Pixelplus Reports Financial Results for Fiscal Second Quarter 2008

SEOUL, South Korea , July 31 /PRNewswire-FirstCall/ -- Pixelplus Co., Ltd. (Nasdaq: PXPL), a fabless semiconductor company in Korea that designs, develops, and markets CMOS image sensors for various consumer electronics applications, today...


SEOUL, South Korea , July 31 /PRNewswire-FirstCall/ -- Pixelplus Co., Ltd. (Nasdaq: PXPL), a fabless semiconductor company in Korea that designs, develops, and markets CMOS image sensors for various consumer electronics applications, today announced unaudited financial results for the second quarter of fiscal 2008, which ended on June 30, 2008 .

Revenue for the second quarter of fiscal 2008 was US$3.6 million, compared to US$3.2 million in the first quarter of fiscal 2008, and US$5.4 million in the second quarter of fiscal 2007. The Company's revenue in the second quarter of 2008 is consistent with the guidance the Company provided during its fourth quarter 2007 and first quarter 2008 earnings call held on June 16, 2008 .

Net loss in the second quarter of fiscal 2008 was US$2.7 million, or a net loss of US$0.78 per diluted ADS, compared to a net loss of US$2.3 million, or a net loss of US$0.17 per diluted ADS, in the first quarter of fiscal 2008, and a net loss of US$1.6 million, or a net loss of US$0.13 per diluted ADS, in the second quarter of fiscal 2007.

Revenue for the first six months of fiscal 2008 was US$6.9 million, compared to US$9.3 million for the same period in fiscal 2007. Net loss for the first six months of fiscal 2008 was US$5.0 million, or a net loss of US$1.47 per diluted share, compared to a net loss of US$2.6 million, or a net loss of US$0.20 per diluted share, for the same period in fiscal 2007.

The Company's net loss of US$0.78 per diluted ADS in the second quarter of fiscal 2008 and net loss of US$1.47 per diluted share in the first six months of fiscal 2008 were calculated based on Pixelplus' one-for-four reverse stock split of its American Depositary Receipts effective as of the open of business on April 14, 2008 . In this regard, had the Company not completed this reverse stock split, it would have sustained a net loss of about US$0.19 per diluted ADS in the second quarter of fiscal 2008 and a net loss of roughly US$0.36 per diluted share in the first six months of fiscal 2008.

The Company sold approximately 7.1 million image sensors in the second quarter of fiscal 2008, which represents an increase of about 2.8 million units from its sale of around 4.3 million units in the first quarter of fiscal 2008. Separately, the Company provided approximately 1.1 million image sensors arising from its supply of services to a leading Japanese module maker in the second quarter of fiscal 2008, which is almost the same as its supply of around 1.1 million units in the first quarter of fiscal 2008. So, in terms of combined figures, the Company sold and supplied a total of about 8.2 million image sensors in the second quarter of fiscal 2008, which represents an increase of roughly 2.8 million units from its sale and supply of around 5.4 million units in the first quarter of fiscal 2008.

Gross margin for the second quarter of fiscal 2008 was 4.9%, compared to 11.5% in the first quarter of fiscal 2008. The Company's lower-than-expected gross margin was due to its greater-than-anticipated decrease in the total number of VGA image sensors sold in the second quarter of 2008, and also was due to its greater-than-expected decrease in the average selling price of its image sensors sold in the second quarter of 2008. To improve gross margin in the second half of 2008, the Company expects to enhance production yields for its PlusPixel2(TM) products with its foundry partner in Taiwan , and also fortify its revenues arising from the steadily increasing supply of its PO4010 CIF 'System-on-a-Chip' ("SoC"), PO6030 VGA SoC, and PC1030 NTSC/PAL image sensors.

The Company's SG&A expenses in the second quarter of fiscal 2008 were about US$1.7 million, compared to roughly US$1.8 million in the first quarter of fiscal 2008, and approximately US$2.7 million in the second quarter of fiscal 2007. Moreover, the Company's operating expenses in the second quarter of fiscal 2008 were around US$2.8 million, compared to about US$2.9 million in the first quarter of fiscal 2008, and approximately US$3.7 million in the second quarter of fiscal 2007.

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