These results were always going to be more about the message/outlook rather than the figures , which were fairly poor as expected. The rns itself is quite bullish.
On the plus side, there was the Spreadtrum GPU win (hitherto ARM cpu/gpu, though recently Intel took an equity stake) - will be interesting to see if PowerVR gets actual volume there. H2 licensing was strong but can IMG maintain the momentum? The 30-40% margin target is re-stated but without ditching PURE (7th year in a row of losses) I am unclear how this will happen - an IP company doesn't need an OEM division no matter what justification is provided - if the IP is good enough, it will be licensed, simples (have a word Bert). The MIPS emdedded sub-system is interesting, looks like a side/back-door entry into mobile apps market - not clear at all who it is but sounds like a vertical player ? The non-MIPS ASP remains strong though we have stagnation of volume - should pick up this year with more MTK volume (via Meizu MX5 etc etc) but vast majority at MTK still Mali of course.
No change in the post-CC analyst opinions either way, as evidence is required ie. hard numbers. Hard to argue with that.
https://imagination-technologies-cloudfront-assets.s3.amazonaws.com/presentations/30062015/Imagination%20Technologies%20-%20Full%20year%20results%20-%2030%20June%202015.pdf
Key bits:
Financial highlights
· Group revenues of £177.0m (2014: £170.8m)
· Technology revenues increased 7% to £158.6m (2014: £147.6m)
- Licensing revenues up 2% to £39.0m (2014: £38.3m)
- Royalty revenues up 9% to £118.9m (2014: £109.0m)
· Adjusted operating profit* of £21.1m (2014: £24.0m); Reported operating loss of £8.5m (2014: £0.1m)
· Adjusted earnings per share* 6.3p (2014: 8.1p); Reported loss per share 4.9p (2014: earnings 0.3p)
Business highlights
· Strong licensing across all IP families, delivering highest ever licensing revenue and record backlog
- 121 licenses signed (2014: 115) with over 40 existing and new partners
- Agreements signed with partners including Ali, Atomos, Avago, Broadcom, Celeno, Elvees, Fujitsu, HiSilicon, Ineda, InfoTM, Intel, JCI, Lantiq, Loongson, MediaTek, Pioneer, Renesas, Sigma, Spreadtrum, Texas Instruments, Toshiba, Toumaz and Yokogawa
· Significant increase in new committed SoCs with over 60 additional SoC design-wins which will contribute to future royalties
· MIPS unit shipments increased 9% year on year to record level of 797m (2014: 729m); non-MIPS shipments stable at 530m (2014: 530m)
· Pure loss reduced following the actions taken last year
Outlook
· Based on the increased backlog and the active pipeline of prospects, target of 10% growth in licensing revenue in FY16
· Expect growth in unit shipments and royalty revenue
· Underlying operating cost growth expected to be 5% - 10%
· Expansion of operating margins in medium-term with longer-term target of 30% - 40%, with a rise in profitability in FY16
Hossein Yassaie, Chief Executive, commented:
“We have seen robust licensing and royalty revenues across all three IP families whilst continuing to tightly control our costs.
“Significantly we have secured major design wins for our graphics and processor IP with new high volume mobile players - these multi-year agreements will further drive unit shipments in the medium term. Our connectivity IP continues to gain momentum.
“The established strengths and comprehensive nature of our three key IP families have enabled our unique platform capability which has significantly contributed to licensing revenues this year.
“As our revenues grow, the natural operational gearing of the business means that the financial performance is expected to significantly benefit from a slower growth in operating costs. We therefore expect to see significant expansion in operating margins in the medium-term.”
Acceleration of licensing in the second half of the year resulting in record licensing revenues
121 licenses including 52 for PowerVR multimedia, 47 for MIPS CPU, 15 for Ensigma comms and 7
System-level / support IP (including FlowCloud, VoIP, and Caskeid)
Significant agreements with over 40 partners during the year including Ali, Atomos, Avago, Broadcom,
Celeno, Elvees, Fujitsu, HiSilicon, Ineda, InfoTM, Intel, JCI, Lantiq, Loongson, MediaTek, Pioneer,
Renesas, Sigma, Spreadtrum, Texas Instruments, Toshiba, Toumaz and Yokogawa
Licenses signed for new IP across all key IP families (including Series7 GPU, Warrior MIPS cores and
Ensigma RPU / NPU)
New, significant and strategically important licensing deals with high volume / tier-one mobile players for
both PowerVR graphics and MIPS processors
Increasing number of licenses signed involving IP from multiple families. There is a growing and general
trend towards demand for IP sub-systems or solutions combining multiple IP cores, an aspect that our
strategy is designed to fully support
Partner chip unit shipments grew to 1,327m units (2014: 1,259m)
Non-MIPS shipments were stable at 530m (2014: 530m). We have seen an increasing proportion of
shipments using Series6 graphics technology and given the design wins achieved during the year we
expect this to continue to grow
MIPS shipments increased strongly to their highest annual level of 797m units (2014: 729m)
The licensing activity in the year has resulted in a significant increase in new committed SoCs with over
60 new SoC design-wins added which will contribute to future royalties
During the year there were 27 PowerVR GPU licenses across all markets and segments. These included a
number of licenses to customers using PowerVR graphics in high volume markets, with one licensing PowerVR
graphics for the first time.
As a result customers’ engagements and licensing activities have been
strong and encouraging with 47 licenses concluded globally for MIPS cores across existing and new customers
during the year. Among these there were a number of strategically important agreements including a key license
with a tier-one mobile player for a significant embedded subsystem in mainstream mobile application processors
