Diodes Inc. Reports Operating Results (10-Q)
Diodes Inc. has a market cap of $880.3 million; its shares were traded at around $20.12 with a P/E ratio of 61 and P/S ratio of 2.1. DIOD is in the portfolios of John Buckingham of Al Frank Asset Management, Inc., Chuck Royce of Royce& Associates, Richard Pzena of Pzena Investment Management LLC, Steven Cohen of SAC Capital Advisors, Jeremy Grantham of GMO LLC.
Highlight of Business Operations: Amortization of debt discount for the three months ended March 31, 2010 was $1.8 million, compared to $2.2 million in the same period last year. The $0.4 million decrease in amortization of debt discount was due primarily to the repurchase and retirement of $94.9 million par value of Notes during the fourth quarter of 2008 and throughout 2009.
Other income for the three months ended March 31, 2010 was $2.6 million, compared to other expense of $0.3 million in the same period last year. Included in other income for the three months ended March 31, 2010 was a $1.7 million gain on sale of non-core intellectual property for which no intangible assets were ever recorded.
Our primary sources of liquidity are cash and cash equivalents, funds from operations and borrowings under our credit facilities. We currently have a U.S. credit agreement for a $10 million revolving credit facility and a $10 million uncommitted facility with no outstanding borrowings and have foreign credit facilities with borrowing capacities of approximately $51 million of which approximately $0.4 million has been borrowed and $3.3 million has been used for import and export guarantees. Our primary liquidity requirements have been to meet our inventory and capital expenditure needs and to fund on-going operations. At December 31, 2009 and March 31, 2010, our working capital was $354.3 million and $359.5 million, respectively. Our working capital increased in the first three months of 2010 primarily due to the increase in cash, accounts receivables and inventories, partially offset by an increase in accounts payable and accrued liabilities. We expect cash generated by our U.S. and international operations, together with existing cash, cash equivalents and available credit facilities, to be sufficient to cover cash needs for working capital and capital expenditures for at least the next 12 months. Cash and cash equivalents, the conversion of other working-capital items and borrowings are expected to be sufficient to fund on-going operations.
Net cash provided by operating activities for the three months ended March 31, 2010 was $23.9 million, resulting primarily from $15.7 million of net income and $12.0 million in depreciation and amortization. Net cash provided by operating activities was $6.8 million for the same period last year. Net cash provided by operating activities increased $17.1 million for the three months ended March 31, 2010, compared to the same period last year. This increase resulted primarily from a $26.3 increase in net income.
Net cash provided by (used in) investing activities was $44.1 million for the three months ended March 31, 2010 compared to $(5.0) million for the same period last year. The $49.0 million increase in net cash provided by investing activities was due primarily to $58.8 million in proceeds from the sale of short-term investments, offset partially by the $12.2 million increase in purchases of property, plant and equipment.
Net cash used in financing activities totaled $58.9 million for the three months ended March 31, 2010 compared to $11.7 million in the same period last year. This increase is primarily the result of an approximately $59.5 million repayment on lines of credit with the proceeds from the sale of short-term investments.
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