Universal Electronics Reports Financial Results for the Third Quarter 2021

SCOTTSDALE, Ariz.--()--Universal Electronics Inc. (UEI) (NASDAQ: UEIC) reported financial results for the three and nine months ended September 30, 2021.

“We continue to see long-term demand for innovative home entertainment and automation control solutions,” said Paul Arling, UEI’s chairman and CEO. “However, macro-economic pressures have persisted. Although third quarter sales were impacted more than anticipated by shipping delays as well as ongoing component shortages, our product mix maintained strong gross margins. Our continued cost controls yielded a record bottom line for both the third quarter and nine months ended September 30, 2021.

“We are leveraging 35 plus years’ experience to navigate these immediate challenges. In the third quarter, we secured multiple design wins for control products in the HVAC and home automation channels. As is typical, these long-lived projects are awarded well ahead of shipping dates; therefore, related revenue is expected in late 2022 and 2023. Our goal is to replicate the success we’ve enjoyed in home entertainment, and we are excited to broaden our foothold in other channels. As always, our vision remains focused on our long-term global opportunity, and we are confident we have the technological innovation, operational prowess, and financial strength to lead the industry.”

Financial Results for the Three Months Ended September 30: 2021 Compared to 2020

  • GAAP net sales were $155.6 million, compared to $153.5 million; Adjusted Non-GAAP net sales were $155.7 million, compared to $153.7 million.
  • GAAP gross margins were 29.4%, compared to 28.8%; Adjusted Non-GAAP gross margins were 30.4%, compared to 30.0%.
  • GAAP operating income was $8.9 million, compared to $10.2 million; Adjusted Non-GAAP operating income was $16.7 million, compared to $17.0 million.
  • GAAP net loss was $1.0 million, or $0.07 per share, compared to net income of $6.2 million or $0.43 per diluted share; Adjusted Non-GAAP net income was $14.1 million, or $1.03 per diluted share, compared to $13.1 million, or $0.92 per diluted share.
  • At September 30, 2021, cash and cash equivalents were $58.8 million.

Financial Results for the Nine Months Ended September 30: 2021 Compared to 2020

  • GAAP net sales were $456.7 million, compared to $458.4 million; Adjusted Non-GAAP net sales were $457.1 million, compared to $458.9 million.
  • GAAP gross margins were 30.0%, compared to 27.3%; Adjusted Non-GAAP gross margins were 30.8%, compared to 29.8%.
  • GAAP operating income was $26.5 million, compared to $24.8 million; Adjusted Non-GAAP operating income was $48.2 million, compared to $46.5 million.
  • GAAP net income was $11.6 million, or $0.84 per diluted share, compared to $26.4 million or $1.86 per share; Adjusted Non-GAAP net income was $40.3 million, or $2.90 per diluted share, compared to $37.3 million, or $2.63 per diluted share.

Financial Outlook

For the fourth quarter of 2021, the company expects GAAP net sales to range between $143 million and $158 million, compared to $156.3 million in the fourth quarter of 2020. GAAP earnings per diluted share for the fourth quarter of 2021 are expected to range from $0.10 to $0.25, compared to a GAAP earnings per diluted share of $0.86 in the fourth quarter of 2020.

For the fourth quarter of 2021, the company expects Adjusted Non-GAAP net sales to range from $143 million to $158 million, compared to $156.4 million in the fourth quarter of 2020. Adjusted Non-GAAP earnings per diluted share are expected to range from $0.65 to $0.80, compared to Adjusted Non-GAAP earnings per diluted share of $1.14 in the fourth quarter of 2020. The fourth quarter 2021 Adjusted Non-GAAP earnings per diluted share estimate excludes $0.55 per share related to, among other things, excess manufacturing overhead costs, stock-based compensation, amortization of acquired intangibles, litigation costs, foreign currency gains and losses and the related tax impact of these adjustments. For a more detailed explanation of Non-GAAP measures, please see the Use of Non-GAAP Financial Metrics discussion and the Reconciliation of Adjusted Non-GAAP Financial Results, each located elsewhere in this press release.

The company continues to believe in its long-term growth targets of sales between 5% and 10% and EPS between 10% and 20%.

Conference Call Information

UEI’s management team will hold a conference call today, Thursday, November 4, 2021 at 4:30 p.m. ET / 1:30 p.m. PT, to discuss its third quarter 2021 earnings results, review recent activity and answer questions. To access the call in the U.S. please dial 877-843-0414, and for international calls dial 315-625-3071 approximately 15 minutes prior to the start of the conference. The conference ID is 8575919. The conference call will also be broadcast live on the investor section of the UEI website where it will be available for replay for one year. In addition, a replay will be available via telephone for two business days beginning two hours after the call. To listen to the replay, in the U.S. please dial 855-859-2056, and internationally dial 404-537-3406. The access code is 8575919.

Use of Non-GAAP Financial Metrics

In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, UEI provides Adjusted Non-GAAP information as additional information for its operating results. References to Adjusted Non-GAAP information are to non-GAAP financial measures. These measures are not required by, in accordance with, or an alternative for, GAAP and may be different from non-GAAP financial measures used by other companies. UEI’s management uses these measures for reviewing the financial results of UEI for budget planning purposes and for making operational and financial decisions. Management believes that providing these non-GAAP financial measures to investors, as a supplement to GAAP financial measures, help investors evaluate UEI’s core operating and financial performance and business trends consistent with how management evaluates such performance and trends. Additionally, management believes these measures facilitate comparisons with the core operating and financial results and business trends of competitors and other companies.

Adjusted Non-GAAP net sales is defined as net sales excluding the revenue impact of stock-based compensation for performance-based warrants. Adjusted Non-GAAP gross profit is defined as gross profit excluding the impact of additional Section 301 U.S. tariffs on products manufactured in China and imported into the U.S., excess manufacturing overhead costs, including those related to the COVID-19 pandemic, factory transition costs, loss on the sale of our Ohio call center, gain on the release from our Ohio call center lease obligation guarantee, stock-based compensation expense, depreciation expense related to the increase in fixed assets from cost to fair market value resulting from acquisitions and employee related restructuring costs. Adjusted Non-GAAP operating expenses are defined as operating expenses excluding stock-based compensation expense, amortization of intangibles acquired, changes in contingent consideration related to acquisitions, costs associated with our International Trade Commission litigation efforts, and employee related restructuring and other costs. Adjusted Non-GAAP net income is defined as net income excluding the aforementioned items, the loss on the sale of our Argentina subsidiary, the reversal of a social insurance accrual related to our Guangzhou entity, which was sold in 2018, foreign currency gains and losses, the related tax effects of all adjustments and the effect of a reversal of a reserve of an uncertain tax position related to our Guangzhou entity, which was sold in 2018. Adjusted Non-GAAP diluted earnings per share is calculated using Adjusted Non-GAAP net income. A reconciliation of these financial measures to the most directly comparable GAAP financial measures is included at the end of this press release.

About Universal Electronics

Founded in 1986, Universal Electronics Inc. (NASDAQ: UEIC) is the global leader in wireless universal control solutions for home entertainment and smart home devices. We design, develop, manufacture, ship and support control and sensor technology solutions and a broad line of universal control systems, audio video accessories, and intelligent wireless security and smart home products. Our products and solutions are used by the world's leading brands in the video services, consumer electronics, security, home automation, climate control and home appliance markets. For more information, visit www.uei.com.

Forward-looking Statements

This press release and accompanying schedules contain "forward-looking statements" within the meaning of federal securities laws, including net sales, profit margin and earnings trends, estimates and assumptions; our expectations about new product introductions; and similar statements concerning anticipated future events and expectations that are not historical facts. We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those we identify below and other risk factors that we identify in our most recent annual report on Form 10-K for the year ended December 31, 2020, and quarterly and periodic reports we have filed with the Securities Exchange Commission (the “SEC”) since then. Risks that could affect forward-looking statements in this press release include: our ability to continue anticipating the needs and wants of our customers, and timely develop and deliver products and technologies that will be accepted by our customers; the continued commitment of our customers to their product development strategies that translate into greater demand for our technologies and products as anticipated by management; the continued ordering pattern of our customers as anticipated by management; management's ability to manage its business to achieve its net sales, margins, and earnings through its operating efficiencies, product mix, and gross margin improvement initiatives as guided and as anticipated; our ability to manage our supply chain and logistics interruptions and delays; our ability to enhance and protect the value of our intellectual properties, including our patents and trade secrets, through our licensing and litigation efforts; the effects that natural disasters and public health crises, including the COVID-19 pandemic, have on our business and management’s ability to anticipate and mitigate those effects, including the duration, severity and scope of the COVID-19 pandemic, and the actions and restrictions that may be imposed on us and our operations by federal, state, local and international public health and governmental authorities to contain and combat the outbreak and spread of COVID-19, each of which may exacerbate one or more of the aforementioned risks; the impact to our business stemming from the recent press report and Senate inquiry regarding the Chinese work force used in one of our China factories; effects and uncertainties and other factors more fully described in our reports filed with the SEC; and effects that changes in or enhanced use of laws, regulations and policies may have on our business including the impact of trade regulations pertaining to importation of our products and the tariffs imposed upon them. Since it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future results, the above list should not be considered a complete list. Further, any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release. We make these forward-looking statements as of November 4, 2021, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

– Tables Follow –

UNIVERSAL ELECTRONICS INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share-related data)
(Unaudited)

 

 

September 30, 2021

 

December 31, 2020

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

58,825

 

 

$

57,153

 

Accounts receivable, net

 

139,894

 

 

129,433

 

Contract assets

 

9,173

 

 

9,685

 

Inventories

 

123,981

 

 

120,430

 

Prepaid expenses and other current assets

 

6,155

 

 

6,828

 

Income tax receivable

 

2,877

 

 

3,314

 

Total current assets

 

340,905

 

 

326,843

 

Property, plant and equipment, net

 

79,199

 

 

87,285

 

Goodwill

 

48,510

 

 

48,614

 

Intangible assets, net

 

20,695

 

 

19,710

 

Operating lease right-of-use assets

 

17,726

 

 

19,522

 

Deferred income taxes

 

4,345

 

 

5,564

 

Other assets

 

2,144

 

 

2,752

 

Total assets

 

$

513,524

 

 

$

510,290

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

85,635

 

 

$

83,229

 

Line of credit

 

53,000

 

 

20,000

 

Accrued compensation

 

24,982

 

 

28,931

 

Accrued sales discounts, rebates and royalties

 

7,035

 

 

10,758

 

Accrued income taxes

 

1,598

 

 

3,535

 

Other accrued liabilities

 

32,522

 

 

33,057

 

Total current liabilities

 

204,772

 

 

179,510

 

Long-term liabilities:

 

 

 

 

Operating lease obligations

 

11,948

 

 

13,681

 

Contingent consideration

 

 

 

292

 

Deferred income taxes

 

180

 

 

1,913

 

Income tax payable

 

1,054

 

 

1,054

 

Other long-term liabilities

 

332

 

 

539

 

Total liabilities

 

218,286

 

 

196,989

 

Commitments and contingencies

 

 

 

 

Stockholders’ equity:

 

 

 

 

Preferred stock, $0.01 par value, 5,000,000 shares authorized; none issued or outstanding

 

 

 

 

Common stock, $0.01 par value, 50,000,000 shares authorized; 24,627,589 and 24,391,595 shares issued on September 30, 2021 and December 31, 2020, respectively

 

246

 

 

244

 

Paid-in capital

 

311,964

 

 

302,084

 

Treasury stock, at cost, 11,476,672 and 10,618,002 shares on September 30, 2021 and December 31, 2020, respectively

 

(339,712)

 

 

(295,495)

 

Accumulated other comprehensive income (loss)

 

(13,881)

 

 

(18,522)

 

Retained earnings

 

336,621

 

 

324,990

 

Total stockholders’ equity

 

295,238

 

 

313,301

 

Total liabilities and stockholders’ equity

 

$

513,524

 

 

$

510,290

 

UNIVERSAL ELECTRONICS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2021

 

2020

 

2021

 

2020

Net sales

$

155,625

 

 

$

153,505

 

 

$

456,658

 

 

$

458,416

 

Cost of sales

109,805

 

 

109,349

 

 

319,777

 

 

333,244

 

Gross profit

45,820

 

 

44,156

 

 

136,881

 

 

125,172

 

Research and development expenses

7,411

 

 

7,696

 

 

23,029

 

 

22,979

 

Selling, general and administrative expenses

29,505

 

 

26,214

 

 

87,316

 

 

77,441

 

Operating income

8,904

 

 

10,246

 

 

26,536

 

 

24,752

 

Interest income (expense), net

(212)

 

 

(268)

 

 

(447)

 

 

(1,272)

 

Loss on sale of Argentina subsidiary

(6,050)

 

 

 

 

(6,050)

 

 

 

Accrued social insurance adjustment

 

 

 

 

 

 

9,464

 

Other income (expense), net

(157)

 

 

(1,646)

 

 

(151)

 

 

(1,263)

 

Income before provision for income taxes

2,485

 

 

8,332

 

 

19,888

 

 

31,681

 

Provision for income taxes

3,440

 

 

2,164

 

 

8,257

 

 

5,267

 

Net income (loss)

$

(955)

 

 

$

6,168

 

 

$

11,631

 

 

$

26,414

 

 

 

 

 

 

 

 

 

Earnings (loss) per share:

 

 

 

 

 

 

Basic

$

(0.07)

 

 

$

0.44

 

 

$

0.85

 

 

$

1.90

 

Diluted

$

(0.07)

 

 

$

0.43

 

 

$

0.84

 

 

$

1.86

 

Shares used in computing earnings per share:

 

 

 

 

 

 

 

Basic

13,392

 

13,928

 

13,622

 

13,935

 

Diluted

13,392

 

14,205

 

13,920

 

14,189

 

UNIVERSAL ELECTRONICS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

 

 

Nine Months Ended September 30,

 

 

2021

 

2020

Cash flows from operating activities:

 

 

 

 

Net income

 

$

11,631

 

 

$

26,414

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Depreciation and amortization

 

19,719

 

 

22,857

 

Provision for credit losses

 

1

 

 

271

 

Deferred income taxes

 

(483)

 

 

503

 

Shares issued for employee benefit plan

 

977

 

 

959

 

Employee and director stock-based compensation

 

7,516

 

 

6,854

 

Performance-based common stock warrants

 

398

 

 

525

 

Impairment of long-term assets

 

 

 

57

 

Loss on sale of Argentina subsidiary, net of cash transferred

 

5,960

 

 

 

Accrued social insurance adjustment

 

 

 

(9,464)

 

Loss on sale of Ohio call center

 

 

 

712

 

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable and contract assets

 

(12,129)

 

 

11,556

 

Inventories

 

(4,466)

 

 

30,466

 

Prepaid expenses and other assets

 

2,872

 

 

601

 

Accounts payable and accrued liabilities

 

(7,416)

 

 

(50,507)

 

Accrued income taxes

 

(1,664)

 

 

2,023

 

Net cash provided by operating activities

 

22,916

 

 

43,827

 

Cash flows from investing activities:

 

 

 

 

Acquisitions of property, plant and equipment

 

(8,782)

 

 

(10,864)

 

Acquisitions of intangible assets

 

(3,626)

 

 

(5,254)

 

Payment on sale of Ohio call center

 

 

 

(500)

 

Net cash used for investing activities

 

(12,408)

 

 

(16,618)

 

Cash flows from financing activities:

 

 

 

 

Borrowings under line of credit

 

71,000

 

 

70,000

 

Repayments on line of credit

 

(38,000)

 

 

(88,000)

 

Proceeds from stock options exercised

 

991

 

 

 

Treasury stock purchased

 

(44,217)

 

 

(9,822)

 

Contingent consideration payments in connection with business combinations

 

 

 

(3,091)

 

Net cash used for financing activities

 

(10,226)

 

 

(30,913)

 

Effect of foreign currency exchange rates on cash and cash equivalents

 

1,390

 

 

(3,452)

 

Net increase (decrease) in cash and cash equivalents

 

1,672

 

 

(7,156)

 

Cash and cash equivalents at beginning of period

 

57,153

 

 

74,302

 

Cash and cash equivalents at end of period

 

$

58,825

 

 

$

67,146

 

 

 

 

 

 

Supplemental cash flow information:

 

 

 

 

Income taxes paid

 

$

8,235

 

 

$

3,242

 

Interest paid

 

$

375

 

 

$

1,404

 

UNIVERSAL ELECTRONICS INC.
RECONCILIATION OF ADJUSTED NON-GAAP FINANCIAL RESULTS
(In thousands, except per share amounts)
(Unaudited)

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

 

2021

 

2020

 

2021

 

2020

Net sales:

 

 

 

 

 

 

 

 

Net sales - GAAP

 

$

155,625

 

 

$

153,505

 

 

$

456,658

 

 

$

458,416

 

Stock-based compensation for performance-based warrants

 

124

 

 

187

 

 

398

 

 

525

 

Adjusted Non-GAAP net sales

 

$

155,749

 

 

$

153,692

 

 

$

457,056

 

 

$

458,941

 

 

 

 

 

 

 

 

 

 

Cost of sales:

 

 

 

 

 

 

 

 

Cost of sales - GAAP

 

$

109,805

 

 

$

109,349

 

 

$

319,777

 

 

$

333,244

 

Section 301 U.S. tariffs on goods imported from China (1)

 

 

 

 

 

 

 

(3,523)

 

Excess manufacturing overhead and factory transition costs (2)

 

(1,347)

 

 

(1,618)

 

 

(3,568)

 

 

(6,346)

 

Loss on sale of Ohio call center (3)

 

 

 

 

 

 

 

(570)

 

Gain on release from Ohio call center lease obligation guarantee (4)

 

 

 

 

 

542

 

 

 

Stock-based compensation expense

 

(39)

 

 

(36)

 

 

(116)

 

 

(146)

 

Adjustments to acquired tangible assets (5)

 

(65)

 

 

(66)

 

 

(194)

 

 

(198)

 

Employee related restructuring

 

 

 

 

 

 

 

(204)

 

Adjusted Non-GAAP cost of sales

 

108,354

 

 

107,629

 

 

316,441

 

 

322,257

 

Adjusted Non-GAAP gross profit

 

$

47,395

 

 

$

46,063

 

 

$

140,615

 

 

$

136,684

 

 

 

 

 

 

 

 

 

 

Gross margin:

 

 

 

 

 

 

 

 

Gross margin - GAAP

 

29.4

%

 

28.8

%

 

30.0

%

 

27.3

%

Stock-based compensation for performance-based warrants

 

0.1

%

 

0.1

%

 

0.1

%

 

0.1

%

Section 301 U.S. tariffs on goods imported from China (1)

 

%

 

%

 

%

 

0.8

%

Excess manufacturing overhead and factory transition costs (2)

 

0.9

%

 

1.1

%

 

0.8

%

 

1.4

%

Loss on sale of Ohio call center (3)

 

%

 

%

 

%

 

0.1

%

Gain on release from Ohio call center lease obligation guarantee (4)

 

%

 

%

 

(0.1)

%

 

%

Stock-based compensation expense

 

0.0

%

 

0.0

%

 

0.0

%

 

0.0

%

Adjustments to acquired tangible assets (5)

 

0.0

%

 

0.0

%

 

0.0

%

 

0.0

%

Employee related restructuring

 

%

 

%

 

%

 

0.1

%

Adjusted Non-GAAP gross margin

 

30.4

%

 

30.0

%

 

30.8

%

 

29.8

%

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Operating expenses - GAAP

 

$

36,916

 

 

$

33,910

 

 

$

110,345

 

 

$

100,420

 

Stock-based compensation expense

 

(2,433)

 

 

(2,224)

 

 

(7,400)

 

 

(6,708)

 

Amortization of acquired intangible assets

 

(277)

 

 

(1,232)

 

 

(830)

 

 

(4,023)

 

Change in contingent consideration

 

(13)

 

 

204

 

 

180

 

 

2,428

 

Litigation costs (6)

 

(3,529)

 

 

(1,614)

 

 

(10,006)

 

 

(1,614)

 

Employee related restructuring and other costs

 

 

 

 

 

111

 

 

(287)

 

Adjusted Non-GAAP operating expenses

 

$

30,664

 

 

$

29,044

 

 

$

92,400

 

 

$

90,216

 

UNIVERSAL ELECTRONICS INC.
RECONCILIATION OF ADJUSTED NON-GAAP FINANCIAL RESULTS
(In thousands, except per share amounts)
(Unaudited)

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

 

2021

 

2020

 

2021

 

2020

Operating income:

 

 

 

 

 

 

 

 

Operating income - GAAP

 

$

8,904

 

 

$

10,246

 

 

$

26,536

 

 

$

24,752

 

Stock-based compensation for performance-based warrants

 

124

 

 

187

 

 

398

 

 

525

 

Section 301 U.S. tariffs on goods imported from China (1)

 

 

 

 

 

 

 

3,523

 

Excess manufacturing overhead and factory transition costs (2)

 

1,347

 

 

1,618

 

 

3,568

 

 

6,346

 

Loss on sale of Ohio call center (3)

 

 

 

 

 

 

 

570

 

Gain on release from Ohio call center lease obligation guarantee (4)

 

 

 

 

 

(542)

 

 

 

Stock-based compensation expense

 

2,472

 

 

2,260

 

 

7,516

 

 

6,854

 

Adjustments to acquired tangible assets (5)

 

65

 

 

66

 

 

194

 

 

198

 

Amortization of acquired intangible assets

 

277

 

 

1,232

 

 

830

 

 

4,023

 

Change in contingent consideration

 

13

 

 

(204)

 

 

(180)

 

 

(2,428)

 

Litigation costs (6)

 

3,529

 

 

1,614

 

 

10,006

 

 

1,614

 

Employee related restructuring and other costs

 

 

 

 

 

(111)

 

 

491

 

Adjusted Non-GAAP operating income

 

$

16,731

 

 

$

17,019

 

 

$

48,215

 

 

$

46,468

 

 

 

 

 

 

 

 

 

 

Adjusted pro forma operating income as a percentage of net sales

 

10.7

%

 

11.1

%

 

10.5

%

 

10.1

%

 

 

 

 

 

 

 

 

 

Net income (loss):

 

 

 

 

 

 

 

 

Net income (loss) - GAAP

 

$

(955)

 

 

$

6,168

 

 

$

11,631

 

 

$

26,414

 

Stock-based compensation for performance-based warrants

 

124

 

 

187

 

 

398

 

 

525

 

Section 301 U.S. tariffs on goods imported from China (1)

 

 

 

 

 

 

 

3,523

 

Excess manufacturing overhead and factory transition costs (2)

 

1,347

 

 

1,618

 

 

3,568

 

 

6,346

 

Loss on sale of Ohio call center (3)

 

 

 

 

 

 

 

570

 

Gain on release from Ohio call center lease obligation guarantee (4)

 

 

 

 

 

(542)

 

 

 

Stock-based compensation expense

 

2,472

 

 

2,260

 

 

7,516

 

 

6,854

 

Adjustments to acquired tangible assets (5)

 

65

 

 

66

 

 

194

 

 

198

 

Amortization of acquired intangible assets

 

277

 

 

1,232

 

 

830

 

 

4,023

 

Change in contingent consideration

 

13

 

 

(204)

 

 

(180)

 

 

(2,428)

 

Litigation costs (6)

 

3,529

 

 

1,614

 

 

10,006

 

 

1,614

 

Employee related restructuring and other costs

 

 

 

 

 

(111)

 

 

491

 

Loss on sale of Argentina subsidiary (7)

 

6,050

 

 

 

 

6,050

 

 

 

Accrued social insurance adjustment (8)

 

 

 

 

 

 

 

(9,464)

 

Foreign currency net (gain)/loss

 

166

 

 

1,597

 

 

755

 

 

1,388

 

Income tax provision on adjustments

 

995

 

 

(1,408)

 

 

195

 

 

(1,483)

 

Other income tax adjustments (9)

 

 

 

 

 

 

 

(1,303)

 

Adjusted Non-GAAP net income

 

$

14,083

 

 

$

13,130

 

 

$

40,310

 

 

$

37,268

 

 

 

 

 

 

 

 

 

 

Diluted shares used in computing earnings per share:

 

 

 

 

 

 

 

 

GAAP

 

13,392

 

 

14,205

 

 

13,920

 

 

14,189

 

Adjusted Non-GAAP

 

13,636

 

 

14,205

 

 

13,920

 

 

14,189

 

 

 

 

 

 

 

 

 

 

Diluted earnings (loss) per share:

 

 

 

 

 

 

 

 

Diluted earnings (loss) per share - GAAP

 

$

(0.07)

 

 

$

0.43

 

 

$

0.84

 

 

$

1.86

 

Total adjustments

 

$

1.10

 

 

$

0.49

 

 

$

2.06

 

 

$

0.76

 

Adjusted Non-GAAP diluted earnings per share

 

$

1.03

 

 

$

0.92

 

 

$

2.90

 

 

$

2.63

 

(1)

 

The nine months ended September 30, 2020 include costs directly attributable to the additional Section 301 U.S. tariffs implemented in 2018 on goods manufactured in China and imported into the U.S.

(2)

 

The three and nine months ended September 30, 2021 and 2020 include excess manufacturing overhead costs due to the expansion of our manufacturing facility in Mexico where products destined for the U.S. market are now manufactured. These products destined for the U.S. market were previously manufactured in China. Additionally, the nine months ended September 30, 2020 includes excess manufacturing overhead costs incurred as we temporarily shut-down our China and Mexico-based factories as a result of the COVID-19 pandemic.

(3)

 

Consists of the loss recorded on the sale of our Ohio call center in February 2020.

(4)

 

Consists of the gain associated with the January 2021 release from our guarantee of the lease obligation related to our Ohio call center which was sold in February 2020.

(5)

 

Consists of depreciation related to the mark-up from cost to fair value of fixed assets acquired in business combinations.

(6)

 

Consists of expenses related to our International Trade Commission (“ITC”) investigation of Roku, Inc. and certain other related entities. We have requested the ITC to issue a permanent limited exclusion order prohibiting the importation of certain products into the United States due to their infringement of our patents.

(7)

 

Consists of the loss recorded on the sale of our Argentina subsidiary in September 2021.

(8)

 

Consists of the reversal of a social insurance accrual related to our Guangzhou entity, which was sold in 2018. The indemnification agreement related to the sale of our Guangzhou entity expired in the second quarter of 2020.

(9)

 

The nine months ended September 30, 2020 includes the reversal of a reserve of an uncertain tax position related to our Guangzhou entity, which was sold in 2018. The indemnification agreement related to the sale of our Guangzhou entity expired in the second quarter of 2020.

 

Contacts

Paul Arling, Chairman & CEO, UEI, 480-530-3000
Investors: Kirsten Chapman, LHA Investor Relations, uei@lhai.com, 415-433-3777

Release Summary

Universal Electronics Reports Financial Results for the Third Quarter 2021

$Cashtags

Contacts

Paul Arling, Chairman & CEO, UEI, 480-530-3000
Investors: Kirsten Chapman, LHA Investor Relations, uei@lhai.com, 415-433-3777