Himax Technologies, Inc.

Foreign Filer Report • May 9, 2007

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FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

For the month of May, 200 7

Commission File Number: 000-51847

Himax Technologies, Inc.

(Translation of registrant’s name into English)

No.26, Zih Lian Road , Fonghua Village ,

Sinshih Township , Tainan County 744,

Taiwan, Republic of China

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F X Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes No X

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes No X

Indicate by check mark whether by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes No X

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A

Himax Technologies, Inc.

INDEX TO EXHIBITS

Exhibit
99.1	“Himax
Updates
Third Quarter, Fourth Quarter and Full Year 2006 Results” dated May 9,
2007.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

| HIMAX
TECHNOLOGIES, INC. | |
| --- | --- |
| By: | /s/
Max Chan |
| | Name:
Max Chan |
| | Title:
Chief Financial Officer |

Date: May 9th, 200 7

Exhibit 99.1

HIMAX UPDATES THIRD QUARTER, FOURTH QUARTER AND FULL YEAR 2006 RESULTS

Himax Technologies, Inc. (“Himax” or ”Company”) (Nasdaq: HIMX) today updated financial results for the third quarter, fourth quarter and full year 2006 as compared to the financial results presented previously on November 7, 2006 and February 13, 2007.

Revenues remain at $177.1 million for the third quarter, $220.9 million for the fourth quarter and $744.5 million for the full year 2006. Net incomes are updated to $0.01, $0.16 and $0.39 per share as compared to $0.02, $0.15 and $0.39 per share presented previously for the third quarter, fourth quarter and the full year 2006 respectively.

Primary changes between originally presented and updated results are noted below:

(1) operating expenses were impacted by a change in the Company’s accounting treatment of its cash signing bonus plan from deferring and amortizing over a three-year period to charging as an expense in current period when paid, (2) income tax expense was decreased due primarily to a higher estimated tax exemption and the tax effect resulting from the change in the accounting treatment of the cash signing bonus plan, and (3) changes in certain classifications, e.g., the revenues between related parties and third parties in the statements of income; prepaid expenses and property and equipment in the balance sheets and reconciled items for the cash flows from operating and investing activities in the statements of cash flows.

A reconciliation of our corrected and originally presented gross margin and operating margin excluding share-based compensation, a non-GAAP financial measure, to our corrected and originally presented GAAP gross margin and GAAP operating margin, our most comparable GAAP figure, is set out in the attached reconciliation schedule.

- Tables Attached -

1

| Himax
Technologies, Inc. | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| Unaudited
Condensed Consolidated Statements of Income | | | | | | |
| (These
interim financials do not fully comply with US GAAP because they
omit all
interim disclosure required by US GAAP.) | | | | | | |
| (Figures
in Thousands of U.S. Dollars, Except Per Share
Data) | | | | | | |
| | Three
Months Ended
September 30, 2006 | | | Changes
to the Originally Presented | | |
| | As Corrected | As Originally Presented | | | | |
| Revenues | | | | | | |
| Revenues
from
third parties, net | $ 88,878 | $ | 89,044 | $ | (166 | ) |
| Revenues
from
related parties, net | 88,227 | | 88,061 | | 166 | |
| | 177,105 | | 177,105 | | --- | |
| Costs
and expenses: | | | | | | |
| Cost
of
revenues | 1 46,287 | | 1 46,287 | | --- | |
| Research
and
development | 24,267 | | 22,685 | | 1,582 | |
| General
and
administrative | 3,190 | | 3,027 | | 163 | |
| Sales
and
marketing | 2,586 | | 2,364 | | 222 | |
| Total
costs and expenses | 176,330 | | 174,363 | | 1,967 | |
| Operating
income | 775 | | 2,742 | | (1,967 | ) |
| Non
operating income (loss): | | | | | | |
| Interest
income | 2,000 | | 2,000 | | --- | |
| Foreign
exchange losses, net | ( 1, 2 98 | ) | ( 1, 2 98 | ) | --- | |
| Other
income,
net | 59 | | 59 | | --- | |
| | 761 | | 761 | | --- | |
| Income
before income taxes and minority interest | 1,536 | | 3,503 | | (1,967 | ) |
| Income
tax benefit | (1,246 | ) | (1,246 | ) | --- | |
| Incom e before minority interest | 2,782 | | 4,749 | | (1,967 | ) |
| Minority
interest, net of tax | (157 | ) | (157 | ) | --- | |
| Net
income | $ 2,625 | $ | 4,592 | $ | (1,967 | ) |
| Basic
earnings per ordinary share and ADS | $ 0. 01 | $ | 0. 02 | $ | (0.01 | ) |
| Diluted
earnings per ordinary share and ADS | $ 0. 01 | $ | 0. 02 | $ | (0.01 | ) |
| Basic
Weighted Average Outstanding Shares | 1 97,110 | | 1 97,110 | | --- | |
| Diluted
Weighted Average Outstanding Shares | 1 99,729 | | 1 99,729 | | --- | |

2

Himax Technologies, Inc. Unaudited Condensed Consolidated Statements of Income (Figures in Thousands of U.S. Dollars, Except Per Share Data)

| | Nine
Months Ended
September 30, 2006 | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | As Corrected | As Originally Presented | | | | |
| Revenues | | | | | | |
| Revenues
from
third parties, net | $ 238,939 | $ | 239,105 | $ | (166 | ) |
| Revenues
from
related parties, net | 284,700 | | 284,534 | | 166 | |
| | 523,639 | | 523,639 | | --- | |
| Costs
and expenses: | | | | | | |
| Cost
of
revenues | 422,351 | | 422,351 | | --- | |
| Research
and
development | 46,772 | | 45,190 | | 1,582 | |
| General
and
administrative | 6,582 | | 6,419 | | 163 | |
| Sales
and
marketing | 4,690 | | 4,468 | | 222 | |
| Total
costs and expenses | 480,395 | | 478,428 | | 1,967 | |
| Operating
income | 43,244 | | 45,211 | | (1,967 | ) |
| Non
operating income (loss): | | | | | | |
| Interest
income | 4,048 | | 4,048 | | --- | |
| Impairment
loss on an investment | (1,500 | ) | (1,500 | ) | --- | |
| Foreign
exchange losses, net | (132 | ) | (132 | ) | --- | |
| Interest
expense | (311 | ) | (311 | ) | --- | |
| Other
income,
net | 172 | | 172 | | --- | |
| | 2,277 | | 2,277 | | --- | |
| Income
before income taxes and minority
interest | 45,521 | | 47,488 | | (1,967 | ) |
| Income
tax expense | 1,491 | | 1,491 | | --- | |
| Income
before minority interest | 44,030 | | 45,997 | | (1,967 | ) |
| Minority
interest, net of tax | 59 | | 59 | | --- | |
| Net
income | $ 44,089 | $ | 46,056 | $ | (1,967 | ) |
| Basic
earnings per ordinary share and ADS | $ 0.23 | $ | 0.24 | $ | (0.01 | ) |
| Diluted
earnings per ordinary share and ADS | $ 0.23 | $ | 0.24 | $ | (0.01 | ) |

3

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Balance
Sheets |
| ( Figures
i n T housands
of U . S . D ollars) |

| | Sep 3 0 , — 2006 | Sep 3 0 , — 2006 | Changes
to the Originally Presented | |
| --- | --- | --- | --- | --- |
| | As
Corrected | As
Originally Presented | | |
| Assets | | | | |
| Current
assets: | | | | |
| Cash
and cash
equivalents | $ 155,594 | $ 155,594 | $ --- | |
| Marketable
securities available-for-sale | 4,072 | 4,072 | --- | |
| Restricted
cash equivalents and marketable securities | 31 | 31 | --- | |
| Accounts
receivable, less allowance for sales
returns
and discounts | 101,660 | 101,660 | --- | |
| Accounts
receivable from related parties, less allowance for sales returns
and
discounts | 71,530 | 71,530 | --- | |
| Inventories | 10 6,977 | 10 6,977 | --- | |
| Deferred
income taxes | 11,202 | 11,202 | --- | |
| Prepaid
expenses and other current assets | 18,655 | 20,622 | (1,967 | ) |
| Total
current assets | $ 469,721 | $ 471,688 | $ (1,967 | ) |
| Property
and
equipment, net | 34,946 | 34,946 | --- | |
| Deferred
income taxes | 134 | 134 | --- | |
| Intangible
assets, net | 61 | 61 | --- | |
| Investments
in
non-marketable securities | 1,723 | 1,723 | --- | |
| Refundable
deposits | 603 | 603 | --- | |
| | 37,467 | 37,467 | --- | |
| Total
assets | $ 507,188 | $ 509,155 | $ (1,967 | ) |
| Liabilities ,
minority interest and
stockholders’ equity | | | | |
| Current
liabilities: | | | | |
| Accounts
payable | $ 106,829 | $ 106,829 | $ --- | |
| Income
tax
payable | 11,783 | 11,783 | --- | |
| Other
accrued
expenses and other current liabilities | 16,029 | 16,029 | --- | |
| Total
current liabilities | $ 134,641 | $ 134,641 | $ --- | |
| Minority
interest | $ 1,054 | $ 1,054 | $ --- | |
| Stockholders’
equity: | | | | |
| Ordinary
share, US$0.0001 par value, 500,000,000 shares authorized | 19 | 1 9 | --- | |
| Additional
paid-in capital | 260,031 | 260,031 | --- | |
| Accumulated
other comprehensive income | 27 | 27 | --- | |
| Unappropriated
earnings | 111,416 | 113,383 | (1,967 | ) |
| Total
stockholders’ equity | $ 371,493 | $ 373,460 | $ (1,967 | ) |
| Total
liabilities ,
minority interest and
stockholders’ equity | $ 507,188 | $ 509,155 | $ (1,967 | ) |

4

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Statements of Cash Flows |
| (Figures
in Thousands of U.S.
Dollars) |

| | Three
Months Ended
September 30, 2006 — As Corrected | As Originally Presented | | Changes to
the Originally Presented | | |
| --- | --- | --- | --- | --- | --- | --- |
| Cash
flows from operating activities: | | | | | | |
| Net
income | $ 2,625 | $ | 4,592 | $ | (1,967 | ) |
| Adjustments
to
reconcile net income to net cash used in operating
activities: | | | | | --- | |
| Depreciation
and amortization | 1,119 | | 1,119 | | --- | |
| Share-based
compensation expenses | 11,456 | | 11,456 | | --- | |
| Minority
interest, net of tax | 157 | | 157 | | --- | |
| Gain
on sale
of subsidiary shares, net | (11 | ) | (11 | ) | --- | |
| Gain
on sale
of marketable securities, net | (12 | ) | (12 | ) | --- | |
| Deferred
income taxes | 132 | | 132 | | --- | |
| Changes
in
operating assets and liabilities: | | | | | --- | |
| Accounts
receivable | (14,772 | ) | (14,772 | ) | --- | |
| Accounts
receivable from related parties | (5,096 | ) | (5,096 | ) | --- | |
| Inventories | (7,369 | ) | (7,369 | ) | --- | |
| Prepaid
expenses and other current assets | (2,530 | ) | (4,497 | ) | 1,967 | |
| Accounts
payable | 8,815 | | 8,815 | | --- | |
| Income
tax
payable | (1,075 | ) | (1,075 | ) | --- | |
| Other
accrued
expenses and other current liabilities | 3,477 | | 3,477 | | --- | |
| Net
cash used in operating activities | (3,084 | ) | (3,084 | ) | --- | |
| Cash
flows from investing activities: | | | | | | |
| Purchase
of
land, property
and
equipment | (5,691 | ) | (5,691 | ) | --- | |
| Purchase
of
available-for-sales marketable securities | (10,608 | ) | (10,608 | ) | --- | |
| Sales
and
maturities of available-for-sale marketable securities | 8,480 | | 8,480 | | --- | |
| Proceeds
from
sale of subsidiary shares by Himax Technologies Limited | 27 | | 27 | | --- | |
| Purchase
of
investments in non-marketable securities | (1,410 | ) | (1,410 | ) | --- | |
| Purchase
of
subsidiary shares from minority interest | (64 | ) | (64 | ) | --- | |
| Increase
in
refundable deposits | (92 | ) | (92 | ) | --- | |
| Release
of
restricted cash equivalents and marketable securities | 424 | | 424 | | --- | |
| Net
cash used in investing activities | (8,934 | ) | (8,934 | ) | --- | |

5

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Statements of Cash Flows |
| (Figures
in Thousands of U.S. Dollars) |

| | Three
Months Ended
September 30, 2006 | | | | Changes
to the Originally Presented |
| --- | --- | --- | --- | --- | --- |
| | As Corrected | | As Originally Presented | | |
| Cash
flows from financing activities: | | | | | |
| Proceeds
from
issuance of new shares by subsidiaries | 655 | | 655 | | --- |
| Net
cash provided by financing activities | 655 | | 655 | | --- |
| Effect
of
exchange rate changes on cash and cash equivalents | 73 | | 73 | | --- |
| Net
decrease in cash and cash equivalents | (11,290 | ) | (11,290 | ) | --- |
| Cash
and cash equivalents at beginning of period | 166,884 | | 166,884 | | --- |
| Cash
and cash equivalents at end of period | $ 155,594 | | $ 155,594 | | --- |
| Supplemental
disclosures of cash flow information: | | | | | |
| Cash
paid
during the period for: | | | | | |
| Interest | $ --- | | $ --- | | $ --- |
| Income
taxes | $ 21 | | $ 21 | | $ --- |
| Supplemental
disclosures of non-cash investing and financing
activities: | | | | | |
| Payable
for
purchase of equipment and construction in progress | $ (1,750 | ) | $ (1,750 | ) | $ --- |

6

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Supplemental Data - Reconciliation Schedule |
| (Figures
in Thousands of U.S. Dollars, Except Per Share
Data) |

| Gross
Margin and Operating Margin Excluding Share-based
Compensation: | Three
Months Ended
September 30, 2006 | | Changes to
the Originally Presented | |
| --- | --- | --- | --- | --- |
| | As Corrected | As Originally Presented | | |
| Revenues | $ 177,105 | $ 177,105 | $ --- | |
| Gross
profit | 30,818 | 30,818 | --- | |
| Add:
Share-based compensation – Cost of
revenues | 208 | 208 | --- | |
| Gross
profit
excluding share-based compensation | 31,026 | 31,026 | --- | |
| Gross
margin
excluding share-based compensation | 17.5 % | 17.5 % | --- | |
| Operating
income | 775 | 2,742 | (1,967 | ) |
| Add:
Share-based compensation | 11,456 | 11,456 | --- | |
| Operating
income excluding share-based compensation | 12,231 | 14,198 | (1,967 | ) |
| Operating
margin excluding share-based compensation | 6.9 % | 8.0 % | (1.1 | %) |
| Gross
margin
excluding share-based compensation equals gross profit excluding
share-based compensation divided by revenues | | | | |
| Operating
margin excluding share-based compensation equals operating income
excluding share-based compensation divided by
revenues | | | | |

| Diluted
Earnings Per Share Excluding Share-Based Compensation: | Three
Months Ended
September 30, 2006 | | Changes
to the Originally Presented | |
| --- | --- | --- | --- | --- |
| | As
Corrected | As
Originally Presented | | |
| Diluted
GAAP
EPS | $ 0.01 | $ 0.02 | $ (0.01 | ) |
| Add:
Estimated
share-based compensation per diluted share | 0.06 | 0.06 | --- | |
| Diluted
non
GAAP EPS excluding share-based compensation | $ 0.07 | $ 0.08 | $ (0.01 | ) |
| Numbers
do not
add up to rounding | | | | |

7

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Statements of Income |
| (Figures
in Thousands of U.S. Dollars, Except Per Share
Data) |

| | Three
Months Ended
December 31, 2006 | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | As Corrected | As
Originally Presented | | | | |
| Revenues | | | | | | |
| Revenues
from
third parties, net | $ 90,947 | $ | 91,920 | $ | ( 973 | ) |
| Revenues
from
related parties, net | 129,932 | | 128,959 | | 973 | |
| | 220,879 | | 220,879 | | --- | |
| Costs
and expenses: | | | | | | |
| Cost
of
revenues | 1 79,214 | | 1 79,214 | | --- | |
| Research
and
development | 13,883 | | 13,642 | | 241 | |
| General
and
administrative | 3,180 | | 3,108 | | 72 | |
| Sales
and
marketing | 2,280 | | 2,150 | | 130 | |
| Total
costs and expenses | 198,557 | | 1 98,114 | | 443 | |
| Operating
income | 22,322 | | 22,765 | | (443 | ) |
| Non
operating income (loss): | | | | | | |
| Interest
income | 1,812 | | 1,812 | | --- | |
| Foreign
exchange gains (losses), net | (209 | ) | 356 | | (565 | ) |
| Other
income,
net | 61 | | 61 | | --- | |
| | 1,664 | | 2,229 | | (565 | ) |
| Income
before income taxes and minority interest | 23,986 | | 24,994 | | (1,008 | ) |
| Income
tax benefit | (6,937 | ) | (4,211 | ) | (2,726 | ) |
| Incom e before minority interest | 30,923 | | 29,205 | | 1,718 | |
| Minority
interest, net of tax | 178 | | 183 | | (5 | ) |
| Net
income | $ 31,101 | $ | 29,388 | $ | 1,713 | |
| Basic
earnings per ordinary share and ADS | $ 0. 16 | $ | 0. 15 | $ | 0.01 | |
| Diluted
earnings per ordinary share and ADS | $ 0. 16 | $ | 0. 15 | $ | 0.01 | |
| Basic
Weighted Average Outstanding Shares | 1 98,154 | | 1 98,147 | | 7 | |
| Diluted
Weighted Average Outstanding Shares | 1 99,419 | | 1 99,518 | | (99 | ) |

8

Himax Technologies, Inc. Unaudited Condensed Consolidated Statements of Income (Figures in Thousands of U.S. Dollars, Except Per Share Data)

| | Twelve
Months Ended
December 31, 2006 | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | As Corrected | As Originally Presented | | | | |
| Revenues | | | | | | |
| Revenues
from
third parties, net | $ 329,886 | $ | 331,025 | $ | (1,139 | ) |
| Revenues
from
related parties, net | 414,632 | | 413,493 | | 1,139 | |
| | 744,518 | | 744,518 | | --- | |
| Costs
and expenses: | | | | | | |
| Cost
of
revenues | 601,565 | | 601,565 | | --- | |
| Research
and
development | 60,655 | | 58,832 | | 1,823 | |
| General
and
administrative | 9,762 | | 9,527 | | 235 | |
| Sales
and
marketing | 6,970 | | 6,618 | | 352 | |
| Total
costs and expenses | 678,952 | | 676,542 | | 2,410 | |
| Operating
income | 65,566 | | 67,976 | | (2,410 | ) |
| Non
operating income (loss): | | | | | | |
| Interest
income | 5,860 | | 5,860 | | --- | |
| Impairment
loss on an investment | (1,500 | ) | (1,500 | ) | --- | |
| Foreign
exchange gains (losses), net | (341 | ) | 224 | | (565 | ) |
| Interest
expense | (311 | ) | (311 | ) | --- | |
| Other
income,
net | 233 | | 233 | | --- | |
| | 3,941 | | 4,506 | | (565 | ) |
| Income
before income taxes and minority
interest | 69,507 | | 72,482 | | (2,975 | ) |
| Income
tax benefit | (5,446 | ) | (2,720 | ) | (2,726 | ) |
| Income
before minority interest | 74,953 | | 75,202 | | (249 | ) |
| Minority
interest, net of tax | 237 | | 242 | | (5 | ) |
| Net
income | $ 75,190 | $ | 75,444 | $ | (254 | ) |
| Basic
earnings per ordinary share and ADS | $ 0.39 | $ | 0.39 | | --- | |
| Diluted
earnings per ordinary share and ADS | $ 0.39 | $ | 0.39 | | --- | |

9

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Balance
Sheets |
| ( Figures
i n T housands
of U . S . D ollars) |

	Dec 3 1 ,
	2006	2006
	As
Corrected	As
Originally Presented
Assets
Current
assets:
Cash
and cash
equivalents	$ 109,753	$	109,753	$	---
Marketable
securities available-for-sale	8,828		8,828		---
Restricted
cash equivalents and marketable securities	108		108		---
Accounts
receivable, less allowance for doubtful
accounts, sales
returns
and discounts	112,363		113,521		(1,158	)
Accounts
receivable from related parties, less allowance for doubtful
accounts, sales
returns
and discounts	117,254		116,096		1,158
Inventories	101,341		101,341		---
Deferred
income taxes	7,362		6,721		641
Prepaid
expenses and other current assets	10,343		10,404		(61	)
Total
current assets	$ 467,352	$	466,772	$	580
Property
and
equipment, net	38,895		41,918		(3,023	)
Deferred
income taxes	1 1,405		11,454		(49	)
Intangible
assets, net	393		393		---
Investments
in
non-marketable securities	817		817		---
Refundable
deposits	550		550		---
	52,060		55,132		(3,072	)
Total
assets	$ 519,412	$	521,904	$	(2,492	)
Liabilities ,
minority interest and
stockholders’ equity
Current
liabilities:
Accounts
payable	$ 120,407	$	120,407	$	---
Income
tax
payable	12,284		14,385		(2,101	)
Other
accrued
expenses and other current liabilities	21,398		21,274		124
Total
current liabilities	$ 154,089	$	156,066	$	(1,977	)
Other
liabilities	---		191		(191	)
Total
liabilities	$ 154,089	$	156,257	$	(2,168	)
Minority
interest	$ 1,396	$	1,397	$	(1	)
Stockholders’
equity:
Ordinary
share, US$0.0001 par value, 500,000,000 shares authorized	19		1 9		---
Additional
paid-in capital	221,666		221,666		---
Accumulated
other comprehensive loss	(275	)	(207	)	(68	)
Unappropriated
earnings	142,517		142,772		(255	)
Total
stockholders’ equity	$ 363,927	$	364,250	$	(323	)
Total
liabilities ,
minority interest and
stockholders’ equity	$ 519,412	$	521,904	$	(2,492	)

10

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Statements of Cash Flows |
| (Figures
in Thousands of U.S.
Dollars) |

| | Three
Months Ended
December 31, 2006 | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | As Corrected | As Originally Presented | | | | |
| Cash
flows from operating activities: | | | | | | |
| Net
income | $ 31,101 | $ | 29,388 | $ | 1,713 | |
| Adjustments
to
reconcile net income to net cash provided by
operating
activities: | | | | | | |
| Depreciation
and amortization | 1,680 | | 1,869 | | (189 | ) |
| Share-based
compensation expenses | 1,493 | | 1,493 | | --- | |
| Minority
interest, net of tax | (178 | ) | (183 | ) | 5 | |
| Gain
on sale
of subsidiary shares and investments in non-marketable securities,
net | (49 | ) | (49 | ) | --- | |
| Gain
on sale
of marketable securities, net | (12 | ) | (12 | ) | --- | |
| Deferred
income taxes | (7,332 | ) | (6,842 | ) | (490 | ) |
| Inventories
write downs | 2,050 | | 2,691 | | (641 | ) |
| Changes
in
operating assets and liabilities: | | | | | | |
| Accounts
receivable | (10,488 | ) | (11,840 | ) | 1,352 | |
| Accounts
receivable from related parties | (45,667 | ) | (44,346 | ) | (1,321 | ) |
| Inventories | 7,527 | | 6,885 | | 642 | |
| Prepaid
expenses and other current assets | 4,125 | | 6,285 | | (2,160 | ) |
| Accounts
payable | 13,578 | | 13,563 | | 15 | |
| Income
tax
payable | 457 | | 2,601 | | (2,144 | ) |
| Other
accrued
expenses and other current liabilities | 3,067 | | 1,327 | | 1,740 | |
| Net
cash provided by operating activities | 1,352 | | 2,830 | | (1,478 | ) |
| Cash
flows from investing activities: | | | | | | |
| Purchase
of
property and equipment | (4,187 | ) | (5,628 | ) | 1,441 | |
| Purchase
of
available-for-sales marketable securities | (12,678 | ) | (12,678 | ) | --- | |
| Sales
and
maturities of available-for-sale marketable securities | 7,940 | | 7,940 | | --- | |
| Cash
acquired
in acquisition | 17 | | --- | | 17 | |
| Proceeds
from
sale of subsidiary shares and investments in non-marketable securities
by
Himax Technologies Limited | 1,537 | | 937 | | 600 | |
| Purchase
of
subsidiary shares from minority interest | (602 | ) | (37 | ) | (565 | ) |
| Refund
from
refundable deposits | 63 | | 62 | | 1 | |
| Pledge
of
restricted cash equivalents and marketable securities | (75 | ) | (74 | ) | (1 | ) |
| Net
cash used in investing activities | (7,985 | ) | (9,478 | ) | 1,493 | |

11

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Statements of Cash Flows |
| (Figures
in Thousands of U.S. Dollars) |

| | Three
Months Ended
December 31, 2006 | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | As
Corrected | As Originally Presented | | | | |
| Cash
flows from financing activities: | | | | | | |
| Proceeds
from
initial public offering, net of issuance costs | (392 | ) | (393 | ) | 1 | |
| Acquisition
of
ordinary shares for retirement | (38,835 | ) | (38,835 | ) | --- | |
| Net
cash used in financing activities | (39,227 | ) | (39,228 | ) | 1 | |
| Effect
of
exchange rate changes on cash and cash equivalents | 19 | | 15 | | 4 | |
| Net
decrease in cash and cash equivalents | (45,841 | ) | (45,861 | ) | 20 | |
| Cash
and cash equivalents at beginning of period | 155,594 | | 155,594 | | --- | |
| Cash
received from the acquisition of subsidiary | --- | | 20 | | (20 | ) |
| Cash
and cash equivalents at end of period | $ 109,753 | $ | 109,753 | | --- | |
| Supplemental
disclosures of cash flow information: | | | | | | |
| Cash
paid
during the period for: | | | | | | |
| Interest | $ --- | $ | --- | $ | --- | |
| Income
taxes | $ 110 | $ | 18 | $ | 92 | |
| Supplemental
disclosures of non-cash investing and financing
activities: | | | | | | |
| Payable
for
purchase of equipment and construction in progress | $ 2,721 | $ | 4,481 | $ | (1,760 | ) |
| Fair
value of
common stocks issued by Himax Display, Inc. in the acquisition
of
Integrated Microdisplays Limited | $ 538 | $ | --- | $ | 538 | |

12

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Statements of Cash Flows |
| (Figures
in Thousands of U.S. Dollars) |

| | Twelve
Months Ended
December 31, 2006 | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | As Corrected | As Originally Presented | | | | |
| Cash
flows from operating activities: | | | | | | |
| Net
income | $ 75,190 | $ | 75,444 | $ | (254 | ) |
| Adjustments
to
reconcile net income to net cash provided by
operating
activities: | | | | | | |
| Depreciation
and amortization | 5,221 | | 5,410 | | (189 | ) |
| Share-based
compensation expenses | 15,150 | | 15,150 | | --- | |
| Impairment
loss on investments in non-marketable securities | 1,500 | | 1,500 | | --- | |
| Loss
on
disposal of property and equipment | 36 | | 36 | | --- | |
| Minority
interest, net of tax | (237 | ) | (242 | ) | 5 | |
| Gain
on sale
of subsidiary shares and investments in non-marketable securities,
net | (137 | ) | (137 | ) | --- | |
| Gain
on sale
of marketable securities, net | (60 | ) | (60 | ) | --- | |
| Deferred
income taxes | (9,556 | ) | (9,066 | ) | (490 | ) |
| Inventories
write downs | 5,165 | | 9,417 | | (4,252 | ) |
| Changes
in
operating assets and liabilities: | | | | | | |
| Accounts
receivable | (31,934 | ) | (33,286 | ) | 1,352 | |
| Accounts
receivable from related parties | (47,566 | ) | (46,245 | ) | (1,321 | ) |
| Inventories | (1,502 | ) | (5,755 | ) | 4,253 | |
| Prepaid
expenses and other current assets | 558 | | 751 | | (193 | ) |
| Accounts
payable | 14,606 | | 14,591 | | 15 | |
| Income
tax
payable | (1,341 | ) | 803 | | (2,144 | ) |
| Other
accrued
expenses and other current liabilities | 4,603 | | 2,863 | | 1,740 | |
| Net
cash provided by operating activities | 29,696 | | 31,174 | | (1,478 | ) |
| Cash
flows from investing activities: | | | | | | |
| Purchase
of
property and equipment | (17,829 | ) | (19,270 | ) | 1,441 | |
| Purchase
of
available-for-sales marketable securities | (31,911 | ) | (31,911 | ) | --- | |
| Sales
and
maturities of available-for-sale marketable securities | 27,128 | | 27,128 | | --- | |
| Purchase
of
investment in non-marketable securities | (817 | ) | (1,410 | ) | 593 | |
| Cash
acquired
in acquisition | 17 | | --- | | 17 | |
| Proceeds
from
sale of subsidiary shares and investments in non-marketable securities
by
Himax Technologies Limited | 1,142 | | 1,143 | | (1 | ) |
| Purchase
of
subsidiary shares from minority interest | (773 | ) | (208 | ) | (565 | ) |
| Refund
from
refundable deposits | 171 | | 170 | | 1 | |
| Release
of
restricted cash equivalents and marketable securities | 13,945 | | 13,946 | | (1 | ) |
| Net
cash used in investing activities | (8,927 | ) | (10,412 | ) | 1,485 | |

13

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Condensed Consolidated Statements of Cash Flows |
| (Figures
in Thousands of U.S. Dollars) |

| | Twelve
Months Ended
December 31, 2006 | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | As Corrected | As Originally
Presented | | | | |
| Cash
flows from financing activities: | | | | | | |
| Proceeds
from
initial public offering, net of issuance costs | 147,408 | | 147,407 | | 1 | |
| Proceeds
from
issuance of new shares by subsidiaries | 676 | | 668 | | 8 | |
| Acquisition
of
ordinary shares for retirement | (38,835 | ) | (38,835 | ) | --- | |
| Proceeds
from
borrowing of short-term debt | 11,303 | | 11,303 | | --- | |
| Repayment
of
short-term debt | (38,577 | ) | (38,577 | ) | --- | |
| Repayment
of
long-term debt | (89 | ) | (89 | ) | --- | |
| Net
cash provided by financing activities | 81,886 | | 81,877 | | 9 | |
| Effect
of
exchange rate changes on cash and cash equivalents | 12 | | 8 | | 4 | |
| Net
Increase in cash and cash equivalents | 102,667 | | 102,647 | | 20 | |
| Cash
and cash equivalents at beginning of year | 7,086 | | 7,086 | | --- | |
| Cash
received from the acquisition of subsidiary | | | 20 | | (20 | ) |
| Cash
and cash equivalents at end of year | $ 109,753 | $ | 109,753 | | --- | |
| Supplemental
disclosures of cash flow information: | | | | | | |
| Cash
paid
during the year for: | | | | | | |
| Interest | $ 311 | $ | 311 | $ | --- | |
| Income
taxes | $ 5,695 | $ | 5,603 | $ | 92 | |
| Supplemental
disclosures of non-cash investing and financing
activities: | | | | | | |
| Payable
for
purchase of equipment and construction in progress | $ 1,846 | $ | 3,606 | $ | (1,760 | ) |
| Fair
value of
common stocks issued by Himax Display,
Inc.
in the acquisition of Integrated Microdisplays
Limited | $ 538 | $ | --- | $ | 538 | |

14

| Himax
Technologies, Inc. |
| --- |
| Unaudited
Supplemental Data - Reconciliation Schedule |
| (Figures
in Thousands of U.S. Dollars, Except Per Share
Data) |
| Gross
Margin and Operating Margin Excluding Share-based
Compensation: |

| | Three
Months Ended
December 31, 2006 — As Corrected | As Originally
Presented | Changes
to the Originally Presented | |
| --- | --- | --- | --- | --- |
| Revenues | $ 220,879 | $ 220,879 | $ --- | |
| Gross
profit | 41,665 | 41,665 | --- | |
| Add:
Share-based compensation – Cost of
revenues | 25 | 25 | --- | |
| Gross
profit
excluding share-based compensation | 41,690 | 41,690 | --- | |
| Gross
margin
excluding share-based compensation | 18.9 % | 18.9 % | --- | |
| Operating
income | 22,322 | 22,765 | ( 443 | ) |
| Add:
Share-based compensation | 1 ,493 | 1,493 | --- | |
| Operating
income excluding share-based compensation | 23,815 | 24,258 | (443 | ) |
| Operating
margin excluding share-based compensation | 10.8 % | 11.0 % | (0.2 | %) |
| Gross
margin
excluding share-based compensation equals gross profit excluding
share-based compensation divided by revenues | | | | |
| Operating
margin excluding share-based compensation equals operating income
excluding share-based compensation divided by
revenues | | | | |

| Diluted
Earnings Per Share Excluding Share-Based Compensation and Acquisition
Related Cost: | Three
Months Ended
December 31, 2006 | | Changes
to the Originally Presented |
| --- | --- | --- | --- |
| | As
Corrected | As
Originally Presented | |
| Diluted
GAAP
EPS | $ 0.16 | $ 0.15 | $ 0.01 |
| Add:
Estimated
share-based compensation per diluted share | 0.01 | 0.01 | --- |
| Diluted
non
GAAP EPS excluding share-based compensation | $ 0.16 | $ 0.16 | $ --- |
| Numbers
do not
add up to rounding | | | |

15