Dialog Semiconductor plc reports results for its fourth quarter and year ended 31 December 2014. Q4 and full year 2014 financial highlights based on globally accepted International Financial Reporting Standards (IFRS) included: Q4 2014 IFRS Revenue, up 24% over Q4 2013 to $435 million. Full year IFRS revenue up 28% to $1,156 million; Full year IFRS gross margin at 44.5%; and Q4 2014 underlying EBITDA up 50% to $129.6 million or 29.8% of revenue. Full year underlying EBITDA was up 55% to $269.4 million or 23.3% of revenue; and Q4 IFRS operating profit (EBIT) up 49% to $105.1million or 24.2% of revenue.
Full year IFRS EBIT up 81% to $185.9 million or 16.1% of revenue; IFRS full year tax rate at 18.5%, including one-off non-cash deferred tax credit of $17.8 million; 29.0% IFRS tax rate excluding one-off; Underlying Q4 2014 diluted EPS up 67% over Q4 2013 to $1.17. Full year 2014 Underlying diluted EPS up 58% to $2.27; and Cash from operating activities in Q4 2014 was up 158% to $119.3 million. Cash and cash equivalents balance as of 31 December 2014 was $324 million.
IFRS Revenue in Q4 2014 was 24% above the previous year with strong performance across most business segments: Mobile Systems was up 24%, Power Conversion, up 55% (38% on an underlying basis) and Connectivity was up 18%. Q4 2014 IFRS gross margin was 410bps above Q4 2013 and 150bps above the previous quarter. This was the result of the following items: Higher revenue achieved in the quarter and the subsequent lower allocation per unit of the fixed component of Cost of Goods Sold; Benefits of manufacturing cost optimization, yield and test time improvements in high volume products; and Positive product mix contribution from new products in Mobile Systems, Connectivity and Power Conversion.
Commenting on the results Dialog Chief Executive, Dr Jalal Bagherli, said: "I am extremely pleased with the exceptional business performance we have achieved in Q4 and over the full year. We have delivered uninterrupted annual revenue growth for the 8th consecutive year; while significantly increasing margins, investing in R&D and generating high cash returns to allow the company to return to a bank debt free position significantly ahead of schedule.
“Our financial performance reflects our relentless focus on delivering competitive and differentiated products in high growth consumer electronics markets. We now have good visibility of another year of growth ahead in 2015, with Dialog at the core of a new generation of ultra-portable devices and low-power connected consumer electronics."
“Given our current visibility, we expect 2015 to be another year of good growth. As in previous years, revenue performance will be strongly weighted towards the second half of the year,†Bagherli continued. “Q1 2015 revenue will reflect the expected seasonal pattern and deliver year on year growth. We expect revenue for Q1 2015 to be in the range of $265 to $300 million. In line with the seasonal lower revenue, gross margin in Q1 2015 will decline sequentially but improve on a year-on-year basis. Gross margin in 2015 is expected to remain broadly at a similar level to the full year 2014.â€
