Gaming

GigaMedia Limited (NASDAQ: GIGM) today announced its first quarter 2021 unaudited financial results.

Comments from Management

For the first quarter of 2021, GigaMedia reported revenues of $1.45 million with a gross profit of $0.79 million , an operating loss of $0.90 million and the net loss of $0.88 million . Total revenues increased by 2.0% if compared to the previous quarter.

"Our business momentum has slowed since the fourth quarter 2020," said GigaMedia CEO James Huang , "but as we stick with our strategies of internally-driven growth and effective marketing, we managed to sustain growth in revenues and keep costs and expenses in check."

First Quarter Overview

  • Operating revenue s increased slightly by 2.0% in quarter-on-quarter comparison , and decreased by 9.9% year-over-year. The slowdown was primarily due to declines in certain of our licensed mobile games, where the upgrades and supports from our Japanese and Korean licensors were severely hampered by the COVID-19 pandemic.
  • Loss from operations increased to $0.90 million from $0.61 million last quarter, and net loss to $0.88 million , from $0.34 million last quarter . The increases were mainly due to rises in certain general expenses.

Unaudited Consolidated Financial Results

GigaMedia Limited is a diversified provider of digital entertainment services. GigaMedia's digital entertainment service business FunTown develops and operates a suite of digital entertainments in Taiwan and Hong Kong , with focus on mobile games and casual games. Unaudited consolidated results of GigaMedia are summarized in the table below.

For the First Quarter

GIGAMEDIA 1Q21 UNAUDITED CONSOLIDATED FINANCIAL RESULTS

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


1Q21


4Q20


Change

(%)



1Q21


1Q20


Change

(%)


Revenues



1,446



1,418



2.0

%



1,446



1,604



(9.9)

%

Gross Profit



791



818



(3.3)

%



791



927



(14.7)

%

Loss from Operations



(901)



(607)


NM




(901)



(640)


NM


Net Loss Attributable to GigaMedia



(875)



(340)


NM




(875)



(286)


NM


Loss Per Share Attributable to GigaMedia, Diluted



(0.08)



(0.03)


NM




(0.08)



(0.03)


NM


EBITDA (A)



(949)



(411)


NM




(949)



(536)


NM


Cash , Cash Equivalents and Restricted Cash



44,446



46,002



(3.4)

%



44,446



57,311



(22.4)

%






















NM= Not Meaningful


























(A) 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.)

First -Quarter Financial Results

  • Consolidated revenues for the first quarter of 2021 increased by 2.0% quarter-on-quarter to $1.45 million , from $1.42 million in the fourth quarter of 2020, and decreased by 9.9% year-over-year from $1.60 million in the first quarter of 2020. The slowdown was primarily due to declines in certain of our licensed mobile games, where the upgrades and supports from our Japanese and Korean licensors were severely hampered by the COVID-19 pandemic.
  • Consolidated gross profit decreased to $0.79 million from $0.82 million in last quarter and decreased by 14.70% from $0.93 million in the same quarter last year.
  • Consolidated operating expenses were $1.69 million in the first quarter of 2021, representing an increase by $0.27 million quarter-on-quarter, or an increase by $0.13 million from $1.57 million year-over-year. The increase was mainly due to rises in certain general expenses.
  • Net loss for the first quarter of 2021 was $0.87 million , increased from a loss of $0.34 million in the fourth quarter of 2020, from a loss of $0.28 million in the same quarter last year.
  • Cash , cash equivalents and restricted cash at the first quarter-end of 2021 accounted for $44.45 million , which decreased by $1.56 million from the end of 2020.

Financial Position

GigaMedia maintained its solid financial position, with cash, cash equivalents and restricted cash amounting to $44.45 million , or approximately $4.02 per share as of March 31, 2021 .

Business Outlook

The following forward-looking statements reflect GigaMedia's expectations as of May 3 , 20 21 . Given potential changes in economic conditions and consumer spending, the evolving nature of digital entertainments , and various other risk factors, including those discussed in the Company's 2020 Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission as referenced below, actual results may differ materially.

"The second quarter of 2021 is already expected to be tough," cautioned GigaMedia CEO James Huang , "but we will continue boosting productivities and enhancing services for our in-house developed casual games by introducing fast-paced playability and accelerating the development of our customer platform."

Meanwhile, our business strategies always include expanding through mergers and acquisitions. "Including the possible cooperation with Aeolus Robotics Corporation," said CEO James Huang , "we will keep pursuing investment opportunities that are with strategic potentials to expand our business and create greater shareholder value."

Use of Non-GAAP Measures

To supplement GigaMedia's consolidated financial statements presented in accordance with U.S. GAAP, the company uses the following measure defined as non-GAAP by the SEC: EBITDA. Management believes that EBITDA (earnings before interest, taxes, depreciation, and amortization) is a useful supplemental measure of performance because it excludes certain non-cash items such as depreciation and amortization and that EBITDA is a measure of performance used by some investors, equity analysts and others to make informed investment decisions. EBITDA is not a recognized earnings measure under GAAP and does not have a standardized meaning. Non-GAAP measures such as EBITDA should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, other financial measures prepared in accordance with GAAP. A limitation of using EBITDA is that it does not include all items that impact the company's net income for the period. Reconciliations to the GAAP equivalents of the non-GAAP financial measures are provided on the attached unaudited financial statements.

About the Numbers in This Release

Quarterly results

All quarterly results referred to in the text, tables and attachments to this release are unaudited. The financial statements from which the financial results reported in this press release are derived have been prepared in accordance with U.S. GAAP, unless otherwise noted as "non-GAAP," and are presented in U.S. dollars.

Q&A

For Q&A regarding the first quarter 2021 performance upon the release, investors may send the questions via email to IR@gigamedia.com.tw , and the responses will be replied individually.

About GigaMedia

Headquartered in Taipei, Taiwan , GigaMedia Limited ( Singapore registration number: 199905474H) is a diversified provider of digital entertainment services. GigaMedia's digital entertainment service business develops and operates a suite of digital entertainments in Taiwan and Hong Kong , with focus on browser/mobile games and casual games. More information on GigaMedia can be obtained from www.gigamedia.com .

The statements included above and elsewhere in this press release that are not historical in nature are "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding expected financial performance (as described without limitation in the "Business Outlook" section and in quotations from management in this press release) and GigaMedia's strategic and operational plans. These statements are based on management's current expectations and are subject to risks and uncertainties and changes in circumstances. There are important factors that could cause actual results to differ materially from those anticipated in the forward looking statements, including but not limited to, our ability to license, develop or acquire additional online games that are appealing to users, our ability to retain existing online game players and attract new players, and our ability to launch online games in a timely manner and pursuant to our anticipated schedule. Further information on risks or other factors that could cause results to differ is detailed in GigaMedia's Annual Report on Form 20-F filed in April 2021 and its other filings with the United States Securities and Exchange Commission.

(Tables to follow)

GIGAMEDIA LIMITED

CONSOLIDATED STATEMENTS OF OPERATIONS



Three months ended



3/31/2021


12/31/2020


3/31/2020



unaudited


unaudited


unaudited



USD


USD


USD

Operating revenues










Digital entertainment service revenues



1,446,276



1,417,636



1,603,904

Other revenues










1,446,276



1,417,636



1,603,904

Operating costs










Cost of digital entertainment service revenues



655,757



599,458



677,194

Cost of other revenues










655,757



599,458



677,194

Gross profit



790,519



818,178



926,710

Operating expenses










Product development and engineering expenses



345,898



324,404



328,815

Selling and marketing expenses



397,033



466,093



410,475

General and administrative expenses



946,192



634,118



824,442

Other



2,599



163



2,984




1,691,722



1,424,778



1,566,716

Loss from operations



(901,203)



(606,600)



(640,006)

Non-operating income (expense)










Interest income



78,595



73,403



255,719

Foreign exchange (loss) gain - net



(49,357)



142,951



98,887

Other-net



(2,809)



50,256



(298)




26,429



266,610



354,308

Loss before income taxes



(874,774)



(339,990)



(285,698)

Income tax expense







Net loss attributable to shareholders of GigaMedia



(874,774)



(339,990)



(285,698)

Loss per share attributable to GigaMedia










Basic:



(0.08)



(0.03)



(0.03)

Diluted:



(0.08)



(0.03)



(0.03)

Weighted average shares outstanding:










Basic



11,052,235



11,052,235



11,052,235

Diluted



11,052,235



11,052,235



11,052,235

GIGAMEDIA LIMITED

CONSOLIDATED BALANCE SHEETS



3/31/2021


12/31/2020


3/31/2020



unaudited


audited


unaudited



USD


USD


USD

Assets










Current assets










Cash and cash equivalents



44,146,308



45,702,352



56,777,472

Accounts receivable - net



281,945



274,584



355,225

Prepaid expenses



393,587



87,728



276,010

Restricted cash



300,000



300,000



533,436

Other receivables



25,937



3,579



238,396

Other current assets



156,622



157,020



148,757

Total current assets



45,304,399



46,525,263



58,329,296











Marketable securities - noncurrent



10,000,000



10,000,000



Property, plant & equipment - net



38,860



21,852



8,117

Intangible assets - net



11,596



3,640



17,965

Prepaid licensing and royalty fees



108,878



130,718



210,530

Other assets



2,481,910



341,701



285,319

Total assets



57,945,643



57,023,174



58,851,227











Liabilities and equity










Short-term borrowings







Accounts payable



88,009



69,931



60,405

Accrued expenses



1,244,580



1,515,712



1,606,501

Unearned revenue



949,396



949,853



1,285,399

Other current liabilities



740,286



387,712



715,877

Total current liabilities



3,022,271



2,923,208



3,668,182

Other liabilities



1,655,437



3,103



7,337

Total liabilities



4,677,708



2,926,311



3,675,519

Total equity



53,267,935



54,096,863



55,175,708

Total liabilities and equity



57,945,643



57,023,174



58,851,227

GIGAMEDIA LIMITED

Reconciliations of Non-GAAP Results of Operations



Three months ended



3/31/2021


12/31/2020


3/31/2020



unaudited


unaudited


unaudited



USD


USD


USD

Reconciliation of Net Income (Loss) to EBITDA










Net loss attributable to GigaMedia



(874,774)



(339,990)



(285,698)

Depreciation



1,902



1,192



354

Amortization



2,010



1,252



4,657

Interest income



(78,595)



(73,403)



(255,719)

Interest expense







Income tax  expense







EBITDA



(949,457)



(410,949)



(536,406)

Cision View original content: http://www.prnewswire.com/news-releases/gigamedia-announces-first-quarter-2021-financial-results-301282101.html

SOURCE GigaMedia Limited

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