MOSAID Reports Results for First Quarter Fiscal 2012 and Dividend
(firmenpresse) - OTTAWA, ONTARIO -- (Marketwire) -- 08/25/11 -- MOSAID Technologies Incorporated (TSX: MSD) today announced financial results for the first quarter of fiscal 2012, ended July 31, 2011.
The Company adopted International Financial Reporting Standards ("IFRS") effective May 1, 2011. The accompanying interim financial statements represent the Company's first set of financial statements prepared in accordance with IFRS.
Q1 Fiscal 2012 Results
"MOSAID delivered a solid first quarter to begin the fiscal year," said John Lindgren, President and CEO, MOSAID. "Operationally, we made significant progress in implementing our new multi-year strategy to drive future revenue growth through increased investments in litigation, patent acquisitions, and our people. We were particularly active in the courts, moving to assert our intellectual property rights by initiating patent infringement suits in the areas of semiconductor memory, Power over Ethernet technology, wireless communications, and cloud computing."
MOSAID had cash and marketable securities of $122.9 million at the end of the first quarter of fiscal 2012, compared to $114.8 million at the end of the fourth quarter of fiscal 2011. In Q1 fiscal 2012, MOSAID returned $3.0 million to shareholders in quarterly dividend payments.
On August 25, 2011, MOSAID declared a quarterly dividend of $0.25 per share. The dividend, which is an eligible dividend, is payable on October 6, 2011 to shareholders of record as of September 22, 2011.
A reconciliation of adjusted net income to International Financial Reporting Standards (IFRS) net income is included in the adjusted consolidated financial statements accompanying this press release.
First Quarter Operational Highlights
Microcomponents patent licensing: MOSAID entered into a non-exclusive patent portfolio license agreement with Analog Devices, Inc. (ADI). According to the terms of the agreement, MOSAID granted ADI a worldwide term license under its microcomponents patents covering certain ADI digital signal processing products. Since the beginning of calendar 2011, MOSAID has signed microcomponents patent license agreements with LG Electronics Inc., MediaTek Inc. and now with ADI.
Patent portfolio development: MOSAID had 2,869 patents and applications at the end of Q1 fiscal 2012, up from 2,822 at the end of Q4 fiscal 2011, and up 40% from 2,050 one year ago. The approximately 500 patents and patent applications recently acquired from Hynix Semiconductor Inc., which will be recorded following the completion of the selection process, will bring the portfolio to approximately 3,400 patents and applications.
During the quarter, MOSAID purchased an MPEG patent portfolio that is relevant to the MPEG, 3GPP and 3GPP2 media file standards. The patents cover certain products that have media playing capabilities, such as mobile phones, tablets, media player software and video conversion tools.
Research and Development: MOSAID introduced a production-ready 256Gb HLNAND™ (HyperLink NAND) Flash memory semiconductor chip. The 256Gb HLNAND device is optimized for mass storage applications, including enterprise data centers and high-performance computing applications. MOSAID's 256Gb HLNAND Flash chip is one of the fastest, highest-density, best performing Flash memory devices on the market. By sampling a production-ready 256Gb HLNAND chip, the Company is demonstrating that HLNAND can be manufactured cost-effectively, flexibly and at high yields.
MOSAID showcased the 256Gb HLNAND Flash device and its new HLNAND2 technology at the 2011 Flash Memory Summit, August 9-11, in Santa Clara, California.
Litigation update: On May 10, 2011, MOSAID initiated patent infringement litigation against Elpida Memory, Inc., Buffalo Inc. and Axiontech. MOSAID believes the defendants are infringing six patents related to Dynamic Random Access Memory (DRAM) circuit and process technology.
On May 16, 2011, MOSAID filed a complaint against Cisco Systems before the International Trade Commission (ITC). The complaint alleges that Cisco is infringing six patents relating primarily to Power-over-Ethernet technology. On June 16, 2011, the ITC voted to institute an investigation of certain Cisco products, based on the complaint filed by MOSAID. Further, the United States Patent and Trademark Office recently completed a re-examination of US patent 6,480,510, a predecessor of three of the patents at issue before the ITC. The re-examination is favorable and may assist the Company during the ITC proceedings.
On July 7, 2011, MOSAID sued HTC America, Inc. and Sony Ericsson Mobile Communications (USA), Inc. for infringing four U.S. patents that are essential to all cellular telephones that implement the E-911 emergency standard, as mandated by the U.S. Federal Communications Commission.
Subsequent to the quarter end, on August 9, 2011, MOSAID filed suit against seven companies, including Adobe Systems, Inc., Alcatel-Lucent USA, Inc., IBM Corp. and Juniper Networks, Inc., for infringing two of MOSAID's computer networking patents.
Also on August 9, 2011, MOSAID announced that ARM, Ltd. and ARM, Inc. filed a Complaint for Declaratory Judgment against the Company. On April 7, 2011, MOSAID filed suit against NVIDIA Corporation, Freescale Semiconductor, Inc. and Interphase Corp., alleging infringement of seven U.S. patents related primarily to power management techniques and microprocessor architecture. ARM, in its complaint, is seeking a declaration of non-infringement and invalidity with respect to the same seven U.S. patents at issue in MOSAID's suit against NVIDIA, Freescale and Interphase.
Also subsequent to quarter end, MOSAID received a notice of allowance for the re-examination of U.S Patent No. 6,480,510. This patent is the grandfather of three of the patents at issue before the ITC and we believe the results of their re-examination may assist MOSAID's case.
Corporate governance: the Company announced changes to the Board of Directors. John P. Veschi, Chief Intellectual Property Officer, Nortel Networks Inc., and J. Ian Giffen, an independent financial and technology advisor, were appointed as directors. Gene Davis, Chairman and CEO of Pirinate Consulting Group, stepped down from the Board due to other commitments. The Board thanks him for his many contributions.
The Board of Directors also congratulates Phil Shaer, Vice President, General Counsel & Corporate Secretary of MOSAID, for his achievement in being named a Finalist in Lexpert®'s Rising Stars - Leading Lawyers Under 40 competition.
Q2 and Fiscal 2012 Guidance
Management offers the following guidance for the second quarter of fiscal 2012:
For the full fiscal year 2012, the Company is maintaining the guidance previously announced on June 16, 2011:
The above information is considered material forward-looking information. Financial guidance is provided to assist investors and other interested parties in understanding the Company's business. The reader is cautioned that using this information for any other purpose may be inappropriate.
Adjusted net income, which is not an international financial reporting standard (IFRS) measure, is IFRS net income adjusted for stock-based compensation, patent amortization, imputed interest, foreign exchange gains and losses on "other long-term liabilities," and non-recurring items as reconciled below. The Company uses adjusted measures internally to evaluate and manage operating performance as well as to forecast and plan. Non-IFRS measures do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers.
MOSAID's revenues result primarily from intellectual property agreements, which by their nature may actually close on dates other than those projected. MOSAID's priority and focus is on obtaining the best terms possible under its agreements, rather than on the particular timing of agreement closure. MOSAID's revenues depend upon, among other items, the continued ability of its licensees to pay amounts as they become due. The Company takes steps, including monitoring the creditworthiness of its licensees, in order to manage this risk.
Due to the nature of the expense, patent licensing and litigation expense can vary significantly quarter-to-quarter.
The "Forward-Looking Information" section of this document provides information on various risks and uncertainties faced by the Company.
The complete financial statements and management's discussion and analysis for first quarter ended July 31, 2011 are available on MOSAID's website at or at .
Conference Call and Webcast
Management will hold a conference call and webcast on Thursday, August 25, 2011 at 5:00 p.m. ET. The webcast will be live at and may also be accessed by dialing 1-800-446-1671. Please provide confirmation number 30494016. The webcast will be available on mosaid.com for 90 days following the event.
About MOSAID
MOSAID Technologies Inc. is one of the world's leading intellectual property companies. MOSAID licenses patented intellectual property in the areas of semiconductors and communications and develops semiconductor memory technology. MOSAID counts many of the world's largest technology companies among its licensees. Founded in 1975, MOSAID has offices in Ottawa, Ontario and Plano, Texas. For more information, please visit and
Non-GAAP Measures and Definitions
Throughout this press release, we refer to a number of measures which we believe are meaningful in the assessment of the Company's performance. All these metrics are non-standard measures under IFRS, and are unlikely to be comparable to similarly titled measures reported by other companies. Readers are cautioned that the disclosure of these items is meant to add to, and not replace, the discussion of financial results or cash flows from operations as determined in accordance with IFRS. For a discussion of the purpose of these non-GAAP measures, please refer to the Company's Fiscal 2011 MD&A on SEDAR at .
Adjusted net income, a non-IFRS measure, is IFRS net income adjusted for share-based compensation, patent amortization, imputed interest, foreign exchange gains and losses on "Other long-term liabilities," and any other non-recurring items. The Company uses adjusted measures internally to evaluate and manage operating performance, and to forecast and plan. Non-IFRS measures do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers.
Forward Looking Information
This document and certain other public documents incorporated by reference in this document, contain forward-looking statements to the extent they relate to MOSAID or its management, including those identified by the expressions "anticipate," "believe," "could," "estimate," "expect," "foresee," "intend," "may," "plan," "will," "would" and similar expressions. Similarly, statements in this document that describe MOSAID's business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. These forward-looking statements are not historical facts, but rather reflect MOSAID's current expectations regarding future events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results, performance or achievements to differ materially from those in such forward-looking statements. Assumptions made in preparing forward-looking statements and financial guidance include, but are not limited to, the following: MOSAID's continued expansion of its patent portfolio and of its opportunities for future patent licensing revenue as a result of MOSAID's acquisition of patents from third parties and from development of new inventions; semiconductor and telecommunications product vendors continuing to infringe MOSAID's patents; the timing and amount of MOSAID's litigation expenses; MOSAID's ability to sign new patent licensees; current assumptions as to the identification of products that are unlicensed to MOSAID's wireless patents; and the timing and amount of MOSAID's Research & Development expenses.
Factors that could cause actual results to differ materially from expected results include, but are not limited to, the following: MOSAID's ability to negotiate settlements with licensees; legal rulings and/or regulatory investigations, audits or complaints having an adverse impact on the validity, enforceability, royalty rates, potential royalty rates, and strength or breadth of coverage of MOSAID's essential and/or nonessential patents (including, but not limited to, adverse results from litigation or proceedings in patent offices and government regulatory agencies in various countries around the world); judicial, legislative or regulatory changes that impair the ability of patent holders to earn licensing revenues; worldwide economic conditions and demand for technology products; economic, social, and political conditions both globally and in the countries in which MOSAID or patent licensees operate, including conflict, war and, other security risks, health conditions, possible disruptions in transportation networks and fluctuations in foreign currency exchange rates; non-payment or delays in payment by or insolvency of licensees or other debtors; variability in patent licensees' sales of licensed products; failure to maintain and enforce MOSAID's existing patent portfolio, or failure to obtain valuable patents as a result of R&D activities, or failure to acquire valuable patents from third parties; MOSAID's ability to recruit and retain skilled personnel; change in MOSAID's financial position; consolidation of MOSAID's licensees; natural events, such as severe weather and earthquakes in the locations in which MOSAID or patent licensees operate; and changes in the tax rate applicable to MOSAID as the result of changes in the tax law in the jurisdictions in which profits are determined to be earned and taxed, the outcome of tax audits and the ability to realize deferred tax assets.
Except as may be required by applicable law or stock exchange regulation, we undertake no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events. Accordingly, readers should not place undue reliance on forward-looking statements. If we do update one or more forward-looking statements, no inference should be drawn that additional updates will be made with respect to those or other forward-looking statements. Additional information identifying risks and uncertainties affecting MOSAID's business and other factors that could cause MOSAID's financial results to fluctuate are contained in MOSAID's Annual Information Form, under the section entitled "Risk Factors," and in MOSAID's other public filings available online at .
MOSAID Technologies Incorporated
Unaudited Adjusted Consolidated Financial Statements
For the Quarter Ended July 31, 2011
The attached consolidated financial statements have been prepared by Management of MOSAID Technologies Incorporated and have not been reviewed by an auditor.
Adjusted net income, which is not an International Financial Reporting Standard (IFRS) measure, is IFRS net income adjusted for stock-based compensation, patent amortization, imputed interest, foreign exchange gains and losses on "other long-term liabilities," and non-recurring items as reconciled below. The Company uses adjusted measures internally to evaluate and manage operating performance as well as to forecast and plan. Non-IFRS measures do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers.
Adjusted net income is reconciled to IFRS net income as follows:
Adjusted foreign exchange (gain) is reconciled to IFRS foreign exchange loss as follows:
MOSAID Technologies Incorporated
Unaudited Consolidated Condensed Financial Statements
For the Period Ended July 31, 2011
The attached consolidated financial statements have been prepared by Management of MOSAID Technologies Incorporated and have not been reviewed by an auditor.
See accompanying Notes to the Condensed Consolidated Financial Statements
See accompanying Notes to the Condensed Consolidated Financial Statements
See accompanying Notes to the Consolidated Condensed Financial Statements
See accompanying Notes to the Condensed Consolidated Financial Statements
See accompanying Notes to the Condensed Consolidated Financial Statements
Contacts:
Investor and Media Inquiries
Michael Salter
Director, Investor Relations
and Corporate Communications
613-599-9539 x1205
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Datum: 25.08.2011 - 14:01 Uhr
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