Parade Technologies Reports Fourth Quarter and Fiscal 2022 Financial Results

Financial Highlights:

• Q422 consolidated revenue US$101.45 million, compared with US$194.26 million in the year-ago quarter
• Q422 consolidated net income US$14.48 million; Basic and Fully diluted after-tax EPS US$0.18 (NT$5.67) and US$0.18 (NT$5.60), 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 fourth fiscal quarter and fiscal year 2022 ended December 31, 2022, and provided guidance for the first quarter of fiscal year 2023.

Consolidated revenue was US$101.45 million and consolidated net income was US$14.48 million. Basic and fully diluted after-tax earnings per share (�EPS”) were US$0.18 (NT$5.67) and US$0.18 (NT$5.60), respectively. These results compared to consolidated revenue US$194.26 million and consolidated net income of US$52.60 million, or US$0.66 (NT$18.42) and US$0.65 (NT$18.08) per basic and fully diluted share, in the year-ago quarter.

In US dollars, the fourth quarter of 2022 consolidated revenue decreased 32.83% sequentially and was down 47.77% year-over-year.

The gross profit in the fourth quarter of 2022 was US$44.68 million, representing a decrease of 34.66% from the previous quarter and a decrease of 52.46% compared to the same quarter of last year.

The Company also reported financial results for fiscal year 2022. Consolidated revenue was US$679.92 million, representing a decrease of 4.82% from US$714.33 million in the prior year. Gross profit was US$316.18 million and operating income was US$180.00 million. Net income for fiscal year 2022 was US$167.25 million, or US$2.09 (NT$61.35) per basic share and US$2.06 (NT$60.35) per fully diluted share. These results compared with net income of US$187.44 million, or US$2.37 (NT$66.29) per basic share and US$2.32 (NT$64.79) per fully diluted share in the prior year.

Based on current business outlook, Parade is providing the following guidance for the first quarter of fiscal 2023:

• Revenue: US$90.0 ~105.0 Million
• Gross Margin: 43% ~47%
• Operating Expense: US$29.0 ~32.0 Million

On January 18, 2023, Parade introduced the new PS8936 retimer chip developed for PCI Express Rev. 5.0 and Compute Express Link (CXL), supporting sixteen bidirectional lanes. In addition to supporting the 32 Gbps data rate offered by the PCI Express 5.0 specification, it also supports 2.5 Gbps, 5 Gbps, 8 Gbps and 16 Gbps for backward compatibility with earlier PCI Express revisions. The PS8936 is the PCI Express Gen 5 retimer addition to Parade’s PS8926 and PS8925 PCI Express 4.0 16-lane and 4-lane retimer family currently in production and PS8570 PCI Express 4.0 4-channel linear redriver in sampling stage. The PS8936 is in full compliance with the PCI Express 5.0 specification and has been successfully tested in multiple OEM systems and PCI Express 5.0 CPU platforms. It is designed for use in enterprise systems including servers and data storage, and in high-performance workstations.

On January 25, 2023, Parade announced a new offering in its eDP Timing Controller (Tcon) with embedded driver (TED) product category. TC3222 provides a single-chip display driver solution as an alternative to the traditional multichip solutions (eDP Tcon + source drivers). The TC3222 provides a lower cost alternative to the TC3210 by eliminating the frame buffer required to support PSR (Panel Self Refresh). Both versions feature narrow COG package dimensions to support new generations of sleek LCD panel assemblies. TC3222 is compliant with the eDP 1.4b standard and supports Multi-SST Operation (MSO), Dynamic Refresh Rates, and more. The TC3222 is designed for Flip Chip on Glass application on both a-Si (Amorphous Silicon) and Oxide type TFT panels. It requires no external crystal or timing reference, includes a programmable gamma buffer, as well as Parade’s exclusive Smart-Backlight™ feature for additional color and power optimization. The fully programmable row and column driver timing enables the TC3222 to serve a broad range of panel types, and it provides synchronization signals that support a wide range of touch controllers.

The financial figures detailed above for the fourth quarter of 2022 and for the year ended December 31, 2022 have not been audited or 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							Twelve Months ended							Sequential Quarter						Three Months ended							Twelve Months ended
	Dec 31,			Sep 30,			Dec 31,			Dec 31,				Dec 31,			Dec 31,				Dec 31,			Sep 30,			Dec 31,			Dec 31,				Dec 31,			Dec 31,
	2022			2022			2022			2021				2022			2021				2022			2022			2022			2021				2022			2021
Revenue		101,450			151,044			101,450			194,255				679,916			714,334				3,181,446			4,591,744			3,181,446			5,406,120				20,055,284			19,994,646
Cost of goods sold		56,774			82,671			56,774			100,279				363,733			373,739				1,780,425			2,513,211			1,780,425			2,790,774				10,739,544			10,463,279
Gross profit		44,676			68,373			44,676			93,976				316,183			340,595				1,401,021			2,078,533			1,401,021			2,615,346				9,315,740			9,531,367
Research & development expenses		20,074			21,090			20,074			20,420				83,873			76,886				629,511			641,148			629,511			568,288				2,497,656			2,152,636
Sales & marketing expenses		6,469			7,285			6,469			8,005				29,875			31,703				202,857			221,477			202,857			222,773				887,170			887,522
General & administrative expenses		4,114			5,327			4,114			6,429				22,439			23,635				129,023			161,917			129,023			178,932				664,390			661,551
Total operating expenses		30,657			33,702			30,657			34,854				136,187			132,224				961,391			1,024,542			961,391			969,993				4,049,216			3,701,709
Operating income		14,019			34,671			14,019			59,122				179,996			208,371				439,630			1,053,991			439,630			1,645,353				5,266,524			5,829,658
Non-operating income and (expenses)		1,800			1,185			1,800			(170	)			3,521			(750	)			56,441			36,031			56,441			(4,721	)			108,309			(21,125	)
Income before income taxes		15,819			35,856			15,819			58,952				183,517			207,621				496,071			1,090,022			496,071			1,640,632				5,374,833			5,808,533
Income tax expense		1,335			3,216			1,335			6,352				16,269			20,180				41,861			97,771			41,861			176,784				476,514			564,026
Net income		14,484			32,640			14,484			52,600				167,248			187,441				454,210			992,251			454,210			1,463,848				4,898,319			5,244,507
EPS – Basic (In Dollar)	$	0.18		$	0.41		$	0.18		$	0.66			$	2.09		$	2.37			$	5.67		$	12.38		$	5.67		$	18.42			$	61.35		$	66.29
Shares used in computing EPS-Basic (In thousands)		80,160			80,182			80,160			79,491				79,845			79,114				80,160			80,182			80,160			79,491				79,845			79,114
EPS – Diluted (In Dollar)	$	0.18		$	0.40		$	0.18		$	0.65			$	2.06		$	2.32			$	5.60		$	12.21		$	5.60		$	18.08			$	60.35		$	64.79
Shares used in computing EPS-Diluted (In thousands)		81,067			81,272			81,067			80,973				81,160			80,952				81,067			81,272			81,067			80,973				81,160			80,952

UNAUDITED CONSOLIDATED BALANCE SHEETS As of DECEMBER 31, 2022 and 2021	USD in Thousands						NTD in Thousands
	Dec 31,			Dec 31,			Dec 31,			Dec 31,
	2022			2021			2022			2021
Current assets
Cash & cash equivalents	227,137			332,433			6,975,384			9,201,743
Accounts receivable, net	34,707			50,383			1,065,863			1,394,595
Inventories, net	145,493			75,779			4,468,087			2,097,554
Other current assets	20,236			12,407			621,454			343,437
Total current assets	427,573			471,002			13,130,788			13,037,329
Non-current assets
Property, plant and equipment, net	16,136			17,625			495,523			487,868
Right-of-use assets	5,302			8,474			162,812			234,571
Intangible assets	103,038			109,979			3,164,291			3,044,207
Deferred income tax assets	11,621			8,817			356,894			244,042
Other non-current assets	155,044			75,636			4,761,390			2,093,609
Total non-current assets	291,141			220,531			8,940,910			6,104,297
Total Assets	718,714			691,533			22,071,698			19,141,626
Current Liabilities
Accounts payable	13,003			40,846			399,308			1,130,616
Other payables	100,624			90,291			2,970,174			2,519,249
Current income tax liabilities	12,846			18,678			394,513			517,012
Lease liabilities – current	2,656			3,574			81,569			98,946
Other current liabilities	13,474			10,044			413,782			278,008
Total current liabilities	142,603			163,433			4,259,346			4,543,831
Non-current Liabilities
Lease liabilities – non-current	2,646			4,900			81,243			135,625
Total non-current liabilities	2,646			4,900			81,243			135,625
Equity
Ordinary shares	26,740			26,634			811,913			808,638
Capital reserves	138,110			143,754			4,192,921			4,319,491
Retained earnings	492,999			433,068			14,671,389			12,970,276
Other equity	(14,299	)		(23,915	)		208,496			(2,070,966	)
Treasury shares	(70,085	)		(56,341	)		(2,153,610	)		(1,565,269	)
Total equity	573,465			523,200			17,731,109			14,462,170
Total liabilities and equity	718,714			691,533			22,071,698			19,141,626

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2022 and 2021	USD in Thousands						NTD in Thousands
	Dec 31,			Dec 31,			Dec 31,			Dec 31,
	2022			2021			2022			2021
Cash flows from operating activities
Income before income tax for the year	183,517			207,621			5,374,833			5,808,533
Depreciation and amortization (including the right-of-use assets)	21,960			25,509			654,416			714,503
Loss on disposal of intangible assets	665			–			19,817			–
Loss on disposal of equipment	1			86			35			2,417
Share-based compensation cost	32,529			31,676			969,165			913,618
Interest income	(2,069	)		(96	)		(63,912	)		(2,685	)
Income and expenses having no effect on cash flows	53,086			57,175			1,579,521			1,627,853
Accounts receivable	15,675			5,050			481,391			139,785
Inventories	(69,714	)		(19,072	)		(2,140,923	)		(527,908	)
Other current assets	(37,354	)		(7,774	)		(1,078,797	)		(223,290	)
Net changes in assets relating to operating activities	(91,393	)		(21,796	)		(2,738,329	)		(611,413	)
Accounts payable	(27,843	)		(2,724	)		(855,072	)		(75,409	)
Other payables	(8,977	)		15,396			(275,698	)		426,155
Other current liabilities	3,430			4,420			105,341			122,349
Net changes in liabilities relating to operating activities	(33,390	)		17,092			(1,025,429	)		473,095
Cash provided by operations	111,820			260,092			3,190,596			7,298,068
Interest received	2,069			96			63,912			2,685
Income taxes paid	(24,117	)		(17,010	)		(718,678	)		(476,455	)
Income taxes received	242			2			7,219			52
Net cash generated from operating activities	90,014			243,180			2,543,049			6,824,350
Cash flows from investing activities
Acquisition of equipment	(5,757	)		(10,584	)		(171,548	)		(296,457	)
Acquisition of intangible assets	(466	)		(395	)		(13,901	)		(11,065	)
Increase in refundable deposits	(72,127	)		(66,269	)		(2,215,017	)		(1,834,320	)
Increase in other prepayments	(11,997	)		(7,968	)		(357,512	)		(223,186	)
Net cash used in investing activities	(90,347	)		(85,216	)		(2,757,978	)		(2,365,028	)
Cash flows from financing activities
Proceeds from exercise of employee stock options	2,448			271			72,937			7,583
Repayment of the principal portion of lease liabilities	(3,663	)		(3,899	)		(109,154	)		(109,202	)
Purchase of treasury shares	(48,277	)		(61,424	)		(1,547,481	)		(1,707,978	)
Proceeds from exercise of disgorgement	–			–			11			–
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	76			62			2,245			1,881
Net cash used in financing activities	(108,603	)		(113,412	)		(3,244,428	)		(3,250,008	)
Effect of exchange rate changes	3,640			(11,265	)		1,232,998			(527,250	)
Net (decrease) increase in cash and cash equivalents	(105,296	)		33,287			(2,226,359	)		682,064
Cash and cash equivalents at beginning of year	332,433			299,146			9,201,743			8,519,679
Cash and cash equivalents at end of year	227,137			332,433			6,975,384			9,201,743

 

Contacts

Parade Technologies

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

ir@paradetech.com