O2Micro International Limited revenue increased on 4.2% while EBITDA Margin decreased on 2.7 pp from -7.6% to -10.3%
01/30/2019 • About O2Micro International Limited (
$OIIM) • By InTwits
O2Micro International Limited reported 2018 financial results today. Here are the key drivers of the company's long term financial model:
- The company operates at negative EBITDA Margin: -10.3%
- O2Micro International Limited spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2014-2018 is 0.0%. Average EBITDA Margin for the same period was -12.5%
- O2Micro International Limited has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.5%. At the same time it's a lot of higher than industry average of 6.1%.
- CAPEX is quite volatile: $1m in FY2018, $0m in FY2017, $1m in FY2016, $0m in FY2015, $0m in FY2014
- The company has unprofitable business model: ROIC is -10.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
O2Micro International Limited's Revenue increased on 4.2%. Revenue growth showed acceleration in 18Q4 - it increased 9.0% YoY. Revenue decline was slowing down on average by 5.6 pp per annum in the last 5 years. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 11.3 pp from -10.2% to 1.1% in 2018.
Gross Margin showed almost no change in 2018. SG&A as a % of Revenue increased slightly on 0.78 pp from 31.6% to 32.4% in 2018.
Net Income margin jumped on 13.5 pp from -10.2% to 3.3% in 2018.
Investments (CAPEX, working capital and M&A)
In 2018 O2Micro International Limited had CAPEX/Revenue of 2.0%. The company's CAPEX/Revenue increased slightly on 0.71 pp from 1.3% in 2015 to 2.0% in 2018. It's average level of CAPEX/Revenue for the last three years was 1.5%. During 2014-2018 CAPEX as a % of Revenue bottomed in 2017 at 1.2%.
Return on investment
The company operates at negative ROIC (-10.4%) and low but positive ROE (2.7%). ROIC decreased on 2.5 pp from -7.9% to -10.4% in 2018. ROE surged on 10.5 pp from -7.8% to 2.7% in 2018.
Leverage (Debt)
The company has no debt. Cash surged on 13.7%.
Financial and operational results
FY ended 12/31/2018
O2Micro International Limited ($OIIM) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 63.591 | 54.841 | 56.561 | 60.205 | 62.714 | 4.2% |
| Gross Profit | 32.735 | 27.696 | 29.244 | 30.779 | 31.973 | 3.9% |
| SG&A | 24.721 | 23.632 | 19.481 | 19.047 | 20.332 | 6.7% |
| EBITDA | -10.153 | -11.983 | -4.177 | -4.571 | -6.484 | |
| Net Income | -15.057 | -21.095 | -2.986 | -6.145 | 2.088 | |
Balance Sheet
|
|---|
| Cash | 41.069 | 41.199 | 31.332 | 28.520 | 32.414 | 13.7% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 1.004 | 0.724 | 0.673 | 0.704 | 1.272 | 80.7% |
Ratios
|
|---|
| Revenue growth | -13.8% | -13.8% | 3.1% | 6.4% | 4.2% | |
| EBITDA growth | | 18.0% | -65.1% | 9.4% | 41.9% | |
|
|---|
| Gross Margin | 51.5% | 50.5% | 51.7% | 51.1% | 51.0% | -0.1% |
| EBITDA Margin | -16.0% | -21.9% | -7.4% | -7.6% | -10.3% | -2.7% |
| SG&A, % of revenue | 38.9% | 43.1% | 34.4% | 31.6% | 32.4% | 0.8% |
| Net Income Margin | -23.7% | -38.5% | -5.3% | -10.2% | 3.3% | 13.5% |
| CAPEX, % of revenue | 1.6% | 1.3% | 1.2% | 1.2% | 2.0% | 0.9% |
|
|---|
| ROIC | -11.8% | -14.9% | -7.0% | -7.9% | -10.4% | -2.5% |
| ROE | -12.9% | -22.2% | -3.6% | -7.8% | 2.7% | 10.5% |
O2Micro International Limited ($OIIM) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 14 | 15 | 17 | 17 | | -5.7% | 4.8% | 8.3% | 9.0% |
| Net Income | 7 | 1 | -3 | -3 | | | | | |
Balance Sheet
|
|---|
| Cash | 25 | 24 | 34 | 32 | | -7.1% | -18.3% | 34.5% | 13.7% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 51.2% | 52.1% | 50.5% | 50.3% | | -1.6% | 1.2% | 0.2% | -0.2% |
| Net Income Margin | 50.8% | 9.6% | -20.5% | -18.6% | | 60.6% | 19.5% | -11.7% | -6.3% |
Peers in Semiconductors
Below you can find O2Micro International Limited benchmarking vs. other companies in Semiconductors industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| NanoFlex Power Corp ($OPVS) | | | | 72.5% | 354.8% |
| MoSys, Inc. ($MOSY) | | -18.4% | 37.2% | 46.8% | 87.7% |
| SMART Global Holdings, Inc. ($SGH) | | | -16.9% | 42.5% | 69.3% |
| Micron Technology, Inc. ($MU) | | -1.0% | -23.4% | 63.9% | 49.5% |
| Adesto Technologies Corporation ($IOTS) | | 4.3% | 1.6% | 27.6% | 48.8% |
| |
|---|
| Median (67 companies) | 54.6% | 9.7% | 5.2% | 11.0% | 5.0% |
|---|
| O2Micro International Limited ($OIIM) | | -13.8% | 3.1% | 6.4% | 4.2% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| CEVA, Inc. ($CEVA) | 90.2% | 90.9% | 91.6% | 92.1% | 89.8% |
| NVE Corporation ($NVEC) | 77.9% | 80.3% | 76.1% | 78.5% | 79.0% |
| Rambus, Inc. ($RMBS) | 85.9% | 84.7% | 80.1% | 79.9% | 76.8% |
| Universal Display Corporation ($OLED) | 76.0% | 64.2% | 83.9% | 80.8% | 75.5% |
| Intermolecular, Inc. ($IMI) | 48.3% | 57.4% | 66.5% | 67.5% | 70.3% |
| |
|---|
| Median (65 companies) | 45.3% | 47.0% | 47.2% | 48.6% | 50.4% |
|---|
| O2Micro International Limited ($OIIM) | 51.5% | 50.5% | 51.7% | 51.1% | 51.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| NVE Corporation ($NVEC) | 58.8% | 66.0% | 61.8% | 65.6% | 65.1% |
| Micron Technology, Inc. ($MU) | 31.7% | 35.0% | 25.4% | 47.9% | 65.0% |
| NXP Semiconductors N.V. ($NXPI) | 25.7% | 41.5% | 21.6% | 46.2% | 49.9% |
| Texas Instruments Incorporated ($TXN) | 39.7% | 42.0% | 43.5% | 46.7% | 48.6% |
| Intel Corp ($INTC) | 42.8% | 41.0% | 35.2% | 41.7% | 45.7% |
| |
|---|
| Median (66 companies) | 9.9% | 11.5% | 9.2% | 10.7% | 10.0% |
|---|
| O2Micro International Limited ($OIIM) | -16.0% | -21.9% | -7.4% | -7.6% | -10.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Alpha and Omega Semiconductor Limited ($AOSL) | 3.0% | 6.6% | 6.5% | 12.2% | 42.2% |
| Renesola Ltd. ($SOL) | 3.5% | 0.0% | 0.0% | 78.0% | 41.7% |
| First Solar, Inc. ($FSLR) | 7.6% | 4.0% | 7.9% | 17.5% | 33.0% |
| Sigma Designs Inc ($SIGM) | 11.0% | 6.5% | 6.2% | 14.1% | 29.3% |
| Micron Technology, Inc. ($MU) | 19.0% | 24.8% | 46.9% | 23.3% | 29.2% |
| |
|---|
| Median (66 companies) | 3.6% | 4.0% | 3.7% | 4.7% | 4.6% |
|---|
| O2Micro International Limited ($OIIM) | 1.6% | 1.3% | 1.2% | 1.2% | 2.0% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| SMART Global Holdings, Inc. ($SGH) | | | 2.5% | 21.5% | 51.7% |
| Texas Instruments Incorporated ($TXN) | 25.1% | 29.8% | 34.9% | 43.1% | 47.5% |
| Micron Technology, Inc. ($MU) | 18.8% | 15.8% | 0.8% | 21.5% | 42.9% |
| Applied Materials Inc ($AMAT) | 15.8% | 15.2% | 19.0% | 31.2% | 36.4% |
| NVIDIA Corporation ($NVDA) | 9.2% | 13.3% | 13.1% | 27.3% | 35.3% |
| |
|---|
| Median (73 companies) | 5.7% | 3.8% | 1.7% | 3.2% | 5.2% |
|---|
| O2Micro International Limited ($OIIM) | -11.8% | -14.9% | -7.0% | -7.9% | -10.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| MACOM Technology Solutions Holdings, Inc. ($MTSI) | 25.4x | 3.3x | 3.0x | 7.2x | 98.6x |
| Inphi Corporation ($IPHI) | | -6.4x | 4.5x | 33.7x | 32.2x |
| JinkoSolar Holding Company Limited ($JKS) | 4.2x | 3.3x | 4.1x | 11.0x | 8.2x |
| Lattice Semiconductor Corporation ($LSCC) | -1.8x | | 6.5x | 19.0x | 3.9x |
| Renesola Ltd. ($SOL) | 7.0x | 35.0x | 123.6x | 2.3x | 3.3x |
| |
|---|
| Median (46 companies) | -0.5x | -0.2x | 0.2x | 0.4x | 0.3x |
|---|
