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Parade Technologies Reports Third Quarter 2020 Financial Results

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Financial Highlights:

  • Q320 consolidated revenue US$150.15 million, compared with US$101.45 million in the year-ago quarter
  • Q320 consolidated net income US$36.75 million; Basic and Fully diluted after-tax EPS US$0.47 (NT$13.80) and US$0.46 (NT$13.52), 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 2020 ended September 30, 2020, and provided guidance for the fourth quarter of fiscal year 2020.

Consolidated revenue was US$150.15 million and consolidated net income was US$36.75 million. Basic and fully diluted after-tax earnings per share (�EPS�) were US$0.47 (NT$13.80) and US$0.46 (NT$13.52), respectively. These results compared to consolidated revenue US$101.45 million and consolidated net income of US$21.87 million, or US$0.28 (NT$8.86) and US$0.28 (NT$8.67) per basic and fully diluted share, in the year-ago quarter.

In US dollars, the third quarter of 2020 consolidated revenue increased 23.53% sequentially and was up 48.00% year-over-year.

The gross profit in the third quarter of 2020 was US$66.07 million, representing an increase of 22.80% from the previous quarter and an increase of 51.67% compared to the same quarter of last year.

On August 13, 2020, Parade announced the mass production of the PS8926 PCI Express Gen 4 retimer for enterprise system deployment. This integrated device has completed rigorous testing and validation in enterprise-level network and storage systems now entering production. The PS8926 supports up to 16 bi-directional PCI Express Gen 4 lanes using 32 high-speed data channels operating at 16 Gbps. Parade�s PCI Express Gen 4 family of retimer devices, including the PS8925, PS8926, and PS8926A, all support Parade�s exclusive PABR (Protocol Aware Bit-level Retimer) mode that reduces latency to 2 nsec, well below the typical 43 nsec expected for a spec-compliant PCI Express Gen 4 retimer, increasing data throughput and greatly reducing memory access time.

Based on current business outlook, Parade is providing the following guidance for the fourth quarter of fiscal 2020:

  • Revenue: US$135 ~149 Million
  • Gross Margin: 41.5% ~44.5%
  • Operating Expense: US$27.0 ~28.0 Million

The financial figures detailed above for the third quarter of 2020 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 STATEMENTS OF COMPREHENSIVE INCOME 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,

2020

2020

2020

2019

2020

2019

2020

2020

2020

2019

2020

2019

�
Revenue

150,146

�

121,543

150,146

�

101,447

370,049

285,870

4,421,777

�

3,632,919

4,421,777

�

3,165,157

11,016,325

8,879,034

Cost of goods sold

84,072

�

67,738

84,072

�

57,883

206,272

164,963

2,475,915

�

2,024,686

2,475,915

�

1,805,971

6,140,454

5,123,556

Gross profit

66,074

�

53,805

66,074

�

43,564

163,777

120,907

1,945,862

�

1,608,233

1,945,862

�

1,359,186

4,875,871

3,755,478

Research & development expenses

16,443

�

15,198

16,443

�

13,523

45,539

39,663

484,243

�

454,265

484,243

�

421,915

1,356,986

1,231,941

Sales & marketing expenses

6,413

�

5,239

6,413

�

4,778

16,516

13,776

188,851

�

156,612

188,851

�

149,079

491,905

427,884

General & administrative expenses

4,640

�

4,516

4,640

�

3,433

12,797

9,656

136,635

�

134,965

136,635

�

107,113

381,245

299,942

Expected credit loss

-

�

-

-

�

12

-

12

-

�

-

-

�

367

-

367

Total operating expenses

27,496

�

24,953

27,496

�

21,746

74,852

63,107

809,729

�

745,842

809,729

�

678,474

2,230,136

1,960,134

Operating income

38,578

�

28,852

38,578

�

21,818

88,925

57,800

1,136,133

�

862,391

1,136,133

�

680,712

2,645,735

1,795,344

Non-operating income and expenses

(87

)

143

(87

)

1,197

873

2,805

(2,557

)

4,256

(2,557

)

37,370

26,307

87,272

Income before income taxes

38,491

�

28,995

38,491

�

23,015

89,798

60,605

1,133,576

�

866,647

1,133,576

�

718,082

2,672,042

1,882,616

Income tax expense

1,745

�

772

1,745

�

1,150

4,142

2,583

51,404

�

23,084

51,404

�

35,891

123,416

80,274

Net income

36,746

�

28,223

36,746

�

21,865

85,656

58,022

1,082,172

�

843,563

1,082,172

�

682,191

2,548,626

1,802,342

EPS - Basic (In Dollar)

$0.47

�

$0.36

$0.47

�

$0.28

$1.09

$0.76

$13.80

�

$10.81

$13.80

�

$8.86

$32.58

$23.58

Shares used in computing EPS-Basic (In thousands)

78,437

�

78,034

78,437

�

76,980

78,229

76,436

78,437

�

78,034

78,437

�

76,980

78,229

76,436

EPS - Diluted (In Dollar)

$0.46

�

$0.35

$0.46

�

$0.28

$1.07

$0.74

$13.52

�

$10.54

$13.52

�

$8.67

$31.77

$22.97

Shares used in computing EPS-Diluted (In thousands)

80,018

�

80,012

80,018

�

78,648

80,230

78,470

80,018

�

80,012

80,018

�

78,648

80,230

78,470

UNAUDITED CONSOLIDATED BALANCE SHEETS USD in Thousands NTD in Thousands
As of September 30, 2020 and 2019 Sep 30, Sep 30, Sep 30, Sep 30,

2020

2019

2020

2019

Current assets
Cash & cash equivalents

271,266

�

232,943

�

7,893,836

�

7,230,564

�

Accounts receivable, net

60,524

�

50,367

�

1,761,246

�

1,563,373

�

Inventories, net

38,457

�

30,935

�

1,119,095

�

960,219

�

Prepayments

11,195

�

7,579

�

325,790

�

235,264

�

Other current assets

17,589

�

12,020

�

511,837

�

373,108

�

Total current assets

399,031

�

333,844

�

11,611,804

�

10,362,528

�

Non-current assets
Property, plant and equipment, net

12,731

�

8,878

�

370,459

�

275,580

�

Right-of-use assets

5,130

�

6,648

�

149,293

�

206,356

�

Intangible assets

113,120

�

80,403

�

3,291,791

�

2,495,704

�

Deferred income tax assets

6,414

�

2,631

�

186,643

�

81,654

�

Other non-current assets

903

�

849

�

26,285

�

26,344

�

Total non-current assets

138,298

�

99,409

�

4,024,471

�

3,085,638

�

Total Assets

537,329

�

433,253

�

15,636,275

�

13,448,166

�

�
Current Liabilities
Accounts payable

36,293

�

28,202

�

1,056,122

�

875,382

�

Other payables

27,478

�

19,634

�

799,615

�

609,445

�

Current income tax liabilities

21,514

�

18,423

�

626,055

�

571,853

�

Lease liabilities - current

1,987

�

2,159

�

57,827

�

67,029

�

Other current liabilities

8,109

�

6,799

�

235,961

�

211,045

�

Total current liabilities

95,381

�

75,217

�

2,775,580

�

2,334,754

�

Non current Liabilities
Lease liabilities - non-current

3,143

�

4,489

�

91,466

�

139,327

�

Total non-current liabilities

3,143

�

4,489

�

91,466

�

139,327

�

Equity
Ordinary shares

26,597

�

26,313

�

807,581

�

799,222

�

Capital reserves

137,325

�

105,418

�

4,144,850

�

3,207,043

�

Retained earnings

315,705

�

250,934

�

9,667,305

�

7,701,891

�

Other equity

(40,822

)

(25,822

)

(1,850,507

)

(632,346

)

Treasury shares

-

�

(3,296

)

-

�

(101,725

)

Total equity

438,805

�

353,547

�

12,769,229

�

10,974,085

�

Total liabilities and equity

537,329

�

433,253

�

15,636,275

�

13,448,166

�

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS USD in Thousands NTD in Thousands
For nine months ended September 30, 2020 and 2019 Sep 30, Sep 30, Sep 30, Sep 30,

2020

�

2019

�

2020

�

2019

�

Cash flows from operating activities
Income before income tax for the period

89,798

�

60,605

�

2,672,042

�

1,882,616

�

Depreciation and amortization (including the right-of-use assets)

11,568

�

11,129

�

344,955

�

345,544

�

Expected credit loss

-

�

12

�

-

�

367

�

Loss on disposal of equipment

-

�

4

�

-

�

128

�

Share-based compensation cost

15,017

�

7,246

�

453,796

�

223,663

�

Interest income

(914

)

(2,625

)

(27,482

)

(81,601

)

Income and expenses having no effect on cash flows

25,671

�

15,766

�

771,269

�

488,101

�

Accounts receivable

(20,580

)

(4,434

)

(598,864

)

(137,631

)

Inventories

(6,976

)

4,866

�

(203,014

)

151,026

�

Prepayments

(2,852

)

(844

)

(82,992

)

(26,189

)

Other current assets

(5,886

)

(1,169

)

(171,270

)

(36,297

)

Net changes in assets relating to operating activities

(36,294

)

(1,581

)

(1,056,140

)

(49,091

)

Accounts payable

10,069

�

(3,425

)

293,008

�

(106,304

)

Other payables

2,839

�

(714

)

82,611

�

(22,168

)

Other current liabilities

1,767

�

(515

)

51,432

�

(15,994

)

Net changes in liabilities relating to operating activities

14,675

�

(4,654

)

427,051

�

(144,466

)

Cash provided by operations

93,850

�

70,136

�

2,814,222

�

2,177,160

�

Interest received

914

�

2,625

�

27,263

�

81,509

�

Income taxes paid

(7,427

)

(834

)

(221,470

)

(25,885

)

Income taxes received

1

�

-

�

12

�

-

�

Net cash provided by operating activities

87,338

�

71,927

�

2,620,027

�

2,232,784

�

Cash flows from investing activities
Acquisition of equipment

(6,399

)

(1,388

)

(190,817

)

(43,085

)

Acquisition of intangible assets

(3,952

)

(3,614

)

(117,841

)

(112,205

)

Increase in refundable deposits

(37

)

(40

)

(1,090

)

(1,232

)

Acquisition of business combinations

(37,169

)

-

�

(1,112,458

)

-

�

Net cash used in investing activities

(47,557

)

(5,041

)

(1,422,206

)

(156,522

)

Cash flows from financing activities
Proceeds from exercise of employee stock options

498

�

458

�

14,865

�

14,224

�

Repayment of the principal portion of lease liabilities

(1,637

)

(1,521

)

(48,834

)

(47,229

)

Treasury shares reissued to employees

3,296

�

3,296

�

101,725

�

101,725

�

Distribution of cash dividends

(39,369

)

(32,529

)

(1,216,887

)

(980,751

)

Cash dividend regain from canceled share-based compensation

53

�

31

�

1,584

�

930

�

Net cash used in financing activities

(37,159

)

(30,265

)

(1,147,547

)

(911,101

)

Effect of exchange rate changes on cash and cash equivalents

(1,736

)

621

�

(262,438

)

53,475

�

Net (decrease) increase in cash and cash equivalents

886

�

37,242

�

(212,164

)

1,218,636

�

Cash and cash equivalents at beginning of period

270,380

�

195,701

�

8,106,000

�

6,011,928

�

Cash and cash equivalents at end of period

271,266

�

232,943

�

7,893,836

�

7,230,564

�

�

Contacts

Parade Technologies

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

[email protected]

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