Delaware |
95-2039518 | |||
(State
or other jurisdiction of |
(I.R.S.
Employer | |||
incorporation
or organization) |
Identification
Number) |
3050
East Hillcrest Drive |
||
Westlake
Village, California |
91362 | |
(Address
of principal executive offices) |
(Zip
Code) |
Markets
Served |
End-product
Applications |
Consumer
Electronics |
Set-top
Boxes (cable/DSS), Game Consoles, Smart Appliances, Digital Audio Players,
MP3, Digital Cameras, Mobile handset and smart phones, Caller ID Boxes,
Answering Machines, Personal Medical Devices
|
Computing
and Peripherals |
Notebooks,
LCD/TFT Displays, Motherboards, PDAs/Pocket PCs, Scanners, Servers, NICs,
Hard Drives |
Industrial |
Ballast
Lighting, Power Supplies, DC-DC Conversion, Security/Access Systems, Motor
Controls, HVAC |
Communications |
Gateways,
Routers, Switches, Hubs, Fiber Optics,
Wireless,
Ethernet, Power/Phone Line Networks |
Automotive |
Comfort
Controls, Audio/Video Players, GPS Navigation, Safety, Security, Satellite
Radios, Engine Control |
· |
Better
control of product quality; |
· |
Faster
time-to-market for new products; |
· |
Ability
to customize devices to customer
requirements; |
· |
Ability
to develop and market devices that are differentiated in the marketplace
with proprietary processes and designs; and |
· |
Improved
access to wafers and devices in limited supply
conditions. |
Performance
Schottky Rectifiers |
Standard
Recovery Rectifiers |
Transient
Voltage Suppressors (TVS) |
Performance
Schottky Diodes |
Bridge
Rectifiers |
Small
Signal Bipolar Transistors |
Super-Fast
& Ultra-Fast Recovery Rectifiers |
Switching
Diodes |
Prebiased
Transistors (PBT) |
Fast
Recovery Rectifiers |
Zener
Diodes |
High
Density Transistor Arrays |
Small
Signal MOSFETs |
High
Density Diodes |
Application
and Customer Specific Arrays |
SOT-23 |
SOT-523 |
SMA |
SOT-25 |
SOD-523 |
SMB |
SOT-26 |
SC-59 |
SMC |
SOT-143 |
SOT-563 |
DPAK |
SOD-323 |
SOD-123 |
D2PAK |
SOT-363 |
SOT-323 |
Powermiteâ3 |
Power
DI™5 | ||
Power
DI™123 |
DO-15 |
DO-201AD |
A-405 |
DO-35 |
TO-220AC |
TO-3P |
DO-41 |
TO-220AB |
Numerous
Bridge Rectifier Packages |
· |
difficulties
associated with owning a manufacturing business, including, but not
limited to, the maintenance and management of manufacturing facilities,
equipment, employees and inventories and limitations on the flexibility of
controlling overhead; |
· |
difficulties
implementing our Enterprise Resource Planning
system; |
· |
difficulties
expanding our operations in the Far East and developing new operations in
Europe because of the distance and differing regulatory and cultural
environments; |
· |
the
need for skills and techniques that are outside our traditional core
expertise; |
· |
less
flexibility in shifting manufacturing or supply sources from one region to
another; |
· |
even
when independent suppliers offer lower prices, we must continue to acquire
product from our captive manufacturing facilities, which may result in
having higher costs than our competitors; |
· |
difficulties
developing and implementing a successful research and development
team; |
· |
difficulties
developing proprietary technology; and |
· |
market
acceptance of our proprietary technology. |
· |
changes
in, or impositions of, legislative or regulatory requirements, including
tax laws in the United States and in the countries in which we manufacture
or sell our products; |
· |
trade
restrictions, transportation delays, work stoppages, and economic and
political instability; |
· |
changes
in import/export regulations, tariffs and freight
rates; |
· |
difficulties
in collecting receivables and enforcing
contracts; |
· |
currency
exchange rate fluctuations, including, but not limited to fluctuations in
the Chinese Yuan should the Chinese government decide to permit the Yuan
to U.S. dollar exchange rate to fluctuate; |
· |
restrictions
on the transfer of funds from foreign subsidiaries to Diodes-North
America; and, |
· |
longer
customer payment terms. |
· |
general
economic conditions in the countries where we sell our
products; |
· |
seasonality
and variability in the computer and communications market and our other
end markets; |
· |
the
timing of our and our competitors' new product
introductions; |
· |
product
obsolescence; |
· |
the
scheduling, rescheduling and cancellation of large orders by our
customers; |
· |
the
cyclical nature of demand for our customers'
products; |
· |
our
ability to develop new process technologies and achieve volume production
at our fabrication facilities; |
· |
changes
in manufacturing yields; |
· |
adverse
movements in exchange rates, interest rates or tax rates;
and |
· |
the
availability of adequate supply commitments from our outside suppliers or
subcontractors. |
· |
use
a significant portion of our available
cash; |
· |
issue
equity securities, which would dilute current stockholders’ percentage
ownership; |
· |
incur
substantial debt; |
· |
incur
or assume contingent liabilities, known or
unknown; |
· |
incur
amortization expenses related to intangibles;
and |
· |
incur
large, immediate accounting write-offs. |
· |
unexpected
losses of key employees or customers of the acquired
company; |
· |
bringing
the acquired company's standards, processes, procedures and controls into
conformance with our operations; |
· |
coordinating
our new product and process development; |
· |
hiring
additional management and other critical
personnel; |
· |
increasing
the scope, geographic diversity and complexity of our
operations; |
· |
difficulties
in consolidating facilities and transferring processes and
know-how; |
· |
diversion
of management's attention from other business concerns;
and |
· |
adverse
effects on existing business relationships with
customers. |
|
A. |
The
Company’s headquarters and product distribution center is located in an
industrial building at 3050 East Hillcrest Drive, Westlake Village, CA
91362 USA, and consists of approximately 30,900 square feet. The Company
is the primary lessee under a lease that has been extended five years and
expires in 2006, at an amount of approximately $30,000 per month, with a
5-year option. | |
B. |
Regional
sales offices located in the U.S., leased at less than $1,000 per month,
at the following locations: | ||
1. |
One
Overlook Drive, Suite 8, Amherst, NH 03031 | ||
2. |
160-D
East Wend, Lemont, IL 60439 | ||
3. |
18430
Brookhurst Street, Suite 201A, Fountain Valley, CA
92708 | ||
4. |
199
Route 13, Brookline, NH 03033 | ||
C.
|
Industrial premises consisting of approximately
9,000 square feet and located at 5Fl. 501-16 Chung-Cheng Road, Hsin-Tien
City, Taipei, Taiwan, Republic of China. These premises, owned by
Diodes-Taiwan, are used as a warehousing facility. | ||
D.
|
Industrial premises consisting of approximately
7,000 square feet and located at 2Fl. 501-15 Chung-Cheng Road, Hsin-Tien
City, Taipei, Taiwan, Republic of China. These premises, owned by
Diodes-Taiwan, are used as sales and administrative
offices. |
E. |
Industrial
building located at No. 999 Chen Chun Road, Xingqiao Town, Songjiang
County, Shanghai, People’s Republic of China. This building, consisting of
approximately 13,500 square meters, is the product distribution and
manufacturing facility for Diodes-China. The building is under a lease
that expires in 2017 from a company owned by the 5% joint venture partner
at a monthly rate of approximately $39,000 per month. | ||
|
|||
F. |
Regional
offices located in Mainland China, leased at less than $2,000 per month,
at the following locations: | ||
1. |
Room
508, 1158 ChangNing Road, Shanghai, China | ||
2. |
Room
706, 7th Floor Cyber Tower B, TianAn Cyber Park, Futian District,
Shenzhen, China | ||
G. |
Industrial
building located at 777 N. Blue Parkway Suite 350, Lee's Summit, MO 64086
USA. Acquired in December 2000, Diodes-FabTech’s 5-inch wafer foundry
includes a 16,000 sq. ft. clean room within a 70,000 sq. ft. manufacturing
facility formerly owned by AT&T, under a lease that expires in 2009,
at an amount of approximately $120,000 per month. | ||
H. |
Industrial
building located at Number 102, 1st Floor, International Plaza, 20 Sheung
Yuet Road, Kowloon Bay, Kowloon, Hong Kong. These premises are leased from
Lite-On Semiconductor, Ltd. at a rate of approximately $3,000 per month,
and are used as sales, warehousing and logistics
offices. | ||
I. |
Sales
and administrative offices located at 22, Avenue Paul Séjourné F-31000
Toulouse, France, leased at less than $1,000 per month. | ||
J. |
Industrial
building located at Plant No. 1, Lane 18, San Zhuang Road, Songjiang
Export Zone, Shanghai, People’s Republic of China. This building,
consisting of approximately 6,900 square meters, is the product
distribution and manufacturing facility for Diodes-Shanghai. The building
is under a lease that expires in 2009 from a company owned by the 5% joint
venture partner at a monthly rate of approximately $24,000 per
month. |
Item
5. |
Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity
Securities. |
Calendar
Quarter
Ended |
Closing
Sales Price of
Common
Stock |
||||||
High |
Low |
||||||
First
quarter (through March 11) 2005 |
$ |
26.830 |
$ |
19.580 |
|||
Fourth
quarter 2004 |
29.233 |
21.597 |
|||||
Third
quarter 2004 |
25.860 |
16.830 |
|||||
Second
quarter 2004 |
24.800 |
20.450 |
|||||
First
quarter 2004 |
25.166 |
19.013 |
|||||
Fourth
quarter 2003 |
20.600 |
13.867 |
|||||
Third
quarter 2003 |
16.053 |
12.100 |
|||||
Second
quarter 2003 |
14.360 |
7.180 |
|||||
First
quarter 2003 |
8.200 |
6.367 |
(In
thousands, except per share data) |
||||||||||||||||
|
Year
Ended December 31, |
|||||||||||||||
Income
Statement Data |
2000 |
2001 |
2002 |
2003 |
2004 |
|||||||||||
Net
sales |
$ |
118,462 |
$ |
93,210 |
$ |
115,821 |
$ |
136,905 |
$ |
185,703 |
||||||
Gross
profit |
37,427 |
14,179 |
26,710 |
36,528 |
60,735 |
|||||||||||
Selling,
general and administrative expenses |
18,814 |
13,711 |
16,228 |
19,586 |
23,503 |
|||||||||||
Research
and development expenses |
141 |
592 |
1,472 |
2,049 |
3,422 |
|||||||||||
Loss
on sale and impairment of fixed assets |
— |
8 |
43 |
1,037 |
14 |
|||||||||||
Income
(loss) from operations |
18,472 |
(132 |
) |
8,967 |
13,856 |
33,796 |
||||||||||
Interest
expense, net |
940 |
2,074 |
1,183 |
860 |
637 |
|||||||||||
Other
income (expense) |
501 |
785 |
67 |
(5 |
) |
(418 |
) | |||||||||
Income
(loss) before taxes and minority interest |
18,033 |
(1,421 |
) |
7,851 |
12,991 |
32,741 |
||||||||||
Income
tax benefit (provision) |
(2,496 |
) |
1,769 |
(1,729 |
) |
(2,460 |
) |
(6,514 |
) | |||||||
Minority
interest in joint venture earnings |
(642 |
) |
(224 |
) |
(320 |
) |
(436 |
) |
(676 |
) | ||||||
Net
income |
14,895 |
124 |
5,802 |
10,095 |
25,551 |
|||||||||||
Earnings
per share (1): |
||||||||||||||||
Basic |
$ |
1.23 |
$ |
0.01 |
$ |
0.47 |
$ |
0.79 |
$ |
1.91 |
||||||
Diluted |
$ |
1.08 |
$ |
0.01 |
$ |
0.44 |
$ |
0.70 |
$ |
1.65 |
||||||
Number
of shares used in computation (1): |
||||||||||||||||
Basic |
12,107 |
12,216 |
12,277 |
12,731 |
13,404 |
|||||||||||
Diluted |
13,833 |
13,321 |
13,297 |
14,406 |
15,471 |
As
of December 31, |
||||||||||||||||
2000 |
2001 |
2002 |
2003 |
2004 |
||||||||||||
Balance
Sheet Data |
||||||||||||||||
Total
assets |
$ |
112,950 |
$ |
103,258 |
$ |
105,010 |
$ |
123,795 |
$ |
167,801 |
||||||
Working
capital |
17,291 |
19,798 |
20,830 |
27,154 |
49,571 |
|||||||||||
Long-term
debt, net of current portion |
15,997 |
21,164 |
12,583 |
6,750 |
11,347 |
|||||||||||
Stockholders’
equity |
51,253 |
51,124 |
57,679 |
71,450 |
112,148 |
2003 |
Revenue |
%
of
Total
Revenue |
2004 |
Revenue |
%
of
Total
Revenue |
|||||||||||
United
States |
$ |
41,593 |
30.4 |
United
States |
$ |
53,204 |
28.6 |
|||||||||
Taiwan |
38,087
|
27.8 |
Taiwan |
50,716
|
27.3 |
|||||||||||
China |
25,908
|
18.9 |
China |
44,311
|
23.9 |
|||||||||||
Korea |
14,455
|
10.6 |
Korea |
16,447
|
8.9 |
|||||||||||
All
Others |
16,862
|
12.3 |
All
Others |
21,025
|
11.3 |
|||||||||||
Total |
$ |
136,905 |
100 |
Total |
$ |
185,703 |
100 |
Percent
of Net Sales |
Percentage
Dollar Increase (Decrease) | ||||||||||||||||||||||||||||
Year
Ended December 31, |
Year
Ended December 31, | ||||||||||||||||||||||||||||
2000 |
2001 |
2002 |
2003 |
2004 |
‘00
to ‘01 |
‘01
to ‘02 |
‘02
to ‘03 |
‘03
to ‘04 |
|||||||||||||||||||||
Net
sales |
100.0
|
% |
100.0
|
% |
100.0
|
% |
100.0
|
% |
100.0
|
% |
(19.7)
|
% |
24.3
|
% |
18.2
|
% |
35.6
|
% | |||||||||||
Cost
of goods sold |
(67.8 |
) |
(84.8 |
) |
(76.9 |
) |
(73.3 |
) |
(67.3 |
) |
0.5 |
12.8 |
12.6 |
24.5 |
|||||||||||||||
Gross
profit |
32.2 |
15.2 |
23.1 |
26.7 |
32.7 |
(62.1 |
) |
88.4 |
36.8 |
66.3 |
|||||||||||||||||||
Operating
expenses
(1) |
(16.3 |
) |
(15.4 |
) |
(15.4 |
) |
(16.6 |
) |
(14.5 |
) |
(24.5 |
) |
24.0 |
27.8 |
18.8 |
||||||||||||||
Income
(loss) from operations |
15.9 |
(0.2 |
) |
7.7 |
10.1 |
18.2 |
(100.7 |
) |
6,893.2 |
54.5 |
143.9 |
||||||||||||||||||
Interest
expense, net |
(0.8 |
) |
(2.2 |
) |
(1.0 |
) |
(0.6 |
) |
(0.3 |
) |
120.6 |
(43.0 |
) |
(27.3 |
) |
(25.9 |
) | ||||||||||||
Other
income |
0.4 |
0.8 |
(0.1 |
) |
0.0 |
(0.2 |
) |
56.7 |
(91.5 |
) |
(107.5 |
) |
8,260.0 |
||||||||||||||||
Income
(loss) before taxes and minority
interest |
15.5 |
(1.6 |
) |
6.8 |
9.5 |
17.7 |
(107.9 |
) |
652.5 |
65.5 |
152.0 |
||||||||||||||||||
Income
tax benefit (provision) |
(2.2 |
) |
1.9 |
(1.5 |
) |
(1.8 |
) |
(3.5 |
) |
(29.1 |
) |
(2.3 |
) |
42.3 |
164.8 |
||||||||||||||
Minority
interest |
(0.6 |
) |
(0.2 |
) |
(0.3 |
) |
(0.3 |
) |
(0.4 |
) |
(65.1 |
) |
42.9 |
36.3 |
54.9 |
||||||||||||||
Net
income |
12.7 |
0.1 |
5.0 |
7.4 |
13.8 |
(99.2 |
) |
4,578.9 |
74.0 |
153.1 |
Payments
due by period (in thousands) |
||||||||||||||||
Contractual
Obligations |
Total |
Less
than
1
year |
1-3
years |
3-5
years |
More
than
5
years |
|||||||||||
Long-term
debt |
$ |
11,347 |
$ |
3,514 |
$ |
7,250 |
$ |
583 |
$ |
0 |
||||||
Capital
leases |
2,777 |
230 |
460 |
460 |
1,627 |
|||||||||||
Operating
leases |
13,498 |
3,461 |
6,420 |
3,617 |
0 |
|||||||||||
Purchase
obligations |
2,927 |
2,927 |
0 |
0 |
0 |
|||||||||||
Total
obligations |
$ |
30,549 |
$ |
10,132 |
$ |
14,130 |
$ |
4,660 |
$ |
1,627 |
Item
15. |
Exhibits
and Financial Statement Schedules |
||
(a) |
Financial
Statements and Schedules |
||
(1)
Financial statements: |
Page | ||
Independent
Auditors’ Report |
36 | ||
Consolidated
Balance Sheet at December31, 2003 and 2004 |
37
to 38 | ||
Consolidated
Statement of Income for the Years Ended December31, 2002, 2003, and
2004 |
39 | ||
Consolidated
Statement of Stockholders' Equity for the Years Ended December31, 2002,
2003, and 2004 |
40 | ||
Consolidated
Statement of Cash Flows for the Years Ended December 31, 2002, 2003, and
2004 |
41
to 42 | ||
Notes
to Consolidated Financial Statement |
43
to 61 |
(2)
Schedules: |
|||
Report
of Independent Accountants on Financial Statement Schedule |
62 | ||
Schedule
II -- Valuation and Qualifying Accounts |
63 | ||
Schedules
not listed above have been omitted because the information required to be
set forth therein is not applicable or is shown in the financial
statements and note thereto. | |||
(b) |
Exhibits |
||
The
exhibits listed on the Index to Exhibits at page 65 are filed as exhibits
or incorporated by reference to this Annual Report on Form
10-K. | |||
(c) |
Financial
Statements of Unconsolidated Subsidiaries and
Affiliates | ||
Not
Applicable. |
December
31, |
2003 |
2004 |
|||||
ASSETS |
|||||||
CURRENT
ASSETS |
|||||||
Cash |
$ |
12,847,000 |
$ |
18,970,000 |
|||
Accounts
receivable |
|||||||
Trade
Customers |
27,010,000
|
38,682,000
|
|||||
Related
parties |
3,938,000
|
5,526,000
|
|||||
30,948,000
|
44,208,000
|
||||||
Allowance
for doubtful accounts |
(375,000 |
) |
(432,000 |
) | |||
30,573,000
|
43,776,000
|
||||||
Inventories
|
16,164,000
|
22,238,000
|
|||||
Deferred
income taxes, current |
5,547,000
|
2,453,000
|
|||||
Prepaid
expenses and other |
2,256,000
|
4,243,000
|
|||||
Prepaid
income taxes |
446,000
|
406,000
|
|||||
Total
current assets |
67,833,000
|
92,086,000
|
|||||
PROPERTY,
PLANT AND EQUIPMENT,
net |
47,893,000
|
60,857,000
|
|||||
DEFERRED
INCOME TAXES, non-current |
1,816,000
|
7,970,000
|
|||||
OTHER
ASSETS |
|||||||
Goodwill |
5,090,000
|
5,090,000
|
|||||
Other |
1,163,000
|
1,798,000
|
|||||
Total
assets |
$ |
123,795,000 |
$ |
167,801,000 |
December
31, |
2003 |
2004 |
|||||
LIABILITIES
AND STOCKHOLDERS' EQUITY |
|||||||
CURRENT
LIABILITIES |
|||||||
Line
of credit |
$ |
8,488,000 |
$ |
6,167,000 |
|||
Accounts
payable |
|||||||
Trade |
14,029,000
|
17,274,000
|
|||||
Related
parties |
3,453,000
|
3,936,000
|
|||||
Accrued
liabilities |
8,715,000
|
11,459,000
|
|||||
Current
portion of long-term debt |
|||||||
Related
party |
2,500,000
|
2,500,000
|
|||||
Others |
3,333,000
|
1,014,000
|
|||||
Current
portion of capital lease obligations |
161,000
|
165,000
|
|||||
Total
current liabilities |
40,679,000
|
42,515,000
|
|||||
LONG-TERM
DEBT,
net of current portion |
|||||||
Related
party |
3,750,000
|
1,250,000
|
|||||
Others |
3,000,000
|
6,583,000
|
|||||
CAPITAL
LEASE OBLIGATIONS,
net of current portion |
2,334,000
|
2,172,000
|
|||||
MINORITY
INTEREST IN JOINT VENTURE |
2,582,000
|
3,133,000
|
|||||
STOCKHOLDERS'
EQUITY |
|||||||
Class
A convertible preferred stock - |
|||||||
par
value $1.00 per share; 1,000,000 |
|||||||
shares
authorized; no shares issued and outstanding |
— |
—
|
|||||
Common
stock - par value $0.66 2/3 per share; |
|||||||
30,000,000
shares authorized; 14,627,284 and 15,763,266 shares |
|||||||
issued
at 2003 and 2004, respectively |
6,502,000
|
7,260,000
|
|||||
Additional
paid-in capital |
11,192,000
|
24,765,000
|
|||||
Retained
earnings |
55,779,000
|
81,330,000
|
|||||
73,473,000
|
113,355,000
|
||||||
Less: |
|||||||
Treasury
stock - 1,613,508 shares of |
|||||||
common
stock, at cost |
1,782,000
|
1,782,000
|
|||||
Accumulated
other comprehensive loss (gain) |
241,000
|
(575,000 |
) | ||||
2,023,000
|
1,207,000
|
||||||
Total
stockholders' equity |
71,450,000
|
112,148,000
|
|||||
Total
liabilities and stockholders' equity |
$ |
123,795,000 |
$ |
167,801,000 |
|||
Years
ended December 31, |
2002 |
2003 |
2004 |
|||||||
NET
SALES |
$ |
115,821,000 |
$ |
136,905,000 |
$ |
185,703,000 |
||||
COST
OF GOODS SOLD |
89,111,000
|
100,377,000
|
124,968,000
|
|||||||
Gross
profit |
26,710,000
|
36,528,000
|
60,735,000
|
|||||||
OPERATING
EXPENSES |
||||||||||
Selling,
general and administrative |
16,228,000
|
19,586,000
|
23,503,000
|
|||||||
Research
and development |
1,472,000
|
2,049,000
|
3,422,000
|
|||||||
Impairment
of fixed assets |
—
|
1,000,000
|
—
|
|||||||
Loss
on disposal of fixed assets |
43,000
|
37,000
|
14,000
|
|||||||
Total
operating expenses |
17,743,000
|
22,672,000
|
26,939,000
|
|||||||
Income
from operations |
8,967,000
|
13,856,000
|
33,796,000
|
|||||||
OTHER
INCOME (EXPENSES) |
||||||||||
Interest
expense, net |
(1,183,000 |
) |
(860,000 |
) |
(637,000 |
) | ||||
Other |
67,000
|
(5,000 |
) |
(418,000 |
) | |||||
Total
other income (expenses) |
(1,116,000 |
) |
(865,000 |
) |
(1,055,000 |
) | ||||
Income
before income taxes |
||||||||||
and
minority interest |
7,851,000
|
12,991,000
|
32,741,000
|
|||||||
INCOME
TAX PROVISION |
(1,729,000 |
) |
(2,460,000 |
) |
(6,514,000 |
) | ||||
Income
before minority interest |
6,122,000
|
10,531,000
|
26,227,000
|
|||||||
MINORITY
INTEREST IN EARNINGS |
||||||||||
OF
JOINT VENTURE |
(320,000 |
) |
(436,000 |
) |
(676,000 |
) | ||||
NET
INCOME |
$ |
5,802,000 |
$ |
10,095,000 |
$ |
25,551,000 |
||||
EARNINGS
PER SHARE |
||||||||||
Basic |
$ |
0.47 |
$ |
0.79 |
$ |
1.91 |
||||
Diluted |
$ |
0.44 |
$ |
0.70 |
$ |
1.65 |
||||
Number
of shares used in computation |
||||||||||
Basic |
12,276,899
|
12,730,808
|
13,404,276
|
|||||||
Diluted |
13,297,490
|
14,406,054
|
15,471,438
|
|||||||
Years
ended December 31, 2002, 2003, and 2004 |
Common
stock |
|||||||||||||||||||||||||
Shares |
Shares
in Treasury |
Amount |
|
Common
stock in treasury |
|
Additional
paid-in capital |
|
Retained
earnings |
|
Accumulated
other comprehensive gain (loss) |
|
Total |
|||||||||||||
BALANCE, | |||||||||||||||||||||||||
December
31, 2001 |
13,841,496
|
1,613,508
|
$ |
6,151,000 |
$ |
(1,782,000 |
) |
$ |
7,310,000 |
$ |
39,882,000 |
$ |
(437,000 |
) |
$ |
51,124,000 |
|||||||||
Comprehensive
income, net of tax: |
|||||||||||||||||||||||||
Net
income for the year |
|||||||||||||||||||||||||
ended
December 31, 2002 |
5,802,000
|
5,802,000
|
|||||||||||||||||||||||
Translation
adjustments |
(40,000 |
) |
(40,000 |
) | |||||||||||||||||||||
Change
in unrealized loss on |
|||||||||||||||||||||||||
derivative
instruments, |
|||||||||||||||||||||||||
net
of tax of $400 |
(1,000 |
) |
(1,000 |
) | |||||||||||||||||||||
Total
comprehensive income |
5,761,000
|
||||||||||||||||||||||||
Management
fee from LSC |
375,000
|
375,000
|
|||||||||||||||||||||||
Exercise
of stock options |
|||||||||||||||||||||||||
including
$98,000 income |
|||||||||||||||||||||||||
tax
benefit |
97,650
|
—
|
44,000
|
—
|
375,000
|
—
|
—
|
419,000
|
|||||||||||||||||
BALANCE, |
|||||||||||||||||||||||||
December
31, 2002 |
13,939,146
|
1,613,508
|
$ |
6,195,000 |
$ |
(1,782,000 |
) |
$ |
8,060,000 |
$ |
45,684,000 |
$ |
(478,000 |
) |
$ |
57,679,000 |
|||||||||
Comprehensive
income, net of tax: |
|||||||||||||||||||||||||
Net
income for the year |
|||||||||||||||||||||||||
ended
December 31, 2003 |
10,095,000
|
10,095,000
|
|||||||||||||||||||||||
Translation
adjustments |
169,000
|
169,000
|
|||||||||||||||||||||||
Change
in unrealized loss on |
|||||||||||||||||||||||||
derivative
instruments, |
|||||||||||||||||||||||||
net
of tax of $27,000 |
68,000
|
68,000
|
|||||||||||||||||||||||
Total
comprehensive income |
10,332,000
|
||||||||||||||||||||||||
Management
fee from LSC |
286,000
|
286,000
|
|||||||||||||||||||||||
Exercise
of stock options |
|||||||||||||||||||||||||
including
$1,139,000 income |
|||||||||||||||||||||||||
tax
benefit |
688,138
|
—
|
307,000
|
—
|
2,846,000
|
—
|
—
|
3,153,000
|
|||||||||||||||||
BALANCE, |
|||||||||||||||||||||||||
December
31, 2003 |
14,627,284
|
1,613,508
|
$ |
6,502,000 |
$ |
(1,782,000 |
) |
$ |
11,192,000 |
$ |
55,779,000 |
$ |
(241,000 |
) |
$ |
71,450,000 |
|||||||||
Comprehensive
income, net of tax: |
|||||||||||||||||||||||||
Net
income for the year |
|||||||||||||||||||||||||
ended
December 31, 2004 |
25,551,000
|
25,551,000
|
|||||||||||||||||||||||
Translation
adjustments |
793,000
|
793,000
|
|||||||||||||||||||||||
Change
in unrealized loss on |
|||||||||||||||||||||||||
derivative
instruments, |
|||||||||||||||||||||||||
net
of tax of $9,000 |
23,000
|
23,000
|
|||||||||||||||||||||||
Total
comprehensive income |
26,367,000
|
||||||||||||||||||||||||
Management
fee from LSC |
180,000
|
180,000
|
|||||||||||||||||||||||
Exercise
of stock options |
|||||||||||||||||||||||||
including
$8,514,000 income |
|||||||||||||||||||||||||
tax
benefit |
1,135,982
|
—
|
758,000
|
—
|
13,393,000
|
—
|
—
|
14,151,000
|
|||||||||||||||||
BALANCE, |
|||||||||||||||||||||||||
December
31, 2004 |
15,763,266
|
1,613,508
|
$ |
7,260,000 |
$ |
(1,782,000 |
) |
$ |
24,765,000 |
$ |
81,330,000 |
$ |
575,000 |
$ |
112,148,000 |
Years
ended December 31, |
2002 |
2003 |
2004 |
|||||||
CASH
FLOWS FROM OPERATING ACTIVITIES |
||||||||||
Net
income |
$ |
5,802,000 |
$ |
10,095,000 |
$ |
25,551,000 |
||||
Adjustments
to reconcile net income to net cash |
||||||||||
provided
by operating activities: |
||||||||||
Depreciation
and amortization |
9,747,000
|
11,073,000
|
13,173,000
|
|||||||
Minority
interest earnings |
320,000
|
436,000
|
676,000
|
|||||||
Loss
on impairment and disposal of property, plant and
equipment |
43,000
|
1,037,000
|
14,000
|
|||||||
Changes
in operating assets and liabilities |
||||||||||
Accounts
receivable |
(4,779,000 |
) |
(8,490,000 |
) |
(13,203,000 |
) | ||||
Inventories |
2,139,000
|
(1,248,000 |
) |
(6,074,000 |
) | |||||
Prepaid
expenses and other |
(711,000 |
) |
(388,000 |
) |
(2,474,000 |
) | ||||
Deferred
income taxes |
646,000
|
270,000
|
5,463,000
|
|||||||
Accounts
payable |
3,153,000
|
5,082,000
|
3,728,000
|
|||||||
Accrued
liabilities |
3,481,000
|
—
|
1,468,000
|
|||||||
Income
taxes payable |
149,000
|
954,000
|
978,000
|
|||||||
Net
cash provided by operating activities |
19,990,000
|
18,821,000
|
29,300,000
|
|||||||
CASH
FLOWS FROM INVESTING ACTIVITIES |
||||||||||
Purchases
of property, plant and equipment |
(6,777,000 |
) |
(15,646,000 |
) |
(26,201,000 |
) | ||||
Proceeds
from sales of property, plant and equipment |
3,000
|
357,000
|
68,000
|
|||||||
Net
cash used by investing activities |
(6,774,000 |
) |
(15,289,000 |
) |
(26,133,000 |
) | ||||
CASH
FLOWS FROM FINANCING ACTIVITIES |
||||||||||
Advances
(repayments) on line of credit, net |
(3,478,000 |
) |
5,463,000
|
(2,321,000 |
) | |||||
Net
proceeds from the issuance of common stock |
321,000
|
2,014,000
|
5,628,000
|
|||||||
Management
incentive reimbursement from LSC |
375,000
|
375,000
|
375,000
|
|||||||
Proceeds
from long-term debt |
—
|
—
|
3,583,000
|
|||||||
Repayments
of long-term debt |
(11,080,000 |
) |
(5,833,000 |
) |
(4,819,000 |
) | ||||
Minority
shareholder investment in subsidiary |
—
|
—
|
175,000
|
|||||||
Repayments
of capital lease obligations |
(133,000 |
) |
(157,000 |
) |
(158,000 |
) | ||||
Dividend
to minority shareholder |
—
|
—
|
(300,000 |
) | ||||||
Net
cash provided (used) by financing activities |
(13,995,000 |
) |
1,862,000
|
2,163,000
|
||||||
EFFECT
OF EXCHANGE RATE CHANGES |
||||||||||
ON
CASH AND CASH EQUIVALENTS |
(40,000 |
) |
169,000
|
793,000
|
||||||
INCREASE
(DECREASE) IN CASH |
(819,000 |
) |
5,563,000
|
6,123,000
|
||||||
CASH,
beginning of year |
8,103,000
|
7,284,000
|
12,847,000
|
|||||||
CASH,
end of year |
$ |
7,284,000 |
$ |
12,847,000 |
$ |
18,970,000 |
||||
Years
ended December 31, |
2002 |
2003 |
2004 |
|||||||
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION |
||||||||||
Cash
paid during the year for: |
||||||||||
Interest |
$ |
1,229,000 |
$ |
876,000 |
$ |
683,000 |
||||
Income
taxes |
$ |
965,000 |
$ |
999,000 |
$ |
2,504,000 |
||||
Non-cash
activities: |
||||||||||
Tax
benefit related to stock options |
||||||||||
credited
to paid-in capital |
$ |
98,000 |
$ |
1,139,000 |
$ |
8,514,000 |
||||
Building
acquired through capital lease obligation |
$ |
2,785,000 |
$ |
— |
$ |
— |
Year
Ended December 31 |
||||||||||
2002 |
2003 |
2004 |
||||||||
Net
income for earnings |
||||||||||
per
share computation |
$ |
5,802,000 |
$ |
10,095,000 |
$ |
25,551,000 |
||||
Basic |
||||||||||
Weighted
average number of common |
||||||||||
shares
oustanding during the year |
12,276,899
|
12,730,808
|
13,404,276
|
|||||||
Basic
earnings per share |
$ |
0.47 |
$ |
0.79 |
$ |
1.91 |
||||
Diluted |
||||||||||
Weighted
average number of common |
||||||||||
shares
outstanding used in calculating |
||||||||||
basic
earnings per share |
12,276,899
|
12,730,808
|
13,404,276
|
|||||||
Add:
additional shares issuable upon |
||||||||||
exercise
of stock options |
1,020,591
|
1,675,246
|
2,067,162
|
|||||||
Weighted
average number of common |
||||||||||
shares
used in calculating |
||||||||||
diluted
earnings per share |
13,297,490
|
14,406,054
|
15,471,438
|
|||||||
Diluted
earnings per share |
$ |
0.44 |
$ |
0.70 |
$ |
1.65 |
||||
For
the years ended December 31, |
||||||||||||||||||||||||||||
Amounts
Per Share |
Amounts
Per Share |
Amounts
Per Share |
||||||||||||||||||||||||||
2002 |
Basic |
Diluted |
2003 |
Basic |
Diluted |
2004 |
Basic |
Diluted |
||||||||||||||||||||
Net
income |
$ |
5,802,000 |
$ |
0.47 |
$ |
0.44 |
$ |
10,095,000 |
$ |
0.79 |
$ |
0.70 |
$ |
25,551,000 |
$ |
1.91 |
$ |
1.65 |
||||||||||
Deduct:
stock-based compensation |
||||||||||||||||||||||||||||
expense
determined under fair value |
||||||||||||||||||||||||||||
method,
net of tax |
(1,918,000 |
) |
(0.15 |
) |
(0.15 |
) |
(1,397,000 |
) |
(0.11 |
) |
(0.10 |
) |
(1,642,000 |
) |
(0.13 |
) |
(0.10 |
) | ||||||||||
Pro
forma net income |
$ |
3,884,000 |
$ |
0.32 |
$ |
0.29 |
$ |
8,698,000 |
$ |
0.68 |
$ |
0.60 |
$ |
23,909,000 |
$ |
1.78 |
$ |
1.55 |
||||||||||
Risk-free |
|
Expected
|
Expected
|
Expected
|
||||||||||||
December
31, |
|
interest
rate |
|
Expected
life |
|
volatility |
|
forfeitures |
|
dividends |
||||||
2004 |
|
|
3.64% |
|
|
5.0
years |
|
|
68.36% |
|
|
2.64% |
|
|
0% |
|
2003 |
|
|
3.31% |
|
|
5.0
years |
|
|
66.18% |
|
|
2.77% |
|
|
0% |
|
2002 |
|
|
4.03% |
|
|
5.0
years |
|
|
75.61% |
|
|
2.77% |
|
|
0% |
|
|
|
|
|
|
|
|||||||||||
2003 |
2004 |
||||||
Finished
goods |
$ |
9,920,000 |
$ |
13,118,000 |
|||
Work-in-progress |
1,818,000
|
2,025,000
|
|||||
Raw
materials |
6,519,000
|
9,240,000
|
|||||
18,257,000
|
24,383,000
|
||||||
Less:
reserves |
(2,093,000 |
) |
(2,145,000 |
) | |||
$ |
16,164,000 |
$ |
22,238,000 |
||||
2003 |
2004 |
||||||
Buildings
and leasehold improvements |
$ |
5,894,000 |
$ |
7,126,000 |
|||
Construction
in-progress |
2,810,000
|
2,989,000
|
|||||
Machinery
and equipment |
74,171,000
|
90,151,000
|
|||||
82,875,000
|
100,266,000
|
||||||
Less:
Accumulated depreciation |
|||||||
and
amortization |
(35,244,000 |
) |
(39,671,000 |
) | |||
47,631,000
|
60,595,000
|
||||||
Land |
262,000
|
262,000
|
|||||
$ |
47,893,000 |
$ |
60,857,000 |
||||
2004 |
Outstanding
at December 31, | |||||||||
Credit
Facility |
Terms |
2003 |
2004 |
|||||||
$
7,500,000 |
Revolving,
collateralized by all assets, variable interest (prime rate, approximately
5.25% at December 31, 2004) due monthly |
$ |
5,782,000 |
$ |
3,167,000 |
|||||
$
5,000,000 |
Term
loan, collateralized by all assets, variable interest (LIBOR + variable
margin, approximately 3.8% at December 31, 2004) due
monthly |
3,333,000
|
4,597,000
|
|||||||
$
25,000,000 |
Unsecured,
interest at LIBOR plus margin (approximately 2.3% at December 31, 2004)
due quarterly |
3,000,000
|
6,000,000
|
|||||||
$
8,960,000 |
Unsecured,
variable interest plus margin (approximately 1.7% to 2.3% at December 31,
2003) due monthly |
2,706,000
|
—
|
|||||||
$
46,460,000 |
14,821,000
|
13,764,000
|
||||||||
Less:
Long-term debt, net of Related Party (included in table
below) |
(6,333,000 |
) |
(7,597,000 |
) | ||||||
Line
of credit |
$ |
8,488,000 |
$ |
6,167,000 |
2003 |
2004 |
||||||
Note
payable to
LSC, a major stockholder of the Company (see Note 10), due in equal
monthly installments of $208,000 plus interest beginning July 31, 2002,
through June 30, 2006. The unsecured note bears interest at LIBOR plus 2%
(approximately 4.1% at December 31, 2004) and is subordinated to the
interest of the Company's primary lender. |
$ |
6,250,000 |
$ |
3,750,000 |
|||
Term
note portion of
$25,000,000 China credit facility due in 2006. |
3,000,000
|
3,000,000
|
|||||
Note
payable to
U.S. bank, collateralized by all assets, due in aggregate monthly
principal payments of $278,000 plus interest at 6.8% fixed by hedge
contract through November 2004. |
3,333,000
|
—
|
|||||
Note
payable to
U.S. bank, collateralized by all assets, due in aggregate monthly
principal payments of $83,000 plus interest at approximately 3.8% at
December 31, 2004. |
—
|
4,597,000
|
|||||
12,583,000
|
11,347,000
|
||||||
Less:
Current portion |
(5,833,000 |
) |
(3,514,000 |
) | |||
Long-term
debt,
net of current portion |
$ |
6,750,000 |
$ |
7,833,000 |
2005 |
$ |
3,514,000
|
||
2006 |
5,250,000
|
|||
2007 |
1,000,000
|
|||
2008 |
1,000,000
|
|||
2009 |
583,000
|
|||
$ |
11,347,000 |
For
years ending December 31, |
||||
2005 |
$ |
230,000 |
||
2006 |
230,000
|
|||
2007 |
230,000
|
|||
2008 |
230,000
|
|||
2009 |
230,000
|
|||
Thereafter |
1,627,000
|
|||
|
2,777,000
|
|||
Less:
Interest |
(440,000 |
) | ||
Present
value of minimum lease payments |
2,337,000
|
|||
|
||||
Less:
Current portion |
(165,000 |
) | ||
Long-term
portion |
$ |
2,172,000 |
||
2003 |
2004 |
||||||
Employee
compensation and payroll taxes |
$ |
4,501,000 |
$ |
5,779,000 |
|||
Equipment
purchases |
1,875,000
|
2,012,000
|
|||||
Taxes
payable |
—
|
978,000
|
|||||
Sales
commissions |
686,000
|
437,000
|
|||||
Refunds
to product distributors |
334,000
|
219,000
|
|||||
Other |
1,319,000
|
2,034,000
|
|||||
$ |
8,715,000 |
$ |
11,459,000 |
||||
2002 |
2003 |
2004 |
||||||||
Current
tax provision |
||||||||||
Federal |
$ |
— |
$ |
1,167,000 |
$ |
4,922,000 |
||||
Foreign |
1,231,000
|
1,183,000
|
4,745,000
|
|||||||
State |
1,000
|
40,000
|
461,000
|
|||||||
1,232,000
|
2,390,000
|
10,128,000
|
||||||||
Deferred
tax expense (benefit) |
497,000
|
70,000
|
(3,614,000 |
) | ||||||
Total
income tax provision |
$ |
1,729,000 |
$ |
2,460,000 |
$ |
6,514,000 |
||||
2002 |
2003 |
2004 |
|||||||||||||||||
Percent |
Percent |
Percent |
|||||||||||||||||
of
pretax |
of
pretax |
of
pretax |
|||||||||||||||||
Amount |
earnings |
Amount |
earnings |
Amount |
earnings |
||||||||||||||
Federal
tax |
$ |
2,669,000 |
34.0
|
$ |
4,417,000 |
34.0
|
$ |
11,131,000 |
34.0
|
||||||||||
State
franchise tax, |
|||||||||||||||||||
net
of Federal benefit |
455,000
|
5.8
|
753,000
|
5.8
|
1,588,000
|
4.8
|
|||||||||||||
Foreign
income tax rate difference |
(1,409,000 |
) |
(18.0 |
) |
(2,808,000 |
) |
(21.6 |
) |
(6,629,000 |
) |
(20.2 |
) | |||||||
Other |
14,000
|
0.2
|
98,000
|
0.8
|
424,000
|
1.3
|
|||||||||||||
Income
tax provision (benefit) |
$ |
1,729,000 |
22.0
|
$ |
2,460,000 |
19.0
|
$ |
6,514,000 |
19.9
|
2003 |
2004 |
||||||
Deferred
tax assets, current |
|||||||
Inventory
cost |
$ |
272,000 |
$ |
364,000 |
|||
Accrued
expenses and accounts receivable |
566,000
|
702,000
|
|||||
Net
operating loss carryforwards, foreign tax credits and
other |
4,709,000
|
1,387,000
|
|||||
$ |
5,547,000 |
$ |
2,453,000 |
||||
Deferred
tax assets, non-current |
|||||||
Plant,
equipment and intangible assets |
$ |
(2,380,000 |
) |
$ |
(2,632,000 |
) | |
Net
operating loss carryforwards, foreign tax credits and
other |
4,196,000
|
10,602,000
|
|||||
$ |
1,816,000 |
$ |
7,970,000 |
Outstanding
Options |
||||||||||
Exercise
Price Per Share |
||||||||||
Number |
Range |
Weighted
Average |
||||||||
Balance,
December 31, 2001 |
3,172,641
|
$ |
0.83-15.94 |
$ |
5.85 |
|||||
Granted
|
515,550
|
5.69-6.38
|
5.72
|
|||||||
Exercised |
(97,650 |
) |
0.83-5.55
|
3.28
|
||||||
Canceled |
(5,400 |
) |
5.55-5.69
|
5.62
|
||||||
Balance,
December 31, 2002 |
3,585,141
|
0.83-15.94
|
5.90
|
|||||||
Granted
|
502,950
|
10.63-13.04
|
13.03
|
|||||||
Exercised |
(688,141 |
) |
0.83-15.94
|
2.93
|
||||||
Canceled |
(15,325 |
) |
5.55-15.94
|
7.84
|
||||||
Balance,
December 31, 2003 |
3,384,625
|
2.22-15.94
|
7.56
|
|||||||
Granted
|
526,900
|
18.32-21.85
|
18.35
|
|||||||
Exercised |
(1,136,725 |
) |
2.22-15.94
|
4.96
|
||||||
Canceled |
(35,600 |
) |
5.55-18.32
|
13.64
|
||||||
Balance,
December 31, 2004 |
2,739,200
|
$ |
2.22-21.85 |
$ |
10.63 |
|||||
Range
of exercise prices |
|
Number
outstanding |
|
Weighted
average remaining contractual life (yrs) |
|
Weighted
average exercise price |
|||||||
'93
NQO |
$ |
2.67-15.94 |
631,950
|
4.6
|
$ |
9.42 |
|||||||
'93
ISO |
2.22-15.94 |
705,400
|
4.9
|
7.45 |
|||||||||
'01
Plan |
4.77-21.85 |
1,401,850
|
8.6
|
12.77 |
|||||||||
Total |
$ |
2.22-21.85 |
2,739,200
|
6.7
|
$ |
10.63 |
|||||||
Range
of exercise |
Number
|
Weighted
average |
||||||||
|
|
prices |
|
exercisable |
|
exercise
price |
||||
'93
NQO |
$ |
2.67-15.94 |
630,300 |
$ |
9.43 |
|||||
'93
ISO |
2.22-15.94 |
668,550 |
$ |
7.53 |
||||||
'01
Plan |
5.55-13.04 |
438,350 |
$ |
8.09 |
||||||
Total |
$ |
2.22-15.94 |
1,737,200 |
$ |
8.36 |
|||||
2002 |
2003 |
2004 |
||||||||
Net
sales |
$ |
16,147,000 |
$ |
14,628,000 |
$ |
20,675,000 |
||||
Purchases |
14,292,000
|
18,667,000
|
22,368,000
|
|||||||
2002 |
2003 |
2004 |
||||||||
Net
sales |
$ |
1,885,000 |
$ |
1,484,000 |
$ |
1,677,000 |
||||
Purchases |
4,394,000
|
2,961,000
|
4,789,000
|
|||||||
|
2003 |
2004 |
||||||
Accounts
receivable |
|||||||
LSC |
$ |
3,111,000 |
$ |
4,180,000 |
|||
Other |
827,000
|
1,346,000
|
|||||
$ |
3,938,000 |
$ |
5,526,000 |
||||
Accounts
payable |
|||||||
LSC |
$ |
2,914,000 |
$ |
3,308,000 |
|||
Other |
539,000
|
628,000
|
|||||
$ |
3,453,000 |
$ |
3,936,000 |
||||
Asia |
U.S.A. |
Consolidated |
||||||||
2004 |
||||||||||
Total
sales |
$ |
185,308,000 |
$ |
92,634,000 |
$ |
277,942,000 |
||||
Intercompany
sales |
(75,527,000 |
) |
(16,712,000 |
) |
(92,239,000 |
) | ||||
Net
sales |
$ |
109,781,000 |
$ |
75,922,000 |
$ |
185,703,000 |
||||
Assets |
$ |
116,729,000 |
$ |
51,072,000 |
$ |
167,801,000 |
||||
Property,
plant & equipment, net |
48,589,000
|
12,268,000
|
60,857,000
|
|||||||
2003 |
||||||||||
Total
sales |
$ |
124,412,000 |
$ |
72,188,000 |
$ |
196,600,000 |
||||
Intercompany
sales |
(48,378,000 |
) |
(11,317,000 |
) |
(59,695,000 |
) | ||||
Net
sales |
$ |
76,034,000 |
$ |
60,871,000 |
$ |
136,905,000 |
||||
Assets |
$ |
82,142,000 |
$ |
41,653,000 |
$ |
123,795,000 |
||||
Property,
plant & equipment, net |
35,941,000
|
11,952,000
|
47,893,000
|
|||||||
2002 |
||||||||||
Total
sales |
$ |
95,081,000 |
$ |
66,338,000 |
$ |
161,419,000 |
||||
Intercompany
sales |
(39,592,000 |
) |
(6,006,000 |
) |
(45,598,000 |
) | ||||
Net
sales |
$ |
55,489,000 |
$ |
60,332,000 |
$ |
115,821,000 |
||||
Assets |
$ |
63,721,000 |
$ |
41,289,000 |
$ |
105,010,000 |
||||
Property,
plant & equipment, net |
32,313,000
|
12,380,000
|
44,693,000
|
|||||||
2005 |
$ |
3,461,000 |
||
2006 |
3,481,000
|
|||
2007 |
2,939,000
|
|||
2008 |
2,520,000
|
|||
2009 |
1,097,000
|
|||
|
$ |
13,498,000 |
Quarter
Ended |
|||||||||||||
Fiscal
2004 |
March
31 |
June
30 |
Sept.
30 |
Dec.
31 |
|||||||||
Net
sales |
$ |
41,435,000 |
$ |
47,017,000 |
$ |
49,364,000 |
$ |
47,887,000 |
|||||
Gross
profit |
12,750,000
|
15,028,000
|
16,746,000
|
16,211,000
|
|||||||||
Net
income |
4,856,000
|
6,123,000
|
7,242,000
|
7,330,000
|
|||||||||
Earnings
per share |
|||||||||||||
Basic |
$ |
0.37 |
$ |
0.46 |
$ |
0.54 |
$ |
0.53 |
|||||
Diluted |
0.32
|
0.40
|
0.47
|
0.47
|
|||||||||
|
Quarter
Ended |
||||||||||||
March 31 |
June
30 |
Sept.
30 |
Dec.
31 |
||||||||||
Fiscal
2003 |
|||||||||||||
Net
sales |
$ |
29,446,000 |
$ |
33,316,000 |
$ |
34,941,000 |
$ |
39,202,000 |
|||||
Gross
profit |
7,461,000
|
8,346,000
|
9,162,000
|
11,559,000
|
|||||||||
Net
income |
1,923,000
|
2,172,000
|
2,563,000
|
3,437,000
|
|||||||||
Earnings
per share |
|||||||||||||
Basic |
$ |
0.15 |
$ |
0.17 |
$ |
0.20 |
$ |
0.27 |
|||||
Diluted |
0.14
|
0.15
|
0.18
|
0.23
|
|||||||||
|
Quarter
Ended |
||||||||||||
|
|
|
March 31 |
|
|
June 30 |
|
|
Sept. 30 |
|
|
Dec. 31 |
|
Fiscal
2002 |
|||||||||||||
Net
sales |
$ |
26,924,000 |
$ |
29,946,000 |
$ |
30,287,000 |
$ |
28,664,000 |
|||||
Gross
profit |
4,345,000
|
7,098,000
|
7,862,000
|
7,405,000
|
|||||||||
Net
income |
208,000
|
1,564,000
|
1,767,000
|
2,263,000
|
|||||||||
Earnings
per share |
|||||||||||||
Basic |
$ |
0.02 |
$ |
0.13 |
$ |
0.14 |
$ |
0.18 |
|||||
Diluted |
0.02
|
0.12
|
0.13
|
0.17
|
|||||||||
COL
A |
COL
B |
COL
C |
COL
D |
COL
E |
|||||||||
|
Additions |
|
|
||||||||||
|
Balance
at |
charged |
|
Balance
at |
|||||||||
|
beginning |
to
costs & |
|
end
of |
|||||||||
Description |
|
of
period |
|
expenses |
|
Deductions |
period |
||||||
Year
ended December 31, |
|||||||||||||
2002 |
|||||||||||||
Allowance
for doubtful accounts |
$ |
343,000 |
$ |
45,000 |
$ |
35,000 |
$ |
353,000 |
|||||
Reserve
for slow moving and obsolete inventory |
2,376,000
|
1,086,000
|
1,562,000
|
1,900,000
|
|||||||||
2003 |
|||||||||||||
Allowance
for doubtful accounts |
$ |
353,000 |
$ |
75,000 |
$ |
53,000 |
$ |
375,000 |
|||||
Reserve
for slow moving and obsolete inventory |
1,900,000
|
1,356,000
|
1,163,000
|
2,093,000
|
|||||||||
2004 |
|||||||||||||
Allowance
for doubtful accounts |
$ |
375,000 |
$ |
68,000 |
$ |
11,000 |
$ |
432,000 |
|||||
Reserve
for slow moving and obsolete inventory |
2,093,000
|
982,000
|
930,000
|
2,145,000
|
|||||||||
DIODES INCORPORATED (Registrant) | ||
By: /s/ C.H. Chen | March 11, 2005 | |
C.H. CHEN | ||
President & Chief Executive Officer | ||
(Principal Executive Officer) | ||
By: /s/ Carl C. Wertz | March 11, 2005 | |
CARL C. WERTZ | ||
Chief Financial Officer, Treasurer, and Secretary | ||
(Principal Financial and Accounting Officer) |
/s/ Raymond Soong | /s/ C.H. Chen | ||
RAYMOND SOONG | C.H. CHEN | ||
Chairman of the Board of Directors | Director | ||
/s/ Michael R. Giordano | /s/ M.K. Lu | ||
MICHAEL R. GIORDANO | M.K. LU | ||
Director | Director | ||
/s/ Keh-Shew Lu | /s/ John M. Stich | ||
KEH-SHEW LU | JOHN M. STICH | ||
Director | Director | ||
/s/ Shing Mao | |||
SHING MAO | |||
Director | |||
Sequential | ||
Number |
Description |
Page Number |
3.1 |
Certificate
of Incorporation of Diodes Incorporated (the “Company”) dated July 29,
1968 (1) |
|
3.2 |
Amended
By-laws of the Company dated August 14, 1987 (2) |
|
3.3 |
Amended
Certificate of Incorporation of the Company dated June 12, 2000
(25) |
|
10.1 |
Stock
Purchase and Termination of Joint Shareholder Agreement (3) |
|
10.2 |
1994
Credit Facility Agreement between the Company and Wells Fargo Bank,
National Association (4) |
|
10.3
* |
Company’s
401(k) Plan - Adoption Agreement (5) |
|
10.4
* |
Company’s
401(k) Plan - Basic Plan Documentation #03 (5) |
|
10.5
* |
Employment
Agreement between the Company and Pedro Morillas (6) |
|
10.6
* |
Company’s
Incentive Bonus Plan (7) |
|
10.7
* |
Company’s
1982 Incentive Stock Option Plan (7) |
|
10.8
* |
Company’s
1984 Non-Qualified Stock Option Plan (7) |
|
10.9
* |
Company’s
1993 Non-Qualified Stock Option Plan (7) |
|
10.10
* |
Company’s
1993 Incentive Stock Option Plan (5) |
|
10.11 |
$6.0
Million Revolving Line of Credit Note (8) |
|
10.12 |
Credit
Agreement between Wells Fargo Bank and the Company dated November 1, 1995
(8) |
|
10.13 |
KaiHong
Compensation Trade Agreement for SOT-23 Product (9) |
|
10.14 |
KaiHong
Compensation Trade Agreement for MELF Product (10) |
|
10.15 |
Lite-On
Power Semiconductor Corporation Distributorship Agreement (11) |
|
10.16 |
Loan
Agreement between the Company and FabTech Incorporated (12) |
|
10.17 |
KaiHong
Joint Venture Agreement between the Company and Mrs. J.H. Xing
(12) |
|
10.18 |
Quality
Assurance Consulting Agreement between LPSC and Shanghai KaiHong
Electronics Company, Ltd. (13) |
|
10.19 |
Loan
Agreement between the Company and Union Bank of California, N.A.
(13) |
|
10.20 |
First
Amendment to Loan Agreement between the Company and Union Bank of
California, N.A. (14) |
|
10.21 |
Guaranty
Agreement between the Company and Shanghai KaiHong Electronics Co., Ltd.
(14) |
|
10.22 |
Guaranty
Agreement between the Company and Xing International, Inc. (14) |
|
10.23 |
Fifth
Amendment to Loan Agreement (15) |
|
10.24 |
Term
Loan B Facility Note (15) |
|
10.25 |
Bank
Guaranty for Shanghai KaiHong Electronics Co., LTD (16) |
|
10.26 |
Consulting
Agreement between the Company and J.Y. Xing (17) |
|
10.27 |
Software
License Agreement between the Company and Intelic
Software Solutions, Inc.
(18) |
|
10.28 |
Diodes-Taiwan
Relationship Agreement for FabTech Wafer Sales (19) |
|
10.29 |
Separation
Agreement between the Company and Michael A. Rosenberg (20) |
|
10.30 |
Stock
Purchase Agreement dated as of November 28, 2000, among Diodes
Incorporated, FabTech, Inc. and Lite-On Power Semiconductor Corporation
(24) |
|
10.31 |
Volume
Purchase Agreement dated as of October 25, 2000, between FabTech,
Inc. and Lite-On Power Semiconductor Corporation (24) |
|
10.32 |
Credit
Agreement dated as of December 1, 2000, between Diodes Incorporated
and Union Bank of California (24) |
|
10.33 |
Subordination
Agreement dated as of December 1, 2000, by Lite-On Power
Semiconductor Corporation in favor of Union Bank of California
(24) |
|
10.34 |
Subordinated
Promissory Note in the principal amount of $13,549,000 made by FabTech,
Inc. payable to Lite-On Power Semiconductor Corporation (24) |
|
10.35 |
Amended
and Restated Subordinated Promissory Note between FabTech, Inc. and
Lite-On Semiconductor Corp.
(26) |
|
10.36 |
Diodes
Incorporated Building Lease - Third Amendment (29) |
|
10.37 |
Document
of Understanding between the Company and Microsemi Corporation
(29) |
|
10.38 |
Swap
Agreement between the Company and Union Bank of California (30) |
|
10.39 |
First
Amendment and Waver between the Company and Union Bank of California
(30) |
|
10.40 |
Second
Amendment and Waver between the Company and Union Bank of California
(30) |
|
10.41 |
Banking
Agreement between Diodes-China and Everbright Bank of China (30) |
|
10.42 |
Banking
Agreement between Diodes-China and Agricultural Bank of China (30) |
|
10.43 |
Banking
Agreement between Diodes-Taiwan and Farmers Bank of China (30) |
|
10.44 |
Audit
Committee Charter (31) |
|
10.45 |
2001
Omnibus Equity Incentive Plan (31) |
|
10.46 |
Sale
and Leaseback Agreement between the Company and Shanghai Ding Hong
Company, Ltd.
(32) |
Sequential | ||
Number |
Description |
Page Number |
10.47 |
Lease
Agreement between the Company and Shanghai Ding Hong Company,
Ltd.
(32) |
|
10.48 |
Third
Amendment and Waiver to Union Bank Credit Agreement
(33) |
|
10.49 |
Revolving
Credit Extension between the Company and Union Bank
(34) |
|
10.50 |
Amended
and Restated Credit Agreement between the Company and Union Bank
(35) |
|
10.51 |
$2.0
Million Non Revolving-To-Term Note between the Company and Union Bank
(35) |
|
10.52 |
Lease
Agreement for Plant #2 between the Company and Shanghai Ding Hong
Electronic Equipment Limited (37) |
|
10.53 |
$5
Million Term Note with Union Bank (37) |
|
10.54 |
First
Amendment To Amended And Restated Credit Agreement (37) |
|
10.55 |
Covenant
Agreement between Union Bank and FabTech, Inc. (37) |
|
10.56 |
Amendment
to The Sale and Lease Agreement dated as January 31, 2002 with Shanghai
Ding Hong Electronic Co., Ltd. (37) |
|
10.57 |
Lease
Agreement between Diodes Shanghai and Shanghai Yuan Hao Electronic Co.,
Ltd. (37) |
|
10.58 |
Supplementary
to the Lease agreement dated as September 30, 2003 with Shanghai Ding Hong
Electronic Co., Ltd. (37) |
|
14 |
Code
of Ethics for Chief Executive Officer and Senior Financial Officers
(36) |
|
21 |
Subsidiaries
of the Registrant |
|
23.1 |
Consent
of Independent Public Accountants |
|
31.1 |
Certification
Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1943, adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
31.2 |
Certification
Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1943, adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
32.1 |
Certification
Pursuant to 18 U.S.C. adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 |
|
32.2 |
Certification
Pursuant to 18 U.S.C. adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 |
(1) | Previously filed as Exhibit 3 to Form 10-K filed with the Commission for fiscal year ended April 30, 1981, which is hereby incorporated by reference. |
(2) | Previously filed as Exhibit 3 to Form 10-K filed with the Commission for fiscal year ended April 30, 1988, which is hereby incorporated by reference. |
(3) | Previously filed with the Company’s Form 8-K, filed with the Commission on July 1, 1994, which is hereby incorporated by reference. |
(4) | Previously filed as Exhibit 10.4 to Form 10-KSB/A filed with the Commission for fiscal year ended December 31, 1993, which is hereby incorporated by reference. |
(5) | Previously filed with Company’s Form 10-K, filed with the Commission on March 31, 1995, which is hereby incorporated by reference. |
(6) | Previously filed as Exhibit 10.6 to Form 10-KSB filed with the Commission on August 2, 1994, for the fiscal year ended December 31, 1993, which is hereby incorporated by reference |
(7) | Previously filed with Company’s Form S-8, filed with the Commission on May 9, 1994, which is hereby incorporated by reference. |
(8) | Previously filed with Company’s Form 10-Q, filed with the Commission on November 14, 1995, which is hereby incorporated by reference. |
(9) | Previously filed as Exhibit 10.2 to Form 10-Q/A, filed with the Commission on October 27, 1995, which is hereby incorporated by reference. |
(10) | Previously filed as Exhibit 10.3 to Form 10-Q/A, filed with the Commission on October 27, 1995, which is hereby incorporated by reference. |
(11) | Previously filed as Exhibit 10.4 to Form 10-Q, filed with the Commission on July 27, 1995, which is hereby incorporated by reference. |
(12) | Previously filed with Company’s Form 10-K, filed with the Commission on April 1, 1996, which is hereby incorporated by reference. |
(13) | Previously filed with Company’s Form 10-Q, filed with the Commission on May 15, 1996, which is hereby incorporated by reference. |
(14) | Previously filed with Company’s Form 10-K, filed with the Commission on March 26, 1997, which is hereby incorporated by reference. |
(15) | Previously filed with Company’s Form 10-Q, filed with the Commission on May 11, 1998, which is hereby incorporated by reference. |
(16) | Previously filed with Company’s Form 10-Q, filed with the Commission on August 11, 1998, which is hereby incorporated by reference. |
(17) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on November 11,
1998, which is hereby incorporated by
reference. |
(18) |
Previously
filed with Company’s Form 10-K, filed with the Commission on March 26,
1999, which is hereby incorporated by
reference. |
(19) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on August 10,
1999, which is hereby incorporated by
reference. |
(20) |
Previously
filed with Company’s Form 10-K, filed with the Commission on March 28,
2000, which is hereby incorporated by
reference. |
(21) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on May 10, 2000,
which is hereby incorporated by reference. |
(22) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on August 4,
2000, which is hereby incorporated by
reference. |
(23) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on November 13,
2000, which is hereby incorporated by
reference. |
(24) |
Previously
filed with Company’s Form 8-K, filed with the Commission on December 14,
2000, which is hereby incorporated by
reference. |
(25) |
Previously
filed with Company’s Definitive Proxy Statement, filed with the Commission
on May 1, 2000, which is hereby incorporated by
reference. |
(26) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on August 7,
2001, which is hereby incorporated by
reference. |
(27) |
Previously
filed with Company’s Form 10-K, filed with the Commission on March 28,
2001, which is hereby incorporated by
reference. |
(28) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on May 11, 2001,
which is hereby incorporated by reference. |
(29) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on November 2,
2001, which is hereby incorporated by
reference. |
(30) |
Previously
filed with Company’s Form 10-K, filed with the Commission on March 31,
2002, which is hereby incorporated by
reference. |
(31) |
Previously
filed with Company’s Definitive Proxy Statement, filed with the Commission
on April 27, 2001, which is hereby incorporated by
reference. |
(32) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on May 15, 2002,
which is hereby incorporated by reference. |
(33) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on August 14,
2002, which is hereby incorporated by
reference. |
(34) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on November 14,
2002, which is hereby incorporated by
reference. |
(35) |
Previously
filed with Company’s Form 10-K, filed with the Commission on March 31,
2003, which is hereby incorporated by
reference. |
(36) |
Provided
in the Corporate Governance portion of the Investor Relations section on
the Company’s website at http://www.diodes.com, as well as incorporated by
reference to the Company’s definitive proxy statement (to
be filed pursuant to Regulation 14A within 120 days after the Company’s
fiscal year end of December 31, 2004) for its annual stockholders’ meeting
for 2005. |
(37) |
Previously
filed with Company’s Form 10-Q, filed with the Commission on August 9,
2004, which is hereby incorporated by
reference. |
/s/ C.H. Chen | ||
C. H. Chen | ||
Chief Executive Officer | ||
Date: March 11, 2005 |
/s/ Carl C. Wertz | ||
Carl C. Wertz | ||
Chief Financial Officer | ||
Date: March 11, 2005 |
Very truly yours, | ||
/s/ C.H. Chen | ||
C.H. Chen | ||
Chief Executive Officer | ||
Date: March 11, 2005 |
Very truly yours, | ||
/s/ Carl C. Wertz | ||
Carl C. Wertz | ||
Chief Financial Officer | ||
Date: March 11, 2005 |