Quarterly Report • Oct 25, 2017
Quarterly Report
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25 October 2017
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* 1 USD = NOK 7.99 (24 OCT. 17)
Aalborg (Denmark) R&D and Engineering
Cumulative total number of million units
| DA | |
|---|---|
DESKTOP SEGMENT
Workstation Gaming/Performance DT D I Y
11
DESKTOP SEGMENT
| Do-It-Yourself PC enthusiasts 84% sales* |
|
|---|---|
| Gaming and Performance Desktop PCs 15% sales* |
|
| Enterprise Workstations 1% sales* |
USD thousands
DATA CENTER SEGMENT
13
• Order from a new channel partner to service demand from a new OEM customer for an undisclosed
14
Data center gross margin at 30.5% (31.9%)
Desktop EBITDA margin of 32.5% (36.4%)
| USD (000's) | Q3 2017 | Q3 2016 | ||||||
|---|---|---|---|---|---|---|---|---|
| Group | Desktop | Data center | Group | Desktop | Data center | |||
| Revenue | 17 652 | 15 614 | 2 038 | 14 249 | 12 431 | 1 818 | ||
| Gross Margin | 37.3 % | 38.2% | 30.5% | 41.0 % | 42.4% | 31.9% | ||
| Other operating expenses | 3 079 | 886 | 2 193 | 2 330 | 748 | 1 582 | ||
| EBITDA adjusted | 3 510 | 5 081 | (1 571) | 3 517 | 4 519 | (1 002) | ||
| Depreciations | 712 | 235 | 477 | 594 | 161 | 433 | ||
| Share based compensation | 409 | 114 | 295 | 81 | 32 | 49 | ||
| E B I T | 2 389 | 4 732 | (2 343) | 2 842 | 4 326 | (1 484) | ||
| EBIT Margin | 13.5 % | 30.3% | N/A | 19.9 % | 34.8% | N/A | ||
| HQ, Litigation expenses, net | 254 | 443 | ||||||
| HQ, Share based compensation | 144 | 34 | ||||||
| HQ, Other | 268 | 322 | ||||||
| Headquarters costs | 666 | 799 | ||||||
| EBIT, total | 1 723 | 2 043 |
| USD (000's) | Q3 2017 | Q2 2017 | Q1 2017 | Q4 2016 | Q3 2016 |
|---|---|---|---|---|---|
| Income (loss) for the period | 1 376 | (625) | 151 | 7 578 | 2 055 |
| Depreciation, amortization and impairment | 712 | 631 | 388 | 563 | 598 |
| Finance cost (income) and taxes | 22 | 10 | 8 | (4 707) | 6 |
| Share based compensation | 552 | 491 | 72 | 88 | 115 |
| Changes in current assets other than cash | (2 584) | (198) | 4 353 | (4 182) | (3 142) |
| Changes in payables and accrued liabilities | 2 387 | 2 576 | (5 769) | 1 342 | 3 670 |
| Net cash provided (used) in operating activities | 2 465 | 2 885 | ( 797) | 682 | 3 302 |
| Additions to intangible assets and other assets | (748) | (674) | (391) | (433) | (398) |
| Purchase of property and equipment & other assets | (410) | (637) | (225) | (528) | (169) |
| Net cash used in investing activities | (1 158) | (1 311) | (616) | (961) | (567) |
| Proceeds from debt issuance, other LT liabilities | |||||
| Cash flows on credit lines/debt/lease | (268) | 286 | (213) | 125 | (44) |
| Issuance of capital / conv debt / dividend | 45 | (2 281) | 274 | 112 | - |
| Net cash provided (used) by financing activities | (223) | (1 995) | 61 | 237 | (44) |
| Effect of exchange rate changes on cash | 401 | 491 | (74) | (641) | 25 |
| Net changes in cash and cash equivalents | 1 485 | 70 | (1 426) | ( 683) | 2 716 |
| Cash and cash equivalents at beginning of period | 16 254 | 16 184 | 17 610 | 18 293 | 15 577 |
| Cash and cash equivalents at end of period | 17 739 | 16 254 | 16 184 | 17 610 | 18 293 |
| Q2 2017 | Q1 2017 | Q4 2016 | Q3 2016 |
|---|---|---|---|
| (625) | 151 | 7578 | 2055 |
| 631 | 388 | 563 | 598 |
| 10 | 8 | (4707) | 6 |
| 491 | 72 | 88 | 115 |
| (198) | 4 3 5 3 | (4182) | (3142) |
| 2576 | (5769) | 1 3 4 2 | 3670 |
| 2885 | (797) | 682 | 3 3 0 2 |
| (674) | (391) | (433) | (398) |
| (637) | (225) | (528) | (169) |
| (1311) | (616) | (961) | (567) |
| 286 | (213) | 125 | (44) |
| (2 281) | 274 | 112 | |
| (1995) | 61 | 237 | (44) |
| 491 | (74) | (641) | 25 |
| 70 | (1426) | (683) | 2716 |
| 16 184 | 17610 | 18 2 93 | 15 5 7 7 |
| 16 254 | 16 184 | 17610 | 18 293 |
| Outlook | |
|---|---|
| • Drive differentiation • Increase GPU attach |
Firming up full-year 2017 desktop revenue growth expectations to 15%-20% compared to the earlier announced 10%-20%* |
| • Recover market share |
DESKTOP SEGMENT
* Full year 2017 revenue guidance published 21 July 17
Exploit established leadership within HPC
| Goal | Strategy |
|---|---|
| Increase end-user adoption with existing OEMs Add new OEMs |
|
| segment |
Execute on the development agreement with the as yet to be disclosed major player in data center market
Explore potential opportunities to grow beyond the HPC
DATA CENTER SEGMENT
• Full-year 2017 data center revenue expectation changed: Now anticipating roughly the same level as in 2016 due to
• Firming up full-year 2017 desktop revenue growth expectations to 15%-20% compared to the earlier announced
| $\sim$ 100 $\mu$ Name |
the contract of the con- Holding |
Percentage | Country Account Type |
|---|---|---|---|
| SUNSTONE TECHNOLOGY | 3,186,341 | 12.5% | DNK ORDINARY |
| ARBEJDSMARKEDETS TIL | 2,015,838 | 7.9% | DNK ORDINARY |
| DANSKE BANK A/S | 1,722,795 | 6.7% | DNK NOMINEE |
| UBS SWITZERLAND AG | 1,382,580 | 5.4% | CHE NOMINEE |
| HSBC BANK PLC | 1,267,579 | 5.0% | GBR NOMINEE |
| CLEARSTREAM BANKING | 1,117,090 | 4.4% | LUX NOMINEE |
| NORDEA BANK AB | 997,273 | 3.9% | DNK NOMINEE |
| KLP AKSJENORGE | 894,535 | 3.5% | NOR ORDINARY |
| THE BANK OF NEW YORK (1) | 772,186 | 3.0% | DNK NOMINEE |
| STATE STREET BANK & | 679,295 | 2.6% | USA NOMINEE |
| KOMMUNAL | 669,922 | 2.6% | NOR ORDINARY |
| NORDNET BANK AB | 628,837 | 2.5% | SWE NOMINEE |
| THE BANK OF NEW YORK | 537,895 | 2.1% | BEL NOMINEE |
| EUROCLEAR BANK S.A./ | 530,636 | 2.1% | BEL NOMINEE |
| RBC INVESTOR SERVICE | 517,666 | 2.0% | LUX NOMINEE |
| VERDIPAPIRFONDET DNB | 456,579 | 1.8% | NOR ORDINARY |
| SKANDINAVISKA ENSKIL | 447,678 | 1.8% | SWE NOMINEE |
| J.P. MORGAN CHASE (1) | 424,573 | 1.7% | GBR NOMINEE |
| CITIBANK, N.A. | 423,840 | 1.6% | KWT NOMINEE |
| J.P. MORGAN CHASE | 332,000 | 1.3% | DEU NOMINEE |
| Total Top 20 | 19,005,138 | 74.4% | |
| Other Shareholders | 6,188,811 | 24.2% | |
| ASETEK Treasury Shares | 353,709 | 1.4% | |
| Total share capital | 25,547,658 | 100.0% |
| Nine months ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Figures in USD (000's) | Q3 2017 | Q3 2016 | 30-Sep-17 | 30-Sep-16 | 2016 | ||||
| Unaudited | Unaudited | Unaudited | Unaudited | ||||||
| Revenue | \$ | 17,652 | \$ | 14,249 | \$ | 40,270 | \$ | 33,009 | \$ 50,921 |
| Cost of sales | 11,063 | 8,405 | 25,362 | 19,927 | 31,171 | ||||
| Gross profit | 6,589 | 5,844 | 14,908 | 13,082 | 19,750 | ||||
| Research and development | 1,099 | 834 | 2,989 | 2,390 | 3,428 | ||||
| Selling, general and administrative | 4,113 | 2,967 | 10,944 | 8,506 | 11,653 | ||||
| Other income | (346) | - | (997) | - | - | ||||
| Total operating expenses | 4,866 | 3,801 | 12,936 | 10,896 | 15,081 | ||||
| Operating income | 1,723 | 2,043 | 1,972 | 2,186 | 4,669 | ||||
| Foreign exchange (loss) gain | (319) | (11) | (991) | (95) | 330 | ||||
| Finance costs | (22) | (6) | (34) | (29) | (8) | ||||
| Total financial income (expenses) | (341) | (17) | (1,025) | (124) | 322 | ||||
| Income before tax | 1,382 | 2,026 | 947 | 2,062 | 4,991 | ||||
| Income tax (expense) benefit | (6) | 29 | (45) | (3) | 4,646 | ||||
| Income for the period | 1,376 | 2,055 | 902 | 2,059 | 9,637 | ||||
| Other comprehensive income items that may be reclassified to profit or loss in subsequent periods: Foreign currency translation adjustments Total comprehensive income |
\$ | 490 1,866 |
\$ | 20 2,075 |
\$ | 1,217 2,119 |
\$ | 120 2,179 |
\$ (455) 9,182 |
| Income per share (in USD): | |||||||||
| Basic | \$ | 0.05 | \$ | 0.08 | \$ | 0.04 | \$ | 0.08 | \$ 0.39 |
| Diluted | \$ | 0.05 | \$ | 0.08 | \$ | 0.03 | \$ | 0.08 | \$ 0.38 |
| Figures in USD (000's) | 30 Sept 2017 | 31 Dec 2016 |
|---|---|---|
| ASSETS | Unaudited | |
| Non-current assets | ||
| Intangible assets \$ |
2 573 \$ |
1 871 |
| Property and equipment | 3 421 | 1 684 |
| Deferred income tax assets | 5 107 | 4 874 |
| Other assets | 722 | 642 |
| Total non-current assets | 11 823 | 9 071 |
| Current assets | ||
| Inventory | 1 799 | 1 158 |
| Trade receivables and other | 12 550 | 13 325 |
| Cash and cash equivalents | 17 739 | 17 610 |
| Total current assets | 32 088 | 32 093 |
| \$ Total assets |
43 911 \$ |
41 164 |
| EQUITY AND LIABILITIES | ||
| Equity | ||
| Share capital \$ |
418 \$ |
417 |
| Retained earnings | 27 762 | 28 130 |
| Translation and other reserves | 963 | (257) |
| Total equity | 29 143 | 28 290 |
| Non-current liabilities | ||
| Long-term debt | 834 | 264 |
| Total non-current liabilities | 834 | 264 |
| Current liabilities | ||
| Short-term debt | 702 | 524 |
| Accrued liabilities | 2 318 | 1 305 |
| Accrued compensation & employee benefits | 1 577 | 1 413 |
| Trade payables | 9 337 | 9 368 |
| Total current liabilities | 13 934 | 12 610 |
| Total liabilities | 14 768 | 12 874 |
| \$ Total equity and liabilities |
43 911 \$ |
41 164 |
| Unaudited | |||||||
|---|---|---|---|---|---|---|---|
| Share | Share | Translation | Other | Retained | |||
| Figures in USD (000's) | capital | premium | reserves | reserves | earnings | Total | |
| Equity at January 1, 2017 | \$ 417 |
\$ | - | \$ (248) \$ |
(9) \$ |
28 130 \$ |
28 290 |
| Total comprehensive income - nine months ended Sept 30, 2017 | |||||||
| Income for the period | - | - | - | - | 902 | 902 | |
| Foreign currency translation adjustments | - | - | 1 217 | - | - | 1 217 | |
| Total comprehensive income - nine months ended Sept 30, 2017 | - | - | 1 217 | - | 902 | 2 119 | |
| Transactions with owners - nine months ended Sept 30, 2017 | |||||||
| Shares issued | 1 | - | - | 3 | 521 | 525 | |
| Share based payment expense | - | - | - | - | 1 116 | 1 116 | |
| Dividends | - | - | - | - | (2 907) | (2 907) | |
| Transactions with owners - nine months ended Sept 30, 2017 | 1 | - | - | 3 | (1 270) | (1 266) | |
| Equity at September 30, 2017 | \$ 418 |
\$ | - | \$ 969 \$ |
(6) \$ |
27 762 \$ |
29 143 |
| Equity at January 1, 2016 | \$ 416 |
\$ | 76 665 | \$ 207 \$ |
(9) \$ |
(58 633) \$ |
18 646 |
| Total comprehensive income - nine months ended Sept 30, 2016 Loss for the period |
- | - | - | - | 2 059 | 2 059 | |
| Foreign currency translation adjustments | - | - | 120 | - | - | 120 | |
| Total comprehensive income - nine months ended Sept 30, 2016 | - | - | 120 | - | 2 059 | 2 179 | |
| Transactions with owners - nine months ended Sept 30, 2016 | |||||||
| Shares issued | - | 21 | - | - | - | 21 | |
| Share based payment expense | - | - | - | - | 240 | 240 | |
| Transactions with owners - nine months ended Sept 30, 2016 | - | 21 | - | - | 240 | 261 | |
| Equity at September 30, 2016 | \$ 416 |
\$ | 76 686 | \$ 327 \$ |
(9) \$ |
(56 334) \$ |
21 086 |
| Figures in USD (000's) | Share capital |
Share premium |
Translation reserves |
Other reserves |
Retained earnings |
Total | ||
|---|---|---|---|---|---|---|---|---|
| Equity at January 1, 2017 | \$ 417 |
\$ | - | \$ | (248) \$ |
(9) \$ |
28 130 \$ |
28 290 |
| Total comprehensive income - nine months ended Sept 30, 2017 | ||||||||
| Income for the period | - | - | - | - | 902 | 902 | ||
| Foreign currency translation adjustments | - | - | 1 217 | - | - | 1 217 | ||
| Total comprehensive income - nine months ended Sept 30, 2017 | - | - | 1 217 | - | 902 | 2 119 | ||
| Transactions with owners - nine months ended Sept 30, 2017 | ||||||||
| Shares issued | 1 | - | - | 3 | 521 | 525 | ||
| Share based payment expense | - | - | - | - | 1 116 | 1 116 | ||
| Dividends | - | - | - | - | (2 907) | (2 907) | ||
| Transactions with owners - nine months ended Sept 30, 2017 | 1 | - | - | 3 | (1 270) | (1 266) | ||
| Equity at September 30, 2017 | \$ 418 |
\$ | - | \$ | 969 \$ |
(6) \$ |
27 762 \$ |
29 143 |
| Equity at January 1, 2016 | \$ 416 |
\$ | 76 665 | \$ | 207 \$ |
(9) \$ |
(58 633) \$ |
18 646 |
| Total comprehensive income - nine months ended Sept 30, 2016 Loss for the period |
- | - | - | - | 2 059 | 2 059 | ||
| Foreign currency translation adjustments | - | - | 120 | - | - | 120 | ||
| Total comprehensive income - nine months ended Sept 30, 2016 | - | - | 120 | - | 2 059 | 2 179 | ||
| Transactions with owners - nine months ended Sept 30, 2016 | ||||||||
| Shares issued | - | 21 | - | - | - | 21 | ||
| Share based payment expense | - | - | - | - | 240 | 240 | ||
| Transactions with owners - nine months ended Sept 30, 2016 | - | 21 | - | - | 240 | 261 | ||
| Equity at September 30, 2016 | \$ 416 |
\$ | 76 686 | \$ | 327 \$ |
(9) \$ |
(56 334) \$ |
21 086 |
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