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Universal
Display Corporation (PANL), enabling energy-efficient
displays and lighting with its UniversalPHOLED(R) technology
and materials, today announced its results for the second quarter of
2012.
For the second quarter of 2012, the Company reported net income of $11.0
million, or $0.23 per diluted share, on revenues of $30.0 million. For
the second quarter of 2011, the Company reported net income of $3.3
million, or a loss of $0.03 per diluted share, on revenues of $11.3
million. In the second quarter of 2012, the Company recognized $15.0
million in revenue under a licensing agreement with Samsung Display
Corporation (SDC, and formerly Samsung Mobile Display) under which SDC
is obligated to make payments to the Company of $15.0 million in each of
the second and fourth quarters of this year. Results for the second
quarter of 2011 included a $4.5 million, non-cash gain on stock warrant
liability.
"We are pleased to report the best quarterly financial results in our
Company’s history," said Sidney D. Rosenblatt, Executive Vice President
and Chief Financial Officer of Universal Display. "The significant
increase in licensing revenue and a near doubling of material sales in
the quarter reflect the growth of our OLED technology. Looking at the
first half of the year, we generated over $9.2 million in operating cash
flow, while improving operating income by over $15.0 million on a $21.8
million increase in revenues compared to the first half of fiscal 2011.
We believe our financial performance illustrates our success in
leveraging our proprietary technology and materials and OLED industry
leadership to provide attractive returns for our shareholders."
Second Quarter Results
Revenues for the second quarter of 2012 were $30.0 million, a 166
percent increase compared to revenues of $11.3 million in the same
quarter of 2011. Material sales were $12.8 million in the quarter, up 92
percent from $6.7 million in the second quarter of 2011, as a result of
expanded marketplace adoption of our technology and materials. Royalty
and license fees were $15.4 million in the second quarter of 2012, up
479 percent compared to $2.7 million in the same quarter of 2011.
Royalty and license revenue in the second quarter of 2012 included the
recognition of a $15.0 million semi-annual license payment from SDC
compared to $1.8 million of SDC royalty revenue in last year’s second
quarter. Operating expenses for the second quarter of 2012 were $17.1
million compared to $12.3 million in the same quarter of 2011, primarily
due to an increase in cost of materials, employee and research and
development expenses. The Company reported operating income of $12.9
million for the second quarter of 2012, an improvement of $14.0 million
compared to an operating loss of $1.1 million for the second quarter of
2011.
Cash provided by operating activities for the second quarter of 2012 was
$11.2 million, compared to $223,000 for the second quarter of 2011.
The Company’s balance sheet remained strong, with cash and cash
equivalents and short-term investments of $350.0 million as of June 30,
2012. Subsequent to the end of the quarter, the Company used $4.0
million to fund an investment in Plextronics, and $105.0 million to
purchase approximately 1,255 OLED patents and patent applications from
Fujifilm Corporation.
First Six Months Results
Revenues for the first six months of 2012 were $42.6 million, a 104
percent increase from the first half of 2011. Material sales in the
first half of the year were $23.4 million, an increase of 108 percent
compared to material sales of $11.2 million in the first half of 2011.
Operating income in the first half of 2012 was $11.4 million, or 27
percent of revenues. Operating income in the first half of 2012
increased over $15.0 million to $11.4 million compared to the operating
loss of $3.8 million in the first half of 2011. For the first half of
2012, we reported net income of $9.7 million, or $0.21 cents per diluted
share, compared to a net loss of $8.6 million, or $0.20 per diluted
share, in the same period in 2011. The net loss in the first six months
of 2011 included a $4.5 million loss on stock warrant liability.
Mr. Rosenblatt concluded, "We believe that the widespread adoption of
OLED technology is creating growth opportunities for our innovative
technologies and materials. We are investing strategically to add new
capabilities in our existing, adjacent and developing OLED markets in a
manner designed to build effectively on our materials and technologies
where we have a leading industry position. We formed a strategic
alliance to accelerate the development and commercialization of
solution-based OLED material systems incorporating our PHOLED materials
with our partners’ hole injection and hole transport materials. And, we
most recently purchased approximately 1,255 OLED patents and patent
applications. We believe that these actions clearly demonstrate our
commitment to enhancing our portfolio of intellectual property and
materials to extend our industry leadership and help accelerate the
growth of the OLED market."
GUIDANCE
The Company’s arrangement with SDC provides a substantial amount of
visibility into its potential future financial performance. Although the
OLED industry is still at a stage where many variables can have a
material effect on growth, in an effort to increase our transparency,
Universal Display is providing the following financial guidance. Again
with the caveat that the OLED industry is still in an early stage, the
Company believes that its revenues will be in the range of $90 million
to $110 million for fiscal 2012.
In conjunction with this release, Universal Display will host a
conference call, followed by a question and answer session, on
Wednesday, August 8, 2012 at 5:00 p.m. Eastern Time. Interested parties
may participate by calling 877-340-7912 at 5:00 p.m. Eastern Time and
referencing conference ID 3189414. A taped replay of the conference call
will be available within two hours of the conclusion of the call and
will remain available through Wednesday, August 22, 2012. The number to
call for the taped replay is 888-203-1112, and the conference PIN is 3189414.
The conference call will be simultaneously broadcast live over the
Internet through a webcast on the Universal Display website. To access
the call, please visit the Events portion of the website at www.universaldisplay.com.
An online archive of the webcast will be available within two hours of
the conclusion of the call.
About Universal Display Corporation
Universal Display Corporation (PANL)
is a leader in developing and delivering state-of-the-art, organic light
emitting diode (OLED) technologies, materials and services to the
display and lighting industries. Founded in 1994, the company currently
owns or has exclusive, co-exclusive or sole license rights with respect
to more than 2,700 issued and pending patents worldwide, including those
acquired from Fujifilm. Universal Display licenses its proprietary
technologies, including its breakthrough high-efficiency UniversalPHOLED
phosphorescent OLED technology that can enable the development of low
power and eco-friendly displays and white lighting. The company also
develops and offers high-quality, state-of-the-art UniversalPHOLED
materials that are recognized as key ingredients in the fabrication of
OLEDs with peak performance. In addition, Universal Display delivers
innovative and customized solutions to its clients and partners through
technology transfer, collaborative technology development and on-site
training. To learn more about Universal Display, please visit www.universaldisplay.com.
Universal Display Corporation and the Universal Display logo are
trademarks or registered trademarks of Universal Display Corporation.
All other company, brand or product names may be trademarks or
registered trademarks.
All statements in this document that are not historical, such as
those relating to Universal Display Corporation’s technologies and
potential applications of those technologies, are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. You are cautioned not to place undue reliance on any
forward-looking statements in this document, as they reflect Universal
Display Corporation’s current views with respect to future events and
are subject to risks and uncertainties that could cause actual results
to differ materially from those contemplated. These risks and
uncertainties are discussed in greater detail in Universal Display
Corporation’s periodic reports on Form 10-K and Form 10-Q filed with the
Securities and Exchange Commission, including, in particular, the
section entitled "Risk Factors" in Universal Display Corporation’s
annual report on Form 10-K for the year ended December 31, 2011.
Universal Display Corporation disclaims any obligation to update any
forward-looking statement contained in this document.
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except for share and per share data)
June 30, December 31,
2012 2011
-------- --------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 159,599 $ 111,795
Short-term investments 190,417 234,294
Accounts receivable 9,580 10,727
Inventory 8,571 3,843
Other current assets 3,902 1,645
-------- --------
Total current assets 372,069 362,304
PROPERTY AND EQUIPMENT, net 12,011 10,884
ACQUIRED TECHNOLOGY, net 380 391
INVESTMENTS 1,172 -
OTHER ASSETS 289 299
TOTAL ASSETS $ 385,921 $ 373,878
===== ======== ===== ========
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable $ 7,071 $ 4,776
Accrued expenses 7,920 9,020
Deferred revenue 5,338 5,534
Other current liabilities 589 187
-------- --------
Total current liabilities 20,918 19,517
DEFERRED REVENUE 3,568 3,874
RETIREMENT PLAN BENEFIT LIABILITY 8,543 8,260
Total liabilities 33,029 31,651
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SHAREHOLDERS’ EQUITY:
2 2
Preferred Stock, par value $0.01 per share, 5,000,000 shares
authorized, 200,000 shares of Series A Nonconvertible Preferred
Stock issued and outstanding (liquidation value of $7.50 per share
or $1,500)
465 461
Common Stock, par value $0.01 per share, 100,000,000 shares
authorized, 46,453,060 and 46,113,296 shares issued and
outstanding at June 30, 2012 and December 31, 2011, respectively
Additional paid-in capital 562,152 561,492
Accumulated deficit (204,128 ) (213,871 )
Accumulated other comprehensive loss (5,599 ) (5,857 )
Total shareholders’ equity 352,892 342,227
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 385,921 $ 373,878
===== ======== ===== ========
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except for share and per share data)
Three Months Ended June 30,
-----------------------------------
2012 2011
---------- ----------
REVENUE:
Material sales $ 12,848 $ 6,681
Royalty and license fees 15,435 2,665
Technology development and support revenue 1,704 1,906
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Total revenue 29,987 11,252
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OPERATING EXPENSES:
Cost of material sales 1,611 142
Research and development 7,236 5,551
Selling, general and administrative 5,189 4,496
Patent costs 2,255 1,915
Royalty and license expense 786 218
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Total operating expenses 17,077 12,322
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Operating income (loss) 12,910 (1,070 )
INTEREST INCOME 357 184
INTEREST EXPENSE (18 ) (8 )
GAIN ON STOCK WARRANT LIABILITY - 4,496
INCOME BEFORE INCOME TAX EXPENSE 13,249 3,602
INCOME TAX EXPENSE (2,285 ) (289 )
NET INCOME $ 10,964 $ 3,313
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NET INCOME (LOSS) PER COMMON SHARE:
BASIC $ 0.24 $ 0.07
===== ========== = ==========
DILUTED $ 0.23 $ (0.03 )
===== ========== = ========== =
WEIGHTED AVERAGE SHARES USED IN COMPUTING NET INCOME (LOSS) PER
COMMON SHARE:
BASIC 45,953,312 45,024,373
========== ==========
DILUTED 46,857,309 45,201,175
========== ==========
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except for share and per share data)
Six Months Ended June 30,
-----------------------------------
2012 2011
---------- ----------
REVENUE:
Material sales $ 23,377 $ 11,218
Royalty and license fees 15,857 5,334
Technology development and support revenue 3,373 4,301
---------- ----------
Total revenue 42,607 20,853
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OPERATING EXPENSES:
2,699 245
Cost of material sales
Research and development 13,897 12,106
Selling, general and administrative 9,486 8,368
Patent costs 4,123 3,528
Royalty and license expense 1,036 420
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Total operating expenses 31,241 24,667
---------- ----------
Operating income (loss) 11,366 (3,814 )
INTEREST INCOME 714 280
INTEREST EXPENSE (38 ) (18 )
LOSS ON STOCK WARRANT LIABILITY - (4,430 )
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT) 12,042 (7,982 )
INCOME TAX EXPENSE (2,299 ) (586 )
NET INCOME (LOSS) $ 9,743 $ (8,568 )
===== ========== = ========== =
NET INCOME (LOSS) PER COMMON SHARE:
BASIC $ 0.21 $ (0.20 )
===== ========== = ========== =
DILUTED $ 0.21 $ (0.20 )
===== ========== = ========== =
WEIGHTED AVERAGE SHARES USED IN COMPUTING NET INCOME (LOSS) PER
COMMON SHARE:
BASIC 45,871,166 41,977,113
========== ==========
DILUTED 46,896,898 41,977,113
========== ==========
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
Six Months Ended June 30,
-------------------------------
2012 2011
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 9,743 $ (8,568 )
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
Amortization of deferred revenue (1,837 ) (1,479 )
Depreciation 927 734
Amortization of intangibles 29 19
Amortization of premium and discount on investments, net (437 ) (166 )
Stock-based employee compensation 1,951 2,151
Stock-based non-employee compensation - 2
Non-cash expense under a materials agreement - 9
437 718
Stock-based compensation to Board of Directors and Scientific
Advisory Board
Loss on stock warrant liability - 4,430
Retirement plan benefit expense 777 763
Increase (decrease) in assets:
Accounts receivable 1,147 707
Inventory (4,728 ) (459 )
Other current assets (2,257 ) (395 )
Other assets 10 (107 )
Increase in liabilities:
Accounts payable and accrued expenses 1,899 1,836
Other current liabilities 205 -
Deferred revenue 1,335 1,645
Net cash provided by operating activities 9,201 1,840
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (2,054 ) (1,510 )
Purchase of intangibles (18 ) (440 )
Purchase of investments (177,449 ) (253,904 )
Proceeds from sale of investments 220,552 45,500
Net cash provided by (used in) investing activities 41,031 (210,354 )
-------- -------- -
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from the issuance of common stock 137 249,822
Proceeds from the exercise of common stock options and warrants 943 7,543
Payment of withholding taxes related to stock-based employee (3,508 ) (3,980 )
compensation
Net cash (used in) provided by financing activities (2,428 ) 253,385
-------- - --------
INCREASE IN CASH AND CASH EQUIVALENTS 47,804 44,871
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 111,795 20,369
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 159,599 $ 65,240
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SOURCE: Universal Display Corporation
Universal Display Corporation
Investor Relations:
Gregory FCA
Joe Hassett, 610-228-2110
joeh@gregoryfca.com
or
Media Contact:
Gregory FCA
Matt McLoughlin, 610-228-2123
matt@gregoryfca.com
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