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Mobileye Announces Second Quarter 2014 Financial Results

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SOURCE Mobileye N.V.

-- Total revenue of $33.7 million, up 91% year-over-year

-- Non-GAAP Net Income of $11.2 million, representing year-over-year growth of 73%

-- Non-GAAP fully diluted EPS of $0.05

-- Free cash flow of $20.0 million

JERUSALEM, Sept. 4, 2014 /PRNewswire/ -- (NYSE: MBLY) – Mobileye N.V., the global leader in the design and development of camera-based Advanced Driver Assistance Systems, today announced financial results for the second quarter ended June 30, 2014.

Mobileye Logo

"The second quarter results highlight the strength of our unique business model.  Our strong revenue growth was driven by continued robust market demand resulting from the ongoing move toward regulating ADAS as well as the value proposition of our innovative solution, which bundles multiple applications into a single package," stated Ziv Aviram, co-founder, president and chief executive officer of Mobileye.  "The completion of our initial public offering was an important milestone for us.  Mobileye now has enhanced resources to continue executing its growth strategy and further extending its technology leadership position and penetration with OEMs.  Looking forward, we have numerous opportunities to continue to drive growth, including creating new and enhanced applications to capitalize on the advantages of our complex technology.  Longer term, our position in the market will enable us to benefit significantly from the large and growing semi-autonomous and autonomous driving trend."

Second Quarter 2014 Financial Highlights

  • Revenue: Total revenue for the second quarter of 2014 was $33.7 million, an increase of 91% compared to $17.7 million in the prior-year period.  Within total revenue, original equipment manufacturing (OEM) revenue was $28.8 million, an increase of 115% compared to $13.4 million in the prior-year period.  After market (AM) revenue contributed the remaining $4.9 million of total revenue for the second quarter of 2014 compared to $4.3 million in the prior-year period, an increase of 14%.

  • Net Income and earnings per share:  GAAP net income for the second quarter of 2014 was $0.2 million or approximately break-even on a per class A share basis. This compares to GAAP net income of $4.0 million, or $0.02 per class A share during the second quarter of 2013.  GAAP results included share-based compensation expense of $11.0 million for the second quarter of 2014 and $2.4 million for the second quarter of 2013. 

    Non-GAAP net income for the second quarter of 2014 was $11.2 million or $0.05 per share based on 216.5 million weighted average diluted shares outstanding (reflecting the conversion of all class shares to ordinary shares). This compares to non-GAAP net income of $6.4 million, or $0.03 per share based on 198.7 million weighted average diluted shares outstanding during the second quarter of 2013. Non-GAAP net income excludes share-based compensation expenses, (reflecting the conversion of all class shares to ordinary shares).  

  • Cash and Cash Flow: As of June 30, 2014, Mobileye had cash, cash equivalents and short-term investments of $149.0 million, compared to $124.4 million as of December 31, 2013.  Subsequent to the end of the quarter, Mobileye closed its initial public offering (IPO) on August 6, 2014, which generated net proceeds of $193.7 million.

    The company generated $23.4 million in net cash from operating activities for the second quarter of 2014 compared to generating $4.7 million during the second quarter of 2013.  The company generated $20.0 million in free cash flow for the second quarter of 2014 compared to $3.4 million during the comparable second quarter of 2013 mainly as a result of the increase in revenue as described above.  Free cash flow represents net cash provided by operating activities minus capital expenditures.

A reconciliation of the non-GAAP financial measures to GAAP measures has been provided in the financial tables included in this press release. An explanation of the non-GAAP financial measures and how they are calculated is included below under the heading "Non-GAAP Financial Measures."

Quarterly Conference Call
Mobileye will host a conference call at 8:00 a.m. Eastern Daylight Time (U.S. time) today (Thursday, September 4, 2014) to review the company's financial results for the second quarter ended June 30, 2014 and to provide guidance for the balance of fiscal year 2014.  A live Webcast of the conference call will be accessible from the Investor Relations section of Mobileye's website at http://ir.mobileye.com.  An archive of the Webcast will be available through December 4, 2014.

About Mobileye
Mobileye N.V. is the global leader in the design and development of software and related technologies for camera-based Advanced Driver Assistance Systems. Our technology keeps passengers safer on the roads, reduces the risks of traffic accidents, saves lives and has the potential to revolutionize the driving experience by enabling autonomous driving.  Our proprietary software algorithms and EyeQ® chips perform detailed interpretations of the visual field in order to anticipate possible collisions with other vehicles, pedestrians, cyclists, animals, debris and other obstacles. Mobileye's products are also able to detect roadway markings such as lanes, road boundaries, barriers and similar items, as well as to identify and read traffic signs and traffic lights. Our products are integrated into car models from 20 global automakers including BMW, Ford, General Motors, Nissan and Volvo.  Our products are also available in the aftermarket.

Forward-Looking Statements
This press release contains certain forward-looking statements. Words such as "believes," "intends," "expects," "projects," "anticipates," and "future" or similar expressions are intended to identify forward-looking statements.  These statements are only predictions based on our current expectations and projections about future events.  You should not place undue reliance on these statements.  Many factors may cause our actual results to differ materially from any forward looking statement, including the risk factors and other matters set forth in Mobileye's filings with the U.S. Securities and Exchange Commission, including its registration statement on Form F-1 for the IPO.  Mobileye undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by law.

Non-GAAP Financial Measures

We have provided in this release financial information that has not been prepared in accordance with GAAP. We use these non-GAAP financial measures internally in analyzing our financial results and believe they are useful to investors as a supplement to GAAP measures. We believe that these non-GAAP financial measures also provide additional tools for investors to use in evaluating our ongoing operating results and trends and in comparing our financial results with other companies in our industry, many of which present similar non-GAAP financial measures to investors. 

Non-GAAP financial measures should not be considered in isolation from, or considered as an alternative to, operating income (loss), net income (loss), earnings per share or any other measure of financial performance calculated and presented in accordance with GAAP. Our non-GAAP measure may not be comparable to similarly titled measures of other organizations because other organizations may not calculate non-GAAP measures in the same manner. You are encouraged to evaluate these adjustments and the reason we consider them appropriate.  A reconciliation of our non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.

Non-GAAP net income (loss). To arrive at our non-GAAP net income (loss), we exclude share-based compensation expense from our GAAP net income (loss). We believe that this non-GAAP measure is useful to investors in evaluating our operating performance for the following reasons:

  • We believe that elimination of share-based compensation expense is appropriate because treatment of this item may vary for reasons unrelated to our overall operating performance;
  • We use this non-GAAP measure in conjunction with our GAAP financial measure for planning purposes, including the preparation of our annual operating budget, as a measure of operating performance and the effectiveness of our business strategies and in communications with our board of directors concerning our financial performance; and
  • We believe that this non-GAAP measure provides better comparability with our past financial performance, facilitates better period-to-period comparisons of operational results and may facilitate comparisons with similar companies, many of which may also use similar non-GAAP financial measures to supplement their GAAP reporting.

Non-GAAP EPS. To arrive at our non-GAAP EPS, we divided the non-GAAP net income by the sum of the number of our outstanding ordinary shares during the relevant period and the number of ordinary shares resulting from the conversion of all of our outstanding class shares into ordinary shares with no liquidation preferences on a one-to-one basis as set forth in our articles of association.  Subsequent to June 30, 2014, immediately prior to our IPO on August 1, 2014, all outstanding class shares were so converted into ordinary shares.

Free cash flow. We define free cash flow as net cash provided by operating activities minus capital expenditures. Free cash flow is important to reflect the cash that can allow us to pursue business strategies and opportunities and fulfill our goals. A limitation of using free cash flow versus the GAAP measure of net cash provided by operating activities as a means for evaluating our company is that free cash flow does not represent the total increase or decrease in the cash balance from operations for the period because it excludes cash used for capital expenditures during the period.  Management compensates for this limitation by providing information about our capital expenditures on the face of the cash flow statement.

From time to time, we may also provide guidance regarding projected Non-GAAP Net Income (Loss) on an aggregate and per share basis.  We cannot provide a reconciliation of our projected non-GAAP Net Income (Loss) to projected GAAP Net Income (Loss) for any future period due to the fluctuations of our stock price and lack of any historical stock price information due to our recent IPO, which impact share based compensation.  Therefore, the information necessary for a quantitative reconciliation is not available to us without unreasonable efforts. 

Company Contact:
Yonah Lloyd
Chief Communications Officer / SVP Business Development
yonah.lloyd@mobileye.com
Phone: +972-2-541-7367

 

TABLE – 1

MOBILEYE N.V.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

















For the six months ended



For the three months ended




June 30,



June 30,




2014



2013



2014



2013


Revenue


$

69,302



$

29,395



$

33,653



$

17,657


Cost of revenue



17,375




7,719




8,565




4,506



















Gross profit



51,927




21,676




25,088




13,151



















Operating costs and expenses


































Research and development, net



16,785




9,610




8,164




5,004


Sales and marketing



5,462




7,215




2,620




2,325


General and administrative



41,525




4,398




10,674




2,107



















Total operating expenses



63,772




21,223




21,458




9,436



















Operating income (loss)



(11,845)




453




3,630




3,715



















Interest income



718




593




333




242


Financial income, net



33




722




319




186



















Profit (loss) before taxes on income



(11,094)




1,768




4,282




4,143



















Taxes on income



8,276




311




4,093




119



















Net income (loss) for the period


$

(19,370)



$

1,457



$

189



$

4,024



















Basic and Diluted income (loss) per share:

















Amount allocated to participating shareholders



-




(1,152)




(159)




(3,182)


Net income (loss) applicable to Class A shares



(19,370)




305




30




842


Basic and Diluted


$

(0.60)



$

0.01



$

0.00



$

0.02



















Weighted average number of Class A shares

















Basic and Diluted



32,071




40,191




32,071




40,191




































 

 

 

TABLE – 2

MOBILEYE N.V.

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME

(in thousands, except per share data)




For the six months ended



For the three months ended



June 30,



June 30,



2014



2013



2014



2013













GAAP  net income (loss) as reported


$

(19,370)



$

1,457



$

189



$

4,024

















Non-GAAP adjustment 
















Expenses recorded for Stock based compensation
















      Cost of revenues



15




-




7




-

      Research and development



2,359




718




1,089




310

      Sales and marketing



1,803




4,268




723




729

      General and administrative



38,969




1,935




9,154




1,386

Total adjustment



43,146




6,921




10,973




2,425

















Non-GAAP net income



23,776




8,378




11,162




6,449

















Non-GAAP net income (loss) per share
















Basic


$

0.12



$

0.04



$

0.06



$

0.03

Diluted


$

0.11



$

0.04



$

0.05



$

0.03

















Weighted average number of shares (in thousands)
















Basic



202,513




191,986




202,513




191,986

Diluted



213,941




198,690




216,485




198,691

















































































































TABLE – 3

MOBILEYE N.V.

RECONCILIATION OF GAAP NET CASH FROM OPERATING ACTIVITIES TO FREE CASH FLOWS

(U.S. dollars in thousands)




For the six months ended



For the three months ended



June 30,



June 30,



2014



2013



2014



2013













GAAP net cash from operating activities as reported


$

28,395



$

4,668



$

23,360



$

4,673

















Capital Expenditures 



(3,456)




(1,726)




(3,374)




(1,284)

Free Cash Flow



24,939




2,942




19,986




3,389

 

 

TABLE – 4

MOBILEYE N.V.

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)




June 30,



December 31,




2014



2013


Assets







Current assets







Cash and cash equivalents


$

92,684



$

72,560


Short-term deposits



2,531




5,006


Marketable securities



53,744




46,718


Restricted cash



78




78


Trade account receivables, net



20,971




12,490


Inventories



15,592




11,354


Other current assets



6,253




7,025


Total current assets



191,853




155,231











Long-term assets









Property, plant and equipment



8,476




5,697


Funds in respect of employee rights upon retirement



7,775




6,962


Other assets



554




338


Total long-term assets



16,805




12,997











Total assets


$

208,658



$

168,228


Liabilities and shareholders' equity









Current liabilities









Accounts payable and accrued expenses


$

19,262



$

11,096


Employee related accrued expenses



3,924




3,338


Other current liabilities



3,209




1,441


Total current liabilities



26,395




15,875











Long-term liabilities









Liability in respect of employee rights upon retirement



9,346




8,313


Long-term liabilities



5,476




1,402


Total long-term liabilities



14,822




9,715











Total liabilities



41,217




25,590











Shareholders' equity



























Share capital



2,350




2,350











(Immediately prior to our IPO, all classes of shares were converted to ordinary shares on a 1:1 basis and 8,325,000 new ordinary shares were issued in the IPO.  Post IPO there are no class shares and 212,301,196 ordinary shares issued and outstanding)









Additional paid-in capital



284,350




240,563


Accumulated other comprehensive income



998




612


Accumulated deficit



(120,257)




(100,887)


Total shareholders' equity



167,441




142,638











Total liabilities and shareholders' equity


$

208,658



$

168,228


 

 

TABLE – 5

MOBILEYE N.V.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands)




For the six months ended



For the three months ended




June 30,



June 30,




2014



2013



2014



2013


Cash flows from operating activities













Net income (loss) for the period


$

(19,370)



$

1,457



$

189



$

4,024


Adjustments to reconcile net income (loss) to net cash

















   provided by (used in) operating activities:

















   Depreciation



1,179




790




663




424


   Exchange rate differences on cash and cash equivalents



134




(60)




25




(83)


   Liability in respect of employee rights upon retirement



1,033




827




665




381


   Loss (gain) and exchange rate differences from

















      marketable securities



41




(576)




(189)




(140)


   Loss from sale of property and equipment



-




22




-




22


   Share-based compensation



43,146




6,921




10,973




2,425


   Changes in asset and liabilities:

















      Trade accounts receivables, net



(8,481)




(4,698)




122




(5,254)


      Other current assets



1,075




(866)




32




1,029


      Inventories



(4,238)




(661)




(3,711)




(347)


      Other long-term assets



(216)




(87)




(134)




(60)


      Trade payables and accrued expenses



7,664




925




10,437




1,641


      Employee-related accrued expenses



586




415




206




262


      Other current-liabilities



1,768




150




1,906




343


      Long-term liabilities



4,074




109




2,176




6


Net cash from operating activities



28,395




4,668




23,360




4,673



















Cash flows from investing activities

















   Investment in short-term deposits



(33,146)




(6,883)




(156)




(6,664)


   Proceeds from short-term deposits



35,621




9,531




11,461




7,233


   Proceeds from maturities / sales of marketable securities



11,975




10,741




7,763




3,738


   Purchase of marketable securities



(18,656)




(4,599)




(9,818)




(1,856)


   Funds in respect of employee right upon retirement



(813)




(679)




(526)




(330)


   Purchase of property and equipment



(3,456)




(1,726)




(3,374)




(1,284)


Net cash from (used in) investing  activities



(8,475)




6,385




5,350




837



















Cash flows from financing activities

















   Issuance expenses



(303)




(140)




(303)




(140)


   Exercise of options



641




149




28




73


Net cash from (used in) financing activities



338




9




(275)




(67)



















Exchange rate differences on cash and cash equivalents



(134)




60




(25)




83



















Increase in cash and cash equivalents



20,124




11,122




28,410




5,526


Balance of cash and cash equivalents at the beginning of 
 the period



72,560




14,979




64,274




20,575


Balance of cash and cash equivalents at the end of the 
 period


$

92,684



$

26,101



$

92,684



$

26,101



















Supplementary information on activities not involving 
 cash flow:

















   Income taxes paid


$

269



$

336



$

92



$

144


   Non cash purchase of property and equipment


$

502



$

427










 

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