Parade Technologies Reports Third Quarter 2022 Financial Results

Financial Highlights:

• Q322 consolidated revenue US$151.04 million, compared with US$191.72 million in the year-ago quarter
• Q322 consolidated net income US$32.64 million; Basic and Fully diluted after-tax EPS US$0.41 (NT$12.38) and US$0.40 (NT$12.21), respectively

SAN JOSE, Calif.–(BUSINESS WIRE)–Parade Technologies, Ltd. (Taipei Exchange: 4966.TWO), a leading high-speed interface IC supplier, today announced financial results for the third quarter fiscal year 2022 ended September 30, 2022, and provided guidance for the fourth quarter of fiscal year 2022.

Consolidated revenue was US$151.04 million and consolidated net income was US$32.64 million. Basic and fully diluted after-tax earnings per share (“EPS”) were US$0.41 (NT$12.38) and US$0.40 (NT$12.21), respectively. These results compared to consolidated revenue US$191.72 million and consolidated net income of US$53.34 million, or US$0.67 (NT$18.71) and US$0.66 (NT$18.34) per basic and fully diluted share, in the year-ago quarter.

In US dollars, the third quarter of 2022 consolidated revenue decreased 30.30% sequentially and was down 21.22% year-over-year.

The gross profit in the third quarter of 2022 was US$68.37 million, representing a decrease of 33.20% from the previous quarter and a decrease of 27.37% compared to the same quarter of last year.

On September 14, 2022, Parade announced redriver additions to its portfolio of HDMI™ 2.1/2.0 interface and signal conditioning devices. The new PS8219 HDMI 2.1 redriver and PS8210 HDMI 2.0 redriver are pin compatible with the PS8419 HDMI 2.1 retimer currently in high-volume production. The PS8419/P8219/PS8210 pin compatibility provides OEMs with the ability to quickly switch between the retimer option for best performance and the redriver option for lowest power in less challenging signaling environments. This greatly lowers the risk to OEMs for a PCB redesign at a later time, due to compliance or production issues, offering improved time-to-market for end products.

On September 7, 2022, Parade announced the availability of the PS8570 PCI Express 4.0 16Gbps linear redriver for PC, server and datacenter applications. The PS8570 features a quad-channel unidirectional linear redriver with a 2×2 crossbar switch. The PS8570 is fully compliant with the PCI Express 4.0 specification. The PS8570 features the industry’s lowest operating power for a PCIe 4 linear redriver. OEMs can enable PCIe 4 16Gbps support for power-sensitive mobile devices. The 2×2 crossbar switch allows for flexible interconnect configurations for high performance systems.

Based on current business outlook, Parade is providing the following guidance for the fourth quarter of fiscal 2022:

• Revenue: US$100.0 ~110.0 Million
• Gross Margin: 43.5% ~47.5%
• Operating Expense: US$29.0 ~32.0 Million

The financial figures detailed above for the third quarter of 2022 have been reviewed by independent accountants.

About Parade Technologies, Ltd.

Parade Technologies, Ltd. is a leading supplier of mixed-signal ICs for a variety of popular display and high-speed interface standards used in computers, consumer electronics and display panels. The fabless semiconductor company was founded in 2005 and publicly listed on Taipei Exchange (“TPEx”) in 2011 (stock code: 4966). Parade’s portfolio of IC products serves the growing demand for HDMI™, DisplayPort™, SATA, and USB ICs for display, storage and interface applications.

In addition to being a technology innovator, Parade is an active participant and leader in industry standards-setting organizations. Parade Technologies, Inc., a wholly owned US-based subsidiary of Parade Technologies, Ltd., is a member of VESA (Video Electronics Standard Association). Parade Technologies, Inc. has made key contributions to the development of VESA’s DisplayPort™ digital video interface standard.

Parade leverages its close relationships with market leading Tier-1 OEMs to develop ICs that provide unique system capabilities. Many of the company’s devices integrate proprietary technologies that offer superior system signal integrity, advanced system integration and enhanced power efficiency. As a result of the company’s “standards-plus” design philosophy, Parade ICs have been designed into products offered by nearly every leading computer and display vendor worldwide.

Parade Technologies, Ltd. and Subsidiaries.

The reader is advised that these consolidated financial statements have been prepared originally in NT$ and conformed with the adoption of IFRSs. In the event of any differences between NT$ and US$ version, the NT$ version shall prevail.

UNAUDITED CONSOLIDATED INCOME STATEMENTS	USD in Thousands																				NTD in Thousands
	Sequential Quarter						Three Months ended							Nine Months ended							Sequential Quarter						Three Months ended							Nine Months ended
	Sep 30,			Jun 30,			Sep 30,			Sep 30,				Sep 30,			Sep 30,				Sep 30,			Jun 30,			Sep 30,			Sep 30,				Sep 30,			Sep 30,
	2022			2022			2022			2021				2022			2021				2022			2022			2022			2021				2022			2021
Revenue		151,044			216,699			151,044			191,718				578,466			520,079				4,591,744			6,383,951			4,591,744			5,341,284				16,873,838			14,588,526
Cost of goods sold		82,671			114,340			82,671			97,582				306,959			273,460				2,513,211			3,368,457			2,513,211			2,718,646				8,959,119			7,672,505
Gross profit		68,373			102,359			68,373			94,136				271,507			246,619				2,078,533			3,015,494			2,078,533			2,622,638				7,914,719			6,916,021
Research & development expenses		21,090			21,483			21,090			19,875				63,799			56,466				641,148			632,873			641,148			553,710				1,868,145			1,584,348
Sales & marketing expenses		7,285			7,907			7,285			8,496				23,406			23,698				221,477			232,925			221,477			236,709				684,313			664,749
General & administrative expenses		5,327			6,549			5,327			6,322				18,325			17,206				161,917			192,942			161,917			176,126				535,367			482,619
Total operating expenses		33,702			35,939			33,702			34,693				105,530			97,370				1,024,542			1,058,740			1,024,542			966,545				3,087,825			2,731,716
Operating income		34,671			66,420			34,671			59,443				165,977			149,249				1,053,991			1,956,754			1,053,991			1,656,093				4,826,894			4,184,305
Non-operating income and (expenses)		1,185			566			1,185			(46	)			1,721			(580	)			36,031			16,662			36,031			(1,310	)			51,868			(16,404	)
Income before income taxes		35,856			66,986			35,856			59,397				167,698			148,669				1,090,022			1,973,416			1,090,022			1,654,783				4,878,762			4,167,901
Income tax expense		3,216			6,049			3,216			6,060				14,934			13,828				97,771			178,193			97,771			168,809				434,653			387,242
Net income		32,640			60,937			32,640			53,337				152,764			134,841				992,251			1,795,223			992,251			1,485,974				4,444,109			3,780,659
EPS – Basic (In Dollar)	$	0.41		$	0.76		$	0.41		$	0.67			$	1.92		$	1.71			$	12.38		$	22.51		$	12.38		$	18.71			$	55.74		$	47.85
Shares used in computing EPS-Basic (In thousands)		80,182			79,766			80,182			79,424				79,731			79,004				80,182			79,766			80,182			79,424				79,731			79,004
EPS – Diluted (In Dollar)	$	0.40		$	0.75		$	0.40		$	0.66			$	1.88		$	1.67			$	12.21		$	22.18		$	12.21		$	18.34			$	54.69		$	46.74
Shares used in computing EPS-Diluted (In thousands)		81,272			80,951			81,272			81,021				81,257			80,895				81,272			80,951			81,272			81,021				81,257			80,895

UNAUDITED CONSOLIDATED BALANCE SHEETS As of SEPTEMBER 30, 2022 and 2021	USD in Thousands						NTD in Thousands
	Sep 30,			Sep 30,			Sep 30,			Sep 30,
	2022			2021			2022			2021
Current assets
Cash & cash equivalents	294,933			308,491			9,364,118			8,591,470
Accounts receivable, net	53,497			62,250			1,698,539			1,733,665
Inventories, net	134,277			64,104			4,263,286			1,785,302
Other current assets	22,471			15,366			713,475			427,938
Total current assets	505,178			450,211			16,039,418			12,538,375
Non-current assets
Property, plant and equipment, net	17,033			17,814			540,799			496,115
Right-of-use assets	6,188			9,236			196,468			257,237
Intangible assets	104,853			112,376			3,329,058			3,129,677
Deferred income tax assets	10,686			7,832			339,269			218,126
Other non-current assets	152,838			73,747			4,852,598			2,053,842
Total non-current assets	291,598			221,005			9,258,192			6,154,997
Total Assets	796,776			671,216			25,297,610			18,693,372
Current Liabilities
Accounts payable	34,659			33,820			1,100,435			941,895
Other payables	36,724			37,403			1,165,986			1,041,667
Current income tax liabilities	33,537			26,318			1,064,782			732,965
Lease liabilities – current	2,865			3,527			90,960			98,228
Other current liabilities	21,004			7,047			666,878			196,229
Total current liabilities	128,789			108,115			4,089,041			3,010,984
Non-current Liabilities
Lease liabilities – non-current	3,323			5,709			105,508			159,009
Total non-current liabilities	3,323			5,709			105,508			159,009
Equity
Ordinary shares	26,742			26,636			811,962			808,705
Capital reserves	137,941			142,192			4,186,139			4,276,273
Retained earnings	538,566			421,199			15,941,317			12,653,796
Other equity	(16,777	)		(27,680	)		769,771			(2,076,222	)
Treasury shares	(21,808	)		(4,955	)		(606,128	)		(139,173	)
Total equity	664,664			557,392			21,103,061			15,523,379
Total liabilities and equity	796,776			671,216			25,297,610			18,693,372

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022 and 2021	USD in Thousands						NTD in Thousands
	Sep 30,			Sep 30,			Sep 30,			Sep 30,
	2022			2021			2022			2021
Cash flows from operating activities
Income before income tax for the period	167,698			148,669			4,878,762			4,167,901
Depreciation and amortization (including the right-of-use assets)	16,549			19,481			484,542			546,811
Loss on disposal of equipment	1			86			35			2,417
Share-based compensation cost	24,725			19,690			728,543			572,649
Interest income	(819	)		(74	)		(24,720	)		(2,070	)
Income and expenses having no effect on cash flows	40,456			39,183			1,188,400			1,119,807
Accounts receivable	(3,114	)		(6,817	)		(98,886	)		(189,863	)
Inventories	(58,498	)		(7,397	)		(1,857,313	)		(206,015	)
Other current assets	(34,338	)		(10,665	)		(993,127	)		(301,292	)
Net changes in assets relating to operating activities	(95,950	)		(24,879	)		(2,949,326	)		(697,170	)
Accounts payable	(6,187	)		(9,750	)		(196,425	)		(271,537	)
Other payables	(12,816	)		3,258			(406,910	)		90,749
Other current liabilities	10,960			1,422			347,992			39,613
Net changes in liabilities relating to operating activities	(8,043	)		(5,070	)		(255,343	)		(141,175	)
Cash provided by operations	104,161			157,903			2,862,493			4,449,363
Interest received	819			74			24,720			2,070
Income taxes paid	(1,313	)		(3,952	)		(38,444	)		(110,944	)
Income taxes received	19			2			565			52
Net cash generated from operating activities	103,686			154,027			2,849,334			4,340,541
Cash flows from investing activities
Acquisition of equipment	(5,042	)		(9,205	)		(147,620	)		(258,385	)
Acquisition of intangible assets	(61	)		(147	)		(1,797	)		(4,119	)
Increase in refundable deposits	(72,066	)		(66,264	)		(2,288,095	)		(1,845,447	)
Increase in other prepayments	(8,777	)		(5,383	)		(256,987	)		(151,088	)
Net cash used in investing activities	(85,946	)		(80,999	)		(2,694,499	)		(2,259,039	)
Cash flows from financing activities
Proceeds from exercise of employee stock options	2,448			196			71,665			5,492
Repayment of the principal portion of lease liabilities	(2,651	)		(2,783	)		(77,636	)		(78,118	)
Purchase of treasury shares	–			(10,038	)		–			(281,882	)
Treasury shares reissued to employees	34,533			11,052			959,141			310,416
Distribution of cash dividends	(93,720	)		(59,474	)		(2,622,127	)		(1,752,708	)
Cash dividend regain from canceled share-based compensation	63			42			1,870			1,269
Net cash used in financing activities	(59,327	)		(61,005	)		(1,667,087	)		(1,795,531	)
Effect of exchange rate changes	4,087			(2,678	)		1,674,627			(214,180	)
Net increase in cash and cash equivalents	(37,500	)		9,345			162,375			71,791
Cash and cash equivalents at beginning of period	332,433			299,146			9,201,743			8,519,679
Cash and cash equivalents at end of period	294,933			308,491			9,364,118			8,591,470

 

Contacts

Parade Technologies

Yo-Ming Chang, +886-2-2627-9109

[email protected]