Actionable news
0
All posts from Actionable news
Actionable news in GIGM: GigaMedia Limited,

Gigamedia Announces Third-Quarter 2015 Financial Results

The following excerpt is from the company's SEC filing.

TAIPEI, Taiwan, November 4, 2015 GigaMedia Limited (NASDAQ: GIGM) today announced its third-quarter 2015 unaudited financial results.

Message from Management

For the third quarter of 2015, the sales revenues were $2.0 million. The contribution made by the mobile games, the social casino games and the cloud computing business accounted for about 52.4%, 30.4% and 17.2% respectively.

In the third quarter, the Company streamlined the mobile gaming business. The Company reviewed all the existing games, halted the ones with weak monetization and repackaged the ones considered better monetizatio n for re-launch. It is expected to see its margin improve by the end of this year.

In addition to the social casino games platform, it has started to hold the online qualifying tournaments of the World Series of Mahjong 2015. It is also a good opportunity to testify the quality and loading capacity of this in-house developed platform.

With regard to cloud computing business, for the nine months of 2015 compared with the same period of 2014, the business grew by approximately 128% and the gross loss narrowed. For the third quarter of 2015 compared with the previous quarter, although the business went down, the Company believes that the cloud computing business will outperform its last year performance.

Last but not least, due to the recent slowdown of global economy and stock market, management decided to terminate the acquisition of Strawberry Cosmetics. In consequence of the termination of the acquisition, the Company had to pay $2.0 million consideration to Strawberry Cosmetics as stated in the announcement dated October 7

, 2015 and the $2.0 million payment will impact its 4Q 2015 financial results.

Before the market rebounds, management will remain conservative in investment. At the present stage, management will make more effort to streamline the current operations, continue to maintain a healthy financial structure and meanwhile, look for other potential investment opportunities in Asia.

Consolidated Financial Results

GigaMedia Limited is a diversified provider of online games and cloud computing services. GigaMedias online games business FunTown develops and operates a suite of games in Taiwan and Hong Kong, with focus on browser/mobile games and social casino games. GigaMedias cloud computing business GigaCloud was launched in early April 2013 and is focused on providing small and medium-sized enterprises in Greater China with critical communications services and IT solutions that increase flexibility, efficiency and competitiveness.

Unaudited consolidated results of GigaMedia are summarized in the table below.

GIGAMEDIA 3Q15 UNAUDITED CONSOLIDATED FINANCIAL RESULTS

(unaudited, all figures in US$ thousands, except per share amounts)

Change

Revenues

Gross Profit/ Loss

-375.6

-391.7

Loss from Operations

-5,240

-3,801

-3,631

-12,457

-9,143

Net Income/ Loss Attributable to GigaMedia

-121.9

-4,839

-10,592

Net Income/ Loss Per Share Attributable to GigaMedia, Diluted

-150.0

EBITDA

-114.1

-4,589

-9,844

Cash and Marketable Securities-Current

74,824

68,305

56,940

EBITDA (earnings before interest, taxes, depreciation, and amortization) is provided as a supplement to results provided in accordance with U.S. generally accepted accounting principles (GAAP). (See, Use of Non-GAAP Measures, for more details.)

Financial Highlights

9M2015

Operating revenues

reached to $7.9 million, a 10.9% increase compared with the same period of 2014 attributable to the growth of cloud computing business.

Operating expenses

increased resulting from an increase of selling and marketing expenses for more mobile games launched, particularly in the first half of 2015.

Net income

was $6.3 million primarily due to the capital gain on disposal of marketable securities.

3Q2015

Consolidated revenues

were $ 2.0 million, dropped by 26.5% quarter-on-quarter and 18.9% quarter-over-quarter respectively mainly due to a decline of the overall business.

Gross profit

reported a loss of $0.6 million primarily resulting from the expenses associated with licensing fees and outsource.

Consolidated operating expenses

were $4.6 million in 3Q15, up by 15.0% quarter-on-quarter and 21.0% quarter-over-quarter mainly due to an increase on general and administrative expenses, including the expenses related to Strawberry Cosmetics Acquisition Proposal.

Consolidated non-operating income

was $5.0 million, slightly decreased by 2.8% due to investment loss recognized under equity method and foreign exchange loss.

Net loss

was $0.3 million mainly due...


More