, net, resulting from a revenue increase of $39.5 million for the three months ended July 31, 2012 from the three months ended April 30, 2012; a $14.0 million increase in prepaid expenses and other current assets when we recorded a dividends receivable from VisEra; a $1.0 million decrease in income tax payable; and a $0.8 million decrease in the current portion of long-term debt. These increases in working capital were partially offset by: a $94.4 million decrease in cash, cash equivalents and short-term investments primarily due to cash used in operating activities; a $62.3 million increase in accounts payable resulting from the purchase of inventories; a $2.0 million decrease in prepaid and deferred income taxes; and a $0.8 million increase in accrued expenses and other current liabilities.

For the three months ended July 31, 2012, net cash used in operating activities totaled approximately $77.1 million as compared to net cash provided by operating activities of approximately $29.3 million for the corresponding period in the prior year. The principal components of the current year amount were: net income of approximately $2.3 million for the three months ended July 31, 2012; adjustments for non-cash charges of $9.5 million in stock-based compensation, $8.5 million in depreciation and amortization, $4.9 million in write-down of inventories, and $3.3 million in gain on equity investments, net; a $62.9 million increase in accounts payable; and a $2.1 million decrease in prepaid and deferred income taxes. These increases were offset by: a $118.9 million increase in inventories; a $34.9 million increase in accounts receivable, net; a $4.8 million decrease in income taxes payable; a $3.3 million increase in prepaid expenses and other assets; and a $2.3 million decrease in accrued expenses and other current liabilities. The $118.9 million increase in inventories was primarily driven by the need to support the anticipated increase in revenues in the three months ending October 31, 2012. The $62.9 million increase in accounts payable was related to the inventory buildup. The $34.9 million increase in accounts receivable, net was caused by the increased amount of revenues recorded during the three months ended July 31, 2012 as compared to the three months ended April 30, 2012.

For the three months ended July 31, 2011, net cash provided by operating activities totaled approximately $29.3 million as compared to $6.4 million for the corresponding period in the prior year. The principal components of the current year amount were: net income of approximately $42.0 million for the three months ended July 31, 2011; adjustments for non-cash charges of $7.4 million in depreciation and amortization, $5.3 million in stock-based compensation, $4.0 million in gains on equity investments, net, $3.6 million in write-down of inventories, $2.8 million in the tax effect from stock-based compensation, $2.5 million in the excess tax benefit from stock-based compensation, and $0.6 million in losses on interest rate swaps; a $16.3 million increase in accounts payable; a $2.7 million decrease in prepaid expenses and other current assets; and a $2.0 million decrease in accounts receivable, net. These increases were partially offset by: a $40.2 million increase in inventories; a $1.9 million decrease in accrued expenses and other current liabilities; a $1.8 million increase in prepaid and deferred income taxes; a $1.6 million decrease in deferred revenues, less cost of revenues; and a $1.5 million decrease in income taxes payable. The $2.0 million decrease in accounts receivable, net, reflects the decrease in days of sales outstanding to 47 days as of July 31, 2011 from 49 days as of April 30, 2011. The $1.6 million decrease in deferred revenues, less cost of revenues, was due to a decrease in inventories at our distributors as of July 31, 2011.

For the three months ended July 31, 2012, our net cash used in investing activities totaled $25.8 million, as compared to net cash provided by investing activities of approximately $11.4 million for the corresponding period in the prior year, due to $122.3 million in purchases of short-term investments, $11.4 million in purchases of property, plant and equipment, net of sales, and $10.0 million in purchases and deposits for intangible and other asset, partially offset by $117.9 million in net proceeds from sales or maturities of short-term investments. For the three months ended July 31, 2011, our cash provided by investing activities totaled $11.4 million, due to $29.9 million in net proceeds from sales or maturities of short-term investments, partially offset by $11.7 million in purchases of short-term investments, $5.4 million in purchases of property, plant and equipment, net of sales, and $1.0 million in purchases of intangible and other asset.

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