Included in fourth quarter 2013 GAAP and non-GAAP adjusted net income was approximately $2.3 million, net of tax, non-cash share-based compensation expense. Excluding share based compensation expense, both GAAP and non-GAAP adjusted diluted EPS would have increased by an additional $0.05 per diluted share, the same amount per diluted share by which share-based compensation affected GAAP and non-GAAP adjusted net income in the third quarter 2013 and the fourth quarter 2012.
EBITDA, which represents earnings before net interest expense, income tax, depreciation and amortization, for the fourth quarter 2013 was $28.8 million, compared to $36.7 million for the third quarter 2013 and $24.1 million for the fourth quarter 2012. For a reconciliation of GAAP net income to EBITDA (non-GAAP), see the table near the end of the release for further details.
For the fourth quarter 2013, net cash provided by operating activities was $32.1 million. Net cash flow was ($7.6) million, mainly due to the pay down of $20 million on our long-term debt. Free cash flow was $15.8 million, which included $16.3 million of capital expenditures and a reduction in inventory by approximately $13.9 million.
Balance Sheet
As of December 31, 2013, the Company had approximately $197 million in cash and cash equivalents and approximately $23 million in short-term investments. Working capital was approximately $493 million.
Business Outlook
Dr. Lu concluded, “For the first quarter of 2014, we expect revenue to range between $205 million and $213 million, or plus 1 percent to minus 3 percent sequentially. We expect gross margin to be flat with fourth quarter at 28.8 percent, plus or minus 2 percent. Operating expenses are expected to be flat with the fourth quarter, excluding impairment of goodwill, at approximately 22.5 percent of revenue, plus or minus 1 percent. We expect our income tax rate to range between 19 and 25 percent, and shares used to calculate EPS for the first quarter are anticipated to be approximately 48.2 million.”
Conference Call
Diodes will host a conference call on Tuesday, February 11, 2014 at 4:00 p.m. Central Time (5:00 p.m. Eastern Time) to discuss its fourth quarter and fiscal year financial results. Investors and analysts may join the conference call by dialing 1-855-232-8957 and providing the confirmation code 31466328. International callers may join the teleconference by dialing 1-315-625-6979 and enter the same confirmation code at the prompt. A telephone replay of the call will be made available approximately two hours after the call and will remain available until Tuesday, February 18, 2014 at midnight Central Time. The replay number is 1-855-859-2056 with a pass code of 31466328. International callers should dial 1-404-537-3406 and enter the same pass code at the prompt. Additionally, this conference call will be broadcast live over the Internet and can be accessed by all interested parties on the Investors section of Diodes' website at http://www.diodes.com. To listen to the live call, please go to the Investors section of Diodes’ website and click on the conference call link at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those unable to participate during the live broadcast, a replay will be available shortly after the call on Diodes' website for approximately 60 days.
About Diodes Incorporated
Diodes Incorporated (Nasdaq: DIOD), a Standard and Poor's SmallCap 600 and Russell 3000 Index company, is a leading global manufacturer and supplier of high-quality application specific standard products within the broad discrete, logic and analog semiconductor markets. Diodes serves the consumer electronics, computing, communications, industrial, and automotive markets. Diodes' products include diodes, rectifiers, transistors, MOSFETs, protection devices, functional specific arrays, single gate logic, amplifiers and comparators, Hall-effect and temperature sensors; power management devices, including LED drivers, AC-DC converters and controllers, DC-DC switching and linear voltage regulators, and voltage references along with special function devices, such as USB power switches, load switches, voltage supervisors, and motor controllers. Diodes’ corporate headquarters, logistics center, and Americas' sales office are located in Plano, Texas. Design, marketing, and engineering centers are located in Plano; San Jose, California; Taipei, Taiwan; Manchester, England; and Neuhaus, Germany. Diodes’ wafer fabrication facilities are located in Kansas City, Missouri and Manchester, with four manufacturing facilities located in Shanghai, China, and two joint venture facilities located in Chengdu, China, as well as manufacturing facilities located in Neuhaus and Taipei. Additional engineering, sales, warehouse, and logistics offices are located in Fort Worth, Texas; Taipei; Hong Kong; Manchester; Shanghai; Shenzhen, China; Seongnam-si, South Korea; Suwon, South Korea; Tokyo, Japan; and Munich, Germany, with support offices throughout the world. For further information, including SEC filings, visit Diodes’ website at http://www.diodes.com.
Safe Harbor Statement Under the Private Securities Litigation Reform
Act of 1995: Any statements set forth above that are not historical
facts are forward-looking statements that involve risks and
uncertainties that could cause actual results to differ materially from
those in the forward-looking statements. Such statements include
statements regarding our expectation that: the integration has been
progressing well, and we still have additional cost savings to realize
in the coming year as well as increased cross-selling opportunities as
design wins ramp throughout the year; moving forward we expect to
capture further synergies over time as we improve loading of the
manufacturing facilities and transfer more products internally to
maximize operational and cost efficiencies; despite the prolonged
weakness in this market, we have been able to gain market share across
our business due to our past design win momentum and new product
initiatives; looking forward, we remain focused on achieving our goal of
$1 billion in annual revenue with model profitability, and the BCD
acquisition has brought us one step closer toward achieving this goal;
for the first quarter of 2014, we expect revenue to range between $205
million and $213 million, or plus 1 percent to minus 3 percent
sequentially; we expect gross margin to be flat with fourth quarter at
28.8 percent, plus or minus 2 percent; operating expenses are expected
to be flat with the fourth quarter, excluding impairment of goodwill, at
approximately 22.5 percent of revenue, plus or minus 1 percent; and we
expect our income tax rate to range between 19 and 25 percent, and
shares used to calculate EPS for the first quarter are anticipated to be
approximately 48.2 million. Potential risks and uncertainties
include, but are not limited to, such factors as: the risk that BCD’s
business will not be integrated successfully into Diodes’; the risk that
the expected benefits of the acquisition may not be realized; the risk
that BCD’s standards, procedures and controls will not be brought into
conformance within Diodes’ operations; difficulties coordinating Diodes’
and BCD’s new product and process development, hiring additional
management and other critical personnel, and increasing the scope,
geographic diversity and complexity of Diodes’ operations; difficulties
in consolidating facilities and transferring processes and know-how; the
diversion of our management’s attention from the management of our
business; the risk that we may not be able to maintain our current
growth strategy or continue to maintain our current performance, costs
and loadings in our manufacturing facilities; risks of domestic and
foreign operations, including excessive operation costs, labor
shortages, higher tax rates and our joint venture prospects; the risk of
unfavorable currency exchange rates; our future guidance may be
incorrect; the global economic weakness may be more severe or last
longer than we currently anticipated; and other information detailed
from time to time in Diodes’ filings with the United States Securities
and Exchange Commission.
