Parade Technologies Reports Third Quarter 2023 Financial Results

Financial Highlights:

  • Q323 consolidated revenue US$116.96 million, compared with US$151.04 million in the year-ago quarter
  • Q323 consolidated net income US$19.32 million; Basic and Fully diluted after-tax EPS US$0.24 (NT$7.71) and US$0.24 (NT$7.68), respectively

Parade Technologies, Ltd. (Taipei Exchange: 4966.TWO), a leading high-speed interface IC supplier, today announced financial results for the third quarter fiscal year 2023 ended September 30, 2023, and provided guidance for the fourth quarter of fiscal year 2023.

Consolidated revenue was US$116.96 million and consolidated net income was US$19.32 million. Basic and fully diluted after-tax earnings per share (“EPS”) were US$0.24 (NT$7.71) and US$0.24 (NT$7.68), respectively. These results compared to consolidated revenue US$151.04 million and consolidated net income of US$32.64 million, or US$0.41 (NT$12.38) and US$0.40 (NT$12.21) per basic and fully diluted share, in the year-ago quarter.

In US dollars, the third quarter of 2023 consolidated revenue increased 12.27% sequentially and was down 22.57% year-over-year.

The gross profit in the third quarter of 2023 was US$51.17 million, representing an increase of 11.74% from the previous quarter and a decrease of 25.15% compared to the same quarter of last year.

On August 30, 2023, Parade announced the availability of the PS8580/ PS8580V/ PS8581 PCIe5 32Gbps linear redriver/2×2 cross switch family. PS8580 and PS8580V integrate a quad-channel unidirectional linear redriver with a 2×2 cross switch while PS8581 features a linear redriver only. PS8580/PS8581 are designed for notebook/desktop PC, server/datacenter and industrial applications while PS8580V supports automotive AEC-Q100 grade 2 requirements. Multiple PS858x devices support x4, x8 or x16 bidirectional link. PS858x family is compliant with PCIe5 specification.

On October 18, 2023, Parade announced the availability of its new high-resolution, automotive-grade PS8627V DisplayPort™ to LVDS protocol converter. The PS8627V is used to convert a DisplayPort™ (DP) or eDP™ (Embedded DisplayPort) video transport stream to the LVDS (Low-Voltage Differential Signaling) interface used by automotive-grade display panels or display assemblies. The PS8627V enables ultrawide display up to 7680×1260@60Hz with 30bpp color depth. The PS8627V features a DP/eDP input of up to 4 lanes and LVDS output of up to 6 ports. Enabling a native DP/eDP connection between an automotive Video Control Unit (VCU) and display assembly can simplify system design and lower implementation cost by eliminating the need for a SERDES (serializer-deserializer) for the audio/video transport channel.

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

  • Revenue: US$110.0 ~122.0 Million
  • Gross Margin: 43% ~47%
  • Operating Expense: US$30.0 ~33.0 Million

The financial figures detailed above for the third quarter of 2023 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 INCOME STATEMENTS

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,

2023

2023

2023

2022

2023

2022

2023

2023

2023

2022

2023

2022

 
Revenue

116,959

104,178

116,959

151,044

321,127

578,466

3,705,248

3,199,298

3,705,248

4,591,744

9,944,258

16,873,838

Cost of goods sold

65,785

58,380

65,785

82,671

180,112

306,959

2,084,065

1,792,845

2,084,065

2,513,211

5,577,707

8,959,119

Gross profit

51,174

45,798

51,174

68,373

141,015

271,507

1,621,183

1,406,453

1,621,183

2,078,533

4,366,551

7,914,719

Research & development expenses

21,911

20,293

21,911

21,090

62,096

63,799

694,131

623,198

694,131

641,148

1,922,046

1,868,145

Sales & marketing expenses

6,647

7,188

6,647

7,285

21,033

23,406

210,593

220,732

210,593

221,477

650,147

684,313

General & administrative expenses

4,268

4,888

4,268

5,327

14,149

18,325

135,108

150,109

135,108

161,917

437,014

535,367

Expected credit loss

84

-

84

-

-

-

2,549

-

2,549

-

-

-

Total operating expenses

32,742

32,369

32,742

33,702

97,278

105,530

1,037,283

994,039

1,037,283

1,024,542

3,009,207

3,087,825

Operating income

18,432

13,429

18,432

34,671

43,737

165,977

583,900

412,414

583,900

1,053,991

1,357,344

4,826,894

Non-operating income and (expenses)

2,386

2,055

2,386

1,185

5,709

1,721

75,605

63,081

75,605

36,031

177,246

51,868

Income before income taxes

20,818

15,484

20,818

35,856

49,446

167,698

659,505

475,495

659,505

1,090,022

1,534,590

4,878,762

Income tax expense

1,502

1,505

1,502

3,216

4,530

14,934

47,577

46,226

47,577

97,771

140,102

434,653

Net income

19,316

13,979

19,316

32,640

44,916

152,764

611,928

429,269

611,928

992,251

1,394,488

4,444,109

EPS - Basic (In Dollar)

$0.24

$0.18

$0.24

$0.41

$0.57

$1.92

$7.71

$5.44

$7.71

$12.38

$17.68

$55.74

Shares used in computing EPS-Basic (In thousands)

79,318

78,947

79,318

80,181

78,888

79,732

79,318

78,947

79,318

80,181

78,888

79,732

EPS - Diluted (In Dollar)

$0.24

$0.18

$0.24

$0.40

$0.56

$1.88

$7.68

$5.40

$7.68

$12.21

$17.53

$54.69

Shares used in computing EPS-Diluted (In thousands)

79,639

79,545

79,639

81,272

79,530

81,257

79,639

79,545

79,639

81,272

79,530

81,257

 
UNAUDITED CONSOLIDATED BALANCE SHEETS

As of SEPTEMBER 30, 2023 and 2022
USD in Thousands NTD in Thousands
Sep 30, Sep 30, Sep 30, Sep 30,

2023

2022

2023

2022

Current assets
Cash & cash equivalents

240,124

294,933

7,748,801

9,364,118

Accounts receivable, net

54,839

53,497

1,769,655

1,698,539

Inventories, net

117,406

134,277

3,788,694

4,263,286

Other current assets

23,297

22,471

751,801

713,475

Total current assets

435,666

505,178

14,058,951

16,039,418

Non-current assets
Property, plant and equipment, net

13,808

17,033

445,570

540,799

Right-of-use assets

4,613

6,188

148,874

196,468

Intangible assets

99,687

104,853

3,216,902

3,329,058

Deferred income tax assets

11,840

10,686

382,067

339,269

Other non-current assets

156,074

152,838

5,036,493

4,852,598

Total non-current assets

286,022

291,598

9,229,906

9,258,192

Total Assets

721,688

796,776

23,288,857

25,297,610

 
Current Liabilities
Accounts payable

48,663

34,659

1,570,357

1,100,435

Other payables

26,003

36,724

839,104

1,165,986

Current income tax liabilities

10,494

33,537

338,644

1,064,782

Lease liabilities - current

3,038

2,865

98,046

90,960

Other current liabilities

4,383

21,004

141,448

666,878

Total current liabilities

92,581

128,789

2,987,599

4,089,041

Non-current Liabilities
Lease liabilities - non-current

1,575

3,323

50,828

105,508

Total non-current liabilities

1,575

3,323

50,828

105,508

Equity
Ordinary shares

26,731

26,742

811,641

811,962

Capital reserves

135,591

137,941

4,232,535

4,186,139

Retained earnings

519,088

538,566

15,353,693

15,941,317

Other equity

(9,217)

(16,777)

1,246,010

769,771

Treasury shares

(44,661)

(21,808)

(1,393,449)

(606,128)

Total equity

627,532

664,664

20,250,430

21,103,061

Total liabilities and equity

721,688

796,776

23,288,857

25,297,610

 
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023 and 2022
USD in Thousands NTD in Thousands
Sep 30, Sep 30, Sep 30, Sep 30,

2023

2022

2023

2022

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

49,445

167,698

1,534,590

4,878,762

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

16,495

16,549

510,197

484,542

Loss on disposal of equipment

-

1

-

35

Loss on disposal of intangible assets

263

-

8,134

-

Share-based compensation cost

25,390

24,725

776,250

728,543

Interest income

(4,851)

(819)

(150,377)

(24,720)

Income and expenses having no effect on cash flows

37,297

40,456

1,144,204

1,188,400

Accounts receivable

(20,132)

(3,114)

(649,649)

(98,886)

Inventories

28,087

(58,498)

906,362

(1,857,313)

Other current assets

(24,147)

(34,338)

(634,589)

(993,127)

Net changes in assets relating to operating activities

(16,192)

(95,950)

(377,876)

(2,949,326)

Accounts payable

35,661

(6,187)

1,150,765

(196,425)

Other payables

(14,560)

(12,816)

(469,850)

(406,910)

Other current liabilities

(9,091)

10,960

(293,354)

347,992

Net changes in liabilities relating to operating activities

12,010

(8,043)

387,561

(255,343)

Cash inflow generated from operations

82,560

104,161

2,688,479

2,862,493

Interest received

4,851

819

150,377

24,720

Income taxes paid

(6,822)

(1,313)

(211,015)

(38,444)

Income taxes received

-

19

-

565

Net cash provided by operating activities

80,589

103,686

2,627,841

2,849,334

Cash flows from investing activities
Acquisition of equipment

(3,621)

(5,042)

(111,985)

(147,620)

Acquisition of intangible assets

(216)

(61)

(6,689)

(1,797)

Decrease (increase) in refundable deposits

7,662

(72,066)

247,251

(2,288,095)

Increase in other prepayments

(13,719)

(8,777)

(424,340)

(256,987)

Net cash flows used in investing activities

(9,894)

(85,946)

(295,763)

(2,694,499)

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

-

2,448

-

71,665

Repayment of the principal portion of lease liabilities

(2,492)

(2,651)

(77,091)

(77,636)

Treasury shares reissued to employees

25,424

34,533

760,161

959,141

Distribution of cash dividends

(83,624)

(93,720)

(2,439,014)

(2,622,127)

Cash dividend regain from canceled share-based compensation

128

63

3,787

1,870

Net cash flows used in financing activities

(60,564)

(59,327)

(1,752,157)

(1,667,087)

Effect of exchange rate changes

2,856

4,087

193,496

1,674,627

Net increase (decrease) in cash and cash equivalents

12,987

(37,500)

773,417

162,375

Cash and cash equivalents at beginning of period

227,137

332,433

6,975,384

9,201,743

Cash and cash equivalents at end of period

240,124

294,933

7,748,801

9,364,118

 

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